Tilting at Windmills

You will not be surprised to learn that materialism is increasing. Still, you may be astonished to learn just how great its growth has been. In 1966, 42 percent of UCLA freshmen said it was essential or very important to be very well-off financially. Today, nearly three-quarters of the freshmen agree with them. And if that isnt enough to thoroughly depress you, according to another survey by the Pew Research Center reported by the Associated Press, 80 percent of 18 to 25 year olds in this country see getting rich as the top goal for their generation.

My own experience with the generation that grew up in the thirties and forties was different. None of my friends at Charleston High School talked about getting rich. Which is not to say that we lacked ambition. But it was for accomplishment and recognition. As our lives developed, only two of us earned as much as $100,000 a year: one who became head of a family company and another who happened to live in New York and be a good lawyer, which made a generous income almost inevitable. As for the rest of us, one became a clergyman, two served in the state legislature, another went to Annapolis and became an admiral. Useful lives were lived. But money was neither the aim nor the result.

I know some of you are saying, There goes Charlie again, telling us how much better his generation was than ours. But all Im trying to say is that things dont have to be the way they are now.

One of the more absurd aspects of todays materialism is its fixation on brand labels, and nowhere does that obsession strike me as more ridiculous than it does with vodka. Sales of premium brands have skyrocketed, with Grey Goose leading the pack with an annual growth rate of 50.3 percent, according to the Wall Street Journals Deborah Ball. Why do I think this is crazy? Because vodka is tasteless. Some years ago, the local city magazine, the Washingtonian, conducted a taste test of vodkas. The winner was Popov, which also happened to be the cheapest. If youre ready to give up your Grey Goose, Popov is still available, at less than a quarter of the price.

Barack Obamas announcement of his presidential candidacy in Springfield seemed largely successful, with an impressive crowd braving the nine-degree weather. But I know there was one lesson that he wanted drawn from the day that too many reporters ignored. It was that he would come to the presidency with experience in government identical to Lincolns: two years in Washington and eight years in the state legislature.

Most observers dismiss state legislature experience as irrelevant to Washington. Having been a state legislator, I know theyre wrong. The work of creating and analyzing bills followed by negotiations, persuasion, and compromise is the same. And important issues are involved in every session. Among those dealt with by Obama were tax credits for the working poor, welfare reform, early childhood education, and campaign finance reform.

On capital punishment, he took a stand that departed from conventional liberalism but displayed both courage and thoughtfulness. He does not believe that the death penalty is a deterrent to crime, but supports capital punishment in cases so heinous, so beyond the pale, that the community is justified in expressing the full measure of its outrage by meting out the ultimate punishment. Think of a heartless serial killer like Ted Bundy and youll know what Obama means.

At the same time, Obama pushed for measures to make sure that the wrong people dont get executed. His bill requiring mandatory taping of interrogations and confessions was opposed, according to the Washington Posts Peter Slevin, by prosecutors and police organizations and Governor Rod Blagojevich. Still, Obama managed to get the bill approved by the senate by fifty-eight to zero, and to persuade the governor to abandon his opposition and sign it. Not bad, not bad at all.

Republicans point to the low unemployment rate last year of 4.6 percent, and say that it is a result of the Bush tax cuts. But they forget that the rate was even lower4.0 percent in 2000under higher taxes during the Clinton administration.

Indeed, if you go back in history, prosperity and high taxes have often coexisted. In the twenty-two years since the end of World War II that unemployment has been less than 5 percent, taxes have been higher than they are now twenty-one times. In thirteen of those years, the top rate was 70 percent or higher. In nine, it was 90 percent. Thats right, unemployment less than 5 percent and a tax rate of 90 percent. Actually, in four of those years the unemployment rate was under 4 percent, the lowest it has been.

Have you noticed how some journalists, in their hunger to be on television, tailor what theyre saying to the taste of their host? Recently, Jim VandeHei, a reporter I respect, appeared on the Fox News show of the conservative John Gibson, talking about Barack Obama.

VandeHei may have forgotten that Obama has taken a more specific stance on the withdrawing of troops from Iraq than any other candidate. And on the issue of pay for teachersan issue on which the Democrats habitually sell out to the teachers unionhe has coupled a call for higher salaries with a demand that teachers be accountable for their performance.

A couple of months ago, citing a lead article in the Washington Post, we wrote about a group that seems to consider itself the new proletariatthe $100,000-to-$500,000 income groupand la causa they champion: relief from the alternative minimum tax. Now comes a lead article on the same subject in the Wall Street Journal, with the headline: Democrats Focus on Tax Relief for the Middle Class. The article identifies households with incomes with as much as $250,000, and those between $250,000 and $500,000, as the middle and upper-middle class. This ignores the fact that 80 percent of taxpayers make less than $80,000. My point in the earlier Tilting was that these people earning under $80,000 need tax relief much more than the $100,000-and-up income group, and the tax that hurts them the most is not the AMT, but the payroll tax. The way to fix it, Maya MacGuineas of the New America Foundation says, is through a tax credit designed to help the people it most adversely affects.

But my point is that all the people in the $100,000 range should stop letting their self-pity prevent them from seeing greater tax injustice, and that they stop using misleading examples to alarm the reader. The front-page story in the Post was accompanied by a chart featuring the not-exactly-typical case of a family with six children. Another chart used recently by Post columnist Ruth Marcus shows the AMT affecting income as low as $30,000, but you have to read the fine print to see that it is not about the impact of the AMT this year, but its projected effect in 2012.

I have a good many friends in the $100,000-to-$500,000 group, and I know they worry a lot about money. I sympathize with them, but they need to be reminded that their worries come from choosing to pay for private schools, own two or more nice cars, live in ever-larger houses, and pay for that Grey Goose and all the other accessories and amenities that have come to be viewed as essential. Finally, it should be remembered that in many cases all the AMT does is deprive people of the benefits of the Bush tax cuts, which most liberals agree shouldnt have been made anyway.

One of the most shameful aspects of this war is that the administrations hopes for a quick victory kept it from planning for the consequences of a longer war and the wars aftermath. The heartbreaking series in the Washington Post about the overtaxed facilities at Walter Reed Army Medical Center and the resulting failure of care is but one example. And the Bush gang is still not facing reality. The Associated Press reports that although the cost of veterans care has been rising steadily and steeply, the White Houses budget projections assume cutbacks in the cost of medical care for veterans in 2009 and 2010, and a freeze thereafter.

George W. Bush recently emerged from a meeting with the parents of soldiers killed in Iraq, telling the press: A lot of them say, Mr. President, dont let my son have died in vain. He uses their deaths as an excuse to himself and the country to keep chasing success in Iraq. I feel for Bush. He cant admit his tragic mistake in invading Iraq because he fears what these parents will think. But, Mr. President, these soldiers will not have died in vain if their sacrifice brings you to your senses, and you stop sending more men and women to die.

The Commerce Department reports, according to the Associated Press, that the nations savings rate for all of 2006 was 1 percent, the worst showing in seventy-three years. Subtract seventy-three from 2006, and we see that the previous low was in 1933at the height of the Great Depression. If that doesnt make you a bit nervous, consider that the only other year of negative savings in recent times was the 0.4 rate in 2004. And the only similar year in the past was 1932, the other worst year of the Depression.

In another clue to the shaky nature of our current prosperity, consider that the typical down payment on a home, according to Kenneth Harney of the Washington Post, traditionally has been 20 percent or more. But now, according to a survey from the National Association of Realtors, from mid-2005 to mid-2006 nearly half of all first-time buyers financed the entire transaction, obtaining mortgages in the full amount of the home price. And the median down payment for all first-time purchasers was just 2 percent. This means that as the value of the house declines, as it has in most areas in recent months, the home buyers owe more to the lender than they can sell the house for. With no savings to fall back on, whats going to happen when a job is lost or a serious illness strikes?

Chris (he doesnt want his real name to be used) started studying Arabic at Middlebury College in 2003. After the 20032004 academic year, I studied Arabic at a very intense level at the Middlebury College Summer Language School, he tells John McCaslin of the Washington Times. I then spent the entire 20042005 academic year studying at the American University in Cairo. There, Chris took five Arabic language courses. He then spent the summer of 2006 in Yemen studying Arabic on a State Department fellowship, and now is a highly regarded employee of the Peace Corps. He also had applied to the National Security Agency, the FBI, the Defense Intelligence Agency, and the CIA. I never heard back from any of these agencies, he says, adding that none of the other seventeen students on State Department fellowships in Yemen were subsequently contacted by the State Department.

Buried in a long Washington Post story about the merger of the XM and Sirius satellite radio stations was the most succinct explanation of how Washington really works that Ive encountered: To help the proposed Sirius-XM merger at the FCC, Sirius has hired the communications law firm Wiley Rein. Managing partner Richard E. Wiley is a former FCC chairman. [Kevin] Martin, the FCC chairman, is a former associate of the firm.

In a related story by the Washington Posts Jeffrey Birnbaum, we learn that the new chief of staff of the House Energy and Commerce Committee is Dennis B. Fitzgibbons, who was a lobbyist for DaimlerChrysler. In that role, he was generously compensated to oppose laws requiring cars to use alternative fuels and be more energy efficient. Now he has the most important staff job on the committee that, as Birnbaum puts it, is charged with deciding whether automakers should be compelled to do either of those things.

Conflict of interest is not as black and white an issue as many journalists seem to think. Those who consider it a simple matter should recall Michael Kinsleys question: Is it a conflict of interest for a mother to have a second child?

Still, cases like Fitzgibbons should arouse suspicion. And while we should not leap to the assumption that he will continue to do the bidding of his former employers, it is prudent to keep a watchful eye on his performance. Such scrutiny might just help keep him on the straight and narrow.

Another story that arouses suspicion comes from the Posts Elizabeth Williamson, who reports: Days after Jennifer Esposito became majority staff director of the House transportation panels subcommittee on railroads, her father, Sante Esposito, and brother Michael Esposito signed up as railway lobbyists. Which is not only suspicious, it comes perilously close to being, in the immortal words of George Tenet, a slam dunk. It also illustrates at least one hole in the new House ethics rules.

Another possible hole in those rules was revealed by the Wall Street Journals Jeanne Cummings, writing about the lobbyist Heather Podesta. For Washington Senator Maria Cantwell, Ms. Podesta flew in four female chefs to prepare one course each for a fund-raiser. For Senator Debbie Stabenow, she had Alice Waters, founder of Californias Chez Panisse, prepare meals at an event. It seems odd that the rules that now keep Podesta from picking up the dinner check for Cantwell or Stabenow would still allow her to pay the transportation costs, expenses, and fees for these chefs.

Soldiers Death Strengthens Senators Anti-war Resolve, by the Washington Posts Jonathan Weisman and Ann Scott Tyson, tells a touching story about how John Kerry and Chris Dodd were affected by the death of a soldier they had gotten to know on a visit to Iraq. It has radicalized Dodd and energized Kerry in their opposition to the war.

Is it not possible that more senators and congressmen would have opposed the war, and done so with greater vigor, if they too had known soldiers? Thats why I support a draft that takes people from all classes and educational backgrounds. When we enacted such a draft in 1940, we did not leap to war. Far from it. It was not until Japan attacked us and Hitler declared war against us that we declared war against them. And we did not escalate in Vietnam until Lyndon Johnson and General Lewis Hershey had fixed the draft to exclude the privileged. A truly democratic draft would be our greatest protection against another Iraq.

I understand why some Democrats have become automatically anti anything that Bush proposes. After all, hes been wrong so often. But I urge them to take a serious look at a couple of the administrations recent proposals. One, by Bushs secretary of agriculture, Mike Johanns, would end farm subsidies for around 80,000 wealthy farmers who definitely do not need federal assistance. The other, on health insurance, actually has a Robin Hood element that should appeal to Democrats. It will, in effect, tax the richer recipients of health insurance to finance tax breaks to help the less affluent get insured. Of course, universal health care should be our goal. But Bushs proposal may be close to the best deal we can get now.

If youre worried about those no-down-payment mortgages, you will not be comforted to know that a rapidly increasing number of mortgages are in default. Called sub-prime, these mortgages have often been issued on the basis of little evidence of the home owners credit-worthiness. To compound the problem, many mortgages, and not just those of the sub-prime variety, require payment on the interest only in the early years, meaning that home owners are in for a major shock when payments on the principal begin to be required. Many mortgages issued in 2005 and 2006 are defaulting at high velocity, according to the New York Times Gretchen Morgenson, who wonders whats going to happen to all the mortgage-backed securities held by pension funds, hedge funds, banks, and insurance companies. In just one example cited by Newsweeks Robert Samuelson in the Washington Post, HSBCa major bank holding companyannounced more than $10 billion in losses on sub-prime mortgages. Sleep tight.

Remember Kyle Dusty Foggo, the former number three man at the CIA? His name came up in a less than flattering context during the emergence of the Duke Cunningham scandal. Now the suspicions aroused back then have taken a significant step toward confirmation. Dusty, in an eleven-count indictment by a federal grand jury, has been accused of accepting lavish vacations, helicopter rides, and private jet flights from [Brent] Wilkes, who, under an accompanying indictment, is charged with conspiracy, bribery, money laundering, and unlawful monetary transactions to Cunningham in return for government contracts, according to Jerry Seper of the Washington Times. Apparently the grand jury concluded that there was a relationship between such largesse as the $32,000 Wilkes paid for Mr. Foggo to join him on a vacation to Hawaii [and] the award of a $2.4 million contract for Mr. Wilkes firm to provide water, first aid supplies and household items to CIA agents operating in war zones, including Afghanistan and Iraq.

Dusty, you will recall, seems to have gotten his job because former CIA Director Porter Goss was impressed by his skill at planning trips. This reminds me of how Michael Brown was hired on the basis of his experience running horse shows. You have to be impressed by the ability of Bush administration personnel recruiters to think outside the box. Not everyone would have seen the International Arabian Horse Association and the American Society of Travel Agents as the most logical places to look for senior government executives.

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Charles Peters

Charles Peters is the founding editor of the Washington Monthly.