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Tuesday, June 19, 2018

On the Methodist Complaint against U.S. Attorney General Jeff Sessions on an Immigration Policy

Assessing whether a Christian denomination’s formal discipline is being used for religious or politically-ideological purposes is fraught with difficulty. Certain governmental policies, such as genocide, clearly violate Christian teaching, such that government officials charged with implementing such policies could legitimately be sanctioned on religious grounds without it being thought that a political or partisan difference is the actual basis of protest. As the harm to others in a given policy lessens, the specter of ideological opposition as the actual motivator increases as a possibility. In 2018, 640 United Methodists filed a complaint to their church charging U.S. Attorney General Jeff Sessions with having violated the Church’s Book of Discipline, its code of laws and social principles, on account of the alleged “child abuse, immorality, racial discrimination, and ‘dissemination of doctrines contrary’ to those of the United Methodist Church.”[1] Sessions had been tasked with implementing the U.S. immigration policy of separating children from their parents at the border. At the time of the complaint, over 2,000 children of illegal aliens were being held by the U.S. Government as their parents were being prosecuted.


The full essay is at "Methodist Complaint on Immigration."

Tuesday, June 12, 2018

Ethical Leadership in the Roman Catholic Church: The Case of the Chilean Abuse Scandal

Leaders taking an ethical stance, even en masse, may find themselves risking their very positions, including the associated perks. In May, 2018, “all Chile’s 34 [Roman Catholic] bishops offered to resign en masse . . . after attending a crisis meeting with [Pope Francis] over allegations of a cover-up of sexual abuse” in the South American state.[1] The pope could have accepted all of those resignations. Instead, he accepted the resignations of three Chilean bishops, including Juan Barros of Osorno, Cristian Cordero, and Gonzalo Garcia, a month later. The ethical leadership, I submit, was not evinced in the pope’s decision to get rid of the three sordid clerics, but, rather, in the other bishops who had been willing to take a stand even at great personal loss. Indeed, the pope admitted he had made “grave mistakes” in the Chilean sexual abuse scandal. Had he been guilty of protecting his friends?

The full essay is at "Christian Leadership." 

See: Christianized Ethical Leadership, available at Amazon


[1] Reuters, “Pope Francis Accepts Resignation of 3 Chilean Bishops Following Sex Abuse Scandals,” The Huffington Post, June 11, 2018.

Judge Allows ATT Purchase of Time Warner: Vertical Integration Escapes Anti-Trust Objection

Typically horizontal mergers, as when one company merges with another that makes similar products, have trouble when it comes to anti-trust, restraint of trade, objections. The go-ahead of the ATT merger with Time Warner in mid-2018 suggests that vertical combinations, such as when distributor buys a content-creator, survive on anti-trust grounds. Even if trade is not restrained, another problem is present—that of conflicts of interest. Anti-trust law is oriented to preventing restraint of trade rather than such conflicts. Accordingly, just because the ATT merger survived on anti-trust grounds does not mean that a regulatory gap did not exist at the time.

Slovak Resistance to Expanding the E.U. Bailout in 2011

Richard Sulik, Parliament Speaker of the Slovakian legislature, argued that the only real solution to the debt crisis in the E.U. was rigorous enforcement of the E.U. regulations on budget deficits and public debt. He had been particularly angered by his state, the second poorest in the E.U., having to bail-out a richer state that had consistently violated the E.U. regulations. Additional debt, he insisted, was not a way out for the PIGS. Slovakia, after all, had to adhere to strict limits on everything from budget deficits to inflation rates in order to be able to adopt the euro. “Now when I see what is being allowed for Greece and Italy, it really makes me angry,” Sulik admitted. “We have to pay because of this double standard. It’s a real injustice.” Indeed it was. Bailing out Greece so the state would not default effectively rewarded that state government for profligate spending and tax avoidance in violation of the E.U. regulations.  

The full essay is at "Slovak Resistance."

Balancing Budgets: Italy vs. Wisconsin

In what could be dubbed a tale of two states, Scott Walker of Wisconsin bragged about bringing the budget into balance without raising taxes while Silvio Berlusconi broke his pledge not to raise taxes in order to balance his budget for 2013. Walker relied on spending cuts and constricting the collective bargaining of government employees, while Berlusconi agreed to a package of tax increases, spending cuts and fewer labor protections to make up for $76 billion (54 billion euros) by 2013. The tax increases include raising the value-added tax from 20 to 21 percent and imposing a “solidarity tax” of 3 percent on state residents who earn more than $420,000 (300,000 euros). The latter tax would run through 2013. At a news conference in August, 2011, “Berlusconi acknowledged that he had pledged never to raise taxes, but that the attention of world markets had forced him to do so.” Was breaking his pledge a vice or a virtue?

The full essay is at Balancing Budgets

Was U.S. President Obama the Antichrist?

In the twentieth century, Christian apocalypticism thought it saw the end of days in the midst of baleful signs, including historical biblical criticism, the return of the Jews to the Holy Land, evolutionary science, and the United Nations. In the United States, the consolidation of power in the federal government at the expense of federalism (and, theoretically, liberty as well) was apocalyptically taken as a precursor to the end. According to Matt Sutton, “As the government grew in response to industrialization, fundamentalists concluded that the rapture was approaching.” The trajectory, in other words, was viewed as headed toward a global super-state under the thumb of a seemingly benevolent ruler. Franklin D. Roosevelt’s “consolidation of power across more than three terms in the White House, his efforts to undermine the autonomy of the Supreme Court, his dream of a global United Nations and especially his rapid expansion of the government confirmed what many fundamentalists had feared: the United States was lining up with Europe in preparation for a new world dictator. This “leader would ultimately prove to be the Antichrist, who, after the so-called rapture of true saints to heaven, would lead humanity through a great tribulation culminating in the second coming and Armageddon.”

The full essay is at "Was Obama the Antichrist?"

A Trader Dreamed of Economic Collapse

Call it over-confident bravado or perhaps a lapse into utter transparency; trader Alessio Rastani’s comments on BBC give the rest of us a glimpse of the power behind the world’s thrones and how prone “the system” is to collapsing without a sufficient force geared to the viability of the system itself. In other words, it is amazing that the financial/governmental systems go on without more attention to them as systems rather than to micro self-interests. One might ask whether powerful self-interests are sufficient to keep the system from hitting the rocks. Apparently the answer is yes, though this is astonishing nonetheless. It is like a car somehow making its way down the street with one person in the car looking at pedal, another at the steering wheel, and still another at the speedometer. It is amazing if the car does not crash, yet somehow it managing to stay on the road.

The full essay is at "Economic Collapse."

Bank of America: Downsizing From Smallness

Three years after the near-meltdown of Wall Street in September 2008, Bank of America announced that 30,000 jobs would be eliminated. That amounts to nearly 10% of the bank’s total work force. Over all, BOA was planning to cut $5 billion in annual expenses. The reason is transparent: continued losses stemming from the bank’s acquisition of Countrywide in January 2008 in spite of the fall of the U.S. real estate market and the related losses on sub-prime mortgage-backed CDOs. What could Ken Lewis have been thinking? At least in the case of his acquisition of Merrill Lynch, which was agreed to in principle in September 2008, the investment bank had already sold its $30 billion of toxic assets for over $7 billion in July 2008.

The full essay is at "Bank of America."  

Friday, June 8, 2018

Is Modern Banking Fundamentally Flawed?

Jamie Dimon, CEO of JP Morgan Chase and board member of the New York Federal Reserve (a banking regulatory body), advocates not only that financial regulation reform is not necessary, but also that deregulation is the best course for the American financial sector. Meanwhile, JP Morgan lost $2 billion in an effort to reduce risk. President Obama quickly pointed out that if one of the smartest bankers in the room can preside over such a massive loss, then a deregulated financial sector would likely present us with an unacceptably high level of risk to the entire financial system (and economy). Elizabeth Warren suggested that relying on bankers to regulate themselves would not reduce the systemic risk. The alternative would seem to be strengthening financial regulation, even though—according to Sen. Dick Durbin—“the banks own Congress.”

The full essay is at " Banking as Flawed."

Market or Government: Which Should Reduce Systemic Risk in the Banking Industry?

If the five largest banks—JP Morgan, Bank of America, Citigroup, Goldman Sachs, and Morgan Stanley—are too big to fail and yet substandard operationally on account of their respective complexities (e.g., investment banking added to commercial banking), might it be that the market-based decisions of investors will relegate the giants, which by the way had price-to-book value ratios of between .37 to .77 in May 2012, thereby solving the problem of systemic risk?



Toronto Police as Aggressors at G-20 Summit

Police employees “ignored basic rights,” jailed people illegally, used excessive force and escalated violence at protests surrounding the G-20 meeting in Toronto in 2010, according to the Office of the Independent Police Review Director. The report could lead to charges against police employees and strengthen the hand of civil lawsuits filed against the police department. Because the police employees acted with an attitude of impunity, anything less than stiff prison sentences would be insufficient as a deterrent.

Thursday, June 7, 2018

The 2012 U.S.Trade Deficit: An Analysis

Coming in at 2.7% of GDP, the U.S. trade deficit fell to $107.5 billion in the third quarter of 2012—down 9 percent from the second quarter’s $118.1 billion, which was 3% of the economy at the time. The current account includes merchandise, services, and investment flows. The surpluses in services and investment were out-done by the deficit in merchandise to produce the overall trade deficit. According to the New York Times, the “improvement in the current account in the third quarter reflected a decline in the deficit on goods and a small increase in the surplus on services, led by a gain in foreign earnings made by financial services, insurance and professional services provided by companies in the United States. The surplus on investment earnings narrowed to $50.8 billion, down from $52.1 billion in the second quarter.” Most of the decline in the deficit on goods reflected a decline in the foreign oil bill, according to Paul Ashworth at Capital Economics.
Analysis is at "2012 U.S. Trade Deficit

ICE Bought NYSE: Profiting from the Rules?

“Tell me what the rules are, and I’ll make money with them.” This statement, made by Jeffrey Sprecher of Intercontinental Exchange, captures well the attitude that business practitioners should have toward government regulation in a republic. That is to say, businesses should be regulation-takers rather than makers. For the regulatees to make regulation to which they themselves would be subject is an oxymoron, or contradiction in terms. At the very least, it involves a conflict of interest. At the macro level, business as “regulation-maker” effectively turns a democracy into a plutocracy. Accordingly, the strategic use of regulation should pertain to the use side, rather than the regulating side. Crafting regulations—essentially dictating them to legislators or regulators—in order to make money from them takes the strategic use of regulation too far.
 The full essay is at "Profiting from the Rules on Wall Street."

Wednesday, June 6, 2018

The U.S. Military in Iraq: Were Human Rights Ignored?

Philip Alston, a United Nations human rights official, warned the U.S. Government in 2006 that he had received information indicating that Iraqi reports of American troops executing an Iraqi family were true. Five of the victims were children five years old or younger. According to Alston, the troops “entered the house [after a 25 minute gun battle], handcuffed all residents and executed all of them.” He noted that the troops attacked the house in part because they suspected that the family was involved in the killing of two American troops earlier in March, 2006. If this is true, both the vengeful attack and the subsequent investigation by the U.S. military, which concluded that the report of the execution was false, demonstrate what can go wrong when conflicts of interest are ignored.

The full essay is at "Human Rights in a Military Occupation."

Does a Supermajority Undercut Constitutionalism?

How “extreme” can a legislative supermajority get in its legislation? Can constitutional safeguards act as a check where a legislative supermajority can enact amendments at will? A judiciary protecting the rights of individuals as well as a people against over-reaches by a government is limited by constitutional provisions presumably set in stone yet actually in erasable parchment. Complicating an answer, the term extreme may be applied to a piece of legislation by one person and refused by another. I come from a medium-sized city in the Midwest, where extreme has been thought to apply to commuting to work by bicycle. Where a pathological fear of change grips a town, you don’t have to go far to find someone proscribing something or other as too extreme At the level of the U.S. governmental institutions, one political party might deem universal health insurance through extant private insurance companies as extreme—tantamount to demonic European socialism—while another party might view continuing to use private insurance companies as merely reformist rather than extreme. A supermajority can take advantage of such a difference in descriptive judgments to argue that a significant constitutional change is actually a minor change and thus not worth worrying about. 


How “extreme” can a legislative supermajority get in its legislation? Can constitutional safeguards act as a check where a legislative supermajority can enact amendments at will? A judiciary protecting the rights of individuals as well as a people against over-reaches by a government is limited by constitutional provisions presumably set in stone yet actually in erasable parchment. Complicating an answer, the term extreme may be applied to a piece of legislation by one person and refused by another. I come from a medium-sized city in the Midwest, where extreme has been thought to apply to commuting to work by bicycle. Where a pathological fear of change grips a town, you don’t have to go far to find someone proscribing something or other as too extreme At the level of the U.S. governmental institutions, one political party might deem universal health insurance through extant private insurance companies as extreme—tantamount to demonic European socialism—while another party might view continuing to use private insurance companies as merely reformist rather than extreme. A supermajority can take advantage of such a difference in descriptive judgments to argue that a significant constitutional change is actually a minor change and thus not worth worrying about. 

The full essay is at "Supermajority and Constitutionalism."

Thursday, May 31, 2018

Google Executives Evaded Jail Time in Brazil: Is Business Too Powerful?

In late September 2012, the Brazilian state police detained the head of Google’s operations in the state after the company’s management failed to act on an electoral judge’s order to remove videos from its YouTube site criticizing a candidate in a rural county election. Separately, a judge ordered Google to remove a religiously-offensive video, which had sparked riots in the Middle East, within ten days or face fines. Google’s lawyers claim that the company is not responsible for what users upload. Earlier in the year, Brazil’s government threatened the head of Chevron’s operations there with arrest and passport-confiscation after a small leak occurred in the company.

The full essay is at "Are people in international business above national laws?"


The U.S. Supreme Court: Too Much Ideology in Jurisprudence?

Should the electorate in a republic be able to remove Supreme Court justices due to their past decisions on particular cases? Can this basis be distinguished from removing a justice for judicial incompetence? One thing is clear: the general public does not have the technical expertise to perform a “supervisor’s evaluation” on a judge. Obviously, anyone can see that someone who skips work on a regular basis is not fit for the job, but this is different than evaluating a job by the technical criteria of the profession. Distinguishing between a particular decision and general judicial approach, for example, is more difficult. Moreover, it can be difficult to balance the rights of popular sovereignty (i.e., rule by the people) against the rule of law without respect to majority opinion.

The justices of the U.S. Supreme Court in 2012.

The full essay is at "Ideology Twisting Legal Reasoning."

Wednesday, May 30, 2018

Schindler’s List

In German-occupied Poland during World War I, Oskar Schindler spent millions to save 600 Jews from the death camps. In the 1993 film, Schindler’s List, the gradual transformation of the luxuriant capitalist is evident as the film unfolds. At the end,  he comes to an emotional realization as to the worth of money as compared with human lives. He realizes that had he not spent so lavishly, he could have saved even more lives. He realizes, in effect, his selfishness that had blinded him even to the obvious severe suffering of the Jews around him. The story is thus not simply that of greed giving way to compassion. 

The full essay is at "Schindler's List."



Questioning Universal Basic Income


The gist of basic income is that a government “distributes cash universally. As the logic runs, if everyone gets money—rich and poor, the employed and the jobless—it removes the stigma of traditional welfare schemes while ensuring sustenance for all.”[1] The “logic,” I submit, is flawed even if the basic idea is solid.

The full essay is at "Universal Basic Income."


1. Peter S. Goodman, “Inequality? California City Is First in U.S. to Try,” The New York Times, May 30, 2018.

Monday, May 28, 2018

Free Speech in the E.U.: Criminalizing Denials of Genocides


While the world continued to look on—like an impotent rich man who cannot afford Viagra—as a genocide was taking place in Syria (i.e., the systemic killing of a group—in this case, of pro-democracy demonstrators), France’s state senate approved a bill on January 23, 2012 criminalizing the denial of officially recognized genocides, which according to the state includes the Nazi Holocaust and the Turkish killing of Armenians beginning in 1915. In the twenty-first century, fining people and putting them in prison for not wanting to remember things so horrible evinces the same kind of nationalist thinking that had led the twentieth to be the bloodiest century. In contradistinction to that decadent century, turning a new leaf following the Arab spring in the twenty-first is a far better strategy.

The full essay is at "Free Speech Compromised in the E.U."

Extrapolating from the Arab Spring to Corporate Social Responsibility

Richard Branson, founder of Virgin Atlantic and a myriad of other companies, sees a natural extension or follow-through from the pro-democracy protests in the Middle East and North Africa to more corporate social responsibility. As much as I would like to think that the twenty-first century proffers a new world, I think we have to acknowledge the weight of the political, economic and social strictures that we have uncritically inherited.



The Russian Conscience on Human Rights in Syria

Russia’s foreign minister, Sergey Lavrov, warned on January 18, 2012, according to the New York Times, “that outside encouragement of anti-government uprisings in the Middle East and North Africa could lead to ‘a very big war that will cause suffering not only to countries in the region, but also to states far beyond its boundaries.’” A very big war, it would seem, with very big stick, would be the result of “outsiders” stepping in to protect the Syrian protesters from their own government. In fact, the Times reports that “Lavrov said Russia would use its position on the United Nations Security Council to veto any United Nations authorization of military strikes against the government [of Syria].” It made no difference to Lavrov that the United Nations, including the Secretary General, had “repeatedly called for Syria [to] end a crackdown on opposition demonstrators, which Arab League monitors say resulted in hundreds of deaths over the past month.” In other words, the U.N. was officially impotent in being able to act on the basis of its “demand” because one of its members has a veto.

The full essay is at "Russia on Human Rights."

Wednesday, May 23, 2018

The U.S. Federal Reserve as a Regulatory Agency

According to the Wall Street Journal, the Federal Reserve “has operated almost entirely behind closed doors as it rewrites the rule book governing the U.S. financial system.” The paper notes that this has been in sharp contrast to the trend at the Fed toward greater transparency in its interest-rate policies and emergency-lending programs. The complaint of a dearth of public meetings misses, however, not only the scripted nature of such displays, but also the more fundamental question of whether a central bank buffered from political pressure should play such a salient role as regulator. At the very least, the democratic deficit and a lack of accountability may be exacerbated by the Fed’s greater role as a regulator of banks—particularly after the major investment banks become commercial banks, and thus subject to the Fed’s regulations.

The full essay is at "The Federal Reserve as a Regulator of Banks: An Institutional Conflict of Interest."

Related books: 

Essays on the Financial Crisis

Institutional Conflicts of Interest


UN’s General Assembly as Nonbinding on Syria

According to the New York Times, “In a powerful rebuke to Syria’s government, the United Nations General Assembly voted overwhelmingly on [February 16, 2012] to approve a resolution that condemned President Bashar al-Assad’s unbridled crackdown on an 11-month-old uprising and called for his resignation under an Arab League peace proposal to resolve the conflict.” The reporter immediately undercuts his use of powerful by observing that the 137-12 vote (with 17 abstentions) is “a nonbinding action with no power of enforcement at the world body.” The “action” does represent “a significant humiliation” for Assad. I doubt very much if he felt humiliated. His UN ambassador “denounced the resolution as a politically motivated scheme to intervene in Syria by the Western powers and others who ‘would like to settle accounts with Syria.’” Altogether, the first two or three paragraphs of Gladstone’s article can be read in terms of logic as “X, not X.” Of course, the first X gets more attention, so the article gives the impression that the UN did something powerful when in fact the exercise was one of exposing the impotence of the world body.

The full essay is at "The Fecklessness of the UN."

Limiting Bank Size: Crude But Advisable

In February 2012, Tyler Cowen claimed in the New York Times that people across the political spectrum were “talking about splitting up America’s large banks.” At the time, I could discern no such talk, although this does not mean that it was not going on. As the Dodd-Frank financial reform law was being written in 2010, the option of splitting up banks like Bank of America, Goldman Sachs, and JP Morgan Chase was quietly but assiduously kept off the front burners. It is difficult to believe that the big banks would have relaxed in their efforts to relegate such threats in early 2012 as if the passage of the legislation in 2010 meant that more astringent options were no longer possible. In his article, Cowen includes some other questionable claims. Reading between the lines, he seems to have been “playing by the rules” in support of the big guys.

The full essay is at "Limiting the Size of the Big Banks."




Friday, May 18, 2018

Naked Royalty: Prince Harry and the Sun

In publishing naked pictures of Prince Harry on holiday in Nevada, the Sun in Britain ignored the warning from the press watchdog that had warned the Sun that it would be breaching a privacy provision in the state of Britain’s press code. That the warning followed an appeal to the Press Complaints Commission from St. James’s Palace, which is Prince Charles’s home and office in London, suggests that the warning came from “the firm” itself to protect one of its own.

                   
A naked royal hits the newsstands in Britain.         Tony Melville/Reuters

The full essay is at "Privacy and the Press."


Losing the Middle Class: An Educational-Industrial Policy

Beneath the headlines showing new figures on unemployment (which do not include the unemployed who are no longer looking for work or applying for unemployment compensation) is the story of the changing distribution of jobs in the American economy. That distribution in turn can give rise to cultural or societal changes. When the jobs in the economic middle are disproportionately lost, American society increasingly resembles a tale of two cities—and by this I do not mean Augustine’s heavenly and earthly cities though the realms of the “haves” and “have nots” could admittedly be called as such by materialists.


The full essay is at "An Educational Industrial Policy."

Frank Lloyd Wright: A Modern Renaissance Man

Perhaps no greater Renaissance man has been cited in American history than Thomas Jefferson. He wrote on the native plants of his country, Virginia, ran a plantation, designed buildings, founded a university, surveyed land,  was the head of state in Virginia, wrote a declaration of independence, and was the third president of the new American Union. More than two centuries after Mr. Jefferson, however, a cleft had become well-ensconced in American society between being an intellectual and a practitioner. The typical lawyer or physician, who holds two undergraduate degrees due in part to the political sense that a well-rounded citizenry makes a good electorate, has scant interest in intellectual endeavor. Indeed, one might even say that the “professions” place scant value on such activity; it is not “real work” or of the “real world.” The disdain is palpable, particularly in among the self-righteous in America. Yet Mr. Jefferson was able to bridge this gulf; so too can we. More contemporary examples can be cited to illustrate the mere possibility. The requisite delimiting "pruning" self-discipline might come as a surprise to people who presume that Renaissance breadth is borne of a wayward inability to "stay put."

The full essay is at "Frank Lloyd Wright.

Saturday, May 12, 2018

On Leveraging the U.S. Debt Ceiling: How the Market Mechanism Handles Trust

On May 9 2011, U.S. House Speaker Boehner insisted “on trillions of dollars in spending cuts, and no tax increases, as the price for rounding up enough votes to allow more borrowing and prevent the country from defaulting on its debt,” according to the Huffington Post. The Ohio Republican had “said failure to increase the borrowing limit [in the summer of 2011] would trigger a financial disaster for the United States and the world.” On May 12th in Congressional testimony, Ben Bernanke, chairman of the Federal Reserve Bank, cautioned against using raising the debt ceiling as leverage for getting a particular partisan policy-prescription on federal spending enacted into law. Richmond Fed President Jeffrey Lacker had told Reuters, “I do share the chairman’s concern that going up to the edge and playing chicken on the debt ceiling is not a wise strategy.”

The full essay is at "Leveraging the U.S. Debt Ceiling."

Strategic Thinking Beyond the Business Plan

“When smart people came up with ideas for well-conceived business opportunities, we said go for it. As always, organizational charts, management consultants, and business plans played virtually no role in any of this. My own strategic thinking I did mostly while showering or shaving.”

—Alan C. Greenberg, former Chairman and CEO of Bear Stearns

The full essay is at "Strategic Thinking Beyond Plans."

The Financial Crisis of 2008: On the Role of Negligence Breaching Fiduciary Obligation

Roger Lowenstein laments that “New York Times columnist Joe Nocera lamented that ‘Wall Street bigwigs whose firms took unconscionable risks … aren't even on Justice's radar screen.’ A news story in the Times about a mortgage executive who was convicted of criminal fraud observed, ‘The Justice Dept. has yet to bring charges against an executive who ran a major Wall Street firm leading up to the disaster.’ In the same dispassionate tone, National Public Radio's All Things Considered chimed in, ‘Some of the most publicly reviled figures in the mortgage mess won't face any public accounting.’ New York magazine saw fit to print the estimable opinion of Bernie Madoff, who observed that the dearth of criminal convictions is ‘unbelievable.’ Rolling Stone, which has been beating this drum the longest and with the heaviest hand, reductively asked, ‘Why isn't Wall Street in jail?’”
Lowenstein interprets these sentiments as implying “that the financial crisis was caused by fraud; that people who take big risks should be subject to a criminal investigation; that executives of large financial firms should be criminal suspects after a crash; that public revulsion indicates likely culpability; that it is inconceivable (to Madoff, anyway) that people could lose so much money absent a conspiracy; and that Wall Street bears collective guilt for which a large part of it should be incarcerated.”
Lowenstein argues that “(t)hese assumptions do violence to our system of justice and hinder our understanding of the crisis. The claim that it was ‘caused by financial fraud’ is debatable, but the weight of the evidence is strongly against it. The financial crisis was accompanied by fraud, on the part of mortgage applicants as well as banks. It was caused, more nearly, by a speculative bubble in mortgages, in which bankers, applicants, investors, and regulators were all blind to risk. More broadly, the crash was the result of a tendency in our financial culture, especially after a period of buoyancy, to push leverage and risk-taking to the extreme.”
Lowenstein also ticks off a loose monetary policy (i.e., extremely low interest rates), unaccountability at Fannie Mae and Freddie Mac, weak financial regulation, and an overconfidence in “risk management” methods in arguing that we should not be reductionist in ascribing the crisis to fraud alone or even primarily.  



The Electoral College Electing the U.S. President: A Check on Excess Democracy at the Empire Level

As a delegate in the U.S. constitutional convention, Governeur Morris stated on July 19, 1787 that the proposed National Executive (i.e. the U.S. President) should be “a firm guardian of the people and of the public interest.” (1)  Given this role, Morris maintained that it “cannot be possible that a man shall have sufficiently distinguished himself to merit this high trust without having his character proclaimed by fame throughout the Empire.” (2)   In other words, presiding requires a requisite credibility or stature that may be difficult to find in a territory on the scale of an empire.

The full essay is at "The Electoral College."

Friday, May 11, 2018

Malignant Narcissism in the Porn Industry: A Case of Flaccid Industry Self-Regulation

In early February, 2011, the Los Angeles city council voted unanimously to draft an ordinance that would require condoms to be used on the set of every pornographic movie made within city limits. “We can’t keep our heads in the sand any longer,” City Councilman Bill Rosendahl said. “These people should be using condoms. Period.” According to the New York Times, the "city law would be the first to impose safety standards specifically on the pornographic film industry, which has largely been allowed to police itself." Until the late 1990's, the industry went unregulated. On the heels of lawsuits filed against production companies by several actresses who had contracted H.I.V., the industry created the Adult Industry Medical Healthcare Foundation in 1998. The nonprofit clinic was financed by contributions from production companies and offered STD tests for the talent. Producers agreed not to hire performers who had not been tested within thirty days. Even though the county health department accused the industry's self-regulation of failing to protect the talent and their sexual partners, the production companies claimed that the system worked well. “This has been working for years,” said Steven Hirsch, founder of Vivid Entertainment. “If we saw people getting sick, we would go to mandatory condoms.” However, STDs remained rampant among pornographic film performers. Rates of chlamydia and gonorrhea are seven times higher than those in the general population.  Taking Steven Hirsch's own statement, it could be argued that waiting until an actor looks sick to require him to wear a condom is a bit like waiting until the horse has left the barn. “Testing just acts as a fig leaf for producers, who suggest that it is a reasonable substitute for condoms, which it is not,” said Michael Weinstein, president of the AIDS Healthcare Foundation.

A World Eschew: National Sovereignty Eclipsing Climate Change

U.S. President Obama announced after he left the UN global climate conference at Copenhagen in 2009 that five major nations—the United States, China, India, Brazil and South Africa—had together forged a climate deal. He called it “an unprecedented breakthrough” but acknowledged that the agreement was merely a political statement and not a legally binding treaty and might not need ratification by the entire conference.  Essentially, it was merely a statement of the five countries’ respective goals, as if someone had announced, “I want to lose ten pounds.”   The political statement did not meet even the modest expectations that leaders set for this meeting, notably by failing to set a 2010 goal for reaching a binding international treaty to seal the provisions of the accord.  Nor does the plan firmly commit the industrialized nations or the developing nations to firm targets for midterm or long-term greenhouse gas emissions reductions.



The U.S. Senate: What Is It Really?

In 1928, the Senate stopped the bill that would have given WWI vets their bonus then rather than in 1946.  Mass protests for weeks by thousands of vets on the U.S. Capitol may have swayed the U.S. House, but the Senate was undaunted: passage of the bill would be economically disasterous. Such a scenario is exactly what the delegates in the U.S. constitutional convention in 1787 would have predicted.  They designed the House to reflect the passions of the people, and the Senate as a check on such passion where it is intemperate.   Looking back at Shays’ Rebellion in Massachusetts, the delegates feared excess democracy.  No supporter of the Senate, Madison nonetheless points out that “a numerous body of Representatives were liable to err also, from fickleness and passion. A necessary fence against this danger would be to select a portion of enlightened citizens, whose limited number, and firmness might seasonably interpose against impetuous councils” (Madison’s Notes, p. 194).

The full essay is at "The U.S. Senate."

On the Virtue of a Constitutional Moment: Reassessing the American System of Government

A constitutional moment engaging the citizenry is urgently needed with respect to the system of government in the United States. In short, the citizenry should decide, as a people, whether to revert back to a federal system or to make the political consolidation that has ensued official. If the latter, Alexander Hamilton's suggestion that the states be districts of the US Government, whose energy he thought could not directly extend to the outer reaches of the empire (i.e., into the wilderness of states distant from the seat of the U.S. Government). This was Hamilton's view in the U.S. Constitutional Convention; his writings eventually published in The Federalist Papers were meant to sell the proposed constitution rather than to give his own proposal. His own view may have come to pass, though through incremental Congressional encroachment on the turf of the governments of the several states and concurring U.S. Supreme Court assuaging (or enabling) doctrines.  I submit that this process of change over many years has eventuated in a gap between the system of governance as it is and as it is to be constitutionally.  Whereas some people argue that we must revert back to the constitution following a "strict" construction, I believe we the people, as a people, should commence a constitutional moment of heightened attention and debate concerning whether we want centralized consolidation (i.e., no states), decentralized consolidation (i.e., states as districts), or federalism (which entails dual sovereignty and a balance of power between the general government and the governments of the states).  I believe the latter is the best suited for an inherently diverse empire-scale political union, but that the people reach a decision is the important point now.  For otherwise, we will continue to live a lie--to claim to be a federal system while actually being consolidated: essentially flying with  bad instruments. 

The full essay is at "Reassessing American Government."

Duplicity in International Affairs and Eclipsed Democracy: The Case of Afghanistan

Abdullah Abdullah withdrew on November 1, 2009 from the runoff election in Afghanistan.   Interestingly, Hilary Clinton and a spokesman for President Karzai characterized Abdullah’s withdraw in virtually identical terms—namely, as “his personal decision.”  Such a stance makes sense because both the American Government and Karzai had an interest in the Afghan electoral process being perceived as legitimate.   It is interesting, however, that the identical interpretation was instantly available to the press.   Perhaps U.S. Senator John Kerry had urged Karzai to agree to the runoff by telling him of a secret deal between the American Government and Abdullah that would have Abdullah pull out with a statement affirming the legitimacy of the electoral system.   That is, I wonder if the U.S. senator promised Abdullah something that essentially short-circuited the electoral process.  Karzai would look like a statesman without having to risk losing power, and Abdullah would get something rather than a probable election defeat.  The US would get stability in a Karzai government without having to worry about another controversial election. As it turned out, Abdullah did not keep to the script; he denounced the continued corruption in the continued occupants of the Karzai-hired electoral commission (a blatant conflict of interest for any electoral body, to be sure).   Also, the runoff itself was cancelled.  Was this part of the deal?  If so, the deal I suspect took place was very well hidden, or subterranean in nature and intention.

Afghani Electoral Fraud in 2010: A Precursor to the Protests in the Middle East?

The UN’s Electoral Complaints Commission recommended in 2009 that Afganistan’s Independent Election Commission invalidate 210 polling stations where the ECC found “clear and convincing evidence of fraud.”  The IEC in turn announced a run-off election because Karzai no longer had over 50% of the vote.  MSNBC reported that “the Karzai-influenced election commission may refuse to call for a runoff.” CNN reported that Karzai and Abdullah were trying to “cut some sort of deal” on a coaliation government that would have obviated, or skirted, a run-off.  Such a compromise would have been woefully inadequate from the standpoint of democratic process.

The full essay is at " Afghani Electoral Fraud."

Friday, April 13, 2018

How a Chairman of the Federal Reserve Made Strategic Use of the Media

Just as the US Senate was to take up the matter of Ben Bernanke’s re-appointment as Chair of the Federal Reserve in 2010, Time magazine came out with its announcement that he is to be its person of the year.  According to the magazine, “when turbulence in U.S. housing markets metastasized into the worst global financial crisis in more than 75 years, he conjured up trillions of new dollars and blasted them into the economy; engineered massive public rescues of failing private companies; ratcheted down interest rates to zero; lent to mutual funds, hedge funds, foreign banks, investment banks, manufacturers, insurers and other borrowers who had never dreamed of receiving Fed cash; jump-started stalled credit markets in everything from car loans to corporate paper; revolutionized housing finance with a breathtaking shopping spree for mortgage bonds; blew up the Fed’s balance sheet to three times its previous size; and generally transformed the staid arena of central banking into a stage for desperate improvisation. He didn’t just reshape U.S. monetary policy; he led an effort to save the world economy.”  Not to be outdone in service to the Chairman, CNN furnished its own reporters, who gave credit to Bernanke for these measures.  Interestingly, however, even though one reporter admitted that Bernanke had said in 2007 that the subprime market and its derivatives would not threaten the financial market and the banks, she attributed the fault there to the imperfections in the market rather than to Bernanke himself in being wrong.   So, he gets credit for having cleaned up the mess (ignoring the foreclosed homeowners) but not the blame for being wrong about the contagion (and not urging regulation of the derivatives).  

The full essay is at "How a Chairman of the Fed Used the Media."

Obama's Meeting with Culpable Top Bankers

When he was running for US President, Barak Obama said that the financial crisis provided an opportunity for financial system reform beyond that which is in the interest of the big banks because the power of the latter is temporarily eclipsed and the US Government can take advantage of that.  His assumption is that during normal times, the banking industry essentially owns the Congress (Sen Dick Durbin’s statement just after the banking lobby defeated a foreclosure bill in the US Senate in 2009).  Sadly, the government did not use the eclipse; rather, it has been using the appearance of power and direction in the relumed post-crisis period to engage in window-dressing to assuage populist anger at the banks.

The full essay is at "Obama under Culpable Bankers."

A Nobel Peace Prize Awarded in spite of a Troop Surge

In December of 2009, Barak Obama was the first sitting U.S. president in 90 years and the third ever to win the Nobel Peace Prize. Yet he did so under the long shadow of the war in Afghanistan, where he was ordering 30,000 more troops into battle.  Could Truman’s decision to drop the A-bomb on Japan be along the same logic because it was meant to preempt the loss of life that would have come had the US invaded Japan?  President Reagan’s peace through strength logic was that a military build-up would forestall or prevent war from breaking out (hence no loss of life would be involved even in the forestalling).   The logic of awarding a surge President with a peace prize seems more dubious.  

The full essay is at "A Nobel Peace Prize amid a Troop Surge."

Eleven Time Zones in Russia: A Problem of Consolidated Empire

As of 2011, Russia had 11 time zones, from the Polish border to near Alaska, a system so vast that a traveller could get a walloping case of jet lag from a domestic flight.  In 2009, Russia was considering shedding some of its time zones.  People running businesses in the far east were complaining because the regulators were typically in Moscow, which could be several hours behind.    The issue blossomed at the end of 2009 into an intense debate across the Russian Federation about how Russians saw themselves, about how the regions should relate to the center, and about how to address the age-old problem of creating a sense of unity in a diverse federation that had been consolidated politically.  In short, the issue concerned the challenges involved in a consolidated empire. 

The full essay is at "Russia as a Consolidated Empire."

The Federal Reserve Expanded Its Turf in Spite of Having Come Up Short

Testifying before the US Senate Finance Committee on his re-appointment, Ben Bernanke volunteered that the Fed had been “slow” in protecting consumers from high-risk mortgages during the housing bubble and that it should have forced banks to hold more capital for all the risks they were taking on.  “In the area where we had responsibility, the bank holding companies, we should have done more.” he told lawmakers.  The hearing provided new evidence of doubt among lawmakers about the Federal Reserve’s  role as the nation’s guardian of the financial system. “In the face of rising home prices and risky mortgage underwriting, the Fed failed to act,” said Senator Richard Shelby of Alabama, the senior Republican on the banking committee. “Many of the Fed’s responses, in my view, greatly amplified the problem of moral hazard stemming from ‘too big to fail’ treatment of large financial institutions and activities.”  Accordingly, Senator Dodd proposed that the Fed’s powers as a bank regulator ought to be transferred to a new consolidated agency. Even though Bernanke admitted that the Fed made mistakes as a regulator of the bank holding companies, he and other top Fed officials adamantly opposed Dodd's proposal, arguing that the Fed has unique expertise nonetheless and that the Fed's ability to preserve financial stability depends on having the detailed information that only a regulator has about the inner workings of major institutions.

The full essay is at "The Federal Reserve Bank."

Human Rights Violations in Syria and Bahrain: On the American Reaction

The New York Times reported on March 25, 2011 that Syrian military troops opened fire on protesters in the southern part of Syria. Tens of thousands of demonstrators in the southern city of Dara’a, a well as protesters in some other cities and towns around the state, were defying a ruler who once again demonstrated his willingness to use lethal force against his own citizens. The paper reported on March 27th that "(w)ith 61 people confirmed killed by security forces, the country’s status as an island of stability amid the Middle East storm seemed irretrievably lost." Weeks earlier, the Arab League had declared that Qaddafi had lost his sovereignty—meaning his right to rule without intervention from other countries—because he had been engaged in having Libyan civilians killed. Since the League’s declaration on the Libyan dictator, the “president” of Yemen had use force against protesters—even gaining power from the legislature to lock up his detractors. As if these cases would not be enough of a bad precedent, Bahrain’s ruler had also been using lethal force against protests—just days after sitting down with U.S. Secretary of Defense William Gates, who was urging restraint.
In the midst of the Syrian government's violence, MSNBC reported on March 25th that the United States called on the Syrian government to stop the violence against marchers, White House spokesman Jay Carney said. "We strongly condemn the Syrian government's attempts to repress and intimidate demonstrators,'' he told reporters. Meanwhile, according to The New York Times, the new American ambassador in Damascus, Robert Ford, was "quietly reaching out to . . . Assad to urge him to stop firing on his people." Quietly? Meanwhile, American fighters had been bombing what was left of Qaddafi's airforce in Libya. The inconsistency was not lost on some American officials, according to The New York Times. "Having intervened in Libya to prevent a wholesale slaughter in Benghazi, some analysts asked, how could the administration not do the same in Syria? Though no one is yet talking about a no-fly zone over Syria, Obama administration officials acknowledge the parallels to [Qadaffi]. Some analysts predicted the administration will be cautious in pressing Mr. Assad, not because of any allegiance to him but out of a fear of what could follow him — a Sunni-led government potentially more radical and Islamist than his Alawite minority government." So strategic interests, even if running at cross-purposes with itself, are thought by some as a legitimate basis for a rather blatant inconsistency from the standpoint of human rights and the long term goal of democracy in the Middle East.
I contend that the continued support of rulers in Syria, Bahrain and Yemen while turning on Qaddafi, as if diplomacy were sufficient in dealing with the former three but not with the latter, is not at all in the interest of the United States beyond short-term political expediency in the theatre of international relations. Moreover, the double-standard concerning the rulers who have turned on their own people undercuts the credibility of the American government. 

On the Police Power of Chinese Banks

In July, 2010, a few days after the Agricultural Bank in China went public in an IPO bringing in $22 billion, dozens of former bank employees stealthily gathered outside the headquarters of the country’s central bank. Like many other state-owned companies, the bank slashed its payroll and restructured in order to raise profitability and make the bank more financially attractive to outside investors. By Western standards, the bank was overstaffed, a legacy of its role as one of the pillars of China’s socialist financial system. The fired bankers had no legal redress. 

The full essay is at "On the Police Power of Chinese Banks."

Source: http://www.nytimes.com/2010/08/16/world/asia/16china.html?pagewanted=1&_r=1&dbk

Thursday, March 29, 2018

Is Greed Implicit in Christian Theology?

In Business Ethics for Dummies (p. 123), greed is defined as a basic desire for more. The authors posit a “reasonable greed,” which in business “fuels growth,” which in turn “creates jobs and adds value to a society [and] economy” (p. 124). The authors conclude that “in terms of this social and economic growth at least, greed is a good thing” (p. 124). This sounds like a partial affirmation of Gordon Gekko’s claim that “greed, for lack of a better word, is good” (Wall Street). As long as greed proffers good consequences—the greatest good for the greatest number—the desire for more is ethical, or “reasonable.”

An Interfaith Declaration of Business (Ethics)

Released in 1994, “An Interfaith Declaration: A Code of Ethics on International Business for Christians, Muslims, and Jews” is comprised of two parts: principles and guidelines. The four principles (justice, mutual respect/love, stewardship and honesty) are described predominantly in religious terms, devoid of any connection to business. In contrast, the guidelines invoke the principles in their ethical sense, devoid of any religious connotation. The disconnect in applying religious ethics to business is not merely in books; the heavenly and earthly cities are as though separated by a great ocean of time.

 Are these religions applicable to business?    Wikipedia

The full essay is at "An Interfaith Declaration of Business."

Source:


Related paper: "Religion in Strategic Leadership: A Positivistic, Normative/Theological and Strategic Analysis," Journal of Business Ethics (2005) 57: 221-239.

Related book: God's Gold  The text goes through the history of Christian thought on how greed is related to wealth and profit-seeking, and proffers an explanation for why the historical shift was from anti-wealth to a pro-wealth dominant stance. 

Wednesday, March 28, 2018

Christian Films as Distinctly Theological: A Theological Project

To be profitable, is it advisable that films with a distinctively religious theme and narrative water down their theological dimension so to be more acceptable in modern, secular society (i.e., a broader range of movie-goers)? The success of films like The Last Temptation of Christ, The Nativity Story, The Passion of the Christ, and Son of God suggest that theology should be embraced rather than tempered if box-office numbers are at all important. The genre should thus be distinguished from historical drama. Screenwriters and directors engaging in the religious genre would be wise, therefore, to distinguish the theological from the historical even in handling religions in which the historical is salient in the theological.

The full essay is at "Christian Films as Theological."

Monday, March 26, 2018

When an Unethical Corporate Culture Becomes Dangerous in a Primitive U.S. State: Uber’s Self-Driving Cars in Arizona

A company with a horrendous reputation for having an unethical, and harsh, company culture is likely to be attracted to places in which lax regulatory oversight exists. A governmental view that regulations should be minimized dovetails with such a company. The two are a match, though not exactly made in heaven. The nexus can be situated closer to the ground, in a desert in North America, in Arizona in particular. In the case of Uber, which was testing its self-driving cars there in 2018, the flashpoint came in March, when such a car hit a pedestrian who was crossing a street without a sustained sidewalk. Suddenly society took another look, a much more hesitant look, at self-driving technology. Missed, however, was the nexus between Uber’s squalid culture/mentality and Arizona—the culpability of both having led to a perfect storm.

The full essay is at "Uber in Arizona: A Perfect Storm"


Differences between Two Living Popes White-Washed in Fake News

People in glass houses should not throw stones. Or, the person who is without sin casts the first stone. Lastly, a house divided cannot stand, at least in the long run. Yet houses are so rarely as fundamentally divided as the one in which I grew up. Regarding religious institutions, theological differences can be allowed to blow up into major, life-threatening disputes, or papered over by sins of omission pertaining to just how deep a fissure goes. Conflicts, in other words, can be exacerbated or mollified, depending on the temperaments.
On February 7, 2018, Joe Ratzinger, a former pope of the Roman Catholic Church, wrote a letter pertaining to a multi-volume book on the then-current pope’s theology. Reading from the letter at the book’s presentation the next month, Dario Vigano, the prefect of the Vatican’s communications office, said that Benedict, the  former pope, confirmed that Francis, the current pope, had a solid theological and philosophical training and that the book showed the “interior continuity” between the two papacies.[1] This “left the impression that the 91-year-old retired pope had read the [book] and l endorsed it, when in fact he hadn’t.” The retired pope had not read the book!

The full essay is at "Two Living Popes White-Washed."



1. Nicole Winfield, “Vatican Bows to Pressure, Releases Retired Pope’s Letter,” Religion News Service, March 18, 2018.

Friday, March 23, 2018

Corporate Social Responsibility Is Not Altruistic: The Case of Amazon Prime

In a doctoral seminar on corporate social responsibility (CSR), the professor turned to me, perhaps because by then I was also taking courses in the religious studies department, and asked, “What is enlightened self-interest?” In my answer, I argued that such self-interest is distinctly oriented to the long-term, rather than, for example, immediate profits. Alternatively, I could have stressed the ethical connotation of the word, enlightened, but the self-interest component would seem to invalidate an ethical basis. In line with the notion of love as caritas, which is human love (eros) sublimated up directed to God, as distinct from agape, which excludes lower, self-interest inclusive, love, doing good can go along with long-term self-interest. In other words, doing good has value because good is done even if self-interest is salient in the motive. In regard to CSR, the self-interest that coincides is long-term-oriented. Amazon, for instance, giving the poor (i.e., Medicaid recipients) 50 percent off on the monthly charge for Amazon Prime is in line with gaining full-paying customers eventually, for it usually takes a while for poor people to move up the economic ladder.

The full essay is at "CSR at Amazon."