8/30, PM UPDATES: Airlifts to Vermont; Irene Deaths: 41; 2.85 Million People w/o Power; In NJ: Flooding Remains

TUESDAY, 8/30/11 UPDATES:
Isolated flood-besieged Vermont towns are receiving supplies by way of National Guard airlifts: Newport News Daily Press: "National Guard airlifts take food, water to Vt. towns cut off by Irene's flooding."

(There's the helpful hand of the national government. Think about that one, Tea-Partiers. Army Corp of Engineers, FEMA, those are federal agency helping the public, tax dollars at work.)

CNN reports that the death toll from Hurricane Irene now stands at 41: "Irene update: Death toll at 41; 2.85 million still without power."

Flooding of rivers in the Passaic River Basin is affecting towns throughout northern New Jersey, covering streets, flooding homes. (Reuters)

Most of eastern Connecticut remains without power. (Wall Street Journal)

FDR Didn't Govern from 'the Center' -- Neither Should Obama

From alternet.org, another articulate voice calling on President-elect Barack Obama to govern in a progressive direction, not from the cautious, timid center:

Gray Brechin, "FDR Didn't Govern from 'the Center' -- Neither Should Obama":
We can't forget what bold and ingenious leadership can accomplish against the caution of low expectations in harsh economic times.
House Speaker Nancy Pelosi wasted no time cautioning Americans that they should not let their hopes run away with them just because the Democrats scored an electoral landslide. Calling herself a "proud progressive," Pelosi advised president-elect Obama's supporters to exercise the diminished expectations of political prudence: "The country must be governed from the middle," she said a day after his victory.

November marked the 75th anniversary of one of the least known relief agencies to come out of the New Deal -- the Civil Works Administration. At a time when the press regularly fuses FDR's jaunty image with that of Barack Obama's -- and when the president-elect himself vows to create 2.5 million new jobs within two years as "a plan big enough to meet the challenges we face" -- we should remember how much more one short-lived agency accomplished through the winter of another economic crisis.

The Speaker, whose father represented Baltimore as a New Deal Democrat, must know that Franklin Roosevelt did not govern from the middle. He chose a Midwestern social worker steeped in the Social Gospel movement at Iowa's Grinnell College to run his relief programs, Harry Hopkins knew that legions of impoverished Americans could not wait for the cautious policies of Harold Ickes' Public Works Administration to provide them with jobs. Neither could his boss.

On November 9, 1933 President Roosevelt issued an executive order creating the Civil Works Administration. He did so by moving $400 million ($6.4 billion in today's dollars) previously allocated to the PWA into the CWA account. A meeting of governors, mayors and other public officials six days later at Washington's Mayflower Hotel effectively launched the agency.

Five days later, Eleanor Roosevelt hosted a White House gathering to organize women's participation in the program. Three days after that -- with the Government Printing Office working round the clock to cut checks -- CWA workers shared wages of almost $8 million. On November 28, Hopkins created a Civil Works Service to employ white collar workers as teachers, surveyors, artists, nurses, librarians, musicians, and other public servants.

By December 7 -- less than a month after Roosevelt's executive order -- the CWA had two million Americans working on a vast array of socially beneficial projects. By January 18, employment had doubled to more than four million. U.S. population was then less than half of today's.

Hopkins likened the CWA workers to foot soldiers with the difference that, "The results achieved have been the reverse of those usually brought about by old-style wars." The CWA's work was, like the title of a famous William James essay, "the moral equivalent of war." As such Hopkins noted that "Hardly a community but can show some lasting benefit derived from Civil Works activities: a street paved, a school-house reconditioned, a nursery school installed, a new playground."

CWA workers toiled through a hard winter building and repairing 244,000 miles or roads, laying water and sewage mains, constructing 350 swimming pools and 4000 athletic fields. Their jackhammers broke frozen ground to make Newark's airport, one of a thousand built around the country. New York Park Commissioner Robert Moses set three shifts of CWA crews working around the clock to renovate Central and Prospect Parks. A team of artists painted frescos in San Francisco's Coit Tower while CWA orchestras and bands performed concerts free to the public. The agency employed as many as 50,000 teachers and built or refurbished 4000 schools to revive the nation's dying public education system. CWA workers restored historic buildings and launched the Historic American Building Survey which continues to meticulously record historic structures for the Library of Congress 75 years later.

Hopkins and Roosevelt intended the CWA only to bridge an emergency. It was terminated on March 31, but the Depression, unfortunately, was not. A year later, the more famous Works Progress Administration picked up where the CWA had left off, employing 8.5 million people in its seven productive years. Harry Hopkins ran that as well.

Hopkins hoped that "Long after the workers of the CWA are dead and gone and these hard times are forgotten, their effort will be remembered by permanent useful works in every county of every state." Alas, he was wrong, though as he predicted we "ride over bridges they made, travel on their highways, attend schools they built, navigate waterways they improved, do [our] public business in courthouses and state capitols which workers from CWA rescued from disrepair."

Unlike the WPA, the CWA left almost no markers to commemorate the achievements of four and a half months of heroic activity. We unwittingly take the achievements of the CWA -- like so much else of the New Deal -- for granted while the New Deal's eternal enemies echo the fable that federal workers did little but lean on their shovels. But as winter approaches, the CWA's record reminds us of what bold and ingenious leadership can accomplish against the caution of low expectations in harsh economic times. Indeed, it must.

Howard Zinn on bailout: Take a tip from the New Deal

Howard Zinn in "The Nation": Take a tip from the New Deal: invest that $700 billion in jobs and mortgage aid for those who need it most.

How refreshing it would be if a presidential candidate reminded us of the experience of the New Deal.

Lead points in historian and activist Howard Zinn's article on stimulating the economy, via the people:

It is sad to see both major parties agree to spend $700 billion of taxpayer money to bail out huge financial institutions that are notable for two characteristics: incompetence and greed. There is a much better solution to the financial crisis. But it would require discarding what has been conventional wisdom for too long: that government intervention in the economy ("big government") must be avoided like the plague, because the "free market" can be depended on to guide the economy toward growth and justice. Surely the sight of Wall Street begging for government aid is almost comic in light of its long devotion to a "free market" unregulated by government.

Let's face a historical truth: we have never had a free market. We have always had government intervention in the economy, and indeed that intervention has been welcomed by the captains of finance and industry. These titans of wealth hypocritically warned against "big government" but only when government threatened to regulate their activities or when it contemplated passing some of the nation's wealth on to the neediest people. They had no quarrel with big government when it served their needs.

. . .

In framing the Constitution, the founders created "big government" powerful enough to put down the rebellions of farmers, to return escaped slaves to their masters and to put down Indian resistance when settlers moved westward. The first big bailout was the decision of the new government to redeem for full value the almost worthless bonds held by speculators.

From the start, in the first sessions of the first Congress, the government interfered with the free market by establishing tariffs to subsidize manufacturers and by becoming a partner with private banks in establishing a national bank. This role of big government supporting the interests of the business classes has continued all through the nation's history. Thus, in the nineteenth century the government subsidized canals and the merchant marine. In the decades before and during the Civil War, the government gave away some 100 million acres of land to the railroads, along with considerable loans to keep the railroad interests in business. The 10,000 Chinese and 3,000 Irish who worked on the transcontinental railroad got no free land and no loans, only long hours, little pay, accidents and sickness.

The principle of government helping big business and refusing government largesse to the poor was bipartisan, upheld by Republicans and Democrats. President Grover Cleveland, a Democrat, vetoed a bill to give $10,000 to Texas farmers to help them buy seed grain during a drought, saying, "Federal aid in such cases encourages the expectation of paternal care on the part of the government and weakens the sturdiness of our national character." But that same year, he used the gold surplus to pay wealthy bondholders $28 above the value of each bond--a gift of $5 million.

. . .
[Now, to the present}
We have a historic and successful precedent. The government in the early days of the New Deal put millions of people to work rebuilding the nation's infrastructure. Hundreds of thousands of young people, instead of joining the army to escape poverty, joined the Civil Conservation Corps, which built bridges and highways, cleaned up harbors and rivers. Thousands of artists, musicians and writers were employed by the WPA's arts programs to paint murals, produce plays, write symphonies. The New Deal (defying the cries of "socialism") established Social Security, which, along with the GI Bill, became a model for what government could do to help its people.

That can be carried further, with "health security"--free healthcare for all, administered by the government, paid for from our Treasury, bypassing the insurance companies and the other privateers of the health industry. All that will take more than $700 billion. But the money is there: in the $600 billion for the military budget, once we decide we will not be a warmaking nation anymore, and in the bloated bank accounts of the superrich, once we bring them down to ordinary-rich size by taxing vigorously their income and their wealth.

When the cry goes up, whether from Republicans or Democrats, that this must not be done because it is "big government," the citizens should just laugh. And then agitate and organize on behalf of what the Declaration of Independence promised: that it is the responsibility of government to ensure the equal right of all to "Life, Liberty, and the pursuit of Happiness."

This is a golden opportunity for Obama to distance himself cleanly from McCain as well as the fossilized Democratic Party leaders, giving life to his slogan of change and thereby sweeping into office. And if he doesn't act, it will be up to the people, as it always has been, to raise a shout that will be heard around the world--and compel the politicians to listen.

Knowing the players in the G7 meeting

The G7 meeting could not come at a more momentous moment than the present. Yes, this is obvious and it is a grand understatement. (The G7 finance ministers are meeting at the White House, hosted by United States President George Bush, today.)

(Let me give you the spoiler of this article: the G7 is Conservative leaning.)
That said, let's get to business. In the current situation of the stock markets and finance sector, we would hope that governments would act toward lessening the deleterious impact upon their populaces, and that they would act to draw the benefits of state intervention in the direction of the state. In plain English, let's hope that finance reforms include government interventions in the banking system that channel profits toward the government, and thence to the taxpayers/populace, either in the form of rebates or in social spending.
This latter direction is one that the Democratic leadership in the United States Congress has undertaken. Among G7 members, this direction would be more likely pursued by Social Democratic Parties. As we see below, the tilt of the G7, in political party, is toward the Conservative direction. So, the implementation of a Social-Democratic direction, of a populist minded finance policy, is not likely to happen.

I have just taken an inventory of the finance ministers of the G7 member states and their partisan orientations. And the tally is as follows:
Canada: Conservative
France: Conservative
Germany: Social Democratic
Great Britain: [de facto Social Democratic]
Italy: Conservative
Japan: Conservative
Russia: ?
The United States: Conservative

(I have taken the liberty of changing formal party names to the kind of ideological and policy-oriented direction that they lean- Conservative or Social Democratic. In European (+ Israeli + Japanese) understanding of political lexicon, Social Democratic would apply to Great Britain's governing Labour Party, even though it is distinct from the "Social-Democratic Party" of Great Britain/United Kingdom.
As to Russia, it is difficult to place the finance minister. Their government is a de facto presidential government --regardless of his title of prime minister, and as such we would extrapolate the philosophies of the finance minister as following the prerogatives of Vladmir Putin. Despite Putin's CCCP roots, his government has not acted to stanch trends of increasing cost of living or an unstable financial sector, as this reading --by Edward Hugh, October 3-- of the financial scene indicates. I put very little stock in his moving to steer financial policy in an economic populist direction.)
Germany provides the sole left of center minister of finance (Peer Steinbrück-SPD), aside from Great Britain (Alistair Darling-Labour).

Translation: I am anticipating "changes" or "reforms" that serve banks interests, without a mind toward socially-minded channeling of profits or government-directed oversight. Thus, in the long term, I am pessimistic that G7 reforms will improve the current crisis.

On the other hand, this is a fluid time. It appears that free-market oriented political party-led governments are now contemplating or enacting state takeover of banks. Let's hope that the G7 ministers act toward charting financial markets in a stable direction. But let's also hope that they consider the ordinary depositors and taxpayers, not simply the major banks. I'm holding my breath on the latter point.