Bill Clinton on the Mess in America Today

Bill Clinton has written a new book, out this week, “Back to Work: Why We Need Smart Government for a Strong Economy.”

In the book, former President Clinton blames both the Republican Party and President Obama for creating dysfunctional politics. He said he wrote the book because he loves his country and is “…concerned about our future.” In a phrase that is sure to become a classic during the 2012 presidential campaign, he added, “We’ve got to get America back in the future business.”
The former president criticizes President Obama’s handling of the debt limit and his promotion of nuclear energy.
But, as one might expect, Clinton saves the worst criticism for what he calls the “antigovernment” movement, including the tea party. He says these groups want to reduce the role of government, cut spending and taxes, and scale back regulations in order to stimulate the economy and cut the deficit.
Bill Clinton takes pride in his record in office because in the 1990s he presided over a federal government that actually left a surplus to his predecessor, the first President since Eisenhower in the 1950s to do that. More than 22 Million new jobs and continuous economic expansion were the hallmarks of his success.

Many will add that his partner in this economic success was Newt Gingrich, who was Speaker of the House during Clinton’s term in office, and who worked with the President and a Republican Congress to bring about the economic ‘miracle.’

In the book, President Clinton argues that a public-private / GOP-Democrat partnership is needed to overcome “the mess” America is in.

“I believe the only way we can keep the American Dream alive for all Americans and continue to be the world’s leading force for freedom and prosperity, peace and security, is to have both a strong, effective private sector and a strong, effective government that work together to promote an economy of good jobs, rising incomes, increasing exports, and greater energy independence.” And, he adds, there is much room for real debate between the parties on the major issues of the day, with the opportunity for them to structure bi-partisan solutions.
Clinton criticizes Obama and the Democrats for failing to raise the debt ceiling in November - December 2010, when they still controlled both houses of Congress. He says that this led to a partisan battle over the budget that made the United States look “weak and confused” to the world. He says it also caused Standard & Poor’s downgrading of America’s long-term credit rating, noting S&P's comment that American politics “have become dysfunctional.”
Clinton admits that his campaigning on behalf of Democrats in the 2010 midterm elections was less than helpful because of the Democrats’ failure create a national message to counter the antigovernment wave that swept many Republicans into office. And, the former President rejects the message that the 2010 election delivered - calls for spending cuts and tax increases. “Even though I strongly favor a multiyear plan to bring our budget back into balance, if we cut spending or raise taxes a lot when the economy is still weak, it will slow down economic recovery.”  
In his book, Clinton gives 46 specific proposals “to increase bank lending and corporate investment, to create more jobs that pay well, and to make sure we have enough people trained to fill them.” He calls for an end the “mortgage mess,” lower corporate tax rates and reduce credits and deductions, building a 21st-century infrastructure, encouraging the creation of new green-technology jobs, and providing disincentives to laying off workers.
Clinton’s overall message, as the title of his book states, is the need to put Americans back to work. “It’s heartbreaking,” he writes, “to see so many people trapped in a web of enforced idleness, deep debt, and gnawing self-doubt. We have to change that. And we can.”

It is well to remember that since Clinton left office, he has remained a powerful voice within the Democrat Party, while at the same time becoming popular with Republicans, including many who were his former critics. A recent poll found that Clinton’s favorability rating was 67%, his highest rating since leaving office, with his favorability among Republicans 40%.

Clinton’s message is particularly on point today, when we saw the spectacle of the GOP congressional members of the Super Committee, charged to cut $1.2 Trillion from the federal budget, presenting for the first time a proposal which would actually include a $300 Billion tax increase.

The Democrats on the Committee have been calling for its GOP members to realize that their effort must include tax increases as well as spending cuts. So, what was the Democrat response to the GOP offer?

Democratic Senator Kerry, also a Super Committee member, said the offer represented “a change” in the Republican position, but added, “I would not characterize it as a substantial change yet.”

Other Democrats said the offer represented no change at all because the tax revenue offer was tied to lowering overall tax rates. Another Democrat is reported by the Washington Post as saying, “They either think we’re morons or desperate.”

Instead of backhanding the GOP proposal, the Democrats should, if they want to follow President Clinton’s advice, take the GOP offer and try to fashion it into a proposal the two parties can agree to. With only 2 weeks left until their report is due, one might think they would have tried to compromise. But, as Clinton said, America is in “a mess.”   

Good-bye, Michael, We Loved You Even if We Couldn't Help You

Dr. Murray is guilty. The Michael Jackson trial, and probably a big part of the media frenzy over what killed him and why, is over.

During the course of the trial, we had confirmed in spades that Michael was addicted to at least some drugs, if not the ones we usually associate with drug addiction. We learned that he had paid staff to protect him 24-24, and that he was willing to pay a doctor $150,000 per month to watch over his medical needs, including those related to his addiction to dangerous sleeping drugs.

But, we also learned a lot more, if we were paying attention.

We learned that Michael Jackson would not have died, at least not at the hands of Dr. Murray, if anyone had cared enough about him to intervene.

Where was his family, who would have had to be unconscious not to have known about his addictive tendencies? They were making money off his genius, as were the professionals who only wanted to get him on a stage one more time to rake in the dollars. He had paid security all day and night and they didn’t warn anyone. He had doctors - not just Murray - but a whole pocketful of doctors who did the minimum to try to stop him from killing himself with dangerous drugs.

Perhaps Michael Jackson had no friends, at least not after Lisa-Marie Presley and Brooke Shields quit the camp, possibly in the effort to avoid seeing at first hand what they knew was coming.

That leaves only his fans. They stuck by him. They idolized him. They grieved with him when he made mistakes and they celebrated with him when he succeeded. They wore copies of his clothes and learned how to do pretty good imitations of his moonwalk. But, we all know that fans are not friends. They are too far away to be real friends to a star.

Is that why he spent almost all his time with his children? They, at least, did not want money or reflected glory. They only wanted love, almost as much as he did.

It is an American tragedy, if ever there was one. And, deep down in our hearts, we all must feel a little guilty that we could not help the genius who brought us so much joy and love and human kindness and music and divine dance.

We are our brothers’ keepers, to be sure, but sometimes it is not an easy task.  

Joe Paterno's Sad Reckoning

The events at Penn State University this weekend have been so shocking and distressing to me that I must write something, and I apologize to my readers outside the United States and ask for their patience.

This weekend a grand jury in Pennsylvania indicted a retired defensive coordinator of the Penn State University football team, charging him with performing pedophilic acts with young boys for more than a decade under the noses of the University staff and administration.

If the allegations are true, the shock will ripple throughout Penn State University and far away into the corridors of amateur football and sports all over America.

A few facts :

Joe Paterno is the coach of the Penn State football team and has been for 50 years. He has won more games than any other coach of American university football ever, and he is the emblem of honesty and integrity. His care for the young men in the Penn State football program is legendary for its concern for the well-being of the boys who play football at Penn State. His system of caring for his players has made Penn State University one of the places parents most would like to see their sons play football. I hasten to add that none of the children allegedly abused was a football team member.

Joe Paterno is not a subject of inquiry in the scandal that is breaking over Penn State University’s head, but he was, according to the grand jury report, once told by a young football assistant trainer that he had seen abuse taking place in the shower area between the man now indicted and a young boy. Paterno told his supervisor in the University and promptly forgot about it, one presumes. The abuse allegedly went on for seven more years and included a group of young boys.

For Europeans, it might be compared to finding out that a pedophile was hidden in the ranks of Sir Alex Ferguson’s staff and abused the young boys who naturally gather around soccer teams.

I really don’t know what to think or say about this horrible affair. I feel revulsion for the entire University, which apparently thought that it had no duty to report the incidents to the police, but rather could handle them itself, and without even bothering to learn the names of all of the boys who might have been abused. The Washington Post today published a commentary that concludes that we should all now realize that even in university sports, it’s the money and status that counts, and not the life of one small boy.

We knew that many players at other schools were paid and given trips and cars, and that this was illegal under the rules that govern university sports in the United States, but I, for one, believed that Joe Paterno and Penn State were the shining city on the hill that proved that good could win the day in university sports, given the right environment.   

And, I’m from Pennsylvania, which makes the hurt even more profound. I feel genuine sorrow for Joe Paterno, and perhaps we will find after all is said and one, that nothing happened.

But Joe Paterno’s halo is gone forever. And, so is the dream we all had that with the right coach and the right support from a university administration, and with the love of sports for its own sake that is what university sports is ideally all about, that somehow, amateur sports could be something special and pure. The dream is over.

Governments Printing Money Is Always a Dangerous Business

It occurred to me today that one of the fundamental elements in the Eurozone sovereign debt crisis is not talked about at all, not by me or the professionals.

The element is that none of the Eurozone countries can print their own money. Just as no American state can print its own currency, the Eurozone countries are bound by the same rule.

Why is this important? Because it makes it impossible for a Eurozone country to solve its debt problem by printing more money.

That’s what America has been doing since long before WWII. When the tax revenues fall short of meeting the budget needs for the next fiscal year, the United States, in the form of the Federal Reserve, simply makes more Dollars available in the market by printing them. This works quite well as long as the world has faith in the ability of the country printing the extra currency to re-pay one day. That is why investors are willing to buy US Treasury bonds - they know that one day (the due date for the repayment of the principal) America will pay what it owes.

But, what if America could not print the extra currency (Dollars) it needs? There would be no money for the government to meet the demands of the budget - Social Security, Medicaid, Medicare, Bond interest payments, federal salaries, grants to education and research, military costs, national park costs, etc…) would not be paid. So, if America were not allowed to print the money it needs for current budget expenses, the federal government would quickly come to a grinding halt, after all tax revenues had been exhausted.

That, by the way, is the core of the argument between the left and right in American politics today. The left wants to continue to print Dollars with little restraint, while the right wants to put brakes on printing so many Dollars that eventually it will become impossible to pay back our creditors when the due date arrives. Neither side is saying ‘stop all printing.' They are arguing about how many Dollars are too many to print. That is why the right focuses on budget cuts - to put a cap on the printing of too many Dollars.

Now, with all that in mind, fast forward to Greece. Greece is a member country of the Eurozone. It is forbidden by treaty from printing the extra money (Euros) it needs to balance its budget each year, as are all Eurozone countries. They agreed when they created the Euro, that instead of printing Euros, each country would put a cap on its budget deficit at 3% of its gross national product.

The idea didn’t work, especially for the less industrial countries in the Eurozone, like Greece, Italy, Spain, Portugal and Ireland, whose economies are not robust enough to live within a 3% of GNP limit.  

That is why Greece is close to bankruptcy. That is why Italy is likely to become the next Eurozone country to be close to bankruptcy.  They need to be able to print enough money each year to make up for their budget deficits. The stronger Eurozone countries (Germany, France, The Netherlands) say, ‘too bad.’ You made a promise and you must keep it.  But, recently, even the stronger Eurozone countries have realized that it is impossible for the weaker Eurozone countries to live within their 3% straight-jacket. That is why Germany and France are leading the charge to provide additional money to Greece and why they are trying to help Greece get back to the 3% budget deficit limit. But, just today, German Chancellor Merkel said it would probably take at least 10 years. That, dear readers, can be read as ‘not in our lifetimes.’  

Just one last thing. Printing money is okay, but it deflates the value of all the money already printed and put into circulation. And, if too much money is printed, then the value of a country’s currency is so deflated that it becomes almost worthless.

We can make this point with an easy calculation. If there are 100 Dollars in circulation and each is worth 1 Dollar, the calculation is self-evident. The total value of the Dollars in circulation is 100. But, if 100 Dollars more are printed and put into circulation, then we have 200 Dollars and each is worth 1/2 Dollar because a total value of 100 divided by 200 Dollars is 50 cents (½ Dollar). Got it?

That is why printing money is always a tricky process and why stable, serious governments try to hold printing to a minimum.