Romney lacks a sense of community

My column in the Sky Hi News today

The Bain Capital vs. job creation debate has indeed gone off the rails. Two are at fault: the Democrats and the Republicans. Each side is attempting to twist and spin the accusations of the other. Their responses only make it worse.

Mitt Romney began his campaign with one premise: His expertise in venture capitalism uniquely qualifies him to fix the economy and create jobs, and the Democrats made a big deal of examples of his failure to create jobs. The conflict then devolved to whether Romney was qualified to be president and the Republicans claimed Obama was not qualified either because mostly — gasp!— he was just a community organizer and therefore anti-business and anti-capitalism.

Vice President Joe Biden once in a while gets it right and sometimes gets it wrong. Equating the governing skills of an investment banker with a plumber was silly but his assertions that “he (Romney) does not get us” (an audience of blue collar workers) was closer to the truth. The point Biden was making was that the less than elite did not have “rich” envy. They wanted to be rich themselves, but that they had “opportunity” envy and the GOP was bent on restricting their opportunity to succeed, whether it was access to education or to jobs in the face of layoffs caused by venture/vulture takeover capitalists' uncaring business practices.

The GOP's response, sneering that Obama's record as a community organizer disqualifies him to the president, hit me as strange, especially since they also try to define him as an ivory tower professor who is out of touch with the real world. What in the world is wrong about getting down and dirty with struggling people to understand how those who are different than you think, feel, and struggle?

More of that experience might have helped Romney connect with more people instead of trying to pose of one of them. It did not work. The GOP launched a diversionary strategy, that any attack on Romney's decisions at Bain Capital is an attack on all private equity corporate takeovers and capitalism as a whole. The Obama team fumbled a response, saying they were only attacking Romney's “values” and intensified attention to the collateral damage his decisions or his company caused to working people who lost income, health care, and pensions. Lately, Obama's surrogates have tried to clarify that their attack was not on capitalism but to make the case that Romney himself had not translated his expertise to good public policy.

The debate could be recast in terms of who has a sense of “community interests.” That is not the drumbeat of the Tea Party whose single-minded attention is to their own financial interests, whether it is opposing higher taxes or any restraint on their freedom to do what they please that benefits their own interests. I stumbled on a quotation posted on the Republican Men's Club website that defines what it means to be Republican in politics in today's society:

“… it requires listening to constituents and understanding their role in the ‘global' perspective. Leadership is involvement: the prudent application of wisdom for the benefit of the whole, or at least as many as possible while ensuring that those in the minority have a say …”

Many investment bankers have successfully taken their skills to government and the Obama administration, but they brought with them a sense of community they already possessed. Romney has not demonstrated that his sense of community extends past his skills to analyze a balance sheet and to act on the bottom line. Political leadership also demands a cost benefit analysis of community impact.

For more go to www.mufticforum.com, www.mufticforumespanol.blogspot.com 

Does Mitt Romney's expertise translate to his ability to lead the US economy?

My column in the Sky Hi Daily News today:
We live in a short-hand, sloganeered and sound bite world but it is worth our time to get into the weeds, especially when complex issues of the economy are involved.

I took a deeper look at some recent sound bites regarding the auto bailouts, Wall Street regulation, and debt/budgets  and came out of the wonky weeds shaking my head. Mitt Romney's expertise has not translated into good judgment, or good public policy, or even good banking practices.

Let's look at Romney's claim that a private sector auto industry bankruptcy would have been better than the Obama bailout. It is fundamental to his claim he was a fixer of the economy's problems and a job creator and it illustrates why a banking perspective does not always make for good public policy. The number of jobs that could have been lost in 2009 if GM and Chrysler went under (including the ripple effects to parts suppliers and others), would have been 3 million, auto executives predicted. If Obama had not fixed it with the government bailout, we would still be looking at an unemployment rate in 2012 much higher than 8.1 percent.

The fix Romney advocated publicly in 2009 and still defends was to let the private sector provide the capital for a structured bankruptcy. There must be capital provided by investors in a managed bankruptcy, or the enterprise has no way to pay its workers, parts suppliers, or any other costs of doing business. It padlocks the gates and employees become the unemployed.

The reality in 2009 was there was no private capital to do it. Either Romney was being deceptive to make a political point or he was blind to the investment climate. Even when challenged later to name any private investors willing and able, he couldn't. The Obama administration understood that and provided the capital by the way of government money (the bailout) so the factory gates remained open while needed changes were made. The U.S. auto industry has roared back and many of those laid off are now back to work.

This month JP Morgan-Chase lost over $2 billion in proprietary trades gone bad. Luckily JPM is strong enough to survive, but the same could not be said for other banks. Had Wall Street Reform (Dodd-Frank) with its Volcker rule been implemented, it may have prevented certain kinds of proprietary trades that risk a bank's own funds. If trades were simply bad judgment calls that could take down a bank, the reform would provide a way to wind down a big bank without taking down other banks, avoiding what  caused the 2008 crash and bailouts. The financial service lobbyists have successfully delayed implementation of Wall Street reform that includes the Volcker rule. Romney's position? Repeal Wall Street reform. Bad business, Mitt Romney.

Coming to a head this summer is the Ryan plan and GOP's extreme reliance on austerity as the solution to both the budget and debt. Romney has called this approach “marvelous.” The GOP's reliance on cuts in social programs while increasing Pentagon spending has been condemned as immoral by the Catholic Bishops because it cuts into the poor's safety net. This is the same single-minded reliance on cuts to recover from the 2008 crash that Europe has tried, with Great Britain and seven countries in the Euro Zone now facing a double dip recession, higher debt, and no growth.  

The GOP scares the pants off of voters, pointing to the Greek situation with “we too could go their way if we do not get our debt under control.”  Even Democrats agree we must solve the debt problem. The question is “how?” The GOP identifies the right problem and advocates the wrong solution. To tackle debt takes a balanced approach like Simpson-Bowles of some stimulus and some austerity as Obama has done. Relying on cuts alone cripples recovery. That is the lesson Romney and the GOP should take from Europe.

For more, visit www.mufticforum.com, www.mufticforumespanol.blogspot.com

Obama should embrace Simpson Bowles

My column in the Sky Hi News today
As expected the presidential election is coming down to the 5-6 percent who either are not focused on the campaign or who are just plain conflicted.

On many of the major issues and ideology, most voter opinions are already set in concrete. The problem facing both Mitt Romney and President Obama is how to keep the concrete firm and still snag the elusive middle.

The president has some work to do, but his options are not as big as some gambles he has already taken, and embracing Simpson-Bowles debt reduction proposals by name is one good bet.

Obama has a record of taking risks and winning. Reflecting on what has happened this last week regarding the president's endorsement of marriage equality, events moved so quickly he went with his gut, but the gut may be a winner when the dust settles. Like Obama's decision on how best to get bin Laden that gambled his re-election chances, or taking the risk to bail out the auto industry, his gut coupled with good analysis and faith in our special forces and changes forced in business practices turned out to be   gambles that paid off.

Marriage equality is a gamble with only 50 percent in agreement. Evangelicals, Southerners, the LGBT community, and social libertarians had already dug themselves in. Others who were not with him on this issue, like members of the black and Hispanic communities and young voters, are committed to him for other reasons. The gamble is that    Rust Belt blue collar workers who were grateful for the auto bailouts and women would likely put their own economic and health access agendas ahead of marriage equality issues in deciding whom to support.

To appeal to moderates, Obama needs to endorse Simpson-Bowles debt reduction plan by name, because just about everyone in both political parties and in between do feel there is a need to tackle debt. Opinion polls are already showing support, with voters approving Simpson-Bowles. It is not that big of a gamble.

By embracing Simpson-Bowles, the president can put a brand name to his policies. He can then pit Simpson Bowles against the GOP-Ryan plans and make case that Simpson-Bowles is far more fair and balanced when it comes to   who or what gets hit with the cuts and who pays more or fewer taxes.

Obama has already embraced many of the details in Simpson-Bowles. However, there is still left the thousand pound gorilla: “entitlements” and support of Simpson-Bowles implies support of their proposals.

I hate the term “entitlements” because it makes me feel guilty that I am a beneficiary of two of them, Medicare and Social Security., From time to time ill relatives have also been able to live out their lives humanely, first on Medicare and Social security, and later on Medicaid after assets ran out. We had put in our money and time and earned them or desperately needed them. Many on the conservative side  have been or will be beneficiaries as well. That is why  Obama and many on the right pussy foot around the issue, delay decisions for lame ducks to tackle, or exempt from changes current beneficiaries.

Potentially to their downfall, Rep. Paul Ryan, and the House Republicans have proposed a solution that Romney called “marvelous.” However, what policies they propose, especially regarding Medicare, are potentially politically toxic. Obama can bite the bullet and endorse the Simpson-Bowles proposal to raise retirement age to 70. He should contrast that with the Ryan plan to privatize, voucherize, and leave future beneficiaries stuck with higher co-pays when they do get their “entitlements.” After all, fellow retirees, we are so much healthier than our predecessors. The next generations will be able to work a few more years, too. It is a haircut we can more comfortably ask them to take.

For more, go to www.mufticforum.com and www.mufticforumespanol.blogspot.com.

and Romney wants to roll back Wall Street reform?

Romney deserves a raspberry for a  policy he promotes.. to roll back  Obama supported  Dodd-Frank Wall Street reform legislation …freeing big banks from more regulations so  they could resume the same practices  that led to the crash of 2008.   This month a revered Wall Street firm,  JP Morgan, lost   two billion dollars of proprietary trades gone bad. Luckily JPM is strong enough to survive, but the same could not be said for other  banks. . Had Wall Street Reform with its Volcker rule been implemented, it would not have happened because  the rule would keep  banks too big to fail from investing their own proprietary funds in certain risky instruments as an insurance policy,  betting  against their own customer’s  investment interests.  The financial sector  lobbyists have successfully delayed implementation of  Wall Street Reform that includes the Volcker rule.  The result: JPMorgan was a victim of their own practices that the Volcker rule could have prohibited if worded correctly

Romney’s banking  expertise does not automatically translate to good judgment, or good public policy, or even good banking practices.....