The Bonfire of the Bonus Babies

 

The Fifth Horseman - TARP Fund Distribution

The Fifth Horseman - TARP Fund Distribution

 

On some level, I understand why the management at AIG took their bonuses. If it was part of their contract, why shouldn’t they? If their pay was part of the balance sheet that the rescue package was meant to help pay for the negative side of the sheet, why shouldn’t they collect? After all, the laws requires the company to pay its debts. Are we then to decide which of these debts take priority? Is it then not a fiction that we are rescuing these institutions when in fact we are just paying out to companies owed by AIG who in turn have their own contractual bonus obligations to meet. Why must the AIG boys hang and not the people about to collect on insurance floated by AIG.

It begs the question: is it wrong to be rich?

The Plaza Hotel

The Plaza Hotel

It’s a question that comes starkly to me as I wandered around ground zero of this pickle. I got to visit Southampton on Long Island and stayed in a luxury building on Central Park South. I ate Chinese a stone’s throw from Wall Street, and meandered past the half empty emporia of the vilified wealthy.

 

I noticed that among the well heeled, they never feel all that wealthy and they envy, resent, or at least are aware of someone wealthier than they. It is human nature to feel inadequate and to want. It is easy to live in the myopic view of the world in front of one’s face and not see the wider world around.

We notice only this world of the nearby and can be disassociated from images of suffering around the globe. Its that most people living near the median never actually see the lives of the people living one or two grades above them. The talk has always been about the invisible poor, the hungry and the homeless, but reveal the invisible rich, and it’s “to the barricades.” The French had these spasms of violence against the rich. Most recently in 1871, where mobs ransacked, butchered, and raped (in random order, usually all three) the wealthy and privileged of Paris. We are coming close to this when we vent rage at the managers of AIG.

 

View from Central Park South

View from Central Park South

The culture of the past twenty years has degenerated to a worship of things and their acquisition. By putting credit in front of people not used to wealth, the earnings of many years and even generations were made available to people who could not manage this kind of wealth. The packaging and selling of these loans and the skimming of fees as they were passed around, the leveraging of fractions of this debt, and the insuring of the particles thereof produced great wealth for a time, but it all came due. 

 

Everybody is at fault. This is a national vice issue where  there were pimps, whores, and johns, and no victims, but lots of perpetrators. If you’ve ever carried credit card debt beyond a month, you have been a party to this. If you bought lots of stuff borrowed from the value of your home, you have been a party to this. Right now, though, we’re concentrating on destroying the narrow class of Ivy-League educated ruling class living in smart enclaves in Connecticut and Manhattan, with their retreats in isolated burgs and islands.

Atlas -aka as President Obama

Atlas -aka as President Obama

I have to say, it is a terrible injustice to point the finger at a few and say, these people did it, and by burning them at the stake, we’ll be free. Everyone carries some of the blame. 

For the so-called middle class, this comes in the form of giant homes made of pressed wood fiber and synthetic petroleum byproduct, filled with unused exercise equipment, scattered and broken toys, and flat screen televisions. An anodyne futuristic lifestyle made available by the floating of a couple of years worth of disposable income.

The whole country’s occupation for the past generation had become the building of far-flung exurbs reachable by SUV, with no town center but a giant parking lot attached to a WalMart or a Costco. This was our wealth, to build these pressboard homes and borrow future earnings against their ever inflating values to accumulate jet skis and recreational vehicles, and Praise the Lord in colossal arena churches with concert level sound systems, sermons delivered in Powerpoint, and self-justification assured in the liturgy of accumulation and consumption.

The poor managers of AIG, the ones with death threats and private security guards, are merely the sacrificial scapegoats, the fools thrown out to the zombie mob in hopes that its attention will be distracted. What we aren’t seeing is a concerted message that the old ways are done. International commerce is done for a while, especially after we wash our hands of the accumulated debt by devaluation and nationalization.

What to do? Think about what it was that sustained life in the area around you. There is no reason why millions should live in the desert when the original population density was a few people per square mile. These areas should be abandoned. The general population should get used to working for and creating food. Our treasure and work should be spent creating sustainable economies, healthy strong communities, and planning for the future  rather than consuming and destroying and breeding with the hope of some end of the world bringing salvation. Or worse, go to Greenwich, Connecticut, to burn it down, and turn eastern Long Island into Rwanda.

The President gets it when he and his family started a garden. Say hello to your neighbor and wake up to the fact that he is really your fellow tribesman, and not the guy relocated there last year from Charlotte by his multinational now going belly up. The people around you and your relationship to them are the most important tools to survival. Humans were evolved to live in bands and tribes. The idea of holing up in some mountain redoubt with a lot of guns is a failure to recognize the lessons of zombie movies. 

We have to see these times as transformational, and that in fact we need a new contract that returns to the basic framework of the Constitution but acknowledges the challenges of the modern economy -too many people, not enough resources, inefficient ways of distributing them. 

For myself, the ethos of golf applied to life out of the bounds of the fairway, the application of the USGA rules of Golf to life, makes perfect sense. It is the need to create a new concept of the citizen and player in this country.

The Mast at the Empire State Building

The Mast at the Empire State Building

The Indebted

The great international shrinkage is upon us. The shriveling, the destaturing, the descending, call it what you will. I watched the President’s speech last night, and gave it a B+. I think that I’m getting kind of used to inspiring speech from him -it’s called refractoriness. My 100 meaningful conversation rule applies to him as well as any friend (over course of a relationship, one should and can only have 100 meaningful conversations before the relationship ends), and with his books and speeches, the President is on #58 or so.

I have a very good friend who decided to divest from Western Civilization in 2001 after 9/11. He had been reading books about peak oil, and had recommended to me Mr. Kunstler’s The Long Emergency. He bailed out of his 401k’s and mutual funds, and put them all into gold and oil, did very well by the way, and now is building a compound off the grid in some undisclosed location in the Pacific Northwest. 

The only problem I have with that scheme -of going it alone in the woods with a lot of guns, plans for a vegetable garden, and long hours fishing and hunting, is that it completely disregards the lessons of zombie movies. ‘Nuff said.

It takes a community to survive these times. It takes caring neighbors and taking care of neighbors. We’re social creatures whose evolution was based on bands, small groups. Your neighbors and your relationship with them is your assurance of safety in the difficult times ahead. 

By some accounts, the recession will be over by this fall. I’m keeping my fingers crossed. 

The Golfist President with a 20 handicap

obamaThe New York Times article states what I have suspected all along – President-elect Obama is a golfist (link). He scrupulously cards all of his strokes, plays by the rules, and adheres to golf ettiquette. There is hope for this country in a 20-handicapper president. 

The twenty handicap is an easy mark for labeling as a sandbagger. I bet the president-elect with his natural athleticism has a decent swing, although because he took up the game in his thirties, it may be a bit stiff. I’ll have to dig up a video somewhere. Just because you can reel off a 300 yard drive into a stiff wind and carry a 20 handicap does not make you a sandbagger but rather someone who is brutally honest, and likely a bad putter. When I hit my approaches to 5 feet, I generally can two putt for a par. 

I can’t tell you how happy this revelation has made me. Now I can sleep at night knowing someone who golfs like me will be in the White House.

 

Addendum: I did find video. He swings Lefty which bothers me a bit. Should have picked this up in the picture above which all show southpaw clubs. He does have the swing of someone who picked up golf as an adult. 

Miracles and Statistics

I had read that McCain’s aides, the ones trashing Sarah Palin this week, called Barack Obama, “the one.” This, I believe, is the reference from The Matrix series. It comes from the moment where Morpheus, the leader of the human resistance, reveals to Neo, “You are the one.” The Christ references came in spades as well as all kinds of Buddhist and Exodus references. The movie poses a serious question about miracles and statistics.

Science is never about absolute truths, but a series of questions and answers based on logic and statistics. If explanation A describes phenomena X 99% of the time compared to explanation B which works only 95%, theory A is the better explanation. Even so, there is no establishment of absolute truth, but support of a stronger theory. It is this process which refines the understanding of phenomena X -but this confounds people of faith.

People of faith believe in incontrovertible truths. They see the world in black and white and are highly suspicious of the shades of gray offered by theories. Science is a process that offers increasing degrees of certainty measured by statistics -some theories become established and become principles, but are always open to exceptions. These exceptions require new theories or amendments of theories, but on their face, they can seem miraculous because they occur in a vacuum of explanation. This happened when whole ecosystems were found around volcanic vents at the bottom of sea trenches. This will happen when we find extraterrestrial life. This will happen when a computer demands civil rights.

In the Matrix, the presence of Neo, and his antagonist, Agent Smith, are said to be the result of a statistical anomaly that occurs every few millennia. I have often thought that if something has a 1 in a billion chance to occur, it is likely to have occurred if there are billions of people. There is that great Youtube video of a baseball bat flung to the ground after a hit, ending up standing perfectly. Of the millions, perhaps billions of times, a bat has been flung to the ground, it usually should come to rest in a state of lowest potential energy. Because the bat has a flat surface on its end, there is a potential energy state that is metastable standing up. This seemingly miraculous event occurred and may likely occur again before the Cubs win the Series again.

So what are miracles? Are they statistical anomalies? Phenomena that occur in the vacuum of theory? People mystified by a standing bat? I believe in miracles as I have been the beneficiary of one requested on the tails of falling Perseid metorites in 2001. I cannot explain how it occurred or why. Miracles are the impossible made real. In a world where you can wish on a falling star and get your life’s wish a few months later, I cannot argue against the miraculous.