Month: October 2012

The Buffalo Waterfront Stadium: In Defense of Skepticism

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We will operate here under the assumption that everyone wants the Bills to stay in the area. You don’t have to be a football fan or have a #billsmafia on your Twitter avatar to understand that the Bills are an economic engine, a source of civic pride, and a symbol of good days passed, and hope for the future.  Even if I am dismissive of throwing a billion dollars at a game of catch, that doesn’t mean I want Ralph’s post-concussion-syndrome follies to move to Los Angeles. 

Yesterday, Chris Smith and Brad Riter led the cheer for the $1.4 billion “conversation starter” stadium proposal. If you missed it over at Trending Buffalo, listen here right now. 

TBOneThing10-24-12.mp3

OK. 

Would that replication of Singapore – a gleaming new Asian Tiger of a Buffalo downtown be great to build on Lake Erie? Sure. Would a new stadium complex that involves the construction of about six bridges, the redevelopment of tainted land, nestled alongside the flour and cereal processors be nice? Sure; that would be great. Would it be fantastic if the Buffalo Bills stayed here in perpetuity, playing in a state-of-the-art stadium? Of course it would.  

We are, however, in “would be nice” territory, and decidedly removed from “must happen”. 

And we’re talking about a city that – over 20 years – can’t get it together to expand the Peace Bridge or its plaza, for considerably less money. 

Even if you argue – as both Brad and Chris do – that a new stadium is the sine qua non – the “must happen” of the Bills’ continued existence in western New York, why does it have to involve everything contained within the Greater Buffalo Sports and Entertainment Center (hereinafter “GBSEC”) proposal?  Why are we building a new home for the Jetsons when what we really need is a less crappy stadium with a dome to keep out the weather, and nicer toilets? As much as it makes sense to appeal to fans, you have to also appeal to people who don’t care. 

We’re a small town with small money. Propose away, but the scale of GBSEC’s proposal is way outside the “reasonable” scale.

Click to enlarge

 Brad’s opening premise is that it makes more sense to spend $1.4 billion on a new stadium than $200 million on the Ralph. That’s great, except we’re talking about fantasy-dollars; dollars no one has. 

First, GBSEC spends several pages’ worth of its presentation creating a whole new downtown, connected to the existing one. We already have a downtown. No one much likes it, and no one much goes there, except for court, the Sabres, and the theater. Would building a sur-downtown have a stimulative effect on the existing one? It would, if the proponents of Mos Eisley-on-the-Lake didn’t factor in the current state of downtown’s ridiculous parking supply into its plan. It doesn’t assume – it doesn’t much allow – our current downtown to change. Much simpler and cheaper would be to let our existing downtown grow organically by giving it a competitive advantage; say, a sales-tax free zone. 

Secondly, the Bills already have a stadium. I’ve never been in it, so I’ll take Brad’s word for it that it’s really awful. We’re also having a hard time filling it, partly because the team tends to be horrible, but also because of demographics and economics. The region is shrinking. Things like high gas prices take a bite out of people’s discretionary budgets, and it’s harder to add “game” to “food” and “utilities”. We’re having quite the civic discussion over spending $200 million – a teeny drop in the GBSEC bucket – to fix the Ralph up and make it less horrible.  Notwithstanding the assumption I propose above, a lot of people would rather see the Bills leave than assign public money to this idea. The Buffalo Bills NFL franchise is worth almost a billion dollars. Its owner is in his 90s, and recently becomes unwell with greater frequency. It’s a hard sell to tell a blue-collar, hardworking, shrinking region that a billion-dollar business needs welfare to help build it a new home. 

If $200 million is a tough sell, who swoops in and says, “$1.4 billion’ll do the trick!”?  Of course, we’re assuming there will be some outlay of public money for this because that’s how these things go. If the state and county don’t play ball, some other city will offer up a much sweeter pot; backyard deers or no.

We talk about the megaregion as being the key to the Bills’ continued viability here, and locating in WNY is geographically the least-inconvenient place. But how much is Rogers going to put up? How much is the Government of Ontario or Canada’s Federal Government going to put up to keep this megaregional asset in WNY? How much is Monroe County going to contribute? What about Niagara County? Why do Erie County taxpayers shoulder such a large fiscal burden for what’s being billed as a multinational attraction? Also, has Toronto really bought into being Bills country? How are tickets selling at the Rogers Centre, another Great Lakes retractable-roof location that had the good fortune to locate itself in an existing urban downtown? 

Brad and Chris say this all is starting a conversation. But you start conversations by saying, “what if we built them a new, domed stadium in Orchard Park”. Then the conversation may – or may not – progress to, “hey, how about a stadium with a retractable roof on the Outer Harbor. It would cost [insert reasonable, sub-billion-dollar figure here].” Then you expand, and move on to alternate ideas – siting it in Niagara County to be closer to Rochester and Toronto, for example. Perhaps then you suggest coupling the project – wherever it is – with a new, less horrible convention center and maybe a hotel. 

Even if the project GBSEC proposed had contained only a stadium, hotel, and convention center, it would be something within the world of reason. But you have to convince people of the underlying premise before you throw this whole new city at them. 

In the podcast, Brad argues that we oughtn’t compare the Bills proposal to what happened in New York and Dallas. Why not? Maybe because the markets are so different, but the dollar figures are quite similar.

The new Yankee Stadium, which houses the wealthiest, most successful sports franchise in America, cost $1.5 billion. The new Citi Field in Queens, which hosts the New York Mets, cost $850 million, paid through the sale of New York City bonds, to be repaid by the Mets with interest in lieu of property taxes. The home of two teams – the Jets and Giants – cost $1.6 billion and was the most expensive domestic stadium, ever. So, lets understand that what GBSEC is proposing is on a par with what happened in New York. Dallas?  Dallas’ Cowboy Stadium cost $1.4 billion in 2012 dollars. 

By contrast, Green Bay’s municipally owned Lambeau Field is ancient and was renovated a couple of years ago for less than $300 million. It’s still going strong in a small-town market, mostly because the team is owned by the community. 

The difference, of course, is that Dallas-Fort Worth and the New York tristate area are already large, interconnected economic regions. The Dallas-Fort Worth Metroplex boasts 6.5 million people across 13 counties. The New York tristate area has about 20 million people within its immediate, contiguous metropolitan area. All of these metros have the added benefit of being located within the same nation-state. 

Even if one were to make the argument that a billion-plus dollar megaplex on Lake Erie could be a centerpiece to finally recognize the interdependency of a Tor-Buff-Chester metropolitan area, it would be superficial, at best.  The fact is that these are neither politically nor geographically contiguous areas, spanning two countries and three major media markets. Even Tor-Buff-Chester itself is a different concept altogether. It’s a megaregion like Boston-New York-Washington, not its own metro. Back in 2007, Richard Florida estimated that the megaregion he defines had about 22 million people in it, strewn across a geography from Quebec City to Syracuse to London, ON. That’s quite a spread. 

How credible is this plan? Brad and Chris argue that George Hasiotis is a respected businessguy who is well-connected politically. He is. Some point to the fact that GBSEC honcho Nicholas Stracick won a $240 million judgment against Disney, and must be flush with cash. That’s until you realize that he split the money with someone else. After taxes. And after they settled for a much smaller amount from Disney to avoid the verdict going up on appeal.  

Indeed, Stracick has already recommended that Andrew Cuomo’s billion dollars for Buffalo be spent towards this plan. A $1 billion fund that’s supposed to set the region up for a 21st century economy – should it be spent on an entertainment zone? 

Why can’t it happen? Anything can happen. Someone could swoop in tomorrow with no backing and a set of nice pictures and propose a building taller than the Burj Khalifa be built on the Outer Harbor. Or maybe a charismatic Iraqi-British con artist could swoop into town to promise to renovate a beloved grande dame of a building, despite having never really developed anything to completion, anywhere. People are skeptical about this because its outlandishness, and Buffalo’s experience, gives people a fundamental right to be suspicious and skeptical. It involves a couple of unknowns who had the cash to commission expensive plans and diagrams. It involves politics and politicians, which means you have to question everyone’s motives ab initio. A $250,000 investment in HKS diagrams isn’t a lot when control over this waterfront property is at stake and being argued about; the NFTA is playing a massive game of keepaway between the city and the state/Canalside. 

If you like the idea of a waterfront retractable-roof stadium, I’m with you. If you like it being paired with a hotel and a new convention center, I’ll go along with that. But when you basically propose taking the area around General Mills and suggest building a new Shinjuku district, we have a problem. 

If Citi Field can be built on some of the most expensive real estate in the country for $850 million, I have a hard time believing that it costs almost twice that to build three things on a barren piece of wasteland on Buffalo’s Outer Harbor. 

Why We Shouldn’t Privatize All the Things

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Here’s why it’s horrible to let private entities privately own necessary infrastructure. The Canadian government is offering to build – at its sole cost – a new bridge crossing between Ontario and Michigan, just South from Detroit. The Maroun family, which owns the private Ambassador Bridge – the only truck crossing in Detroit – has mounted an ad  blitz to oppose the new, free bridge. And it’s working.

 

And An Elevator To the Moon

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Not real, authentic (This Stadium Matters; Stadium, For Real)

Way back in late 2004/early 2005, one of the first Buffalocentric topics about which I decided to write was an NFTA debate that was then brewing over three competing plans for Buffalo’s beleaguered, forgotten Outer Harbor. Eight or so years later, it remains almost equally beleaguered, with some aesthetic and functional improvements in access, but still amounting to grass and weeds. Eight or so years later, the NFTA still controls it, while the Erie Canal Harbor Development Corporation and the City of Buffalo bicker over who should control its development, and the contracts and jobs that go with it. 

What else have we seen? We’ve seen that while civic debate focuses on extremes, we are capable of reaching compromise when necessary. For instance, attracting a Bass Pro to the waterfront – it wasn’t at all a bad idea. Putting it in the Aud, on the Aud site, or even right up against the water at the foot of Main Street – none of those were per se bad ideas. But Bass Pro isn’t coming, and that, too, is OK. We don’t need it, but it wouldn’t have hurt. On the other side of the argument, we had the armies of preservation demanding green space, no buildings against the water, “authenticity” as defined by them, and now a fetish for defunct grain elevators and warehouses that haven’t been demolished because there is no one to pay to demolish them – haven’t been used because they are economically difficult to justify re-using. In spite of the Fred Kent placemaking sideshow scam, Buffalonians seem pretty happy with the compromise Canalside being built, the Pegula hockeytorium, and the other incremental – but, finally, visible and palpable – improvements being done to the Inner Harbor. 

So, we look again to the Outer Harbor and we have a new proposal being trial-ballooned whereby we build a billion-and-a-half-dollar stadium for the Buffalo Bills with a retractable roof, a new convention center, a hotel complex, and 5,000 parking spots. Of the silver bullet proposals to come down the road, this is the silveriest, bulletiest of them all.  This has a former county comptroller candidate involved in commissioning an epic set of images showing off our newest Elevator to the Moon, complete with a sports museum to be built and run by the people behind Rochester’s Strong Museum of Play. 

Neighborhoods crumble under the weight of economic decay and desperation, and we have $1.5 billion to spend on playing catch? We struggle to make ends meet with Medicaid funding, heating assistance, and day care for the working poor, and we’ll throw a billion dollars at a hotel and Buffalo Skydome? Is there even a local corporate sponsor who will buy naming rights, or will we just name it after Ralph Wilson, too? Renovating the Ralph is estimated to cost $200 million, which is also a tremendous sum of money for this area, and even that is a deal not yet done. For decades this region has been trampled underfoot by opportunistic politicians with toxic policies, and we have yet to devise an attainable vision for the future and a concomitant plan to get there.  But, hey – domed. Stadium. 

Functionally, the Outer Harbor is a geographical bottleneck – accessible by Skyway or on Route 5 from the South or in from Tifft Blvd from South Buffalo.  Three points of entry to get to 5,000 parking spots to service a stadium for 72,000 people. Arithmetically, the people behind this proposal think that the state will pony up $400 million, and that the NFL will provide between $200 to $400 million. That leaves a gap of $700 to $900 million that needs to be filled by private investment and, presumably, county money. That kind of money approaches the county’s entire annual budget. As a practical matter, the soil on the Outer Harbor is toxic and in need of multimillion dollar remediation. 

But we’re still debating the likelihood that the Bills stay in this region after their owner inevitably passes away in the near future. The team is more than just a sports franchise – it’s a powerful symbol reminding Buffalo that it was once in the major leagues; a legacy we cling to by a thread.  Does this area have enough idle money lying around to (a) enable local investors to buy the Bills and keep them here when Wilson dies; and (b) fund a massive stadium project for the Outer Harbor, which would effectively prohibit any other kind of development from happening there? 

So here we are, with a massive silver bullet pipe dream to try and keep our disappointing football team in town. A shiny object to raise the hopes of the few not yet beaten down by inevitable cynicism; something to occupy hours’ worth of inane AM talk radio chatter, with angry people talking angrily about their anger over money and the crappy team. This has the appearance of being aspirational, but is really evidence of desperation. If we give the Bills this nice new home, maybe they’ll stay. Maybe they’ll stop sucking. On the other hand, we’ll have the self-appointed masters of authenticity decry any proposal involving sports, parking, roadways. We’ll have arguments about how we should spend a billion dollars to improve storefronts on Grant Street, or maybe to spend on more ancillary projects at the Darwin Martin House. We’ll hear how Buffalo is “real” and “authentic” and that this monstrosity does nothing to further enhance our standing as a tertiary stopover on the cultural tourism checklist. We’ll ultimately argue over how many trees and painted Adirondack chairs are available on the grass, whether the water taxi will be able to accommodate gameday crowds, and hey, how about a solar-powered carousel? 

But let’s cut through all the hype. The people proposing this have two things – a corporate entity and some diagrams. They haven’t talked to the Bills. They haven’t talked to the NFL. They haven’t talked to the State. They haven’t talked to ECHDC. They haven’t talked to the NFTA. They haven’t even taken a survey of the local population to vet the idea of a billion-dollar domed stadium on the Outer Harbor. So far, they’re scheduled only to speak with the City of Buffalo – an entity that has, and would have, no say in the matter whatsoever. We haven’t yet figured out how we’re going to fix up Ralph Wilson Stadium, and we’re already talking about out-Torontoing Toronto’s downtown Rogers Centre. 

This ought to be fun. 

 

 

Horses and Bayonets on the Morrow

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In debate the first, Alpha Romney showed up and stylistically, if not factually, defeated a sleepy Obama. In debate two, electric boogaloo, Romney and Obama both came to the knife fight with guns a-blazing. 

Last night, in debate number three, Alpha Obama went on offense against a stammering, sweaty Romney who, at times, seemed as if Sarah Palin had helped with debate prep. When Obama criticized Romney’s incoherence on various foreign policy matters, Romney whined, “attacking me is not a plan”. It was repeated at least twice, and sounded weak, sorrowful, and pathetic. Obama’s cross-examination of Romney on his prior inconsistent statements was effective and decidedly well-hinged.

For instance, at the first debate, Romney had complained that the 2014 deadline to leave Afghanistan was something he agreed with, except insofar as it telegraphs to our enemy that all bets are off after that. It’s a disingenuous weasel answer, and one that Romney completely abandoned last night, instead claiming to back the 2014 date. From TPM, Obama: 

You said that first we should not have a timeline in Afghanistan, then you said we should. Now you say maybe or it depends. Which means not only were you wrong, but you were confused and sending mixed messages to our troops and allies.

In 2008, Romney said we shouldn’t move “heaven and earth” to get Osama bin Laden, and that we should first ask Pakistan for permission.  Obama recounted meeting the daughter of a 9/11 victim, which reaffirmed to him that moving heaven and earth was exactly the right thing to do; “worth it”, 

“[Y]ou said we shouldn’t move heaven and earth to get one man,” Obama said. “If we would have asked Pakistan for permission, we wouldn’t have got him.”

On Russia: 

“I’m glad that you recognize al Qaeda is a threat. Because a few months ago when you were asked the biggest threat facing America, you said Russia,” Obama said. “The Cold War has been over for 20 years. But governor, when it comes to our foreign policy, you seem to want to import the foreign policies of the 1980s, just like the social policies of the 1950s and the economic policies of the 1920s.”

Later Obama said directly to Romney, “You indicated that we shouldn’t be passing nuclear treaties with Russia, despite the fact that 71 senators, Democrats and Republicans, voted for it.”

Romney repeatedly claimed to be the candidate of peace – he rebutted the elimination of Osama bin Laden with “we can’t kill our way out of this mess“. Romney tried to attack Obama from the left on this, and everything about it reeked of phoniness. The guy who has John Bolton on his foreign policy team isn’t the McGovernesque peace candidate.  On Iran, Romney actually suggested that some unnamed “world court” indict Ahmadinejad for genocide. That’s nice, but the United States has nothing whatsoever to do with the International Criminal Tribunal. And how does that jibe with the Republican anti-world-government, anti-UN, US must do everything mantras? It’s a desperate ploy by a desperate candidate. 

If, at the foreign policy debate, Romney can get no traction on his Libya attacks, he’s lost. 

Throughout the night, Alpha Obama was the calm, rational, factual counterpoint to Romney’s rushed stream of consciousness. He also gave Romney nary an inch to repeat falsehoods or reinvent history. Obama pre-empted Romney’s predictable attacks about Israel with yet another “Libya moment”. One of Romney’s clumsiest attacks was to accuse Obama of weakening our military by pointing out that the Navy has fewer “ships” now than it did in 1916(!). Obama snarkily obliterated that argument, and it was a highlight of the night – a “you’re no Jack Kennedy” moment. 

[youtube http://www.youtube.com/watch?v=DN283AUxSIA]

Funny aside – someone on Facebook mentioned that Fox News “fact-checked” the assertion that the military doesn’t use bayonets anymore by pointing out that Marines have them. Except for the fact that the President said “fewer”, not “none”. Now we’re fact-checking deliberately false fact-checking. 

But except when they veered to domestic policy issues that are swing-state friendly, it was astonishing just how much Romney agreed with every foreign policy thing Obama’s doing, or has done. He liked everything! Romney was reduced to using long strings of words to say he’d do exactly the same thing, only perhaps louder or faster. 

In their closing arguments, Obama pivoted back to hope and staying on a path to move forward, rather than back. Romney did his best Reagan impression, but ended up sounding and looking more like a more WASPy Billy Fucillo, who really wants to see you in this purple Hyundai with low miles and EZ-terms. 

Some highlights: 

In response to Romney’s accusation about an “apology tour” where Obama purportedly ignored Israel. This was quite the Libya moment. Please proceed, Governor:

[youtube http://www.youtube.com/watch?v=VV4XPKJ-v5c]

Closing with hope :

[youtube http://www.youtube.com/watch?v=A2pnjuUT5jg]

Registration Fraud + Poll Tax

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The Sprouls with Mr. Romney

This isn’t as big a story in the mainstream media because it hasn’t hit Drudge and Fox – most likely because it involves a pricey, private, Caucasian consultancy rather than “new Black Panthers” or ACORN or just regular folks. 

You won’t see this story on Drudge and Fox because it can’t be spun to show Black people to be lawless savages who have the nerve to participate in our electoral process. 

But while the Republicans press for a poll tax to dissuade poor folks from voting (using “voter fraud” as a pretext), and although that sort of voter identity fraud has almost never happened, ever, we now have a brewing swing-state scandal where that consultancy hired first by the RNC – then fired when fraudulent registrations popped up in Florida, Colorado, and Virginia.  The Virginia Republican Committee quickly hired the firm that had been hiring workers for the fired consultancy, and somehow, some of those registrations have been found in a Pennsylvania dumpster. 

Strategic Allied is owned by Nathan Sproul, an Arizona political consultant for Republicans whose companies have faced charges in past elections of submitting forged forms and of dumping Democratic registrations. None of the charges were proved, and Sproul continues to do get-out-the-vote work for conservative causes this election.

In fact, the RNC has paid Sproul’s Strategic Allied $1.3 million over the course of the 2012 election to “register” voters. The RNC fired them after a bunch of fraudulent registrations popped up in Florida. Over the last nine years, that number has been $21.2 million.  

It also appears that the arrested former Strategic Allied worker, Colin Small, was re-hired by PinPoint Staffing, which Strategic Allied had used to hire people. The Virginia GOP in spite of – or because of – the allegations against Strategic Allied, retained PinPoint to provide staffers to “register” voters. Imagine you stop at your college’s student union to re-register to vote at your current address, and when the deadline passes you check to make sure everything went through, and nothing had changed. 

It’s a two-front war to help disenfranchise the poor and minorities, and therefore help Republican candidates. Long gone are the days of the GOP’s big tent – now, the tent door is shut, and it has reverted to agitation for a poll tax on the one hand, and ignoring or encouraging registration fraud on the other.  The Brad Blog goes into excruciating detail. 

Gas and the Dow

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During the second Presidential debate, this exchange happened: 

MR. ROMNEY:…If you’re paying less than you paid a year or two ago, why, then the strategy is working. But you’re paying more. When the president took office, the price of gasoline here in Nassau County was about a buck eighty-six a gallon. Now it’s four bucks a gallon. Price of electricity is up.

If the president’s energy policies are working, you’re going to see the cost of energy come down. I will fight to create more energy in this country to get America energy-secure. And part of that is bringing in a pipeline of oil from Canada, taking advantage of the oil and coal we have here, drilling offshore in Alaska, drilling offshore in Virginia where the people want it.

MS. CROWLEY: Let me —

MR. ROMNEY: Those things will get us the energy we need.

MS. CROWLEY: Mr. President, could you address — because we did finally get to gas prices here — could you address what the governor said, which is: If your energy policy was working, the price of gasoline would not be $4 a gallon here. Is that true?

PRESIDENT OBAMA: Well, think about what the governor — think about what the governor just said. He said when I took office, the price of gasoline was 1.80 (dollars), 1.86 (dollars). Why is that? Because the economy was on the verge of collapse; because we were about to go through the worst recession since the Great Depression as a consequence of some of the same policies that Governor Romney is now promoting. So it’s conceivable that Governor Romney could bring down gas prices, because with his policies we might be back in that same mess. (Audience murmurs.)

I’ve seen a bunch of Republicans make this charge – that it’s Obama’s fault that gas prices have skyrocketed from a reasonable $1.80/gallon to the current $4.00/gallon. But that is so fundamentally misleading – such a basic symptom of Romnesia. 

If it’s Obama’s fault that gas prices have gone from $1.80/gal in February 2009 to $4.00/gal in October 2013, then it’s also his fault that the Dow Jones Industrial Average has skyrocketed from 8,000 to 13,300 in that same time. 

 

What else? Well, let’s take a look at some more trends. 

Retail Sales: 

 Unemployment: 

Car sales: 

Highest since 2007: 

So, don’t listen to the doom and gloom, and don’t succumb to Romnesia, whereby you completely forget what happened in 2008. 

Romney’s Math Doesn’t Add Up

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The Democratic Party put up a funny website that is designed to look like something from the Romney/Ryan campaign, and pokes fun at the fact that Romney’s tax plan is backed up by a complete absence of any salient details. 

Now, those dirty redistributive Kenyan socialists at Forbes and the Council on Foreign Relations have an even bigger bombshell to share. Romney/Ryan promise to reduce the income tax on the wealthy by 20% – this costs America $2.5 trillion. They promise to eliminate the Alternative Minimum Tax, costing America $700 billion.  A repeal of the high-income payroll tax will cost another $300 billion in revenue. Corporations will get another $1 trillion tax cut. 

So, how does the government pay for that, and not affect the deficit? Here’s what Forbes’ Robert Lenzer has to say: 

Then, comes the problem, the headache, or maybe its the head fake. No identification of a single loophole that will be closed. No concrete exposition about raising the capital gains tax on rich people. Our friends at the Democratic Party headquarters have estimated the savings for “ending all tax benefits for the wealthy” at $1.7 trillion; eliminating ALL corporate tax benefits to offset the corporate tax cut- $1.1 trillion and then another $1 trillion of middle class tax benefits to pay for the middle class cut=- another $1 trillion.

Imagine the chaos, the bitterness, the social unrest that would occur. But, then realize these measures only get back $4 trillion. There’s another $1 trillion to go.

Even studies by that staunch Republican economist Martin Feldstein and Princeton economist Harvey Rosen “concede that paying for Romney’s tax cuts would require large tax increases on families making between $100,000 and $200,000. So much for campaign rhetoric favoring the 1% over the 99%.

 The Forbes article cites this one from the Council on Foreign Relations, which adds a chart to help aid in the analysis. 

At the VP debate, candidate Paul Ryan said that his ticket would lower marginal tax rates by eliminating $1.1 trillion in loopholes and deductions for high-income taxpayers. But the chart above shows those loopholes and deductions, and a full 30% of that $1.1 trillion has been deemed by Romney to be untouchable. So, they only account for $770 billion of their promised $1.1 trillion. 

Mitt Romney can lurch to the center all he wants, but he doesn’t want to change the system to benefit the middle class and the working poor – he’s done quite well under the status quo and has no incentive to change a thing. Romney and his running mate can brazenly lie and make promises that don’t mathematically add up, and seldom does it meet with much pushback because seriously, most people – most journalists – aren’t economists. 

Politicizing Security

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Orwellian

In August 2004 – in the immediate aftermath of the Democratic National Convention, any momentum Senator Kerry had coming out of it was halted by the Bush Department of Homeland Security raising the terrorist threat level from yellow to orange for financial institutions in some cities. It reeked of petty political opportunism and dirty Karl Rove trickery. As it turns out, former DHS Secretary Tom Ridge later admitted it was exactly that. 

The threat level reverted to yellow just a week after Bush’s re-election. Mission accomplished, as they say.

The idiotic threat level system – designed for simpletons, by simpletons – has since been abolished. 

When we talk about fraud and political opportunism, we should have longer memories. The world didn’t begin in 2008.

America, Romney, and the Middle Class

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I realize that Chris linked to this in today’s Grumpy, and I apologize for the redundancy, but it really deserves to be highlighted on its own because it involves a local company – Delphi – and its buyout, bailout, and retirees. Delphi still operates in Lockport, and it has a long history in western New York back to the days of Harrison Radiator. Like Trico, it has taken advantage of Mexico’s maquila system, whereby American companies send parts to Mexico for assembly, and can repatriate the finished products duty-free thanks to NAFTA. Despite taking advantage of cheap Mexican labor, Delphi still found itself in deep trouble. 

When in the midst of the global financial meltdown of 2008, GM was facing imminent collapse, the liquidation of Delphi would have been catastrophic. To replace Delphi’s supply pipeline would have cost GM tens of billions of dollars and many years. Had Delphi been allowed to go under, GM’s rescue would have been impossible – bailout or no. 

Rattner could not believe that Delphi’s management—now effectively under the hedge funders’ control—would “want to be perceived as holding GM hostage at such a precarious economic moment.” One Wall Street Journalanalyst suggested that Singer was treating Delphi “like a third world country.” Rattner likened the subsidies demanded by Delphi’s debt holders to “extortion demands by the Barbary pirates.”

Romney has slammed the bailout as a payoff to the auto workers union. But that certainly wasn’t true for the bailout of Delphi. Once the hedge funders, including Singer—a deep-pocketed right-wing donor and activist who serves as chair of the conservative, anti-union Manhattan Institute—took control of the firm, they rid Delphi of every single one of its 25,200 unionized workers.

Of the twenty-nine Delphi plants operating in the United States when the hedge funders began buying up control, only four remain, with not a single union production worker. Romney’s “job creators” did create jobs—in China, where Delphi now produces the parts used by GM and other major automakers here and abroad. Delphi is now incorporated overseas, leaving the company with 5,000 employees in the United States (versus almost 100,000 abroad).

Third Point’s Daniel Loeb, whose net worth of $1.3 billion owes much to his share in the Delphi windfall, told his fund’s backers this past July that Delphi remains an excellent investment because it has “virtually no North American unionized labor” and, thanks to US taxpayers, “significantly smaller pension liabilities than almost all of its peers.”

This article goes into excruciating detail about what happened with the auto bailout and Delphi retirees. It explains how the auto bailout was far from being a sweetheart deal for labor, but instead ended up being a winning lottery ticket for predatory hedge funds, which profit off of destitution and failure. It is vulture capitalism at its cruelest, and revolutions have been fought for less. 

Mitt Romney has personally – likely knowingly – profited from this particular series of events, and he and his billionaire allies are trying to expand their financial profit into political benefit. If the interests of the vulture capitalists can be married to the federal government, the sky’s the limit. It was under the Reagan Administration that growing the middle class took a back seat to tax breaks for the wealthy – trickle down, supply-side economics has been an utter disaster for middle income Americans. The notion that helping the rich would benefit everybody has been a colossal failure at satisfying those aims; the economy has thrived when the very rich were taxed more. 

So, please read this story, as it has a local effect, it’s shocking, it’s depressing, and it should make you very, very angry.  Here’s a taste: 

Mitt Romney’s opposition to the auto bailout has haunted him on the campaign trail, especially in Rust Belt states like Ohio. There, in September, the Obama campaign launched television ads blasting Romney’s November 2008New York Times op-ed, “Let Detroit Go Bankrupt.” But Romney has done a good job of concealing, until now, the fact that he and his wife, Ann, personally gained at least $15.3 million from the bailout—and a few of Romney’s most important Wall Street donors made more than $4 billion. Their gains, and the Romneys’, were astronomical—more than 3,000 percent on their investment.

and:

By the end of June 2009, with the bailout negotiations in full swing, the hedge funds, under Singer’s lead, used their bonds to buy up a controlling interest in Delphi’s stock. According to SEC filings, they paid, on average, an equivalent of only 67 cents per share.

Just two years later, in November 2011, the Singer syndicate took Delphi public at $22 a share, turning an eye-popping profit of more than 3,000 percent. Singer’s fund investors scored a gain of $904 million, all courtesy of the US taxpayer. But that’s not all. In the year since Delphi began trading publicly, its stock has soared 45 percent. Loeb’s gains so far for Third Point: $390 million. The gains for Silver Point, headed by two Goldman Sachs alums: $894 million. John Paulson’s fund, which has already sold half its holdings, has a $2.6 billion gain. And Singer’s funds and partners, combining what they’ve sold and what they hold, have $1.29 billion in profits, about forty-four times their original investment.

Yet without taking billions in taxpayer bailout funds—and slashing worker pensions—the hedge funds’ investment in Delphi would not have been worth a single dollar, according to calculations by GM and the US Treasury.

The Randian John Galt fantasy in America is just mythology. The makers and captains of industry would never withdraw from the American economy and go live in a gulch to let the moochers and takers fail. They have the system stacked in their favor; they have the most compliant government money can buy. They have successfully changed the American narrative so that a great many middle-class and working poor will happily vote against their own interests. 

I don’t think this is how America was meant to work. I don’t think that this is the sort of country the Founders envisioned – where the super-rich get richer at the direct expense of the bourgeoisie; where an idle vulture class exploits everybody with the purchased assistance of the political elite, and the whole thing goes largely unnoticed thanks to a lowest-common denominator news media. 

Our country’s founding was a revolution of the bourgeoisie, overthrowing the shackles of feudal royalty based not on political legitimacy, but on fictional divine providence. 

Disingenuous or ignorant Republican hacks can question Obama’s patriotism, birth, and faith, but truth be told, Romney’s America isn’t. 

So Many News, So Little Time

12 comments

1. What potent form of crack is WIVB smoking by hosting a second televised NY-27 debate between Chris Collins and Kathy Hochul at 10:30 pm on a weeknight? No one saw it, no one knows what happened, and I don’t get why they’d do that at all. Evidently, WNLO will re-broadcast it at 11:30 am today, so everyone who was getting ready to go to bed for work last night, will be at work and miss it today. (You can watch it here). Democracy! 

2. The other day I pointed out that Chuck Swanick is running as the candidate for homophobes. He confirmed it to Bob McCarthy, and “resumed” his campaign. From the sound of it, Swanick seems to be running in an effort to harm Grisanti, but some things I’ve read from Swanick supporters are quite negative towards Democrat Mike Amodeo, as well. It’s yet another episode of horrible people doing horrible things. I’ll add that the Conservative Party – the line on which Swanick is running – is embroiled in a dispute between its chairman Ralph Lorigo and some rank & file members to determine whether that entity will ever endorse Democrats again. Lorigo is pushing rule changes that would, e.g., ban the CP from ever again endorsing anyone with a Working Families Party endorsement. I have a better idea – let’s get rid of electoral fusion and these facile, patronage-laden cross-endorsements altogether! All these hacks would have to either find honest jobs or at least go hack it up somewhere else. 

3. While voter ID fraud is such an infinitesimally small problem that it hardly qualifies as a “problem”, it would seem as if the right-wing is busy registering voters in Virginia and then throwing some of the registration forms in a dumpster. Good luck to those new registrants trying to vote, right? 

4. Mitt Romney’s Bain Capital bought Sensata Industries in Illinois. 170 jobs will be lost in Illinois as Sensata relocates its operations to the People’s Republic of China. The people about to lose their jobs and livelihoods are protesting.  This should be a national story. 

5. Mitt Romney was caught on tape telling business owners to tell their employees how to vote. 

I hope you make it very clear to your employees what you believe is in the best interest of your enterprise and therefore their job and their future in the upcoming elections. And whether you agree with me or you agree with President Obama, or whatever your political view, I hope — I hope you pass those along to your employees. Nothing illegal about you talking to your employees about what you believe is best for the business, because I think that will figure into their election decision, their voting decision and of course doing that with your family and your kids as well.

There’s a certain egotistical pathology at play here – people come to work for work, not to be lectured about politics. Much less threatened. Some CEOs have already taken Romney up on the idea, threatening to fire everybody if they don’t vote for the candidate from Michigan/Massachusetts/Utah/California. Not to be outdone, fascist front group “Koch Industries” sent this to employees of its subsidiary Georgia Pacific: 

While we are typically told before each Presidential election that it is important and historic, I believe the upcoming election will determine what kind of America future generations will inherit.

If we elect candidates who want to spend hundreds of billions in borrowed money on costly new subsidies for a few favored cronies, put unprecedented regulatory burdens on businesses, prevent or delay important new construction projects, and excessively hinder free trade, then many of our more than 50,000 U.S. employees and contractors may suffer the consequences, including higher gasoline prices, runaway inflation, and other ills.

When you resort to threatening your employees to vote a certain way, you’ve crossed a line from free speech into intimidation. The 1st Amendment broadly protects political speech, but not threats.  Make no mistake – this is pure, unadulterated banana republic shit. 

6.  If you own any of these:

 

Then chances are you’re white, male, and over the age of 45. You think Sean Hannity is great, you hate that Bauerle tolerates gay people, and you think that Carl Paladino is God’s gift to politics. You read WND.com as either a primary or secondary news source. You stopped going to Free Republic a couple of years ago, but you think that Michelle Malkin has the right mixture of sarcasm and gravitas. Also, you completely freaked the fuck out when the country elected a black (you insist on calling him mixed-race or half-black) President in 2008. You believe that Obama wasn’t born in Hawaii, but was born in Kenya to devoted communists, and set up through a wide conspiracy – that’s taken place over 50 years – by Democrats, the SDS, Kenya, world Islam, Indonesia, the KGB, and an associated roster of communist cadres to take away the United States and replace it with a Leninist dictatorship. You self-identify as a tea party activist, but in reality you’re just a racist omniphobe who has – at least once – uttered the phrase, “keep the government out of my Medicare”. 

7. You know that funny line from the debate the other night, when President Obama explained how his administration helped ensure equal pay for women through the Lily Ledbetter Act – a law Romney would have opposed – and how Romney parried by explaining how he demanded a list of qualified women to hire for his cabinet in Massachusetts in 2002? Yeah, he didn’t ask for it. It was waiting for him when he took office. Another lie. 

8. So, as far as I can tell the right wing freakout over Benghazi has to do with what the Obama Administration said about what happened that day; whether it was a calculated terrorist act or a spontaneous thing that arose out of the protests about that idiotic anti-Mohammed “movie”. This is coming from a party that took us to war in Iraq over pretexts that changed as often as the direction of the wind? The day of the Benghazi attacks, there were protests over the movie. There were also protests over the movie in Cairo. The protest in Benghazi was around the consulate, while the Cairo protests were by the embassy. Instead of letting the government’s investigation continue, the right wing is politicizing an attack on Americans on American soil. It is a stark reminder of Obama’s speech where he said we’re one America. The Republican Party disagrees most strenuously, and their central platform since 2008 has been to disprove Obama’s assertion. 

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