The Bitter Pill

It is almost universally assumed that it was a piece of legislation that catered only to America’s left wing. People still believe that corporate America uniformly opposed the bill. But in the end, some of the most effective, cost-controlling aspects of the pre-passage aspects of this controversial seminal statute were purged in favor of powerful corporate interests with well-funded lobbyists and campaign contribution machines. The legislation, of course, was The Affordable Care Act of 2010 (which conservatives always call “Obamacare”).

Healthcare insurance companies defeated an attempt to expand Medicare to provide a governmental alternative to individual-policy-choices, mandating that only private, for-profit companies, were to provide the funded portion of required coverage. The Medicaid elements were left to individual states to expand, and most conservative states opted out of this aspect of the bill. And so, when you choose between silver, gold and platinum policies, implementation will always be through a private company. Insurance companies picked up millions of new policy-holders.

The other corporate interests who shaped the bill to their profit goals were the huge pharmaceutical companies. They lent their support to the Act in exchange for a continuation of their crushing any hope of containing the cost of prescription drugs. Not only are Americans prevented from buying drugs in very trustworthy countries (like Canada, Germany, UK, France, Switzerland, etc. where many of these drugs are actually made!!!) under the guise of “we can’t be sure of quality in foreign venues” logic, but the healthcare exchanges cannot even use the volume of the covered clients to negotiate with these pharmas to reduce costs. As a result, the United States has the highest cost of prescription drugs in the developed world. By far!!!

So it has become a new trend among private equity firms/hedge funds, to buy niched pharmaceutical manufacturers with specialized products, jack up the cost of their core products astronomically, and then tell the world how much additional research is going to be funded as a result. Meanwhile, a cheap corporate acquisition becomes an instantaneous major profit center for the new investors.

The screaming canary in the price gouging mine was unleashed in September 20, New York Times article: “Specialists in infectious disease are protesting a gigantic overnight increase in the price of a 62-year-old drug that is the standard of care for treating a life-threatening parasitic infection… The drug, called Daraprim, was acquired in August by Turing Pharmaceuticals, a start-up run by a former hedge fund manager. Turing immediately raised the price to $750 a tablet from $13.50, bringing the annual cost of treatment for some patients to hundreds of thousands of dollars.”

Presidential candidate, Democrat Hillary Clinton immediately tweeted: “Price gouging like this in the specialty drug market is outrageous.” Followed up with: “[Clinton’s specific] proposal aims to cap monthly and annual out-of-pocket costs for prescription drugs to help patients with chronic or serious health conditions. It would also deny tax breaks for televised direct-to-consumer advertising and require drug companies that receive taxpayers' support to invest in research and development.

“‘We will start by capping how much you have to pay out of pocket for prescription drugs each month. And we're going to hold drug companies accountable as we work to drive down prices,’ Clinton said [September 21^st] at a campaign event in Louisiana…

“Her plan also seeks to increase competition for traditional generic versions of specialty drugs to drive down prices and offer more choices to consumers… Clinton aides said a central component of the proposal would require health insurance plans to place a monthly limit of $250 on covered out-of-pocket prescription drug costs for individuals. The campaign estimated up to 1 million Americans could benefit from the proposal annually.” AOL.com, September 22^nd.

Fellow Democrat candidate, Senator Bernie Sanders, quickly noted that he has been pressing the Congress to investigate such price gouging practices and why The Affordable Care denies massive healthcare exchanges from using their power to negotiate prices down. See below.

The argument from the pharmas is always the same: medical research is very expensive, and charging what you can is simply a way of funding that research. Right. Stretch that logic to the credibility breaking point. Many pharmas, but not all, have programs for those who cannot afford the new prices. Nice guys. As government research budgets and support of university research continue to contract or simply die, the shift to privately-funded research has been significant. But there is a very big moral question as to why customers of these medications have to subsidize people with differing ailments. Why is it that foreign buyers of the same drugs get the benefits their government negotiators can secure, when there are no such negotiators permitted in the United States? Is our funding structure for such medicines completely unsustainable?

If the manufacturers of Daraprim found that $13.50 or less a pill was sufficient for decades, what is the remotest justification for a 574% increase? Just because a group of investors want more money?! Clearly, that is the only real reason for the shameful price increase. But it happens all the time. “Turing’s price increase is not an isolated example. While most of the attention on pharmaceutical prices has been on new drugs for diseases like cancer, hepatitis C and high cholesterol, there is also growing concern about huge price increases on older drugs, some of them generic, that have long been mainstays of treatment…

“Cycloserine, a drug used to treat dangerous multidrug-resistant tuberculosis, was just increased in price to $10,800 for 30 pills from $500 after its acquisition by Rodelis Therapeutics. Scott Spencer, general manager of Rodelis, said the company needed to invest to make sure the supply of the drug remained reliable. He said the company provided the drug free to certain needy patients.

“In August, two members of Congress investigating generic drug price increases wrote to Valeant Pharmaceuticals after that company acquired two heart drugs, Isuprel and Nitropress, from Marathon Pharmaceuticals and promptly raised their prices by 525 percent and 212 percent respectively. Marathon had acquired the drugs from another company in 2013 and had quintupled their prices, according to the lawmakers, Senator Bernie Sanders, the Vermont independent who is seeking the Democratic nomination for president, and Representative Elijah E. Cummings, Democrat of Maryland… Doxycycline, an antibiotic, went from $20 a bottle in October 2013 to $1,849 by April 2014, according to the two lawmakers.

“The Infectious Diseases Society of America and the HIV Medicine Association sent a joint letter to Turing earlier this month calling the price increase for Daraprim ‘unjustifiable for the medically vulnerable patient population’ and ‘unsustainable for the health care system.’ An organization representing the directors of state AIDS programs has also been looking into the price increase, according to doctors and patient advocates.” NY Times.

Public shaming helps. “Cycloserine was acquired [in August] by Rodelis Therapeutics, which promptly raised the price to $10,800 for 30 capsules, from $500. But the company agreed to return the drug to its former owner, a nonprofit organization affiliated with Purdue University, the organization said on [September 21^st].” NY Times, September 21^st. The price dropped back to normal. Turing was unmoved, however. Daraprim remained absurdly expensive.

Do we live in a cruel society where the profit motive trumps medical suffering, allows financial mega-players to take what they want with little or no concern for the impact on society and allows corporations to decimate the environment and not pay a dime to the society for the damage they have inflicted? Can we, as human beings, continue to turn a blind eye to the ruthless pursuit of profits with little or no care for the impact of such efforts? Are we okay with providing tax benefits and regulatory loopholes to corporate America that they actually use to harm the rest of us?

I’m Peter Dekom, and as times change and benefits reallocate, there has to be time for a ground-up review of our priorities and what really should be permissible and encouraged without making decisions based on “slogans and labels.”

We’ll Be Watching You

Many of us have noticed that somehow, after we send a text or email about a particular subject, we somehow begin to be bombarded by emails, ads inserted in strategic places on your home page or in little carve-outs on those Web-searched pages you’ve pursued, and maybe even a text from an advertiser you’ve never seen before… based on that keyword you used in your digital communication. Obviously, they are tracking you! Data scrapers. Metrics analysts. Automated tracking software. They may claim it is “anonymous,” but we don’t necessarily trust the source. Might be the government. Maybe even our government. Maybe not. Pledges that our personal data is “secure” is laughable mythology, as the federal Office of Personnel Management and the cuddly members of hook-up site, Ashley Madison, have discovered. And there is more than just a little overlap between AM and OPM players!

But we are in a pre-election feeding frenzy, as a litany of candidates with more money than they have ever had (thank you Citizens United) are using every marketing and advertising technique at their disposal. And those with savvy handlers are tracking potential sympathetic followers with unprecedented zeal. You might as well have one of those handlers standing over your shoulder taking notes. We also are aware of dark money contributors to SuperPacs with gobs and gobs of influence-buying cash. We don’t know who they are, and you’d think the Supreme Court were getting a cut of the new cash-for-voter-influence system they have created.

With all this new cash in the political mix, all the new mass media technologies available, you’d also think that our legal system has kept up with these changes. Not only is that completely false, but even where government regulators could penetrate the walls built by political miscreants, Congress has made sure that these agencies are so severely underfunded that they don’t have the capacity to do their jobs anyway. This is the underfund-to-disempower pattern we have seen with regulators at the federal Securities and Exchange Commission (watchdogs over the financial world) and the Environmental Protection Agency. Political campaigners – contributors and those who control what is done with those campaign dollars – can hide in the shadows. And they are watching your every move.

“Yet while political advertisers will know a lot about you, you may know very little about them. Due to paralyzed federal watchdogs and antiquated campaign finance rules that didn't anticipate the explosion of digital politicking, there is virtually no oversight of online ads. When it comes to old-fashioned print and TV political ads, the rules are simple: The candidate or organization paying for them must be disclosed. With online ads, there's a major loophole: A disclaimer is required only if someone pays to place an ad on a website. No disclosure is required for material that is posted on a campaign site nor for videos or images that can be distributed freely via social media. In other words, an attack ad can find its way onto YouTube or get retweeted or liked a million times without anyone knowing who made it. And so-called issue ads—spots that praise or slam a candidate without explicitly telling you how to vote—are not required to carry a disclaimer of any kind, no matter where they run online. That means a dark-money group can plaster the web with content, true or false, that is devastating to a particular candidate without having to claim responsibility for it.

“The Federal Election Commission's last major overhaul of political advertising rules was in 2002. And that rewrite was completed long before anyone pondered the possibility of things like YouTube, much less Snapchat (which several candidates, including Paul and Jeb Bush, have incorporated into their campaigns). Currently, the commission does not have the ability to scrutinize how a campaign or any other group spends its money online. ‘It's not clear to me that the FEC has much of a watchdog role in terms of digital spending,’ says Bob Biersack, a senior fellow at the Center for Responsive Politics who worked at the commission for 30 years… ‘Without some kind of statutory reason to care, the FEC isn't going to force candidates to be too specific about their strategic behavior.’” MotherJones.com, August 21^st.

The battles on Capitol Hill as well as within the agencies themselves are heavily divided along party lines. Republicans, whose access to all forms of transparent and dark SuperPac easily dwarfs Democratic counterparts, oppose anything that would rein in the spending or force dark contributors to identify themselves. Democrats believe that if the voters actually knew who was controlling the political spending, they would get “wise” and limits would follow. “Grassroots” has rather dramatic different definition, depending on which side of the aisle you sit.

“Early this year, Republican FEC Commissioner Lee Goodman penned a Wall Street Journal op-ed accusing his liberal colleagues of seeking to clamp down on harmless grassroots political expression. ‘Free and low-cost Internet postings are not corrupting because no large expenditures of money are necessary,’ he argued. He also claimed there is no way to distinguish online political discourse from paid messaging. ‘The specter of government agents reviewing the thousands of daily online political posts is as impractical as it is ominous,’ he wrote.

“Democratic FEC Commissioner Ellen Weintraub says her Republican colleagues are blocking regulations for digital political ads because they oppose the commission expanding campaign finance rules under any circumstances. ‘One of the reasons why people like Lee Goodman are so adamant about internet freedom is because basically the wave of the future is going to be a lot more online campaign advertising,’ she says. ‘And it will effectively be going underground in terms of getting any kind of regulation.’” MotherJones.com.

If the measure of a corrupt system is allowing anonymous and elite contributors (even when identified) of unlimited sums of money to influence policy and “motivate politicians to play ball,” then the United States clearly falls on the wrong side of the line. According to the latest Corruption Perception Index (2014) from Transparency International, the United States is tied with three other countries at number 17 in transparency… and falling. We should be at the top of the list, but we’re not. And if we do not take steps to make the system work for “most of us” and not the power elite with the cash to buy elected office, the cherished democracy we call the United States of America will fade away.

I’m Peter Dekom, and letting “bad happen,” taking political malfeasance for granted, is not self-correcting; fix it or lose it!

Seeds of Revolution

There are approximately 300 million guns under private ownership in the United States, with too many Americans believing that they have an absolute legal right to use them against any government they believe oppresses them. The NRA tells them so. Lots of military assault weapons with big magazines in the mix, under a sadly misinterpreted view of the Second Amendment (ignoring the “well regulated militia” words). “Stand your ground,” “your home is your castle,” and “open carry” have become rights in many rural value states.

We have the most polarized economic split in the developed world with a system of government that clearly favors those who have wealth and make their money from investment and trading. From Citizens United to loopholes and tax rates that only matter to those with wealth, we’ve become a nation that caters to the rich to the exclusion of most everyone else. Our standard of living is declining along with the buying power of our falling discretionary income. The numbers of those in the middle class are contracting too as upward social mobility has all but vaporized.

Political lines are increasingly being drawn on the “higher power” notion of religious beliefs. We are also moving from a nation of white Americans with traditional values rooted in our rural heritage to a country of racial and ethnic minorities that are much more based on urban values. 80% of our country is settled in and around the big cities, and under 2% of our nation work on farms. We’ve enfranchised women to have the vote, and we weathered that change quite well. But our current state of government accords much more voting power to rural communities than urban communities, with one rural voter often having the power of several city voters. That level of disenfranchisement endures.

Whether it’s the effect of the New Jersey Compromise (Ben Franklin’s structure that has two Senators from each state regardless of population), gerrymandering or restrictive voter ID laws, rural voters have been able to control the majority of state legislatures, governorships and both Houses of Congress despite the fact that an electoral determination based on sheer popular representation would work a deeply different result.

Deep in the inner city, gangs have long since left the world of accepting the incumbent authorities as having any power over them. They have their own rules, govern their own communities with clear gun-driven brutality, and have pretty much withdrawn from being a functioning part of our country. Right wing militias have formed, numbering in the hundreds. “While groups such as the Posse Comitatus existed as early as the 1980s, the movement gained momentum after controversial standoffs with government agents in the early 1990s. By the mid-1990s, groups were active in all 50 US states with membership estimated at between 20,000 and 60,000.” Wikipedia. A surge in such organizations occurred following the election of Barack Obama.

But the anger against Washington incumbents is growing, from the right and the left. We now have the largest group of people who think that the United States needs a ground-up rebuild at any time since the Civil War. The rural vs. urban values conflict in the Civil War was never completely resolved, as Confederate flags and names on government and NGO buildings can attest. But the underlying anger has now risen to the level where the potential of anger morphing into armed conflict has reached heights not seen since The War between the States.

“A brand new Washington Post-ABC News poll finds that 72 percent of Americans believe that politicians cannot be trusted and two-thirds think the country’s political system is dysfunctional. A not insignificant share of folks openly embrace radicalism: 21 percent of those polled would rather the next president ‘tear down’ the political system and ‘start over’ than try to ‘fix’ it. Six in 10 Republicans believe the next president should come from outside the existing political establishment.

“A CBS/YouGov survey of the early states, published [September 13^th], found another barometer of anger at Washington: 81 percent of conservatives in Iowa and 72 percent in South Carolina think congressional Republicans have compromised ‘too much’ with President Obama.

“With those numbers, it’s hardly astonishing that two guys who have never held elected office – heck, they haven’t even run for office before – get a combined 53 percent of the vote among registered Republicans and Republican-leaning independents in our poll. Donald Trump managed only to get stronger since the last time we were in the field. He’s the choice of 33 percent, up 9 points since mid-July. Ben Carson is second at 20 percent, 14 points higher than our July poll.” Daily 202, Washington Post, September 14^th.

“Tearing down” the system and “starting over” are different words for “revolution.” And with so many guns in the system, it is anything but certain that such massive change would occur in the United States peacefully. What the differing factions want after a “tear down” is very different depending on whether they are drawn to the left or right. With rural values voters having the bulk of the guns – the NRA is not a liberal organization – and with that faction slowly losing any hope of holding their existing power as demographic changes are set to overwhelm them, it is clearly not too early to wrap out heads around at rapidly-accelerating anger that is willing to risk it all… one way or another. If we do not learn to get along – and we seem to be moving in precisely the opposite direction – we do in fact run the risk of losing the United States of America.

I’m Peter Dekom, and unless we relearn the ability to compromise, we really risk losing it all.

Russia, the United States and the Middle East – the Subtext

The double-slam of the U.S. failure to protect minority Sunni rights against Shiite anger when it imposed a “democratically-elected” government on Iraq plus the devastating, never-ending regional drought very much linked to global climate change have decimated American political credibility, crushed its willingness to get involved in what most believe would be another losing ground war in the Middle East and tied its hands as a credible peace-maker anywhere in that area. Russia has stood by, smiling at our diplomatic gaffes and our slow, lingering defeats in every major conflict since the Korean War.

When they could, Russia mounted a conciliatory presence in the six-party negotiations that resulted in an accord that, if implemented, could de-escalate tensions generated from fears of regional nuclear holocaust. But even the wiliest of negotiators would never trust Iran to be on the up-and-up, and the most savvy analysts believe that slowing Iran down – particularly given the growing anti-religious-extreme beliefs of the vast majority of Iranians – might just give it time to mellow and join the world as a more moderate nation-state with too much to lose to start another war.

The Soviet Union fell hard after its devastating defeat at the hands of the Mujahedeen in its own Afghan War (1979-89). Russia (the Soviet replacement state) has been licking its wounds ever since, yearning for the days when its influence in the Middle East kept the United States at bay. But as the United States seems to have lost its stomach for Middle Eastern conflict – relegating its military support to training, equipment and itself deploying only antiseptic drone and attacks from the air – Russia has been slowly reinforcing its presence in the area.

The United States, torn between a strong desire to contain the genuine terror-threat of ISIS and its rather dramatic unwillingness to engage at any level that really would make a difference, is secretly looking at how the Russians, malevolent antagonists to American policies almost everywhere, might still be useful in supplying the force needed to turn the tide against ISIS. We don’t talk about this for obvious reasons, but trust me, allowing Russians to mobilize within this conflict zone might actually have a modicum of tacit U.S. support. Huh? Aren’t we really engaged against Russia in a surrogate shooting war (see my September 8^th blog)? Complexity compounds in this enigmatic region.

First, you have to understand the differences between the Russian perspective and the approach adopted by the United States and her allies. Having faced the Mujahedeen in Afghanistan, the same radicals who later “blew back” on the West (remember 9/11) after victory, Russia remains deeply mistrustful of supporting any rebellious group against incumbents. Russians point to the failures where the Arab Spring displaced brutal but stabilizing dictators with unstable religious zealots. They see the radicals aligned against the Bashir Assad regime in Syria as actual or nascent supporters of ISIS. With Iran’s military power and oil reserves, with a highly-educated population, southern neighbor, Iran, is also a prized Russian relationship. No matter how repressive the incumbent regime might be, Russians (with Chinese acquiescence) are uniformly supportive of regional incumbents. Human rights succumb to pragmatism every time. Today, to Russia, “rebels” equal “terrorists.” Always.

On the other side of this great philosophical divide is the new-found American opposition to anti-democratic, repressive regimes. The United States, while yet to take up direct arms against either Damascus or Tehran, has prioritized supporting groups who want majority rule. We are voicing strong negative opinions as Russia ships state-of-the-art arms, from jets to tanks (like the T-90 shown above) to missiles, to Assad and his cronies… all under the guise of reinforcing an incumbent against ISIS, but also supplying Assad with the arms to repress his own native rebellion.

“Pentagon officials said that the Russian weapons and equipment that had arrived suggested that the Kremlin’s plan is to turn the airfield south of Latakia in western Syria into a major hub that could be used to bring in military supplies for the government of President Bashar al-Assad. It might also serve as a staging area for airstrikes in support of Syrian government forces.” New York Times, September 14^th. But Assad cannot exist if ISIS keeps growing, so this double-edged sword may be soon swinging violently in both directions, against rebels and against ISIS.

American policy-makers see Russia on the wrong side of history – again (their Afghan war was also waged in support of a brutal incumbency) – and feel that Russia would far more effective in a focused containment effort aimed only against ISIS. The Obama administration is fully committed to toppling Assad and other similar repressive regimes until the mantra of protecting “human rights” and nascent democratic movements.

To understand how Russia and the United States differ in their approach, I will turn to the writings of Huffington Post (September 12^th) columnist, Raghida Dergham, also a Columnist and Senior Diplomatic Correspondent for the London-based Al Hayat, the leading independent Arabic daily, since 1989. She writes a regular weekly strategic column on International Political Affairs and is also a Political Analyst for NBC, MSNBC and the Arab satellite LBC. She is a Contributing Editor for L. A. Times Syndicate Global Viewpoint and has contributed to: The New York Times, The Washington Post, The International Herald Tribune and Newsweek Magazine.

“There is a view that holds that US diplomacy is indifferent to any Russian gains in the Middle East, which the United States has arguably decided to forsake, with the exception of what its alliance with Israel requires. This view holds that the United States has decided to do so following the discovery of large reserves of oil in its territories, and its decision to pivot east towards China and its neighbors.

“The other view believes the United States has provisionally stepped back from its leadership position to relieve itself of blame and responsibility, and at the same time implicate Russia in crises, bloody conflicts, and the quagmires of civil, religious, and sectarian wars.

“Regardless of which view is correct, Russia seems determined to fight several battles across the Middle East. Some of the battles intend to restore Russia's prestige and vindicate Moscow against having been excluded and insulted -- as Moscow believes -- in the wake of the Arab Spring, others to implement its vision for the Middle East and its influence and interests there.

“In a concept note entitled ‘Maintenance of International Peace and Security: Settlement of Conflicts in the Middle East and North Africa and Countering the Terrorist Threat in the Region,’ Russia has told UN Secretary General Ban Ki-moon it intends to convene a session for the Security Council at the level of ministers on September 30. According to the Russian document, submitted by Ambassador Vitaly Churkin, the aim of the ministerial session to be chaired by Russian Foreign Minister Sergei Lavrov is to adopt a presidential Security Council statement that stresses the urgent need to take action to resolve and prevent conflicts in the Middle East and North Africa, and identify possible additional steps to address terrorist threats in the region.

“The Russian approach is essentially based on linking conflicts in the Middle East to terrorism…The issues mentioned by the Russian document begin with the Palestinian-Israeli conflict. The Russian document points out that failure to reach a solution to the conflict boosts radicalization in the Arab street, and creates favorable conditions for the spread of terrorist ideas.”

ISIS is infinitely more dangerous that we have come to believe. And as my August 27^th blog documents (My Lie Can Beat Up Your Lie), our analysts have overstated our victories and unstated our stinging defeats at the hands of these murderous extremists. ISIS will spread terror wherever it can, including attacks within Western nations, even the United States. As migrant pour into Europe, a very small number are probably ISIS operatives. While we cannot turn our backs on the misery that has driven the migrations, the dangers are equally obvious. One can only hope that the migrants, who fear ISIS as much as anyone, will turn in those they believe are ISIS-sympathizers.

We need Russia as much as we should fear Russian intentions.  But if Americans are unwilling to take up direct arms on the ground, and as it is painfully obvious, Iraq is a joke without massive Iranian involvement (as Turkey uses the ISIS struggle to kill off Kurds), Russia may be the decider. Think this really isn’t happening? Think again. “The White House said on [September 14^th] that the United States wants to see Russia take on ‘more constructive engagement’ with the international coalition fighting Islamic State militants in Syria, rather than build up its military presence there.

“White House spokesman Josh Earnest said he did not have an update on whether or when President Barack Obama would call Russian President Vladimir Putin about the issue… ‘When our team and most importantly when the president determines that it would advance our interests to have a conversation with President Putin, then he'll pick up the phone and try to set up that call,’ Earnest told reporters at a briefing.” Reuters, September 14^th. Want more? “U.S. President Barack Obama believes that holding military talks with Russia on Syria is an important next step and hopes they will take place very shortly, Secretary of State John Kerry said on [September 18^th].” Reuters, September 18^th. We’re not willing to join ground action, but we desperately need someone powerful to join the fight? But perhaps beggars can’t be choosers. I am sure there will be some pretty strong negative reactions from that long-bench of GOP presidential candidates.

But wait… there’s even more! “Defense chiefs from the United States and Russia held their first direct talks in more than a year [on Sept. 18^th], discussing the multiple conflicts in Syria and ways to battle the Islamic State as part of possible wider contacts aimed at easing tensions… The talks between Defense Secretary Ashton B. Carter and Russian Defense Minister Sergei Shoygu, announced by the Pentagon, follow weeks of growing concern in Washington over Moscow’s military role with Syria’s government, a key Kremlin ally.

“The two officials ‘agreed to further discuss mechanisms for deconfliction in Syria and the counter-ISIL campaign,’ Pentagon spokesman Peter Cook said, using an acronym for the Islamic State…It was the first time Carter spoke with Shoygu since Carter took office in February, and the first call between any U.S. defense secretary and the Russian minister since August 2014.” Washington Post, September 18^th. Somebody’s gotta do it.

We are mired in the aftermath of failed American military and diplomatic policy, reliant on the least trustworthy nations on earth and faced with a litany of Hobson’s choices. What would you tell our leaders to do?

I’m Peter Dekom, and with our will-to-fight and political credibility at an all-time low, despite the campaign rhetoric, we are going to have to make some nasty choices down the line, with bad long-term ramifications no matter what we do.

Too Late or Too Oily?

The Bureau of Labor Statistics tells us that there are about 200,000 jobs directly in the oil extraction and processing industry (600,000 total people working in the entire oil and gas sector)… rather there were, when oil was $100/barrel. But with oil down to about $40/barrel, layoffs are growing, not just directly in the extraction part of the business but in related entities that deal with petroleum products at every level. In April, CNN reported a loss of 51,000 of those American jobs. Many more are expected as the oil glut seems to have no real end in sight (unless there is a war in the Middle East!).

But what’s been bad for the petroleum industry has made life more comfortable for average Americans. It’s even accelerated the return of less-fuel-efficient trucks and SUVs to cherished positions in the auto sales business and made the cost of commuting that much more tolerable, as prices at the pump have tumbled by as much as a dollar a gallon or more. Life is just a little more affordable.

However, cheap oil and gas have also fueled (wince) a decline in the relative value and emphasis of green energy alternatives at point where our global climate change problems are becoming exceptionally serious, perhaps even past the tipping point of no return. Fires are burning across the West, droughts are killing agriculture, summer heat is killing people all over the Northern Hemisphere (the Southern Hemisphere will pick up in a few months), and tropical depressions are roiling towards major hurricane status with increasing frequency. “Records go back to 1880, but nine of the 10 hottest months on record have happened since 2005… The first seven months of 2015 are the hottest January-to-July span on record.” AOL.com, August 20^th.

The interaction of so many variables tells you how complicated and interdependent our business environment is within this nexus of oil. We are deeply invested in the gasoline business, from extraction, refining, wholesale to retail. There’s even a debate, between industry sources (National Petroleum News) – which puts the number of U.S. gas stations at well over 150,000 – and the Census, which sees the number more like 118,000. Both sources will tell you, however, that the number of such stations is declining. There are hundreds of billions of dollars of infrastructure in those stations, lots of jobs (most at a low level, I might add) attached, and changing our energy sources is going to require a whole pile of new cash to configure what we’ve got if alternative fuel sources are remotely going to replace traditional fossil fuels in automotive transportation.

How does the petroleum industry feel about itself, the market, and the expected economic future of the petroleum industry? Not particularly good, if recent events are any indication. Let’s start with objective criteria: how much are new prospective oil lease opportunities doing in the open market? Not well, it seems: “With oil prices collapsing and companies in retrenchment, a federal auction in the Gulf of Mexico on [August 19^th] attracted the lowest interest from producers since 1986.

“It was the clearest sign yet that the fortunes of oil companies are skidding so fast that they now need to cut back on plans for production well into the future… The auction, for drilling leases, attracted a scant $22.7 million in sales from five companies, but energy analysts said that came as no surprise on a day when the American oil benchmark price plummeted by more than 4 percent. For the first time since the recession, it is approaching the symbolic $40-a-barrel level. Last summer, it was above $100 a barrel… Until now, most companies have insisted that they would not sacrifice production in future years when they said oil prices were sure to rebound strongly. But in recent weeks, executives have expressed concern that the oil price collapse could last through 2016 and even 2017, and it is important that they tighten their belts even more.

“‘The financial squeeze is tighter than people thought, so tight that the companies can’t even bargain-hunt for leases for future production,’ said Michael C. Lynch, president of Strategic Energy and Economic Research, a consultancy. ‘It’s the long-term production profile that is suffering now, and they will pay for it later.’” New York Times, August 19^th.

Want to make money in the oil business today? Put it in oil storage facilities, where all that surplus output from Saudi to American oil has to be contained! “Domestic storage alone rose 2.6 million barrels in mid-August, the report noted, because of an unexpected surge in imports and a drop in refinery processing after a breakdown in the BP refinery in Whiting, Ind.

“Current crude stockpiles of 456 million barrels in the United States are at levels rarely if ever seen at this time of year since World War II. Once the summer driving season ends and other regional refineries begin their seasonal retooling, the domestic glut of crude is likely to grow even larger and the price of oil and gasoline will fall further, analysts said.” NY Times. In the longer term, particularly if the current failures to expand production continue, we can of course expect oil prices to rise again. Obviously.

So are we smiling or crying? Guess it depends on whether you are a winner or loser in the supply and demand war raging around us. But this ambiguity has also taken too many eyes off the much longer term and the corollary damage to our environment generated by not prioritizing non-fossil fuel energy alternatives. Any transition from massive dependence on any one form of energy to an entirely different set of energy-generation sources is going to be painful, with many winners and many losers along the way. Perhaps this economic chaos will allow that transitional pain to ease into the system, but the changes are both necessary and inevitable.

I’m Peter Dekom, and America really can no longer afford to kick the barrel… er… the can down the road without very serious self-inflicted negative consequences.

The American Dream is Dead!

The United States has one of the least upwardly socially mobile populations in the developed world; mobility has been steadily declining since the 1920s. As a first class university education is virtually free in Germany, it is rising to ‘unaffordable’ for most Americans even within the public university spectrum. While an American born in the bottom rung of the U.S. economic ladder has an 8% chance of rising upwards, Denmark reflects double that number (and a much smaller percentage of people in poverty).

We have, by far, the highest per capita healthcare costs on earth. Likewise, we have a contracting middle class and the greatest polarization between the rich and everybody else in the Western and developed world. The statistical mean and the average Americans born into contemporary society would have much better chances for upward mobility virtually anywhere else in the developed, democratic world… in fact probably in any developed nation, democratic or not.

To social demographers and many historians, this macro-economic trend is simply a reflection of the unraveling of yet another social structure. There are no 10,000-year Reich’s, and even the most stable countries unravel sooner or later. In fact, the United States is one of the oldest continuous democratic forms of government on earth. The ample precedents from historical clocks, without a big reset, tell us that our time is running out. We are in fact moving toward a self-created demise, aided by so many others hell-bent on toppling the king of the hill. We are among the most disliked countries in the world. When privilege prospers – the legacy of too many years at the top of the ladder – and the masses face declining standards, political systems just fall, sometimes violently. Our legacy aristocracy is based on pure wealth.

Today, rich U.S. incumbents are too entrenched at the expense of others, the economic polarization has stymied internal economic growth (according to the IMF), the need to place the controlling elites with loose regulations and low taxes has resulted in austerity in the great equalizing forces of high quality (economically efficient) infrastructure, job-creating scientific research and exceptionally high level education. Our military excess has lined the pockets of too many in the related industry sectors. As American primary and secondary schools plunge in global comparisons, as highways and bridges crumble under the press of time and population growth, as university costs soar and as we slash and burn government-supported scientific research, it’s clear that America has transformed from a land of opportunity to a land of opportunists. The rich avoid taxes and outsource manufacturing with off-shore constructs plus local special interest legislation purchased with their now-legal influence-buying dollars.

In the coming election, we call the issue “income inequality.” Conservatives want lower and more easily calculated taxes… but if you run the numbers, those at the top of the economic ladder still do so much, much better than the rest of us. They rail at our regulatory schema, claiming it hurts job creation. The conservative mantra is to support the “job creators” (yup, the folks who make those outsource decisions), a rephrasing of the trickle down/supply-side economic theory that continues to fail every major statistical test neutrally applied.

Take away regulatory burdens, and the financial shenanigans of top Wall Street dogs that decimated the global markets in the Great Recession will come barking back. We’ve never fully recovered from that last debacle; the pain continues to sear: “Large banks are preparing to pay $1.865 billion to settle accusations that they conspired unfairly to control a derivatives market that stood at the center of the financial crisis, a lawyer suing the banks said in [a NYC Federal District] court on [September 11^th].” DealB%k, New York Times, September 11^th. The damage is still incalculable.

 Take away the environmental regulations; the big resource extractors will make even more money, and our air will look like Beijing. Canada has a much more regulated financial structure, and, by the way, Canada has never faced a huge depression or recession in its modern history. I don’t think their citizens are suffering under an impoverished social structure.

According to the Department of Labor, “The [Fair Labor Standards] Act requires employers of covered employees who are not otherwise exempt to pay these employees a minimum wage of not less than $7.25 per hour effective July 24, 2009. Youths under 20 years of age may be paid a minimum wage of not less than $4.25 an hour during the first 90 consecutive calendar days of employment with an employer.” Local communities in liberal cities – from Seattle to New York to Los Angeles – are rapidly moving towards a $15/hour minimum wage. Australia’s been at almost $16/hour for a while ($18 in major cities). Rates in Europe are often higher than here in the US, with healthcare and greater fringes thrown in as a bonus.

Liberals want higher taxes for the rich, more government subsidized education (including pre-school) and much lower charges for higher education and a whole different compensation/ healthcare package (free) for all of us. But words like “socialism” can tank a viable platform even though free public schools, Medicare and Social Security are about as socialist as you can get. And pure capitalism does not exist anywhere on earth.

We talk about a “free market” here in the United States, but with disguised farm subsidies (they call it “crop insurance”), tax breaks and loopholes, regulations exempting entire industries – from the hidden chemicals in fracking to the exemptions granted to the “too big to fail” financial sector – we are anything but a free market. If you’re at the top of the food chain, you get a whole lot more freedom than do the rest of us.

“Most of the public tends to underestimate the extreme wealth inequality there is in the country. They still care about addressing it, however. A Pew Research Center poll in January 2014 found that 69% of Americans (and almost half of Republicans) believed the government should act ‘to reduce the gap between the rich and everyone else.’ A May 2015 Gallup data showed that a full 46% of Americans are ‘strong redistributionists’—they believe the distribution of wealth and income isn’t fair and that heavy taxes on the rich are the solution. Among liberals, moderates, and even conservatives, a full 85%, 67%, and 42% respectively believed wealth should be evenly distributed.” FastCompany.com, September 12^th.

Let look at the coming election. Security from threats like ISIS and income inequality are the only real issues that will really impact daily American lives. “Immigration reform” is the big distractor, the big red herring, the big “scapegoat” finder in the coming election. But it doesn’t create new jobs, doesn’t really improve crime statistics (immigrants have lower-than-average crime numbers), doesn’t open new opportunity doors and doesn’t make us safer. We do not have massive migration issues such as the one facing Europe. All of our border nations are friendly trading partners. Gay marriage and religious “rights” again have little impact on how you live your own life (unless you are a professional meddler in the lives of others). They may help define the rural vs urban values split that defines our contemporary political spectrum, but they are not the big bad issue dogs on the block. Time to get real and understand what is really at risk.

I’m Peter Dekom, and if you care about the survival of the United States as an on-going political unit, focus on the real issues in the coming election; it may be the most important election in recent American history.

Earth’s Growing Migration Headache

The current massive migrations from North Africa and ISIS-invested lands in the Middle East toward Europe are the result of ultra-violence and political desperation. Things have gotten so bad that people are willing to place the lives and the lives of their children at risk to climb on to severely over-crowded boats, travel in locked trucks, where death lurks at every moment. The images of ever-increasing hordes of such migrants confronting trains, hostile paramilitary forces, and theoretically open borders sealed with thick reams of barbed wire and deep feelings of hopelessness and alienation over deeply uncertain futures in lands deeply unwelcoming to these desperate masses are all over the airways and the Web.

Well, the world better get used to such massive movements of people, all leaving horrific conditions behind in a desperate attempt to stay alive. For too many, staying in their homeland is becoming a guarantee of either a high risk of violence, torture and death or a slow extinguishment of life by an agonizing starvation as crops die, water disappears and land turns into permanent desert. Children with bloated bellies, eyes closing in their final moments, flies buzzing around their barren blank eyes are the new face of global climate change.

The hordes of assembling migrants-in-the-making are massive. They see lands not plagued by war, fields green with crops, reservoirs rippling with water, and cities filled with potential jobs as the new Holy Grail. These people are forced to find hope in places far from where they were born and raised. Their movement has been and will be resisted, opposed by mostly-Western nations hell-bent on stemming what they see has a life altering invasion of people they cannot possibly support without major personal sacrifices. The migrants, on the other hand, have absolutely nothing to lose. With death as their realistic major alternative, their eyes are focused on survival.

The fossil-fuel burning industrial revolution, the construction of large power-plants, highways filled with vehicles, still unattainable luxuries to well over a billion people on earth, are the product of a Western-led march towards progress. The Western world profited greatly from the industrial revolution, which generated the greenhouse gasses that are decimating farmland and the subsistence farmers who try desperately to pull failing crops from arid dirt.

“As U.S. Secretary of State John Kerry warned at a recent State Department-led conference on climate change in the Arctic, the scenes of chaos and heartbreak in Europe will be repeated globally unless the world acts to mitigate climate change… ‘Wait until you see what happens when there's an absence of water, an absence of food, or one tribe fighting against another for mere survival,’ Kerry said.

“World leaders have long warned that natural disasters and degraded environments linked to climate change could -- indeed, have already started to -- drive people from their homes. UN High Commissioner for Refugees António Guterres declared in 2009 that climate change will create millions of refugees and internally displaced populations. ‘Not only states, but cultures and identities will be drowned,’ Guterres said.

“Displacement is already happening in some parts of the world. Almost 28 million people on average were displaced by environmental disasters every year between 2008 and 2013, according to the Internal Displacement Monitoring Center -- roughly three times as many as were forced from their homes by conflict and violence.

“It's difficult to predict exactly how many more may be displaced as climate change progresses. ‘When global warming takes hold there could be as many as 200 million people overtaken’ by the consequences, professor Norman Myers of Oxford University argued in a 2005 paper. For comparison’s sake, 350,000 migrants sought entry into the European Union in 2014, the International Organization for Migration estimated.” Huffington Post, September 5^th.

Too many of the refugees are people of color. Black or brown, Arabs and Africans, migrating Central Asians. The words are about “secure borders” and “immigration reform,” but the thought of impoverished darker-skinned masses, many practicing what piles of Westerners see as “culture-destroying” Islamic religious beliefs with conquest on their minds, is antithetical to everything these Westerners hold dear.

In our own lands, cries abound to seal our brown-skinned border, which harbors hordes of “malevolent” (according to the Donald) Mexicans and Central Americans, some running from the drug cartels well-armed with arms easily purchased in the United States at unregulated gun shows and smuggled south.

There is almost no attention paid to the white-skinned border to the north, and the fact that those south of the border are almost all devout Christians is almost never mentioned. There are some facts that we might not want to hear, like the crime rate for those undocumented entrants is lower than applicable to the general population or that the net movement into the United States has steadily declined over the years as the American economy has contracted.

As Americans, we are truly lucky: there are no nearby enemy states, and our two massive international boundaries are with pretty friendly trading partners. We do not have massive civil displacement in our neighborhood. We do not have religious wars in our hemisphere. We are facing “migration light” compared to the building turmoil and desertification festering in the Eastern Hemisphere, rage and hopelessness that cannot help but make life in Europe, Asia and Africa vastly more complicated.

The West, now joined by India and China, has been the primary cause of the greenhouse effect that has created most of this destructive climate change. And in the end, it will be the West (with its new Asian co-conspirators) that will pay the accruing debt from the benefits extracted for over a century and a half. And we will pay, one way or the other, whether we like it or not.

I’m Peter Dekom, and it is indeed time to pay the piper, with costs mounting to the extent we do not address the root-cause of most of global climate change.