Paul Soglin: Waxing America

Paying for Good Behavior Fails, As Expected

Several years ago new York City leaders tried an experimental program to pay look income families for good behavior. It failed.

City Will Stop Paying the Poor for Good Behavior

The three-year-old pilot project, the first of its kind in the country, gave parents payments for things like going to the dentist ($100) or holding down a full-time job ($150 per month). Children were rewarded for attending school regularly ($25 to $50 per month) or passing a high school Regents exam ($600).

The program was flawed from the beginning. As most employers know, while people work for financial reward, the real motivator for success comes from within and is the result of pride.

Secondly continuous improvement is the result of system changes, not one time 'quick fixes.'

Every individual needs to develop their soft as well as their hard skills. Improving soft skills is a lifetime achievement, they are not developed by showing up for a dental appointment and getting $100.

 

 

The State of the State of Wisconsin and the United States

The right-wing chatter boxes continue to provide flawed analysis about the national and Wisconsin economy.

They ignore the fact that the U.S. economy was permanently and critically altered by NAFTA and other trade agreements that allowed $2.00 a day workers to replace American workers. They miss the point that a nation cannot engage in two wars at a cost of billions of dollars a week which do little to contribute to the productivity of the country.

When we look at the depth and breath of this depression, the worst economic crisis facing the nation since the 1930's, it is beyond fascination to see these extremists demanding the economy they destroyed be repaired in a year.

It took five years to come out of the Great Depression. That depression saw an expansion of jobs as the advent of World War II and American industrial might combined to right the greatest economy in the world.

The Republican banking crisis, the trade agreements pushed by the right and accepted by some Democrats, will take more than 12 or 18 months to fix.

It is time we come to recognize that 20% unemployment was avoided, that the majority of troubled financial institutions are now above water, and that depression did not cut deeper.

Growing Poverty in Madison Part II and Tim Cooley

In yesterday's post Growing Poverty in Madison Part I, I noted that to further soclal justice a municipality needs revenues.  Unfortunately, too many leaders, in and out of government, either fail to acknowledge that money, that is tax dollars, needs to be raised, or they address the problem by talking a good game but failing to fund the required investment in human capacity.

Yesterday, while I was posting about poverty, long time buddy at The Capital TImes, Dave Zweifel, knocked my socks off praising Tim Cooley. Questioning city’s process is a good thing

Frankly, although I disagree with some of his views, I find Tim Cooley to be a breath of fresh air. He was appointed economic development director by Mayor Dave Cieslewicz last January in an effort to assist businesses and developers to navigate the sometimes mysterious paths through city hall and, hopefully, attract new companies to locate here.

One public official who gets it is Tim Cooley. Cooley flatly states that to fund Madison's community programs a tax base is required - that means competitively attracting investment into Madison, not its suburbs.

Cooley was featured in a Wisconsin State Journal article last week, City's economic development director rattles cages in push for change

Since taking the $107,673 a year job, Cooley's pushed to make Madison more competitive, questioned the city's rigorous approval process and moved to loosen rules on public aid for businesses. He's mused about installing a city manager-style of government and downsizing the council, likened the use of Tax Incremental Financing (TIF) to playing poker, and offered radically different ideas for the redevelopment of the Edgewater hotel and neighboring property.

I may disagree with Cooley on the need for a city manager, but he is certainly in step with my feelings regarding the need to economically expand Madison. That is why I found it curious that some said,

"But he doesn't understand Madison's culture. He's not making an effort to balance what makes Madison special with economic development.”

What part of Madison culture does he not understand? That we are soft-spoken? That we resist new ideas? 

Perhaps growing up on Madison's east side and graduating from East High School is the problem. That certainly makes him the exception rather than the rule in this town, where outsiders have held sway over government for forty years. Mea culpa.

Cooley is one of the few people who not only knows the balance but is prepared to make it work.

If this city wants to combat poverty it had better understand what Cooley is saying about the need to make Madison competitive with the rest of Dane County. Epic Systems Corporation is in Verona because of attitude as much as TIF policy. It should sicken every Madisonian to see that Madison-born company building a billion dollar campus fifteen miles from where it was founded and spent its first twenty years.

Imagine what those property tax revenues would do to combat poverty.

Growing Poverty In Madison - Part I

Last week Mike Ivey of The Capital Times reported Poor flock to city of Madison, not the 'burbs'

(nationally)....The number of poor grew by 25 percent in suburbs from 2000 to 2008-almost five times the growth rate in primary cities-making the suburbs home to the largest and fastest growing poor population in the country.

But the Madison metropolitan area bucked the trend. The poverty rate showed a significant increase in the city and no change in the suburbs over this time period.

The Brookings Institute report "The Suburbanization of Poverty: Trends in Metropolitan America, 2000 to 2008" only goes back to 2000, but this is a trend that began in the early 1980's, as poorer urban families searched for better homes, first in small to medium size cities like Madison, Albany and Harrisburg, PA, as well as the suburbs. The Promised Land, published in 1992, tells the story of black migration in America since the 1940's.

Their goal was not much different than that of their fellow middle and upper income migrants - seeking neighborhoods with employment, good schools and safe streets.

With this pattern of migration came problems. Many communities were unprepared for the increase in poverty. Housing designed for young 27 year old professionals could not accommodate the needs of low income families with children. School systems with limited budgets were challenged to educate kids with little or no pre-school guidance. Housing, counseling, and family enhancement programs were short staffed and underfunded.

Frankly, when you look at the challenge, it is surprising that Madison has done as well as it has. TThe challenge is that political ideology, ignorance, and funding issues all contribute to the problem:

• Liberals refuse to acknowledge that gangsters, extortionists, and drug dealers follow the impoverished families to Madison and a law enforcement response is required.
• Conservatives refuse to acknowledge that law enforcement is just one tool in combating crime and that without programming that empowers families, crime will prevail no matter how many police officers are sent to a neighborhood.
• Housing advocates refuse to acknowledge that no one is helped by continually adding to the supply of more low income housing if employment, child care, transportation, health care, and family enhancement programs are not developed at a comparable rate as the housing stock.
• The employment, child care, transportation, health care, and family enhancement programs are not effective if understaffed, poorly funded and uncoordinated.
• No matter how sincere the commitment, none of this works without government revenues and private sector participation. That means a tax base of businesses, particularly office buildings and retail, must be continually developed to provide the resources to fund effective programming.

Representative Ryan: 900 Words of Silence

Wisconsin Representative Paul Ryan (WI-Janesville) on the pages of TheJournalTimes.com tells us about Inflation's Looming Shadow.

In this profoundly vapid, scholarly appearing article, Ryan uses charts and references to ominous sources to warn about looming inflation:

 One of my key concerns is on the inflation front...If inflation gets out of hand, the Fed will be forced to hike interest rates and we could end up with the worst possible combination: rising prices, high interest rates, high unemployment and weak growth, or stagflation.

So what else is new? Every economist and first year business major warned us of the specter of inflation when the first solutions to the Bush-Ryan depression loomed 18 months ago. 

Curiously Ryan's article is more noticeable for what he does not say:

• War contributes to inflation. As with Vietnam, when you spend hundreds of billions of dollars in Iraq for a military conflict, when those dollars are not used to produce values, housing, roads, educated children, hospital, inflation grows. Given the Bush-Ryan War in Iraq, we might as well tax the public and burn the money.
• Ryan was a principal leader in the effort to deregulate the financial services industry, an action that led to this economic crisis and the outrageous bonuses paid to Wall Street for no productive work, another source of inflation.
• Ryan was a principal leader in spending hundreds of billions of dollars to bail out companies run into the ground by his political contributors. He tells us that this bailout fuels inflation. He is silent as to his own role.
• Jobs were lost all right. They were lost to unregulated, rampant subsidies for American businesses to cease production and import products manufactured overseas by slave labor and under devastating environmental conditions at the expense of Ryan's union constituents. All orchestrated and paid for by Ryan's buddies.
• Ryan said nothing in 2008 when his buddies, the speculators, manipulated the price of oil, sending it from $65 a barrel to over $150 in three short months. Now that is inflationary.

Phooey.

Ryan is only interested in setting up a straw man so that when the inflation creeps into the economy he can say "I told you so," rationalize more cuts to government services, and deflect criticism of his own role in ruining the nation's economy.
 

Becky Young: Mom, Lawyer, Legislator, Educator, Friend, Environmentalist

Becky Young never asked for anything in return.

She simply did the right thing.  Rather than worry about the political consequences or the political payback, she asked nothing more than you do the same.

Whether it was transportation planning or children, family enhancement or university expansion, she demonstrated real leadership. She engaged citizens and colleagues, with purpose, because the reward was the successful program or plan, not personal aggrandizement.

She came from what I call the 'Tom Sawyer' school of management. She got everyone to paint the fence, though unlike Tom, she never sat by idly; she was a full participant.

Eloquently, George Hesselberg in the Wisconsin State Journal, best described her, Rebecca Young, pillar of Madison politics, dies at 74

Rebecca Young, an approachable icon of congenial modesty and achievement for 30 years in Madison's political landscape, a steady and informed advocate with a welcoming ear for issues involving women, children, transit and the environment, died Tuesday at home of cancer at the age of 74.

She took buses, raised four daughters with her husband, Crawford Young, and kept a breathtaking schedule from the moment she arrived in 1963, starting with the League of Women Voters. She ran for election 12 times, winning every time, including County Board, School Board and seven terms in the state Assembly.

She moved up the political ladder, in stature and influence, never plotting her next step. The only course she followed was her political compass heading towards a better life for kids.

There is a lesson in there somewhere.

 

Economic Disaster That A Fool Could Forecast

Like most states, we are caught up in the cruel torture of national policies that are driven by greed, imperialism, and stupidity. Readrers of Waxing America will recall that in the spring of 2007 I forecasted a stock market crash and repeated it last January, Another War; Another Recession. Whatdidyah Expect?

Last  spring I used my limited abilities in forecasting the economy and predicted a stock market crash... For the second time in my lifetime a stupid, foolish war built on lies not only wrecked havoc with another country but it is destroying the American economy.

It does not take a rocket scientist to get it right... Go on take 10% of your income and set it on fire, throw it down the toilet, or just rip it up. And just for good measure, borrow a lot of money and rip it up too.

It is so simple. You cannot destroy your resources and your assets. Imagine the homes and schools that might have been built. Billions of dollars - now that is stimulation for the economy.

I am not a genius in these matters; it is that I am not driven by blind ideology in arriving at conclusions about the ecomony. A few years experience in the public and private sectors, an understanding of history and a willingness to distance myself from bad public planning, or lack of planning, no matter how politically popular the proposal, do help.

As the fall elections approach, candidates for the Wisconsin legislature and Congress from both political parties will warm your frontal lobes with cuddly promises of 'no tax increases,' cutting fat from the budget, and reducing spending.

If you are attracted to those soft sweet sounds, complete the job and instead of voting, just get a lobotomy.

If you want a candidate who will  provide a lump of coal to warm you in your decrepit retirement, and a dull knife so you can remove your spouse's appendix by candlelight in your toothless waning years, I suggest looking for the following promises:

• A pledge to the business community to provide an educated, trained workforce, not lower taxes.
• A pledge to increase spending on education from kindergarten through the University of Wisconsin and Voc-Tech Systems.
• A commitment to spend money on infrastructure that places a priority on the environment, health, and safety.
• A commitment to regulate where appropriate and needed.
• That infratstructure will be funded through borrowing as should any reasonable capital budget item.
• The operating budget, unlike the capital budget, will be funded by general purpose revenues, and only general purpose revenues. No borrowing here.
• It will be necessary to increase taxes. The increase will be progressive and will fall on wealthier taxpayers.
• A commitment to regulate where required for health and safety.
• A declaration that international trade which exports great jobs and imports poisonous pet food and baby formula is not working.
• There will be no reductions of state revenue payments to local units of government. These reductions only end up with increase in the property tax which has the impact of shifting taxes from the wealthy to the middle class.
• On the national level there will be increases in the income tax- progressive increases.
• If we fight a war, there will be honest talk. It is impossible to have guns and butter. If we fight a war there must be sacrifices at home as well as on the battlefield.
• If the candidate tells you they are highly regarded by Wisconsin Manufacturers and Commerce (WMC), tell that candidate to move to Alaska.

 

 

It does not take a rocket scientist to get it right... Go on take 10% of your income and set it on fire, throw it down the toilet, or just rip it up. And just for good measure, borrow a lot of money and rip it up too.

It is so simple. You cannot destroy your resources and your assets. Imagine the homes and schools that might have been built. Billions of dollars - now that is stimulation for the economy.

Solving the Financial Crisis. A Modest Proposal

As much as it disgusts me, the bailout of the financial institutions run by greedy, egotistical managers and executives presents a less devastating result than letting them go under.

Ten years from now, my family, my friends, the working people who make this country great and ask for nothing more than a fair shake, will be better off with a properly structured loan to an industry run amuck.

Before we get into the details, the first thing we must understand is that bailout or not, the Republican Party, the author of this ideological meltdown, is responsible for the biggest tax hike and the biggest waste of taxpayers dollars in history.

For a bailout to work:

• There must be a return to Glass-Steagall, the Depression-era body of law that provided safeguards against these excesses.
• No foreign banks deserve one cent of American money. If their respective nations wish to save them, they can bail them out. They already made enough money in the past decade.
• A special investigator should be appointed to look into the relationship of banking lobbyists and the principals responsible for this former disaster, special financial guru to John McCain, former Texas Senator Phil Gramm, and hit man Newt Gingrich, who thinks the solution to this problem is eliminating the capital gains tax.
• Any borrower should be allowed to extend their home loan one month for each year left on the mortgage and those deferred payments should have a maximum interest rate of 3%.
• No executive of a bailed-out company shall be compensated more than $1 million annually, and that will include company cars, homes, boats, contributions to retirement plans and life insurance. Life insurance can be taken out on the executive if the United States government is the beneficiary until the institution's loans are paid off. Frankly I am being too generous, but I cannot stand to see pirates cry.
• Labor, real work that contributes to the growth of the economy has to be recognized as being more honorable, more noble, and more essential, than flim-flam paper exercises that are nothing more than speculation in industries that are exporting jobs to countries where workers are paid less than $5 a day.
• For every million dollars a financial institution receives, they must repay the entire amount at an interest rate of 3.75%.  All loans must be repaid within a decade.

  
   

Who Is Responsible for the Economic and Financial Crisis?

The present crisis is the culmination of a series of events that go back to the election of Ronald Reagan as President and flowed through the subsequent years as the right wing mastered modern day communications, particularly cable TV.

The pinnacle was in 1999 with the repeal of Glass-Steagall, the Depression Era legislation that brought regulation and some degree of consumer protection to the financial marketplace. The public would not be wandering the dark hall of manipulators, oil speculators, and other creeps who took the art of capital formation to a new low, making money by pushing paper and never creating anything of value.

The Reagan Administration gutted regulation administratively in key areas of commerce and finance and was followed by the Republican control of the Congress and the ascendancy of Newt Gingrich, culminating in the adoption of the Financial Modernization Act of 1999.

This piece of legislation was drafted in 1998, and over the next year the Republicans overcame all opposition. To understand what happened it is necessary to examine the legislative process and the political climate of the time.

The Republicans were dominant and the Democrats were on the run. Fearful of losing more Congressional representation, the Democrats often capitulated, fearful if they stood up to  Gingrich, they too would lose their next election.

True Believers:   Lead by the bill's principal author, Phil Graham, this group were cronies of the oil interests and the speculators. It included reactionaries from Gingrich to Grover Norquist.

The Supporters:  These were all of the Republicans and one Democrat in the Senate accompanied by a similar alignment in the House of Representatives, though there were more blue-dog Democrats who joined the GOP. The critical vote came when the Senate version of the bill was adopted.

On  May 6,1999, the Senate adopted its version of the bill on a vote of 54-44.  Supporting that bill was John McCain; in opposition were all Democrats except Hollings of South Carolina. Joe Biden wisely voted 'no.'

For a more detailed explanation see this post, The crisis is so bad the financial press turns bolshie, February 17, 2008.

After the House vote, the bill went to conference committee.

The Negotiators. In conference committee, negotiators  from both Houses of Congress worked out their differences. President Clinton got involved realizing that with final passage there would be a veto proof majority. The final version of the bill was adopted by the Senate in November by 90-8. Joe Biden again voted 'No.'

John McCain, in the most blatant example of cowardice, refused to vote for or against the bill. He voted 'present.'

 

For more detail: John McCain's lying is contagious

 

 

 

 

 

Is it the water or the air in Milwaukee?

It could be Milwaukee's air, or the water, or both.  Last week I posted  What Do We Do About the Parents - Incarceration- Especially Blacks, leading with 

Every time we hear right wing analysis about societal problems, whether it comes from Mark Belling or his protege, Charlie Sykes, the rant is about the parents. The not so unsubtle message is that drug addled, unwed inner city residents, authority dissin' and probably black, are incapable of rearing their children.

Then, before the Internet ink was barely dry, Rick Esenberg was in my face with "Inconvenient Truths?" leading with:

Paul Soglin is upset with right wingers for blaming poor educational results in MPS on the "parents."

Before going any further, would someone, anyone, show Rick where there is a reference to the Milwaukee Public Schools (MPS). I did mention the Madison Metropolitan School District (MMSD), but not Milwaukee.

But Rick's errant missive does not end with the first paragraph. Writing in paragraph three, the legal scholar observes,

It doesn't seem to be a simple function of racism and poverty and the absence of social programs because the degree of dysfunction has increased as both have decreased.

Rick, go to MPS and get a graph of the number of children in households where they are eligible for the free lunch program. Kids in the free lunch program is a good measurement of poverty in a school district. Compare that over the past twnety years and then come back and we can continue the conversation.

Just for the record, kids in the free lunch program in Madison have increased from 20% in the late 1980's, to 26% in the mid 1990's, to over 48% presently.  Of course most of that is because of the migration of families to the Madison area from other Midwestern cities, including Milwaukee. What is amazing about Madison is that despite this significant increase in poverty, academic standards have not  been severely impacted.

Much of the success is the result of the kind of programming that goes beyond direct education of the kids. It impacts the family, it enhances the family, and it set neighborhood standards that even Rick admires. Unfortunately, even Madison is in danger as budget cuts jeopardize many of these programs.

But so long as Rick and his compatriots blame the parents without any recognized programs to break the cycle, Milwaukee will be fighting a desperate losing battle.

Rick gets one thing right. It is something I suggested to him last year as being part of the problem.

Is it the abandonment of poor neighborhoods by the black middle class?

Yes, middle class blacks left the city just as their white middle class counterparts had done years before. So that is part of the problem, but only part of it. There were other institutions and structures available years ago that are no longer effective against poverty and crime.

There are ways to fix the problem. Blaming the parents and leaving it at that is no solution. Frankly, I don't think everyone praying cuts it either.

Rick, racism for middle class blacks may be on the decline, but I am not so sure that poor black families felt any signicant improvement in the past decade.