Denial, Fragility and a Schizophrenic Culture


I invite you to compare the picture of American prosperity as presented by the Federal government's (phony) statistics (incredibly low unemployment and inflation, rising wages and wealth, astonishing prosperity all around) and its chief shills, Ben Bernanke and Hank Paulson, and reality as captured by the following charts.

Consider this graph of homeowner equity. How can homeowner equity be plummeting in the greatest real estate boom in recorded history, when tens of millions of properties have doubled or tripled in value?

Please go to www.oftwominds.com/blog.html to view all the charts.

Gee, could it be that Americans have pulled money out of their houses even faster than they've risen in value? This is undeniably the case. As the following charts show, Americans have borrowed money /extracted equity at such a furious rate that it's not home equity which is rising but household debt.

And what have people done with this borrowed money? Have they squirreled it away for their retirement? If so, there is scant evidence of it; this chart suggests that they've spent the vast majority of it on consumer goods and services.

The proof of this free spending is everywhere: massively crowded airports because everyone is jetting everywhere, weak dollar be damned, fancy restaurants crammed to the gills, and of course huge shiny new SUVs and pickup trucks towing behemoth boats.

I look at these new vehicles--nary a one with a tool box or other evidence of a working truck--and wonder: who can afford this? Not just the monthly payment, but the insurance and gas. I know some people who make enough to own them, people making $100,000+ per year--but they're too exhausted to be driving around on Saturday towing their boat. Heck, they're at work or doing laundry or just sleeping, trying to rest up for Monday.

So who are these people flying to Europe, driving brand-new $30,000+ trucks and blowing $200 for dinner? Yes, they're middle-class Americans--the ones with negative savings, tapped-out equity and medicine cabinets full of medications.

As we ponder the meaning of that enormous spike in re-financings--sure, people re-financed to get lower interest rates, but how many took out some cash at the same time?--let's consider another trend which we can see with our own eyes: a culture of individual identity based solely on the external markers of fame, prestige and wealth.

If you've been on the planet a few decades, you know Americans have always been obsessed with celebrity and wealth. But never before were typical Americans so desperate for a fleeting moment in front of the camera themselves. There were no "reality" shows decades ago, no people groveling through disgusting indignities for their sweet glorious seconds of fame, or airing their dirtiest laundry in order to be lectured by some smarmy "celebrity" therapist or judge.

Hey, young ladies, take your shirt off! You'll be "famous" for a few seconds somewhere. Or leave your dorm room cam on while you undress. You might even get hundreds of subscribers if you convince your pals to join you prancing around in your panties.

Guys, you can't "earn your moment of celebrity" quite so easily; you'll have to eat slugs and get muddy, and suffer humiliations no secure individual would even tolerate, much less volunteer for.

I don't mean to suggest there's anything wrong with going to Hollywood to be a movie star or getting your pals together and forming a band; if you can make it on talent and perseverence, good on ya. And yes, this is the promise of "American Idol." But if we look a little deeper at "Idol," we realize what it really offers is a short-cut to fame without all those boring years of gigging and writing compelling material: just stand up, sing your little cover song, and voila, a recording contract and instant fame. Heady stuff, indeed.

Hmm, if times are so darn good, why are personal savings plummeting and debt skyrocketing? Does everyone borrow more when their wealth is supposedly rising like a balloon? (Some charts are a bit outdated but the trend remains unchanged.)

And speaking of heady stuff, let's consider why so many Americans are on drugs. On the face of it, shouldn't such prosperous people be happy and secure? If you step back, you have to wonder: why are tens of millions of Americans taking anti-depressants and anti-anxiety medications, and tens of millions more addicted to cocaine, heroin, marijuana, alcohol and nicotine?

Like everything else in our Potemkin Village society, it's all just beneath the surface. People don't like to admit that they're not Superman or Superwoman, so it's only your close friends who will tell you. But check out who's a pothead, who's on anti-depressants, and whose underage kids are drunk--ho-hum, just another normal day in sedated, medicated, drugged America.

You think I'm exaggerating? Then ask your friend who's gone through an addiction or drug rehab program (yes, it may surprise you who you know who has), and ask them about the nurses who are coke-heads, or the software engineers on smack, or the folks who have to have OxyContin, that favorite "relaxer" of right-wing radio demogogues. If you're in law enforcement--well, I'm not telling you anything new. You've seen even worse, the guys doped up on ice (crystal meth), and boy, are they a piece of work.

I'm not questioning the value of anti-anxiety and anti-depressants--I know from the experience of those close to me that they can make a critical, positive difference in the lives of those suffering from psychiatric disorders.

What I am questioning is the high levels of reliance on powerful medications/drugs, prescribed and otherwise, by what seems like an extraordinary number of Americans. Perhaps all humans are unhappy and stressed-out-- but doesn't the culture they inhabit have some influence?

Put yourselves in the shoes of a visiting anthroplogist and look at our society at face value. Yes, all humans like to get happy--beer was invented in Egypt a long time ago, and hey, the residents of Middle Ages Europe had to drink beer because drinking the water would kill you. Yes, the records of cathedral construction crews shows that the guys' portions of ale were spaced out through the day so they wouldn't get too inebriated to work.

(The Chinese discovered that boiling water for tea was another pathway to safe hydration, and I think that may have been part of why they were so far ahead of the Europeans in the Tang Dynasty 700-900 A.D.)

But our objective anthropologist notes that the water is safe to drink in the U.S., and people aren't just having a social drink to relax with friends or after work--they're bombed, doped, medicated, blitzed, day after day, apparently just to survive. What does this say about their culture and society? That it's "normal" and "healthy"? No objective observer could possibly conclude that unless they were in massive denial (and smashed to boot).

No, you have to conclude that this is a society under extreme duress, a culture in which individuals are feeling tremendous stress as a result of the double-bind they live in: you are only worthy if you go to a prestigious university, make tons of money, drive a luxury vehicle, are famous /recognized as wonderful somewhere, are slim, athletic, good-looking, talented, and a perfect parent with perfect kids--and yet most of us are average-looking, with average intelligence and drive (I raise my hand here) and average everything else, too (my hand is still up).

Because we live in a college town (okay, a prestigious university town), we do know super-acheivers. For example: graduated from super-selective law school a semester early, was flown to London all expenses paid for a job interview, was hired at a starting salary of $150,000 or so and moved to London. Good on ya, girl!

But is this individual happy? We hope so, but if she is, it's not because of her apparently perfect career--it's because she found a job which matches her character and interests. The number of unhappy attorneys is legion. (Oh, and California has the nation's only 3-day long Bar exam. Good luck on that, because they only allow 50% of the exhausted students to pass. The test gets harder and harder every year to raise the bar--pun intended.)

Does anyone else see a disconnect between the frenzied drive to attend a private college which costs $40,000+ a year and the fact that tech heroes Bill Gates and Steve Jobs did not finish college? This smacks of a culture so fearful of failure and worthlessness that every ounce of "prestige" must be scrounged like the last scrap of bread in a famine.

Yes, it's important to go to college or acquire a trade/skill--I am only questioning why so many people choose a lifetime of debt in order to go to a private school when a perfectly good public university is probably close at hand. (And if you work your way through, your grades will suffer, but with some roommates and a cheap lifestyle you'll get your degree with a modest loan or maybe even no debt rather than a mountain of debt.)

Is this a culture of secure individuals who don't need external props for their identity and sense of self, who have the confidence to make their own lives and livelihoods without a bunch of paperwork or gew-gaws proving they're Superman or Superwoman? No, it is not. It is a society of adrift, fearful, insecure, stressed-out, unhappy, fragile, vulnerable people seeking external props and cures for what can only come from within.



One of our correspondents (sorry, I can't recall which one, my apologies) recently recommended Maxed Out: Hard Times, Easy Credit and the Era of Predatory Lenders. It's easy to "blame the victim" here (dummy, you shouldn't have signed for that easy loan), and yes, it's a "Buyer beware" world--but still, you have to ask: was it this easy to get huge unsecured loans/credit 20 years ago, or 30 years ago? I was alive then, and working, and I can tell you the answer is no.

Along the same lines, there's a new book titled The Trap: Selling Out to Stay Afloat in Winner-Take-All America about how young people's desperation for "the good life" leads them to work for The Man. Even though those of us who are self-employed have limited sympathy--aw, poor you, you had to work for the mean corporation--well then quit and start your own business--there is a point here worth pondering.

As an example of insecure consumers caving in to the commercialization of identity,there's One Perfect Day: The Selling of the American Wedding which is now like education--you have to indebt yourself for years (or life) just to get a college degree or the perfect wedding. Gag. It costs $50 or whatever to have the judge marry you, folks. Then go home and throw a party. Your happiness will not be impinged one bit.

And as an example of how community identity is also enslaved to the "prestige of a major league sports team," there's Field of Schemes: How the Great Stadium Swindle Turns Public Money into Private Profit . Our schools are shambles, our public employee pensions unfunded and our streets covered in litter-- but wow, take a look at our glittering new stadium! Don't you feel a surge of civic pride? Just be careful after dark around the stadium, of course--you're liable to get mugged.

Bottom line: in an era of supposedly unparalleled, widespread prosperity and wealth creation, the financial and inner reserves of many Americans appears vulnerably thin. Somebody profited from originating all this debt, but nobody forced anyone at gunpoint to borrow it, either.

The dis-ease lies deeper than predatory lenders; they are the pushers, but who's the customer? And why?

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This Week's Theme: The Great Unraveling

Our Schizophrenic Media

This week's theme is The Great Unraveling, in which I present the case that our descent into another Great Depression is close at hand and that the forces behind that descent can no longer be hindered, much less stopped.

And lest you think that doom-and-gloomers have all the fun, this will be followed by a look at the Great Awakening which will take root in the depths of the despair and conflict which will be our lot during the worst of the Great Unraveling.

"The Great Awakening" has spiritual antecedents in American history, but I employ it in a larger context; though a spiritual renewal is undoubtedly part of the context, religious and spiritual do not share the same meanings. For instance, a gargantuan mega-church that cost millions to build is undoubtedly religious, but its spiritual value remains questionable--and indeed, may become more questionable as poverty and distress become ever more widespread.

Let's start with the media, and specifically the print media. Few people expect much of television, radio or Internet-generated news; virtually all the "news" in these media flows from the print media. The headlines in the morning paper generate the "news" on TV; "breaking news" consists of "if it bleeds, it leads" crime and disaster coverage (throw another Christian to the lions, Centurion! The mob, I mean audience, is getting restless!)

Thus the only media with any reputation for in-depth investigation is the print media. TV news makes some laughably inept attempts at "investigating" local issues like drivers education and the like, but let's state the obvious: if the nation depended on local or broadcast television and Yahoo! headlines for its analysis and investigative reporting, our descent to Third World status would already be complete.

Alas, all is not well in Print-Media-Land. Beseiged by Google (Engulf and Devour While We Try Not To Look Too Noticeably Evil) and the explosion of Web and alternative media "channels," its bread-and-butter classified ad revenue gutted by Craigslist, the print media has taken a one-two punch to its glass jaw: declining readership and declining ad revenues.

This has created a double-bind which has in turn spawned a Media Scizophrenia. Double-bind is a term coined by Gregory Bateson, British/American anthropologist, social scientist and general purpose intellectual (Here is his wikipedia entry).

A double-bind is a cousin of Catch-22: a contradictory message or injunction which cannot be resolved. In some families, such impossible-to-fulfill injunctions can lead confused children into schizophrenia. The concept/mechanism can also be at work on a society-wide basis; for instance, "It is easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of God" (Matthew 19:24) versus the message that one's value as a human being rests entirely on who has the most toys, the best botox treatments, etc.

One of the best (short) books on how this works is Politics of Experience by R.D. Laing, psychiatrist and author of The Divided Self and an unreadable but still interesting parsing of Sartre's Critique De La Raison Dialectique, Reason & Violence.

(OK, enough of indulging the aging philosophy major.)

Bottom line: here's the double-bind for the print media: to keep our advertisers, we must lie, but to keep our readers, we must report the truth.

The double-bind is especially visible in real estate coverage. Every shred of good news is duly reported on the front page ("Housing starts rise by .006%," "Prices still Rising in London and Boise") while troubling news ("house sales plummet by 36%") is buried inside, and generally accompanied with happy-happy cheerleading ("This is the bottom, for sure, absolutely guaranteed 100%," said spokesman Lying Whipsnade).

On a larger scale, this pattern is visible on most front pages. In my own hometown newspaper, The San Francisco Chronicle (which just laid off 25% of its editorial staff), the front page has been stripped of important news in favor of "dumbed down" fluff coverage of topics such as "Chocolate is good for you" (huge photo dominated front page above the fold) and the All-Star Game (overpaid steroid-pumped athletes with absolutely no loyalty to any community gather to go through the motions of a game).

Is this the most important news of a nation at war, a nation with a multitude of critical challenges, and a nation teetering on the edge of financial ruin? Chocolate and baseball? Please, spare me the lectures on the stunning importance of "America's game." I attended a San Francisco Giants game a few year ago, and was appalled by the outrageous expense involved. A plastic cup of beer was $7.50 (not even a pint, more like 8 ounces) and a handful of peanuts cost $6 (or was it $10?). Then there was the public transport tickets (or parking, take your pick) and the insanely expensive ticket itself for mediocre seats.

Since when did seeing a routine baseball game require $60 (six first-run movies, 24 DVD rentals, 3 books) to show up and have a tiny beer and a handful of peanuts in lousy seats? Of course $100 will barely get you in the gate for an NFL game.

Rather than glorify this excess, the newspaper should have questioned just how positive this money-driven mania is for the city and the nation. Ah, but the game will bring millions in revenues to the city, and that's the name of the "real game."

In fairness, the paper did run an excellent article questioning the value of publicly subsidized mega-costly stadiums in the Sunday edition: Are stadiums worth the high price? This piece raises the questions which should have been raised on page one. But at least the underlying issues were addressed: should citizens pay for $500 million stadiums so private teams can profit from citizens' misplaced "civic pride" and largesse?

Here we have the double-bind: they can't tell the truth lest they lose their revenue base, but they have to offer some occasional reporting to justify their existence/keep some readers.

Can a nation teetering on the precipice be well-served by a schizophrenic press? Yes, there are still reliable sources of information and analysis (Bloomberg, et. al.), but how healthy can the nation be when the bulk of its media is at best schizophrenic and at worst, already catatonic?

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Are People Sensing Something Is Deeply Amiss?

Correspondent Bill Murath sent in these thought-provoking comments on group consciousness and the tendrils of evidence that Americans are sensing something is deeply amiss:


"It seems on a large scale people are intuiting a change. I am talking more mainstream folks. My buddy Mark whom I am working with is moving back to a farm in North Dakota in a few months. He was up visiting for his parents 50th anniversary and said a whole lot of his cousins who had left the state were moving back for no particular reason. His uncle, a vietnam vet who lost a leg there, just went out with his 2 boys and all bought pistols. For no particular reason. He never owned a firearm in his life.

People I talk to at work ("homeowners"), complete strangers when I can get a good conversation going mention uneasiness or a sense of something changing or not being right. On the one hand the masses now are sensing the change but the power structure of corporate gov't is holding on with everything they have to hold together their Ponzi illusion.

Maybe if we all pull together we can turn the ship."

Correspondent Harun I. (a U.S. Navy veteran who served many years in elite units) had these comments about the July 4th entry:

"I would also like to thank General Taguba. He sacrificed his career for something bigger than all of us, the truth.

In the context of all that is coming to light after reading about the conversations in the New Yorker article that occurred at the highest levels in our government, I wonder how can we think that we are immune to what happened in Germany? Germany was a democracy and for a time was hijacked by fascists. The names were different but they were human beings.

This is why we can’t "wait out" this administration. Waiting out this administration assumes someone better will come along. What if Rudy wins? His track record from New York reveals he has no problem trampling on civil liberties to bring about "security". He believes we should "Stay the Course" in Iraq. Can we afford another extremist in the executive office? After all, IMHO, that what this current president is. He believes that he can trample on the laws of our land because he serves God. He believes that he can launch preemptive wars against those he believes to be evil because he is on the side of God and is therefore right. So we have extremism against extremism.

We, the American people, must impeach. We must send a clear message that we demand the highest morality, ethics, and integrity in those we entrusted and have given the privilege to guard over our nation. We must send a clear message that they serve at the pleasure of the American people. We are not their servants. We must send a clear message to the world that this is a country that respects the rule of law and individual liberty. By removing this president and vice president from office we prove to the world that democracy does work.

I become incensed every time I hear someone in the news say that an American service member died protecting our freedom. Has anyone bothered to look at the relative scope of the "GWOT"? In Iraq there is maybe a handful of Al Qaeda (that weren’t there before our invasion), probably less than 10,000. The insurgency has nothing to do with terrorism, it has to do with occupation. So in Iraq we have roughly the size of a small town grinding down the most powerful military force in the history of mankind.

Globally what are the numbers of Al Qaeda militants? Once again probably less than a small town. Al Qaeda is dispersed and currently is incapable of launching another 9/11 style attack. They have been reduced to a lethal nuisance. But we have spent almost a half trillion dollars with no end in sight fighting citizens who, for the most part, do not hail from any religious or terrorist ideal, they just want us to go home. What does this have to do with American freedom? How has the death of any one of our service members in Iraq maintained or strengthened my freedom?

What happened to our president’s promise to leave when the job is done? He reversed (revealed his true scheme) when he said he wants to have the kind of troop presence we have in South Korea. This madness will lead to an endless insurgency. Perpetual warfare. Terms like the “long war” meant to psychologically prepare us for endless warfare. To what end?

Over 3500 dead in Iraq. We would have been better off spilling their blood at Tora Bora. We had Bin Ladin trapped and let him out because we didn’t want American casualties. Instead we go to war on lies, engage in "regime change" as if the world is ours to do with as we please. To what end? All of our interventions from the past have brought us to where we are today. What makes anybody think they are endowed with some wisdom to make it better tomorrow?

No, we must not wait. We cannot afford another extremist zealot in the executive office. We must send a warning to those who aspire to that high office that they will be held accountable. We have come to accept corruption as normal. This mindset is also dangerous. This is a bad trade and the only way to end the losses is to exit the trade."

Are Americans sensing something the mainstream print media and the TV propaganda machines are avoiding? Why would someone move back to the agricultural heartland of the nation? How about to be close to the food supply, or for the security/protection of a known community?

Why would a combat veteran who has never owned a firearm suddenly arm his family? Is there any reason but defense against a serious threat? And what would cause someone to fear anything in a time of "stock market hits new highs" and "global prosperity that will last for decades?"

Could all that be basically a Ponzi scheme, as Bill Murath suggests, built on a foundation of lies?

When I come across anonymous (always anonymous, it seems) defenders of this administration online, their words have the hollow ring of desperation: "I support my President." Did this individual say the same when Clinton was President? If you're pledging absolute devotion to the office, no selection is allowed: you either support the President all the way down the line or you don't. Somehow I suspect these "support the President" zealots did not support their President during the years 1992-2000 with the same absolutist fervor.

Another slice of desperados brings up Clinton's lies from 1998, as if one President's lies justify another's. Every lie is wrong. Bringing up a past lie does not justify a current lie. The people anxious to dig up past lies are like the spoiled bratty child who defends his theft of a candy bar with the words, "Johnny stole one, too!" as if others' crimes justify their own and absolve everyone of responsibility. Sorry, boys, they don't.

Correspondent Michael Goodfellow sent along this article on just how decimated those Bear Stearns hedge funds are: You know, the ones which are "contained" and "no problem"? Buyers avoid Bear Stearns' cut-priced sale:

"Investors in the worse-hit of two stricken Bear Stearns hedge funds are offering to sell their holdings for as little as 11 cents on the dollar but still finding no buyers, according to unfilled trades on Hedgebay, a secondary market for funds.

Vulture funds and others have been quick to bid for holdings in the two funds, but the best bid for Bear Stearns High-Grade Structured Credit Strategies Enhanced Leveraged Fund, the more geared of the two, is just 5 cents on the dollar.

Private sales of stakes are the only way investors can exit the two Bear funds, after the bank suspended redemptions in May amid a wave of withdrawals.

"There are buyers but they can't agree on price," said Jared Herman, co-founder of Bahamas-based Hedgebay.

The less-geared Bear Stearns High-Grade Structured Credit Strategies Fund, which the bank has rescued with a $1.6bn loan, is being offered at about 70 cents on the dollar. The fund is only attracting bidders at about 30 cents, according to people who use the system.

Market participants estimate the CDOs the Bear funds held would sell for at least 10 per cent less than the values calculated by lenders. "Where things transact is still many points below where dealers have been marking them," said one manager of CDOs and hedge funds. "That is the big ugly secret of this market."

Does any of this strike you as just a tiny wee bit worse than the mainstream U.S. press suggests? A nickel on the dollar means a 95% loss; 30 cents on the dollar for the "high quality" tranches means 70% loss. How much money do you reckon will be lost as the hedge funds, banks and pension funds reporting huge losses turn into dozens, then hundreds or even thousands?

New correspondent E.S. offers an excellent summary of what he succinctly terms "the gradual unraveling" we are now observing:

"What you write about is the gradual unraveling of what was once a great country.

There are four themes that you touch upon but which I think underlie your essays (not my original thoughts):

1) Private splendor, public squalor;
2) Socialize risk, privatize profit;
3) Malignant, narcissistic entitlement; and
4) A something for nothing attitude.

We are quickly creating a non-society, where our interests are limited to what we can get and what we can do for ourselves. This is reflected in our public spaces, in our attitudes toward our neighbors, and in our contempt for so many individuals who make up our society.

I grew up in Philadelphia and spent a great deal of time in the Commonwealth of Pennsylvania. As an example of #1, consider any smaller or mid-sized town in that state. I think of one in particular -- Bedford PA. Modest, well built homes, a small shopping district, a large and beautiful central part (with the requisite statue to the Union war dead), public accommodations (library, high school, VFW) that bespoke of pride in living in a great place -- the town had a center and a soul.

Compare that town (unfortunately dying) to a modern exurb today. Enormous, cheaply built houses (you were/are a carpenter -- I bet there's an essay in you about modern construction) with ostentatious flourishes. Large and soulless malls with thousands of square feet of homogeneous goods made by virtual slaves thousands of miles away. Roads that are over-crowded because we are unwilling to pay for roads. Schools that are an agglomeration of trailers (yes, despite of our public pronouncements that we're doing things "for the children", they are educated in surroundings that look no better than a 3rd world airport terminal). Town center -- none to speak of, aside from a ersatz town green surrounded by stores. Library, civic centers, etc. are old or non-existent.

So we go home to our GarageMahals and complain about the lack of amenities and civic life. It is a world of our own creation."

Well said, Bill, Harun and E.S.--thank you for the insightful commentaries.

Just in case you might think I am a Johnny-come-lately to the bubbles bursting and the rot at the center of our society, please glance at the following entries, and note that I only started my blog in May 2005:

Housing Bubble? What Bubble? Just Look (June 29, 2005)

The Housing Bubble III: Pop! (August 20, 2005)

Since E.S. was kind enough to mention my many years as a carpenter/wood butcher, please glance at these two entries from last year on the construction defects coming to a GarageMahal near you:

Construction Defects: The Flood to Come? (June 1, 2006)

Construction Defects, The Flood to Come, Part II (June 3, 2006)

If you have a little time on your hands, please skim the entries listed in the 2007 archives (by subject) and the 2005-2006 archives (by subject); many relate to the critically important topics raised by these correspondents.

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When Lies Become Normal, Is Truth Dead or Just in Hiding?

Correspondent James C. recently described how "fudging the numbers" is ubiquitous in our society, and how the fudging only forstalls the consequences: (emphasis added)

"Our whole society is based on fudging the numbers. Whether is be reported inflation, GDP, the value of stocks and CDO's or the efficiency of certain drugs, there is some degree of cloudiness in all the numbers. By the way, health risks are calculated the same way. If two people per thousand die of a "X" disease and some bad habit increases ones risk of dying of "X" disease by 50%, then out of 1000 people with this bad habit 3 would die of "X" disease. Hmmm, let's have a beer and enjoy life!

The one statistic that they cannot fudge on is that 100% of us are going to die of something sometime. I think Americans are too obsessed with trying to figure some way to wiggle out of this reality and are willing to place untold financial burdens on future generations in the fruitless attempt to dodge death for another few months or a few years. The medical establishment knows most of us will take about any drug/treatment that is promised to make us feel better or live longer. What a goldmine for them!! The big lie is this: if we can't afford it individually then we really can't afford it collectively. Several trillion dollars worth of debt stand as a mountain of evidence to this fact.

Additionally, insurance or socialized medicine will always create a moral hazard and in the end will raise the cost of health care for everyone. I have health insurance, but pay 90% of my own medical expenses because very few of the treatments that I take advantage of are covered by insurance.

At some point we will have to ration health care. I am not sure how Americans will accept this but probably not with a grain of salt."

James C. raises some critical, long-term issues with enormous consequences for decades to come. If a drug company misrepresents/fudges the efficacy of its "wonder drug," isn't this a lie? And if a government and/or elected Administration tells the public Medicare, or a war, or a giveaway to special interests, is "affordable," even as it saddles our children and their children with a mountain of unaffordable debt, isn't this also a lie?

And if you "fudge the income" on your "no-document" mortgage application, isn't this also a lie? And if you "fudge" the appraisal value on a property at the "request" of the lender, isn't this also a lie? And if you process this application and appraisal, than aren't you lying, too? And when a realtor assured the borrower that they could re-finance to a fixed-rate, low-interest mortgage whenever they wanted, wasn't this a lie? And when the realtor assured the buyer that "real estate never goes down, it only goes up," wasn't this a lie, too? (The statistics of the early 90s retreat in home prices is not a secret.)

And if you assign this mortgage a low-risk AA bond rating when it becomes part of a mortgage-backed security and CDO, then isn't that a lie? And when you, the broker/banker, package and sell this lie to a pension fund as a "safe, high-return" investment vehicle, isn't that a lie? And when a government agency sworn to protect consumers and provide oversight as per the law does nothing to question this contraption of lies, aren't its employees and leadership complicit in the lie?

I think you can see where this leads: the entire housing bubble is constructed on lies. The real estate, home building, lending and investment banking industries have all known the bubble was inflated with one rickety, ill-advised lie after another, as did the government agencies supposedly put in place to protect citizens from predatory lying.

Yet nothing was done or said except by a handful of skeptics in the blogosphere, all of whom were mocked as "doom and gloomers." Now the chickens are coming home to roost, and years after we raised a clarion call of doubt and skepticism, the fumbling mainstream press is suddenly alive with stories about "the subprime mess." Where were these intrepid editors and reporters two or even three years ago?

As a child, I was taught there is a sharp line between truth and lie. If you steal a candy bar, you are guilty of theft, regardless of the value. You can't fudge the theft by saying, "But it was only a candy bar," or "I didn't steal it from a person, but from a rich corporation," or "Everyone steals from the government."

If you misrepresent the truth, you're a liar. There is no "fudging" this reality. And here we have entire trillion-dollar industries built at least partly on lies--lies which are passed along because they benefit the industries' profit margins.

Now as it all unravels, I wait in vain for someone, anyone, to say something simple and direct: It was wrong. But we live in a society so debased from truth that this widespread, ubiquitous lying by realtors, lenders, government agencies, investment bankers, etc. isn't considered wrong, or a violation of the principles of honesty and trust which built the nation; lying is now seen as utterly unremarkable, as "business as usual" -- just as it is in a corrupt and venal third-world or Communist regime that we as a nation like to place ourselves above.

But does this moral superiority have any basis in reality? If business leaders like Jack Welch (former CEO of General Electric) are pleased to pontificate on the glories of American capitalism and opportunity week after nauseating week, we have to ask: does Mr. Welch feel any responsibility to excoriate the liars or "speak truth to power" about the lies at the heart of trillion-dollar industries?

Isn't his silence, and the silence of all the other puffed-up, know-it-all pundits blathering on endlessly about how great everything is and how prosperity is "different this time" feel any responsility to the truth? And since they so clearly have avoided addressing the veritable pyramid of lies this bogus "prosperity" is based on, aren't they, and the media masters who pay them for their punditry, also complicit in the lies?

Let me put it this way: if the kid you're with steals a candy bar, and gives you half, aren't you complicit in the theft? And when you lie to your Mom and Dad about where your half of the candy bar came from, aren't you a liar, pure and simple?

Ours is often categorized as a "deeply religious" nation, but this appears to be yet another self-serving fabrication. I grew up in a family where one's religious beliefs were kept ptivate, not trumpeted over the airwaves. I came from a family of missionaries, some of whom died while serving their mission in Africa. My aunts and uncle were born in El Salvador, where my grandfather and grandmother were serving as missionaries. I am not going to foist my beliefs on anyone, or parade around claiming some high righteousness; but I do know that lying is not "fudging," and "fudging the numbers" in any way, shape or form is lying. And I know that everyone down the line who knows of the lie and says or does nothing to reveal it is also a liar.

We have become a nation of self-satisfied liars, as every report out of Iraq, as every report about the lending bubble, as every report about investment bankers and rating agencies scrambling to cover their tracks, all reveal.

And every editor who plasters a story about baseball or chocolate or pets on the front cover of his/her newspaper/media outlet rather than an investigation of the lies which will bleed us for decades to come, is complicit in the lie, for he/she is the kid who's accepting the stolen half of the candy bar and saying nothing. The candy bar is real estate advertising, and retail advertising, and all the profits flowing into "corporate."

But we may find as a nation that there is a cost to blithely accepting a pyramid of lies. We may find truth hasn't been destroyed, but only driven into hiding. And when truth emerges, a hard rain is gonna fall.

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July 4th Special: The Civilian War on Military Truth

If you think this Administration is doing a peachy job managing the war in Iraq, and/or you distrust/loathe the U.S. Military, prepare for an opposing view.

Is there anyone left in the U.S. who doesn't acknowledge this war was planned, entered and executed on a foundation of knowing, calculated-to-con-us lies? Hopefully not.

Is there anyone who doesn't know the C.I.A. and other intelligence services sworn to serve the nation were pressured to either support or at least not contradict our civilian /elected administration's chosen list of lies and fabrications?

Is there anyone who doesn't know that Vietnam War veteran (wounded in combat, disabled by any standard) General Eric Shinseki was fired and then treated like scum by his civilian/elected Overlords for daring to speak the truth, that the U.S. needed 300,000 to 400,000 ground troops to pacify and control Iraq after the war--precisely what our intelligence services had concluded?

Here's my July 4th thought: our elected officials who are in charge of the nation's military--and by this I mean our Commander in Chief, former Scretary of Defense and on down the line from there-- are unworthy to lick General Shinseki's boots, much less attempt to humiliate and discredit him because his judgment on military matters was at odds with their politically calculated expediencies.

I am also offended on behalf of the many Asian-Americans who have served in this nation's Armed Forces. The 442nd Regimental Combat Team/100th Infantry Battalion, comprised of Japanese-American volunteer troops and Caucasian officers, earned the most combat decorations of any unit that served in World War II. I invite you to visit the 442nd/100th's "Go For Broke" Monument. ("Go For Broke" was the Hawaii-inspired motto of the units; many volunteers left Internment camps to join.) My wife's uncle's name is engraved on the list of those who served.

Here is a description of the unit's service:

"Composed of all volunteers, the 442nd fought in the Italian campaign. The 442nd is the most decorated unit in United States history. In less than two years of combat, the 442nd Regimental Combat Team earned more than 18,000 individual decorations including one Medal of Honor, 53 Distinguished Service Crosses, 588 Silver Stars, 5,200 Bronze Star Medals, 9,486 Purple Hearts, and eight Presidential Unit Citations (the nation's top award for combat units).

In June 2000, President Clinton awarded an additional 20 Medals of Honor to members of the 100th Battalion and 442nd Regimental Combat Team. One of these recipients was Hawaii's U.S. Senator Daniel Inouye, whose right arm was shattered by a grenade while successfully destroying three German machine gun nests. The 442nd/100th sustained 9,486 wounded and over 600 killed suffered, the highest casualty rate of any American unit during the war."

Now you can perhaps partially understand my outrage over the way General Shinseki was treated by this pathetic parade of arrogant liars, none of whom served a day in combat but who have been pleased to lecture the nation about duty and sacrifice for 7 long, hypocritical years. Meanwhile, General Shinskei is serving as the national spokesman for the Go For Broke National Education Center, furthering the nation's understanding of what sacrifice, valor and honor really mean:

"The Go For Broke National Education Center is pleased to announce that General Eric K. Shinseki (U.S. Army, Retired), a Vietnam veteran who went on to serve as the 34th Chief of Staff, United States Army, has agreed to serve as the Go For Broke National Education Center's national spokesperson. In this capacity, General Shinseki will help to ensure that the significant, but little-known, contributions of Americans of Japanese Ancestry during World War II are understood and remembered.

"There is no other story in the history of the U.S. Army like this one, and given the conditions that gave rise to the extraordinary valor of Japanese American soldiers, there may never be another story like it again," Shinseki said, referring to the valor of the 100th Infantry Battalion and the 442nd Regimental Combat Team (RCT), whose prowess in battle resulted in the award of 21 Medals of Honor."

I have many Filipino-American friends, and as a result I am also deeply offended by the way the dishonorable pack of liars in the White House and Pentagon have treated another U.S. Army general whose sworn duty was to the nation, not them: Antonio Taguba.

The entire story can be found in this New Yorker piece by Seymour M. Hersh: The General’s Report: How Antonio Taguba, who investigated the Abu Ghraib scandal, became one of its casualties.

The story is by now depressingly similar: a career Army officer fulfills his duty by telling the truth, and is promptly punished and sent packing by the arrogant politicos who have so badly mismanaged the terribly serious business of war.

here are some excerpts from the story:

"Here . . . comes . . . that famous General Taguba—of the Taguba report!" Rumsfeld declared, in a mocking voice. The meeting was attended by Paul Wolfowitz, Rumsfeld’s deputy; Stephen Cambone, the Under-Secretary of Defense for Intelligence; General Richard Myers, chairman of the Joint Chiefs of Staff (J.C.S.); and General Peter Schoomaker, the Army chief of staff, along with Craddock and other officials. Taguba, describing the moment nearly three years later, said, sadly, “I thought they wanted to know. I assumed they wanted to know. I was ignorant of the setting."

CHS: The setting being a group of political hacks who don't want the public to hear the truth about anything, lest their own lies, deceptions and dishonor be revealed.

"I’ll talk to you about discrimination," Taguba said one morning, while discussing, without bitterness, his early years as an Army officer. “Let’s talk about being refused to be served at a restaurant in public. Let’s talk about having to do things two times, and being accused of not speaking English well, and having to pay myself for my three master’s degrees because the Army didn’t think I was smart enough. So what? Just work your ass off. So what? The hard work paid off."

Taguba had joined the Army knowing little about his father’s military experience. "He saw the ravages and brutality of war, but he wasn’t about to brag about his exploits," Taguba said. On (his father) Tomas’s eightieth birthday, he was awarded the Bronze Star and a prisoner-of-war medal in a ceremony at Schofield Barracks, in Hawaii. "My father never laughed,” Taguba said. But the day he got his medal “he smiled—he had a big-ass smile on his face. I’d never seen him look so proud. He was a bent man with carpal-tunnel syndrome, but at the end of the medal ceremony he stood himself up and saluted. I cried, and everyone in my family burst into tears."

Army regulations required that the head of the inquiry be senior to the commander of the unit being investigated, and Taguba, a two-star general, was available. “It was as simple as that,” he said.

"The dirt and secrets are in the back channel," the former senior intelligence officer noted. "All this open business—sitting in staff meetings, etc., etc.—is the Potemkin Village stuff. And the good guys—like Taguba—are gone."

In some cases, the secret operations remained unaccountable. In an April, 2005, memorandum, a C.I.D. officer—his name was redacted—complained to C.I.D. headquarters, at Fort Belvoir, Virginia, about the impossibility of investigating military members of a Special Access Program suspected of prisoner abuse."


If this doesn't make you want to send the entire Administration from the President on down to Abu Ghraib for high treason, then I recommend you read the entire article--carefully.

Many of you may not know that military service has long been a proud tradition in the Filipino-American community; you may also not be aware that like African-Americans, prior to World War II, Filipinos were only allowed to serve as wardroom staff--waiters and kitchen staff. It was only after the War, and the many sacrifices made by Filipino troops--many of whom rescued or aided American soldiers and airmen fighting in the Phillipines--that these limits on service were raised.

To have such a fine, honorable citizen and Army officer denigrated and shoved into retirement by a pack of liars is more than I can stomach. I don't care who takes over as President in January 2009--I will cheer the passing of this arrogant dishonorable collection of liars and shameless political hacks. How long it will take to repair the damage they have inflicted is unknown, but it will be a long time.

No one has to serve in the U.S. Armed Forces; it requires a devotion to duty not many of us possess. To have those who have served our nation their entire lives insulted by an arrogant, smirking pack of shameless liars--I weep for our nation and those so dishonorably discredited by those unworthy of any office.

Oh, and when the global Depression grabs the U.S. by the throat in a year or two, you can thank this same pack of liars for that, too. (See previous entries for details.)

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