The following expressions, except as where I have indicated I have sourced the definition and etymology from my previous writings, are taken from a little 2007 book I Didn’t Know That by Karlen Evins. I hope you will find them as interesting and illuminating as I did:
A-1
More than a steak sauce, the phase itself connotes the very best, because, by definition, it was the highest rating that could be given a ship ensured by Lloyd’s of London. Lloyd’s registry of ships and shipping was categorized by letter and number (with ships rated by letter and cargo by number). “A” meant the ship itself was perfect and “1” meant the cargo was in perfect condition.
Aftermath (From my other sources)
Aftermath is commonly and erroneously used to simply mean the period following an event, usually a disaster such as a fire, hurricane, or tornado: “In the aftermath of the tornado, many people in the neighborhood are still homeless.” Television and newspaper reporters are especially guilty of misusing this word. ‘After’ means second and ‘math’ is a mowing or harvest. So an ‘aftermath’ is a second happening, usually a disaster, following and caused by the first event. The San Francisco fire was an aftermath as it was a disaster following and caused by the earthquake of 1906.
Backseat Driver
Think backseat driver and you think of one who complains or one who thinks he can see better from the rear seat than from the front of a vehicle. But the original backseat drivers weren’t complainers. Matter of fact for what they were watching, they could see better! In the days of the early fire engines there was a job for backseat drivers. Someone needed to watch the ladder as fire engines rushed to the scene. As quick turns and abrupt stops were causes for accidents, a backseat driver was as vital a part of the fire team as the firefighters themselves.
Beyond the Pale
Pale is from the Latin word palus which was a stake or boundary marker that fenced the territory under rule by a certain nation. Paling or pickets were quite common as boundary markers in Roman times. Those believed to be beyond the bounds of social or moral decency were once literally exiled beyond the pale or beyond the confines of civilization as determined by the townspeople.
Blackball
Early social clubs in England had a practice of voting for their initiates by dropping white balls or marbles into a ballot box. Those voting against a particular candidate dropped a blackball, hence the term. While the term was first coined in the late 1700s the custom dates back to ancient Greek and Roman times. Even our word ballot refers to voting by little balls.
Cahoots
Cahoots were quite simply little cabins or kajuetes as they were called in medieval Germany. Often known to be occupied by robbers and bandits, these little cabins became planning centers for attacks. So in reality it was the goings-on inside the cabins that became known for what the cabins themselves were called. Today we use cahoots to refer to any shady partnership or less than upright scheme.
Carte Blanche
Ask for carte blanche in France and you just might receive a white sheet of paper because translated literally that is what the term means. Custom has it that a man would trust his closest subordinates with blank sheets or correspondence cards with only his name at the bottom in order that they might use them for whatever needs they might have in a time of crisis (not much different from a blank check today).
Clean as a Whistle
You might not think of a whistle as being so clean that we would use it as a measure of cleanliness, but if you ever tried to make one from a reed (as they were made originally) then you would understand the phrase. To obtain the pure wind sound derived from a reed whistle the tube must be totally free of debris – clean and dry. So to have a thing clean as a whistle today means to have it as orderly as possible, with nothing blocking the passageways.
Crocodile Tears
Those insincere tears we have come to know as crocodile tears are quite literal in origin. For you see, a crocodile does indeed cry over its meal as it eats. But the crying has nothing to do with a croc’s sense of the situation. Instead, as a crocodile eats, his food is pressed to the top of his mouth, causing pressure against the glands known as the lachrymals. These secrete a tear-like substance that flows from his eyes. From this biological active of the reptile we draw our meaning for crocodile tears.
Curmudgeon (From my other sources)
The coinage of curmudgeon is beyond interesting; it is downright fascinating. Dr. Samuel Johnson decided to write his dictionary of the English language because he thought the language was being ‘corrupted’ (after delving deeply into the subject and being astute and intellectually honest, he rejected his original conviction and came to the conclusion that language is a living, breathing, evolving entity).
As related by Bergen Evans, while Johnson was compiling material for his dictionary he received a letter suggesting that the word curmudgeon was derived from the French coeur (heart) and méchant (evil). Either the letter was unsigned or he lost it and forgot who wrote it. The suggestion, though unsupported, was plausible and in his dictionary (1755) Johnson set it down for what it was worth: “a vitious manner of pronouncing coeur méchant, Fr. an unknown correspondent.” In his New and Complete Dictionary of the English Language (1775), Dr John Ash, cribbing from Johnson, but, unfortunately for him, knowing no French entered it as “from the French coeur unknown, méchant correspondent.” This is one of history’s most amusing and notorious instances of plagiarism. The antics of authors Stephen Ambrose and Doris Kearns Goodwin were drab and colorless by comparison.
Dead as a Doornail
What is a doornail anyway? Well, I am here to tell you. A doornail is that plate or knob upon which a door’s knocker knocks! As it never moves and is pounded upon repeatedly, we assume it’s dead. Hence the reference (some things are just too easy).
Dessert
It is the French who gave us both the word and the custom of the dessert. By definition their word desservir means to “clear the table,” which originally consisted of clearing both dishes and the tablecloth to make way for the final presentation. Most often that final course was a pastry or ice cream, but in all cases it was something sweet to end the meal. It was believed at that time that the sugar in the sweet was necessary to give a rush of energy in order that all of the foods consumed during the meal could be digested.
Dressed to the Nines
No, this does not mean that on a scale of one to ten, one is dressed almost perfectly. The expression is English in origin and was (when spoken correctly), “dressed to thy’n eyes.” (quite obviously in reference to one spiffed up from head to toe). Leave it to us to make it slang, mispronounce it a bit and make it a popular expression, even though “dressed to the nines” in and of itself makes no sense!
Earmark
[We have heard about earmarks in the past couple of years from corrupt congressmen (Are there any other kind? Yes there are – corrupt congresswomen). So let’s see where this word came from.] Long ago in England farmers found it helpful to mark the ears of their cattle and pigs to prevent thievery. Matter of fact earmarks worked so well that the law decided that one caught taking an earmarked animal or altering one to make it his own should be earmarked himself (literally!) as punishment for the crime. [I guess if it was good enough for a pig……come to think about it how about earmarking (literally!) those congress people who use earmarks as a devise for political patronage to enhance their reelection odds.]
Fiasco
By definition, fiasco is a total, foolish failure, but for its origins you have to go back to the glassblowers of Italy who created beautiful bottles. The story has it that if a bottle was noted to have a flaw it was set aside and reworked into a flask (fiasco in Italian). Not as artsy, but more practical in function was the re-created piece that was salvaged.
Getting One’s Goat
It was a common practice in the early days of horse racing to place a goat in the stall with a high-strung horse to calm him before the race. The two made good roommates, but it was also common practice for an opponent to steal his competitor’s goat in order to upset his horse before the race. Many a good racehorse was ruined by someone getting his goat!
Having a Screw Loose
It’s easy enough to conjure up the image of a machine with a screw loose, but which machine originally gave us the phrase? It was the cotton gin, the advent of which caused cotton mills to multiple at an unbelievable rate in the late 1700’s. So frequent were the breakdowns of the earlier machines that loose screws were nearly always blamed for the problem. As a result the phrase was adapted by most everyone who needed to blame something or someone for just about anything. By the early 1800’s having a screw loose became the catchphrase for something gone amiss.
Influenza
The common flu has a superstitious origin. The phrase was coined in the mid 1700’s when the first outbreak of the virus was recorded in Rome. It was believed at the time that the stars influenced such evil and contagious epidemics and influenza (the Italian word for influence) became the given name for this particular one!
Kick the Bucket
This has nothing to do with a pail being kicked out from under a man being
hanged. The phrase originated in the slaughterhouses of old, where hogs were slashed and hung (by their heels) and strung by a pulley weighted with a wooden block called a bucket. (The name was borrowed from the bucket-in-the-well concept.) Often, in the last efforts of life, the slaughtered hog was known to kick the bucket, just before it gave up the ghost.
Lame Duck
The original lame duck was a member of the British Stock Exchange who couldn’t meet his liabilities on the settlement date, and thus flew off without settling his account. From that we applied the term to our political candidates who, by way of losing an election, can’t return to the flock, even though their own party has been retained. [In recent years this term has applied to presidents serving out their term when either they are not eligible for another term or have been defeated in their bid for a second term. As with his predecessors, George W. Bush has been called a lame duck president, yet with Bush and his administration so involved, for good or ill, in the current financial crisis, he has been described as a lame duck who roared.]
Letting the Cat Out of the Bag
Back in the Middle Ages when the Muslims invaded Southern Europe, suddenly pork was declared unclean and thus became a premium on the open market. Because of strict laws forbidding such, pigs were sold undercover, stashed in bags (or pokes, which some cite to credit the expression “pig in a poke”). On occasion a cat was substituted for the more expensive pig and it wasn’t until the new owner let the cat out of the bag that the scam was revealed.
Lunatic
We get the word lunatic from the same base word that gives us lunar, which, of course, means it pertains to the moon. Lunatic was coined by the early Romans in reference to the mentally insane, as a description of one they thought was moonstruck. For centuries, man has believed that full moons have an effect on behavior. The Romans simply gave it a name and we still use it today.
One Fell Swoop (From my other sources)
At one fell swoop means all at once, as everyone realizes. As pointed out by Bergen Evans, what is not as well understood is that the word “fell” in this phrase is derived not from the past tense of “fall”, but from the noun “felon.”
In Macbeth (Act IV, scene III) when news of the murder of his wife and children by Macbeth is brought to Macduff, he exclaims, “Did you say all? O hell-kite! All? What, all my pretty chickens and their dam at one fell swoop?” A kite is a fierce but ignoble hawk or falcon that preys on small quarry and Macduff sees the tragedy in the metaphor of a hawk striking defenseless prey.
Sour Grapes (From other sources)
The words sour grapes leave a sour taste in my mouth – not literally in a gustatory sense of course, but with the figurative ill-tasting sensation of misconstruing what it means. Inevitably this expression is used to mean someone who whines or complains when they do not receive or achieve something they feel they are entitled to.
The expression comes from one of Aesop’s fables where a fox sees some delicious appearing grapes which are out of his reach and try as he might he can not get them. In frustration and resignation he allows as how they are probably sour. The expression really means that the claimant, unable to achieve his objective, declares that the prize was not worth his time and effort.
Three Sheets to the Wind
True the origin of this one is nautical, but no, the sheets are not sails. The sheets being referred to here are the ropes attached to the corners of the sails, which are used for lowering or extending. When all three sheets (on a vessel with three sails) are loosened, the ship will rock and reel as though without course or purpose, much like a drunk would if walking about while intoxicated.
Turn a Blind Eye (From my other sources)
Admiral Horatio Nelson is credited with having said this when willfully disobeying a signal to withdraw during a naval engagement. Tales of that sort, especially when they are about national heroes like Nelson, tend to be exaggerated or entirely fictitious. That doesn't appear to be the case here though and there's very good evidence to show that Nelson was indeed the source of this phrase.
In the naval battle of Copenhagen in 1801 Nelson led the attack of the British fleet against a joint Danish/Norwegian enemy. The British fleet of the day was commanded by Admiral Sir Hyde Parker. The two men disagreed over tactics and at one point Hyde Parker sent a signal (by the use of flags) for Nelson to disengage. Nelson was convinced he could win if he persisted and that's when he 'turned a blind eye'. In their biography Life of Nelson, published just eight years later, Clarke and M'Arthur printed what they claimed to be Nelson's actual words at the time:(Putting the glass to his blind eye) "You know, Foley, I have only one eye - and I have a right to be blind sometimes... I really do not see the signal."
Verdict
The word describing a jury’s decision at the end of a trial is one that dates back to the Middle Ages. With the introduction of the jury, it was superstitiously believe that twelve men in a group would hold some mystical power in drawing a truthful conclusion. The number twelve was considered holy both in reference to the twelve tribes of Israel and Jesus’ twelve apostles. It was the French who gave this body of twelve the name veir (true) and dit (said). Even in homicide cases today, a verdict cannot be obtained until all twelve on the jury reach an agreement. [The phrase for the examination of prospective jurors by the attorneys and the judge is called voir dire which is French for “too see, to speak.”]
Veto
One powerful little word is veto! With four little letters, the head of state has the power to cancel out laws passed by lower governing bodies. The word comes directly from Latin, its translation is literally “I forbid.” It was used in a political context as far back as the time of the Roman senate and has carried the same meaning both within and without political circles for hundreds of years.
Visa
Short for the Latin phrase carta visa, a visa is that official authorization that permits entry into another country. The original phrase means “papers seen”, which was the stamp of approval by those on border control, monitoring the visitors coming into and out of a foreign country.
Win, Place, or Show
Most folks know that the origin of “win, place, or show” dates back to the earliest racetracks, but most may not know that the phrase was so named because of the way in which the finishes were announced. As small boards were used to record the names of the winners of each horse race, and as these boards were so small that only the first two could be “placed” on the board, the titles “win” and “place” were soon coined. Shortly after, a second board was used to “show” the third winner and “win, “place”, or “show” became synonymous with first, second, and third.
Xmas
While some consider it disrespectful to substitute an X for the Christ part of Christmas, others know that the letter X was in fact the symbol used long ago for Christ. X represents the Greek letter chi, which is the initial letter of the Greek word for Christ. According to first century history, the early Greek Christians used the letter X to stand for Christ, much as they used the fish with the X in the tail to represent Jesus.
Zip Code
We refer to it every day, but how many of us knew [before they read this] that the ZIP stands for “Zone Improvement Program”? Okay, so you may have known that, but do you know what the five-digit code represents? Well, according to our reliable postal people, the first three digits indicate a district, usually a city, while the remaining two digits correspond with a local zone.
Saturday, December 13, 2008
Friday, October 24, 2008
1948 -49
The 1948 War between, first the Palestinian Arabs and Jews, then the Palestinian Jews and the Arab armies of Egypt, Jordan, Syria, and Iraq (Lebanon did not take part in that war) actually started in late 1947 and ended in mid 1949, although most of the fighting occurred in 1948.
Unlike the civil war in Lebanon which started in 1975 and lasted for 15 years, the Palestinian War was definitely not a Black Swan – it was building for decades (see my blog essay Black Swans for an explanation of a Black Swan). Small pitched battles and clashes between Palestinian Arabs and Jews started in the decades of the late 19th century and continued sporadically into the 1910’s, 1920’s, 1930’s and late 1940’s.
One of the best histories of this 1948 war may be the 2008 book 1948 – A history of the First Arab-Israeli War by Benny Morris. Morris is a professor of history in the Middle East Studies Department of Ben Gurion University, Beersheba, Israel. One might presume a certain amount of bias on the part of Professor Morris, yet I did not perceive any. For example Morris states that the Jews committed more atrocities and massacres against the Arabs than did the Arabs against the Jews. The reason for this was logical in that the Jews overran many more Arab towns, villages, and settlements than vice-versa on the order of several hundred versus a couple dozen. None-the-less this is an indication to me that Professor Morris is a historian first and an Israeli second.
In 1958 when I was working in Libya, North Africa for Mobil Oil, I met several young Palestinian men in Tripoli who said that in 1948 their families were given 24 hours to leave their homes in Palestine. All were allowed to take as much of their personal and household effects as they could with them, but they had to leave. Their hatred of Palestinian Jews in particular and all Jews in general was palpable. As a child in June 1948 Lidia witnessed Jews in Tripoli being stoned by Arab mobs in reaction to the war between the Palestinian Arabs and Jews (according to Professor Morris 13 Jews were killed in Tripoli). At that time Libya was under United Nations jurisdiction with the British police and military on the ground as the UN representatives. The British did not intervene in the mayhem for 24 hours. What could have motivated the British for their non action? The answer must lie in what happened in Palestine prior to the 1948 war. Palestine was a British mandate so that the British were charged with administering the area and providing security. The Jews wanted the British military out of Palestine and toward the end of the mandate resorted to committing act of terrorism to drive them out. Among the terrorism acts was the bombing of the King David Hotel (July 1946) in Jerusalem where civilians as well as British military personnel were killed.
In 1948 the Jewish population of Palestine was circa 750,000 and the Arab population almost twice that. The surrounding Arab countries which went to war had a combined population of about 40 million. How on earth could such a relatively small population beat a so much larger one? And make no mistake; although the Jews lost a few battles, they overwhelmingly won the war. There are rational reasons why this was so as I shall endeavor to explain later, with no little credit to Professor Morris.
In 1881 the population of Palestine was made up of approximately 450,000 Arabs – 90% Muslim and the rest Christian and 25,000 Jews. From 1882 to 1903 the first wave of Zionist settlers – some 30,000 Jews came to Palestine. Zionism is an international political movement that supported the reestablishment of a homeland for the Jewish people in Palestine. The word Zionism was derived from Mount Zion, a mountain near Jerusalem. The Arabs were wary of these new Jewish settlers whom they regarded as inexplicable, foolish, strange infidels, and vaguely minatory. The Jews in turn thought the Arabs devious, dirty, untrustworthy, simple, and lazy. Nothing like two peoples getting off to a good start in the Holy Land. The mantra of the Zionists was, “A land without people for a people without land.” The Jewish settlers must have been blind if they did not notice there were plenty of people in the land already.
Until around 1908-09 there were few acts of violence except of the common criminal kind. In 1909, David Ben-Gurion, who would become the first president of Israel in May 1948, was waylaid by an Arab with a knife, bent on robbery. Ben-Gurion suffered a wound to his arm and an abiding suspicion of Arabs thereafter. From 1909-1914 violence increased and took on a more nationalistic fervor – that is a more Arab vs. Jew connotation. The 1st World War from 1914 to 1919 diminished the Arab-Jew confrontations as Palestine, then part of the Ottoman Empire, which in turn was part of the Central Powers, was allied with Germany and the Austro-Hungarian Empire as concentration on the wider war was the order of the day.
On November 29, 1947 the United Nations put Resolution 181, which called for the partition of Palestine into two sovereign states – one Jewish and one Arab, to a vote. When the tally was finished, 33 UN member countries voted “yes” and 13 voted “no” with 10 abstentions. The resolution barely achieved the necessary 2/3 vote with only two votes to spare. One of the two Palestinian protagonists was jubilant and the other was angry and morose. Guess which was which. The countries voting in the affirmative were the United States, Canada, Australia, New Zealand, Western Europe, the Soviet Bloc, and most of Latin America. The nays were the Arab and Muslin countries, Greece, Cuba, Chile, and India. Strangely, among the abstainers was Great Britain; perhaps motivated by allegiance to both the Arabs and the Jews. The acts of sabotage and terrorism in Palestine by the Jews against the British may have been a major contributing factor. As can well be imagined the lobbying by both the Arabs and the Jews in the months leading up to the vote was intense. Especially contested by both sides were Latin America and Asia.
North America, Western Europe, and the Soviet Bloc (that was to change a few years later) were firmly in the Jewish camp while Africa, a couple of Latin American countries and of course the Middle East sided with the Palestinian Arabs.
The Civil War between the Palestinian Arabs and Jews began in earnest on November 30, 1947. The Arab world called this the First Palestine War and the Jews called it the War of Independence. The war was to have two distinct phases: The civil war which began on November 30, 1947 and ended on May 14, 1948 and a conventional war beginning when the Arab armies of the surrounding states of Egypt, Iraq, Syria, and Jordan invaded Palestine on May 15, 1948 and ending with armistice agreements with the Arab countries (Egypt on February 24, 1949, Jordan on April 3, 1949, Syria on July 20, 1949. Iraq refused to enter into armistice negotiations). There were several temporary truces intermixed during this interval where both the Arab and Israeli sides tried to derive advantages.
After 5 ½ months of fighting the Palestinian Arabs, the Yishuv, as the Jewish community in Palestine called themselves, won a decisive victory. The Jewish leaders, headed by the homunculus in stature, but leviathan in achievement, David Ben-Gurion, went to Tele Aviv on May 14, 1948 and, to the roar of approval and celebration of the crowd, declared the establishment of the State of Israel. The United States immediately recognized this new state and was followed quickly by the Soviet Union.
Where did the Yishuv get its arms to fight the war? Though money (and volunteers mostly Jewish, but some non-Jews as well) poured in from various places around the world, a large percentage came from North America and Europe. Interestingly enough, initially the Skoda Arms Works in Czechoslovakia supplied much of the military hardware. The motivation for the Checks was hard currency rather than ideology. They also sold arms to the Arabs, but considerably fewer. Other sources were also utilized by Jewish arms buyers around the world. Some few hundreds of the Jewish officers and enlisted men gained military experience fighting for the British, Canadian, Australian, New Zealand, and American armed forces during WWII.
The Israelis were highly motivated to win this war because not to do so was to risk another Holocaust. The Arab soldiers from the other countries, on the other hand, knew that if they should lose they could always go back to their home countries. There are other factors which favored the Israelis. Not only were they more highly motivated, had superior coordination of their forces, and knew the terrain better than the invading Arabs armies, but the Israelis had one objective – to win. The various Arabs countries had a variety of objectives which were seldom conductive to defeating the Jews. Three of the Arab countries which invaded Palestine were kingdoms, Abdullah in Jordan, Farouk in Egypt, and Prince Abdul al-Llah who served as regent for the underage Faisal II in Iraq. Only Syria had an elected president, the nationalist Shukri al-Quwwatli, who had led the opposition to French rule after WWII. These Arab leaders were not as rabidly anti-Israel as the current leaders of those countries today. Although they opposed the partition of Palestine into Arab and Jewish states, of greater concern for them and their military commanders was their suspicion of the other invading Arab armies whom they thought were trying to carve up Palestine to their own advantage. Then, as now, the virulently anti-Israeli “Arab street” was a major factor which had to be taken under consideration else their regimes might be overthrown. Still this mistrust and reluctant or non-existent cooperation between the various governments and armies caused a significant diminution of battle effectiveness which accrued to the advantage of the Israelis. Not that the Jews did not have some divisions within their ranks, but they were not of the same magnitude as the Arabs. At the start of the civil war the main Jewish force was called the Haganah. A much smaller and more militant group was called the Irgun Zvai Luemi (IZL), also called the Irgun. After a showdown between forces of the Haganah and the IZL in one battle where both sides fired on one another, peace was made between them and the IZL was absorbed into the Haganah, thereafter called the Israel Defense Forces (IDF). Before the start of the first phase of the civil war when British forces were still in Palestine, Acts of sabotage and terrorism were committed by the Irgun against the British. The Haganah opposed the wanton acts of terrorism by the Irgun including murder of British military personnel and civilians. This situation was recounted in the 1960 movie Exodus based on the book of the same name by Leon Uris.
Professor Morris stated that Arab sources claim that 900,000 to one million Palestinian Arabs were displaced from their homes in Palestine. A better estimate might be on the order of 750,000 or approximately ½ of the Arab population before the war. Was there a deliberate and formulated policy by the Jews to expel the Arabs from Palestine? This charge has been made over the years, yet there is no credible evidence to support it. What is undeniably factual is that as the war went on, the Jews, both government officials and military commanders in the field, increasingly chose to expel the Arabs from their towns and settlements by direct orders or intimidation rather than trying to subjugate and control them, but leave them in place. The thinking of the Jews on this issue turned on the considerations that Arabs left in Jewish territory might become a “Fifth Column” to surreptitiously work against the Jewish occupiers. A further factor, strongly argued by Ben-Gurion, was that after the war if a sufficient number of Arabs remained in Israel then by demographics the Jews might become a minority and could conceivably lose control of their own country through the democratic process.
The other side of this logical, but tarnished nodus is the 500,000 to 600,000 Jews who emigrated, were intimidated into leaving, or were expelled from Arab lands in the years immediately after 1948. In Yemen 43,000 Jews left; in Iraq 80,000 to 90,000 who mostly went to Israel; in Syria the number was 15,000; in Libya it was 40,000; in Morocco 60,000 out of the pre-1948 total of 300,000 with a second major wave leaving in 1961 after the death of the sultan Mohammed V such that now there are only about 4000 Jews left in the country – still the largest Jewish community in the Arab world; and lesser numbers in Iran, Algeria and Tunisia. A number of Jews in these various countries did not leave – they were killed; hundreds in Iraq, 76 or so in Aden, 13 in Libya, and dozens more in other Arab countries. Everyone knows that hundreds of thousands of Palestinians became refugees after the 1948 war. What is not so well known, in fact hardly known at all, is that a half million or so Jews were forced, one way or another, to leave their home countries in the Middle East often being required to leave their money and personal property behind. Where is the outrage from the likes of Jimmy Carter, who is oh so sympathetic to the Palestinian Arab cause, but is silent on the injustices which were done to Jewish civilians in the Middle East after 1948?
Apart from being interesting history in itself, what is the significance of familiarity with the 1948 Arab/Israeli War? Factoring in the 1967 war (the so called “Six Day War”) between Israel and the trio of Egypt, Jordan, and Syria as well as the 1973 war (The Yom Kippur War) between Israel and the duo of Egypt and Syria there are lessons to be learned and hopefully profited from. The Arab world was humiliated in 1948, again in 1967, and to a lesser extent in 1973. Given the more than 1000 years of suspicion, rivalry, and contempt between Arabs and Jews and the establishment of Israel in the middle of the Arab world along with the aforementioned wars, what is there to be surprised about at the level of animosity and bitter hatred of Muslims toward Jews today? Another lesson from the 1948 war is the jealousy, distrust, and duplicity between the various Muslim or Arab countries and also within the countries themselves with their disparate social and religious (Sunni, Shiite, Coptic, Druze, Christian, etc.) makeup. Any country such as the United States or collection of countries, such as the UN or EU, who wants to “nation build” in the Middle East, should fully understand from a historical perspective what the difficulties, not to say impossibilities are. Bring peace between the Jews and Muslims just might take a thousand years or the complete destruction of one side or the other. Certainly the ill-feelings today between the two protagonists are greater than ever since the imbroglio of 1948.
There are criticisms and petty bickering among religious groups, e.g. Baptists, Methodists, Catholics, etc. in the United States and elsewhere , but I do not hear of them strapping on explosive vests and blowing themselves and others to kingdom come. Can the same be said of Muslin fanatics? Of course only a small minority of Muslims does this, yet the number of Muslims who do not unqualifiedly condemn these acts is not small. And even a minuscule number of people from other religions are not bent upon such extreme violence.
Unlike the civil war in Lebanon which started in 1975 and lasted for 15 years, the Palestinian War was definitely not a Black Swan – it was building for decades (see my blog essay Black Swans for an explanation of a Black Swan). Small pitched battles and clashes between Palestinian Arabs and Jews started in the decades of the late 19th century and continued sporadically into the 1910’s, 1920’s, 1930’s and late 1940’s.
One of the best histories of this 1948 war may be the 2008 book 1948 – A history of the First Arab-Israeli War by Benny Morris. Morris is a professor of history in the Middle East Studies Department of Ben Gurion University, Beersheba, Israel. One might presume a certain amount of bias on the part of Professor Morris, yet I did not perceive any. For example Morris states that the Jews committed more atrocities and massacres against the Arabs than did the Arabs against the Jews. The reason for this was logical in that the Jews overran many more Arab towns, villages, and settlements than vice-versa on the order of several hundred versus a couple dozen. None-the-less this is an indication to me that Professor Morris is a historian first and an Israeli second.
In 1958 when I was working in Libya, North Africa for Mobil Oil, I met several young Palestinian men in Tripoli who said that in 1948 their families were given 24 hours to leave their homes in Palestine. All were allowed to take as much of their personal and household effects as they could with them, but they had to leave. Their hatred of Palestinian Jews in particular and all Jews in general was palpable. As a child in June 1948 Lidia witnessed Jews in Tripoli being stoned by Arab mobs in reaction to the war between the Palestinian Arabs and Jews (according to Professor Morris 13 Jews were killed in Tripoli). At that time Libya was under United Nations jurisdiction with the British police and military on the ground as the UN representatives. The British did not intervene in the mayhem for 24 hours. What could have motivated the British for their non action? The answer must lie in what happened in Palestine prior to the 1948 war. Palestine was a British mandate so that the British were charged with administering the area and providing security. The Jews wanted the British military out of Palestine and toward the end of the mandate resorted to committing act of terrorism to drive them out. Among the terrorism acts was the bombing of the King David Hotel (July 1946) in Jerusalem where civilians as well as British military personnel were killed.
In 1948 the Jewish population of Palestine was circa 750,000 and the Arab population almost twice that. The surrounding Arab countries which went to war had a combined population of about 40 million. How on earth could such a relatively small population beat a so much larger one? And make no mistake; although the Jews lost a few battles, they overwhelmingly won the war. There are rational reasons why this was so as I shall endeavor to explain later, with no little credit to Professor Morris.
In 1881 the population of Palestine was made up of approximately 450,000 Arabs – 90% Muslim and the rest Christian and 25,000 Jews. From 1882 to 1903 the first wave of Zionist settlers – some 30,000 Jews came to Palestine. Zionism is an international political movement that supported the reestablishment of a homeland for the Jewish people in Palestine. The word Zionism was derived from Mount Zion, a mountain near Jerusalem. The Arabs were wary of these new Jewish settlers whom they regarded as inexplicable, foolish, strange infidels, and vaguely minatory. The Jews in turn thought the Arabs devious, dirty, untrustworthy, simple, and lazy. Nothing like two peoples getting off to a good start in the Holy Land. The mantra of the Zionists was, “A land without people for a people without land.” The Jewish settlers must have been blind if they did not notice there were plenty of people in the land already.
Until around 1908-09 there were few acts of violence except of the common criminal kind. In 1909, David Ben-Gurion, who would become the first president of Israel in May 1948, was waylaid by an Arab with a knife, bent on robbery. Ben-Gurion suffered a wound to his arm and an abiding suspicion of Arabs thereafter. From 1909-1914 violence increased and took on a more nationalistic fervor – that is a more Arab vs. Jew connotation. The 1st World War from 1914 to 1919 diminished the Arab-Jew confrontations as Palestine, then part of the Ottoman Empire, which in turn was part of the Central Powers, was allied with Germany and the Austro-Hungarian Empire as concentration on the wider war was the order of the day.
On November 29, 1947 the United Nations put Resolution 181, which called for the partition of Palestine into two sovereign states – one Jewish and one Arab, to a vote. When the tally was finished, 33 UN member countries voted “yes” and 13 voted “no” with 10 abstentions. The resolution barely achieved the necessary 2/3 vote with only two votes to spare. One of the two Palestinian protagonists was jubilant and the other was angry and morose. Guess which was which. The countries voting in the affirmative were the United States, Canada, Australia, New Zealand, Western Europe, the Soviet Bloc, and most of Latin America. The nays were the Arab and Muslin countries, Greece, Cuba, Chile, and India. Strangely, among the abstainers was Great Britain; perhaps motivated by allegiance to both the Arabs and the Jews. The acts of sabotage and terrorism in Palestine by the Jews against the British may have been a major contributing factor. As can well be imagined the lobbying by both the Arabs and the Jews in the months leading up to the vote was intense. Especially contested by both sides were Latin America and Asia.
North America, Western Europe, and the Soviet Bloc (that was to change a few years later) were firmly in the Jewish camp while Africa, a couple of Latin American countries and of course the Middle East sided with the Palestinian Arabs.
The Civil War between the Palestinian Arabs and Jews began in earnest on November 30, 1947. The Arab world called this the First Palestine War and the Jews called it the War of Independence. The war was to have two distinct phases: The civil war which began on November 30, 1947 and ended on May 14, 1948 and a conventional war beginning when the Arab armies of the surrounding states of Egypt, Iraq, Syria, and Jordan invaded Palestine on May 15, 1948 and ending with armistice agreements with the Arab countries (Egypt on February 24, 1949, Jordan on April 3, 1949, Syria on July 20, 1949. Iraq refused to enter into armistice negotiations). There were several temporary truces intermixed during this interval where both the Arab and Israeli sides tried to derive advantages.
After 5 ½ months of fighting the Palestinian Arabs, the Yishuv, as the Jewish community in Palestine called themselves, won a decisive victory. The Jewish leaders, headed by the homunculus in stature, but leviathan in achievement, David Ben-Gurion, went to Tele Aviv on May 14, 1948 and, to the roar of approval and celebration of the crowd, declared the establishment of the State of Israel. The United States immediately recognized this new state and was followed quickly by the Soviet Union.
Where did the Yishuv get its arms to fight the war? Though money (and volunteers mostly Jewish, but some non-Jews as well) poured in from various places around the world, a large percentage came from North America and Europe. Interestingly enough, initially the Skoda Arms Works in Czechoslovakia supplied much of the military hardware. The motivation for the Checks was hard currency rather than ideology. They also sold arms to the Arabs, but considerably fewer. Other sources were also utilized by Jewish arms buyers around the world. Some few hundreds of the Jewish officers and enlisted men gained military experience fighting for the British, Canadian, Australian, New Zealand, and American armed forces during WWII.
The Israelis were highly motivated to win this war because not to do so was to risk another Holocaust. The Arab soldiers from the other countries, on the other hand, knew that if they should lose they could always go back to their home countries. There are other factors which favored the Israelis. Not only were they more highly motivated, had superior coordination of their forces, and knew the terrain better than the invading Arabs armies, but the Israelis had one objective – to win. The various Arabs countries had a variety of objectives which were seldom conductive to defeating the Jews. Three of the Arab countries which invaded Palestine were kingdoms, Abdullah in Jordan, Farouk in Egypt, and Prince Abdul al-Llah who served as regent for the underage Faisal II in Iraq. Only Syria had an elected president, the nationalist Shukri al-Quwwatli, who had led the opposition to French rule after WWII. These Arab leaders were not as rabidly anti-Israel as the current leaders of those countries today. Although they opposed the partition of Palestine into Arab and Jewish states, of greater concern for them and their military commanders was their suspicion of the other invading Arab armies whom they thought were trying to carve up Palestine to their own advantage. Then, as now, the virulently anti-Israeli “Arab street” was a major factor which had to be taken under consideration else their regimes might be overthrown. Still this mistrust and reluctant or non-existent cooperation between the various governments and armies caused a significant diminution of battle effectiveness which accrued to the advantage of the Israelis. Not that the Jews did not have some divisions within their ranks, but they were not of the same magnitude as the Arabs. At the start of the civil war the main Jewish force was called the Haganah. A much smaller and more militant group was called the Irgun Zvai Luemi (IZL), also called the Irgun. After a showdown between forces of the Haganah and the IZL in one battle where both sides fired on one another, peace was made between them and the IZL was absorbed into the Haganah, thereafter called the Israel Defense Forces (IDF). Before the start of the first phase of the civil war when British forces were still in Palestine, Acts of sabotage and terrorism were committed by the Irgun against the British. The Haganah opposed the wanton acts of terrorism by the Irgun including murder of British military personnel and civilians. This situation was recounted in the 1960 movie Exodus based on the book of the same name by Leon Uris.
Professor Morris stated that Arab sources claim that 900,000 to one million Palestinian Arabs were displaced from their homes in Palestine. A better estimate might be on the order of 750,000 or approximately ½ of the Arab population before the war. Was there a deliberate and formulated policy by the Jews to expel the Arabs from Palestine? This charge has been made over the years, yet there is no credible evidence to support it. What is undeniably factual is that as the war went on, the Jews, both government officials and military commanders in the field, increasingly chose to expel the Arabs from their towns and settlements by direct orders or intimidation rather than trying to subjugate and control them, but leave them in place. The thinking of the Jews on this issue turned on the considerations that Arabs left in Jewish territory might become a “Fifth Column” to surreptitiously work against the Jewish occupiers. A further factor, strongly argued by Ben-Gurion, was that after the war if a sufficient number of Arabs remained in Israel then by demographics the Jews might become a minority and could conceivably lose control of their own country through the democratic process.
The other side of this logical, but tarnished nodus is the 500,000 to 600,000 Jews who emigrated, were intimidated into leaving, or were expelled from Arab lands in the years immediately after 1948. In Yemen 43,000 Jews left; in Iraq 80,000 to 90,000 who mostly went to Israel; in Syria the number was 15,000; in Libya it was 40,000; in Morocco 60,000 out of the pre-1948 total of 300,000 with a second major wave leaving in 1961 after the death of the sultan Mohammed V such that now there are only about 4000 Jews left in the country – still the largest Jewish community in the Arab world; and lesser numbers in Iran, Algeria and Tunisia. A number of Jews in these various countries did not leave – they were killed; hundreds in Iraq, 76 or so in Aden, 13 in Libya, and dozens more in other Arab countries. Everyone knows that hundreds of thousands of Palestinians became refugees after the 1948 war. What is not so well known, in fact hardly known at all, is that a half million or so Jews were forced, one way or another, to leave their home countries in the Middle East often being required to leave their money and personal property behind. Where is the outrage from the likes of Jimmy Carter, who is oh so sympathetic to the Palestinian Arab cause, but is silent on the injustices which were done to Jewish civilians in the Middle East after 1948?
Apart from being interesting history in itself, what is the significance of familiarity with the 1948 Arab/Israeli War? Factoring in the 1967 war (the so called “Six Day War”) between Israel and the trio of Egypt, Jordan, and Syria as well as the 1973 war (The Yom Kippur War) between Israel and the duo of Egypt and Syria there are lessons to be learned and hopefully profited from. The Arab world was humiliated in 1948, again in 1967, and to a lesser extent in 1973. Given the more than 1000 years of suspicion, rivalry, and contempt between Arabs and Jews and the establishment of Israel in the middle of the Arab world along with the aforementioned wars, what is there to be surprised about at the level of animosity and bitter hatred of Muslims toward Jews today? Another lesson from the 1948 war is the jealousy, distrust, and duplicity between the various Muslim or Arab countries and also within the countries themselves with their disparate social and religious (Sunni, Shiite, Coptic, Druze, Christian, etc.) makeup. Any country such as the United States or collection of countries, such as the UN or EU, who wants to “nation build” in the Middle East, should fully understand from a historical perspective what the difficulties, not to say impossibilities are. Bring peace between the Jews and Muslims just might take a thousand years or the complete destruction of one side or the other. Certainly the ill-feelings today between the two protagonists are greater than ever since the imbroglio of 1948.
There are criticisms and petty bickering among religious groups, e.g. Baptists, Methodists, Catholics, etc. in the United States and elsewhere , but I do not hear of them strapping on explosive vests and blowing themselves and others to kingdom come. Can the same be said of Muslin fanatics? Of course only a small minority of Muslims does this, yet the number of Muslims who do not unqualifiedly condemn these acts is not small. And even a minuscule number of people from other religions are not bent upon such extreme violence.
Friday, September 26, 2008
THE BANKING AND FINANCIAL CRISIS - REDUX 48
In my essay, The Banking and Financial Crisis, I blamed the officials in the financial institutions and both political parties. If the impression I gave was that Democrats and Republicans should be equally blamed, then consider the following facts in contemplating who is more culpable:
In 2001, Bush’s chief economist, N. Gregory Mankiw, warned that the government’s “implicit subsidy” of Freddie Mac and Fannie Mae, combined with loans to unqualified borrowers, was creating a huge risk for the entire financial system. Barney Frank (D-MA) denounced Mankiw, saying he had no “concern about housing.” The New York Times reported that Fannie Mae and Freddie Mac were “under heavy assault by the Republicans,” but these entities still had “important political allies in the Democrats.”
April 2001 – The 2002 budget request by the Bush Administration said that the size of Freddie Mac (FHLMC) and Fannie Mae (FNMA) was a “potential problem.” “Financial trouble in either could cause strong repercussions in financial markets.”
2003 – The Bush administration upgraded its warning to: “Systemic risk could spread beyond the housing sector.”
Sept. 2003 – The Bush administration pushed Congress hard to create a new federal agency to regulate and supervise FHLMC & FNMA. Barney Frank pushed back saying, “Freddie Mac and Fannie Mae are not in a crisis. The federal government should be doing more to get more low-income families in houses. Too many people have a sky is falling mentality which I do not see.” The legislation was blocked.
Feb. 2005 – Federal Reserve chief Allen Greenspan testified before Congress after officials at FHLMC & FNMA admitted there were accounting screw-ups: “Enabling these institutions to increase in size – and they will once this crisis, in their judgment, [has] passed, [is] placing the total financial system of the future at a substantial risk.”
April 2005 – Allen Greenspan: “If we fail to strengthen GSE [Government Sponsors of Enterprises] regulation we increase the possibility of insolvency and crisis.”
April 2005 – Senator Charles Schumer (D-NY): “I think Freddie Mac and Fannie Mae over the years have done an incredible job and are an intrinsic part of making America the best housed people in the world. If you look over the last 20 or whatever years, they have done a very, very good job.”
John McCain (R-AZ) in 2006 co-sponsored a bill in the Senate: “For years I have been concerned about the regulatory structure that governs Freddie Mac and Fannie Mae …. and the sheer magnitude of these companies and the role they play in the housing market. They need to be reformed without delay.” All of the Democrats voted against this bill in committee so the Republicans, fearing they could not get it passed, did not submit it to the full senate. Obama did not weigh in on it.
During the Clinton administration, the federal government put pressure on banks to grant more mortgages to the poor and minorities. Clinton’s Secretary of Housing and Urban Development, Andrew Cuomo, investigated Fannie Mae for racial discrimination and proposed that 50% of Fannie Mae and Freddie Mac’s portfolio be made up of loans to low-to-moderate-income borrowers by the year 2001. Threatening lawsuits, the Federal Reserve during the Clinton administration demanded that banks treat welfare payments and unemployment benefits as valid income sources to qualify for a mortgage.
There is also an accounting rule used now, which was not in force during the Savings and Loan scandal that would have worsened that financial crisis and which did not cause, but has exacerbated this one. The rule is this: financial institutions are forced to value the mortgages they hold at their current value rather than their long term value or even the amount of money these mortgages generate. Financial institutions typically loan 10 times as much money as the value of their capital. Therefore, if a financial institution such as a bank or a mortgage company is forced to write down say $10 billion worth of their capital due to the short term fall of their real estate holdings then their ability to give loans will be reduced by $100 billion. The Security and Exchange Commission (SEC) could change this requirement immediately.
In 2001, Bush’s chief economist, N. Gregory Mankiw, warned that the government’s “implicit subsidy” of Freddie Mac and Fannie Mae, combined with loans to unqualified borrowers, was creating a huge risk for the entire financial system. Barney Frank (D-MA) denounced Mankiw, saying he had no “concern about housing.” The New York Times reported that Fannie Mae and Freddie Mac were “under heavy assault by the Republicans,” but these entities still had “important political allies in the Democrats.”
April 2001 – The 2002 budget request by the Bush Administration said that the size of Freddie Mac (FHLMC) and Fannie Mae (FNMA) was a “potential problem.” “Financial trouble in either could cause strong repercussions in financial markets.”
2003 – The Bush administration upgraded its warning to: “Systemic risk could spread beyond the housing sector.”
Sept. 2003 – The Bush administration pushed Congress hard to create a new federal agency to regulate and supervise FHLMC & FNMA. Barney Frank pushed back saying, “Freddie Mac and Fannie Mae are not in a crisis. The federal government should be doing more to get more low-income families in houses. Too many people have a sky is falling mentality which I do not see.” The legislation was blocked.
Feb. 2005 – Federal Reserve chief Allen Greenspan testified before Congress after officials at FHLMC & FNMA admitted there were accounting screw-ups: “Enabling these institutions to increase in size – and they will once this crisis, in their judgment, [has] passed, [is] placing the total financial system of the future at a substantial risk.”
April 2005 – Allen Greenspan: “If we fail to strengthen GSE [Government Sponsors of Enterprises] regulation we increase the possibility of insolvency and crisis.”
April 2005 – Senator Charles Schumer (D-NY): “I think Freddie Mac and Fannie Mae over the years have done an incredible job and are an intrinsic part of making America the best housed people in the world. If you look over the last 20 or whatever years, they have done a very, very good job.”
John McCain (R-AZ) in 2006 co-sponsored a bill in the Senate: “For years I have been concerned about the regulatory structure that governs Freddie Mac and Fannie Mae …. and the sheer magnitude of these companies and the role they play in the housing market. They need to be reformed without delay.” All of the Democrats voted against this bill in committee so the Republicans, fearing they could not get it passed, did not submit it to the full senate. Obama did not weigh in on it.
During the Clinton administration, the federal government put pressure on banks to grant more mortgages to the poor and minorities. Clinton’s Secretary of Housing and Urban Development, Andrew Cuomo, investigated Fannie Mae for racial discrimination and proposed that 50% of Fannie Mae and Freddie Mac’s portfolio be made up of loans to low-to-moderate-income borrowers by the year 2001. Threatening lawsuits, the Federal Reserve during the Clinton administration demanded that banks treat welfare payments and unemployment benefits as valid income sources to qualify for a mortgage.
There is also an accounting rule used now, which was not in force during the Savings and Loan scandal that would have worsened that financial crisis and which did not cause, but has exacerbated this one. The rule is this: financial institutions are forced to value the mortgages they hold at their current value rather than their long term value or even the amount of money these mortgages generate. Financial institutions typically loan 10 times as much money as the value of their capital. Therefore, if a financial institution such as a bank or a mortgage company is forced to write down say $10 billion worth of their capital due to the short term fall of their real estate holdings then their ability to give loans will be reduced by $100 billion. The Security and Exchange Commission (SEC) could change this requirement immediately.
Friday, September 19, 2008
THE BANKING AND FINANCIAL CRISIS 47
What caused the current banking and financial crisis? Who is principally to blame, what is the best way to correct it, and should there be more government intervention and regulation or less? These are complex questions where only the politically biased with their paralogistic reasoning have simple answers. Before I attempt to expound on this, a history review is in order.
Every time there is a financial crisis, to some it is a new day. In fact it is history repeating itself in a new guise. It is widely believed that when the Great Depression descended upon the country, as well as much of the world, President Hoover did nothing while President Franklin Delano Roosevelt, when he came into office, brought the country out of the depression with massive government intervention and myriad federal programs. A review of the data does not support this belief. Hoover used the federal government to try to correct the situation without success. He actually made the economic depression worst by, among other schemes, pushing for and signing the Smoot-Hawley Tariff Act, which more accurately could be called the Hoover-Smoot-Hawley Act. This Act greatly restricted imports to America to protect American producers. Of course other countries retaliated so world trade was reduced thereby further slowing economic activity.
What is the evidence that the federal programs of Roosevelt did not bring the country out of the depression? Consider: The United States unemployment rate was 16% in 1931 and 19% in 1938, after nine years of the New Deal – three under Hoover and six under Roosevelt. The unemployment rate in 1929 just prior to the stock market crash was 3.2%. There was an intensifying of the recession in 1937. The stock market went into a nosedive and by November 1937 unemployment had soared to 11 million with another 3 million working only part time. Statistics showed that the United States was lagging far behind other countries in recovering from the depression. American national income in 1937 was 86% of the 1929 high water mark while Great Britain’s was 124%. Japan’s employment figure was 75% above the 1929 number. Chile, Sweden, and Australia had economic growth rates in the range of 20% compared to the United States’ dismal -7%.
In the late 1980’s there was the Savings & Loan scandal. Then in 2000-2002 the high tech bubble burst causing the NASDAQ index to go from more than 5000 to around 1000. The early 2000’s was the era of the brigands of Enron, WorldCom, Global Crossing, Arkadelphia, et.al. Now is the time of the banking and financial institutions meltdown. Do you get the idea that these crises reoccur, but with different sectors of the economy? Does anyone want to bet this pattern will not happen in the future?
Who are the bad actors in this current climacteric of many of the banking and financial institutions? Let us start with the officials at Freddie Mac (FHLMC) and Fannie Mae (FNMA). Franklin Raines, currently an advisor to Barack Obama, was the CEO of FNMA from 1999 to 2004 when guaranteeing of mortgages and other real estate loans given without down payments and weak financial backgrounds to home buyers and investors was getting underway. Later it got even more irresponsible when paperwork was not required for many of these loan recipients. During his six year tenure at FNMA, Raines took home $90 million. Jim Johnson was CEO of FNMA before Raines and made $21 million in his shorter tenure. When he retired in 1998 he got a $600,000 per year consulting contract. This clown who also is an Obama advisor and headed Obama’s vice-presidential search committee worked at Lehman Brothers.
Another Scaramouch is the infamous Jamie Gorelick. Remember her? She was Deputy Attorney General under Janet Reno. In that position Gorelick was primarily responsible for maintaining and strengthening the wall of separation between the CIA and the FBI. To say the least it did not help to prevent, if it had been possible, 9/11. In 1978 Sen. Frank Church (D-ID) was the driving force behind the passage of the Foreign Surveillance Act which set up this wall between the CIA and FBI. As with all such actions, the intent was good, but the country paid for it later. At any rate, Gorelick was appointed to the bipartisan 9/11 Commission (set up in November 2002) by then senate Majority Leader Tom Daschle. Daschle and the Democrats wanted Gorelick on the commission so she could not be subpoenaed to testify before the commission on her role in handicapping the FBI and CIA. In the spirit of bipartisanship the Republicans stupidly went along with Daschle.
Gorelick was vice-chairman of FNMA from 1997 to 2003 and collected $26 million during that time. All of these people were appointed by President Bill Clinton. Before Republicans start to say “see it is all the fault of the Democrats” I would opine that the current crew at FHLMC & FNMA were appointed by Bush and did not seem to be any more aware or competent than their Democrat predecessors.
There are more scoundrels. Sen. Christopher J. Dodd (D-CT) is the chairman of the banking committee in the senate. What did he do to try to forestall this banking problem? Nothing that I can discern. Rep. Barnett (Barney) Frank (D-MA), who strangely or maybe not is unmarried, is chairman of the Financial Services Committee. What did he do? Again the answer is nothing – in fact in both cases it is less than nothing. Dodd received more political contributions from FHLMC/FNMA than anyone in congress. Obama was third on the list of most contributions.
Carl Rove said that the Bush administration tried to get laws passed to reform the banks and financial institutions, but was stymied by the Democrats in congress and especially Frank and Dodd. While there is no reason to disbelieve Rove, the president has a bully pulpit (as expressed by Teddy Roosevelt) so he could have done what Ronald Reagan would sometimes do, that is, go over the head of congress directly to the people. Fact is that at one time even Bush bragged about how many Americans owned their homes. As it turned out, the problem was that too many of these people didn’t really own their homes; the banks did much to the chagrin of both nominal home owners and the banks. Suppose that the Bush administration and Republicans in congress had insisted that these credit institutions not allow people with bad credit history and few assets or poor income prospects to obtain mortgages. What do you think the reaction would have been from the Democrats in congress and the Main Stream Media as well? How about something along the lines of “There the Republicans, the party of the rich, go again in favoring the wealthy and discriminating against the poor.” Before the crisis occurred and especially if it had then been averted, what defense could the Republicans have used? It would have been impossible to prove that a financial crisis would have happened but for the prudent policy of the GOP.
My purpose in discussing the Great Depression was to issue a cautionary note about assuming that more government regulation and involvement in this banking and financial situation will be the denouement. It goes back to the warning by President Eisenhower at the end of his 2nd term about the military-industrial complex. Money corrupts the system such that government regulators are co-opted by the industries they are supposed to regulate. Even if there is honest regulation that does not mean the problems will be ameliorated.
The solution for this current financial mess by both major political parties as well as the overwhelming majority of Americans is for more federal government oversight and control. That has not worked well in the past so why should one expect it to work now? What then to do? Clearly at this point there has to be government intervention via financial bailouts to keep the credit and equity markets from truly collapsing. When this crisis is over and before the next one occurs, as it surely will, there should be a firm commitment by the federal government to yes, enforce existing laws by convicting greedy and culpable corporate and political knaves and prevent collusion between institutions, but to generally maintain a hands off position from private enterprises. To quote economist Walter Williams in a recent column who quoted English philosopher Herbert Spencer: "The ultimate result of shielding men from the effects of folly is to fill the world with fools."
Every time there is a financial crisis, to some it is a new day. In fact it is history repeating itself in a new guise. It is widely believed that when the Great Depression descended upon the country, as well as much of the world, President Hoover did nothing while President Franklin Delano Roosevelt, when he came into office, brought the country out of the depression with massive government intervention and myriad federal programs. A review of the data does not support this belief. Hoover used the federal government to try to correct the situation without success. He actually made the economic depression worst by, among other schemes, pushing for and signing the Smoot-Hawley Tariff Act, which more accurately could be called the Hoover-Smoot-Hawley Act. This Act greatly restricted imports to America to protect American producers. Of course other countries retaliated so world trade was reduced thereby further slowing economic activity.
What is the evidence that the federal programs of Roosevelt did not bring the country out of the depression? Consider: The United States unemployment rate was 16% in 1931 and 19% in 1938, after nine years of the New Deal – three under Hoover and six under Roosevelt. The unemployment rate in 1929 just prior to the stock market crash was 3.2%. There was an intensifying of the recession in 1937. The stock market went into a nosedive and by November 1937 unemployment had soared to 11 million with another 3 million working only part time. Statistics showed that the United States was lagging far behind other countries in recovering from the depression. American national income in 1937 was 86% of the 1929 high water mark while Great Britain’s was 124%. Japan’s employment figure was 75% above the 1929 number. Chile, Sweden, and Australia had economic growth rates in the range of 20% compared to the United States’ dismal -7%.
In the late 1980’s there was the Savings & Loan scandal. Then in 2000-2002 the high tech bubble burst causing the NASDAQ index to go from more than 5000 to around 1000. The early 2000’s was the era of the brigands of Enron, WorldCom, Global Crossing, Arkadelphia, et.al. Now is the time of the banking and financial institutions meltdown. Do you get the idea that these crises reoccur, but with different sectors of the economy? Does anyone want to bet this pattern will not happen in the future?
Who are the bad actors in this current climacteric of many of the banking and financial institutions? Let us start with the officials at Freddie Mac (FHLMC) and Fannie Mae (FNMA). Franklin Raines, currently an advisor to Barack Obama, was the CEO of FNMA from 1999 to 2004 when guaranteeing of mortgages and other real estate loans given without down payments and weak financial backgrounds to home buyers and investors was getting underway. Later it got even more irresponsible when paperwork was not required for many of these loan recipients. During his six year tenure at FNMA, Raines took home $90 million. Jim Johnson was CEO of FNMA before Raines and made $21 million in his shorter tenure. When he retired in 1998 he got a $600,000 per year consulting contract. This clown who also is an Obama advisor and headed Obama’s vice-presidential search committee worked at Lehman Brothers.
Another Scaramouch is the infamous Jamie Gorelick. Remember her? She was Deputy Attorney General under Janet Reno. In that position Gorelick was primarily responsible for maintaining and strengthening the wall of separation between the CIA and the FBI. To say the least it did not help to prevent, if it had been possible, 9/11. In 1978 Sen. Frank Church (D-ID) was the driving force behind the passage of the Foreign Surveillance Act which set up this wall between the CIA and FBI. As with all such actions, the intent was good, but the country paid for it later. At any rate, Gorelick was appointed to the bipartisan 9/11 Commission (set up in November 2002) by then senate Majority Leader Tom Daschle. Daschle and the Democrats wanted Gorelick on the commission so she could not be subpoenaed to testify before the commission on her role in handicapping the FBI and CIA. In the spirit of bipartisanship the Republicans stupidly went along with Daschle.
Gorelick was vice-chairman of FNMA from 1997 to 2003 and collected $26 million during that time. All of these people were appointed by President Bill Clinton. Before Republicans start to say “see it is all the fault of the Democrats” I would opine that the current crew at FHLMC & FNMA were appointed by Bush and did not seem to be any more aware or competent than their Democrat predecessors.
There are more scoundrels. Sen. Christopher J. Dodd (D-CT) is the chairman of the banking committee in the senate. What did he do to try to forestall this banking problem? Nothing that I can discern. Rep. Barnett (Barney) Frank (D-MA), who strangely or maybe not is unmarried, is chairman of the Financial Services Committee. What did he do? Again the answer is nothing – in fact in both cases it is less than nothing. Dodd received more political contributions from FHLMC/FNMA than anyone in congress. Obama was third on the list of most contributions.
Carl Rove said that the Bush administration tried to get laws passed to reform the banks and financial institutions, but was stymied by the Democrats in congress and especially Frank and Dodd. While there is no reason to disbelieve Rove, the president has a bully pulpit (as expressed by Teddy Roosevelt) so he could have done what Ronald Reagan would sometimes do, that is, go over the head of congress directly to the people. Fact is that at one time even Bush bragged about how many Americans owned their homes. As it turned out, the problem was that too many of these people didn’t really own their homes; the banks did much to the chagrin of both nominal home owners and the banks. Suppose that the Bush administration and Republicans in congress had insisted that these credit institutions not allow people with bad credit history and few assets or poor income prospects to obtain mortgages. What do you think the reaction would have been from the Democrats in congress and the Main Stream Media as well? How about something along the lines of “There the Republicans, the party of the rich, go again in favoring the wealthy and discriminating against the poor.” Before the crisis occurred and especially if it had then been averted, what defense could the Republicans have used? It would have been impossible to prove that a financial crisis would have happened but for the prudent policy of the GOP.
My purpose in discussing the Great Depression was to issue a cautionary note about assuming that more government regulation and involvement in this banking and financial situation will be the denouement. It goes back to the warning by President Eisenhower at the end of his 2nd term about the military-industrial complex. Money corrupts the system such that government regulators are co-opted by the industries they are supposed to regulate. Even if there is honest regulation that does not mean the problems will be ameliorated.
The solution for this current financial mess by both major political parties as well as the overwhelming majority of Americans is for more federal government oversight and control. That has not worked well in the past so why should one expect it to work now? What then to do? Clearly at this point there has to be government intervention via financial bailouts to keep the credit and equity markets from truly collapsing. When this crisis is over and before the next one occurs, as it surely will, there should be a firm commitment by the federal government to yes, enforce existing laws by convicting greedy and culpable corporate and political knaves and prevent collusion between institutions, but to generally maintain a hands off position from private enterprises. To quote economist Walter Williams in a recent column who quoted English philosopher Herbert Spencer: "The ultimate result of shielding men from the effects of folly is to fill the world with fools."
Monday, March 17, 2008
A VULTURE’S TALE 46
In 2005 vultures in the form of trial lawyers not only circled, but drew a beady eye on their prey, drug company Merck, the makers of Vioxx. In the Dallas Morning News ads from law firms exhorting victims of Vioxx to contact them appeared and one even offered a free medical/legal seminar in case Vioxx patients needed coaching to formulate their maladies. This process was repeated in newspapers all across this broad land - and on television and the internet as well.
A dozen nonsteroidal anti-inflammatory drugs (NSAIDs) are available by prescription with the best known, because of extensive advertising, being Vioxx (rofecoxib) and Celebrex (celecoxib). Over-the-counter NSAID medications include aspirin (Bayer & Ecotrin), ibuprofen (Advil & Motrin), and naproxen (Aleve). Acetaminophen (Tylenol) is not technically an NSAID, but is considered an analgesic (pain reliever).
Why are these drugs called “nonsteroidal” and “anti-inflammatory?” Because they are not steroids which treat inflammation by suppressing the immune system; rather they inhibit the body’s ability to synthesize prostaglandins (fatty acids) which contribute to inflammation, pain, muscle cramps, and fever.
The main inflammatory diseases which are treated with these drugs are osteoarthritis (a degenerative joint disease) and rheumatoid arthritis (an autoimmune disease). Of the people who are treated for these diseases in the United States, circa 60% are women and 40% men. Rheumatoid arthritis occurs in about 1% of the U.S.A. population and is three times more prevalent in women than men. Perhaps some consolation for women can be extracted from knowing that a secondary disease, gout, which is treated with NSAIDs, mostly afflicts men.
Essentially what are the differences between the prescription and over-the-counter drugs used to treat arthritis? The answers are drug strength and price. To equal the potency of one tablet of one of the prescription drugs a person would have to take several of the over-the-counter drugs. An increased risk of heart attack or stroke seems to occur with long term (years or at least many months) use of either prescription or over-the-counter drugs.
Whether a person takes one of the prescription or several over-the-counter pills daily, long term, the health risks are the same. Therein lays the artificiality of the liability claims against Vioxx. Given that hundreds of millions of people in this country have taken aspirin or ibuprofen or naproxen over the many decades (aspirin has been around for more than 100 years) these drugs have been available it is practically a certainty there are and have been many people who have taken large doses for years and have suffered increased mortality or disability from heart attacks or strokes yet how many lawsuits have resulted? None that I know of – at least none that were successful. Perhaps Merck can be faulted for not making public sooner the measured long term risk of Vioxx. It appears that although the long term risk of Vioxx is low, it is twice the risk of people not taking the drug. Still who possesses such naiveté as not to believe that the birds-of-prey (lawyers) would not swoop down in a frenetic feeding fury even if Merck had been timelier in its disclosure?
It is interesting that in a speech during the 2004 presidential political campaign, the world renowned homeopathic physician Dr. Teresa Heinz-Kerry of Mozambique weighed in on the issue of treating osteoarthritis by the use of gin & raisins. Her formula, dating back to the era of old wives tales, is to soak nine white raisins (only white raisins; dark raisins simply will not do – even for an African) in a large glass of gin for two weeks then throw away the raisins and gulp down the gin or some such procedure. We should all take comfort in the knowledge that such an ingénue as Mrs. Heinz-Kerry is in the forefront of our political, social, scientific, and medical life.
As an aside, the reason for the past shortages of influenza vaccine can be largely attributable to these aforementioned rapacious trial lawyers of which Sen. John Edwards is an archetypical example. John Kerry even had the temerity to launch a jeremiad against George Bush, blaming him for the then flu vaccine shortage. If Kerry wants to assign culpability for the lack of flu vaccine he would do well to look at his partner in crime the egregiously greedy Johnny Edwards who compiled his fortune by foisting junk science arguments on gullible juries.
A generation ago there were a dozen pharmaceutical companies in the United States making flu vaccine – today there are only two or three. Why? The answer is tied up in the concept of capitalism. Manufacturing flu vaccine was never a highly profitable enterprise in the first place then when lawsuits were filed because there are always some bad reactions in any medical intervention the companies logically decided just to get out of the business.
For the uninformed who believe the answer to this problem is to have the federal government produce flu vaccines I would suggest the following: I made five trips to the old Soviet Union in 1990-91 and I saw what a socialist society wrought in the sphere of economics. They were a half century behind us in all sorts of consumer products and services and the people I talked to knew it. So for those Americans who would opt for government medical services I would paraphrase the words of John F. Kennedy from a speech on June 26, 1963 in West Berlin if it were possible to go backwards in time: “Let them come to the Soviet Union!”
A dozen nonsteroidal anti-inflammatory drugs (NSAIDs) are available by prescription with the best known, because of extensive advertising, being Vioxx (rofecoxib) and Celebrex (celecoxib). Over-the-counter NSAID medications include aspirin (Bayer & Ecotrin), ibuprofen (Advil & Motrin), and naproxen (Aleve). Acetaminophen (Tylenol) is not technically an NSAID, but is considered an analgesic (pain reliever).
Why are these drugs called “nonsteroidal” and “anti-inflammatory?” Because they are not steroids which treat inflammation by suppressing the immune system; rather they inhibit the body’s ability to synthesize prostaglandins (fatty acids) which contribute to inflammation, pain, muscle cramps, and fever.
The main inflammatory diseases which are treated with these drugs are osteoarthritis (a degenerative joint disease) and rheumatoid arthritis (an autoimmune disease). Of the people who are treated for these diseases in the United States, circa 60% are women and 40% men. Rheumatoid arthritis occurs in about 1% of the U.S.A. population and is three times more prevalent in women than men. Perhaps some consolation for women can be extracted from knowing that a secondary disease, gout, which is treated with NSAIDs, mostly afflicts men.
Essentially what are the differences between the prescription and over-the-counter drugs used to treat arthritis? The answers are drug strength and price. To equal the potency of one tablet of one of the prescription drugs a person would have to take several of the over-the-counter drugs. An increased risk of heart attack or stroke seems to occur with long term (years or at least many months) use of either prescription or over-the-counter drugs.
Whether a person takes one of the prescription or several over-the-counter pills daily, long term, the health risks are the same. Therein lays the artificiality of the liability claims against Vioxx. Given that hundreds of millions of people in this country have taken aspirin or ibuprofen or naproxen over the many decades (aspirin has been around for more than 100 years) these drugs have been available it is practically a certainty there are and have been many people who have taken large doses for years and have suffered increased mortality or disability from heart attacks or strokes yet how many lawsuits have resulted? None that I know of – at least none that were successful. Perhaps Merck can be faulted for not making public sooner the measured long term risk of Vioxx. It appears that although the long term risk of Vioxx is low, it is twice the risk of people not taking the drug. Still who possesses such naiveté as not to believe that the birds-of-prey (lawyers) would not swoop down in a frenetic feeding fury even if Merck had been timelier in its disclosure?
It is interesting that in a speech during the 2004 presidential political campaign, the world renowned homeopathic physician Dr. Teresa Heinz-Kerry of Mozambique weighed in on the issue of treating osteoarthritis by the use of gin & raisins. Her formula, dating back to the era of old wives tales, is to soak nine white raisins (only white raisins; dark raisins simply will not do – even for an African) in a large glass of gin for two weeks then throw away the raisins and gulp down the gin or some such procedure. We should all take comfort in the knowledge that such an ingénue as Mrs. Heinz-Kerry is in the forefront of our political, social, scientific, and medical life.
As an aside, the reason for the past shortages of influenza vaccine can be largely attributable to these aforementioned rapacious trial lawyers of which Sen. John Edwards is an archetypical example. John Kerry even had the temerity to launch a jeremiad against George Bush, blaming him for the then flu vaccine shortage. If Kerry wants to assign culpability for the lack of flu vaccine he would do well to look at his partner in crime the egregiously greedy Johnny Edwards who compiled his fortune by foisting junk science arguments on gullible juries.
A generation ago there were a dozen pharmaceutical companies in the United States making flu vaccine – today there are only two or three. Why? The answer is tied up in the concept of capitalism. Manufacturing flu vaccine was never a highly profitable enterprise in the first place then when lawsuits were filed because there are always some bad reactions in any medical intervention the companies logically decided just to get out of the business.
For the uninformed who believe the answer to this problem is to have the federal government produce flu vaccines I would suggest the following: I made five trips to the old Soviet Union in 1990-91 and I saw what a socialist society wrought in the sphere of economics. They were a half century behind us in all sorts of consumer products and services and the people I talked to knew it. So for those Americans who would opt for government medical services I would paraphrase the words of John F. Kennedy from a speech on June 26, 1963 in West Berlin if it were possible to go backwards in time: “Let them come to the Soviet Union!”
Monday, February 11, 2008
CALIFORNIA DREAMIN – OR IS THIS A NIGHTMARE? 45
In his 2007 book What’s the Matter with California? Jack Cashill (author of the 2005 book Hoodwinked: How Intellectual Hucksters Have Hijacked American Culture – see my essay Fools, Fakes & Frauds #15) has laid out an illuminating exposé of the modern incarnation of the Golden State. Kansan Cashill states that if someone from Kansas is asked what is the matter with Kansas the usual reply is: Why, is there something wrong with Kansas? If someone from California is asked what is the matter with California the common reply is: How much time do you have?
Do you know there is a parallel between the two Californians, O.J. Simpson and John Walker Lindh (the American Taliban)? One is black and the other is white, so that is not it. Both of their fathers divorced their mothers and left their families without any financial or social support. Unfortunately not too unusual, especially in California. What is a bit bizarre, even for California, is that they both left their wives and families and took up with another man. So far as I know John Walker Lindh’s father is still alive while O.J. Simpson’s father died from AIDS (Acquired Immune Deficiency Syndrome) or more correctly medically since people do not die directly from AIDS, he died because of an opportunistic disease brought on by a greatly compromised immune system. Still think California is not a bit weird? Read on.
In California, 1969 was a seminal year. It was the year the Crips gang was formed; the Tate – La Bianca murders by the Manson mob; and no fault divorce was passed. The prison population in California increased from 23,264 to 168,035 in the 25 years from 1969 to 1994. Was there a link between this much bigger incarceration increase than the population increase of the state and no fault divorce? The answer is an unqualified yes as I will justify later. For the moment consider that in 1970, the first full year of no fault divorce, the numbers of divorces was a record 112,942, a 38% increase from 1969 and was 60% higher than the nation as a whole. By 1980 California registered a new record 138,361 divorces which was more than twice as many as in 1966. What was the response of the politicians in California to the embarrassment of this accelerated divorce rate? Why, they simply stopped keeping or publishing statistics on divorce! Well, that would certainly ameliorate the problem of excessive divorces.
As related by Cashill, PBS (the Public Broadcasting System) weighed in on the issue in 1999 with their program Sesame Street. In it, Kermit the Frog, as an inquiring reporter, asks one little bird where she lives. The perky baby bird coos that she lives part of the time in a nest in a tree with her mother and the rest of the time in another nest with her father. She cheerfully explains that they both love her. What PBS doesn’t explain is that this potentially traumatic and unnatural situation might cause some of the little birds to behave badly and a few to become sociopaths the way their human counterparts do. A mere trifle in the grand scheme of things PBS might rationalize.
Californian Susan Atkins’ mother died when Susan was 10 or 11 years old. Her father was a functional alcoholic when his wife was alive and a dysfunctional alcoholic when she died. This left Susan Atkins on her own when she was 15 years old and as a result she easily became emotionally dependent upon and under the spell of the malevolent Charles Manson. The story is similar for the other three people, Linda Kasabian, Patricia Krenwinkel, and Tex Watson, who Manson dispatched to carry out the bloody business of the Tate – La Bianca murders as well as the 15 or so other young people, mostly women, who were lured into the Manson fold.
Charles “Charlie” Manson was a murderous monster – the very epitome of evil. Even far left loons might concede that he was worse than Joe McCarthy; or maybe not. Although he possibly was born a psychopath, Manson’s family background sure did not help his social development. Manson was born to an unwed mother. For a short time after his birth she was married to a laborer named William Manson. He never knew his biological father. His mother, a heavy drinker, once sold him to a childless waitress for a pitcher of beer. His uncle retrieved him a few days later. When his mother and her brother were sentenced to five years imprisonment for robbing a service station in 1939 (Manson was five years old) he was placed in the home of a very religious aunt and uncle. Unfortunately when his mother was paroled in 1942, Manson was returned to her. In 1947 his mother tried unsuccessfully to place him in a foster home. The court put him in a school for boys, but after 10 months he fled and returned to his mother. She rejected him. What a pretty, uplifting, and inspiring story this is.
Since the Crips gang was formed in 1969 (the Bloods were formed as an opposition to the Crips in 1971) circa 100,000 Californians have been murdered and not a small percentage of them by California gangs. There are four times as many black males in California prisons as in California colleges. Approximately one out of three young black males is in jail or prison, on probation or parole, or under pretrial release in the California criminal justice system. An African-American in California is four times as likely to be in prison as a Hispanic and seven times as likely as a white. A counter to the charge there is a racial component to the inequalities of these numbers is the fact that it is 20 times more likely for a black Californian male to be incarcerated than a Californian male of Asian descent. It is simply the case that so many African-Americans are incarcerated because they commit so much crime.
Unwittingly and with the best intentions (remember, the road to Hell is paved….) federal and California officials encouraged young men, especially minority ones, to abandon their kids. The Aid to Dependent Children program was expanded to the Aid to Families with Dependent Children in 1960. Or, in reality, Aid to Moms with Dependent Children. A working dad at home did not fit the state definition of a family. In 1964 the federal government sweetened the pot for forsaken moms with food stamps and in 1965 with Medicaid. Shortly thereafter public housing switched from fixed rent to the ability to pay. Each additional financial improvement for single moms was a discouragement for working dads to be in the home supporting their families. Talk about unintended consequences.
In 2006 the Episcopal Church’s diocese of California, headquartered in the Grace Cathedral at the top of San Francisco’s Nob Hill, was tasked with the appointment of a new bishop for the first time in 27 years. What made the selection process newsworthy was that three of the seven finalists were openly gay or lesbian. Three years earlier the appointment of Eugene Robinson as the first openly homosexual bishop in New Hampshire had almost unraveled the church worldwide. The Episcopal Church had been hemorrhaging members for 40 years prior to the elevation of Robinson. In 1960 1.9% of Americans were Episcopalians and 0.8% were Mormons. By 2002 these figures were reversed; 0.8% were Episcopalians and 1.9% were Mormons. There is nothing like defying tradition and morality to alienate people and California has a haecceity for that.
There are 250 mass graves of children in the Evergreen Cemetery in the middle of Oakland, California. Who were they? Victims of the most horrendous one day murder of children in the nation’s history. They are the remains of the tragedy of Jonestown, Guyana. Gay San Francisco Supervisor Harvey Milk said: “More people have been slaughtered in the name of religion than any other reason.” He could not have more mistaken in his assertion that religion was the cause, but he would not live to be corrected. He was shot and killed a week later by the termagant and disappointed former San Francisco Supervisor Dan White who killed the San Francisco mayor George Moscone for good measure. After a trial in which the infamous “Twinkie defense” was introduced, White was only convicted of manslaughter. A little more than a year after he was released from prison in 1985 he did the proper job himself by committing suicide. After the verdict the normally oh so liberal, against the death penalty, homosexual community was outraged and demanded that White be executed. Only in San Francisco.
The malefic Jim Jones was the architect of the Jonestown killing fields and he was no religious leader. He was a self-professed Marxist who used religion for his evil ends. Jones founded the Peoples Temple and as one of his henchmen said “We are not a church, but a social organization. We must pretend to be a church so we’re not taxed by the government.” Jones himself said “Those who remain drugged with the opiate of religion had to be brought into enlightenment – with socialism.” Jones reflected near the end that “There wasn’t a person that attended any of my meetings that did not hear me say, at one time, that I was a communist.” In all 918 people died that day at Jonestown, only some of them voluntarily; 276 children and almost as many seniors. There are jokes to this day about Kool Aid drinkers, unmindful that three year olds do not commit suicide.
So far all that I have written is rather tenebrous and caliginous (grim and gloomy), but I will conclude with a bipolar vignette which gives a ray or two of hope for California and therefore for the nation.
When Dr. Ben Chavis, a Lumbee Indian himself, although a genetic mixture of American Indian, black, and white dating back many generations, became principal of the American Indian Public Charter School in Oakland, CA the school’s Academic Performance Index (API) score (the minimum being 200 and the maximum 1000) was 436 for the academic year 2000-2001. Under his leadership steady progress was made so that by 2005-2006 the API had reached 920. What was he doing right to achieve such dramatic success? Chavis said “The students were playing Indian when I got there despite the fact that the student body was almost equally divided into African-American, Hispanic, Asian, and American Indian. The school was in total chaos.”
Chavis replaced every teacher he inherited when he came to the school. Using the personnel freedom inherent in the charter system he replaced them with smart, ambitious teachers who did not have an education degree. Given the sorry state of teacher training in California he considered this a liability. He also paid his teachers $5000 per year more than they would get in other public school in California and saved money by avoiding all of the trainers, consultants, and assistant what-nots that clutter up public school payrolls.
Every class, every day begins with 90 minutes of no-nonsense language arts. The math is just as serious and intense. Even the special-ed kids take algebra. Chavis says “I have high expectations. I don’t want excuses.” Chavis believes strongly in punctuality and attendance. A student who arrives even one minute late gets detention, but a student who completes a year without missing a single day gets a monetary reward. The classic carrot and stick approach. Many students at the school go the entire year without missing a day. The daily absentee rate is 0.33% while other intercity public schools boast of a daily 8% absentee rate. There is a sign on Chavis’ office door with 16 posted rules. One says “Squawkers, multicultural specialists, self-esteem experts, panhandlers, drug dealers, and those snapping turtles who refuse to put forth their best efforts will be booted out.” Another says “Our staff does not subscribe to the black swamp logic of minority students as victims. We will plow through such cornfield philosophy with common sense and hard work.” Chavis does not adumbrate his teaching philosophy. The school building is leased from a church next door and still has a large cross on the front. Asked how he is able to get away with that, Chavis answers “I tell the authorities that it represents the four directions of the wind and I haven’t gotten around to putting feathers on it.” Of course only an Indian could keep the PC police at bay in this topsy-turvy politically correct environment.
A second school success story is that of the Oakland Charter School. When Jorge Lopez took over the 92% Hispanic school in 2004 it was failing just as badly as the American Indian Public Charter School had been and for the same reasons. Lopez observed that the school was forcing “culture crap” on the students and mixing in enough “liberal jargon” to turn the kids against their parents. He fired the entire staff down to the janitors and started over with the Chavis model. “Culture is the job of the parents, my job is to educate the kids” said Lopez. In 2006 with 100% of the students taking the API test, Oakland Charter scored 875, second only in Oakland to Chavis’ school.
Do you know there is a parallel between the two Californians, O.J. Simpson and John Walker Lindh (the American Taliban)? One is black and the other is white, so that is not it. Both of their fathers divorced their mothers and left their families without any financial or social support. Unfortunately not too unusual, especially in California. What is a bit bizarre, even for California, is that they both left their wives and families and took up with another man. So far as I know John Walker Lindh’s father is still alive while O.J. Simpson’s father died from AIDS (Acquired Immune Deficiency Syndrome) or more correctly medically since people do not die directly from AIDS, he died because of an opportunistic disease brought on by a greatly compromised immune system. Still think California is not a bit weird? Read on.
In California, 1969 was a seminal year. It was the year the Crips gang was formed; the Tate – La Bianca murders by the Manson mob; and no fault divorce was passed. The prison population in California increased from 23,264 to 168,035 in the 25 years from 1969 to 1994. Was there a link between this much bigger incarceration increase than the population increase of the state and no fault divorce? The answer is an unqualified yes as I will justify later. For the moment consider that in 1970, the first full year of no fault divorce, the numbers of divorces was a record 112,942, a 38% increase from 1969 and was 60% higher than the nation as a whole. By 1980 California registered a new record 138,361 divorces which was more than twice as many as in 1966. What was the response of the politicians in California to the embarrassment of this accelerated divorce rate? Why, they simply stopped keeping or publishing statistics on divorce! Well, that would certainly ameliorate the problem of excessive divorces.
As related by Cashill, PBS (the Public Broadcasting System) weighed in on the issue in 1999 with their program Sesame Street. In it, Kermit the Frog, as an inquiring reporter, asks one little bird where she lives. The perky baby bird coos that she lives part of the time in a nest in a tree with her mother and the rest of the time in another nest with her father. She cheerfully explains that they both love her. What PBS doesn’t explain is that this potentially traumatic and unnatural situation might cause some of the little birds to behave badly and a few to become sociopaths the way their human counterparts do. A mere trifle in the grand scheme of things PBS might rationalize.
Californian Susan Atkins’ mother died when Susan was 10 or 11 years old. Her father was a functional alcoholic when his wife was alive and a dysfunctional alcoholic when she died. This left Susan Atkins on her own when she was 15 years old and as a result she easily became emotionally dependent upon and under the spell of the malevolent Charles Manson. The story is similar for the other three people, Linda Kasabian, Patricia Krenwinkel, and Tex Watson, who Manson dispatched to carry out the bloody business of the Tate – La Bianca murders as well as the 15 or so other young people, mostly women, who were lured into the Manson fold.
Charles “Charlie” Manson was a murderous monster – the very epitome of evil. Even far left loons might concede that he was worse than Joe McCarthy; or maybe not. Although he possibly was born a psychopath, Manson’s family background sure did not help his social development. Manson was born to an unwed mother. For a short time after his birth she was married to a laborer named William Manson. He never knew his biological father. His mother, a heavy drinker, once sold him to a childless waitress for a pitcher of beer. His uncle retrieved him a few days later. When his mother and her brother were sentenced to five years imprisonment for robbing a service station in 1939 (Manson was five years old) he was placed in the home of a very religious aunt and uncle. Unfortunately when his mother was paroled in 1942, Manson was returned to her. In 1947 his mother tried unsuccessfully to place him in a foster home. The court put him in a school for boys, but after 10 months he fled and returned to his mother. She rejected him. What a pretty, uplifting, and inspiring story this is.
Since the Crips gang was formed in 1969 (the Bloods were formed as an opposition to the Crips in 1971) circa 100,000 Californians have been murdered and not a small percentage of them by California gangs. There are four times as many black males in California prisons as in California colleges. Approximately one out of three young black males is in jail or prison, on probation or parole, or under pretrial release in the California criminal justice system. An African-American in California is four times as likely to be in prison as a Hispanic and seven times as likely as a white. A counter to the charge there is a racial component to the inequalities of these numbers is the fact that it is 20 times more likely for a black Californian male to be incarcerated than a Californian male of Asian descent. It is simply the case that so many African-Americans are incarcerated because they commit so much crime.
Unwittingly and with the best intentions (remember, the road to Hell is paved….) federal and California officials encouraged young men, especially minority ones, to abandon their kids. The Aid to Dependent Children program was expanded to the Aid to Families with Dependent Children in 1960. Or, in reality, Aid to Moms with Dependent Children. A working dad at home did not fit the state definition of a family. In 1964 the federal government sweetened the pot for forsaken moms with food stamps and in 1965 with Medicaid. Shortly thereafter public housing switched from fixed rent to the ability to pay. Each additional financial improvement for single moms was a discouragement for working dads to be in the home supporting their families. Talk about unintended consequences.
In 2006 the Episcopal Church’s diocese of California, headquartered in the Grace Cathedral at the top of San Francisco’s Nob Hill, was tasked with the appointment of a new bishop for the first time in 27 years. What made the selection process newsworthy was that three of the seven finalists were openly gay or lesbian. Three years earlier the appointment of Eugene Robinson as the first openly homosexual bishop in New Hampshire had almost unraveled the church worldwide. The Episcopal Church had been hemorrhaging members for 40 years prior to the elevation of Robinson. In 1960 1.9% of Americans were Episcopalians and 0.8% were Mormons. By 2002 these figures were reversed; 0.8% were Episcopalians and 1.9% were Mormons. There is nothing like defying tradition and morality to alienate people and California has a haecceity for that.
There are 250 mass graves of children in the Evergreen Cemetery in the middle of Oakland, California. Who were they? Victims of the most horrendous one day murder of children in the nation’s history. They are the remains of the tragedy of Jonestown, Guyana. Gay San Francisco Supervisor Harvey Milk said: “More people have been slaughtered in the name of religion than any other reason.” He could not have more mistaken in his assertion that religion was the cause, but he would not live to be corrected. He was shot and killed a week later by the termagant and disappointed former San Francisco Supervisor Dan White who killed the San Francisco mayor George Moscone for good measure. After a trial in which the infamous “Twinkie defense” was introduced, White was only convicted of manslaughter. A little more than a year after he was released from prison in 1985 he did the proper job himself by committing suicide. After the verdict the normally oh so liberal, against the death penalty, homosexual community was outraged and demanded that White be executed. Only in San Francisco.
The malefic Jim Jones was the architect of the Jonestown killing fields and he was no religious leader. He was a self-professed Marxist who used religion for his evil ends. Jones founded the Peoples Temple and as one of his henchmen said “We are not a church, but a social organization. We must pretend to be a church so we’re not taxed by the government.” Jones himself said “Those who remain drugged with the opiate of religion had to be brought into enlightenment – with socialism.” Jones reflected near the end that “There wasn’t a person that attended any of my meetings that did not hear me say, at one time, that I was a communist.” In all 918 people died that day at Jonestown, only some of them voluntarily; 276 children and almost as many seniors. There are jokes to this day about Kool Aid drinkers, unmindful that three year olds do not commit suicide.
So far all that I have written is rather tenebrous and caliginous (grim and gloomy), but I will conclude with a bipolar vignette which gives a ray or two of hope for California and therefore for the nation.
When Dr. Ben Chavis, a Lumbee Indian himself, although a genetic mixture of American Indian, black, and white dating back many generations, became principal of the American Indian Public Charter School in Oakland, CA the school’s Academic Performance Index (API) score (the minimum being 200 and the maximum 1000) was 436 for the academic year 2000-2001. Under his leadership steady progress was made so that by 2005-2006 the API had reached 920. What was he doing right to achieve such dramatic success? Chavis said “The students were playing Indian when I got there despite the fact that the student body was almost equally divided into African-American, Hispanic, Asian, and American Indian. The school was in total chaos.”
Chavis replaced every teacher he inherited when he came to the school. Using the personnel freedom inherent in the charter system he replaced them with smart, ambitious teachers who did not have an education degree. Given the sorry state of teacher training in California he considered this a liability. He also paid his teachers $5000 per year more than they would get in other public school in California and saved money by avoiding all of the trainers, consultants, and assistant what-nots that clutter up public school payrolls.
Every class, every day begins with 90 minutes of no-nonsense language arts. The math is just as serious and intense. Even the special-ed kids take algebra. Chavis says “I have high expectations. I don’t want excuses.” Chavis believes strongly in punctuality and attendance. A student who arrives even one minute late gets detention, but a student who completes a year without missing a single day gets a monetary reward. The classic carrot and stick approach. Many students at the school go the entire year without missing a day. The daily absentee rate is 0.33% while other intercity public schools boast of a daily 8% absentee rate. There is a sign on Chavis’ office door with 16 posted rules. One says “Squawkers, multicultural specialists, self-esteem experts, panhandlers, drug dealers, and those snapping turtles who refuse to put forth their best efforts will be booted out.” Another says “Our staff does not subscribe to the black swamp logic of minority students as victims. We will plow through such cornfield philosophy with common sense and hard work.” Chavis does not adumbrate his teaching philosophy. The school building is leased from a church next door and still has a large cross on the front. Asked how he is able to get away with that, Chavis answers “I tell the authorities that it represents the four directions of the wind and I haven’t gotten around to putting feathers on it.” Of course only an Indian could keep the PC police at bay in this topsy-turvy politically correct environment.
A second school success story is that of the Oakland Charter School. When Jorge Lopez took over the 92% Hispanic school in 2004 it was failing just as badly as the American Indian Public Charter School had been and for the same reasons. Lopez observed that the school was forcing “culture crap” on the students and mixing in enough “liberal jargon” to turn the kids against their parents. He fired the entire staff down to the janitors and started over with the Chavis model. “Culture is the job of the parents, my job is to educate the kids” said Lopez. In 2006 with 100% of the students taking the API test, Oakland Charter scored 875, second only in Oakland to Chavis’ school.
Saturday, January 26, 2008
FEDERAL INCOME TAXES 44
With the sempiternal Democrat/Republican debate over federal income tax increases or cuts, now or any time seems an opportune occasion to weigh in on the issue. The Democrats claim that tax cuts favor the rich and they are right. The Republicans counter that after all it is the rich who pay the overwhelming bulk of taxes and they are right. What then is ‘fair’?
Federal income tax distributions for the year 2000 show two interesting and important factors. (1) Higher income people pay a greatly disproportionate amount of federal income taxes – and naturally the higher their income the more they pay. (2) Despite the notion widely held (correctly I believe) that this is a country of middle class people, there is a mal-distribution of income. The top 1% of income, almost 1.3 million taxpayers, have an avg. Adjusted Gross Income of $1,042,725 and pay an average of $286,216 in taxes while the bottom 50% of taxpayers (more than 64 million) have an avg. AGI of $13,012 and pay an average of $598 in taxes. And the average income for lower income people as represented by the AGI figure as well as the tax paid figure may be overstated because there is a large but unreported number of people outside this IRS report who, because of their low income, do not pay taxes and are not required to file income tax statements. On the other hand there may be significant unreported cash transactions which would cause the income figure to increase.
What is the answer to the question of what is ‘fair’? My answer is to forget about what is ‘fair’. Fairness is (1) impossible to define, and (2) its perception is in the mind of the disputant. Better in my opinion to turn to an objective analysis of federal taxes as explained by the 1940’s to 1970’s economist, Abba Learner, who in 1959 - 1965 taught economics at Michigan State University. According to Prof. Learner, except for relatively minor taxes e.g., the so called ‘sin’ taxes - tax on alcohol and tobacco to discourage consumption, there are two reasons for federal taxes. (1) To redistribute income and (2) take money out of circulation to keep too many dollars from chasing too few goods and services - in other words to keep inflation under control. No, federal taxes are not levied to pay for government spending per se (see Everybody’s Business: A Re-examination of Current Assumptions in Economics and Public Policy by Abba P. Lerner). That is why the current claim, mostly by Democrats, that tax cuts should not be enacted now or at the very most should be minimal since we have an ever growing federal deficit is bogus. The economy needs the stimulus that tax cuts would provide and the bigger the better so long as this does not reignite inflation. We have been in a period of relative low inflation although currently inflation is becoming a greater risk. Forget the deficit so long as inflation is low. We are not saddling future generations with our debt. Just who are these government obligations called bills, notes and bonds owed to? Some foreigners it is true, especially the Chinese, but for the most part owed to Americans - like me for instance. In Lerner’s words: “We owe the deficit to ourselves.”
What is the best way to frame the tax cut debate? First thing is not to turn it into class warfare rhetoric the way some Democrat politicians, especially John Edwards, are doing. Across the board cuts for all taxpayers should be made and since higher income people pay the most in taxes, they should get the higher cuts – not in percentage necessarily, but in amount. To be bluntly candid about it, to varying degrees, people in descending order of tax payments are being subsidized by those who pay more tax to the point that those who pay no federal income taxes are given a free ride and those who even collect money via the so called, ‘Earned Income Credit’ are paid to ride. That is the way it is, which is not to say it is fiscally, socially, or morally wrong, but the reality of it should be recognized and admitted.
The issue of whether there should be such a big disparity in income is a different subject. Some incomes are skewed from a pure free marketplace determination by tax policies which affect enterprises such as professional sports for example. Without businesses being able to expense ticket and sponsorship fees and thereby being able to lower their own taxes, salaries for professional athletes probably would not be quite as high as they are. A major problem in this regard would to decide what are to be allowed as expense items and what are not. In fits and starts, there have been efforts made that discriminate in what is allowable and what is not. Remember the ‘three martini lunch’ brouhaha of the Carter presidential years? Then there is the issue of people who spend many years of sacrifice and depredation to eventually arrive in high income levels only to be ‘punished’ for their efforts by high taxes. Indeed making judgments on who ‘deserves’ high income and who does not is something best left to socialists and communists and other adherents of failed economic systems. To even ask the question of whether, for example, Ray Romano of the hit television show, Everybody Loves Raymond, deserved his $1.8 million fee for each ½ hour program is to exhibit a profound ignorance of free enterprise economics. He deserved it if the marketplace supported it and it seemed to.
Recently the increasingly pixilated Warren Buffett has stated that the top 10% or so of U.S.A. taxpayers should pay more and our tax structure is unfair because his secretary pays a higher tax rate than he does. Let’s analyze this latter assertion. His secretary draws a salary so, apodictically, she pays at the putative income tax rate. Buffett draws no salary so let us say he derives all of his income from long term capital gains. The capital gains rate in the U.S.A. is currently 15% (5% for people in the lowest two income tax brackets). Buffett’s net wealth is estimated at $55 billion or so. With the financial market downturn so far this year (2008) let us round that down to $50 billion and supposing a realized capital gains withdrawal of .1% from all of his assets he would have a pre-tax income of $50 million and a post- tax income of $50 x .85 = $42 ½ million. I could live on that. Incidentally the long term capital gains rate in Belgium, Germany, and Hong Kong, exempli grātiā is zero and in the idyllic country of Iceland (it was rated the best country in which to live in 2007) the C.G. rate is 10%. Wouldn’t you know that the C.G. rate in socialistic Sweden is 30% so perhaps Buffett should move to Stockholm.
If Buffett feels guilty for not paying more federal tax I would like to assure him that he may give the IRS as much money as he desires and they will accept it so long as he makes clear he is voluntarily over paying his taxes.
Buffett is a bit eldritch in other aspects as well. He married his wife Susan in 1952 when he was 22 years old. She died of a stroke (she also had cancer) in 2004. In 2006 when he was 76 he married 60 year old Astrid Menks, from Latvia who had been his assistant and companion for 20 years. What about his wife? They had lived apart since 1977 and allegedly did not disapprove of her husband’s liaison with his paramour.
As an addendum consider the following facts: In 2006 the bottom 50% of federal income tax payers (65 million) paid $27 billion in taxes - 3.5% of all income taxes paid. The ExxonMobil corporation paid $41 billion worldwide in taxes that year. In other words, ExxonMobil paid $14 billion more in taxes than 65 million U.S. tax payers.
Federal income tax distributions for the year 2000 show two interesting and important factors. (1) Higher income people pay a greatly disproportionate amount of federal income taxes – and naturally the higher their income the more they pay. (2) Despite the notion widely held (correctly I believe) that this is a country of middle class people, there is a mal-distribution of income. The top 1% of income, almost 1.3 million taxpayers, have an avg. Adjusted Gross Income of $1,042,725 and pay an average of $286,216 in taxes while the bottom 50% of taxpayers (more than 64 million) have an avg. AGI of $13,012 and pay an average of $598 in taxes. And the average income for lower income people as represented by the AGI figure as well as the tax paid figure may be overstated because there is a large but unreported number of people outside this IRS report who, because of their low income, do not pay taxes and are not required to file income tax statements. On the other hand there may be significant unreported cash transactions which would cause the income figure to increase.
What is the answer to the question of what is ‘fair’? My answer is to forget about what is ‘fair’. Fairness is (1) impossible to define, and (2) its perception is in the mind of the disputant. Better in my opinion to turn to an objective analysis of federal taxes as explained by the 1940’s to 1970’s economist, Abba Learner, who in 1959 - 1965 taught economics at Michigan State University. According to Prof. Learner, except for relatively minor taxes e.g., the so called ‘sin’ taxes - tax on alcohol and tobacco to discourage consumption, there are two reasons for federal taxes. (1) To redistribute income and (2) take money out of circulation to keep too many dollars from chasing too few goods and services - in other words to keep inflation under control. No, federal taxes are not levied to pay for government spending per se (see Everybody’s Business: A Re-examination of Current Assumptions in Economics and Public Policy by Abba P. Lerner). That is why the current claim, mostly by Democrats, that tax cuts should not be enacted now or at the very most should be minimal since we have an ever growing federal deficit is bogus. The economy needs the stimulus that tax cuts would provide and the bigger the better so long as this does not reignite inflation. We have been in a period of relative low inflation although currently inflation is becoming a greater risk. Forget the deficit so long as inflation is low. We are not saddling future generations with our debt. Just who are these government obligations called bills, notes and bonds owed to? Some foreigners it is true, especially the Chinese, but for the most part owed to Americans - like me for instance. In Lerner’s words: “We owe the deficit to ourselves.”
What is the best way to frame the tax cut debate? First thing is not to turn it into class warfare rhetoric the way some Democrat politicians, especially John Edwards, are doing. Across the board cuts for all taxpayers should be made and since higher income people pay the most in taxes, they should get the higher cuts – not in percentage necessarily, but in amount. To be bluntly candid about it, to varying degrees, people in descending order of tax payments are being subsidized by those who pay more tax to the point that those who pay no federal income taxes are given a free ride and those who even collect money via the so called, ‘Earned Income Credit’ are paid to ride. That is the way it is, which is not to say it is fiscally, socially, or morally wrong, but the reality of it should be recognized and admitted.
The issue of whether there should be such a big disparity in income is a different subject. Some incomes are skewed from a pure free marketplace determination by tax policies which affect enterprises such as professional sports for example. Without businesses being able to expense ticket and sponsorship fees and thereby being able to lower their own taxes, salaries for professional athletes probably would not be quite as high as they are. A major problem in this regard would to decide what are to be allowed as expense items and what are not. In fits and starts, there have been efforts made that discriminate in what is allowable and what is not. Remember the ‘three martini lunch’ brouhaha of the Carter presidential years? Then there is the issue of people who spend many years of sacrifice and depredation to eventually arrive in high income levels only to be ‘punished’ for their efforts by high taxes. Indeed making judgments on who ‘deserves’ high income and who does not is something best left to socialists and communists and other adherents of failed economic systems. To even ask the question of whether, for example, Ray Romano of the hit television show, Everybody Loves Raymond, deserved his $1.8 million fee for each ½ hour program is to exhibit a profound ignorance of free enterprise economics. He deserved it if the marketplace supported it and it seemed to.
Recently the increasingly pixilated Warren Buffett has stated that the top 10% or so of U.S.A. taxpayers should pay more and our tax structure is unfair because his secretary pays a higher tax rate than he does. Let’s analyze this latter assertion. His secretary draws a salary so, apodictically, she pays at the putative income tax rate. Buffett draws no salary so let us say he derives all of his income from long term capital gains. The capital gains rate in the U.S.A. is currently 15% (5% for people in the lowest two income tax brackets). Buffett’s net wealth is estimated at $55 billion or so. With the financial market downturn so far this year (2008) let us round that down to $50 billion and supposing a realized capital gains withdrawal of .1% from all of his assets he would have a pre-tax income of $50 million and a post- tax income of $50 x .85 = $42 ½ million. I could live on that. Incidentally the long term capital gains rate in Belgium, Germany, and Hong Kong, exempli grātiā is zero and in the idyllic country of Iceland (it was rated the best country in which to live in 2007) the C.G. rate is 10%. Wouldn’t you know that the C.G. rate in socialistic Sweden is 30% so perhaps Buffett should move to Stockholm.
If Buffett feels guilty for not paying more federal tax I would like to assure him that he may give the IRS as much money as he desires and they will accept it so long as he makes clear he is voluntarily over paying his taxes.
Buffett is a bit eldritch in other aspects as well. He married his wife Susan in 1952 when he was 22 years old. She died of a stroke (she also had cancer) in 2004. In 2006 when he was 76 he married 60 year old Astrid Menks, from Latvia who had been his assistant and companion for 20 years. What about his wife? They had lived apart since 1977 and allegedly did not disapprove of her husband’s liaison with his paramour.
As an addendum consider the following facts: In 2006 the bottom 50% of federal income tax payers (65 million) paid $27 billion in taxes - 3.5% of all income taxes paid. The ExxonMobil corporation paid $41 billion worldwide in taxes that year. In other words, ExxonMobil paid $14 billion more in taxes than 65 million U.S. tax payers.
Wednesday, January 9, 2008
MARBURY V. MADISON 43
One of the most important Supreme Court decisions was Marbury v. Madison in 1803. I knew what it was, but did not know the story behind it. Perhaps you did, if not however, you may be interested to read about it now.
John Adams, a New Englander from Massachusetts and Thomas Jefferson, a Southerner from Virginia were revolutionary period colleagues and friends during the founding of the Republic even though they could not have been more different in personalities, temperament, and politics. It was perhaps inevitable they would have a falling out. Jefferson was the Vice-President of the United States when Adams was President from 1797-1801 on the basis of Jefferson receiving the second most electoral votes even though they belong to different political parties. When Jefferson challenged Adams for the presidency and won in 1801 not only was the rupture in their friendship complete, they became bitter enemies.
During the last days of Adams’s one presidential term the majority Federalist Party in congress passed legislation greatly expanding the number of federal judges including justices-of-the-peace. Adams proceeded to name people of his political persuasion to these positions. A few weeks before Adams had named his Secretary of State and 2nd cousin of Thomas Jefferson, Virginian John Marshall as Chief Justice of the then six-man US Supreme Court (the court was increased to the present number of nine in 1869). Marshall thus became the 4th Chief Justice of the Supreme Court, replacing President Washington appointed Oliver Ellsworth (John Jay of course was the 1st).
Adams was literally still writing out the names of the people he appointed as judges on his last day in office. As Secretary of State, John Marshall had the task to deliver these written commissions to each individual. Because he simply did not have time to deliver all of them he gave half to his brother James to deliver. His brother, apparently being less conscientious or less industrious, did not deliver all of them. When the new administration came in President Jefferson told his Secretary of State, James Madison, not to deliver the remaining 17 commissions.
Ten months later William Marbury who had been appointed Justice of the Peace in the District of Columbia took his case to the Supreme Court. The Jefferson dominated congress passed a law canceling the next session of the Supreme Court. When the court finally convened 14 months later the first case it took up was Marbury v. Madison. Marshall, being an astute lawyer, realized this was an important case for the nascent court to consider. He knew if he refused to take the case the court would look weak, but if he took it and ruled in favor of Marbury he also knew that the Jefferson administration would simply ignore the court’s order in which case the court would likewise appear weak and ineffectual. So what to do. Marshall formulated a strategy to strengthen the court at a time when it was very much the weakest and least respected part of government relative to the legislative and executive branches. His solution defined the genius of John Marshall and set the Supreme Court on the path to becoming an equal to the legislative and executive branches.
In the court’s long and detailed decision Marshall scolded the Jefferson administration by writing that Marbury had been treated very badly by having his commission illegally withheld and he should be given it now. It looked like Marbury had won and the Jefferson administration had lost. But wait; there was more to the decision. Marshall also ruled that the court did not have jurisdiction in this case - then came the key to the ingenuity of the decision. Marshall wrote that the law expanding the judiciary was unconstitutional thus establishing the precedent of judicial review by the Supreme Court. Article I section 7 of the constitution clearly gave the president power to veto legislation and the congress power to override a presidential veto. It was John Marshall who gave the Supreme Court power to invalidate laws passed by congress and the president by implicit, not explicit, language in the constitution. Not article III which authorized the Supreme Court nor in any other place in the constitution is the power of judicial review mentioned.
When the decision came down, some of the Jeffersonians thought they had won. Thomas Jefferson however quickly realized that in fact he had not won, but was caught on the horns of a dilemma. He did not want it to appear he had been dragooned by the court into giving Marbury his commission and besides he did not want more Federalists on the bench with lifetime appointments, but by not granting the commission he was implicitly conceding the court the power of judicial review. He did his best by seemingly ignoring the ruling; however a precedent had been set which would be built upon in future court decisions. It is instructive though that John Marshall, who the longest serving (34 years) Chief Justice of the US Supreme Court, never again declared a law passed by congress and the president unconstitutional. He had extricated the court from a difficult position in Marbury v. Madison and he did not want to press his luck.
John Adams, a New Englander from Massachusetts and Thomas Jefferson, a Southerner from Virginia were revolutionary period colleagues and friends during the founding of the Republic even though they could not have been more different in personalities, temperament, and politics. It was perhaps inevitable they would have a falling out. Jefferson was the Vice-President of the United States when Adams was President from 1797-1801 on the basis of Jefferson receiving the second most electoral votes even though they belong to different political parties. When Jefferson challenged Adams for the presidency and won in 1801 not only was the rupture in their friendship complete, they became bitter enemies.
During the last days of Adams’s one presidential term the majority Federalist Party in congress passed legislation greatly expanding the number of federal judges including justices-of-the-peace. Adams proceeded to name people of his political persuasion to these positions. A few weeks before Adams had named his Secretary of State and 2nd cousin of Thomas Jefferson, Virginian John Marshall as Chief Justice of the then six-man US Supreme Court (the court was increased to the present number of nine in 1869). Marshall thus became the 4th Chief Justice of the Supreme Court, replacing President Washington appointed Oliver Ellsworth (John Jay of course was the 1st).
Adams was literally still writing out the names of the people he appointed as judges on his last day in office. As Secretary of State, John Marshall had the task to deliver these written commissions to each individual. Because he simply did not have time to deliver all of them he gave half to his brother James to deliver. His brother, apparently being less conscientious or less industrious, did not deliver all of them. When the new administration came in President Jefferson told his Secretary of State, James Madison, not to deliver the remaining 17 commissions.
Ten months later William Marbury who had been appointed Justice of the Peace in the District of Columbia took his case to the Supreme Court. The Jefferson dominated congress passed a law canceling the next session of the Supreme Court. When the court finally convened 14 months later the first case it took up was Marbury v. Madison. Marshall, being an astute lawyer, realized this was an important case for the nascent court to consider. He knew if he refused to take the case the court would look weak, but if he took it and ruled in favor of Marbury he also knew that the Jefferson administration would simply ignore the court’s order in which case the court would likewise appear weak and ineffectual. So what to do. Marshall formulated a strategy to strengthen the court at a time when it was very much the weakest and least respected part of government relative to the legislative and executive branches. His solution defined the genius of John Marshall and set the Supreme Court on the path to becoming an equal to the legislative and executive branches.
In the court’s long and detailed decision Marshall scolded the Jefferson administration by writing that Marbury had been treated very badly by having his commission illegally withheld and he should be given it now. It looked like Marbury had won and the Jefferson administration had lost. But wait; there was more to the decision. Marshall also ruled that the court did not have jurisdiction in this case - then came the key to the ingenuity of the decision. Marshall wrote that the law expanding the judiciary was unconstitutional thus establishing the precedent of judicial review by the Supreme Court. Article I section 7 of the constitution clearly gave the president power to veto legislation and the congress power to override a presidential veto. It was John Marshall who gave the Supreme Court power to invalidate laws passed by congress and the president by implicit, not explicit, language in the constitution. Not article III which authorized the Supreme Court nor in any other place in the constitution is the power of judicial review mentioned.
When the decision came down, some of the Jeffersonians thought they had won. Thomas Jefferson however quickly realized that in fact he had not won, but was caught on the horns of a dilemma. He did not want it to appear he had been dragooned by the court into giving Marbury his commission and besides he did not want more Federalists on the bench with lifetime appointments, but by not granting the commission he was implicitly conceding the court the power of judicial review. He did his best by seemingly ignoring the ruling; however a precedent had been set which would be built upon in future court decisions. It is instructive though that John Marshall, who the longest serving (34 years) Chief Justice of the US Supreme Court, never again declared a law passed by congress and the president unconstitutional. He had extricated the court from a difficult position in Marbury v. Madison and he did not want to press his luck.
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