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August 02, 2009

To Pay or Not to Pay

By: Bernard Chazelle

People fail to appreciate how tough it is to run the government. Here are two questions Treasury officials and politicians will soon have to answer:

  • Should a Connecticut trader receive $100 million in executive pay from a bank that would be dead had it not received $45 billion in taxpayer money? Apparently, the guy's genius was to drive up the price of gas to $4 a gallon. Does he deserve 100 million bucks from you for that?
  • Should unemployment benefits be extended for 1.5 million jobless Americans who will otherwise run out of money by the end of the year and fall into destitution and, sometimes, homelessness?

The New York Times features both stories on its front-page but never connects the two. It does a decent job explaining the complexity of the issue, however. If the trader fails to be paid, it'll get truly ugly: the guy will go trade somewhere else! On the other hand, if mom and dad don't get their unemployment benefits, things are not quite nearly as bad: only their kids will die. Thank god I am not in government having to make tough choices like that!



tent_city.jpg


Tent city outside Los Angeles. Nice touch: residents are required to wear color-coded wristbands.

UPDATE: Wristbands are color-coded: blue to indicate "residents" from the area; orange to show they need more documentation; white to say they have one week to leave.

This ain't the Warsaw ghetto, I know, but the stink of the police state is unmistakable nonetheless. Step 1, strip away human dignity...

"When my husband gets out of jail he can bring my marriage certificate; will that count?" asked one tearful woman.

Another resident, clearly confused, seemed relieved to get a white band -- not understanding it meant she had to leave.

Pattie Barnes, 47, who had her motor home towed away last week, shook with anger.

"They are tagging us because we are homeless," she said, staring at her orange wristband. "It feels like a concentration camp."

— Bernard Chazelle Posted at August 2, 2009 11:18 AM
Comments

Here in the UK, the government is considering implementing some modicum of oversight of the banking industry by requiring that the income and investment worth of the top five non-board officers of banks and investment houses be made public. Fucking rich bastards are understandably aggrieved, and are threatening, as they always do, to take their God-given and irreplaceable talents elsewhere if such a horrendous thing were to come to pass.

Perhaps if we rounded up a few and put their heads on pikes outside the Bank of England it would be a better incentive.

Or better yet, throw all the fuckers out, and put a few heads along the White Cliffs as a warning for the rest to stay away.

These people — and I use the term loosely — make we want to vomit.

Posted by: NomadUK at August 2, 2009 12:07 PM

Great post. That contrast can't be overemphasized.

NomadUK, not all the rich are bastards, and my own rather cynical view is that if heads ever go up on pikes they will probably be the wrong heads. Not that anyone should listen to the pissing and moaning by the traders and the executives. They made this mess, so they should shut up and make some sacrifices.

And the poor, who didn't make it, should be taken care of.

Posted by: N E at August 2, 2009 12:40 PM

Color coded to what end? "Recently homeless," "often homeless," "deserving homeless," "undeserving homeless," "just visiting relatives"?

Remember deserving poor and undeserving poor? Was that Reagan's creation?

Posted by: catherine at August 2, 2009 12:40 PM

You're close Catherine! I'll update the post.

Posted by: Bernard Chazelle at August 2, 2009 01:18 PM

Will we never have enough of these color codes> As Pattie Barnes observes, we are on the way to concentration camps - and worse.

Posted by: Robert Della Valle at August 2, 2009 02:00 PM

There may be some wealthy folks who aren't pricks or pigs. Likely, if there are, they are inheritors of their wealth.

I have never met a 'self-made,' rich entrepeneur who wasn't an asshole (I used to move in the periphery of such circles), and whose knees I didn't immediately want to jelly with my Louisville Slugger.

Posted by: woody at August 2, 2009 03:30 PM

I don't think the ultra-rich should be pike'd, more like we should put them all on a reality TV show where they are stripped of money and connexions, and live unemployed together in tenements.

Posted by: Cloud at August 2, 2009 04:02 PM

ALL they gotta do is just leave town, NO problem. Ask the Mayor, he'll tell YOU the same thing.

Posted by: Mike Meyer at August 2, 2009 04:03 PM

Woody wrote: "There may be some wealthy folks who aren't pricks or pigs. Likely, if there are, they are inheritors of their wealth."

Well, my wife has a friend who married a Harvard business student a bit under twenty years ago, and he was from England but not from money, which I know for certain because their statewide wedding reception was at my extremely modest and unpretentious home (though the wedding itself was pretty nice, I think--dunno, for some reason that I forget I had to babysit while my wife attended on that one). The thing is, he went on to become a billionaire, based on the fact that I read a couple of years ago that his company had donated 500 million pounds to his wife's (my wife's friend's) charitable foundation. That caught my eye, because that's quite a bit of cash. I find it strange remembering the gathering at my house now. (Had I only known, I would have made him pay!)

I only met him once, and maybe he is in fact a prick as you suggest he must be, but giving away five hundred million pounds to combat poverty and world hunger is pretty decent behavior by prick standards. And I do know my wife's friend, and she's a super person.

For the record, I don't think people should be able to make amass fortunes like that, and whether or not someone is in fact a peach of a fellow, they indirectly have blood on their hands if they have done that, because behind all that trading and all those market operations there is a real world of human beings. Those hedge fund managers indirectly determine plant closings and pension raiding and all the rest.

Where I disagree is that I don't think the problem is that the rich are ALL pricks. I don't even think that is principally the problem. The problem would exist to a large extent even if the rich were all great people (which of course they are not).

Posted by: N E at August 2, 2009 06:51 PM

Remember deserving poor and undeserving poor? Was that Reagan's creation?

I think Reagan favored the term, "truly needy".

Posted by: cemmcs at August 2, 2009 07:21 PM

Immediately above the article about the $100 million bonus baby was another article about the four suicides among veterans of the 1451st Transportation Company, assigned to protect convoys of "trucks full of gasoline, building materials and other supplies" in Iraq.

According to the article, "Suicide is a complex act, a convergence of troubled strands. Researchers who have examined military suicides find not a single precipitating event but many: multiple deployments, relationship problems, financial pressures, drug or alcohol abuse. If decades of studies on civilian suicides are any indication, soldiers who kill themselves are also like to have a history of emotional troubles like depression, post-traumatic stress disorder or another illness."

It tells the story, among others, of one Sgt. Blaylock, who had been given a discharged from the Army for "emotional problems", yet later called back into service when the Army needed bodies for Iraq, -- despite the officially voiced misgivings of several of his fellow soldiers that he was too fragile for combat. Blaylock subsequently killed himself.

Gee, I can't see any connection between the stories about the guy who gets $100,000,000 of taxpayer money for manipulating the price of oil and the one about Sgt. Blaylock's being sent to Iraq, can you?

Posted by: John Sundman at August 3, 2009 01:08 AM

So, why does Ms. Barnes prefer staying in a tent city outside Los Angeles wearing her color-coded wristband - instead of moving, pitchfork in hands, towards Mr. Hall's Fairfield 7,300-square-foot Greek Revival mansion with 82-foot concrete sculpture on the front lawn?

BTW, is it really 82-foot sculpture? This is something, isn't it. I checked: Michelangelo's David is a 17-foot sculpture. I don't think Louis XVI had any 82-foot sculptures...

Posted by: abb1 at August 3, 2009 06:16 AM

Nero had one of himself which stood over 110 ft. tall in the vestibule of his Domus Aurea. But this was before the Roman Senate declared him a public enemy.

Too bad the U.S. Senate are such lapdogs by comparison.

Posted by: Paul Avery at August 3, 2009 06:44 AM

Legal fights tend to bring out details like "82 feet high". Is it 82 feet high? Who knows. From the story, though, it's clear he couldn't become President -- he was born in England. Wait till Lou Dobbs finds out that he's taking his bonus out of the mouths of American plutocrats!

Posted by: drip at August 3, 2009 06:48 AM

According to wikipedia, Christ the Redeemer in Rio is 120 ft tall, including the pedestal. So, it would probably be around 90 ft without the pedestal. But that thing is HUGE.

Man. Mr. Hall's 82-foot sculpture has gotta stand as a symbol of these times. Or maybe it could be hanged on the statue of liberty's torch or something.

Posted by: abb1 at August 3, 2009 08:45 AM

Ah, I see. It's not vertical, it's just a bunch waves: "It is approximately eighty feet long and consists of seventeen variably sized wavy sections of concrete, some with protruding rebar which rest either on the ground, another section, or both. The maximum height is approximately four feet."

Posted by: abb1 at August 3, 2009 09:06 AM

abb1: "So, why does Ms. Barnes prefer staying in a tent city outside Los Angeles wearing her color-coded wristband - instead of moving, pitchfork in hands, towards Mr. Hall's Fairfield 7,300-square-foot Greek Revival mansion with 82-foot concrete sculpture on the front lawn?"

Because that would be disorderly conduct, and a kindly police officer would have to ask her for ID, then arrest her when she refuses to show it and starts yelling at him. Which is only what she should expect.

Posted by: Duncan at August 3, 2009 09:44 AM

"Will that count"? God damn them, god damn them, and god damn them, for these people's fear. And for the fear we all feel these days.

Is there a course I can take to give me the skills to damn someone? Oh, yes, please.

Posted by: catherine at August 3, 2009 10:26 AM

I've been looking for an opportunity to share this one from, "The Daily Tribune - Cartersville, GA."

http://nl.newsbank.com/nl-search/we/Archives?p_action=doc&p_docid=129CF737228C5858&p_docnum=1

"A Bartow County Sheriff's Office deputy arrested Wednesday morning a homeless man found behind a Cartersville restaurant.

According to a BCSO report, the deputy was told by staff members at Martin's Restaurant, 896 Joe Frank Harris Parkway, that an unknown man had been staying behind the business's Dumpster, adding that they had seen a tarp and beer cans behind the trash receptacle for the last few days.

The deputy found 57-year-old Jeffery Lynn Graham lying on a tarp. He also noticed a strong odor of alcohol coming from Graham, a 24-ounce beer next to him on the ground, and human waste on the ground and fence near the Dumpster.

Graham was arrested for disorderly conduct."

There you are, Disorderly conduct takes care of the homeless. If the guy's shit didn't stink like the rest of us and he'd been drinking Desani rather than a beer he'd probably been OK, don't you think? Kinder and gentler? - he's got a home now. No drinking a beer here without a home to hide it in, that a teach ya.

Posted by: knowdoubt at August 3, 2009 10:32 AM

"I don't like the sound of these 'ere "boncentration bamps""

Posted by: I do not recommend this site at August 3, 2009 10:56 AM

Oh good lord - the wrıstbands are lıkely for the safety of these poor unfortunates

Does a blue one repel tigers?

Posted by: Happy Jack at August 3, 2009 12:12 PM

Duncan, that certainly wouldn't be disorderly conduct, that would be a riot and city cops probably wouldn't be sent to handle it.

Yeah, which reminds me: and while at it, why doesn't she take a bus to Cambridge and kick prof. Gates' pompous ass too. Because, apparently, Cambridge cops are easily cowed.

Posted by: abb1 at August 3, 2009 12:43 PM

I think the statue in question is 82-feet long, not high (which is more consistent with a 7300 square foot mansion). And if it's the same one, in my opinion it's not much to look at. (Follow the link and scroll down to see it.)

http://www.nytimes.com/2008/01/04/arts/design/04kief.html

Fittingly, the artist's theme appears to be wreckage. I wonder if Mr. Hall sees the humor in that.

Posted by: N E at August 3, 2009 02:56 PM

America's Internally Displaced Persons=AIDPs and the proplem is just going to grow. One of the MANY and varied benefits of a crashing economy. Who could have known?

Posted by: Mike Meyer at August 3, 2009 07:51 PM

I'm surprised to find myself the only commenter willing to defend the city officials here.

I read a couple of stories about the tent city (in Ontario, CA, which was initially confusing to me, sitting at my computer in Ontario, Canada). The land seems to be city land, adjacent to the airport. The stated purpose of the wristbands is to limit the tent city spots to the homeless of Ontario -- meaning, presumably, people who have resided in Ontario for some significant period before coming to the tent city.

If I were competing for one of a limited number of spots in a tent city, I'd want there to be a system in place instead of a free-for-all. Could the city free up additional land for the influx of homeless people, who have apparently come from as far away as Florida upon hearing of the tent city? Probably. Could the city workers continue to service these hypothetical additional tent cities -- cleaning out the toilets and garbage bins, and so on? Probably not, unless the city hired additional workers. But this is just a classical collective action problem -- why should one city in Southern California become a magnet for homeless people across the country and have to bear those costs by themselves? This is a national problem, and the federal government should be dealing with this kind of thing, because otherwise you just get a race to the bottom, with already lean localities competing to be more inhospitable with prospective homeless settlers. This is how it went during the last Depression, and it was ugly.

The tent city is analogous to government-provided housing. In a Section 8 housing project, you need a key or pass to enter the building. If a security guard finds you inside and asks you for ID, you need to show some proof that you live there. Ditto for a private apartment building. How is this different from a wristband?

Am I missing something outrageous about this story that changes the moral calculus here? Because I'm not feeling the outrage; instead, I'm happy to hear that the city is trying to make the best of a bad situation and give the homeless a place to set up camp with at least rudimentary rationally-managed facilities (toilets, garbage collection, etc).

Posted by: Picador at August 4, 2009 10:10 AM

Picador: Wristbands aren't the problem, a tent city in the middle of town is the problem. WHY do homeless bother to CROSS THE COUNTRY to camp in LA. A homeless person has an almost impossibly tough time traveling that far. No money to just catch a plane, gas is expensive and would probably involve carpooling, a bus ticket would cost at least $200+ bucks, hitchiking is miserable and dangerous, so WHY MAKE THE EFFORT? IS life on the street in California that much BETTER than street life in Miami?

Posted by: Mike Meyer at August 4, 2009 01:37 PM

Mike for some the obvious isn't so apparent. You should try to be more understanding.

Posted by: Coldtype at August 4, 2009 01:54 PM

Coldtype: My questions are true questions. I've lived on the street before, for YEARS in fact. In fact I've camped downtown in both LA and Miami. Slept in cardboard boxes in both places( and many others in between), made the trek, by bus, car, hitchiking, and walked. As of THIS moment I can see absolutely NO reason for a homeless person to make such an effort to live in THAT tent city, EXCEPT its turned into "The Big Rock Candy Mountain" that the Hobos sing about. Maybe medical services exist there for those poor folks in "Good Ole Cal"? Maybe some kind of Homeless Movement?
The cops harrass the homeless the same on both coasts, the population, as a whole, is just as unfriendly to the homeless on both coasts, food, clothing, shelter, and cleanlyness is equally near impossible on both coasts, so WHY move?

Posted by: Mike Meyer at August 4, 2009 02:39 PM

N E,

Thank you sincerely for your wisdom. I'm prone to the 'heads on pikes' solution. Fun to visualize, but pointless.

IB

Posted by: Iron Butterfly at August 4, 2009 02:48 PM

Mike:

Picador: Wristbands aren't the problem, a tent city in the middle of town is the problem. WHY do homeless bother to CROSS THE COUNTRY to camp in LA. A homeless person has an almost impossibly tough time traveling that far. No money to just catch a plane, gas is expensive and would probably involve carpooling, a bus ticket would cost at least $200+ bucks, hitchiking is miserable and dangerous, so WHY MAKE THE EFFORT? IS life on the street in California that much BETTER than street life in Miami?

I think Bernard's complaint is different from yours. He voices concern about the "police state", a concern which doesn't seem to overlap with yours. While I'm immensely concerned about both authoritarianism and oppression of the poor in America (where I grew up), and this article is certainly troubling as a symptom of how bad the economy is getting, I differ from Bernard in that don't see it as indicating a corrupt or unfair attitude on the part of the city authorities who set up this camp. Unless, as I said, I'm missing something.

Posted by: Picador at August 4, 2009 04:24 PM

PS - It may be that I'm a bigger fan than Bernard of certain conformist behaviours and top-down management strategies for prioritizing the distribution of scarce resources. Standing in line, while sometimes pathological when undertaken for no reason (e.g. when an automated appointment-scheduling system would be more efficient), is dear to my heart as a social convention that allows civil society to function. My move to Canada from the States makes a lot of sense given this prejudice: people here are fiercely egalitarian, and also fierce advocates of Following The Rules.

In the States, of course, line-standing has reached the breaking point as a social convention, as it is a Prisoner's Dilemma that has now acquired a critical mass of defectors. Poor people in the US, in my experience (mostly in childhood and adolescence), know that the system will gladly let them fall through the cracks, and this makes them very aggressive when competing with the rest of the crowd; they are thus, as a whole, disinclined to stand in line. As I grew older, attended fancier schools in wealthier cities, and consequently had more and more exposure to the super-wealthy, I found to my surprise that they do not stand in line either, as they believe themselves entitled to preferential treatment. I was also surprised to find that their defection, in contrast to that of the poor, almost always works in their favour.

Thus, I believe that standing in line has become a sucker's game in the US, not because of its inherent bad qualities (which Bernard seems to attribute to it here), but because it is a behaviour that both the ruling class and the downtrodden opted out of a long time ago, although it is still frequently imposed upon the latter, as in the instant news article. Accordingly, while I agree with Bernard in seeing the wristband system as a troubling symptom of inequality, I believe that the answer lies in enforcing this kind of rational resource management for everyone (including the rich), not eliminating it for everyone.

Posted by: Picador at August 4, 2009 04:41 PM

"Accordingly, while I agree with Bernard in seeing the wristband system as a troubling symptom of inequality, I believe that the answer lies in enforcing this kind of rational resource management for everyone (including the rich), not eliminating it for everyone"
-Picador

As the bailouts of the Wall Street hustlers and the current "debate" over health-care reform make plain, enforcing rational resource management in a game rigged by and for the wealthy is just a game of charades.

Posted by: Coldtype at August 4, 2009 05:29 PM

Picador&Coldtype: AGREED. Though my question is still unanswered, WHY?

There's nothing surer
The Rich get richer
And Poor get poorer
In the meantime
The in between time
Ain't WE got fun?---Old Song

Posted by: Mike Meyer at August 4, 2009 05:40 PM

On the subject of equality and inequality, the book below looks interesting to me, though it isn't available in the U.S. yet except for preorder so I haven't seen it. (I think it is in Britain.) It strikes me as a neglected approach, especially by economists, who seem generally in thrall of inequality.

The Spirit Level: Why Greater Equality Makes Societies Stronger (Hardcover)
by Kate Pickett (Author), Richard Wilkinson (Author)

Posted by: N E at August 4, 2009 08:27 PM

Although "The Spirit Level: Why Greater Equality Makes Societies Stronger" is only available for pre-ordering from amazon.com, amazon.ca has it in stock.

And there is a great deal of downloadable information about the topic from the authors at

http://www.equalitytrust.org.uk/resources

Posted by: mistah charley, ph.d. at August 4, 2009 10:05 PM

mistah charley, ph.d.---thanks!

Posted by: N E at August 5, 2009 07:31 PM