Wisconsin’s Bigger Picture

Discussion of the Week
The battle in Wisconsin pitting Republican lawmakers and Governor Scott Walker against Democrats over the future of organized labor is about — well, that depends on who you ask. Republicans say it’s about fiscal reality and the need to tighten belts in this lengthy recession. Democrats say it’s about political giveaways today and campaign financing tomorrow.

The GOP says America is broke, must reduce spending, and is targeting social programs and organized labor. Democrats counter that if the nation is broke, it’s because banks blew up the economy and were then bailed out by taxpayers in the blink of an eye. The rich were taken care of — no questions asked — but nobody is willing to help the non-rich. In Wisconsin specifically, they point out, Governor Walker and the Republican legislature gave away tax breaks to corporate cronies that cost the state more than enough to cover the budget shortfall that they now want to bridge by busting public employee unions.

Conservatives respond that people should stop the dramatic sob stories and focus on the majority of cases that weren’t made for heart-wrenching television. Government labor is rife with waste: “Have you ever noticed that it’s always cops, firemen and teachers who get mentioned for cuts? Maybe in the winter, the guys who drive snow plows get mentioned. No one ever says we will have to lay off affirmative action officers, tax assessors, and school district bureaucrats if you don’t pass this tax increase.”

Perhaps what’s at stake is actually much bigger and more central to where American society is heading than either side is willing to publicly admit. Demographics are changing in America. Wealthy voters, those who tend to back the GOP, face a rising minority percentage of the population that overwhelmingly supports social programs that require redistributing wealth from successful people to less successful. If such a group takes political power in America, that group will destroy the capitalist spirit that made the nation great, indeed that made so many people want to immigrate to America both legally and illegally.

How to defeat larger numbers? By defunding the group. Public employee unions are one of the largest backers of the Democratic party, and they collect dues automatically from government paychecks creating what the GOP calls an unfair advantage. If the GOP can succeed in busting the unions, it will eliminate the only top-ten political fundraising groups in America that back Democrats instead of Republicans.

Unions are known for their get-out-the-vote programs that energize minority voters with single issues, such as a higher minimum wage because it’s important to many minority workers, and then use the mobilized voting bloc to elect Democratic leaders. Unions bring both money and votes to Democrats. That’s why Republicans want to cripple them and, while they’re at it, get more voter ID laws passed to prevent what they call rampant voter fraud. Democrats note the focus on IDing mostly minority voters in Democratic districts.

GOP supporters call the plan to bust unions and restrict the political influence of minorities brilliant, a smart use of the budget crisis to achieve a political aim necessary to preserve America’s tradition of self reliance. Protesters in Wisconsin and other progressives call the plan an evil ploy to strengthen the plutocracy that has already helped America’s rich get much, much richer.

The issue extends beyond Wisconsin to the entire nation. According to yesterday’s Washington Post: “More than half the children in California are Latinos, according to new census statistics that show the nation’s most populous state rapidly approaching the day when Hispanics overtake whites as the largest minority.”

The following excerpts from John Derbyshire’s We Are Doomed underscore the demographic tensions ahead:

The recent history of modern public-education reform in this country is very nearly a history of the determination on the part of white and East Asian parents that their children not attend schools with too many black and Hispanic students. …

What is the fundamental reason for all this segregation? Why don’t [whites and East Asian parents] want their kids going to school with [black and Hispanic] kids? As briefly as the question can be answered: because [black and Hispanic] kids are, in the broad generality, unacademic and unruly. …

The [white/East Asian versus black/Hispanic] wealth gap in the United States is quite breathtaking. The Pew Hispanic Center trawled through census data in 2004 to get the following figures for median household net worth as of 2002: Hispanic $7,932; non-Hispanic black $5,988; non-Hispanic white $88,651. Now that’s a gap. (Pew does not break out a figure for Asians. For purposes of highlighting minority distress, the Asian minority, which does rather well, is inconvenient. …

The highly default-prone subprime mortgages were disproportionately issued to non-Asian minorities. In 2006, according to the Joint Center for Political and Economic Studies, “twenty-six percent of mortgages for home purchases by whites were subprime … for Hispanics, it was 47 percent and for African Americans, 53 percent.” We also know that the states with the biggest increase in home-foreclosure rates are California, Nevada, Florida, and Arizona. If you rank all 50 states by the percentage of the state population that declared itself Hispanic in the 2000 census, those four are ranked 2, 5, 7, and 4 respectively.

This may be a battle to save the soul of America, but who’s doing the saving? Are Republicans saving it by defending the spirit of self-reliant capitalism against a less ambitious but growing population of minorities demanding handouts? Or, are Democrats saving it by defending the unalienable human rights championed in the Declaration of Independence for a growing class of non-wealthy Americans crushed under the boot of America’s richest citizens?

Sound off, citizen! Click the comment link below to join the discussion.

This entry was posted in Discussion of the Week, US politics and tagged . Bookmark the permalink. Both comments and trackbacks are currently closed.

27 Comments

  1. Rick
    Posted March 10, 2011 at 12:27 am | Permalink

    Here’s a challenge for my TeaParty/Reprobate friends: Read the following, and then replace “successful” with (a) “exploitative”, and (b), “lucky (to be white males)”. (You might also try to replace “capitalist spirit” and “great” with “advantage naturally accruing to the politically empowered” and “increasingly controlled by concentrated wealth”, respectively.) Being successful in the US means being successful at exploiting other people?? That’s not what Rush/Glenn/Michelle B says!

    “Wealthy voters, those who tend to back the GOP, face a rising minority percentage of the population that overwhelmingly supports social programs that require redistributing wealth from successful people to less successful. If such a group takes political power in America, that group will destroy the capitalist spirit that made the nation great, indeed that made so many people want to immigrate to America both legally and illegally.

    Note to JK – Sorry to use your fishing hole with my own bait! 😉

    [Additional comments below… using different chum!]

  2. stupid,lazy hispanic
    Posted March 10, 2011 at 12:50 am | Permalink

    I read with interest your article with excerpts from Mr. Derbyshire’s simplistic explanation for our nations woes. So it was the hispanics who came up with sub-prime mortage scheme? I see. They also are to blame for sub-par school districts they all live in because the their low net worth won’t let them raise enough revenue to build the same qualtity schools that whites and east asians enjoy. They should be good americans, pick themselves up by their bootstraps and get those better jobs that they are locked out of, not because of racism, but because they are lazy and stupid. We are doomed for sure.

    This is the same old story used against every wave of immigrants since the beginning of this country. Somehow we wouldn’t be in this mess if it weren’t for those dirty filthy immigrants. The italians, the Irish all went through the same scape goatism we are hearing now and guess what? The country didn’t go to hell in a handbag. Well, unless you’re a conservative and I guess, that’s exactly where we are going.

    Jason, you make the same mistake everyone else seems to be making when comparing Democrats vs Republicans. The comparison is a matter of degree. The Democrats are no angels but pale in comparison to what Republicans have planned and what they have already done to this country. Do we really want a total plutocracy? Do we really want the Koch brothers running our country and influencing our supreme court judges from behind the scenes? Already they have facilitated big money’s ability to buy elections and even allowing them to draft policies to be passed by their lackey’s in congress. What world are they expecting where businesses hold all the cards and labor has no voice? Do middle class Republicans really thing GM will take care of them? A world where Big Business will act as a benevolent dictator and take care of everyone, police itself and work toward anything but its own benefit? Who believes that?

    • geoffrey
      Posted March 10, 2011 at 2:42 am | Permalink

      Your argument has many flaws. Let’s discuss:

      “They also are to blame for sub-par school districts they all live in because the their low net worth won’t let them raise enough revenue to build the same qualtity schools that whites and east asians enjoy.”

      Yes. Los Angeles just built a school that cost over $500 million. That’s over a half a billion for one school, largely attended by illegal immigrants or their offspring. Schools are forced to provide bilingual education to this trash and have overwhelmingly gone in the hole to provide funding to teachers, materials, buildings, etc. Home values have plummeted, so school levies and bonds cannot currently fill this gap. Furthermore, it is well known that many low-income (highlight low-income) latino families cram in households like sardines–often 4 to 5 families per household, thus limiting property tax exposure that would, in part, fund education. Additionally, black and Latino families place far (FAR) less values on education than respective Asian, Jewish, or white families. Couple that with the fact that most illegal immigrants are bottom barrel, uneducated folks from Mexico, who often have less than a 6th-grade education. How else do you think this story is going to unfold? One more factoid on this issue… upwards of 50% of Latinos in American schools never graduate high school. That’s absurd!

      “So it was the hispanics who came up with sub-prime mortage scheme? I see.”

      No. I agree with you on this one. However, the trash who bought these homes certainly could have planned better. Did they honestly think they’d ever be able to repay a $500k+ mortgage on a $35k salary? Blame predatory lending in part, but at some point accountability at a personal level must be factored into the equation.

      “This is the same old story used against every wave of immigrants since the beginning of this country. Somehow we wouldn’t be in this mess if it weren’t for those dirty filthy immigrants. The italians, the Irish all went through the same scape goatism we are hearing now and guess what? The country didn’t go to hell in a handbag.”

      Wrong. The Italians, Irish, Jews, Germans, etc from yesteryear were all here legally. Legally! They also came with the shoes on their feet and the clothes on their back and demanded nothing! No food stamps, no jobs, no welfare, no bilingual education, and no special privileges–just an equal opportunity, which they were aptly given. More importantly, they also embraced the American culture. They embraced American opportunities. They learned English first and foremost. They valued education and the hard-working American spirit. Contrast that with the culture that you defend–La Raza-loving patriots who demand free resources, free citizenship, bilingual education, free healthcare, open borders, etc.

      Most Americans (white, black, yellow, pink, or otherwise) don’t judge Latinos for their heritage or skin color. I have several colleagues, childhood friends, and acquaintances who are Latino in skin color, but America-first in every other regard. The illegals crossing the border aren’t these types of Latinos. They are bottom feeders, cockroaches, the lowest of low. Their own government doesn’t want them because of the problems they cause, so they push them onto us. If they were Mexicans of higher education that contributed to America rather than drain her dry, you would certainly have a point. Did you know that the average illegal immigrants costs the US taxpayer over $25k/yr? I bet you did not.

      Until we close the borders and eliminate the bottom feeders we won’t solve this problem anytime soon. Bring in millions of Mexicans that don’t breed like cockroaches, who are educated, and improve the USA rather than defecate on her, and I think you’ll see current Americans of all colors embrace them with open arms.

      • Rick
        Posted March 10, 2011 at 3:03 am | Permalink

        Man, Geoff, thanks for sharing! I’ve not had the opportunity to see just what a racist sounds like up close! “They are bottom-feeders, cockroaches…”?

        Did Jose take your ball as a little boy? Did Hector pin you in wrestling? What exactly bit you in the arse and has left you seething at the Rodgriguez clan? (Notwithstanding your Glenn Beck protestations of “some of my best friends…” it’s obvious that you have a (tortilla) chip on your shoulder.)

        Life has a way of coming back to haunt you… should you and your 1% income bracket sharing wife be fortunate enough to have children (beware, though, it will be a real distraction from your love of money), may they fall in love with a border crosser, who – despite your attributions of a preference for “defecating on [Betsy Ross]” – knew enough to risk their lives and in many cases all their worldly possessions making what is an absolute leap of faith.

        Come to NYC. The future is not in the racist-built and maintained “gated communities”, but in urban centers that are inevitably going to continue to draw “the huddled masses” and even the “cockroaches”… and we seem to do just fine. (Not by your standards, probably, but that’s ok, I’m pretty confident I don’t share your standards, thankfully.)

        • geoffrey
          Posted March 10, 2011 at 3:21 am | Permalink

          Rick (Ricardo?), you clearly pick and choose. My argument is not racial–it’s purely class-based and maybe that’s what bothers you. Am I racist? No. Am I “classist”? Damn right. You can’t have a system of bottom-feeders (white, black, latino, asian, etc) and expect them prop the system up while they suck it dry at the same time. These are the cockroaches I refer to. I’ll never apologize for my income level. It’s people like me that allow people like you to drain the system.

          • Rick
            Posted March 10, 2011 at 3:41 am | Permalink

            Ah, Geoff, your presumptions race with your prejudices to occupy the coveted role of “my biggest handicap to removing the scales from my eyes.”

            You have no idea of my background, my education, my income or the amount of taxes I have and do pay.

            Am I surprised you would make such a presumptuous statement? No, I’ve read your posts.

            • geoffrey
              Posted March 10, 2011 at 3:47 am | Permalink

              “Am I surprised you would make such a presumptuous statement? No, I’ve read your posts.”

              Hello Mr. Kettle, this is the operator. You have a collect call from Mr. Pot. *wink*

          • Posted March 10, 2011 at 10:49 am | Permalink

            Geoff was careful to frame his response in terms of class, not race, and I find that typical of the smart people I know who worry about America’s demographic trends. Racists exist, but noting general demographic trends and discussing them does not necessarily make one a racist.

            I’m sure every one of us in this site’s community knows good and bad people of every stripe. I know I do. All of us would rather welcome Denzel Washington’s family over for dinner than Timothy McVeigh’s. I’ve worked with fine people who were black, Hispanic, Asian, and other subgroups as well, such as gay people. Some of the worst people I’ve ever met were white and Japanese.

            Yet, these anecdotal, individual experiences do not refute general trends that have been researched and tabulated. The lower income of blacks and Hispanics as compared to whites and East Asians is a fact. It’s hard to call it a plot against immigrants considering that East Asians are also immigrants, but do very well in America by starting successful businesses and emphasizing education in the raising of their children.

            My definition of racism is pre-judging an individual person based on their appearance before I’ve actually come to know them. Not only would that be unfair, it would remove many opportunities from my life that have come from my desire and ability to work with all sorts of people. I’m proud when I look over the rainbow of connections I’ve built across racial, religious, and even national divisions.

            Racism is not, however, noticing general trends across groups. There’s a problem in black and Hispanic cultures in that they too often label successful people in their own communities as having “sold out” to the white community, as if getting ahead in America is by definition a white thing to do. An element of black and Hispanic cultures encourages their members to learn less, strive less, and earn less because that’s what it means to be of that culture. Rap lyrics rarely speak about going to college; they often speak about murder, rape, time in jail, and other niceties of America’s underbelly.

            If anything, I discriminate based on decency, not even class. I enjoy time with any type of decent person, I disdain time with the non-decent — and, for the record, I’ve met a lot of the non-decent through my circle of wealthy investors. Believe me, the non-decent gene crosses all racial, cultural, and class lines.

            Ultimately, though, what are we discussing? Even if we agree that there are inherent flaws in black and Hispanic culture that keeps their members ranked below whites and East Asians in societal success, what can be done about it?

            My best idea is to begin with real educational reform, not the type that’s been foisted off on taxpayers and results in children spending as much time learning about minor figures in American history because of their non-white skin color as they do about key figures of America’s past, spending too little time on math and science, and so on. We need to get past the multi-cultural smokescreen that says anything a culture does is as valid as anything another culture does — even though they produce wildly different social results. We need to stop considering it white to do well in school and achieve success in America. That needs to be revered and encouraged in every community.

            I wish I knew how to pull it off. The results of educational reform have so far been abysmal, according to No Excuses: Closing the Racial Gap in Learning by Abigail and Stephan Thernstrom. Regarding that book, John Derbyshire in the above-mentioned We Are Doomed wrote:

            “The Thernstroms are briskly dismissive of the usual explanation for the gap: that it is a matter of class, not race. This is so much not the case that its not-being-the-case actually has a name: the Shaker Heights effect. This refers to an affluent Cleveland suburb where one-third of the families are black, and ‘the community is strongly committed to racial integration.’ Alas, in the 1999-2000 academic year, ‘more than half of all Shaker Heights whites passed [Ohio’s statewide proficiency tests in basic subjects] with honors. For blacks, the figure was an astonishingly low 4 percent.’

            “The Thernstroms’ book offers a four-page Conclusion, but nothing much is concluded: Their proposals are feeble: ‘Choice [of where to live] should not be a class-based privilege.’ (Where has it ever not been? How will you stop people from moving, if they can afford to?) ‘Families must help their children to the best of their ability.’ (Oh.) … ‘Big-city superintendents and principals operate in a bureaucratic and political straitjacket.’ (True, but Shaker Heights is not a big city.) ”

            I wish I knew how to snap my fingers and better align black and Hispanic cultures with the definition of success in America, but I don’t. Apparently, neither does the Republican party and it has concluded that rather than hope for a change of results from the fastest-growing demographic in the land, it’s better to do what it can to limit that demographic’s influence as America competes on a planet that is rapidly producing legions of young people proficient in math and science — and eager to eat America’s lunch in the marketplace.

            • Sunken Costs
              Posted March 11, 2011 at 1:03 am | Permalink

              Jason,

              I really enjoyed reading your post…I think you make some very good and valid points. I was with you right up to the last paragraph where you submit that the GOP has given up on integrating the minority demographic and has turned to limiting their influence. In my opinion, your assessment is wrong there. I’m assuming that based on the subject matter of this disucssion, you arrive at that conclusion based (not soley based, but as an example of) on the GOP trying to remove collective bargaining from the public sector unions in WI. It appears to me that the public union is the connection between the “GOP” and “black and hispanic cultures” in your submission (please correct me if I am wrong). The GOP is trying to diminish the power of the union (thus, the hispanic and black culture) through legislation (diminishing collective bargaining, etc). Why can’t the WI government’s reasoning be taken at face value? I don’t think it’s unreasonable to expect an employee to pay into their pension and healthcare funds, do you? Wouldn’t that save taxpayer money? Why should public employees need collective bargaining? There are many protections already in place for government workers through existing laws. If collective bargaining is left in place, any monetary concessions that the union agrees with now will simply be renegotiated at the soonest possible time (thus nullifying ANY attempt to save taxpayer money). I must admit that I am a bit naive on all the intricacies involved here, so if my reasoning is factually flawed, please help me understand. I like dialogue and don’t mind being corrected with solid reasoning, so please do so. I am new to your newsletter and wish to thank you for the services you provide. I am a fairly new investor and am excited with what you are offering. Thanks Jason.

              • Posted March 11, 2011 at 9:13 am | Permalink

                The argument you present is exactly what the GOP is saying. The rebuttal:

                There is no real budgetary crisis if we remove the crony kickbacks that enabled $112B federal taxpayer money to bail out AIG (and many billions more to help the banking industry) and Wisconsin taxpayer money to help GOP-connected corporations via tax breaks. Just the AIG bailout alone was enough to repair every state fiscal crisis in the land. AIG was saved, no fuss no muss, but non-rich workers were left in the cold. Thus, to those in support of the union side, the working class is being forced to subsidize the filthy rich — and losing their collective bargaining as a way to turn the tables later.

            • Sally
              Posted March 11, 2011 at 1:10 am | Permalink

              Jason, my idea for “real educational reform” starts in the classroom. I believe there should be ‘subject’ levels instead of ‘grade’ levels (1st grade, 2nd grade, 3rd grade…). ‘Subjects’ would include traditional things like English (Reading, Writing), Math, History, and Geography, as well as non-traditional things such as Society (socio-political topics) and Money Management. Each subject would be divided into graduated levels of breadth and depth, starting with the basics. Beginning students would start at Level 1, and would be required to stay in school until they had completed Level 12 in each required Subject. (Elective Subjects could certainly be offered as well, but would have fewer Levels.)

              At the end of a designated time period (maybe 15 weeks), students would be tested in each Subject. Students who scored high enough in a Subject would advance to that Subject’s Level 2; those who didn’t would remain in Level 1 until his/her score improved and the content of Level 1 was mastered. Fast forward a few years and a student might be in Math Level 4, English Level 2, History Level 3, and so forth. Fast forward a few more years and a student who had already completed Level 12 in one or two subjects might be taking ‘Post-12′ or even College courses in those subjects while still working in lower Levels in the other subjects. Another student might be taking vocational training courses or working at a job while finishing his/her remaining required Subjects.

              The crux of the Reform is that students proceed by Subject, not by Grade, and could therefore advance in each Subject at whatever speed their abilities allowed. The students in each Level would be working at an equal pace: none would be bored (content too easy) or struggling (content too hard). Since enrollment in each Level is determined by mastery rather than age, students are much more likely to succeed in school.

              An added benefit of “Subject-oriented’ education would be ‘Subject-specific’ teachers. Teachers would be hired according to their demonstrated (tested) expertise in a single Subject. Schools would get the best bang for their instructional bucks, and students would get really knowledgeable instructors in every classroom.

              • Posted March 11, 2011 at 9:23 am | Permalink

                I like your plan a lot, Sally! I can predict right now, however, the way its benefits would be watered down to the point that they became meaningless:

                After a couple of years, there would be noticeable patterns as to which students were rising quickly through the levels and which were languishing at lower levels. The patterns in plain sight would be deemed politically unacceptable, and the patterns would be blamed not on student aptitude but on the tests used to determine who advances and who does not. The tests would be rejiggered to create a more level pattern of advancement across all student types, and we’d be right back where we are now with bright students being held back by the slow pace or no pace of the less bright.

                If we could somehow keep that from happening by convincing society that everybody is happier when we funnel people into the professions that best suit them rather than assuming everybody should be bound for college and a boardroom somewhere, your plan would be great. Those with less interest or aptitude in academic subjects would be free to find their way into other lines of worthy work. They would not be under constant pressure to “get your grades up” when they are either uninterested in doing so or unable to do so. I’ve seen that kind of pressure make a kid’s life very difficult, indeed. The desire of everybody to make this one boy I know into something he simply is not: (A) did not work, and, (B) made him, his family, and his teachers miserable in the years of trying.

                So, I support your idea wholeheartedly, but think the allowing of testing to separate people by ability and motivation would prove to be unacceptable in modern America.

  3. JimJinNJ
    Posted March 10, 2011 at 12:51 am | Permalink

    It seems the question Jason poses is a bit late in the game–the game is over; that seems to be the conclusion of Derbyshire as well.
    We can recreationally debate who’s fault it is:
    1) greedy capitalist pigs.
    2) vote buying Democrats who pander to the poor (imported poor I believe);
    3) vote buying Republicans who provide imported the employers who cheat by using non-US labor at below market rates;
    4)etc.
    But we’re f’d either way.
    We’ve gone past the tipping point and turning back is impossible short of catastrophic civil war, rebellion and that may create a worse situation.
    Pat Buchanan documented this in Death of the West 15 years ago. And the issue in not what the country’s demographics will look like, that is virtually guaranteed by birth rates, immigration patterns, public policy. The issue is for each family to figure out how to survive, insulate themselves as best they can from an otherwise downward spirally situation.
    does anyone think our politicians will solve our fiscal mess–at any level of government?!
    you know the most likely scenario is for them to piddle around the edges, exchange debating points, pander to beat hell and eventually inflate the way out. pay the impossibly large debt with inflated dollars. that is the least painful political route, it entails plausible deniability for incumbents who can blame it on 1)the other party or 2) past incumbents of both parties.
    Hope for the best, whichever side of the blue-red divide you prefer, but plan for the worst.
    by the way–I have no guns, no gold, no bible, no church, no emergency rations, and have all my teethe. But I have gone beyond who is right and wrong, to blame and not. The trends are there and the America we have known in my life is soon to be a thing of the past.
    I’d love to have someone mount a strong argument why I am wrong in my forecast. Until then, hedge for the worst.

    • Rick
      Posted March 10, 2011 at 1:04 am | Permalink

      Cross the river, JimJin and come to NYC. You’ll find millions of us living cheek to jowl and the whites are ALREADY in the minority. No need for civil wars or catastrophes, nor guns, gold, bibles and emergency rations; the City has already been in the future, and it’s not as bad as you think. Families here don’t “figure out how to survive, and insulate…”, they get that we’re in this together and maybe the “other” is an illusion. It ain’t pretty, but its real and its working, and my bet is that it will continue to work. We’ll muddle on while the fearmongering falls on deaf hears. (Did you hear that Glenn Beck is off the air in NYC? No one was listening.)

  4. Rick
    Posted March 10, 2011 at 12:57 am | Permalink

    The downside of diversity, or why Europe has different languages (and the EU is and always will struggle): Derbyshire is right for the wrong (implied) reasons.

    When the dominant subculture (affluent white Northern European-derived races) DEFINES what is important in life (having more, consuming more, living larger), and then imposes that definition on an increasingly diverse population (that includes sub-populations that may hold different values and stem from different cultures (community, families, arts, alternative world views), there will be tensions. Particularly when the continuing success of the dominant subculture in power is contingent on the exploitation of sub-populations and continued control of political processes. And especially so, when the increasingly diverse population – and even members of the dominant subculture – are becoming more accepting of and tolerant of “the other”. (When “live and let live” is increasingly the motto, it’s harder to demonize those pesky subcultures (substitute: gays, women, hispanics, african americans, etc etc). )

    When the puppets stop fighting amongst themselves, they are more likely to look up and see whose pulling the strings.

    Also, one might conclude from the Derbyshire excerpt that the non-Asians were more likely to be fooled/duped into the subprime mortgages. Another way to look at it is the Asians were less likely to risk losing what they had acquired and less likely to try and exploit the system (the ninja loans were quite obviously a “wink and a nod” set up: go ahead and fudge your income, Ms. Hairstylist, cause (a) we can always refinance you later when prices rise, and (b) I already know you’re not making $300k per year, but you don’t see me pulling your application, now do you?”

    Morally bereft hairstylist, or, someone who sees that the system is bent, and would like a little of what mr white vp (already bent) from mortgage originations has got?

    • Posted March 10, 2011 at 1:39 pm | Permalink

      This poses the question, though: If the dominant subculture’s traditions are so anathema to immigrating subcultures, why the immigration? Next, if subcultures don’t value property and wealth as much as the dominant subculture, then why must we force the dominant subculture to share its wealth with subcultures that don’t value it as much?

  5. Posted March 10, 2011 at 1:22 am | Permalink

    A ‘fair & balanced’ approach to the topic, as usual, Jason.

    However, when you say “If such a group takes political power in America, that group will destroy the capitalist spirit that made the nation great…” you are wrong.

    True, a shift toward liberal political power will – as it always has – create a pendulum swing in that direction but will most certainly not go so far as to “destroy the capitalist spirit”. To say so is hyperbole and not supported historically. ‘Capitalist Spirit’ – aka the American Dream- is too much a part of our cultural landscape for that to happen.

    The American system always seems to balance itself out in the long run – and the time frame for doing so seems to get shorter with each passing decade.

    Admittedly, the pendulum swings appear to be getting a bit more extreme these days. They need to be moderated.

    Jon Stewart got it right with his “Million Moderate March”.

    • geoffrey
      Posted March 10, 2011 at 2:59 am | Permalink

      “The American system always seems to balance itself out in the long run – and the time frame for doing so seems to get shorter with each passing decade.”

      Maybe, maybe not. The socialism pendulum has been swinging more towards socialism for the last 75 years. We’ve been wait a long, long time for things to “balance”. Other than a few blips here and there, it’s only gotten exponentially worse (and will continue to worsen in the foreseeable future). Couple that with corporate greed and corporate crony-ism politics that have been rampant for the last 30 years and perhaps one may conclude that the pendulum is beyond reversal. Beyond a real revolution with real change (not replacing one corrupt individual or group with another), I question whether this system will ever be fixed.

      • Posted March 19, 2011 at 1:07 am | Permalink

        Geoffrey…when you say “the socialism pendulum has been swinging more towards socialism for the last 75 years.”…are you saying during the Eisenhower, Nixon, Reagan and Bush I & II eras the pendulum was swinging towards socialism? Or, are you just discounting those years?

    • james
      Posted March 10, 2011 at 5:24 am | Permalink

      Pretty optimistic, Lyn. Pure faith. We Americans have never seen this much Govt intrusion. The health care law is the icing on the cake( well, actually when the left gets control of the military we’re done). 40 % of households are on foodstamps. Govt workers earning $90k a year are playing victim and don’t want to pay for their own retirement or health insurance, and most of the media doesn’t address the fact that the private sector is paying for it. Corporations go over seas to avoid excessive taxes and the left complains they go there, claiming they should stay here and give all their profits to be “redistributed”. The party in charge disregards the law by ignoring a judge’s ruling that the oil drilling ban in the gulf is unconstitutional while the price of oil goes up.

      The groups that Derbyshire are refering to, will only increase the country’s dependence on Govt. because they have a strong lobby of college educated victims endorsing and encouraging them.

      I could go on, but my computer will probably cut off the internet…

      When has this country faced this much govt intrusion?

      • Posted March 19, 2011 at 1:27 am | Permalink

        James,
        ‘Government intrusion’ is a rhetorical smoke screen, as are arguments about Socialism vs Capitalism, Conservative vs Liberal, etc. What goes unacknowledged is that people love government intrusion when works in their favor – which is the majority of the population – most of whom complain about “government intrusion” while happily cashing their Social Security checks and enrolling in Medicare.

        ALL forms of government services, rules, regulations, law enforcement, benefits, etc. constitute “intrusion” to one degree or another – and we would be up a creek without it.

        What we need to do is back away from ideology and political posturing and tell the truth. The truth is we all want more efficient government. And it is not like sex. Size doesn’t matter. What matters is efficiency and effectiveness…getting maximum value per tax dollar spent…the most bang for the buck……..hmmm……bang for the buck?…maybe it’s about sex after all.

  6. Jeff
    Posted March 10, 2011 at 1:23 am | Permalink

    To JimJinNJ

    The doom sayers have a perfect record of being wrong. See excerpt below!

    I believe taking financial influence out of politics is the only answer if America ever wants to become a true democracy.

    Kelly Letter, 3/6/11
    The following are excerpts from Warren Buffett’s latest letter to shareholders, which appears in Berkshire Hathaway’s 2010 annual report (http://is.gd/wZaTdu):

    “We are envisioning a year free of a mega-catastrophe in insurance and possessing a general business climate somewhat better than that of 2010 but weaker than that of 2005 or 2006.”

    —–

    “Money will always flow toward opportunity, and there is an abundance of that in America. Commentators today often talk of ‘great uncertainty.’ But think back, for example, to December 6, 1941, October 18, 1987 and September 10, 2001. No matter how serene today may be, tomorrow is always uncertain.

    “Don’t let that reality spook you. Throughout my lifetime, politicians and pundits have constantly moaned about terrifying problems facing America. Yet our citizens now live an astonishing six times better than when I was born. The prophets of doom have overlooked the all-important factor that is certain: Human potential is far from exhausted, and the American system for unleashing that potential — a system that has worked wonders for over two centuries despite frequent interruptions for recessions and even a Civil War — remains alive and effective.

    “We are not natively smarter than we were when our country was founded nor do we work harder. But look around you and see a world beyond the dreams of any colonial citizen. Now, as in 1776, 1861, 1932 and 1941, America’s best days lie ahead.”

  7. Bill
    Posted March 10, 2011 at 1:58 am | Permalink

    Here’s a radical suggestion: why don’t both sides sacrifice? The Haves pay a little more in taxes, and the Have-nots give up some of their benefits. That fact that neither side will look to the common good of the country reveals their narrow self-interest. Would it kill that top 1% to do without a few more stock purchases or vacation homes? Can the working middle class pay for more of their health benefits? Can the poor stop and think about what they could do themselves to stop drug use, malnutrition and child neglect in their communities and reduce their dependence on social services?
    Rather than framing it in terms of blame and punishment for any one social class, why can’t it be a call to pull together as a nation? Can we drop the blind adherence to self-serving principles and deal with reality?
    Probably not, and we can all finger point later, as this divided country one day descends into violent class warfare and chaos.

    • geoffrey
      Posted March 10, 2011 at 2:12 am | Permalink

      You make the logical assumption that those evil rich folk don’t pay their fair share. My wife and I are in that 1% bucket, and by no means are we rich. We live comfortably, sure, and we have fewer financial problems than most, but we also pay an exorbitant amount in taxes and we have financial concerns and worries like anyone else.

      The real culprits and beneficiaries of this broken system are not the upper 1-2%. These folks may be your neighbors for all you know, and from personal experience they are not that different from the middle class. Who’s the beneficiary then? It’s the upper .1 and .2% — the richest of the rich. The Warren Buffets, Bill Gateses, Wall Street senior execs, etc. These are the people that can dictate policy at a federal level, the ones that influence and buy out politicians for personal gain. In the end it doesn’t matter how much you take from the upper .1% because they control the game and will find a way to take that much more. Be careful what you wish for.

      • Posted March 19, 2011 at 12:37 am | Permalink

        And…Geoffrey…both Gates and Buffett – along with a long list of other billionaires – are on record saying “raise my taxes…PLEASE!

    • james
      Posted March 10, 2011 at 5:26 am | Permalink

      The “haves” already pay 90% of the taxes.

  • The Kelly Letter
    A Complete Investment Management System
    The Kelly Letter  every Sunday morning by email.
    Like no other. Many subscribers say this is the best read of their week, astonishing in its ability to distill seven days of noise into one succinct overview of the very few items that might matter. Start your Sundays right!
    A one-page Quick Start Guide
    with page number references to full information in The 3% Signal. You'll receive access to this right away so you can begin transforming your portfolio into a performance machine immediately.
    The 3Sig Calculator.
    A thing of beauty! You'll use it to generate your own personal signals every quarter including exact share amounts to buy and sell based on your account balances. It emails you the results to make later quarters easy by keeping last quarter's numbers at your fingertips. Some subscribers say this tool alone justifies their subscription price.
    The subscriber-only section of this website
    where likeminded investors are commenting on notes and discussing in forums. Jason joins these interactions every day. They're a treasure trove of investing tips and wisdom.
    The archive of Kelly Letter notes.
    It’s a research center, searchable and smartly tagged to make gathering time-stamped material on covered subjects easy.
    The subscriber podcast.
    Jason reads every letter word-for-word. This feature was requested by subscribers who prefer audio learning. They listen on their Monday morning commute, during a workout, or while reading along at their computer.



    $200/year
    Save 17%



    $20/month
    Pay as you go
    Or sign up to receive free email and learn more about the system.
Bestselling Financial Author