Today I was chatting with a friend who has recently attained the age of sixty—when he planned to retire. Like tens of thousands of others, he has revised those plans. He’s not bitter—he enjoys what he does and, for him, retirement day is still in sight.
He did everything right. He paid off his house; he will have pensions from two different careers. It’s the investments—the ones he was planning to live on until Social Security and the pensions all kicked in—that are stopping him. He suggested it was like watching water draining from a tub over the past year.
“But,” he said to me, “I have one question I’d like to figure out the answer to. When the stock market falls several hundred points and they tell me a trillion dollars is lost, where did that money actually go?
“I mean,” he said, “if I have two apples and you take one away from me, I’ve clearly lost an apple—but I know exactly where it went. But where did half the value of my stocks GO? That’s what I want to know. Where does this lost money disappear to?”
I thought about it for awhile. It does seem to defy basic laws of physics to have vast quantities of cash (even if it is all electronic—just little blips on a computer chip) disappear from the known universe without a trace. There should, according to physics, be at least some residue—or some bottom feeder over in Asia who now has that trillion. But, no, it’s gone. Poof.
Those who deny the possibility of creation ex nihilo (from nothing) insist that I believe in demolition ad nihilo (to nothing). I jokingly suggested that perhaps my friend hadn’t watched enough science fiction; that there is a little gnome-like Yoda who waves both hands and things just disembody themselves right out of this universe. Blame Wall Street’s problems on the Force, of course.
Then I raised a second, more thought provoking question, perhaps the right thing to ask is not where did it go when it disappeared but did it ever really exist? This is far more philosophical than brokers and financiers ever care to get, but when we talk about a company’s market cap reaching so many billions, is all of that money real?
If it can disappear at the flick of a switch, was it ever really there? One really doesn’t want to think of the stock exchange as being some kind of magician’s cabinet with false sides and mirrors; when his assistant vanishes we know it’s a trick. What about the trillion that vanishes? Is that a trick too?
It’s not all that reassuring—as far as investing in the market goes—to make oneself accept that it is all because so many people stopped selling and buying product, and that companies spent through cash reserves to meet payroll and pay for raw materials until nothing was left (not even credit)—and that’s really why a company with a market cap of billions last year now sells like a penny stock.
The fellow left holding the hideously shrunken IRA is still left vaguely wondering where did the trillion (and my retirement) really go? (Dear Lord, imagine if they had managed to put Social Security into the market like they wanted to do! There are people for whom Social Security is all that is left in this ruin.)
BusinessWeek (12/15 issue) ran an article called “The Hidden Pension Threat”. Pension portfolios have been hit as hard as anyone else. A company whose pension was fully funded a year ago suddenly finds itself underfunded by millions upon millions due to the collapse in stock values.
This happens just as the 2006 Pension Protection Act kicks in with its requirement that pension plans must have enough funds on hand to cover present AND FUTURE obligations. The suddenly cash strapped companies (whose products have stopped selling) must now come up millions in cash to cover the Wall Street shortfall that hammered its pension plan.
Guess where that leads? The quickest way for any company to improve cash flow is to lay off bodies. And what, do you suppose, more layoffs will do for the stock market and retirees IRAs?
Just how much confidence do people have on future prospects on Main Street or Wall Street? On National Public Radio I heard a brief note this morning: For the first time ever the Government is issuing treasuries with a Zero interest rate. In other words, Uncle Sam will hold your money for you and give you back exactly what you put in. No interest, no income. People are desperate enough to buy these.
The horrifying thing about this situation is that it is not just that some arcane law of physics no longer applies—all those things Barron’s, the Wall Street Journal, and the financial advisors told us to do no longer apply.
Invest prudently – and you can be just as broke as the guy who didn’t invest at all. Revise the old clause in the will, “Being of sane and sound mind, I spent every penny before I died”. Have it read, “Being of sane and sound mind, I spent it all while it still had some value.”
Wednesday, December 10, 2008
Tuesday, December 9, 2008
Half Off At The Mall
Last night I drove down to a mall. (I hate malls. Always enjoyed walking down Fifth Avenue, Rodeo Drive or downtown Grand Rapids when I was a kid. Going store to store on an actual street seemed an adventure to me. Malls take the art of the artificial to a transcendent level.) But I did.
I was looking for a new pair of boots. (My old faithful pair has given up after twelve or more years.) The thing I noticed about walking into one store after another is how empty of shoppers they were. And, a full two weeks before Christmas, the desperate nature of the pricing.
Gift wrapping paper was 55% off—and, boy, was there lots of it! Rack after rack of clothing was advertised at 50% off. If that’s a true markdown, we’re talking about selling stuff at cost two weeks before the holiday.
Some racks were only 40% off; a few said 25%. But everything was marked down. The boots I finally bought were priced at $80 and I bought them for $35. For years and years, that wouldn’t have been true until the week after Christmas—if there were any left.
How much better could the sales on Black Friday possibly have been?
It seems to me we have been climbing this mountain toward bigger and more inclusive malls since some time in the 1950s. I remember they opened the first mall in Grand Rapids late that decade. I saw my first mall in suburban Detroit in 1954. It was considered quite a phenomenon at the time.
Back in that ancient time, “downtown” had a meaning. I’m not a big shopper—most men aren’t—but there was something truly enjoyable about traipsing up Monroe Avenue, going in and out of standalone stores, just looking.
There was a Planter’s Peanut store across the street from the old Pantlind Hotel (now the Amway Grand Plaza—but they’ll still let you walk from today’s glass and steel entrance back into the elegant 1913 lobby no longer used). To begin my shopping day, I’d buy a huge bag of hot, roasted red peanuts, half a pound for 50 cents, and munch my way up the Avenue for some serious shopping. That became my private Christmas ritual.
In the space of six or eight blocks there were three locally owned department stores, a Sears and a JC Penney store—plus a raft of smaller, independent stores. (My mother had a relationship with the hat buyer at Jacobsen’s—when a new shipment of hats came in, she’d set aside a few that my mom would like and give her a call.
I had a similar relationship with a small men’s store in New York once. My friend could buy my Christmas present by going in and asking Charlie what would go with my wardrobe.) I miss having the same stores there, year after year—greeting them like old friends.
Stores weren’t open each and every night. As a concession, they were open Monday nights only. Sales stayed where they belonged, after the holidays. As you entered a store, there were real Christmas carols playing—not the secular holiday tunes of today.
On the occasion when you can force me into a mall, like last night, I look at the row on row of characterless “shops” with their entire fronts open to the mall concourse. Dress shop after dress shop; shoe shop after shoe shop; none with anything to distinguish them. I wonder if there really is a dress shop for every three women in the United States? Can we afford them all?
Will this finally be the year when we weed out some of those “boutique” shops? Will we lose some of the department stores (with much less variety than the real ones used to have—the ones the malls drove out business) that seem to spring up like dandelions?
Fifty and forty and fifty-five percent off weeks before Christmas seems to give hope for that to happen. Maybe in some of the empty spaces they’ll bring back my old Planter’s store—with its hobbit sized peanut man beating out a tattoo on a fifty cent piece taped to the glass front window (a proper store ought to have a glass front windows). You could hear the tapping a block or two away.
It’s really not Christmas without it. Perhaps the economic reality that seems to be descending upon us will bring back something about shopping that I really enjoyed. Tap tap, tap tap, tap tap … . And a Merrie Christmas to us all—at 50% off.
I was looking for a new pair of boots. (My old faithful pair has given up after twelve or more years.) The thing I noticed about walking into one store after another is how empty of shoppers they were. And, a full two weeks before Christmas, the desperate nature of the pricing.
Gift wrapping paper was 55% off—and, boy, was there lots of it! Rack after rack of clothing was advertised at 50% off. If that’s a true markdown, we’re talking about selling stuff at cost two weeks before the holiday.
Some racks were only 40% off; a few said 25%. But everything was marked down. The boots I finally bought were priced at $80 and I bought them for $35. For years and years, that wouldn’t have been true until the week after Christmas—if there were any left.
How much better could the sales on Black Friday possibly have been?
It seems to me we have been climbing this mountain toward bigger and more inclusive malls since some time in the 1950s. I remember they opened the first mall in Grand Rapids late that decade. I saw my first mall in suburban Detroit in 1954. It was considered quite a phenomenon at the time.
Back in that ancient time, “downtown” had a meaning. I’m not a big shopper—most men aren’t—but there was something truly enjoyable about traipsing up Monroe Avenue, going in and out of standalone stores, just looking.
There was a Planter’s Peanut store across the street from the old Pantlind Hotel (now the Amway Grand Plaza—but they’ll still let you walk from today’s glass and steel entrance back into the elegant 1913 lobby no longer used). To begin my shopping day, I’d buy a huge bag of hot, roasted red peanuts, half a pound for 50 cents, and munch my way up the Avenue for some serious shopping. That became my private Christmas ritual.
In the space of six or eight blocks there were three locally owned department stores, a Sears and a JC Penney store—plus a raft of smaller, independent stores. (My mother had a relationship with the hat buyer at Jacobsen’s—when a new shipment of hats came in, she’d set aside a few that my mom would like and give her a call.
I had a similar relationship with a small men’s store in New York once. My friend could buy my Christmas present by going in and asking Charlie what would go with my wardrobe.) I miss having the same stores there, year after year—greeting them like old friends.
Stores weren’t open each and every night. As a concession, they were open Monday nights only. Sales stayed where they belonged, after the holidays. As you entered a store, there were real Christmas carols playing—not the secular holiday tunes of today.
On the occasion when you can force me into a mall, like last night, I look at the row on row of characterless “shops” with their entire fronts open to the mall concourse. Dress shop after dress shop; shoe shop after shoe shop; none with anything to distinguish them. I wonder if there really is a dress shop for every three women in the United States? Can we afford them all?
Will this finally be the year when we weed out some of those “boutique” shops? Will we lose some of the department stores (with much less variety than the real ones used to have—the ones the malls drove out business) that seem to spring up like dandelions?
Fifty and forty and fifty-five percent off weeks before Christmas seems to give hope for that to happen. Maybe in some of the empty spaces they’ll bring back my old Planter’s store—with its hobbit sized peanut man beating out a tattoo on a fifty cent piece taped to the glass front window (a proper store ought to have a glass front windows). You could hear the tapping a block or two away.
It’s really not Christmas without it. Perhaps the economic reality that seems to be descending upon us will bring back something about shopping that I really enjoyed. Tap tap, tap tap, tap tap … . And a Merrie Christmas to us all—at 50% off.
Monday, December 8, 2008
Lessons from British Foreign Policy
When I wrote that American foreign policy since 1607 has been simply a copy or remake of British foreign policy, I deliberately left out one significant aspect of Anglo-British policy. That was English policy toward the continent of Europe during most of the Nineteenth Century.
After 1815, England stood offshore from the continent, played balance of power politics with a nudge here or a threat there, and avoided participation in any European shooting war from 1815 to 1914—with one small exception when she was asked to participate in an anti-Russian coalition in the Crimea.
Contrast this to the Eighteenth Century in which British troops fought major battles on the continent in four world-wide wars. In the Nineteenth, she left Europe alone as long as her sea power was unchallenged.
She stood aloof as mortal enemy, France, went from Monarchy to Republic to Empire to Republic. She insisted on the Tripartite Treaty of 1830 when the United Netherlands split into two ineffectual parts but did nothing more. She stood idle as nearly every government in western and central Europe collapsed in revolutionary convulsions in 1848.
She did nothing as a series of German wars eliminated Austria as a Major Power, humiliated France and created a dangerously powerful united Germany. She stayed out of the Russo-Turkish War in 1878, only participating in the Congress of Berlin that year.
She watched, she put a thumb on the scale here or there, but she did nothing military. It worked because she had unchallenged control of the seas—all over the globe. When Spain, Russia, Austria, France and Prussia wanted to invade the United States in 1820, they couldn’t move without the approval of the British fleet—which never came.
When France wanted to fight Russia over the Holy Places in Turkish Jerusalem, not an army could move unless transported by the British navy. France and Spain could not invade Mexico in 1862 without the concurrence of Britain. All three went in together.
Few Americans are aware of how close the United States came to destruction in 1861-2. It was not the prowess of Robert E. Lee, but the threat of British naval intervention on behalf of the Confederacy that could have ended our existence. Only the dying Prince Albert, propped up in bed, saved us.
In other words, in the words of an American naval captain and author, Albert Thayer Mann, sea power was the key. Sea power was supreme. From Napoleon to the Kaiser there were no world wars—because sea power prevented them. (At some point someone has to say something about Rothschild financial power which certainly prevented wars in the early 19th Century, but the real teeth lay with the British navy.)
With all of our concentration on top-of-the line land vehicles and army special forces, Americans have possibly forgotten Thayer’s point. The British army during the Pax Britannica was tiny. It was good for colonial wars, period.
It might truly be said that if we continue to rule the waves, what happens on the land masses of Africa, Asia and Europe, are essentially insignificant. Perhaps we can back off and give a nudge here, make an unspoken threat there. But if we keep control of the skies over our fleets (with carriers) and maintain our capacity to destroy any fleet that might challenge us, our need to send in troops (for any but rather silly ideological reasons—like Iraq and Vietnam) will be minimal.
We must learn the core premise of Balance of Power politics—as articulated by England’s Prime Minister Palmerston: “A Great Power has no friends, only interests.” Bluntly put, “We don’t care if you are Communists or cannibals, as long as you allow us to make money trading with you, and you do not challenge us at sea.”
This is a British policy we might consider emulating. It worked. It prevented major war in a divided and fractious Europe. Only when Germany decided to go head to head with England in the area of naval power, did she finally become entangled in the alliances that toppled over on themselves in 1914.
As World War I shows us, disengagement won’t last forever, but it may provide us with a long and peaceful run, as it did Britain. Right now, we’re letting our navy slip badly. There is a real question, as the Russian navy roams the Caribbean freely (as a reaction to our foolish provocations in Eastern Europe and the former soviet block nations) whether we have enough naval muscle off our southern coast to control those waters effectively.
That question had better never arise seriously. (We have too many indigenous enemies down there.) Back off the fun stuff with tanks and M-16s, and put your money where your navy (and naval air arm) is.
That’s where your oil and your without which not metals that keep a modern society come from—the areas that our navy can control. Here, we could learn from Imperial Britain. Maybe we’d better, fast.
After 1815, England stood offshore from the continent, played balance of power politics with a nudge here or a threat there, and avoided participation in any European shooting war from 1815 to 1914—with one small exception when she was asked to participate in an anti-Russian coalition in the Crimea.
Contrast this to the Eighteenth Century in which British troops fought major battles on the continent in four world-wide wars. In the Nineteenth, she left Europe alone as long as her sea power was unchallenged.
She stood aloof as mortal enemy, France, went from Monarchy to Republic to Empire to Republic. She insisted on the Tripartite Treaty of 1830 when the United Netherlands split into two ineffectual parts but did nothing more. She stood idle as nearly every government in western and central Europe collapsed in revolutionary convulsions in 1848.
She did nothing as a series of German wars eliminated Austria as a Major Power, humiliated France and created a dangerously powerful united Germany. She stayed out of the Russo-Turkish War in 1878, only participating in the Congress of Berlin that year.
She watched, she put a thumb on the scale here or there, but she did nothing military. It worked because she had unchallenged control of the seas—all over the globe. When Spain, Russia, Austria, France and Prussia wanted to invade the United States in 1820, they couldn’t move without the approval of the British fleet—which never came.
When France wanted to fight Russia over the Holy Places in Turkish Jerusalem, not an army could move unless transported by the British navy. France and Spain could not invade Mexico in 1862 without the concurrence of Britain. All three went in together.
Few Americans are aware of how close the United States came to destruction in 1861-2. It was not the prowess of Robert E. Lee, but the threat of British naval intervention on behalf of the Confederacy that could have ended our existence. Only the dying Prince Albert, propped up in bed, saved us.
In other words, in the words of an American naval captain and author, Albert Thayer Mann, sea power was the key. Sea power was supreme. From Napoleon to the Kaiser there were no world wars—because sea power prevented them. (At some point someone has to say something about Rothschild financial power which certainly prevented wars in the early 19th Century, but the real teeth lay with the British navy.)
With all of our concentration on top-of-the line land vehicles and army special forces, Americans have possibly forgotten Thayer’s point. The British army during the Pax Britannica was tiny. It was good for colonial wars, period.
It might truly be said that if we continue to rule the waves, what happens on the land masses of Africa, Asia and Europe, are essentially insignificant. Perhaps we can back off and give a nudge here, make an unspoken threat there. But if we keep control of the skies over our fleets (with carriers) and maintain our capacity to destroy any fleet that might challenge us, our need to send in troops (for any but rather silly ideological reasons—like Iraq and Vietnam) will be minimal.
We must learn the core premise of Balance of Power politics—as articulated by England’s Prime Minister Palmerston: “A Great Power has no friends, only interests.” Bluntly put, “We don’t care if you are Communists or cannibals, as long as you allow us to make money trading with you, and you do not challenge us at sea.”
This is a British policy we might consider emulating. It worked. It prevented major war in a divided and fractious Europe. Only when Germany decided to go head to head with England in the area of naval power, did she finally become entangled in the alliances that toppled over on themselves in 1914.
As World War I shows us, disengagement won’t last forever, but it may provide us with a long and peaceful run, as it did Britain. Right now, we’re letting our navy slip badly. There is a real question, as the Russian navy roams the Caribbean freely (as a reaction to our foolish provocations in Eastern Europe and the former soviet block nations) whether we have enough naval muscle off our southern coast to control those waters effectively.
That question had better never arise seriously. (We have too many indigenous enemies down there.) Back off the fun stuff with tanks and M-16s, and put your money where your navy (and naval air arm) is.
That’s where your oil and your without which not metals that keep a modern society come from—the areas that our navy can control. Here, we could learn from Imperial Britain. Maybe we’d better, fast.
Saturday, December 6, 2008
Return of the Queen?
So Caroline Kennedy Schlossberg has called Governor David Paterson of New York and indicated an interest in being appointed to Hilary’s Senate Seat—should the latter be confirmed as Secretary of State. Barring an almost incredible stumble, there is possibly America’s first woman President.
If appointed this January, Caroline would have to run in a special election in 2010 and, again, for the regular election in 2012. That should not be a problem. There will be plenty of money from all kinds of sources, and she will, in the words of cousin, Robert, have the vigorous support of “more Kennedy’s than you’ve ever seen before.”
Indeed, she will wind a horn so compelling as not heard on this continent since Father Abraham summoned volunteer soldiers to put down the secessionists in 1861. It all but sends chills up an old man’s spine to imagine who all might come out for her.
And she might just be worth all the folderol. As my wife put it, to the extent she is a Kennedy, she seems more like Rose—with a touch of Joe—than Jack. Those were tough, competent people. She also seems to have the steel that went into Jackie’s backbone—a fierce woman who took the bit of celebrity fluff that was her husband and single handedly made him into a monumental legend.
Caroline comes from awesome stock: Jackie, Rose and Joe—and don’t forget brother-in-law Bobbie, of whom Joe said, “He’s like me.” On top of that she inherits the mantle (Jackie-made) of her martyred father. She is also the niece of Teddy, who has become one of the most effective senators of the past forty years.
She’s seems very unlike her brother. He, poor lad, had his one moment of glory when, at age three, he saluted his daddy’s casket on the capitol steps (I remember standing across the street that day and watching—it’s a memory that still brings tears to my eyes).
After that, John John never seemed sure of his direction or his bearings. Tragic though his death was, it was an apt summation of his life—getting lost in a fog, confusing up and down, and crashing into the sea. God rest him.
Caroline never seems to have gotten lost or confused. She married a man who could afford her the privacy and security in which to raise a family securely (what Jackie was looking for in Onassis, but never obtained). She flew contentedly below the radar until this job was done.
Now that this phase is done, thinking of Tolkien, she seems ready to cast off the gray cloak and reveal the White Wizard beneath. My suspicion is that we are going to see one smart, tough lady underneath any velvet gloves she may wear. She’ll probably be much savvier than Hilary.
Interesting development to say the least. Of course, Governor Paterson could put a wrench in the works by refusing to appoint her. There are many, many other interested persons. Probably some that he owes more to.
But Caroline brings some practical things to the job—huge name recognition for keeping the seat in the Democratic column no matter what happens in Washington, a huge draw for money. Many, many allies who could help Paterson, too. And Paterson has to sense that he’d be getting in the way of some kind of historical destiny by saying “no”. (Who wants that as his legacy?)
Who needs all the Kennedys and their friends as enemies? Boy, would he have them. That thought—remember the old Irish Mafia?—has to give any politician on the East Coast pause. Furthermore, a new Democratic president takes office in January who doesn’t owe anybody in New York like he owes Caroline
I don’t often get terribly emotional about politicians, but if that lady were to run in 2012 or 16, and I were still around to vote, I cannot imagine anyone my fellow Republicans could run against her who could keep my fingers from twitching toward the Democratic column.
After all, “Once there was a Camelot” is a whale of a line (even if the real Camelot was probably a broken down Roman villa)—and it’s certainly time to bring back Julie Andrews and Richard Burton.
If appointed this January, Caroline would have to run in a special election in 2010 and, again, for the regular election in 2012. That should not be a problem. There will be plenty of money from all kinds of sources, and she will, in the words of cousin, Robert, have the vigorous support of “more Kennedy’s than you’ve ever seen before.”
Indeed, she will wind a horn so compelling as not heard on this continent since Father Abraham summoned volunteer soldiers to put down the secessionists in 1861. It all but sends chills up an old man’s spine to imagine who all might come out for her.
And she might just be worth all the folderol. As my wife put it, to the extent she is a Kennedy, she seems more like Rose—with a touch of Joe—than Jack. Those were tough, competent people. She also seems to have the steel that went into Jackie’s backbone—a fierce woman who took the bit of celebrity fluff that was her husband and single handedly made him into a monumental legend.
Caroline comes from awesome stock: Jackie, Rose and Joe—and don’t forget brother-in-law Bobbie, of whom Joe said, “He’s like me.” On top of that she inherits the mantle (Jackie-made) of her martyred father. She is also the niece of Teddy, who has become one of the most effective senators of the past forty years.
She’s seems very unlike her brother. He, poor lad, had his one moment of glory when, at age three, he saluted his daddy’s casket on the capitol steps (I remember standing across the street that day and watching—it’s a memory that still brings tears to my eyes).
After that, John John never seemed sure of his direction or his bearings. Tragic though his death was, it was an apt summation of his life—getting lost in a fog, confusing up and down, and crashing into the sea. God rest him.
Caroline never seems to have gotten lost or confused. She married a man who could afford her the privacy and security in which to raise a family securely (what Jackie was looking for in Onassis, but never obtained). She flew contentedly below the radar until this job was done.
Now that this phase is done, thinking of Tolkien, she seems ready to cast off the gray cloak and reveal the White Wizard beneath. My suspicion is that we are going to see one smart, tough lady underneath any velvet gloves she may wear. She’ll probably be much savvier than Hilary.
Interesting development to say the least. Of course, Governor Paterson could put a wrench in the works by refusing to appoint her. There are many, many other interested persons. Probably some that he owes more to.
But Caroline brings some practical things to the job—huge name recognition for keeping the seat in the Democratic column no matter what happens in Washington, a huge draw for money. Many, many allies who could help Paterson, too. And Paterson has to sense that he’d be getting in the way of some kind of historical destiny by saying “no”. (Who wants that as his legacy?)
Who needs all the Kennedys and their friends as enemies? Boy, would he have them. That thought—remember the old Irish Mafia?—has to give any politician on the East Coast pause. Furthermore, a new Democratic president takes office in January who doesn’t owe anybody in New York like he owes Caroline
I don’t often get terribly emotional about politicians, but if that lady were to run in 2012 or 16, and I were still around to vote, I cannot imagine anyone my fellow Republicans could run against her who could keep my fingers from twitching toward the Democratic column.
After all, “Once there was a Camelot” is a whale of a line (even if the real Camelot was probably a broken down Roman villa)—and it’s certainly time to bring back Julie Andrews and Richard Burton.
Thursday, December 4, 2008
Finally, an AMERICAN foreign policy?
We’ve just elected a man President who spent his entire campaign promising “change”. As I thought about that, it dawned on me that there is one aspect of American national policy that hasn’t been changed—or even looked at—for decades or, possibly, centuries.
It’s been assumed. Our foreign policy has been assumed and followed without question or evaluation ever since John Smith set out to explore the American coast to find a sea route to China. Even as an independent nation, we have just walked into it. Without evaluation, without thought. Especially since 1945.
Our current foreign policy was essentially made in London by British statesmen after the Napoleonic Wars—roughly from 1815 on. It hasn’t really changed since then. We have simply stepped into British shoes and followed their lead—especially after World War II.
British/American foreign policy has consisted of three major, unchanging objectives since the Congress of Vienna that recreated a post-Napoleonic World. One) Control of the oceans; two) opposition to Russian aggrandizement, and three, control of the China trade.
During the Nineteenth Century the Anglo-American conflict with Russia was characterized as a struggle between the British whale (navy) and the Russian elephant (army). Each was seen as dominant in its own area but, with few exceptions, neither was ever actually able to get at the other. Nor much changed in the last century.
In the 1940s this struggle between autocratic Russia (the Soviets) and democratic Britain/America was called the “Cold War”. But it was really no different than the Nineteenth Century struggle.
Throughout the Nineteenth Century version of the Cold War, British interests spread across the Asian land mass, facing Russia at every point. Britain backed the Muslim Turkish Empire (kept it in existence) that had been warring against Russia for centuries, as a way of holding the Russians in check from the Mediterranean to the border of Persia (Iran).
By 1907, Britain had effectively split Iran in two—with Britain controlling the oil-rich south and Russia having primary say in the northern third. In between was a quasi independent Iran that came under the rule of the British backed Pahlavi dynasty. When the Shah was overthrown in 1953, British MI6 and the CIA worked together to restore his rule—making Iran an anti-Russian state.
Coming out of Pakistan, part of the British Empire until 1947 and, after that, an American Cold War ally, the Anglo-Americans kept tabs on Russian/Soviet activities in Afghanistan—going back to the 1840s. (The Afghans got so annoyed with this game that they wiped out an entire British army back then.)
Then came the Pacific confrontation. The Russians chewed began chewing up pieces of China. Keeping China open to Western trade has been a cornerstone of Anglo-American foreign policy since before Jamestown was founded. Wherever the British navy went in the Nineteenth Century, an American gunboat—or just a freighter with a single cannon slung over the stern—went along.
Britain propped up an ailing Manchu dynasty (that would otherwise have collapsed 50 years earlier) as a block to foreign interests in China and keep her interests paramount. We stepped in subsequently and propped up an equally sick Kuomintang regime. The British lost their pet regime to Sun Yat-sen in 1911; we lost our pet to Mao in 1949. (Now the Chinese prop up our economy. Such is the irony of history.)
The Russian fleet at Vladivostok remained a threat until the Japanese sank it for us in 1904. In the meantime, the British squeezed Russia out of the San Francisco in 1841, and we ended the Russian-American company by buying Alaska and all Russian West coast interests in 1867.
(Think how differently the Twentieth Century Cold War might have gone if the Russians had had a major military presence in this hemisphere!)
When Britain’s power effectively collapsed at the end of World War II, we stepped into every foxhole abandoned by a Tommy. Our fleets ruled the Mediterranean, the South China Sea, the Indian Ocean. Different flag, same basic policy.
(Worth noting that the British collapse in the late 1940s was very much our doing. We made sure, by manipulation of the provisions of Lend Lease, that Britain accumulated no cash reserves during the War. When it was over, we stopped Lend Lease on a dime—leaving England with 12 million troops to feed, clothe, medicate and transport around the globe, without a six pence in the coffers. Their Empire, and their Cold War, was effectively over by 1948.)
Okay, we’ve inherited Britain’s foreign policy and much of the territory she controlled. Without thinking about it, we just carried on—taking up Kipling’s “White Man’s Burden”.
Maybe it’s time we put the burden down for a moment and thought about it. We’re not England. The Congress of Vienna was a long time ago. Maybe, just maybe, it is time for a change.
It will take us awhile to figure out just what that change should be. When you’ve been pointed in the same direction for 400 years, it’s hard to think of going any other way. So this won’t be easy. It may be as wrenching as the Civil Rights Movement or the Civil War—a whole new way of viewing the world.
But it would be change that REALLY would be change.
It’s been assumed. Our foreign policy has been assumed and followed without question or evaluation ever since John Smith set out to explore the American coast to find a sea route to China. Even as an independent nation, we have just walked into it. Without evaluation, without thought. Especially since 1945.
Our current foreign policy was essentially made in London by British statesmen after the Napoleonic Wars—roughly from 1815 on. It hasn’t really changed since then. We have simply stepped into British shoes and followed their lead—especially after World War II.
British/American foreign policy has consisted of three major, unchanging objectives since the Congress of Vienna that recreated a post-Napoleonic World. One) Control of the oceans; two) opposition to Russian aggrandizement, and three, control of the China trade.
During the Nineteenth Century the Anglo-American conflict with Russia was characterized as a struggle between the British whale (navy) and the Russian elephant (army). Each was seen as dominant in its own area but, with few exceptions, neither was ever actually able to get at the other. Nor much changed in the last century.
In the 1940s this struggle between autocratic Russia (the Soviets) and democratic Britain/America was called the “Cold War”. But it was really no different than the Nineteenth Century struggle.
Throughout the Nineteenth Century version of the Cold War, British interests spread across the Asian land mass, facing Russia at every point. Britain backed the Muslim Turkish Empire (kept it in existence) that had been warring against Russia for centuries, as a way of holding the Russians in check from the Mediterranean to the border of Persia (Iran).
By 1907, Britain had effectively split Iran in two—with Britain controlling the oil-rich south and Russia having primary say in the northern third. In between was a quasi independent Iran that came under the rule of the British backed Pahlavi dynasty. When the Shah was overthrown in 1953, British MI6 and the CIA worked together to restore his rule—making Iran an anti-Russian state.
Coming out of Pakistan, part of the British Empire until 1947 and, after that, an American Cold War ally, the Anglo-Americans kept tabs on Russian/Soviet activities in Afghanistan—going back to the 1840s. (The Afghans got so annoyed with this game that they wiped out an entire British army back then.)
Then came the Pacific confrontation. The Russians chewed began chewing up pieces of China. Keeping China open to Western trade has been a cornerstone of Anglo-American foreign policy since before Jamestown was founded. Wherever the British navy went in the Nineteenth Century, an American gunboat—or just a freighter with a single cannon slung over the stern—went along.
Britain propped up an ailing Manchu dynasty (that would otherwise have collapsed 50 years earlier) as a block to foreign interests in China and keep her interests paramount. We stepped in subsequently and propped up an equally sick Kuomintang regime. The British lost their pet regime to Sun Yat-sen in 1911; we lost our pet to Mao in 1949. (Now the Chinese prop up our economy. Such is the irony of history.)
The Russian fleet at Vladivostok remained a threat until the Japanese sank it for us in 1904. In the meantime, the British squeezed Russia out of the San Francisco in 1841, and we ended the Russian-American company by buying Alaska and all Russian West coast interests in 1867.
(Think how differently the Twentieth Century Cold War might have gone if the Russians had had a major military presence in this hemisphere!)
When Britain’s power effectively collapsed at the end of World War II, we stepped into every foxhole abandoned by a Tommy. Our fleets ruled the Mediterranean, the South China Sea, the Indian Ocean. Different flag, same basic policy.
(Worth noting that the British collapse in the late 1940s was very much our doing. We made sure, by manipulation of the provisions of Lend Lease, that Britain accumulated no cash reserves during the War. When it was over, we stopped Lend Lease on a dime—leaving England with 12 million troops to feed, clothe, medicate and transport around the globe, without a six pence in the coffers. Their Empire, and their Cold War, was effectively over by 1948.)
Okay, we’ve inherited Britain’s foreign policy and much of the territory she controlled. Without thinking about it, we just carried on—taking up Kipling’s “White Man’s Burden”.
Maybe it’s time we put the burden down for a moment and thought about it. We’re not England. The Congress of Vienna was a long time ago. Maybe, just maybe, it is time for a change.
It will take us awhile to figure out just what that change should be. When you’ve been pointed in the same direction for 400 years, it’s hard to think of going any other way. So this won’t be easy. It may be as wrenching as the Civil Rights Movement or the Civil War—a whole new way of viewing the world.
But it would be change that REALLY would be change.
Wednesday, December 3, 2008
Great Expectations
If Barack Obama is as smart as they say he is, he’s fighting off an urge to go somewhere hard to find and hide. Deep inside, maybe, but somewhere that’s gut honest—that’s what he should be wanting to do in those moments when he can afford just to stop and think.
He has to be reading at least some of the same media articles I am: Time, Newsweek, Business Week, Network TV, newspapers, and so forth. I read them and I’m genuinely concerned—for him and for the nation. I’ve never seen anything quite like it.
I remember observing the run-ups to the presidencies of Eisenhower, Nixon, Carter, Reagan, the first Bush, Clinton, the second Bush—and even the coming of Kennedy’s Camelot. I cannot remember a level of expectation like the present.
It’s as if they are expecting Obama to walk on water, turn the water into enormous amounts of cash, and raise all the debtor banks and corporations from the dead. The Media rave over his every appointment as if the appointees represent the second coming of the Twelve Apostles.
I can’t say Obama is feeding this frenzy. He seems to have a good enough grasp of reality to keep murmuring disclaimers and warning of difficulties ahead. Those who expect him to work miracles just don’t seem to be listening either to him or to the facts.
From the Mediterranean coast to the Indian subcontinent, we seem to be caught in deep quick sand with no obvious or easy way out. Whatever we do, however we extricate ourselves, something’s going to be worse than it was before.
Perhaps it’s like the people who fixed my wife’s laptop computer lately. They had to replace the speakers and that required a new mother board. Putting in the mother board broke the hard drive. (This all worked out well for my wife; she had a good warranty. But there never were guarantees for Iraq, Afghanistan or Pakistan/India—or Iran, or the fragile regime in Saudi Arabia.)
The best suggestion I’ve heard for that area (Newsweek) is that we pull out all bases—to cut down Muslim resentment at our physical presence—and maintain a balance of power by projecting our influence from outside the region. Great idea—very like Britain’s Nineteenth Century foreign policy, but we’ve already got our feet and hands stuck in the tar baby. It’s one mad tar baby to boot.
In some ways our military/foreign policy situation hasn’t looked this bleak since the combination we faced in early 1942: the fall of the Philippines, a row of sunken battleships, a massive German U-boat assault in the Atlantic, the fall of Tobruk in North Africa, the apparently unstoppable German attack into the Crimea in Russia. And we’re only looking at the top of the ice berg.
It could be pulled out, but it’s going to require all the ducks agreeing to sit in a row perfectly still. (Ask a duck hunter just how easy that is.) In other words, an enormous combination of luck and potentially unpopular moves that may be seen here as defeat. (Who lost China? Remember?)
Then there’s our economic situation. Oh boy. Bottom line is that everything Obama needs to do, everything he has promised to do, everything he is being advised to do is totally, finally, and utterly dependent on China continuing to buy US bonds (debt).
What if China stops? Not because it’s trying to hurt us, necessarily (after all, we’re their biggest market!), but because it is having enough economic and political problems at home—already there is serious unrest among the Chinese because of rising unemployment—so that spending any more cash on American treasuries (funding our national debt) just isn’t feasible? They already have a huge reserve of dollars.
Then where do we find the billions and trillions for bailouts and guarantees? The Japanese have finally stopped buying treasuries; only China is left as a high roller. If the Chinese cash stopped flowing, where would we find the money for better health care, repairs on infrastructure, and 21st Century education that Obama promised last fall?
China’s willingness to go on funding our debt is a slim thread to be hanging by. It’s a little like an NFL team whose only hope for the playoff is for a team that hasn’t been beaten all season to lose its next two games. Talk about needing a little help from your friends! Obama and company really, really do.
What if Obama doesn’t come through on the Messiah like expectations built up around him? Lyndon Johnson got a strong dose of the bile a constituency scorned can spew. I’ve an awful feeling that just as our expectations for Obama are higher and more unrealistic than they were for LBJ, so the bile will burn hotter when it comes.
He may live to wish someone found out he was actually born abroad and thus ineligible for the Presidency.
He has to be reading at least some of the same media articles I am: Time, Newsweek, Business Week, Network TV, newspapers, and so forth. I read them and I’m genuinely concerned—for him and for the nation. I’ve never seen anything quite like it.
I remember observing the run-ups to the presidencies of Eisenhower, Nixon, Carter, Reagan, the first Bush, Clinton, the second Bush—and even the coming of Kennedy’s Camelot. I cannot remember a level of expectation like the present.
It’s as if they are expecting Obama to walk on water, turn the water into enormous amounts of cash, and raise all the debtor banks and corporations from the dead. The Media rave over his every appointment as if the appointees represent the second coming of the Twelve Apostles.
I can’t say Obama is feeding this frenzy. He seems to have a good enough grasp of reality to keep murmuring disclaimers and warning of difficulties ahead. Those who expect him to work miracles just don’t seem to be listening either to him or to the facts.
From the Mediterranean coast to the Indian subcontinent, we seem to be caught in deep quick sand with no obvious or easy way out. Whatever we do, however we extricate ourselves, something’s going to be worse than it was before.
Perhaps it’s like the people who fixed my wife’s laptop computer lately. They had to replace the speakers and that required a new mother board. Putting in the mother board broke the hard drive. (This all worked out well for my wife; she had a good warranty. But there never were guarantees for Iraq, Afghanistan or Pakistan/India—or Iran, or the fragile regime in Saudi Arabia.)
The best suggestion I’ve heard for that area (Newsweek) is that we pull out all bases—to cut down Muslim resentment at our physical presence—and maintain a balance of power by projecting our influence from outside the region. Great idea—very like Britain’s Nineteenth Century foreign policy, but we’ve already got our feet and hands stuck in the tar baby. It’s one mad tar baby to boot.
In some ways our military/foreign policy situation hasn’t looked this bleak since the combination we faced in early 1942: the fall of the Philippines, a row of sunken battleships, a massive German U-boat assault in the Atlantic, the fall of Tobruk in North Africa, the apparently unstoppable German attack into the Crimea in Russia. And we’re only looking at the top of the ice berg.
It could be pulled out, but it’s going to require all the ducks agreeing to sit in a row perfectly still. (Ask a duck hunter just how easy that is.) In other words, an enormous combination of luck and potentially unpopular moves that may be seen here as defeat. (Who lost China? Remember?)
Then there’s our economic situation. Oh boy. Bottom line is that everything Obama needs to do, everything he has promised to do, everything he is being advised to do is totally, finally, and utterly dependent on China continuing to buy US bonds (debt).
What if China stops? Not because it’s trying to hurt us, necessarily (after all, we’re their biggest market!), but because it is having enough economic and political problems at home—already there is serious unrest among the Chinese because of rising unemployment—so that spending any more cash on American treasuries (funding our national debt) just isn’t feasible? They already have a huge reserve of dollars.
Then where do we find the billions and trillions for bailouts and guarantees? The Japanese have finally stopped buying treasuries; only China is left as a high roller. If the Chinese cash stopped flowing, where would we find the money for better health care, repairs on infrastructure, and 21st Century education that Obama promised last fall?
China’s willingness to go on funding our debt is a slim thread to be hanging by. It’s a little like an NFL team whose only hope for the playoff is for a team that hasn’t been beaten all season to lose its next two games. Talk about needing a little help from your friends! Obama and company really, really do.
What if Obama doesn’t come through on the Messiah like expectations built up around him? Lyndon Johnson got a strong dose of the bile a constituency scorned can spew. I’ve an awful feeling that just as our expectations for Obama are higher and more unrealistic than they were for LBJ, so the bile will burn hotter when it comes.
He may live to wish someone found out he was actually born abroad and thus ineligible for the Presidency.
Tuesday, December 2, 2008
Never Mind Who--WHERE Was Your Mama?
Rumors are flying again: is Barack Obama a natural born American citizen or isn’t he? If he isn’t that makes him ineligible under the Constitution to be president. His Kenyan grandmother says he was born in Kenya. Hawaii supposedly refuses to affirm that he was born there.
I cannot remember this issue being raised since George Romney ran for the Republican nomination in 1968. It was rumored that his parents had been members of an heretical Mormon sect that took refuge in Mexico about the time of his birth.
Before this became a serious question, Romney’s campaign flamed out in late winter. It hasn’t been an issue since then, and I can’t recall if it ever was before then. It’s certainly never been brought up AFTER a candidate was elected!
The Constitution is unambiguously clear on the point. The American electorate was unambiguously clear on its majority vote for candidate Obama. There is an unusual emotional quotient to his election—the young, the blacks and even a lot of other minorities feel they have a personal stake in Obama.
Many members of these groups, especially the young, have never before been politically active. A lot of them may not be politically sophisticated. Were they to feel that a two hundred year old legal technicality had deprived them of their victory, they are not likely to take it calmly.
In the highly unlikely case that Obama is not legally a natural born American, that’s going to raise Constitutional questions no one ever thought of. Not when Nixon resigned. Not when George W. Bush won the presidency in court. Obama’s ticket won—does that mean that Joe Biden automatically gets sworn in on January 20? (Under the Twelfth Amendment.)
Does the whole ticket get tossed out? (Remember the Supreme Court still has a Republican majority.) Or does the Electoral College get its chance to do something new and original—as is their actual right under the Constitution? Or does it get tossed into the House of Representatives?
Oh, the possibilities! It dazzles the mind. We won’t have seen such engrossing politics since the Watergate Hearings—or the McCarthy Army Hearings. It may also shake the living daylights out of the American political process. Think how happy Wall Street and the banking community will be with new waves of uncertainly washing over them.
Throw in a few likely mass demonstrations, not impossibly a riot or two, and you have a really unstable situation. After the immediate reaction calms down, will most of the new voters go back into their shells never to believe—or vote—again?
Internationally, the leaders and populations who are so excited about a new beginning under Obama, are simply not going to believe it. (The Chinese couldn’t believe it when we squeezed Nixon out for what they saw as a very minor infraction. Almost no one abroad could.)
Many will be sure the real reason was racial. Others will think there was some kind of hidden conspiracy to protect the status quo nationally or internationally. They’ll believe “somebody” powerful just didn’t want Obama’s notion of change.
Today things are merely at the point of a rumor with all the staying power of snow in Puerto Rico. But there is always the outside chance that someone, somewhere will come up with enough evidence to convince enough of the right (or wrong) people to bring things to a head,
The people who are alleging this are serious. Presidents have survived nutty rumors throughout our history. But that, maybe, two percent chance that Obama’s place of birth could be cast into real doubt is one to give everyone a moment’s pause.
I cannot remember this issue being raised since George Romney ran for the Republican nomination in 1968. It was rumored that his parents had been members of an heretical Mormon sect that took refuge in Mexico about the time of his birth.
Before this became a serious question, Romney’s campaign flamed out in late winter. It hasn’t been an issue since then, and I can’t recall if it ever was before then. It’s certainly never been brought up AFTER a candidate was elected!
The Constitution is unambiguously clear on the point. The American electorate was unambiguously clear on its majority vote for candidate Obama. There is an unusual emotional quotient to his election—the young, the blacks and even a lot of other minorities feel they have a personal stake in Obama.
Many members of these groups, especially the young, have never before been politically active. A lot of them may not be politically sophisticated. Were they to feel that a two hundred year old legal technicality had deprived them of their victory, they are not likely to take it calmly.
In the highly unlikely case that Obama is not legally a natural born American, that’s going to raise Constitutional questions no one ever thought of. Not when Nixon resigned. Not when George W. Bush won the presidency in court. Obama’s ticket won—does that mean that Joe Biden automatically gets sworn in on January 20? (Under the Twelfth Amendment.)
Does the whole ticket get tossed out? (Remember the Supreme Court still has a Republican majority.) Or does the Electoral College get its chance to do something new and original—as is their actual right under the Constitution? Or does it get tossed into the House of Representatives?
Oh, the possibilities! It dazzles the mind. We won’t have seen such engrossing politics since the Watergate Hearings—or the McCarthy Army Hearings. It may also shake the living daylights out of the American political process. Think how happy Wall Street and the banking community will be with new waves of uncertainly washing over them.
Throw in a few likely mass demonstrations, not impossibly a riot or two, and you have a really unstable situation. After the immediate reaction calms down, will most of the new voters go back into their shells never to believe—or vote—again?
Internationally, the leaders and populations who are so excited about a new beginning under Obama, are simply not going to believe it. (The Chinese couldn’t believe it when we squeezed Nixon out for what they saw as a very minor infraction. Almost no one abroad could.)
Many will be sure the real reason was racial. Others will think there was some kind of hidden conspiracy to protect the status quo nationally or internationally. They’ll believe “somebody” powerful just didn’t want Obama’s notion of change.
Today things are merely at the point of a rumor with all the staying power of snow in Puerto Rico. But there is always the outside chance that someone, somewhere will come up with enough evidence to convince enough of the right (or wrong) people to bring things to a head,
The people who are alleging this are serious. Presidents have survived nutty rumors throughout our history. But that, maybe, two percent chance that Obama’s place of birth could be cast into real doubt is one to give everyone a moment’s pause.
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