Month: November 2023

Mark

Israel/Hamas Conflict

A week or two ago I traded emails with a friend regarding my views on the Israel/Hamas conflict. Thinking of how I described my feelings about the issue in that exchange made me decide to record my perspective here for future reference. Following is a less personalized and hopefully more thoughtful and less emotional version of what I shared with my friend.

First, up front let me declare that the barbaric attack by Hamas on  Israeli citizens cannot be justified on any rational military or geopolitical level. It was pure inhuman evil and is way beyond what any civilized people would do to others, even in war. Regardless, I am beginning to find Israel’s military response against mostly innocent Palestinian people very troublesome as well. While I’m sure the IDF is not specifically trying to kill innocents in the most gruesome ways, as Hamas did, their military actions seem also to be demonstrating a lack of basic concern for human life.

Before I go further I want to clarify that I consider there is a fundamental difference between the Israeli people in general, and the current Israeli government in particular. I absolutely admire most of the Israeli people I have known. In my personal experience from many trips there, I found they are generally sincere, caring, and interested in the same things people everywhere want – to live, work, and raise their families in peace. They certainly share a common Israeli nationalist pride in their country, but I don’t think it is any different from what every nation’s citizens feel about their own country.

The current and some former Israeli governments are a different story all together. Netanyahu is exhibiting a dictatorial mindset and autocratic style similar to Viktor Orban or Donald Trump. And the members of the cabinet he has installed in his current government are, almost to a person, authoritarian extremists of the worst kind. They do not reflect the will of the Israeli people I know. I personally speculate that the reason Hamas chose to attack when it did was likely the result of their belief that domestic unrest over the PM’s anti-democratic actions had distracted the Israeli government enough that an attack could be successful.

  I fully support Israel’s right to respond to Hamas with all necessary force. But I reject the notion, as some are suggesting, that we have no right to criticize Israel for how it is conducting its military operations, given our fire and atomic bombing strategy in WWII. What we (the US and allies) did in that war must not be the standard by which we justify the behavior of Israel or any other country today. I know not every country or “tribe” behaves responsibly, but the world in general is more democratic and civilized now than it was then. And we have much more precise intelligent weapons systems and methods. Democratic governments today must be much more sensitive to collateral damage and military operations must be more surgical than was possible in previous conflicts.

I even think we make a mistake calling the Hamas/Israeli conflict a war. Hamas is a terrorist organization, not a legitimate combatant. And most of the Palestinian people in Gaza are victims just as Israeli citizens were on October 7th. Describing the conflict as a war gives Hamas a level of credibility that tends to justify Israel in using broad destructive operations with associated loss of innocent life. Of course Israel’s easiest military solution is simply to level everything in Gaza, which they seem to be executing. But doing that in the way Israel is playing it right now I think probably borders on war crimes.

Every conflict happens within a political, social, or historical context. While nothing justifies what Hamas did on Oct. 7th, the seeds for that atrocity have been sown repeatedly over the past 50 plus years. Israel has exercised a brutal occupation of Palestinian land, treated its people with contempt, granted virtually no independent rights, and have been unwilling to seriously consider any reasonable level of Palestinian self-governance. Sadly, the US has played the role of Israeli enabler throughout the whole mess.

When people have no hope, it is naive not to expect that some/most may resort to extreme measures in an attempt to gain relief. The Gaza Palestinians chose Hamas as a possible solution. In retrospect that was a mistake; Hamas has an entirely different agenda. It has not delivered anything but misery for the Palestinian people, and today does not even consider the needs of that electorate.

But what Palestinian could have known that at the time? It probably seemed a real political opportunity, or at least a less terrible alternative than then existed. All together understandable in my view. In fact right now with nothing remotely similar to what the Palestinians have faced for 50 years, many Americans are supporting the insanity of re-electing Donald Trump, apparently just to disrupt the current national political paradigm.

It is well past time for the international community, including the United States, to hold the Israeli government accountable to demonstrate more commitment to the safety, security, and humanitarian needs of the Palestinian people than they have so far, both in Gaza and the West Bank. Worldwide popular opinion demands it. At the same time Israel’s heavy handed military approach is spawning anti-Semitic demonstrations and violence everywhere. Those events are focusing hate on innocent Israelis as well as the international Diaspora of people of Jewish faith and/or heritage.

How this will end I don’t know. But I do know it is not in Israel’s best interest to continue its current strategy, or to occupy Gaza, if it wants to survive as a democracy and live in peace with its neighbors. I also know they can’t eliminate Hamas until they eliminate the reason such terrorists organizations exist. And right now Israel’s actions are recruiting and training the next generation of Hamas terrorists. At some point the Israeli government must face that reality.

What is needed most in this conflict and for long term peace and security is for Israel to publicIy recognize the need for and to endorse a two state solution, along with a pledge to actively support its implementation as soon as practical. At the same time they need to stop broad destructive operations in Gaza and support humanitarian efforts.

If Israel were to make a legitimate public commitment to implementation of two states living side by side in peace, the geopolitical environment would likely dramatically change immediately. Support for Hamas from the power players in the Middle-East would likely dissipate substantially and quickly shift to lobbying for influence in shaping the character of that political arrangement.

Even if Israel were to agree in principle, creating a sustainable two state solution will not be a walk in the park. The international community, via the UN, must play the key role in facilitating, lending credibility, and insuring fairness in the negotiating process and the ultimate implementation of an agreement. Israeli/Palestinian negotiations must not including Hamas, Hezbollah, or other terrorist organizations, but have as its goal the creation of the State of Palestine as soon as practical and with as much independent sovereign authority as possible.

Israel will likely resist the most critical elements of a successful arrangement and will have to make major (probably currently unthinkable) concessions to create a sovereign Palestinian State. Perhaps the most useful role for the US in such negotiations might be in influencing the Israelis to accept a truly balanced agreement. Subsequently, whatever the arrangement, it will be the broader international community in its commitment to Palestinian economic development that will insure success or failure.

Mark

2022 Non-Defense Discretionary Spending

The Eleven Categories of 2022 Non-defense Discretionary Spending

Health ($141B) – includes Veterans Hospital and Medical Care, Centers for Disease Control and Prevention (CDC), the National Institutes of Health (NIH), and Public Health and Social Services

Education, Training, Employment, Social Services ($132B) – covers most of the Departments of Education and Labor –  includes special education, education for the disadvantaged, Pell Grants, worker training and employment services, and Head Start

Veterans Services ($113B) – includes general operating expenses for the Department of Veterans Affairs (VA), the National Cemetery Administration, and other Veterans’ support services

Transportation ($112B) – Includes ground, air, water and other transportation and operations infrastructure; construction and maintenance of streets, highways, bridges, railways, airports, air traffic control, ferries, and other related transportation costs

Income Security ($93B) – includes general retirement and disability insurance; federal employee retirement and disability (including military retirement); unemployment compensation; housing assistance; nutrition assistance; and other income security, including programs like foster care, Supplemental Security Income, and the Earned Income and Child Tax Credits

International Affairs ($71B) – includes worldwide US diplomatic operations; embassy security, construction, and maintenance; contributions to international organizations including the United Nations; educational and cultural exchange programs; non-military international media programs including Voice of America, Broadcasting to Cuba, Radio Free Europe/Radio Liberty, Radio Free Asia, and the Middle East Broadcasting Network; operations of the Export-Import Bank of the United States as well as assistance programs including U.S.Global Health Program, Migration and Refugee Assistance, Food for Peace Grants, International Disaster Assistance, Development Assistance, Multilateral Assistance, and International Security Assistance

Administration of Justice ($68B) – includes Federal Court System, Customs and Border Protection (CBP), Immigration and Customs Enforcement (ICE), Secret Service, Department of Justice (DOJ),Federal Bureau of Investigation (FBI), Drug Enforcement Administration (DEA), the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), U.S. Marshals (USMS), and Federal Prison System

Community and Regional Development ($46B) – includes Federal Emergency Management Agency (FEMA); Community Development Block Grant (CDBG) program; Bureau of Indian Affairs and Bureau of Indian Education; and Rural Utilities Service infrastructure and infrastructure improvements for rural communities, including water and waste treatment, electric power, and telecommunications services

Natural Resources and Environment ($44B) – includes funding for Environmental Protection Agency (EPA), Army Corps of Engineers, National Oceanic and Atmospheric Administration (NOAA), Forest Service, National Park Service (NPS), U.S. Fish and Wildlife Service, Bureau of Reclamation, Bureau of Land Management (BLM), U.S. Geological Survey (USGS), and Natural Resource Conservation Service (NRCS)

General Science, Space, and Technology ($37B) – covers National Aeronautics and Space Administration (NASA), National Science Foundation (NSF), Department Of Energy Science Programs

Other ($53B) – everything not in one of the 10 major categories

Mark

Federal Deficit Spending/National Debt

This week (November 17th), we are facing another potential shut down of the federal government, for lack of willingness in the House of Representatives to pass the necessary budget resolutions. There appears to be some last minute jockeying, but the underlying sticking point seems to be non-defense discretionary spending levels. Some Republican House members have been demanding a 30% cut in that spending category, ostensibly to eliminate waste and reduce the federal deficit.

A look at the 2022 Actual Federal Budget Results

Total 2022 Federal Revenues $4.9 Trillion

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Total Federal Expenditures $6.3 Trillion

Mandatory $4.1 Trillion

Discretionary $1.7 Trillion

Defense $.75 Trillion

Non-Defense $.91 Trillion

Interest on National  Debt $.50 Trillion

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2022 Federal Budget Deficit $1.4 Trillion

Note:  The final 2023 budget deficit has not yet been determined. The current official estimate is for a $1.5 trillion deficit. However, as of May when that estimate was made, spending was roughly the same this year as last. However, revenues were running well below forecast. If that trend continued through September, some say the 2023 deficit may be as large as $2 trillion.

What is Discretionary Spending, Anyway?

Republicans seem to be obsessed with massive waste in federal discretionary spending, but only in non-defense expenditures. Democrats on the other hand, push for cut backs in wasteful discretionary defense spending, but want more non-defense spending.

So what is discretionary spending? It includes all federal spending that must be authorized by Congress on an annual basis. That is as opposed to mandatory spending, which by law is funded for the indefinite future and available to anyone who qualifies in accordance with established program criteria – things like Social Security and Medicare fall into that category. Discretionary spending typically accounts for about 25% of the federal budget.

Most Americans probably have a general understanding of what defense spending buys. Likely few have a reasonably similar understanding of what is included in non-defense discretionary spending. So, a primer paragraph on that specific classification of spending seems in order:

There are eleven categories of funding called non-defense discretionary spending. They include Veterans benefits, Center for Disease Control (CDC) and National Institute of Health (NIH) operations, State Department operations, Justice Department operations, Federal Court System operations, and several other critical government functions. For a list, definition, and total expenditures in each of those eleven categories in 2022, review a companion post titled “ 2022 Non-Defense Discretionary Spending”.

Wasteful Federal Spending

So is there waste in federal non-defense discretionary spending programs? Absolutely, just as there is in every other federal spending program, whether discretionary or mandatory. Then is there reliable evidence that waste in non-defense discretionary spending is worse than discretionary defense spending, or any other federal spending program? NO; there is no such evidence.

The problem with non-defense discretionary spending and the reason it is such an easy target for reactionary politicians to claim vast waste seems to be that it buys “soft value” for American society – things like keeping democratic institutions functioning, supporting international relationships, maintaining domestic rule of law, and helping the more disadvantaged and economically or healthcare desperate members of our electorate. It’s hard to see, feel, or touch those programs the way one might a $90 million F-35 fighter plane.

Thruthfully, a reasonable case can be made that in discretionary spending, waste is substantially more prevalent in defense than in non-defense spending. In fact, the Defense Department seems to be the single biggest waster of funds in the entire federal government. It is the only federal agency that has never successfully passed a single annual financial audit in more than 30 years.

And it is not just sloppy accounting or potential mismanagement of funds that is questionable in the Defense establishment; it is also defense policy decisions themselves. The “defense/industrial complex” seems to be quite alive and well, and many argue that is the force promoting major wasteful programs. One example which is frequently cited:  The Air Force is budgeting for deployment of a new fleet of manned heavy bombers. With US intercontinental ballistic missiles able to strike any specific target in the world precisely in about 30 minutes, who can imagine the need for a hundred new more advanced MANNED heavy bombers beyond what we already have, and at a cost of $700 million a copy? That demonstrates the political and financial influence of the US defense industry.

Regardless of all the above, arguing about cutting discretionary federal spending to reduce the deficit is for the most part a waste in itself. We have only to honestly ask ourselves whether we actually could substantially reduce the budget deficit by simply reducing wasteful discretionary spending, regardless of whether defense or non-defense. The answer to that question in easy. Given that discretionary spending is only about a quarter of the federal budget – There is not any chance!!

Focusing on that question a bit more though, think about this: Suppose we had just decided to cut the non-defense discretionary spending category by 30% in 2022, as Republicans are now pushing for in this year’s budget. In that scenario the deficit would still have been more than a trillion dollars without taking into account other economic stresses that move would have created.

The truth is that a 30% reduction in non-defense discretionary spending would probably not have produced any real savings at all. The funds that would have been withheld are exactly the ones that would have been immediately spent by the recipients, helping to drive further economic activity. Cutting them would have had a likely catastrophic negative impact on the broader US economy; federal revenues would have dropped significantly, maybe forced a recession, and civil impact/unrest would have been devastating in unpredictable ways.

Eliminating waste in federal spending and reducing the annual federal deficit are certainly worthy endeavors. Ultimately working toward a future balanced budget ought to be one of our key national financial goals. But a strategy focusing that effort only on reduced discretionary spending is a fantasy. It would require eliminating all non-defense spending as well as more than half of the defense budget. No honest politician would ever propose that kind of solution, and even those who have all know it’s not a legitimate objective.

It’s time to face the reality that there simply isn’t enough waste in discretionary spending to even make a serious dent in our current annual deficit. But we do need to take the annual federal deficit and the growing national debt seriously. I can easily make a strong case for why our current economic trajectory of deficit spending is unsustainable and, if not addressed, will ultimately lead to the loss of our democracy. Therefore the question is:  what should we be doing?

It’s time for a bit of reality therapy!

Regardless of the current political chaos, if cooler more rational heads eventually do prevail, achieving a substantially reduced annual deficit and/or a balanced budget will require fundamental reform of the entire structure of how we raise federal revenue, what we spend it on, and what our national budget priorities are. That includes restructuring all spending and revenue programs, including so-called “third rail” political issues like Social Security and Medicare, as well as revenue increases through tax reform. Of course all discretionary and mandatory spending programs must be addressed as part of a holistic approach to budget management.

Because our federal revenue and spending needs are not static, let’s take a realistic look at future federal funding requirements and priorities. First, our population is aging, just as it is in every other developed country. That means that social spending needs (SS, Medicare/Medicaid, as well as discretionary social spending needs) will continue to grow year after year. Second, economic inequality is beginning to be a destabilizing influence in our democratic system of government; that also is growing at an alarming rate. And though unpopular among conservative politicians, we need to address that in the near term to protect our democratic political viability. Third, if we want to continue to compete and maintain some advantage in the global economy and leadership in global geopolitical affairs, the federal government must invest substantially more in fundamental research and development as well as domestic scientific, technical, and physical infrastructure than we do today. These all require a more robust federal revenue stream in addition to more efficient and responsible spending.

What To Do?

It is critical that the US both trim federal spending and at the same time raise revenues. The time to start is now. My goal here in this section is to identify potential opportunities to reduce spending as well as secure new revenue streams. Everything I list here is conceptual in nature, but is the kind of changes we must make if we want to move toward a balanced budget. At the same time few of these conceptual changes could occur immediately. A comprehensive revision of the federal budget would need to be designed and implemented gradually over a fairly long period of time, say 10 years, to allow the economy to adapt to a new paradigm and avoid economic catastrophe.

Some, most, or all the ideas I offer below may be required to reach a healthy sustainable national economic and geopolitical framework for the United States in the twenty-first century. I also recognize that often what appears to be spending cuts to some will look like tax increases to others. Following are possible changes to federal spending and tax policies that I propose must be explored for the long term health of our democracy:

  • Completely rewrite the US tax code to be much simpler and to eliminate or dramatically reduce potential “loopholes” for imaginative tax avoidance squelch opportunities for evasion of tax liability.
  • Develop and implement means testing for SS payments to retirees.
  • Increase the age at which retirees can draw SS payments.
  • Charge SS tax on all employee payroll earnings. Currently a SS tax of 6.2% is levied only on the first $160,200 of payroll earnings.
  • Charge SS tax on all individual income regardless of its source.
  • Return to a substantially more progressive income tax policy. Starting in the mid-30s and ending in 1981 federal tax policy was used to mitigate economic inequality as well as raise federal revenue. That worked well at the time; we could return to that strategy to increase federal revenue as well as collectively benefit the broader electorate.
  • Tax all income at the same progressive rates regardless of its source.
  • Tax the income of closely held corporations (those not publicly traded) as personal income to the individual stockholders.

Other Governance Challenges

This discussion has been limited to the annual federal deficit and exploding national debt crisis. Separately however, the US has other structural flaws to deal with at the same time if it hopes to remain a leader in the free world. And of course addressing them will also require federal funding.

Liberal democracy is a work in process in every country practicing or aspiring to such principles. As societies advance socially, what might have been considered too liberal a few decades ago are not even adequate standards for today’s national social character. That has never been clearer than it is today if one compares the US social systems with those in other developed countries.

Among those structural challenges the US national government faces are:

  • How to implement an economical universal healthcare system that meets the needs of the entire electorate. The current free market system serves the wealthy element of our society very well; but it leaves most Americans inadequately covered, overpaying for the service, and unsatisfied with the results. On top of that US life expectancy remains below and infant mortality above the levels measured in other developed countries.
  • How to provide and fund public tuition-free education/training beyond high school. This particular issue will become more critical as advancing technology requires a better trained and skilled work force. A high school education is no longer enough to meet the needs of business and industry in this century. The Nordic Countries have generally done a good job of meeting those needs. They could be good starting roll models for addressing this deficiency.
  • How to develop and implement a rational immigration system. We need a system that attracts and makes it easy for the brightest and best educated to immigrate to and make the US their permanent home. We also need a workable program for temporary agriculture and other seasonal workers to be employed in the US. And finally we need a fair system for allocating a manageable annual number of immigrant visas from across the world.
  • We must more forcefully address systemic racism and sexism in economic, social, educational, business, and industrial equality of opportunity.

These elements of liberal democracy are not getting enough serious attention from politicians today. Left inadequately addressed they will continue to drag down the American collective quality of life, economic competitiveness and growth in the global economy, and our geopolitical status in the world order. I may have more to say on some of these subjects later.