February 5, 2010

Mr. President:  The January Harper's reports surprising 401(K) retirement savings figures
(taken from the Employee Benefit Research Institute in Washington):  The average
balance today is $45,000 down from $62,000 in 1998, and 46 percent are worth less than
$10,000.  So the much touted stock market gains used to sell 401(K)'s to the public has
not materialized.  Instead of ballooning our accounts into retirement heaven, we are
heading to the poor house.  In the meantime, corporations have happily jettisoned the
burdensome guaranteed pension plans.  If nothing is done, retirees are headed for serious
problems, particularly as the cost of living allowance (COLA) now added is so contrived.  
Thanks to Mr. Clinton your Democratic predecessor, who was desperate to reduce the
deficit, COLA has ceased to correspond to real inflation, and imposes a disguised tax
penalty on Social Security pensions.

A revised report released today informs us 8.4 million jobs have been lost so far in this
recession.  According to your press office, the stimulus money spent for each job created
or saved is $250,000.  So it would take $2.1 trillion to retrieve the lost jobs, and obviously
not a job for the government alone.  Yet, the big banks refuse to open their coffers to lend
for investment.  It is why they should have been put through the FDIC process for failing
banks as this letter recommended many times in the early days of your administration.

Mr. President, did you happen to see Dr. Margaret Flowers on Bill Moyers' Journal?  Clear-
eyed and full of compassion, she has seen the ravages of our healthcare system, the
needless suffering, the unnecessary deaths.  As a spokesperson for a physicians group
advocating a single-payer plan - slogan:  Medicare for All - she tried to deliver a petition at
the White House.  She was arrested.  Now, one would think a person could drop off a letter
at your door but apparently not.

At first, the Congressional committees gave her group a hearing.  She thought, naively as
it turned out, that when the alternative plans were compared, single-payer offering better
health care for less would win out.  Not so.  The White House unable or unwilling to
challenge the industry pulled the rug out from under it.  In the same TV program, your
party and the Republicans were called equal opportunity hypocrites.

You are the first President since Richard Nixon to have chosen to run entirely on private
fund raising.  As of December, you had attended twenty-six fund raisers averaging one
every two weeks; George Bush in the same period had six.  Here's another statistic:  By the
end of last October, you had played more golf than George Bush did in his entire term of
office.

Sir, on one of the news programs, you were musing the other day about being a one-term
President.  Forgive me for saying so but if you are, it won't be for want of trying to help
those that elected you, it will be because you never really did try.  Given the Scott Brown
primer, the hope is there will be real change; my hope is you will come to be remembered
as a statesman, not a glib politician.



January 29, 2010

Mr. President:  Congratulations!  It was a fine speech, mesmerizing in its flow of words,
reminding us yet again why the people elected you.  The enormity of our problems, the
near twenty percent real unemployment rate, the trillions in deficits, the homeless, the
dead and dying in Iraq and Afghanistan ... all washed away as we bathed in the warm glow
of your words accompanied by a chant, albeit a little tentative, of 'we're number one' by the
legislators --- when you stated we were going to be second to none in clean energy and
high speed rail.

The consequence of a misspent youth --- all kinds of journals come across my desk;
among them the organs of the Institution of Engineering and Technology (basically
Electrical Engineers) and the Institution of Mechanical Engineers.  As a result, much on the
French TGV and cross-channel Eurostar has become familiar.  Imagine my surprise and
dismay then, when the Illinois piece of the high speed rail development was touted as 'will
have speeds up to 110 mph, up from 70 mph'.  A long time ago the TGV set a record of
357 mph, while its usual runs have averaged 320 kilometers per hour (200mph) on some
lines and 300 kph (187 mph) on others.  We have a long way to go.

Mr. President, you have asked for suggestions on reducing the deficit.  Here is one.  We
started outsourcing many military functions, at enormous cost, because of a smaller
volunteer force.  Recruiters are now meeting quotas despite the wars and the likelihood of
being sent to one of them.  It makes sense, therefore, to reclaim the hugely expensive
outsourced activities and enlarge our active force.  This would both alleviate the
unemployment problem and reduce defense expenditure overall.

Here is another one.  I have often wondered what the army does when we are not at war.  
Oh, yes, there are training exercises but the national guard does pretty well with training
over weekends.  Let us take a leaf from the Chinese book.  Our soldiers, as soldiers
everywhere, are notoriously underpaid.  Why can we not persuade manufacturers to set
up plants near our bases?  The soldiers could be paid a wage as a salary supplement,
their wives would have a shot at decent jobs and transfers would become less frequent.  
The details will have to be worked out by your experts but the advantages are
transparent.  Soldiers improve their standard of living; corporations become export
competitive because the supplement would be less than standard manufacturing wages,
and our government will take a share of the profits thereby reducing the deficit.

Finally, Mr. President, there is one area  -- among many for sure -- where we are truly
number one, and that is the number of adults incarcerated.  It is an enormous wasted
resource.  As we spend about a $100,000 annually per inmate, they should be  put to
useful work.  I am sure specialists and experts can conjure up great ideas.  Here's a
starter:  How about using them to shore up our crumbling infrastructure; in fact, we could
put them to work on our version of high-speed rail right away.



January 22, 2010

Mr. President:  Not so long ago people were saying, 'Don't vote for a third party candidate,
you will be wasting your vote.'  It seems the good people of Massachusetts, liberal to the
core, took the advice to heart.  They voted Republican!  Their message this time has had
an impact.  They had voted for change in November 2008; instead they were given more of
the same -- the same wars, the same coddling of bankers plus the additional coddling of
the health care industry.

Now it seems the abomination of a health care bill - forgive me, Mr. President, but some
are calling it Obamanation -- has been put on hold.  During its development, single payer
advocates were shut out despite polls showing 70% of the country favoring such a plan as
the most effective and least costly way of delivering health care.

You have now come out in favor of regulating the private equity and hedge fund
operations of banks.  But, Sir, the time to act was when the bankers were on their knees.  
That was the time to bring back Glass-Steagall that served us so well for more than half a
century.  Instead we got the people who were instrumental in its demise, then had topped it
off with the Commodity Futures Modernization Act of December 2000 which prevented the
regulation of Credit Default Swaps, a significant factor in the financial disaster.  As long as
commercial and investment banking are allowed to co-mingle, we are prone to disaster.  It
is a natural consequence over the long term of trading where there is a high probability of
profit and a very, very small risk of a huge loss.  What is more troubling of course is that
bankers have now experienced a bail out, so they are further emboldened.

Everyone appreciates the help you have offered to Haiti.  Those who have taken the
trouble to review our history there might feel the $100 million should have been a grant
rather than a long-term loan.  As it is, Haiti is unable to repay its older debt and its present
government is barely functional.  Would you consider supporting a UN mandate, as in
Bosnia, until the country can get back on its feet?

Lastly, reasonable people of all faiths are grateful to your government for finally offering
Professor Tariq Ramadan of Oxford University, a noted Islamic philosopher, a visa.  Earlier,
he was unable to take up a visiting appointment at Notre Dame because the Bush
administration revoked his visa based on a claim that he had contributed to a terrorist
organization.  It did not help our relations with the Islamic world just as it does not help to
put all citizens of fourteen countries, of which thirteen are Islamic, on a terrorism watch list
because of one disturbed young man from Nigeria about whom we were warned in the first
place.




January 16, 2009

Mr. President:  Lurching from disaster to disaster, poor benighted Haiti needs help and we
are all happy you stepped forward with a generous offer.  Thank you.  As usual, the
citizenry will do its part through contributions to NGOs.

If there is any quibble, it's with the emergency management response.  There are now
twenty international search and rescue teams operating in Haiti of which only four are
ours.  Given the time it can take one team to rescue one person, you will have to agree,
Sir, we could have done better.  And one may ask why the US AID administrator is leading
this effort - surely his purview is long term.  Whatever happened to the fine professionals
of FEMA which developed into an excellent emergency response agency during the Carter
years?  Yes, it was gradually starved, had its "heckuva job Brownie" moment in New
Orleans under your predecessor, and finally swallowed by the Homeland Security
monster.  But there must be some professionals left, or are we here at home going to be in
trouble again when we suffer the next disaster?

As is clear to all, the first few days after an earthquake are critical.  Yet there was no one
there for the first two.  Surely a satellite survey would have revealed the extent of damage,
the non-functioning airport tower, the damaged harbor, the devastation in the cities.  It
should have been enough for us to have immediately sent as many search and rescue
teams as we could muster and a temporary airport control system.

The estimates of dead are now in the tens of thousands and one has to wonder how many
more lives could have been saved.  It is also sobering to realize that Los Angeles had a
similar magnitude seven earthquake a few years ago and the death toll was sixty-three.  
Yes, poverty has its price.

Mr. President, yet another bank has reported a huge profit increase.  This time it's JP
Morgan Chase.  Profit for the last quarter of 2009:? Over $3 billion compared to $0.7
billion a year earlier - aid from taxpayers, $25 billion.  One would think the bank has
substantially increased lending to businesses, bringing jobs into the economy.  But no
such luck, the profit is from trading and investment banking.  So, it's back to the casino.  
How long until the next bust?  We'll just have to wait and see.  Will we ever return to the
reasonable rules and regulations we had a couple of decades ago before the deregulation
disease infected our law-makers as much as the addictive election coffers that sent them
into torpor?  Again, we'll have to wait and see but it's unlikely we will soon have as good a
chance of doing something as we did a year ago.

Good luck in Boston on Sunday!  If the Democrats lose that Senate seat we will be in more
trouble than we are in now.




January 8, 2010

Mr. President:  The report on the attempted Christmas bombing of a plane over Detroit has
been a shocker.  If the bomber's father, worried about his son and in an effort to prevent
him harming himself and others, had informed our embassy in Nigeria about the young
man's extremist inclinations, and if we still could not stop him, we have a problem, and one
not easily solved given the quantity of data being processed.  Yes, he was put on a watch
list and he was going to be questioned when he landed, and yes, better screening or
interrogation in Amsterdam might have helped but then the French thoroughly questioned
the shoe bomber to no avail before he was allowed on board.

Perhaps a better way to look at the problem, Sir, is to ask ourselves  why we are hated so
much.  Your predecessor's answer, which he sold to the American public quite effectively
was, 'they hate our freedom'.  Really!  But then he also sold the idea that Iraq was
responsible for 9/11.  And, he rolled Congress on two wars and a lot else -- there is much
to learn from the man.  To return to the question though, could it be our policies and
actions?

Whether it has been Latin America, where our habit of extracting resources with the help of
a complicit elite led to the impoverishment of common people, or the Muslim world appalled
at our (or Israel's) use of firepower on civilians, or Africa, or ..., it is always our policies and
actions that inform attitudes and feelings towards us.

Which brings us to our problems in Afghanistan.  Our new counterinsurgency (COIN)
strategy much vaunted by the army seeks to minimize civilian casualties.  Yet, the drone
program, run by the CIA, has been determined to have an average kill ratio of two percent
meaning:  we kill forty-nine civilians -- mostly women and children since we are attacking
homes -- for every active insurgent leader.  The question to ask is if these two instruments
of our power are acting in concert.  By the way, Sir, here is another reason why most of us
would not want to be President.  There aren't too many who could calmly sign an order
consigning women and children sitting down to dinner to oblivion.  I suppose we can think
up rationalizations.

The way many see it now, the war is unwinnable but the political climate not yet suited to
bringing the troops home.  They are saying the only exit strategy is to find a respected
mediator and come to some sort of understanding where the majority Pashtuns are truly
represented in this current Tajik dominated government and army.

They are also saying the COIN strategy will not win the war in the long run, just stave off
defeat long enough for a politically feasible withdrawal.  And young men on both sides
must die needlessly in the interim, not to mention the civilian havoc in Pakistan.  There is
surely a case for a single five or six-year term for our Presidents.



January 1, 2010

Mr. President, a happy new year to you and your family.

The new year is also a time for assessment.  Some say your economic policies are
working, others differ.  The stock market has been climbing, sixty percent since March, and
the people's stock in you Sir, judging by the polls, is falling in equal measure.  The junkie
bankers got their fix from us instead of rehab and are back on bonuses ($140 billion this
time).

How are we going to pay the horrendous bills racked up?  Some are saying our economy
will be dead in the water for the next decade much like Japan, who also refused to confront
the bankers and their junked assets.  This website, Sir, warned you of the problem in both
Commentary and Letter sections nine months ago.  Of course, the people only have polls
to express their resentment, not the financial clout of, say, a Goldman-Sachs.

The war has been going badly, particularly this week when the CIA suffered its biggest
single loss in a quarter century.  The last time something of this magnitude occurred,
Reagan was smart enough to get out (of Lebanon).  Pakistan has suffered thousands
killed ever since we forced them to attack their own population.  Just today ninety died (and
the final figure will, as always, be higher) in a suicide bombing during a volleyball
tournament at a sports stadium.  We used to blame our failures in Afghanistan on Pakistan
'not doing enough' but one supposes being killed is enough for those voices have muted.  
The new bogeyman is Karzai and his corrupt government.  Corrupt or not, without money
and without a functioning army, what can he do?  His writ barely covers Kabul.

The history of this war is tragic.  Innocent civilians died in 9/11.  Afghans were not involved
in the attack.  Yes, the Pashtun government led by the Taleban refused to give up bin
Laden et al in accordance with their strong traditions of obligation to guests.  But
negotiations would have achieved a better objective than the status quo.  Instead, we
bombed, killing more innocent civilians, who probably were not even aware of the existence
of New York's twin towers.

We used the Northern Alliance, who controlled some of northern Afghanistan in an
incipient civil war, to help drive out the Pashtun government.  We, the allies of the Northern
Alliance and ipso facto antithetical to Pashtun interests, are now also viewed as foreign
occupiers.  As the killings of civilians rise through the increase of drone attacks, so does
the resentment against foreign militaries.  Force escalation implies we can win by
subjugation, Mr. President.  But given the history of these people, do you really think it
feasible?

On the healthcare front, the bills before Congress are so weak in real improvement, they
have lost public support.  To this observer, we have conflated health insurance with health
care.

All of the above, yet hope brightens our day, Mr. President.  We continue to hope, and we
wish for you in 2010 the wisdom to make the right decisions and the determination to see
them through.





December 25, 2009

Mr. President:  Merry Christmas and a Happy New Year to you and your family.  May we
hope the New Year brings the courage to lead, the wisdom to lead in the right direction,
and the strength to bend Congress to fulfil the expectations (raised by your rhetoric) of the
many who lodged their trust with you.


December 18, 2009

Mr. President:  As the Climate Change Conference winds down, a neutral observer might
ask this question:  You have, Sir, on occasions too numerous to recount, exhorted us to
take responsibility for our actions.  Might not the island states of the Maldives and Tuvalu
about to be submerged ask you the same question?  In the past century, the US and
Europe have emitted 315 and 419 billion tons of CO2; the developing world a relatively
paltry 50 billion tons.  These nations now suffering our excesses might expect you to take
the lead in offering future sacrifice and a stringent regime to reduce pollution.  The short-
term financing pledges ($11 billion from Japan, $10.6 billion from EU and only $3.6 billion
from the US) underscore our half-hearted efforts to help.

The way the health care bill is shaping up, the winners and losers in health care (and
banking) have been already summarized quite trenchantly and with unerring predictive
accuracy in the July 26, 2009 "Specieal" News satire (Fat Cats Bacchanalia) on this
website.  No doubt many well-meaning democrats will hold their noses and vote for this bill
- in a triumph of the domestic version of Kissinger's realpolitik over Wilsonian idealism.  
And just as realpolitik in foreign policy has brought us unimagined enemies crawling out of
the woodwork, so does it look to be a disaster for Democrats in future elections.

In buying the silence of insurers, pharmaceuticals and the health industry, may I say the
White House has carried realpolitik a step too far for it has trodden over the backs of the
poor and defenseless.  Mandating the purchase of unaffordable health insurance (or
affordable but useless high-deductible, low payout insurance) from for-profit insurers is a
massive transfer of wealth from the already strapped poor strata of society to the rich.  
Wall Street has given its verdict on the health care bill this week.  Despite a down market,
health industry and insurance stocks hit 52-week highs.

By the way, only the ingenious mind of Rahm Emanuel could have gotten you between a
rock and a hard place on this bill.  If it passes, you and the Democratic party are going to
suffer the public's wrath when the effects begin to bite.  If it does not, the Republicans will
have a heyday reaping the benefits of failed healthcare reform.

This week we not only sent out our AfPak drones but also bombed (pardon me, "provided
fire power, intelligence and other support") "al Qaeda camps"  in Yemen.  When we bomb
homes, what do we expect?  In this case early reports indicate 17 women and 23 children
killed.  When this kind of news is broadcast around the world, one wonders if it wins us
friends anywhere?  Given human nature, it surely reinforces the resolve of insurgents and
depresses the spirit of our allies in these countries.

Forgive me, Mr. President, but in this your first year, you seem to have snatched
disappointment out of promise, despair from hope and defeat from victory.  One can only
wish you have learned and will begin to represent the interests of those who elected you
during the next three years.  Not all the goodwill is lost and the country is desperate for a
leader.

In this holiday season let me wish you a Merry Christmas and a Happy New Year.




December 11, 2009

Welcome back from Oslo Mr. President and congratulations once again.  November
through early December is about the worst time of year there:  short days, dark, and rain
freezing as it touches the ground.  As they use gravel more than salt, the city to the less
nimble visitor becomes a vast skating rink.  The snow comes as welcome relief.  Easier to
walk on and brightening up the city, it cheers us on to Christmas festivities and to the days
becoming progressively longer.

When I was there, researching industrial innovation and teaching, I found the Norwegians
to be a kindly, polite, very reserved, well-meaning people who did far more than their share
of helping the world.  But reserved insularity can make for mistakes in political judgment.

As I watched a live broadcast of the ceremony, the Nobel Committee Chair's speech stood
out as unusual.  Most speeches of this nature recount the awardee's many
accomplishments but Mr. Jagland spent his time justifying the award itself.  Your speech,
Mr. President, was cut off unfortunately by the time constraints of the BBC broadcast.

I understand you discussed the concept of "just war"  against "evil" in this world.  Just war
against Iraqis causing hundreds of thousands civilian deaths?  Yes, you didn't vote for that
war (you were not there) but you voted for funding the ongoing slaughter.  The Iraqis
continue to suffer.  Just this week huge car bombs devastated Baghdad with 200 dead and
over 500 wounded.  If this is the kind of success and stability envisioned by the generals,
heaven help the poor Afghans.

Mr. President, you have repeated often that they attacked us.  Forgive me, Sir, but the
Afghans have never been involved in international terrorism and have never attacked
anyone outside their country.  Yes, the al-Qaeda leadership was based there but so far
there is not a shred of evidence implicating the Taleban.  In fact, the planner, Khalid
Sheikh Mohammed, was based in Pakistan and the detailed preparation was carried out in
Europe and the U.S.  Exactly how the poor illiterate Pashtun civilian, the main victim of our
vengeance, is responsible requires sophisticated rhetorical skills.

You say a President can not be a pacifist; as a fellow citizen, I agree.  But you must explain
one nagging question:  The drone attacks have now been assessed a kill ratio of 2%,
namely, ninety-eight civilians (mostly women and children because we are bombing houses
of insurgents) on average are killed for every two targets.  The latter are of course
replaced by the insurgents just like one of our generals would be if the circumstances  
were reversed.  My question to a Nobel Peace Laureate is simple:  How did you, Sir, not
just sign-off on the old regime but actually escalate these attacks?  Forgive my question,
Mr. President.  But the issue is very serious because Judge Richard Goldstone has stated
categorically that under a modern 21st century interpretation of the laws of war such an act
constitutes a war crime.

Sir, you evoke Reinhold Niebuhr's concept of just war to protect the innocent but the early
thirties when he authored the idea represented a gathering Nazi menace and rampaging
Japanese imperialism.  These were a far cry from the starving benighted people of
Afghanistan, and I cannot recall the Afghan Pashtuns ever threatening to attack the U.S.
mainland.  We ought not to forget Reinhold's brother Richard (the reason for Reinhold's
commentary) who argued obedience to God's commandments required Christian
nonviolence and anything less meant a distrust in God and God's promises.  It is a
sentiment, you as a committed Christian are certain to appreciate but for some reason it is
quoted less often.

Evoking evil, you served as a reminder of your predecessor.  One cannot compromise with
evil.  But as any observer of the Afghan scene will inform you, a solution there will require
Pashtun participation and necessarily that of their strongest representatives, the Taleban.  
Sitting down with them after calling them evil leads to charges of hypocrisy and moral
surrender.

Despite the barrage of half-truths and misinformation from the major media, the populace
is just about split on the Afghan 'surge'.  Not that it means much other than a lack of trust
in the main news organs and government.  They have learned from the past.  A substantial
majority supported the Iraq war three-quarters holding Saddam Hussein quite erroneously
responsible for 9/11 mainly because of the official half-truths flooding the airwaves.  At
enormous cost, much of it still to be paid, we overthrew a secular government (with a
Christian Prime Minister) which was viscerally opposed to al-Qaeda's fundamentalist
philosophy.

As the war escalates next spring and Afghanistan spirals toward chaos with Pakistan in its
wake, one will be reminded of another Peace Nobelist, Henry Kissinger, whose peace in
Vietnam supporting a corrupt government was obliterated even while the medal was still
warm in his pocket.



December 4, 2009

Mr. President, when you promised us change, we believed you.  As we proceed with the
surge in Afghanistan, I am thinking that more and more young men are going to lose their
lives.  For what, Mr. President?  You said you want to deny al-Qaeda a base.  Do they
need one?  The attack on us was planned in Germany and right here.  Since then our
much improved police work has resulted in many successes.

Insurgents do not offer themselves in pitched battle; they will simply wait us out.  Witness
Iraq where the outcome is still quite uncertain.  Sir, as you were asked in a previous letter:  
Suppose we sent all the men and equipment necessary to stop the insurgents.  Then
what?  They would still be around, among the people, quiet and waiting.

Mr. President, the cynics are saying the Afghanistan timetable you have presented has
little to do with Afghanistan's needs and is all about the 2012 election with which it happens
to dovetail perfectly.  I hope not, Sir, because it would define your administration as
callous, calculating, and putting politics above human life.

We are also preaching honesty to the Karzai government.  This, when in our system of
campaign contributions' the bankers paid huge sums to key committees and we saw the
incredible spectacle of money being funneled to them in an upward siphoning from the
poor to the rich.  The insurance and pharmaceutical companies are quite content with the
health care bill which does little to contain cost or improve the system faced by the ordinary
person.  And our middle class, bled to death by taxes, insurers, mortgage bankers and
credit card companies, is rapidly vanishing.

Our Secretary of State has still not explained how $1000 became $100,000 over one year
in a commodities trading account she owned in Arkansas back in the days when her
husband was earning about $30,000 annually.  Such masterful trading -- then why did she
cease after a year?  After his term in office, her husband has earned over a $100 million in
speaking fees, again causing wonderment.

Forgive me, Mr. President, but what was that expression about stones and glass houses?



November 27, 2009

Happy Thanksgiving!  We all hope you had a wonderful day yesterday with family and
friends.  We don't see you come 'home' to Chicago very often but then home is a concept
unsuited to the mobile society we have become.  A case in point:  a young couple across
the road bought their house about a year ago at the peak of the boom and now things
must have gone drastically wrong for they have lost it.  Too many "for sale" signs for far
too long -- an indicator perhaps of the depth of our troubles.  But what amazes us is that
many of the architects of our travails continue to reside in your administration.

Your decision on troop levels in Afghanistan is imminent, and most expect a compromise
from the compromise President.  The problem in Afghanistan is deeper than a simple
pacification of the insurgency.  For even if we are successful, that would not last unless we
stayed.  The reason is not hard to fathom:  Afghanistan is in the midst of a long-running
civil war between the Northern Alliance we support and the Pashtuns.  Yes, there are many
Pashtuns who do not like the Taleban (especially the educated urban elite) but at present
they are the best organized resistance to the NATO-Tajik alliance and the common people
are flocking to their banner.  Our ham-fisted methods have lost us any modicum of goodwill
we might have had eight years ago;  instead of behaving as a mediator, our actions moved
us inexorably to the Tajik side and the Afghan (Tajik) army.  The Afghans are eventually
going to have to sort out their own problems just as they are trying to in Iraq.

The worst aspect of the situation is the instability created in Pakistan by policy, and our
constant prodding of a weak government to attack its own people.  It is yet another reason
to back off and let the insurgency subside.  The good news is the dilution of religious
fervor among the insurgents allowing room for negotiation, and perhaps a unique
opportunity for a compromise President.  If we can mediate a settlement between the
factions, we really will have 'won' in Afghanistan, and, as a corollary, in Pakistan.



November 20, 2009

Welcome home, Mr. President.  You have certainly encountered the first signals of our
diminished influence.  Japan, your first stop, wants to renegotiate the agreement leasing
military bases signed a short while ago.  They want them moved.  At the APEC conference,
the Chinese were  the center of attention, looked to for economic recovery and lauded for
their prompt and effective response in alleviating the effects of the crisis.  We, of course,
were the cause of it.  The two wars have only exacerbated our deficit spending proving yet
again the old adage, namely, wars are costly to empire.  In all fairness, one must add that
the Chinese, and also the Japanese, get a free ride as we police the waters and keep
shipping lanes free.  But we like our unchallenged authority.

This week Israel yet again undermined our credibility in the world.  First, they were
supposed to cease building settlements, then we acquiesced to the expansion of existing
settlements, now they have announced nine hundred new houses in Gilo, a most sensitive
area abutting Jerusalem, despite our envoy's specific request to delay the announcement.  
Mr. Netanyahu's "in-your-face" attitude if unanswered does not augur well for our policy or
the image of the American Presidency.  And this after we went to great lengths to defend
them against the credible Goldstone report looking to all the world like hypocrites.  
Perhaps a smarter move might have been to use the opportunity to extract concessions
from Netanyahu first as these pages advised.

In the meantime Amnesty International has accused the Israeli government of "denying
Palestinians the right to access adequate water ... and pursuing discriminatory policies"
causing great distress and hardship.  Discrimination is something you must be acutely
sensitive to, Mr. President.  Uri Avnery, a prominent Israeli writer and former member of the
Irgun and the Knesset, calls the present Minister of Interior a religious scoundrel  (http:
//www.counterpunch.org/avnery11182009.html).  The Foreign Minister Avigdor Lieberman
offered a platform of overt racism.  Good luck with the peace talks and the two-state
solution, Mr. President.

The health care reform bill has become a late-night-show joke.  Everybody is now
convinced you will sign any bill as long as it says "health care reform".  The bills before
Congress seem to meet that definition.  Huge out-of-pocket costs, large deductibles, and
subsidies to pay for health insurance -- not the care itself!  Except for the Commission
negotiating Medicare costs and keeping Congress and the lobbyists out, the bills before us
seem like a great big handout to the insurers.  I am sorry to have to say this, Mr. President,
but the public is becoming increasingly cynical of your administration's ability to accomplish
anything substantive on any major issue.  Change has come, but Sir, the public sees it not
as you changing Washington -- rather as Washington changing you.


November 13, 2009

We are given to understand, Mr. President, that you have postponed a decision on
Afghanistan pending a definitive evaluation of strategy.  It is good news.  So far, our
policies have made us even less popular in the region.  Mrs. Clinton was heckled and
challenged, her speeches met with boos and groans, and this by the elite who cannot
abide al-Qaeda or the primitive Taleban.  By all accounts, her trip to Pakistan designed to
repair relations was an unqualified disaster.  This in a country where we are forking out
$7.5 billion.  And she dare not set foot in Afghanistan outside our bases.  (She proceeded
to the Middle-East, however, and called Netanyahu's "no" to settlement freeze a
concession.  Mahmoud Abbas promptly threw in the towel and decided not to run again for
President.)

In Afghanistan, less than 18% favor an increase in our forces, who are now viewed as
occupiers.  The insurgency led by the Pashtun majority is against the minority Tajik-
dominated government (including the military) and us as their backers.  Afghanisation
means a Tajik-Uzbek army unacceptable to the Pashtuns.  Having lost the majority
population, we have no chance of success even if we could define it as Matthew Hoh
argued convincingly in his letter of resignation.  Yet withdrawal is not an option being put
on the table by your advisers.  Sad to say, Mr. President, but Afghanistan has become
your Vietnam.  You cannot 'win' (militarily) there and you 'lose' (politically) no matter what
you do.  In the meantime, the politics of winning and losing mean the senseless killing and
displacement of hundreds of thousands continues.  Far better in the old days when the
King led his soldiers and could see the slaughter first hand, and it was confined mainly to
the soldiers.

On the economic front, the economy is beginning to show signs of a recovery thanks to the
massive dose of antibiotics.  But just like antibiotics, the side effects are not pleasant.  The
bankers are further emboldened and the dollar teetering.  Just as in mathematical
catastrophe theory, beyond the tipping point lies disaster.  The dollar has almost halved in
value in the last half dozen years.  Without knowing it, people are half as wealthy
(compared to, say, Europeans) as they were and of course their retirement portfolios are
shot.

The individuals and policies (written about frequently in earlier letters) engineering our
economic disaster are at the helm again planning a recovery designed to insulate the
perpetrators.  Deficits per se are not bad.  They can be good ... when the money is used
for investment in education, technology, well-planned infrastructure, etc.  But when it is
spent on two wars and absorbing bankers' trading losses, the consequences are not all
benign.  Mr. President, there is still time to rethink policy and send your economic advisers
also back to the drawing board.  Better still, new advisers with a better sense of direction
would bring a sigh of relief.  You have banker-friendly ardent supporters of no controls or
apparent but not real controls.  On the other side are several Nobel Laureates.  The
choice, of course, is yours Mr. President.  What we are looking for is Glass-Steagall to
insulate us from further profligacy, and a better return on the money doled out.


November 6, 2009

Much has happened this week, Mr. President, and most of it very disturbing. A
Marine officer went berserk yesterday and shot over forty fellow soldiers.  
Thirteen have died. A majority of the people now do not support the wars if the
latest polls are to be believed.  Your policies are proving to be so unpopular poll
ratings are falling precipitously and two Democratic governors have lost
elections to Republicans.  The people when they elected you, Sir, thought they
were investing in a champion of their rights but  discovered to their regret a
politician unable or unwilling to fight the power brokers.  The poll numbers
merely reflect their disillusionment.

An Italian court has sentenced 23 CIA agents to five-year prison terms with the
exception of the Milan station chief who got eight.  They were found guilty of
abducting an innocent Muslim cleric who was parceled off to our air bases in
Aviano, Italy and Ramstein, Germany before being shipped to Cairo.  There he
was imprisoned for four years and routinely tortured. Democracies according to
the Italian judge - admonishing us publicly - must respect basic rights and follow
the processes of law.  Following President Clinton and Bush, you too, Mr.
President, have signed off on rendition.  It elevates the CIA to a position of
judge, jury and executioner and makes a mockery of our laws as we continue to
conduct torture by proxy.

The UN General Assembly voted to endorse the Goldstone report on the Gaza
war and asked for credible investigations.  We have called the report flawed, and
Congress passed a resolution stating it is biased.  Judge Goldstone says he is
always willing to learn and improve and would like to know where it is flawed and
how it is biased.  The open challenge remains unanswered by us.  As a Jew who
loves Israel, Judge Goldstone says democracies must respect international law
and thinks it is in Israel's long term interest as a society and democracy to do so.

The Palestinian President, Mahmoud Abbas, is refusing to run again citing the
impossibility of negotiating with the Israelis.  Mr. Netanyahu appears to have
stared you down, Mr. President, and continues to build settlements.  The
Palestinians are fast learning the inability of secular nationalism to bring them
justice, and are turning increasingly to the Mosque and religious leadership.  
Compromises begin to appear a distant mirage.  However secure Mr. Netanyahu
may feel today, the future is laden with uncertainty and the specter of
Palestinians unable to secure a separate state that is not a Swiss cheese of
settlements demanding equal rights in a single state.

The bankers have again begun to perform like trapeze artists with a secure
safety net.  Back to business as usual with their lobbying power intact, they are
likely to display an even more thrilling act next time.  Let's try to rein them in
before it's too late, Mr. President, and Glass-Steagall is a good place to start.

Every plan for Afghanistan carries a three-to-five year optimistic time frame and
at least a ten year realistic one.  Do the American people have that kind of
patience or confidence in our policy makers?  The only viable plan is a sensible
negotiated withdrawal - this time with development aid where the spigot of cash can
keep the warlords from starting another civil war, at least long enough to alleviate the
misery of the ordinary people, who have been suffering for decades.




October 30, 2009

Mr. President:  The market was up sharply yesterday when quarterly GDP numbers
showed positive growth; it is crashing today as the consumer spending report fails to
confirm continuance.  The stimulus has worked to jump start the economy but the
consumer is failing to provide the fuel necessary to keep it growing.  Your policies have
attempted to return us to the status quo ante, but with respect sir, that was the cause of
the disaster in the first place.  There is a good reason why Glass-Steagall functioned
effectively for almost seven decades and why commercial and investment banking should
be separate.  Allowing commercial banks to bet on high-risk / high return derivatives and
similar securities puts the economy at risk and reduces their capacity for commercial
lending.  It is, of course, the latter that fuels the economy.  When the bets turn really sour,
as will eventually happen, it can be catastrophic as we discoverd last year.  You have
chosen to absorb their losses with the public purse without requiring change, so now,quite
naturally, they are further emboldened.

In fact, the system has become such an admixture that Goldman-Sachs, an investment
bank for over a hundred years, has changed itself and chosen to be owned by a pseudo
commercial bank like holding company allowing it to borrow from the Fed -- almost free
money at the current rate.  Hence, their huge profits, all from trading securities, which does
nothing for the economy.  Pardon me, sir, but the expression is, 'being taken for a ride'.

Today, Mr. President, is also the day your generals will be  playing yet more Afghanistan
wargames to engineer the best tactics for defeating the insurgency and to determine force
levels.  Now here is a game for you, Mr. President.  It's the kind of game taught in courses
on optimal decision-making, and, at its core, is not unlike the mind games Einstein
employed when he was developing his theories.  It's very simple:  In this case one would
say,  suppose you have all the men you need and you are able to  pacify Afghanistan.  No
more attacks, and the insurgents are nowhere to be seen, though one cannot completely
disable or disarm them because they simply melt into the population.  Now what?  You
know what'll happen if we leave, so what do we do?

It is precisely because we have not answered these questions, the "end game" as Matthew
Hoh calls it, that he recently resigned rather publicly, and is against putting more young
American lives at risk or causing further death and destruction in Afghanistan - a
Predator's kill ratio according to the latest analysis is 2%, i.e. 98 civilians killed for every
two insurgents.  For several years, a State Department political adviser on the ground in
Afghanistan dealing daily with Afghans, Hoh considers the war unwinnable but he also asks
the fundamental question:  Is it worth winning?

His view:  Al-Qaeda has evolved and now exists mainly on the internet;  training has always
been local to the attacks;  it recruits world-wide thanks to the disaffection engendered by
our actions;  Afghans have not been involved in any of the al-Qaeda attacks;  Afghans are
local and parochial -- they have always resisted authority, and will fight anyone trying to
govern their lives be it a central government or an occupation force; etc., etc.  The last
statement will be confirmed by anyone who has studied Afghanistan.  In other words, our
presence fuels the insurgency.  Mr. President, one hopes you will ponder these issues as
you set about making your decision.

P.S.  Sir, our Secretary of State went to Pakistan to improve relations.  In three days, she
managed to offend even the small minority of the elite who support our efforts.  Is this
another "heckuva-job-Brownie" moment?




October 23, 2009

Mr. President, they are saying now that you are a man who keeps compromising until he
has compromised himself.  Not very nice but the examples being quoted from your political
career give one pause.  One's got to say this about your predecessor: No matter how
wrong or outrageous a decision, George Bush got his way.  Perhaps, there's a lesson
there somewhere.

Sir, your poll ratings are falling off the cliff.  You have had the biggest drop in nine months
of any President in history.  One can only hope change, promised so long, is imminent.  
Here is what people see:

Goldman-Sachs rescued from oblivion reported $3.1 billion in quarterly profits.  Did they
make money from investments which would benefit the economy and the country?  No!  
The profits were made from trading securities.  So, it's back to gambling again, and the
casino now pays back bankrupting losses.  Have we done anything about regulating their
predilection for gambling and quick profits?  No, instead we have made it easier for
Goldman-Sachs to borrow from the Federal Reserve (at almost no interest these days)
because they have decided to become the kind of bank the Fed lends to, and absent
Glass-Steagall, they can.  After the two-decade long deregulation binge bringing us this
mess, we had the kind of crisis where some regulatory order could have been reimposed.  
Unfortunately, the banks, the perpetrators and the facilitators were left in place, some even
brought back into government.  The 'audacity of hope' has become the 'brazenness of
bankers'.  You see, Mr. President, there is a reason your poll ratings are in free fall.

Judge Goldstone's report has been endorsed by the UN Human Rights Council.  A notable
jurist, veteran of investigations in Rwanda, Bosnia and his native South Africa, he is a
Zionist who loves Israel, and only accepted the assignment to investigate humanitarian law
violations in Gaza when his mandate was extended to include any misdeeds by Hamas.  
We dismissed his report as 'flawed and unbalanced'.  He says he is most willing to learn
and wants to know what the 'flaws' are, but so far we have been unable to tell him.

The report is horrendous, as you well know, painful to read, and as you also know, critical
of Hamas and of Israel.  But Israel's military stands out and not positively.  Even such
respected organs as The Financial Times of London, a strong supporter of Israel,
considers the report balanced.  None of our three major European allies voted with us
against endorsement and we mustered a mere six votes out of forty-two cast.

One would have thought this was the ultimate leverage to face down Netanyahou on
settlements.  But he will continue building and the talks are stalled.  For the Palestinians,
it's like trying to divide a pizza with someone who keeps wolfing it down while one is still
trying to agree on the portions.  Ultimately, Israel is likely to have a severe case of
indigestion.  Peace activists in Israel are sorely disappointed.  Mr. Mitchell, the fabled
peacemaker, seems to have disappeared over the horizon.

Mr. President, forgive me for saying so, but when are you going to stand up for us who
took you the White House?  So far the health industry, the banks, the hawks on the war,
and even Netanyahou have all faced you down, or you have taken their side.  It makes us,
the public, very unhappy and the polls reflect it.



October 16, 2009

Winning the Nobel Peace Prize, Mr. President, also shoulders responsibility on
the recipient to maintain a certain authenticity.  You have been to the UN
recently, and I wonder if you gave a glance to this poem at the entrance to the
Hall of Nations:

Human beings are members of a whole
In creation of one essence and soul.
If one member is afflicted with pain
Other members uneasy will remain.
If you have no sympathy for human pain
The name of human you cannot retain.

~ Saadi (1207? - 1291) of Shiraz, Iran

The Iranians have a long history and storied civilization.  The question is whether
the world of today, and we in particular with about a thousand military bases
girdling it attesting our uncontested might, are worthy of Saadi's 13th century
invocation.

I am thinking also of Iranian king, Cyrus, who showed remarkable religious
tolerance for the time (539 BC) and exceptional generosity in liberating enslaved
Jews in Babylon and offering to repatriate them to Jerusalem.  They went on to
build the second temple which was destroyed by the Romans.  How the world has
changed?

Modern Israel offers a stark contrast in the second class treatment of its Arab
citizenry and apartheid-like treatment (in former President Carter's words) of
occupied Palestinians with check points, identity cards, separate license plates,
designated areas with permits required to move, etc.

Israel comes to mind because it is in the news today:  this morning the UN Human
Rights Council endorsed the Goldstone report and forwarded it to the UN
General Assembly.  The vote was 25 for, 6 against with 11 abstentions.  The
abstentions were significant because many of these countries usually voted for
Israel.  The Israeli military's wanton behavior as depicted in the report, which also
condemns Hamas for its rocket attacks, has disappointed and disillusioned many
friends who wish for nothing more than peace in the area.

Mr. Goldstone, a distinguished South African jurist with a long record of
defending human rights, is a Jew and a strong supporter of Israel, but, as he
says, of a law-abiding Israel that takes its obligations under international law
seriously.

Mr. President, we did not distinguish ourselves too well in this episode having
tried to bury the report with economic pressure on Pakistan and the Palestinian
President.  They were then instrumental in postponing the initial resolution.  Now,
that the report has been forwarded, it sets the clock ticking on Israel and Hamas
to start credible investigations.  Failure to comply could lead to investigation by
the International Criminal Court.

Today is also World Food Day and a reminder that one in six in our world (i.e. over
a billion) will go to bed hungry tonight and every night.  Jacques Diouf the
Director General of the UN's Food and Agriculture Organization in Rome says we
need about $44 billion in aid to agriculture.  Contrast this to the one and a half
trillion in military expenditures and we get a sense of the distorted priorities
plaguing the human race.  One should also add that developed countries
distribute $365 billion in subsidies to farming, distorting price and severely
hurting subsistence farmers in the developing world.  More than anything else,
what they need are storage facilities to prevent spoilage and infrastructure to
speed transportation.   Something to alleviate world hunger, Mr. President, would
echo Saadi's invocation, and indeed be worthy of a peace prize.





October 9, 2009

Congratulations Mr. President!  Who would have thought... but then I understand
your staff was equally stunned and you were humbled.  It is too happy a day for
me to be churlish and introduce the problems facing us.

Some are saying you haven't done anything yet but I say it's anticipatory.  Wangari
Maathai, a Kenyan like your father and a 2004 Nobel Peace Laureate, when asked
to comment, expressed her surprise and thought too the Committee was
anticipating your future accomplishments.  It's an "understandable dynamic"
(whatever that means) in TV pundit speak and the language of diplomats.

Some are saying, if they are giving it to you, it should be called a "War Prize".  But
I say, to bring peace you use the tools of our American heritage.  In the riotous
nineteenth century the Colt 45 was our "peacemaker", and in the twentieth, we
assigned the name to a powerful ICBM with a hydrogen bomb in its nose.  A
sneeze from that would have rid us of innumerable verminous Commies.

Some are saying, it is a repudiation of George W. Bush, who was universally
hated in liberal Western Europe, but I say give credit where it's due -- it is a
manifestation of the power of the spoken word.  So, once again Mr. President,
congratulations and sleep easy.  The world brims with confidence in your capacity
for solving its problems.  After all, miracles never cease: the deadline for
nominations was a mere eleven days after your inauguration.


October 2, 2009

"Three strikes you're out," is ingrained in our psyche.  Be careful Mr. President,
the American public has a low tolerance threshold.  Another strike is being called
against you.  This time it's the ill-fated effort on behalf of Chicago's bid.  Well, it
was a gallant try.  Unfortunately, many people believe you laid our country's and
your prestige on the line.  You made it our country's bid instead of just Chicago's,
and we were all snubbed.

The rescue of our economy handed over to the people who caused the problem
in the first place is another source of much disaffection.  The propped-up major
banks recording profits set aside to offset the toxic assets, still on the books at
purchase price, is a major problem as the banks have little left over to lend and
stimulate the economy.  As a result, people are still seeing neighbors being laid
off and are naturally saving for their own rainy day.  Let me be generous and give
you a single on the economy.  Handled right, it could have been a home run and
you can't say you did not know.  Several Nobel Laureates in Economics were
screaming out their messages and warnings.

The health care bills in Congress do next to nothing to solve the problem.  
Adding the uninsured is in fact likely to exacerbate it. It takes on average three
weeks to see a primary care provider these days.  No wonder the emergency
rooms are overused.  Our procedure-based payment system underpays family
doctors, and consequently fewer and fewer are choosing that area while
specialists are multiplying.  Chronic disease is poorly managed leading to
unnecessary acute problems and enormous cost.  Thus, the diabetic ends up
getting amputations, the hypertensive has a stroke.

Secondly, the real problem, namely the system itself, is not addressed at all.  We
focus on profit instead of care.  The providers are in competition with each other
for the patient dollar instead of collaborating towards patient well-being.  Thus, if
a hospital has a record of treating some condition particularly well, it is reluctant
to share its protocol with a competing hospital;  instead, this becomes
proprietary information and is guarded like an industrial secret.  Of course the
hospitals, no longer non-profit community-run but bought up by large
corporations as the Medicare and other government programs turned on the
spigot of cash, are free to set their own prices.  Hence the $100 aspirin tablet.  I
hasten to add I am in favor of Medicare, it's the hospitals and other providers
that need a referee.  For all these reasons 70% of Americans wanted a single-
payer plan.  And we sent you, Mr. President, up there to get it for us.  Sad to say,
you did not even try.  Strike two.

On Afghanistan, the pressure is to escalate is increasing.  You leaped in without
a careful look and are now paying the price.  Of course neighboring Pakistan has
been doing so for a while.  This issue has been addressed so many times that I
refer you to earlier letters.  The question is, will it be strike three?

A small note, Mr. President.  Today is Gandhi's 140th birth anniversary.  If he
could bring the British Empire to its knees with non-violence, the Taleban should
not be a problem.  It is time to negotiate.



September 25, 2009

This week a leak raised the ante.  Three weeks ago we were told that to win in
Afghanistan we would need more troops.  Now we are told that if more troops are
not provided forthwith, we will not only relinquish any gains made but we will
lose.  The ghosts of Vietnam and General Westmoreland are upon us.

Exactly what are we doing in Afghanistan?  Do we have well-defined objectives
and a coherent strategy?  We have imposed essentially a minority Tajik
government on the Pashtoons who comprise 42% of the population (and more if
one includes those living on the other side of the porous, locally unrecognized
border); the Tajiks make up 24%.  In eight years we have not developed the
wherewithal to hold free and fair elections with people not afraid to vote -- their
fear explains the abysmal turnout leading to the stuffing of ballot boxes with
fictitious votes.

It is claimed that we want an al-Qaeda free Afghanistan.  But in this global internet
connected world,  al-Qaeda can just as well direct operatives in Berlin, Paris or
London.  All they need is an apartment and a computer.  To catch them requires
good old-fashioned police work not a huge military.  It was our internal policing
apparatus that failed against the 9/11 hijackers when they received their flight
training and laid their plans here in the US.

Given what it cost them, it is doubtful the Taleban will again allow al-Qaeda the
same latitude in Afghanistan.  The time has come for a face-saving
accommodation and an honorable retreat.  Forgive me, Mr. President, but leaping
without looking can have disastrous effects.  Now it is going to take enormous
amounts of political courage to reverse policy and defy the generals.

Another leak this week -- this time on the economic front -- informs us that the
financial overhaul being contemplated by your staff retains the "too-big-to-fail"
concept.  Quite simply, it's a bad idea.  It gives the favored banks an implicit
government guarantee and thus an unfair competitive advantage over their
rivals.  It will ensure the big banks get bigger, and reduce competition in the
market at the expense of consumers.  And it's a sure fire recipe for greater
hubris, another fall, and another bailout.

After the hoopla and histrionics at the UN, the two-day G-20 summit starting today
will be a sober contrast.  Changing realities, changing economic strengths -
France wields 4.9% of IMF votes, China 3.7%, when China's economy is 50%
larger.  Clearly world institutions need restructuring to reflect the new
environment.  China has recovered quickly from the crisis and is fast becoming a
driver of the world economy.  We have to get our own house in order, Mr.
President.



September 18, 2009

The Baucus bill is out.  It is flawed -- too many flaws to be precise.  First the
public option intended as help for less than five percent, but more importantly
directed at keeping insurance companies in check has disappeared.  Replaced
by a co-op alternative that is specifically forbidden to negotiate lower prices -- so
much for cost control.

Next, the plan stratifies enrollees thereby forming five small pools of members
divided by risk and likely to make insurance unaffordable for the higher risk
group, namely, the middle-aged and older.  The benefits of having one large pool
whereby the premiums from the low risk members help defray the costs of the
rest are lost.

The plan does next to nothing to tackle the cost control problem.  We pay, on
average, twice per capita in comparison with other advanced countries for worse
outcomes.  Without doubt our health care delivery systems need a serious
overhaul.  If the CEO of a health care company pays himself a billion dollars - and
this is not idle conjecture - the cost is eventually borne by the consumers.  The
same applies to excessive hospital fees, doctors' fees, laboratory and radiology
fees, etc.  And the situation has become markedly worse in the last dozen years.  
It is the cause of Medicare's woes and a serious factor in diminishing the
competitiveness of our industries.  You, Mr. President, have witnessed it first-
hand with GM, where heath care costs were one of the significant factors in its
demise.  Quite clearly, we need a referee in the system to prevent such
exorbitant extortion.

In Afghanistan the news is that at least a quarter, if not more, of the votes cast in
the election were fraudulent.  So, after eight years, thousands of lives and
billions of dollars, we are unable to hold a fair election.  Participation rates were
abysmally low thanks to the Taleban threats.  As Afghans put it, this government
is the most corrupt they have seen, so why bother to vote in a choice between a
couple of insiders.  What are we doing there, Mr. President?  What is our ultimate
objective, and is it realistic?  The daily cost in lives and treasure demands clear
answers.



September 11, 2009

It was a masterful speech, Mr. President.  Congratulations!  Of the two aspects of
health care reform, namely, access and cost of delivery, I commend you for
addressing and reassuring all the involved parties on the access question.  On
health care delivery, I think you will agree we have a serious problem.  We spend
twice as much per capita as other industrialized nations for an outcome that is
comparatively abysmal on a national basis.

We are hobbled by multiple for-profit insurers and providers, each keeping
separate sets of records.  Patients moving from one doctor to another often
repeat tests.  Hospitals paid per procedure are inclined to maximize them.  
Numerous investigations have revealed a culture of unnecessary over-testing
and medication resulting in an every increasing spiral of costs and premiums,
and causing problems throughout the economy.

Quite clearly the best experts of both Republican and Democratic persuasion
need to come together to address this problem.  Other countries offer models for
study varying from fully government owned facilities and salaried staff to closely
supervised independents.  It is evident major structural changes will not be
forthcoming at this juncture but a detailed report with recommendations before
the next election would certainly put some heat on Congressmen and Senators.  
We have to fundamentally change the distorted incentives of a fee-for-service
system.

Mr. President, we observe today the anniversary of the senseless 9/11 attack.  As
we pay our respects, we need also to ask ourselves what we are doing in
Afghanistan.  What exactly is our objective bearing in mind that no Afghans were
ever involved and have never been implicated in any acts of international
terrorism?  Some say we want a safe Afghanistan with a government that will
never be a sanctuary for al-Qaeda.

It begs the question, what is al-Qaeda?  There is al-Qaeda in Somalia, Iraq,
Morocco and elsewhere.  There are extremist sympathizers in Europe and the
British have just recently convicted a group planning to down some planes.  All it
takes in the internet age is a computer and a place to stay.  On the face of it, the
job calls for police skills rather than military might.  Al-Qaeda itself has apparently
become a franchised idea.

In Afghanistan -- and not unlike Latin American civil wars -- our soldiers visit
villages during the day and the Taleban visit at night.  We promise development
and the Taleban guarantee death to 'collaborators'.  The poor Afghan caught in
the middle just wants to be left alone.  They have a government that is more
corrupt than the Taleban and the recent elections are tainted.  It is a difficult problem,
Mr. President and you would have my sympathy but for the fact that you have made it
worse by injecting it into Pakistan as well.  It has created millions of refugees.  Some are
being told they can go back.  But what have they to go back to?  Their crops and homes
destroyed, livestock dead - for subsistence farmers, it's a death warrant.

Mr. Gorbachev tried but could not extricate himself gracefully from Afghanistan.  In the end
the Russians were simply kicked out.  Let's hope we can negotiate a face-saving
agreement.





September 4, 2009

"The best laid schemes o' mice an' men
Gang aft agley" (Robert Burns)

And the poem ends
"But och backward I cast my e'e
On prospects drear!
An' forward, tho' I canna see,
I guess an' fear."

Mr. President, the quotes, from this poem to a mouse, seem to be a perfect metaphor for
our Afghanistan policy.  I write this today when scores of civilians have again been killed in
an air strike - this time on two tanker trucks hijacked earlier by insurgents.  As we continue
to play into their hands and offer them more and more recruits with out actions, the war is
not going well.  That appears to be the gist of your commander's report (Commentary for
Sept 2, 2009 on this site offers a discussion).

We say we are fighting the Taleban who sheltered al-Qaeda.  In fact they sheltered foreign
fighters - lauded by President Reagan at the time - who helped them expel the Soviets.  Al-
Qaeda itself has no formal organizational structure and seems to have become an idea.  
So we have al-Qaeda in Iraq, in Yemen, in Somalia, etc.  It is logical to ask, if we must fight
in Afghanistan, why not the other places?

The people we are fighting, Pashtoons, live on both sides of a porous border drawn up
arbitrarily by the British and not recognized by the locals.  Families live on both sides and
cross freely - now somewhat hampered by unpopular militaries.  No Pashtoon has ever
been involved in any international terrorism.  Their quarrel is with the Tajik dominated
central government and our support of it and presence there.  Yet, we have forced
Pakistan to violate its treaties with the semi-autonomous Pashtoon tribes living in FATA
(Federally Administered Tribal Areas) and attack them.  As a result the largely semi-literate
conservatively religious tribes, whose members often come down to seek construction and
other such jobs in Pakistan proper, are in revolt.

Before 2004, there were no attacks in Pakistan and no Taleban there; now it is suffering
continual suicide bombings with a couple of dozen Taleban groups claiming responsibility.  
The heavy-handed approach required by us of the Pakistan military in Swat to combat a
few thousand, whose presence in the valley was a direct result of the earlier army offensive
in the tribal areas, has caused devastation on a scale never seen before in Swat. Homes,
orchards (which take years to grow), livestock destroyed and estimates of two to four
million refugees.  The estimates vary because many have moved in with families in other
parts of Pakistan.

Since the border police/military is drawn mainly from local populations, Pakistan is in the
midst of a defacto civil war in Balochistan and the Frontier provinces.  Without the
resources for such a protracted conflict and dependent on Balochistan for natural gas
suppplies, it is also facing economic collapse.

There is zero support for the war among liberals here, and now respected Republican
commentators are calling for halt and withdrawal.  Mr. President, the country is telling you
something:  it is time for dialogue with the insurgents and the planning for a face-saving
departure.


August 28, 2009

It has been a sad week, Mr. President.  Senator Kennedy passed away on
Wednesday.  His endorsement of your candidacy at the critical juncture in the
primaries when Hilary Clinton was ready to sweep some large states where your
organization had not been able to commit many resources helped save your
candidacy. And I am sure you have never forgotten.  His life's dream was
universal health care for Americans.  I hope you are able to honor his memory by
pushing through a plan that would have met his standards.

'Pushing through' are the key words, Mr. President.  President Johnson's efforts
are legendary.  His carrot and stick, his charm and arm-twisting, his willingness to
get down and dirty in the rough and tumble of back room politics got us
Medicare, one of the most popular government programs in the country, and the
other Great Society legislation.

As you continue your vacation in Martha's Vineyard, I hope you can ponder these
issues, so we can have meaningful reform in health care.  By the way, a recent
report out in Europe validates the benefits of a vacation particularly when one is
able to set aside the rigors of daily existence.  If you are able to recharge your
batteries, Sir, the tax payers will be amply rewarded for the $30K - $50K per week
they are being billed for the rental of the vacation quarters for you and the
necessary staff.



August 21, 2009

Mr. President: Polls show that two-thirds to 70 percent of Americans favor a
single-payer health plan but we are arguing about minor tweaks in an
unsustainable system.  There are even assessments reporting over 20,000
deaths in our country due to inaccessible health care - the uninsured, the under
insured, the people sacrificing their lives to avoid bankrupting the family; there
are all kinds of heroes out there, though not in the health care industry.  It is a
national scandal.  Yet, our elected representatives are unable to devise a plan
that would resolve these issues.  Even you Mr. President - forgive me for saying
so - have backed off and backed off until there are hardly any substantial
changes left, and they are still pushing.  Senator Grassley is out talking about
"pulling the plug on Grandma" and "rationing" care for the elderly in Britain (see
the Commentary section, August 19, 2009).  Such blatant falsehoods seem to be
sticking, if one goes by the comments at town hall meetings and internet forums.

Britain is ranked far ahead of us in the WHO survey of health care systems.  France is #1,
Spain is #7; we are #37 just ahead of Slovenia and quite a way behind Morocco and
Oman.  They have not-for-profit or single-payer systems; we do not.   If you get sick there,
you go to a doctor of your choice; if you have an emergency - appendicitis, for example -
you go to the hospital.  That's it.  They take care of you - no bills, no pre-approvals and no
designated lists of doctors and hospitals from your insurer.  Per capita, most of the
countries spend half of what we do.  How do they do it? They have taken out the profit and
they do not need the layers of bureaucracy at insurers, HMOs or hospitals.  No bills
charging $100 for an aspirin tablet from the latter.

When the people are crying out for decent health care, and are being thwarted by for-
profit insurers and health care providers and their armies of lobbyists, our system of
government begs the question:  Do we have representative democracy?  Arundhati Roy
had an interesting phrase to describe India's system of governance.  She called it a "used-
up democracy" because it is now so beholden to corporate interests, it no longer
represents the majority of the people.  So, forgive me for asking you, Mr. President:  have
we become a "used-up democracy"?



August 14, 2009

Mr. President, congratulations to the Medal of Freedom winners and to you for an
eclectic and impressive choice - with one continual omission, a man responsible
for saving more lives since Louis Pasteur, pasteurized milk, and the discovery of
vaccination.  Ralph Nader single-handedly forced safety devices on the largest
corporation in the world, GM (at the time), and the other automobile
manufacturers, in a situation where market forces failed (much like health care
today) to generate an optimum.  It would also have been graceful as he ran
against you Mr. President.  Perhaps next time.

August 14/15 pass by unnoticed here but they are celebrated as Independence
days by almost a billion and a half on the Indian subcontinent.  From the brutal
communal violence during the pangs of birth to two heavily armed nuclear
adversaries, the basic hostility between them continues and given their nuclear
weapons represent a threat to the world.  Kashmir remains a tinder box of
parched sorrow with scores of thousands dead and disappeared.  The situation
begs for muscular diplomacy.

The health care debate has deteriorated into name calling and disruptions at
town hall events -- in your case a misguided man with a loaded gun and a
threatening sign all set to defend his freedom probably as a result of the virulent
talk show host commentaries that make a mockery of truth.

To senior citizens the worry is the money you plan to take out of Medicare.  No
question there are savings to be extracted in a pay-for-service system.  By its
nature it encourages providers to do more than truly necessary.  The June 1,
2009 New Yorker carries an article, "The Cost Conundrum," on this very point.  It
explains how expensive procedures are now performed routinely when in the
past, the patient would simply be sent home.

The second problem is the for-profit nature of our health system.  Some say it
leads to innovation.  They seem to overlook the fact that some of the largest
pharmaceutical companies are Europe based; that they have in the past and will
continue to produce a stream of new drugs.  The ubiquitous CAT scan was
developed initially by engineers in Britain and subsequently bought by GE and
refined.  Moreover, we can hardly be considered innovative in delivery systems
when we spend 250% more per capita than other industrialized countries for
inferior overall-results.

Have a happy vacation, Mr. President.




August 7, 2009

Mr. President, Happy Birthday.  Everyone hopes you had a wonderful day last
Monday.

Also this week on August 6, the Japanese and the world commemorated the
atomic bombing of Hiroshima and all the horror it wrought.  How necessary it was,
is still being debated but one thing is for certain:  in a flash of a second several
hundred thousand people were killed or maimed in one of the most horrific
incidents in human history.  Barely given the chance for the machinery of their
government to respond,  Japanese civilians in Nagasaki were also administered
a dose of the same horror.

We seem to have developed fantastical technologies, Mr. President, yet our
behaviors are mired in a primitive threat-attack-and-response syndrome not
unlike chimps defending or extending their territories.  Sixty-four years after
Hiroshima and Nagasaki our aggressions and mute submissions remain exactly as
they were that hot August day.

This was evident as we played North Korea's tune and served up Bill Clinton and
Al Gore as errand boys to hand Mr. It-Pays-to-Have-a-Nuke Kim Jong Il  a
propaganda coup.  Contrast the treatment Iran is receiving and it will be no
surprise if, contrary to their expressed beliefs, they decide ultimately to go nuclear as a
safety measure.

The hot, humid days of August are upon us.  Congress has disappeared into Junketland
and the news cycle is in its usual summer doldrums.  Hope you too, Mr. President, have a
great vacation / staycation - the later seems to be the new recession holiday.



July 31, 2009

Mr. President:  They say, there is a right way and a wrong way; there is no half-
right-half-wrong way because when something is half-wrong, it cannot possibly
be right.  This comes to mind because of a recent article in Harper's:  Titled
"Barack Hoover Obama" with a front cover dressing you up in Herbert Hoover's
clothes, the article lauds your good intentions but questions the likelihood of
your success; in fact, it predicts failure.

Herbert Hoover was not only a real rags to riches success story but an early
hands-on philanthropist.  Orphaned and penniless at nine, he was brought up by
an uncle who employed him as an office boy when he was fourteen.  On his own
he continued at night school, and secured admission at Stanford to study
Geology and Engineering.  He paid his way doing all kinds of jobs and running
several small businesses.  After graduation, he worked as a mining engineer
across the world, and eventually, Indiana Jones style, he discovered a long
forgotten silver mine in Burma which made him a small fortune.

In China and besieged in the Boxer rebellion, he and his wife nevertheless found
a way to smuggle food to Chinese Christians trapped in another part of the city.  
During the Great War, he was prominent in leading the effort to feed the
distressed people of occupied France and Belgium.  He donated part of his
fortune and risked his life, time and again, crossing the U-boat threatened
Atlantic.

With such a resume, both parties wanted to run him for President.  When he was
elected, the people were confident he, the engineer, would solve all their
problems.  So, what happened?  With great insight, Hoover foresaw the effort
needed.  He met with hundreds of business leaders, encouraged public and
private projects, in fact, his Reconstruction Finance Corporation was allotted a
then unthinkable $2 billion to help banks and railroads stay afloat. It was a bold
program but it never worked.  The business leaders made promises but went
home to slash jobs and cut spending, possibly as a result of market forces.  The
banks simply shored up their balance sheets -- much as now -- instead of lending
to stimulate the economy.  The projects got going at a snail's pace.

As it turned out, the 'New Deal' was substantially what Hoover had started but it
took Roosevelt to give it teeth.  He endorsed reforms regulating the banks and
Wall Street, and backed labor as a countervailing force to business.  Employed
workers with a paycheck are able to spend more, and bank lending stimulates the
economy.  Still, it took Roosevelt's willingness to take on the power brokers to
get there.  Consensus is well and good but an equitable solution to problems
takes a balance of power between the parties involved.

We all know what the banks need to do.  We all know what Congress needs to do
in health care.  The question, Mr. President, is whether you can set up the
necessary countervailing forces to persuade them.  Unfairly maybe, but history
can be unforgiving:  President Hoover, a good, kind, brilliant and great man, a
hero and champion of humanity, is remembered chiefly as a disappointing failure.




July 24, 2009

Mr. President:  This week the Attorney General of Minnesota won a significant
victory on behalf of consumers.  A release of ownership records revealed that
the arbitrators (National Arbitration Forum) had ties to the creditors.  The poor
consumer gets it coming and going from usurious interest rates to crooked
forced arbitration.  Now is the time, Mr. President, to pass legislation against
forced arbitration in credit card (and other such) contracts.

We all enjoyed your press conference this week and thank you for your
invitation/reminder to watch.  You will forgive me, Mr. President, if I liken your
health care plan to putting a coat of paint on a rusty bucket.  In this case, sadly,
the bucket also has a hole; it will be just as difficult to ferry water.  From the blog
posts and comments you appear to have lost many of your regular supporters
because they see no significant change.  All we see is a battle of wills between a
majority of Democrats and the Republicans with the latter wanting to hand you a
defeat.  Either way the insurers come out ahead just as the banks did.  A major
story yesterday concerned the 27 meetings you have had with senior health
industry executives.  So far no reports of any with anyone representing us -
Representative Conyers for example?

Mr. President, the war in Afghanistan continues as do the killings in Iraq.  Drone
activity along the Af-Pak border is at a new high. Yet a memo leaked recently
disclosed the British Chief of Staff's assessment that the Afghan War had already
been lost and was no longer winnable.  We can still bomb them to smithereens,
have a six-month drop in insurgent activity, declare victory and leave. To what
end?

It seems to this observer that every US President should have in the Oval Office
two things: a copy of Kurt Vonnegut's "Slaughterhouse Five" on a side-table for
continual reference and a copy of Picasso's "Guernica" on the wall.  Perhaps
Madrid's Museo Nacional Centro de Arte Reina Sofia can lend the original as a
service.  The painting recalls the attack on the Basque city of Guernica one
sunny afternoon - the Basques were resolutely opposed to Franco - over 70
years ago.  Exhibited first at the Paris World's Fair 1937, it had little effect on
those who bombed London, Coventry, Dresden, Tokyo, Hiroshima or Nagasaki.  
Perhaps it will help us redraw a long forgotten line between civilian and
combatant.

Living in a period where human values have disintegrated, we could learn from
Vonnegut and Picasso.  The former recalls the fire bombing horror visited on the
entirely civilian population of Dresden, where he as a P.O.W. continued to be
treated civilly despite what his compatriots had wreaked.  Picasso displays the
fragments from the destruction of innocents, animal and human, viewed through
the distorting mirror of our compromised values.  It is a lesson not to be
forgotten, and therefore needs to be ever present.

Finally, Mr. President, if the past is any indicator (and the sages surely tell us), it
is better to build than to destroy for a lasting legacy.















Pablo Picasso, Guernica, 1937 (Oil on canvas)




July 17, 2009

Letter to the President                 

Last week Mr. President, this letter suggested the Chinese economy was
humming along nicely after barely a hiccup.  Well, this week the figures are in: the
Chinese have resumed their growth - a 7.9% rate in the last quarter.  Their foreign
exchange reserves, mostly dollar denominated, have risen to $2.13 trillion.  One
has to wonder who has leverage over whom.

Why have the Chinese recovered so quickly?  The answer is two words: "toxic
assets".  Their banks do not have any; ours do.  Citigroup's report a little over a
month ago demonstrated clearly their effect when they set aside 90% of profits in
a loan loss reserve. That left a paltry 10% for any lending activity to stimulate the
economy.  I am afraid you, Mr. President, are being given a run around by the
Citigroup and Goldman-Sachs cabal while they are doing little for the economy
and making out like bandits.

This week also Goldman-Sachs reported profits exceeding analysts' expectations
and bonuses to their 28,000 employees averaging three quarters of a million
dollars.  There was a time when investment banks sought out the most profitable
industries; no more.  Now money is made slicing, dicing, packaging, moving,
buying and selling paper.  Instead of weeding out inefficient industry, the
activities of these banks have led to overpriced housing now lying vacant.

It seems like the banks are back to their old ways.  We had the best opportunity in
decades to set up a strong regulatory domain and we gave them a blank check.  
When profits are private and the bill for losses landed to the public the least we
can expect is a rein on egregious behavior.  Forgive me, Mr. President, but your
proposals leave far too many loopholes.



July 10, 2009

The G8 summit is over and if we have learned anything, it is how the mighty have
fallen.  Not only can we do little about climate change without help from Brazil,
China and India, but we also might need their help to pull us out of this deep
recession.  There was a time when ...., if we caught a cold, they (and the rest of
the world) got pneumonia.  No more.  After barely a hiccup, their economies, have
started to hum nicely while the G8 countries remain adrift in the doldrums.

Mr. President,  on climate change everyone is going to try to try!  On the
economic front, the engines driving Europe already have sophisticated and
generous systems in place for hard times, and these governments can not spend
much more.  It seems we are the center in both cause and remedy.  
Unfortunately, feeding the systems and institutions that caused this catastrophe
-- for that is what it is for millions -- is probably the least efficient means of
addressing the problem.

By the way, Mr. President, perhaps it is adversity but for some reason members
of your administration manifest an adroit, almost Orwellian, sense of euphemism;
the latest being "legacy assets" as a term for the worthless mortgage-backed
securities held by the banks.  Whose legacy, is a question worth pondering.  One
hopes you will put a stop to it.

Finally, Mr. President, congratulations on your latest web page offering, a place
for people to vent their frustration with health insurers.

http://stories.barackobama.com/healthcare

The horror stories, mostly from people who carried insurance merely underline
the importance of a closely supervised single-payer system, or at a distant
second, carefully and strictly regulated insurers.

Welcome back home, Mr. President.  It was a pleasure to have an articulate,
personable and generally sympathetic figure representing us.  



July 3, 2009

Mr. President, the course of the economy outlined in the June 12th letter
appears to be confirmed in the new unemployment figures - greeted by Wall
Street with a significant down day.  The predicted job losses were 40% off the
mark and the reported unemployment rate of 9.5% a twenty-five year high.  Of
course if we include the discouraged who have given up looking for a job
because they can't find one, the forced part-timers and contract workers the
figure almost doubles and is the highest since 1948.

While the economy will eventually take a turn, the question is whether we can
return it to the robust growth we experienced before the downturn.  Here the
toxic assets millstone and the missed opportunity of instituting on effective
international system of capital markets governance is likely to hobble us for
some time to come.

Forgive me, Mr. President, but if one's economic advisers and Treasury officials
are either proteges of, or belonging to the cabal that brought this economic
disaster down upon us, one cannot expect radical necessary changes from their
mind-set.  On the other hand, Mr. President, it is difficult to blame a young man,
albeit well-intentioned, who goes to Washington without a developed
constituency, and is forced to rely on party power brokers.

________________________________________________________________________

The good news this week for which you and many others are grateful --- Al
Franken is finally certified as the Senator from Minnesota and your party has a
filibuster-proof majority.  Your comments, however, do not bode well for those
seeking meaningful health care reform.

The band-aids being plastered all over a wide gaping wound will not alter the
basic facts with regard to health care: the headaches of myriad bills will continue,
the refusal of insurers to pay and subsequent fights costing crucial time, effort
and money during serious illness will continue, bankruptcies due to health care
bills (at present 62%) will continue, etc., etc.

What surprises most of us is how your administration has not even attempted to
take on any of the special interest groups, the bankers, the insurers and the
right-wing (often extreme) supporters of Israel.

________________________________________________________________________


The war in Afghanistan is heating up with Operation Khanjar (Strike the Sword) ---  
nobody informed the Generals that khanjar means a curved dagger, which
certainly does not bolster confidence in the quality of our intelligence.  How this
operation will win hearts and minds is not clear; particularly, the ridiculous
patronizing tale of the general out to buy watermelons.  It is quite likely that in
each family someone or another, fed up with the occupation and the corrupt
government it supports, has joined up with the Taleban.  Killing that person will
not endear us to his mother, his siblings, his cousins, uncles, aunts, friends and
others in his orbit.  Just as Iraq is imploding, we bring the same tired techniques
to Afghanistan.  .

On this holiday weekend, have a happy Fourth, Mr. President.  You may wish to
ponder the last part of Robert Lowell's poem written in 1967 (reproduced below),
and also reflect on the desire of our founding fathers that we avoid the European
penchant for war.


....  No weekends for the gods now.  Wars
flicker, earth licks its open sores,
fresh breakage, fresh promotions, chance
assassinations, no advance.
Only man thinning out his kind
sounds through the Sabbath noon, the blind
swipe  of the pruner and his knife
busy about the tree of life ...

Pity the planet, all joy gone
from this sweet volcanic cone;
peace to our children when they fall
in small war on the heels of small
war -- until the end of time
to police the earth, a ghost
orbiting forever lost
in our monotonous sublime.

.... Robert Lowell --- (1967)





June 26, 2009

The spate of bombings in Iraq and the escalation in Af-Pak are a reminder that
one can keep patching a leaking roof but eventually it has to be replaced.  
Forgive the trite analogy, Mr. President, but it happens to be my current problem
when money is tight and the future uncertain -- the latter annoying because the
economic ship could have been righted and prevented from listing precariously.  
We can buy off the Sunnis in Iraq temporarily, but it doesn't solve the problem;
we can pay off some of the tribal chiefs in Af-Pak but it can never be a recipe for
a stable Afghanistan.

Mr. President, you rightfully condemned this week the death of seven
demonstrators in Iran.  The previous day though 45 people were killed at a
funeral in Afghanistan by a drone strike.  What have we become when we attack
funerals?  One cannot help but ask if any of the easily replaceable tin-pot mullahs
and faction leaders can be so important that we can no longer afford the basic
universal human civility of respect for the dead.  Homer recounts the story of
Achilles, killing Hector in battle then desecrating his body --- tying it to his chariot
and dragging it across the field before Troy.  As one might recall, the gods were
not pleased.  Time and again the policy of bombing civilians has been found to
anger the population, making it more determined to resist.  Not only is it
impractical, losing us hearts and minds, but the morality is dubitable.

This year the Red Cross celebrates a century and a half of operation.  Henri
Dunant witnessing the Battle of Solferino and its carnage - 40,000 soldiers and
one civilian - in 1859 during the Italian wars of independence was so moved by
the dead and the cries of the dying, he founded the Red Cross to ameliorate such
suffering.  On this 150th anniversary, they have issued a report "Our World:  
Views from the Field" and its findings are not unexpected:  "Civilians now in the
21st century suffer the brunt of war," affirms Pierre Krahenbuhl, the current Red
Cross Operations Director in a one-line summary.

Here is the question, Mr. President:  If in 1859, the ratio of military to civilian
deaths was 40,000 to one, and if now civilian deaths are in the majority, how have
we  become more civilized in the intervening century-and-a-half?

The number 150 coincidentally is also the landmark in days just crossed by your
Presidency.  It means, of course, that very soon the Af-Pak insurgency, Iraqi
instability and our precarious economy will all in the public mind carry your
stamp.  You will have complete ownership of the Bush legacy including the Iran
destabilization agenda.

The first whiffs are in the air, and the scent evident in the recent poll numbers.  
The Republicans will no doubt get bolder as will the blue-dog Democrats.  We all
hope your freedom to act, Mr. President, is not much hampered, and we wish you
well.





June 19, 2009

Mr. President, your regulatory proposals unveiled this week are laudable in some
aspects.  The question to ask oneself is a simple one:  Would the current crisis
have been prevented had they been in place?  The answer is not clear and that,
Mr. President, given the scope of the present economic mess, is not good
enough.  You have proposed 5% participatory requirements, George Soros has
been calling for 10%, and I would say to you Glass-Steagall did very well by us for
a half-century and more.  We should bring it back.  Gambling, where profits are
private and the losses public (so far about $30,000 per capita in the present
escapade) is not an option.

Having a maze of regulators is another problem particularly when giant
corporations have multiple businesses and can thus pick and choose from
among them.  True reform requires Rooseveltian steps --- as we dawdle the new
economic powers (China, India, Brazil) continue their growth after barely a
hiccup; now they seem to be self-sustaining and not entirely dependent on us.

-------------------------------------------------------------------------------------------------------------------

The demonstrations protesting the election result in Iran continue .  The
'moderate' Mr. Mousavi, a friend and early supporter of the late Ayatollah
Khomeini, used to be labeled a hard-liner.  His reason for running apparently was
Iran's extremist image abroad because of Mr. Ahmadinejad.  Could we have
expected a change in policy if he had been declared the winner?  It seems
unlikely given the ultimate authority, the Supreme Leader, remains the same.

However, the massive demonstrations, clearly an outpouring of simmering anger
at the regime, have changed the equation.  The fractious divisions amongst the
political leadership makes the theocracy feel vulnerable, and the government
might well seek some kind rapprochement to wave Neville-Chamberlain-like at
the public.  We have to seize the moment, Mr. President, but let's be fair so that
whatever agreement we achieve is lasting.



June 12, 2009

It appears, Mr. President, we are just about hitting the period of disillusionment.  
They say the onset of recession triggers a response from the government and
the market reacts positively.  The euphoria continues until facts and figures belie
the efficacy of the government response and the market begins another slide.  
Some say it is so bad this time, we are in for a period of deflation and your
measures to push the economy out of recession is like playing pool with a rope.  
Others claim there is life in the old mule and a good kick will get it going.  They
worry about a hyperinflation because of all the money being printed to pay for the
programs.  Yet others say the amount is quite within the capacity of the economy
to absorb.  Economists were always a quarrelsome bunch, and I don't envy you
your job, Mr. President.

The issue bothering this observer, Sir, is, why are we paying for worthless
assets?  Take Citigroup for example:  they have revenues of $100 Billion,
expenses of $60 Billion and profits of $40 Billion; all well and good until they take
off $36 Billion as a loan loss reserve for these 20-30 year mortgage assets.  It
doesn't leave very much for lending to get the economy moving, does it?  These
toxic assets have not been marked down to market through a special
dispensation by the FASB (Financial Accounting Standards Board) at the behest
of Congress.  And one source of our problems, Sanford Weill, the former CEO, is
living it up (see Pam Martens' article and the April 11, 2009 Letter here in.)  Would
it not have been simpler to have put the banks under FDIC control and written off
the worthless assets?  At the very least, they would now be lending again.

------------------------------------------------------------------------------------------------------------

This week we saw the introduction of the H.E.L.P. plan.  Any individual looking at
it would also scream HELP!  Amazing that a half century and more after most
advanced countries developed one, we still cannot have a decent single-payer
system.  Of course, their plans are all non-profit based or, in a few cases, closely
regulated.  Are we being told, Mr. President, that our democracy is so inept and
so insensitive to its constituents that it cannot devise an efficient single-payer
plan (preferred by the vast majority) to provide health care for our sick and
injured.

------------------------------------------------------------------------------------------------------------

One cannot fail to notice your envoy is making repeated trips to Israel without
making any headway.  Here is a suggestion, perhaps radical but likely to appeal to
a man of your intellect:

The situation we face is one of settlements so peppered throughout the West
Bank that a two-state solution is infeasible.  Could the answer be a loose union of
states like the EC in Europe?  Israel would remain more or less as is, and the
West Bank would be Palestinian governed with freedom of movement to Israel.
The settlers could stay put just as the Palestinians in Israel. People could also
move freely to where there were jobs, solving Israel's perpetual labor shortage.
Like Europe, people could live in any State but would vote only where they were
citizens. This would preserve Israel's Jewish majority.  Think about it Mr.
President.  Would it not be a magnificent achievement to stop the bloodletting?





June 5, 2009

It was a careful speech, Mr. President: carefully crafted, carefully measured in
tone for careful effect, and carefully apportioning blame and relief to the
different interested nations and actors.  The media billed it as an attempt to reach
out to the Islamic world, and any effort to reach out in friendship must be landed.  
I must add the rhetoric was a welcome change from the abusive bellicosity of the
Bush-Cheney era.

Mr. President, the first time this observer heard of Islam as an adversary was
during (and in the aftermath) of the Israeli invasion of Lebanon.  Menachem
Begin claimed he was helping the Lebanese Christians against Muslims - one can
only speculate if the massacres at the Palestinian refugee camps were a
consequence.  Of course, the objective, as everyone knows, was to expel the
Palestinians from Lebanon, and, ironically, it was supported openly by the Shia
community.  It was only when the Israelis continued to occupy Southern Lebanon
that the Shia turned against them.  The point is that religion is often a mask over
the real reasons for conflict.  Islam has no quarrel with us.  In fact, we are friends
with the three largest Islamic nations: Indonesia, Pakistan, and Bangladesh.

The Middle East is a region of turmoil.  It so happens that a majority of the people
living there follow Islam, but not all.  For example, almost a quarter of
Palestinians are
Christian.  One of the most rigid  Palestinian leaders is George Habash, a
Christian who opted out of 'Arafat's folly' (his definition of the peace agreement)
and in retrospect claims he was right.  The most prominent of Palestinian
advocates in the US, the late Edward Said, was a Christian.  The best known
Palestinian cabinet member Hanan Ashrawi is a Christian.  So is Arafat's widow.  
Mr. President, we deceive ourselves when we frame a territorial conflict in
religious terms - Jew versus Muslim, or even, farcically, Christian plus Jew
versus Muslim --- the latter, of course,  a calculated deception by some in our
own country.

Iran is Shia, al Qaeda fundamentalist Sunni and a mortal enemy.  Iraq was secular
when we invaded; it had a Christian Prime Minister, Tariq Aziz.  The Ba'ath party's
founders included Christians.  There is no monolithic Islamic world offering a
single viewpoint, except perhaps on Jerusalem and the plight of the Palestinians.

In Afghanistan the Kabul government and the Pushtoons all belong to the same
faith.  Circumstances and our policies allowed religious leaders to fill a power
vacuum, and now religion is being used as a recruiting tool against a foreign
occupation.

Perhaps the pill delivered with a thicker coating of sugar is a first step.  In that
case, congratulations Mr. President, you made a fine start.  However, after the
wanton killings of recent years, that part of the world is looking for concrete
changes in policy.



May 29, 2009

Mr. President, you have a host of problems all of a sudden and you have our
sympathy.

The North Koreans have decided to play hard-ball.  Their just-demonstrated
enhanced nuclear capability means your options are limited.  Sanctions, if
severe, will be vetoed by China and Russia.  You can not offend the Chinese lest
they start converting their dollars to euros.  It is only one of the reasons the
largess shown to the banks was ill-advised.  You have also indebted each family
of four to almost the value of a house, and the toxic assets (still on the books at
fake values) merely poison the lending pool sentencing us (like Japan) to a tepid,
sputtering economy for years to come.  I notice Mr, Geithner has been off to
China already.

The North Koreans say they want a bomb and have a bomb.  It is quite different
from the Iranians who do not have a bomb and say they don't want one because
it's against their religion.  This is easier to deal with because we simply need a
mechanism to verify their assertions.  The world would be a happier place if we
had more "jaw, jaw" and less "war, war" to paraphrase a famous leader.

Several people including David Kilcullen, well known to you and General
Petraeus as a counter-insurgency expert, have come out against the continued
use of drones.  The bombing results in untold civilian deaths and they say it is
turning the civilian population against us.  On the Commentary pages, Mr.
President, you can read his article.

You will also notice a link to the distressing video Torturing Democracy
demonstrating a clear link between senior officials and torture --- mostly, by far,
of innocents ---  using new names for age-old techniques all prohibited by Article
3 of the Geneva Convention, and therefore violating our own laws.  I hope you
have given some thought to this because the Convention also gives the right to
any signatory to bring criminal charges against violators.  Spain has already done
so against six senior officials of the Bush administration, and you, Sir, might soon
be facing an extradition request.

To some your nominee for the Supreme Court smacks of a two-fer --- a Hispanic
and a woman.  What surprised us  was the fact she was first nominated to a
judgeship by George Bush Senior, and her nomination held up by a Democratic
Congress.  How times have changed?

Good luck with Af-Pak!  The poor Pakistanis are suffering horrendously as a result
of this war.  Two weeks ago (May 16) this letter introduced you to a grand design for the
region.  I hope you will give it serious thought.  Wishing you the best, Mr, President, as
always.





May 23, 2009

Mr. President, the letter this week poses a moral dilemma.  I feel certain, and I'm
sure your pastor will agree, you will come through with flying colors as they say.

Consider the following:  You are at a garage sale ....

"Just having a house clear-out" says the middle-aged woman greeting you.  "All
the items are marked."

You pick up an old vase, somewhat grimy from disuse --- it's marked $10.  You
also notice the Rookwood Pottery mark and realize it is an antique worth fifty to
hundred times the asking price.

Question 1:  Do you pay the $10 and walk off with what antique dealers call a
'steal'.  Or, do you tell the lady she has a treasure she did not know about.

Question 2:  You decide to tell the lady the vase is worth many times more than
her asking price.  So, you pick up the vase to take it to her only to knock your
hand into someone else behind you.  The vase drops and breaks.  It is now
worthless.  Do you pay the lady $10 or a good estimate of its real value, say $750?

Question 3:  Same as (2) except that through your own clumsiness (entirely your
own fault) you fall, breaking your ankle and the vase.  Before you are carted off to
emergency, swearing under you breath in pain, do you pay the lady $10 or $750
for her broken vase?

The answer to these questions, Mr. President, will inform a person about him or
herself.  Nobody has to tell anyone.  It stays between them and their conscience.

However, the fact remains that most people might discover parallels between
some of the above and many of our domestic and foreign policies.  It might also
explain how and why we are viewed abroad the way we are.  



May 16, 2009

Mr. President, it really does not look like rationality will prevail over vested
interests with either the banks or health care -- no mighty snorting of a bull in our
future, more the off and on sputtering of a two-decade Japanese economy; no
FDR laurels, just a very comfortable retirement of book deals and speaking fees
like your predecessor.

However, there is one area where there is a possibility of a grand design, and
that is the Afghanistan-Pakistan-India problem.  Yes, India is included because it
too has several growing insurgencies.

Not many are aware that the Mughal Empire constituted almost all of present-day
Afghanistan, Pakistan and India. Mr. President, this historical fact germinated the
seed of an idea with the prospect of a worthwhile legacy for yourself.

What is needed in this region is a loose confederation, not unlike the European
Community, of several autonomous regions.  Thus the Pushtoons in Afghanistan
together with their brethren in Pakistan could form a self-governing region free
to run their own affairs but within a Federal constitutional framework.  The same
would be true of the other minority groups in Afghanistan.

Several regions in India and Pakistan, culturally, linguistically, or politically whole
before partition by the British in 1947, could now come together.  Thus,
Bangladesh and West Bengal would constitute a region with a population of a
quarter billion, the fifth largest in the world.  Similarly, the Punjab, and particularly
Kashmir, where a several decades old insurgency with over a hundred thousand
estimated deaths would come to an end.  Finessing the Kashmir problem would
end the resentment and anger of the Muslim population of the subcontinent and
reduce substantially the fuel lighting the jehadi movements in Pakistan and India.

India gains in many other ways also.  First, a huge market will have been formed
for its growing industries.  Second, an end to several insurgencies, given those
peoples would now be autonomous with a voice in the Federal capital.  Third, a
federation constituting the largest country and democracy in the world.

Pakistan would see an end to the chaos gripping it and threatening its
destruction.  The Pushtoon insurgency would cease and the crippling defense
costs of a huge standing army, air force and navy would become unnecessary.  
Regarding defense expenditures, the same would apply to India though to a
lesser extent.

All in all, a tall mountain to climb, Mr. President, but then legacies are not formed
conquering molehills.




May 9, 2009

Mr. President, this Letter dated March 27, 2009 detailed the story of one victim,
called Uma in the article, a tailor's wife out to deliver her husband's work,
returning home to find nothing - no husband, no children, no house, just a hole in
the ground.

This week there are reports of over a hundred civilian deaths in western
Afghanistan from another air raid.  Meanwhile, the drones continue their work in
the border regions.  Who in your mind is ultimately responsible for this shedding
of innocent blood?  Forgive the question, Mr. President.  It is only intended as a
reminder of legacy.

Your predecessor engaged in a war against a country (Iraq) innocent of the
accusations leveled against it.  Contrary to their suggestive implications, Iraq had
no hand in 9/11.  Nevertheless, the Bush-Cheney 'war on terror' resulted in over
1.2 million Iraqi deaths and 10 million displaced persons (according to the latest
analysis by MIT professors using the best estimating methods).  If the horror of
Uma's story is heart-rendering, can one imagine multiplying it over a million times
and leaving that as one's legacy.  Quite frankly, Mr. President, few ordinary
mortals would want to be President.

The Pushtoons also had no hand in 9/11.  Their beef is with the Northern Alliance
Government, and with us only because we installed and support the regime.  
Quite naturally, the Pushtoons resent this minority government of Tajiks and
Uzbeks imposed upon them externally.  Religion and the Taliban have become
merely the instrument of Pushtoon nationalism.  Our policies have served only to
exacerbate the schisms between the Pushtoons and the governments of
Afghanistan and Pakistan with disastrous results, first for the former and now, as
we see in the faces of fleeing refugees, for the latter.

In the brief hundred days of your term, Mr. President, the number of refugees in
Pakistan are fast approaching a million, mostly because of the new policy of
escalation.  This is supposed to be a war for the hearts and minds of these
people.  Forgive me for asking Mr. President, but if put in their place, what would
be in your heart and mind regarding this policy?

Suffice it to say, your directives have already had the effect of displacing as many
as a tenth of all the displaced in Iraq during the whole Bush term.  Mr. President, I
would be lying if I did not say, your supporters are gravely disappointed.

On the torture question, your ambivalence is also a surprise.  If it's torture, we
have statuary laws against it, and it's a criminal offense.  Your Constitutional oath,
Mr. President, is to enforce the laws of this land.

A short while ago criminal proceedings against Bush Administration officials were
initiated in the Spanish courtroom of Judge Baltasar Garzon.  As a lawyer, you
perhaps remember him for bringing the famous case against Pinochet.  Gonzalo
Boye, a Chilean-Spanish lawyer and a specialist in human rights law has filed a
lawsuit citing the torture of five alumni from Guantanamo.  The criminal complaint
names Douglas Feith, the former Undersecretary of Defense and others.  It
certainly merits preparation for the decision awaiting you if arrest warrants are
issued for these officials, and the prima facie evidence seems to point in that
direction.  Rather ironic then that Mr. Bush's famous phrase, "he can run but he
can't hide" has had a boomerang effect.

A final thought, Mr. President, with respect to Af-Pak as you folks are now calling
it, please remember the "golden rule" as you deal with Pushtoons or let me be
the first to predict your poll ratings in the thirty to forty percentile by the next
election.




May 2nd, 2009

Mr. President, it looks to us like the bankers have won.  Trillions now, and more
trillions to come.  By some estimates, the total of deficits is likely to exceed $9
trillion.  More worrisome, these estimates always turn out to be far less than
actual --  remember the Iraq war estimates of $60 billion vs. the rapidly
approaching trillion mark.

Forgive the presumption, Mr. President, but it is time for an arithmetic lesson.  
The population clock records us as just over 300 million.  It means your advisers,
Mr. President, in the first hundred days have set us on a course of indebtedness
that puts each man, woman and child in hock for $30,000.  Given the proclivity for
underestimating deficits, the debt incurred might well require a family of four to
pay back through taxes and inflation the cost of a median family house.  What an
enormous transfer of wealth to rich bankers, and other such stakeholders, from
the poor hard-working lower and middle classes.

In your favor Mr. President is your confident, pleasant, soft-spoken, gravitas
exuding manner persuading the people of your ability to solve their problems.  
Fortunately for both your party and the Republicans, few in our country have had
the benefit of a decent education, and few really understand what's going on:
over fifty percent believe the earth was created, as is, 10,000 years ago; very few
can understand credit card agreements, mortgage documents or any of the
financial complexities of our modern existence; almost a quarter are functionally
illiterate.

Gone is the industrial base providing well-paying jobs for the school-leavers, and
with it have gone the taxes funding their schools.  Any wonder, the drug
business thrives.  For this disadvantaged class (all other avenues being closed),
it often becomes the only rational way to make a living.

There is a strong case for legalizing drugs, Mr. President.  The dealers are
providing a service our society appears to demand.  Much like alcohol, harm is
self-caused by addicts, and the increased murder and mayhem a direct result of
the illegality.  Would it not be better to employ the millions wasted on this losing
"war on drugs" towards rehabilitation and job training programs to give people
alternative choices?

Finally, on the torture issue and the looming debt, do be careful Mr. President.  If
you keep looking forward, you might be totally unaware of the tsunami behind.




April 25, 2009

In a recent short story in "The New Yorker" (The Elephant by Aravind Adiga) the
protagonist is a cycle cart driver in South India.  He tries to better himself by
helping in a political campaign promising a better future.  He works
extraordinarily hard and manages to corral the minority vote which secures
victory for his candidate.  Expecting some kind of reward, he goes to the party
office.  He is kept waiting, and waiting and waiting.  Finally, he is offered a boiled
sweet.  When he protests in exasperation, he gets slapped and thrown out.

Mr. President, you enjoy popular support.  Please, do remember, however, that
the Republicans are going to peel off come election time and the Democrats are
beginning to get dissatisfied.  It started with the left wing but as the mainstream
discovers your policies are no different from George W. Bush on the major
issues -- would have been difficult to imagine a few months ago -- you will be in
for a fight.

Lewis Lapham in his inimitable style, weaving a silk tapestry with his words, wrote
in the March Harpers of a seamless transition between administrations where the
best and the brightest "learn to work the system, not to change it."

But the system has failed us and the time for change is upon us.  Lapham reminds
us that "FDR composed a 'Brain Trust' of individuals (some of them academics,
others not, none rounded up from the quorum of usual suspects)" ready for new
approaches.

Mr. President, I do not mean to cast doubt on your sincerity, just on the
possibility of any substantial accomplishment if you rely on Mr. Lapham's "quorum
of usual suspects."  Perhaps you also need help in the form of the Pecora
hearings of the 1930s and your party's leaders in Congress can be made to oblige.

________________________________________________________________________

Torture is in the news again.  We appreciate the openness of your
administration.  But if water boarding is torture -- and we prosecuted the
Japanese as war criminals post WWII for employing it -- then surely it is
inconsistent to ignore our own culpability.  At the very least, the lawyers who
promulgated these extraordinary legal determinations should have their legal
judgment and capacity questioned in a court of law.

Finally, Mr. President, I hope you are having fun with your dog.



April 18, 2009

The new HDI (Human Development Index) report shows us down again, now from
12th to 15th.  The HDI is a normalized compendium of life expectancy, literacy,
educational attainment and GDP per capita.  Iceland, Norway and Canada lead the
list.  Much denigrated Cuba keeps climbing!

Why is our neighbor to the north so far ahead?  One word, Mr. President, health
care.  They have a superb single-payer system we could learn much from, and be
lucky if we adopt it.

You, Sir, want to expand the current system -- but covering more people is a poor
partial answer.  Most personal bankruptcies are due to medical bills when people
actually have insurance.  Why?  Because of policy restrictions (the fine print) and
co-payments, and because the companies cut them off at renewal time when they
are seriously ill.  Then, facing a choice between health insurance and eating, they
choose the latter.

The public hospitals like Chicago's Cook County -- in your old haunts, Mr.
President --  are so underfunded and overwhelmed, they do not have the
resources to administer anything more than an initial treatment.  What happens to
these people?  Impoverishment of families, bankruptcy, Medicaid and death from
inadequate care, in endless variations.  Is this a morally justifiable way of treating
the weak and vulnerable in a rich developed country is a question we should ask
ourselves?  By the way, Mr. President, congratulations on acquiring your new
dog.  I assume he, like most pets, will have better health care than many millions
of humans in our country.

The economy remains the elephant in the room, Mr. President.  Left-leaning
economists and conservative economists, including eminent Nobel Prize
Laureates, all oppose the approach being used by your administration.  Mr.
Geithner and Mr. Summers are handicapped by their long association with banks
and the latter is tainted with accepting speaking and consulting fees from the
entities receiving assistance.

Is it time to reconsider?  The remedies being advocated are too close to the
Japanese solution of twenty years ago, which has left Japan in the doldrums ever
since. We have to ask if it is fair to risk sentencing an entire generation to
misery.  No bank is really too big to fail; it's the old threat used to get public
money.  The trouble is, if we give them the money, we give them further incentive
to take risks they should not.  Why? Because we make profits private, and losses
public.  It's nothing new; everyone knows about it as it's happened before.  The
FDIC, of course, has a tool called a 'bridge bank' to deal with the big ones like Citi
and BofA, the two in worst shape.  Let's start with these and see how the others
fare.  Otherwise, unfortunately, the pall cast by them will continue to prevent the
clean banks from helping the economy.

Mr. President, toxic assets have to be eliminated -- purged to clean out the
system.  Think of it, Sir, as a radiator flush before fresh coolant!  Why should we
poor folk pay for the banks' worthless assets, anyway?  Why can't that money be
used to get the economy rolling again instead of supporting a rotten banking
structure?  That's what all the Nobel Prize winners and the rest of us want to know.  
When will you start standing up for us, Mr. President?



April 11, 2009

The CEO of GM has been forced to resign.  Mr.President, you forgot one thing ---
GM actually produces something in this increasingly empty shell of a country of
ours, and under Rick Wagoner they had finally brought out cars like the Malibu
and the Cadillac CTV that were competitive with the Germans and the Japanese.  
And, GM is not the cause of the disaster, it is a victim like the rest of us.  It begs a
simple question, Mr. President, "How is it that the CEOs of the banks that brought
this disaster upon us, and who are receiving an order of magnitude more in
bailout money than GM, are still with us and how did they do this to us?"

The bankers wanted to cut loose the shackles limiting risk-taking.  After much
lobbying, the Glass-Steagall Act of 1933 limiting bankers' freedom to gamble, and
the fruit of experience from the depression, was repealed.  Why did they want
more freedom?  Because very, very simply, they were very, very greedy.  Here
are the actors and the scenario:

  • Sanford Weill, former CEO of Citigroup, takes over Citibank and forces out
    the traditional bankers.

  • Herb Greenberg at AIG prepared and ready to insure the derivatives.

  • Treasury Secretary Rubin, formerly from Goldman-Sachs and his protege
    Larry Summers soon to follow him as Treasury Secretary, when he moved to
    Citigroup to head the investment committee.

  • Former Senator Phil Gramm of Texas and his wife, the former head of the
    Commodities Futures Trading Commission and his cohorts, and    

  • The constant drumbeat of deregulation since the Reagan years as a
    panacea for all our ills.

Forget the crippling infrastructure, forget the decaying industrial base, forget the
crippling health care costs that have hamstrung our companies; instead enter
the twilight zone of the industrial scale manufacture of money, simply by labeling
pieces of paper differently.  Enter regulator Brooksley Born, a true heroine of
this saga.  She tried to regulate the CDFs .  Summers, Rubin, Phil Gramm and
friends came and said "We will block this."

How did they do it?  The Commodities Modernization (read deregulation) Act of
December 2000, signed into law by Bill Clinton, specifically excluded the Credit
Default Swaps from regulation.  Yes, there were subprime mortgages, slicing and
dicing and repackaging of mortgage paper like a Caesar salad, ethically
challenged rating agencies, greedy investment bankers' hunger for more and
more paper because it was so profitable; yes, they were all there but it could not
have gone on so long without the illusory insurance provided by the CDFs.

Mr. President, why are the people who have caused so much misery, and brought
us economic disaster while profiting handsomely themselves, still being
rewarded?  Why have you not appointed someone neutral and honest to
investigate this mess and report to us?


April 4, 2009

Dear Mr. President:

The economic world does not revolve around a (former Treasury Secretary)
Rubin axis.  So far, your economic team, tied closely to him, is trying to replicate
the response to the Mexican crisis during his tenure.  But propping up the banks
this time around, as you have found, is a several trillion dollar venture not the
relative chicken feed of the Mexican disaster.  And, it's certainly not over.

Mr. President, you have the mandate, the support of the people, and even the
poll ratings to defy orthodoxy.  The people sent you up there to challenge the
bankers, who had ruined their lives, not cozy up to them.  Everyone - no
exceptions - among the ordinary people is disgusted with the bankers.

You have very little time before this economic disaster begins to have an Obama
imprint.  By then, your poll numbers will be dropping and so will your leverage.

Even though your policies are costing several times more money (that could
have gone towards health care) than necessary, let us at least get a decent set of
rules, so this calamity does not befall us again.  Rolling back the deregulation
regime and listening to the Europeans on developing strong international
regulations could be a first step -- not increasing the unelected and uncontrolled
Fed's power.

So far, Mr. President, you have Mr. Geithner, who as head of the New York Fed
helped fashion the Bush Administration's approach to the financial crisis, and Mr.
Gates who ran the Defense Department for President Bush.  Did we hear 'change
you can believe in' or are we living in a twilight zone where the US becomes a
one-party state like the former Soviet Union?

Mr. President, this is your FDR moment.  Don't let it slip by; seize it to work for the
people who sent you up there.



March 27, 2009

NOT JUST A RESPONSE BUT A  JUST RESPONSE

Let us call her Uma.  Her husband was a tailor and she often made deliveries for
him.  Returning from such an errand to a neighboring village, here is what she
found.  Her house including all her possessions, carefully accumulated in the
hard scrabble of a war-torn country, had disappeared into a large deep crater.
Buried under all this rubble were all her children and her husband, who she had
left working on his sewing machine --- all obliterated.  This was the beginning of
the "War on Terror" - the attack on Afghanistan commencing with a bombing
campaign.  Ask Uma what the twin towers are and you will get a blank stare.  The
technical wizardry employed in this violent injustice is astounding.  Target
selection by experts in the United States using sophisticated computers and
satellites, airplanes from aircraft carriers meeting up with tanker airplanes flying
in from land bases for mid-air refueling, and smart bombs so accurate they home
in on their target day or night through clouds or smoke.

Ask Uma why all she has left is a large hole in the ground and the mindless
wandering of a casualty of modern warfare, and she will say, "It was God's will."  
That was over a half-dozen years ago.  Ask the relatives and survivors of the
forty-seven civilians killed when a wedding party was bombed, and they will say
the Americans easily surpass the Soviets in brutality.  This time the local
response was to attack an American outpost killing nine of our brave men and
wounding dozens - none having had anything to do directly with the bombing of
the wedding party.  The outpost has been abandoned.  The mindless tit-for-tat
continues.

The questions to ask are, Did any Afghan take part in the 9/11 attack?  Did any
Afghan plan the attack?  Did any Afghan finance the attack?  The answer to all
these question is the same resounding, "No!"

The actual 9/11 attackers were Saudi Arabians led by an Egyptian.  The
operational planner, a Pakistan national, was arrested by the Pakistan police and
handed to the U.S.

The organization responsible, al Qaeda, headed by a Saudi and an Egyptian was
based in Afghanistan.  As is common knowledge, they are a group of
fundamentalists with political not religious goals. Originally supported by us, they
helped to repel the Soviet invasion of Afghanistan and were unceremoniously
dumped (as were the Afghans) after the Soviets left.  The Afghans' gratitude was
more permanent, and, true to their famed code of hospitality, made these Arabs
welcome in Afghanistan.  Also true, and for the same reason, they did not
surrender bin Laden and his cohorts.

Could the smart answer have been careful negotiation, diplomatic and military
pressure through Pakistan accompanied with financial incentives for both
countries, and, not just satellite surveillance but on the ground intelligence
collection?  Perhaps in the end, a small special forces operation against al-Qaeda
would have been necessary but it would have had the benefit of superior
intelligence and probably Pakistan's help because they had 'no dog in the fight'
as far as al-Qaeda was concerned.  It would almost surely have left Uma's family
intact, and might even have spared Pakistan its present misery.

Mr. President, before you dig yourself deeper into the hole that is Afghanistan,
and before Pakistan suffers the fate of Cambodia, please remember:  if you go to
a specialist with an ailment, he or she is likely to provide a remedy from his
specialty.  Unfortunately, your predecessor went to a gynecologist for a couple of
ulcers and gave birth to a pair of monsters.  Of the two, the outcome in Iraq is so
very uncertain, and Afghanistan is a headache that we hope doesn't turn out to
be brain cancer.  The history of attempted military solutions in Afghanistan is not
encouraging and perhaps a review by your staff of past British campaigns there
is called for.  Everyone who has invaded there, including the Soviets, thought
they knew better, so it would be instructive to understand the Afghan/ Pathan
character.  

We wish you well in your endeavors on our behalf.
______________________________________________________________________

The other news this week, Mr. President came from your Treasury Secretary.  He
wants to spend another trillion on helping speculators buy up toxic assets.   In
this plan, their losses are covered by us and we allow them a highly leveraged
investment (20 cents on the dollar) with the potential for enormous profit.  
Forgive me, Mr. President, but it seems the four major banks, the investment
banking houses, the hedge funds, etc. have got your Administration and
Congress in a bear hug, shaking out every penny the ordinary Joe has or will
save.  These trillions are going to cost us plenty because no one can print money
like this without economic growth and not have a horrendous inflation.  There is
one other possibility - a stock market collapse down to the value of real future
income.  As this is not the most efficient or cheapest way to deal with the problem
(please refer to several earlier letters on FDIC takeover and the Swedish model),
I have two questions:

1.  Why are you putting scaffolding on a crumbling banking structure that caused
our problems?

2.  Why do you employ people who set up the rules that let this happen?

There are a host of other questions to ask about banks and I refer you to the link
below for the Nieman Watchdog

http://www.niemanwatchdog.org/index.cfm?fuseaction=ask_this.
view&askthisid=00402




March 23, 2009

P.S.   The plan unveiled today providing strong incentives for private investors
to purchase the banks' toxic assets and dubbed by this year's Nobel Prize winner
in economics, Paul Krugman,  as "cash for trash" does, firstly, very little to
stimulate lending, and, secondly, lands the tax-payer another huge bill.  Why?  
Here is a simple analysis, Mr. President.

Who owns the toxic assets?  The banks.  Who owns the banks?  The
shareholders.  Why should we help the shareholders and least of all the bankers,
who have brought us this catastrophe?

Our financial structure is based on capitalism.  The banks, shareholders, and
executives took their risks for profit but lost.  The banks are now bankrupt.  Why
can't the FDIC intervene as it does when banks fail.  The depositors will be
protected, the shareholders gone, the toxic assets marked down, though these
will probably gain in value as the economy recovers.  More importantly, the huge
amounts of proposed bailout money can be used to begin lending to stimulate
the economy.

What is wrong with this plan?  Only that the bankers and shareholders do not like
it because they lose, and they seem to carry considerable clout in both the
Congress, and, sad to say, your Administration.  The question is, "Whose side are
you on, Mr. President?  Are you with the people or the bankers?"



March 21, 2009


Dear Mr. President:

Here are two quotes:

President Bush after the New Orleans disaster, "Brownie, you are doing a heck of
a job."

You Sir, Mr. President, on the economic disaster, "Treasury Secretary Geithner is
doing an outstanding job."

Mr. President, here are some facts:

The unions and the corporations (like GM) actually producing something tangible
are given a relatively paltry $50 billion or so with strong admonitions particularly
to the unions to make sacrifices -- read cut pensions, health care, pay, etc.

Meanwhile the bankrupt banks, and their lead insurer AIG, larded up with over a
trillion have awarded bonuses to those executives, who invented and used the
toxic derivatives, plus other incompetents so drowned in their Hamptons' luxury
that reality had passed them by.  Of course, these bonuses have been renamed
'retention payments' as if these pampered 'geniuses' are flying out the door to
waiting jobs.  Mr. President, exactly who is rushing to hire them?

Now, it has been discovered, that the 'outstanding' Treasury Department knew
about these bonuses all along.  Of course, you have stated, you did not.  And, Mr.
President, I do not doubt your veracity.  But here is something you do know, and
if not, this letter will tell you.

The following is a brief summary of the crisis drama:

Mortgages assumed by homeowners, and previously retained by local banks,
were now packaged and sold to Wall Street -- thanks to deregulation.
The locals no longer worried too much about risk because the mortgages were
soon off their hands.  Meanwhile, Wall Street's hunger for mortgages multiplied
and the quality of borrowers declined as numbers dried up.

Enter the rating agencies like S&P:  There were persuaded by the vendors that
poor quality subprime mortgages when sliced thinly enough and packaged
together deserved a higher rating because of diversification.  It did not take a lot
of convincing because it was also a highly profitable arrangement for the rating
agencies.

Enter the insurers (AIG):  They introduced Credit Default Swaps (unregulated)
which offered banks insurance protection for their mortgage paper.  
Unfortunately, hedge funds began to use the swaps as market proxies and as a
result, trillions of these are floating about.

Enter the government officials:  Your bailiwick, Mr. President.  Starting with the
Reagan administration, there has been a constant and persistent gutting of the
rules designed to curb rampant speculation and keep banks from getting
themselves into trouble.  The final straw, perhaps, was the Commodities
Deregulation Act of December 2000, which excluded Credit Default Swaps from
regulation.

The actors:
Former Secretary Rubin, a strong deregulator, your informal adviser, with
numerous acolytes; he moved to the investment arm of Citigroup, and was
recently relieved of that post.

Mr. Summers, acolyte #1, successor to Mr. Rubin and now your economic adviser,
was an ardent supporter of the December 2000 Commodities Act.

Treasury Secretary Geithner and his four advisers from Citigroup fall in the same
category.

Alan Greenspan -- who acknowledged his heretofore erroneous faith in markets
regulating themselves and called for a takeover of the banks.  Much cheaper for
the taxpayers and consequently a disaster for the executives and shareholders
of Citigroup and the other banks.  No bonuses, for sure.

Phil Gramm, the notorious backer (with his wife, a former chairperson of the
Commodities Futures Trading Commission) of the December 2000 Commodities
Act.  He was economic adviser to your opponent in the Presidential election, but
disappeared into the wilds of Texas after the financial tsunami hit.

President Bill Clinton signed the December 2000 Act into law.  He also famously
pardoned Mark Rich, the crooked commodities dealer who fled the U.S.  Mr.
Clinton earned over a $100 million giving speeches and dispensing advice after
leaving office.

Secretary of State Clinton, who parlayed $1,000 into $100,000 in one year's astute
commodities trading and then decided to shelve this remarkable skill (in an arena  where
ninety percent of novice traders lose all their money) to return to the impecunious life as
the wife of an Arkansas government official earning in the order of $30,000 per year.

Mr. President, if someone were to come and rob another's house, you would say, "Let the
law take its course."  But what of people responsible for taking away, not just the contents,
but the house itself, and not just one house, but thousands upon thousands, and
destroying not just one life, but millions.  What should be done to these people?

Some of them even work for you, Mr. President, when there is no shortage of very smart,
honest and capable people in this beloved country of ours.

Needless to say, you are well aware of Congressional elections nineteen months away and
your next election two years thereafter.  You may not have known about the bonuses but
you do know about these people.

Let us all hope your policies, while costing four times more than necessary, work out for all
our sakes.  The cost in sacrifice and future inflation will have to be borne by the poor and
powerless, but that's just one of the hazards of living in a democracy.



March 13, 2009

In an interview with Charlie Rose this week Treasury Secretary Geithner was
asked why they hadn't seen this financial tsunami coming.  Well, he says in his
inimitable style, head cocked, forehead crinkled, eyes looking up showing the
whites under the pupils,"...the regulatory system was designed ninety years
ago... not up to the task etc."

Ordinary Americans are reasonable people Mr. President, remember they elected
you.  But not to hear fabrications -- it gets the dander up.

Most people are aware that since the Reagan administration, the rules set up in
the thirties have been steadily and progressively eroded culminating in the
December 2000 Commodities deregulation fiasco signed by President Clinton.  
This pet child of former Senator Phil Gramm (erstwhile economic advisor to
candidate McCain) who melted away into the wide plains of Texas never to be
heard from again after our tsunami hit, was strongly supported by Mr. Rubin, his
protege, Larry Summers then Treasury Secretary and Mr. Geithner.

Mr. Rubin headed Goldman Sachs before he was Treasury Secretary and went to
Citigroup after.  Mr. Geithner has four helpers from Citigroup including a former
lobbyist.  His predecessor Mr. Paulson came from Goldman Sachs and his
package to the banks he claimed received paper at par.  Law Professor Elizabeth
Warren from your alma mater, Mr. President, leading the Congressional Oversight
Panel reports that in actual fact we received half of par on the dollar in terms of
paper from Citigroup while other private investors, sovereign wealth funds from
Abu Dhabi, etc. were getting $1.00 to $1.25.  In effect Citigroup obtained a
subsidy, a gift, from the taxpayer of fifty to seventy-five cents for every dollar of
paper amounting to tens of billions of dollars.  When is the regime of private
profits and public losses going to end?

Why can't Citigroup, a failed bank, be treated like other failed banks?  Alan
Greenspan is now in favor of an FDIC intervention as are many distinguished
economists.  Without the specter of bad loans or the conflicting interests of
shareholders, the banks could start lending again.  The longer we wait, the worse
will be the problem.  Mr. Geithner is much too sensitive to bankers interests, to
represent the people that elected you, and it is time for him to find other
pastures.

Ahead of the G-20 Finance Ministers Conference the Europeans are calling for
firmer international regulation to prevent another collapse like the one we are
undergoing.  What's wrong with that?  But bankers (obviously) and Mr. Geithner
(naturally) are opposed to this.  Need one say more.

P.S. Some of the banks are now claiming they are operating profitably if we ignore
the bad loans.  It's as if a mortgage holder who can no longer make his mortgage
payments says to the government, 'Look I'm living within my means except for the
mortgage.  Just pay it off would you.'


March 6, 2009

There are four major banks: everyone knows them.  A owes to B which owes to C
owing to D and back to A.  If we prop up each of these banks supporting each of
the interbank loans, it will cost us four times as much.  The banks are insolvent.  
Let's face up to it and use the process already available for dealing with
defaulting banks.  The FDIC moves in and takes over.  We the taxpayers would be
far better served than trying to shore up each bank.  So far we have given
money, bought preferred stock and now have progressed to acquiring almost
worthless common stock.  

The bankers are powerful.  They have paid well for the elections of the members
of the Senate banking committee as well as the House body.  They have even
paid well in the Presidential election.  The question is can anyone face down the
bankers on behalf of the taxpayers.

The same problem with healthcare.  The people by an overwhelming majority
support a single-payer system, like Canada has for example.  In Canada a large
hospital might have one person responsible for billing the state.  Around here
there will be at least a dozen or more.  Administrative savings, it has been
estimated, will cover insuring the uninsured.  Despite all this your recent
healthcare summit excluded single payer proponents until overwhelming
protests forced you to reconsider.  So again, who is going to face down the
insurance companies on behalf of the people.

Mr. President, you made a moving speech talking about the bankruptcies
healthcare bilils are causing in our country.  But, Sir, most of the bankruptcies
happen to people who are already insured because of the 80%/ 20% requirement
leaving insured responsible for 20% plus the non-renewal of policies when a
person becomes seriously ill.  Insuring the uninsured does not solve this
problem.

A recent visit to the doctor for a viral infection that moved to the lungs cost
$645.  Not in one simple bill, no way!  The bills started arriving: from the doctor,
the blood lab, the Radiology department for the X-ray, the radiologist for reading
the X-ray, copies of bills to the insurance company, copies from the insurance
company, reminders that money was owed even though the insurance company
had not responded, bill outlines for each of the bills from the insurance company
stating new amounts for the charges (apparently insurance companies pay about
40% less for the same services) and how much the insurance company would
cover.  Then new bills from the doctors and other providers stating the new
charges and how much the insurance company had paid.  Even worse after the
bills had been paid, more bills as reminders because the computers had not
recorded the payments, the latter discovery after a tedious  interminable -- "all
our representatives are busy" -- phone call.  Is this any way to run a railroad?  
And how does it get better if you perpetuate this system?  In the UK you never
get a single bill.  And, please, do not listen to lies about the service provided
under single-payer systems.  It is the most popular government-run service
supported by all political parties.




February 27th, 2009

Mr. President, I regret very much having to say this but your policies, most
unfortunately, have begun to have the stale taste of reheated weekend leftovers
on a Monday night in a Chinese restaurant.

Employing bankers' representatives will not lead to the painful treatment
necessary for bankers and their stockholders. Your policies are reminiscent of
Japan with problems fueled likewise by property speculation where the stock
market has traded between one-third and half its highs for twenty years and the
country has been in the doldrums. It will also diminish your importance in history
when you could very well be a Roosevelt – at least I hope so. The case of
Sweden, some years earlier, offers a model of a successful intervention. It will be
better for the rest of the market and even for the banks in the end, and best of all
we know it works. The weakness of the stimulus package in its immediate impact,
and the dithering and incoherence from the Treasury Secretary have received
their grades in the stock market already.

Throwing money at banks is unlikely to work because while toxic assets and $62
trillion of credit default swaps are floating around, bankers will keep shoring up
their balance sheets. The problems caused by the swaps are a direct result of the
Commodities Deregulation Act of December 2000, and, unfortunately, you have
appointed an ardent advocate, Larry Summers, as a major advisor. I can think of
several Nobel Prize winning economists and other major thinkers who can serve
you better.

By the way, how could anyone (except under Summers' advice, I suppose) have
picked Gensler, a notorious deregulator, to head the CFTC. To bring back into
government the self-same promoters, who advocated policies leading to the
worst financial mess since the Great Depression is difficult to comprehend,
especially given the pain and suffering in the disadvantaged communities that
elected you, Mr. President.

You have so many voices for the bankers on your team; forgive me for asking but
who represents the common person whose pension funds are being eviscerated
and will continue to unless the banking cancer is cut out.


February 19, 2009

I write less in anger, more in dismay at the seeds of a failed Presidency already
being sown by your Administration.

You were probably too young to remember the Savings and Loan crisis – caused
by deregulation. It was not solved by throwing money at the S & Ls. The current
problem has the same root cause and it makes very little sense that some of the
strongest advocates of deregulation have senior positions in your government
and strong voices in the proposed solutions. Former senator Phil Gramm of
Texas, his wife who headed the CFTC, Larry Summers etc. helped pass the
Commodities Deregulation Act in Dec 2000. So what is Larry Summers plus
banking lobbyists and several senior bank officers of these troubled banks doing
in your government when we were promised no lobbyists? Their solution seems
to be loading the common man (and his offspring given the size of the problem)
with taxes to pay for the banks' profligacy. So far it has not worked.

There is an obvious solution for the banks. The template has been furnished by
the Swedish banking crisis and it does work. When a small bank fails, the process
of intervention used by the FDIC works perfectly well, and with appropriate
financial backing can work also for these mammoths. The toxic assets would be
marked down to their real value; government backing would ensure lending
resumes – unlike the present when any money given to the banks is used to
shore up reserves against toxic assets. Of course the strutting bank chiefs
would have to go as well as the fake $500K cap (as many holes as Swiss cheese)
on their salaries.

Sad to say, but in my circle just about everyone is reevaluating their 2008 vote if
only to punish people who do not do what they promise. All the same, I wish you
the very best in your endeavors and hope that you will pay some tangible (not
rhetorical) attention to the hard-working people in addition to the banks.

ofthisandthat

Weekly Letter to President Obama
Custom Search
Copyright © 2009 ofthisandthat.org.
 All rights reserved.
Questions and Comments
backfire@ofthisandthat.org
INAUGURATION,   January 20, 2009

My world, this cage...
Drunk in its stale air
For two hundred years.
Fettered in mind and body,
The soul, the safe escape

To let me breathe the cries
Of my heart singing
Tears of mel-an-choly.

The tears flow free today
Washing the stains of blood
And sweat in brotherhood.

Raise the curtain then an'
Let the world look in
On this promised land --
We breathe free today.... almost.

--- Arshad M. Khan
Note: Letters updated
every Saturday.
Please scroll down for
earlier letters.
We will be known forever by the tracks we leave.
---  Native American proverb