Public Works

PUBLIC WORKS....California is on the verge of cancelling hundreds of public works projects because it can't sell the revenue anticipation bonds needed to continue financing them:

Road, levee, school and housing construction projects throughout California are on the verge of being halted or delayed, as state officials prepare to shut off their financing in the most drastic fallout yet from California's cash crisis.

Officials plan to meet today to freeze financing on these projects and about 2,000 others, including park improvements, environmental restoration and repairs to state prisons.

....Lockyer told legislators last week that halting public-works projects would have a ripple effect through California's economy, costing private companies $12.5 billion and eliminating 200,000 jobs.

Let me just say up front that California's problems are largely of our own making. If the rest of the country has zero sympathy for us, I don't really blame them.

Still, this is a national problem, not just a local one. And if infrastructure spending is good stimulus, but the problem is that it takes a long time to get it up and running, then surely, at a minimum, you wouldn't want to lose a single dollar of infrastructure spending that's already in progress. Especially when the immediate problem has been caused by the freezing of the credit markets more than by California's fiscal recklessness. TARP to the rescue?

tom-vilsack.jpg It is easy to groan at the selection of former Iowa Governor Tom Vilsack as Barack Obama's Secretary of Agriculture. Ezra Klein over at the Prospect notes that the pick signals two important things that are sure to disappoint food policy reformers. (1) Politicians from agricultural states are enmeshed in the politics of farm subsidies, and Iowa, as the number one corn-producing state in the country, can likely count on a continued flow of poisonous corn subsidies under Vilsack. (2) USDA will continue to be a department for food producers instead of one for food consumers, meaning that food policy decisions will be made with the needs of agribusiness first and the needs of low-income kids with little access to healthy food options second. (If you don't know why those two things are at odds, you haven't been listening to Michael Pollan.) It is because a conventional pick like Vilsack likely means the continuation of policies that harm both eaters and small farmers that food activists were passing around a petition to get a reformer the job. Alas, it didn't happen.

But before we throw our foodie/organic-only/locavore selves into complete despair, let's take a closer look at Vilsack. For a former governor of a corn behemoth, he's actually has the right instincts.

Person of the Year

PERSON OF THE YEAR....In a shocking surprise, Time has named Barack Obama their person of the year. Yawn. I would have voted for one of those cheesy group picks, in this case "America's mortgage bankers and Wall Street rocket scientists." I mean, if touching off the 21st century version of the Great Depression doesn't make you person of the year, what the hell does it take?

Runners up were Henry Paulson, Nicolas Sarkozy, Zhang Yimou, and, in a tremendous diss to poor old John McCain, Sarah Palin. Feh. Tina Fey would have been a more deserving choice.

Arne Duncan on the Court

ARNE DUNCAN ON THE COURT....I don't know anything about Arne Duncan's actual views on education, but what you're really thirsting for is some insight into his hoops skills, right? So here you go, courtesty of reader JT, who was friendly with the basketball coach at University High three decades ago and ended up played pickup games with the 16-year-old Duncan in the University High gym:

On Sunday afternoons, John would open the UHigh gym to his friends and his team....It was there that I ended up playing against and with Arne Duncan and then watching him play in UHigh games.

Arne was a very intelligent (Doh!) and very unselfish basketball player. If I recall rightly, he was the tallest player on the team, but he was also the best ball-handler. He had a good jump shot, but he was slow and not extremely quick. What he did have, however, was outstanding court vision. If you were going to be open off a cut, or a break out, he would see it before it occurred and get you the ball in position to do something with it.

Indeed, I recall John complaining that Arne was TOO unselfish. He was by far the best shooter on the team, and most of his teammates could not do enough with the ball when they got it.

I have no idea what, if anything, this means. Does outstanding court vision translate into awesome bureaucratic infighting skills? Does great ball handling mean he knows how to handle the teachers unions? Speculate away!

Which State Is the Most Corrupt?

In the wake of the Blagojevich scandal, we've heard a lot about how corrupt "Chicago politics" are. But what's the real story? A pretty graph tells the tale:

corruption.png

Turns out that while Illinois is more corrupt than most states, it's not Blagojevich but another allegedly-criminal Democrat, now-former Rep. William Jefferson, who comes from the most corrupt state in the union. That's Louisiana, home to sometime GOP presidential aspirant Bobby Jindal. All four of the most corrupt states in the union are red states, and three are in the deep south. And the third-most corrupt state just reelected the Republicans' leader in the senate, Mitch McConnell. Can we stop the ridiculous guilt-by-association game now? Just because a politician's home state has a reputation (deserved or undeserved) for corruption doesn't mean he or she is therefore also corrupt. Even if a sitting governor from the politician's own party has just been arrested.

(Via Matt Yglesias)

I don't know if Hardball host Chris Matthews will run for the U.S. Senate in Pennsylvania and challenge incumbent Republican Arlen Specter. I do know that it would be refreshing to have a fellow in the Senate with as much passion as Matthews. Sure, he peeved a number of people with his comments on Hillary Clinton during the recent presidential campaign. But last night, I was a guest on his show and watched Matthews eviscerate former Reagan administration aide Frank Gaffney on the question of whether the Iraq war had been justified. I had been booked to debate Gaffney on the subject. But Matthews tore into him more than I could.

I give Matthews plenty of credit--not just for being right on this issue but for devoting the first quarter of his show to the matter. He shoved aside Blago and Caroline Kennedy to discuss a war that the mainstream media does not sufficiently cover. There aren't many television talk show hosts who still greatly care about whether George W. Bush, Dick Cheney and the rest of that crew hoodwinked the country into war. But Matthews does. He wants to win the fight over the history and make sure that the public does not forget how the soon-to-be-gone Bush administration misled the nation. I'm not urging Matthews to run--I enjoy appearing on his show and would be sad to see it disappear--but it would be heartening to see in the Senate a man who displays so much zeal on this front.

I have a feeling that in the coming years the Bush-backers and neocons will not give up the fight; they will relentlessly argue that the war was right and just. Even though the majority of the American public doesn't buy that, the foes of the war will have to push back and do combat over and over on this point. Whether Matthews is on TV or in the Senate, he could be a valuable participant in that (alas) never-ending debate.

Kevin helped drive a stake through the heart of a favorite conservative trope yesterday when he put up a chart illustrating the effective tax rate on the rich and superrich. (Hint: It's only slightly higher than the middle and upper middle classes.) This article should finish it off. Guess what the effective tax rate on Goldman Sachs, which made $2.8 billion in 2008, will be this year? One percent.

Out of Iraq

OUT OF IRAQ....Barack Obama visited an elementary school today and chatted with the children. From the pool report:

Then he told the kids he was opening the floor to questions, and proceeded to take more than double the number of questions than he took at his press conference....One child ask him about iraq and he said he plans to have troops home in.a year and a half.

This is good to hear. Obama wouldn't lie to a bunch of fourth graders, would he?

The Gift of Nature

399px-Eaglecreek-28July2006.jpg Walking in a park in any season or even viewing pictures of nature helps improve memory and attention by 20 percent. All it takes is 30 minutes. Even when it's cold. Even when we don't enjoy it. The study by U of Michigan researchers found that effects of interacting with nature are similar to meditating.

Participants were sent on walking routes through urban streets as well as through a botanical garden and arboretum. The city strolls provided no memory boost but the parks improved short-term memory. Interestingly, the test subjects didn't need to enjoy the walks. They received the same cognitive benefits when it was 80 degrees and sunny as when it was 25 degrees in winter.

Participants were also tested sitting inside and looking at pictures of either downtown scenes or nature scenes. The results were the same: about 20 percent improvement in memory and attention scores from looking at photos of nature.

The study appears in Psychological Science and dovetails with some of the researchers' earlier work suggesting that people will be most satisfied with their lives when their environment supports three basic needs: the ability to understand and explore; the ability to make a difference; and ability to feel competent and effective.

Best holiday present? Take someone out into nature. Truly the gift that gives forever. Or at least for 20 percent longer.

Julia Whitty is Mother Jones' environmental correspondent, lecturer, and 2008 winner of the PEN USA Literary Award, the Kiriyama Prize and the John Burroughs Medal.

Median Wages

MEDIAN WAGES....So let's assume that we manage to stabilize the economy sometime soon via whatever combination of stimulus spending, tax cuts, and bailouts you think is best. What's next? Where will demand come from to get the economy moving normally again? Paul Krugman comments:

I find it useful to compare U.S. spending in recent years with spending in the mid-90s, when things seemed much more sustainable. What changed? Well, we had bloated housing investment and bloated consumer spending. Meanwhile, nonresidental investment as a percentage of GDP was about the same in 2007 as it was in 1996.

So what offset the consumer/housing boom? A vastly increased trade deficit. And that suggests that a return to normalcy would involve getting savings up, housing spending down, and a combination of more exports and less imports.

I think the big thing I'd add to that is growth in median incomes. One way or another, there's really no way for the economy to grow strongly and consistently unless middle-class consumers spend more, and they can't spend more unless they make more. This was masked for a few years by the dotcom bubble, followed by the housing bubble, all propped on top of a continuing increase in consumer debt. None of those things are sustainable, though. The only sustainable source of consistent growth is rising median wages. The rich just don't spend enough all by themselves.

The flip side of this, of course, is that rich people are going to have to accept the fact that they don't get all the money anymore. Their incomes will still grow, but no faster than anyone else's.

How do we make this happen, though? I'm not sure. Stronger unions are a part of it. Maybe a higher minimum wage. Stronger immigration controls. More progressive taxation. National healthcare. Education reforms. Maybe it's just a gigantic cultural adjustment. Add your own favorite policy prescription here.

This isn't just a matter of social justice. It's a matter of facing reality. If we want a strong economy, we can only get it over the long term if we figure out a way for the benefits of economic growth to flow to everyone, not just the rich. This is, by far, Barack Obama's biggest economic challenge. Until median wages start rising steadily and consistently, we haven't gotten ourselves back on track.