Our patchworked bridges, and our children, need a New Deal

(This is a bridge on route 301 on the eastern shore of Maryland. It's beginning to look more like a patchwork quilt than a bridge. Photo by Brent McKee, November 2014.)

 (WPA workers building a new bridge in Harford County, Maryland, 1936. Photo courtesy of the University of Maryland College Park Archives.)

In 2013, it was noted that the "investment backlog for the nation's bridges is estimated to be $121 billion..." Interestingly, the richest 400 Americans have added almost two and one-half times that amount to their personal wealth, in just the past year alone (while enjoying historically low tax rates and a Justice Department that will keep their tax-evading habits secret, should they choose to engage in illegal offshore banking). Of course, all this should come as no surprise since America has adopted an economic philosophy that values personal wealth over the common good and, indeed, over the rule of law. Under such an economic and legal philosophy, it's inevitable that problems like child homelessness and deteriorating infrastructure will worsen right alongside the increasing wealth of the wealthy (see, e.g., "Child Homelessness in U.S. Reaches Historic High, Report Says," Newsweek, November 17, 2014, and "Child poverty in the U.S. is among the worst in the developed world," Washington Post, October 29, 2014).

Our nation's infrastructure--and our nation's children--are on the losing side of an economy that, with every passing year, seems more and more like a zero-sum game (and a fraudulent one at that).

History shows us that it doesn't have to be like this. For example, workers employed in the New Deal's WPA performed 124,000 bridge and viaduct projects (including new constructions, repairs, and improvements). And the wages that these formerly unemployed workers earned helped keep their families intact. A woman who grew up during the Great Depression described the importance of her father's WPA employment, "...my father immediately got employed in this WPA. This was a godsend. This was the greatest thing. It meant food, you know. Survival, just survival" (Hard Times: An Oral History of the Great Depression, by Studs Terkel, 1970). Another survivor of the Great Depression said, "With my family, we would have starved to death, because we had no other way to make any money. The New Deal for us, the WPA in particular, was just a lifesaver for us. Most of our neighbors felt that way" (The Dust Bowl, a documentary by Ken Burns, 2012).

So, we have choices to make: On the one hand, we have our infrastructure, our children, and our economic well-being. On the other hand, we have the personal wealth of a very few individuals who know how to work and game the system to their ultimate advantage. Sadly, it's pretty clear that we've chosen the latter. Hopefully, some future generation of Americans will choose differently--hopefully they'll choose a new and even stronger New Deal.   

The Reverse New Deal: Selling our public spaces, repressing our creativity, and transforming ourselves into low-paid corporate automatons for the 0.1%

(A beautiful, WPA-built school in Circleville, West Virginia. Photo by Brent McKee.)

(A new school in Keyser, West Virginia. The school is almost completely devoid of architectural creativity, and resembles a correctional facility. Photo by Brent McKee.)

Columnist Renee Loth had a great op-ed in the Boston Globe yesterday, observing the cultural degeneration that has occurred in America since the New Deal, with respect to our public spaces. She writes: "Sturdily made, architecturally significant, the New Deal’s public buildings project a sense of authority and even grandeur...They are artifacts of a time when government institutions — schools, courthouses, even waterworks — commanded a certain respect, and the quality of design and craftsmanship reflected that...We have traveled a long way from a time when public buildings were revered precisely because they belonged to everyone. Now public facilities from schools to swimming pools are being privatized. Corporations 'adopt' highways that the taxpayers won’t pay to maintain."

In my travels I have noticed that much of our newer public architecture is as bland as bland can be. Often, new public buildings are little more than brick cubes. I have also seen older, elaborately designed bridges replaced with bridges that look like normal roadway. It seems that trusses, columns, domes, cupolas, ornaments, arches, and anything else that displays human creativity has been banned from public architecture. Today, apparently, the cheapest and most uninspired design always wins the contract.

Meanwhile, as we're playing it cheap with our public architecture, and selling our history to private individuals who live in compounds and gated communities, the "job creators" reward our submission with mundane, low-paying, stingy-benefit, no-future jobs (or, perhaps no jobs at all). See, for example, "Wages and Salaries Still Lag as Corporate Profits Surge," and "Faces of part-time workers: food stamps and multiple low-paid jobs," and "The labor force participation rate is at a low point.")

Welcome to the Reverse New Deal: Selling our public spaces, repressing our creativity, and transforming ourselves into low-paid corporate automatons for the 0.1%.

Only when we return to New Deal policies and principles will this cultural (and labor market) degeneration stop.

700 water main breaks every year in Indianapolis. Instead of water rate increases, how about a New Deal?

(WPA workers building a water reservoir in Loudonville, New York, circa 1935-43. Photo courtesy of the National Archives and the New Deal Network.)

 

A few days ago, a 66-year-old pipe broke in Broad Ripple, a district within Indianapolis, Indiana. A utility company worker said, "The age of the main and the pressure on the system is what caused the main to break. We have 700 water main breaks in Indianapolis every year."

Currently, there are about 22.5 million Americans who want a full-time job but can't find one, and the labor force participation rate is historically low. During the Great Depression, the New Deal hired millions of unemployed workers into the WPA, and these workers installed 16,000 miles of new water lines across the nation. Many of those water lines are still with us today, serving well beyond their life expectancy.

We could do the same today, were it not for (a) our lack of history awareness, (b) our never-ending & irrational fear of bogey-man "Socialism!," and (c) our perpetual worship of the holy "job creators" (as evidenced by our refusal to substantially increase their tax rates) even as the holy "job creators" have shown their incompetence (or indifference, take your pick) at creating good jobs.

(Another New Deal program--the Public Works Administration (PWA)--helped fund infrastructure work across the country. Above, we see workers--most likely private contractors--casting water pipes in San Francisco, circa 1934-38. Photo courtesy of the National Archives and the New Deal Network.)

So, if we're not going to create a new federally-funded WPA to modernize our infrastructure, what are we going to do? Well, one of two things. Some jurisdictions will do little or nothing, and continue to experience dozens, or even hundreds, of water main breaks every year. Other jurisdictions will raise taxes and/or rates on the middle-class & poor to pay for repairs and improvements. As the utility company worker in Indianapolis said, "...we’re talking about old infrastructure that needs to be either repaired or replaced and the only way that we can do that is if we ask for water rate increases." Yes, when we forget our nation's history, and when we tremble under our covers at night in fear of the bogeyman, the only way (the ONLY way) to modernize our infrastructure is by water rate increases that disproportionately burden the middle-class & poor. And so, the utility company did raise rates and more rate increases are likely.

We are living in amazing times. The super-wealthy keep getting wealthier, the political right tells us that we can't tax the super-wealthy because they're the holy "job creators," the holy "job creators" aren't creating good jobs, and the middle-class & poor--whose wages are stagnant--are being asked to shoulder a disproportionate (i.e, regressive) burden for our infrastructure repair & improvement. And, to pour salt into the wound, millions of Americans voted to put more Republicans into Congress, and these Republicans are already crafting plans to lower taxes on the super-wealthy and raise taxes on the middle-class & poor, just as they did in Kansas, wrecking that state's budget (but giving more after-tax income to its super-wealthy residents, thank you very much).

Weep for our infrastructure, weep for our wallets. Corporate America and the political right are having their way with us.

WPA Farmers' Market

Above: The description for this 1938 photo reads, "A Farmer's Market built by the WPA. This market is used by farmers in the community to distribute their salable crops. The market is open for business as market-goers load up their truck." Photo taken in Valdosta, Georgia, and provided courtesy of the National Archives and the New Deal Network.

 

 Above: WPA workers on a Farm-to-Market road project in Prince George's County, Maryland, 1936. The WPA built many Farm-to-Market roads across the country, so farmers could get their goods to consumers, and so consumers could have access to more nutritious food. Photo provided courtesy of the University of Maryland College Park Archives.

 

Above: Be sure to include some fruit in your Thanksgiving eatings! WPA poster, image courtesy of the Library of Congress Prints and Photographs Division.

WPA Poster

(WPA poster, image courtesy of the Library of Congress Prints and Photographs Division.)

The Reverse New Deal: A "Golden Era of White Collar Crime"

Above: William Douglas, left, was Chairman of the Securities & Exchange Commission from 1937-1939. Like other New Dealers, Douglas wasn't afraid of (or bought by) the Wall Street big wigs. He knew that the pervasive fraud on Wall Street had to be cleaned up. When a powerful Wall Street attorney realized that Douglas meant business, he said "When you take over the Exchange, I hope you'll remember we've been in business one hundred and fifty years. There may be some things you will like to ask us." Douglas responded: "There is one thing I'd like to ask...Where do you keep the paper and pencils." After his stint as SEC Chairman, Douglas went on to become the longest serving Supreme Court Justice in U.S. history. Photo courtesy of the Library of Congress Prints and Photographs Division. Quote from "The New Deal: A Modern History," by Michael Hiltzik, New York: Free Press, 2011.

During the New Deal, policymakers took a dim view of white collar crime. They created, for example, the Securities & Exchange Commission to police fraud, and the Glass-Steagall Act to curb reckless financial gambling by the big banks. Heck, even the president of the New York Stock Exchange, Richard Whitney, ended up in Sing Sing Prison.

Today, the story is quite different. Both political parties take obscene amounts of money from corporations and the super-wealthy. Hence, they're not overly interested (or interested at all) in prosecuting the hand that feeds them. And this acceptance of white collar crime by our political "leaders" trickles downward and affects the entire criminal justice system. Today, many white collar criminals, especially those in big organizations, are immune from criminal prosecution. They simply pay fines--fines that are much less than the profits derived from the criminal activity--and then move on to the next fraud.

To make matters worse, a Federal Reserve official recently told U.S. Senator Elizabeth Warren, "We were not willing to find those firms guilty before, because we were worried that if we found them guilty, that could somehow potentially destabilize the financial system" ("The Fed Just Acknowledged Its Too Big To Jail Policy"). In other words, because they were members of large and powerful organizations, wealthy executives were not (and I would argue, are still not) answerable to the criminal justice system.

Above: In this June 22, 2012 Bill Moyers show, journalist and author Matt Taibbi describes, at 14:11, bid-rigging by American's big financial institutions: "...the story I just wrote about, which was about the systematic rigging of municipal bond auctions, which affected every community in every state in the country and all of the major banks were involved, including Chase. They were rigging the auctions...And this is not like something that the mafia does. This is what the mafia does. The mafia has historically, it's one of their staple businesses, bid rigging for construction or garbage or, you know, street cleaning services, whatever it is. They're doing exactly the same thing. The only thing that's different is there's no violence involved. But what their method of control is that they're ubiquitous. They have this incredible political power that the mafia never had."

Many Americans, duped by right-wing politicians, pundits, radio show hosts, and think-tank "researchers," blame public school teachers, unemployed workers, and unions for our nation's economic problems, instead of the white collar crooks running the frauds. This blame switcharoo is surely one of the most astounding developments of the 21st century. It seems that no amount of insider trading, money laundering, price fixing, interest rate rigging, mortgage & securities fraud, accounting fraud, illegal foreclosures on soldiers, bribery, pollution, tax evasion, and so on, will dissuade millions of people from blaming public school teachers and the homeless for our nation's economic woes, and also screaming at low-income Americans to "practice personal responsibility!"

Sam Antar, a man who ran a large financial fraud in the 1980s, recently said "We are in the golden era of white-collar crime. My biggest regret is I should've been a criminal today rather than 20 years ago" ("Crazy Eddie CFO: 'We are in the golden-era of white collar crime,'" CNN, November 17, 2014).

Mr. Antar is correct. This is arguably the best time in American history to be a white collar criminal.

Consider: 

1. Too Big To Jail: In addition to the Federal Reserve official's observation of "too-big-to-jail," that I noted above, Eric Holder, head of the Department of Justice, also implied that big financial institutions are immune from criminal prosecution because such prosecution could have a negative effect on the economy ("Eric Holder Admits Some Banks Are Just Too Big To Prosecute," Huffington Post, March 6, 2013).

2. A Scared SEC: When a prominent and well-respected attorney at the Securities & Exchange Commission recently retired, he asserted that "his bosses were too 'tentative and fearful' to bring many Wall Street leaders to heel after the 2008 credit crisis..." ("SEC Goldman Lawyer Says Agency Too Timid on Wall Street Misdeeds," Bloomberg, April 8, 2014).  William Douglas's they are not. 

3. Hush Money: Author and journalist Matt Taibbi, who has followed corporate crime like a hawk for many years now, recently wrote, "Holder's Justice Department struck a series of historic settlement deals with Chase, Citigroup and Bank of America. The root bargain in these deals was cash for secrecy. The banks paid big fines, without trials or even judges – only secret negotiations that typically ended with the public shown nothing but vague, quasi-official papers called 'statements of facts,' which were conveniently devoid of anything like actual facts. And now, with Holder about to leave office and his Justice Department reportedly wrapping up its final settlements, the state is effectively putting the finishing touches on what will amount to a sweeping, industrywide effort to bury the facts of a whole generation of Wall Street corruption" ("The $9 Billion Witness: Meet JP Morgan Chase's Worst Nightmare," Rolling Stone, November 6, 2014). 

Above: U.S. Senator Elizabeth Warren--the woman who should be the next Democratic nominee for president (instead of Hillary Clinton)--asks various government officials if any big bank executives have been referred to the Justice Department for prosecution. At 4:12, Warren says, "Without criminal prosecution, the message to every Wall Street banker is loud and clear. If you break the law, you are not going to jail, but you might end up with a much bigger paycheck." Near the end of the clip, U.S. Senator Richard Shelby, a Republican from Alabama, says that people should not be able to buy their way out of the criminal justice system and that he agrees with Senator Warren. A rare display of bipartisanship in our Congress.

  
4. A Devil-May-Care Attitude: In November of 2013, William Dudley, head of the Federal Reserve Bank of New York, said that the big financial institutions in America had an "apparent lack of respect for law, regulation and the public trust" ("New York Fed Chief Levels Explosive Charge Against Big Banks," Huffington Post, November 7, 2013). 

5. Illicit Cash Becomes Campaign Cash: In discussing a PBS Frontline report, on the Obama Administration's failure to prosecute financial crimes, journalist David Sirota writes, "(The report) documents the rampant and calculated mortgage securities fraud perpetrated by the major Wall Street banks, who, not coincidentally, were using some of the profits they made to become among President Obama’s biggest campaign donors" ("Are banks too big to jail? PBS Frontline's stunning report shows how the Obama administration undermined the rule of law," Salon, January 23, 2013). 

6. Wall Street's Embrace of Crime: A 2012 survey indicated that "A quarter of Wall Street executives see wrongdoing as a key to success" ("Many Wall Street executives says wrongdoing is necessary: survey," Reuters, July 10, 2012). 

7. A Congress That Encourages Crime: When Republican politicians recently fought to protect wealthy tax evaders, Heather Lowe, of the organization Global Financial Integrity, said "It is mind-boggling that a major political party would even consider endorsing a resolution to facilitate tax evasion" ("Republicans bash U.S. law targeting offshore tax dodgers," Reuters, January 24, 2014).

Above: In this fascinating July 18, 2012, NPR segment of "On Point with Tom Ashbrook," the host asks, at 15:54, "When you look at this, is it a fair question now to ask, somehow, this sounds absurd, but has somehow the banking system become practically a criminal cartel?" One of his guests, Pulitzer-Prizing-winning reporter Jesse Eisinger, responds, "...I think it's beyond a doubt the banking system is completely out of control, that there's an ethical crisis."

Unfortunately, until more Americans become informed, and stop blaming the less fortunate for America's economic ills, the Golden Era of White Collar Crime will likely continue--and perhaps become even worse. Certainly, there is little sign of abatement (see, e.g., "Wall Street Banks Manipulated Commodity Prices At Consumers' Expense, Senate Report Finds," Associated Press, November 19, 2014).

Where's a William Douglas when you need one? Where's a New Deal when you need one?

Shakespeare and the Federal Theatre Present Macbeth

(Image courtesy of the Library of Congress.)