Obama and the American dream in reverse
“It’s like the American dream in reverse.” That’s how President Barack Obama, ten days after taking office last year, described the plight of Americans hit by the faltering economy. His catchy description fell short — the dream has turned into a nightmare for tens of millions.
So much so that an opinion poll this week showed that 43 percent of those surveyed thought that “the American Dream” is a thing of the past. It “once held true” but no longer does. Only half the country believes the dream “still exists,” according to the poll, commissioned by ABC News and Yahoo against a background of dismal statistics on growing poverty, inequality, unemployment, and Americans without health insurance.
Before turning to the gloomy numbers, a brief detour to the meaning of the phrase “the American Dream,” long a familiar part of the U.S. (and international) lexicon. The survey defined it as “if you work hard, you get ahead.” That’s neat shorthand for the concept that the American social, economic and political system makes success possible for everyone.
More expansive definitions of the American Dream invariably feature home ownership, and there the dream went into reverse on a particularly large scale, with the subprime mortgage boom and subsequent housing bust. Last year alone, there were 2.8 million foreclosures — 7,700 a day — on homes whose owners could no longer afford their mortgages.
The statistic that best explains growing doubts over the achievability of the American Dream was released by the Census Bureau in mid-September. In 2009, the Bureau said, 3.8 million people joined the ranks of the poor by falling below the poverty line, defined by the government as an annual income of below $22,000 for a family of four.
In contrast, the net worth of the 400 richest Americans rose by a healthy eight percent in the year to August, according to a list by the business magazine Forbes published a week after the poverty figures. That perpetuated a rich-poor gap of proportions similar to the 1920s, before the Great Depression. For most of the past four decades, the annual incomes of the bottom 90 percent have changed relatively little while those of the top 1 percent have tripled.
In terms of equitable distribution of income and wealth, the U.S. is closer to Iran, Argentina or Mexico than to Canada or Germany. (That is according to the Gini index, a complex statistical measure of inequality named after Corrado Gini, the Italian economist who devised it in 1912.)
US intelligence spending – value for money?
America’s spy agencies are spending more money on obtaining intelligence than the rest of the world put together. Considerably more. To what extent they are providing value for money is an open question.
“Sometimes we are getting our money’s worth,” says John Pike, director of GlobalSecurity.org, a Washington think tank. “Sometimes I think it would be better to truck the money we spend to a large parking lot and set fire to it.”
The biggest post-Cold War miss of the sprawling intelligence community was its failure to connect the dots of separate warnings about the impending attack on New York and Washington on September 11, 2001. It also laid bare a persistent flaw in a system swamped by a tsunami of data collected through high-tech electronic means: not enough linguists to analyse information.
That problem was thrown into sharp focus by the government’s disclosure, long after September 11, that it had a 123,000-hour backlog of pre-attack taped message traffic in Middle Eastern languages, clear evidence of a system drowning in its own information.
The overall amount of money spent on the collection and analysis of intelligence as well as on covert actions and counter-intelligence by civilian agencies and the military was long shrouded in secrecy. It was disclosed last September by Dennis Blair, then President Barack Obama’s director of national intelligence: $75 billion a year.
No other country comes even close and no other country has as many people working in the intelligence industry — at least 200,000, counting private contractors. Russia and China lag behind.
“Nobody is quite as ambitious as the United States because nobody is trying to project global power as much as the U.S.,” said Steven Aftergood, an expert on intelligence spending who heads the Federation of American Scientists’ Project on Government Secrecy.
In terms of terrorist threats I think it is fair to say that intelligence is our only front line hope to success, it is quite clear from Afghanistan, Hamas, Yemen, Pakistan, etc. that armed confrontations cannot remove these threats. Really we are better off spending the money we do on intelligence than on the regular military.
As far as whether or not the money spent yields the results it should we must recognize a couple things, first the difficulty of dealing with the sheer amount of information our services need to deal with, and secondly how daunting it is to really reform entrenched bureaucratic interests. The first issue makes it clear how important the second issue is. By creating the Department of Homeland Security we had hoped to solve a lot of the problems we have in duplication of efforts and sharing of information between departments. It is clear that effort at reform fell short and that we need to revisit that.
It isn’t the money we spend, it is what we get in return for it.
Obama, Iran and Alice in Wonderland
Here we go again. That shape-shifting entity known as “the international community” has moved once more to try and stop Iran’s suspected nuclear weapons program. In the process, the community shrank by two countries, Turkey and Brazil.
That is the conclusion one can draw from President Barack Obama’s statements on the U.N. Security Council’s vote on June 9 to sanction Iran for failing to halt its production of nuclear fuel. The vote, Obama said, was “an unmistakable message” by the international community and showed its united view on Iran and nuclear arms.
That doesn’t quite square with the fact that Turkey and Brazil, two increasingly important players on the world scene, voted against the 15-member council’s resolution. (Lebanon abstained). But it confirmed an apparent tendency by Western leaders to draw inspiration from Alice in Wonderland (where Iran is concerned).
They echo Humpty Dumpty’s famous assertion on the use of words: “When I use a word, it means just what I choose it to mean — neither more nor less.” The modern, Iran-related version: “When I talk about the international community, I mean those who are with me. Neither more nor less.”
The June 9 resolution vote was the fourth on sanctions and the first with “no” votes. In 2006 and 2007 sanctions resolutions passed unanimously. In 2008, one council member, Indonesia, abstained.
Obama termed the new sanctions the most comprehensive the Iranian government had faced but said they did not close the door to diplomacy. If that were to happen, he would serve the cause of international diplomacy by setting an example and burying the over-used and empty phrase “international community” with its misleading implication of global consensus.
The question now is whether the latest set of sanctions will have any more effect on the Iranian nuclear programme than the preceding ones and even Obama expressed doubts: “We know that the Iranian government will not change its behaviour overnight.”
Iran and North Korea need to battle it out. We just launched a Facebook competitor at story+burn.com
Obama, Karzai and an Afghan mirage
Last year, under the leadership of President Hamid Karzai, Afghanistan slipped three places on a widely respected international index of corruption and became the world’s second-most corrupt country. It now ranks 179th out of 180, a place long held by Somalia.
According to a United Nations report published in January, Afghans paid $2.5 billion in bribes in 2009, roughly a quarter of the country’s Gross Domestic Product (not counting revenue from the opium trade). The survey, based on interviews with 7,600 people, said corruption was the biggest concern of Afghans.
On the military front in a war more than halfway through its ninth year, attacks on U.S. forces and their NATO allies totaled 21,000 in 2009, a 75 percent increase over 2008, according to a report by the Government Accountability Office (GAO) a week before Karzai’s visit to Washington. The GAO, the investigative arm of Congress, noted that Taliban insurgents had set up a “widespread paramilitary shadow government…in a majority of Afghanistan’s 34 provinces.”
The Pentagon, also in advance of Karzai’s visit (in the second week of May), reported that Afghans support his government in only 29 of the 121 districts the U.S. military consider most strategically important.
“The insurgents perceive 2009 as their most successful year,” the Pentagon said. “The Afghan insurgency has. ..a ready supply of recruits drawn from the frustrated population, where insurgents exploit poverty, tribal friction and lack of governance to grow their ranks.” As to corruption: “Real…change remains elusive and political will, in particular, remains doubtful.”
In case all this has led you to the conclusion that the Afghan glass is half empty at best, that’s not the way President Barack Obama and his Secretary of State Hillary Clinton portrayed it during Karzai’s visit. Yes, there were difficulties ahead, they said, but overall things were looking up. “We are steadily making progress,” Obama said. “Progress in Afghanistan is real,” echoed Clinton.
Was this a matter of two leaders seeing a mirage, or a 21st century version of the “we see light at the end of the tunnel” assurance Americans heard during the Vietnam war? Or was it simply overdue recognition that Obama is stuck with Karzai no matter how unpopular he might be or how much credibility he lacks?
@avid
Perhaps you should try to clarify the so called ‘capability’ which the USA has but was not able to defeat the so called enemy in Korea and Vietnam?
Rex Minor
America’s season of rage and fear
Freedom in America will soon be a fading memory. American exceptionalism died on March 23, 2010. On that day, the United States started becoming just like any other country. Worse still, like a West European country. Socialism in the land of the free and the home of the brave!
In a nutshell, that’s how many conservatives see the health reform bill President Barack Obama signed into law on March 23, after a year of acrimonious debate. The language has been shrill and the superheated political temperature is reflected by worried headlines such as “The heat is on. We may get burned” (Wall Street Journal) or “Putting out the flames” (Washington Post).
Verbal venom is not restricted to radio talk shows or Internet rants that draw parallels between Obama and Hitler or Stalin. John Boehner, the leader of the Republican party in the House of Representatives, described the reform as Armageddon and a Republican congresswoman, Michelle Bachmann, voiced fears on national television for her country’s future because of the president’s “anti-American views.”
Today’s end-of-freedom arguments sound very much like the ideas set out in a 1961 speech by the late Ronald Reagan, then an actor working as a corporate spokesman, now venerated as a secular saint by many Republicans. “One of the traditional methods of imposing statism or socialism on a people,” he said, “has been by way of medicine.”
Reagan was raising the alarm against an early version of what became Medicare, the government-run health care programme for people over 65 which now has 45 million beneficiaries, most of whom rate it more highly than private health insurance, according to surveys. If the program were passed, Reagan warned, “behind it will come other federal programmes that will invade every area of freedom as we have known it in this country. Until one day… we will awake to find that we have socialism.”
Medicare was passed in 1965. Dark warnings notwithstanding, the United States remained the engine of global capitalism. It is also the world’s only advanced industrial country without universal health care (except for the elderly), with more than 40 million uninsured for whom illness can mean financial ruin or early death.
In the hubbub, which is growing rather than subsiding, it’s worth noting that people arguing from opposite ends are coming to the same conclusion — health care reform is not the underlying reason for the anger vented against the government.
Fear and loathing in Las Vegas, Gonzo.
Smear and looting in Washington, Anon
Mickey’s Magic needed for Disneyland Shanghai
– Wei Gu is a Reuters columnist. The opinions expressed are her own —
China has finally given a green light for Disneyland to build a theme park in Shanghai. Negotiations that started when Bill Clinton was in the White House have concluded just before President Barack Obama is due to visit. The approval looks like a coup for Walt Disney Co, but it will take all of Mickey’s magic to prevent the park from becoming another government-financed loss maker.
Disney’s last theme park in the region was anything but a hit. Hong Kong Disneyland was created in 2005 in an effort to boost employment in the epidemic-stricken region, but attendance numbers have fallen short of target. This hits the Hong Kong government harder than Disney, because the former not only took an initial 57 percent equity stake in the venture, but also spent $1.75 billion building related infrastructure like a metro line and ferry piers.
Shanghai Disneyland is likely to be financed in the same way. Estimates for the park’s price tag are around $4 billion. The government and a group of Chinese companies will contribute about 60 percent of equity, with Disney paying for the rest. The Shanghai government is also likely to pay for the roads leading to the park.
The Hong Kong park has been a disappointment for a number of reasons, some of which might equally be relevant in Shanghai. It is the smallest Disneyland in the world, so it is crowded and not worth visiting for a second day. Culturally, locals identify more with the Ocean Park, which features pandas and sharks and is cheaper. Hong Kong Disneyland’s public image has also taken a hit from a bout of food poisoning and accusations that it has exaggerated visitor numbers.
The Shanghai park will be 3-4 times bigger than the one in Hong Kong, making space for more visitors. But this will also increase the cost of relocating current residents. Some locals are busy adding a second floor to their homes so they can demand more compensation when they move out.
Shanghai has twice Hong Kong’s population, but average income is only about a quarter that of its wealthier neighbour, so it’s far from clear how many visitors will be able to afford a ticket that will cost the equivalent of two days of earnings for a college graduate. Then there is the possibility that the Shanghai park will divert visitors from Hong Kong.
Sit back and enjoy the Kabuki trade show
–James Saft is a Reuters columnist. The opinions expressed are his own.–
Financial markets have plenty to be worried about but their latest concern — a trade war between the United States and China — should not be on the list.
Aligned self interest and a knowledge on both sides of the causes of the Great Depression should limit matters to a kind of trade war Kabuki, a highly stylized piece of theatre in which the United States shakes its fist and China responds in kind but no blows land.
The Obama administration on Friday slapped tariffs of 35 percent on the import of auto tires from China, reacting to a surge in imports and complaints from the United Steelworkers union. It also acted on the recommendation of the independent U.S. International Trade Commission.
China duly responded, announcing investigations into subsidies made to U.S. chicken producers and auto products, as well as vowing to take its case to the World Trade Organization.
Shares around the world sold off on Monday at least partly in response to the dispute, which awakened memories of the 1930 Smoot-Hawley tariffs and the trade war that ensued, a key cause of the Great Depression.
What’s worse, the United States is not just spitting into the wind of history but also into the face of its largest creditor. China holds about $1.8 trillion of Treasuries and any decision on their part to lighten up would send the dollar into a steep decline and torpedo U.S. plans to fund its fiscal deficit.
James, you say the right things and will most probably become the Governor of Alaska soon, but I beg to differ. The US doesn’t sell sick chickens to China. Just because you are a large creditor, doesn’t mean that I have to market and buy your poor products. The time is now for ultra conservative protectionist policies, a tit-for-tat uprising, an enchilada, and I am a big lefty.
Paul and Andrew have good points – the long of the short, though, while not fully ignoring subsidies and tariffs, purchase power parity, interest and dividend rate parity and exchange rate parity generally equalises the true value of trade Worldwide.
To create the United States required the intellect and the painstaking debates of the Founding Fathers; to run it into the ground, only the crew of anti-intellectuals now ensconced in Washington.
“No thought, knowledge, or consistency is required in order to destroy,” writes Ayn Rand,
unremitting thought, enormous knowledge, and a ruthless consistency are required in order to achieve or create. Every error, evasion, or contradiction helps the goal of destruction; only reason and logic can advance the goal of construction. The negative requires an absence (ignorance, impotence, irrationality); the positive requires a presence, an existent (knowledge, efficacy, thought).
Evil men, though impotent, can disappoint, deceive, and betray the innocent; if they turn to crime, they can rob, enslave, and kill. This is one reason that man needs to practice the virtue of justice (to distinguish between the good and the evil). Peikoff, L. 1991
The Objectivism Research CD Rom: The Works of Ayn Rand [CD-ROM]. Available: http://www.amazon.com/Objectivism-Resear ch-CD-Rom-Works/dp/0971178704 Accessed on 2010/09/21