04 October 2005

Gift Fish.

We have a conservative Republican President in office, indeed, an unpopular not terribly competent one. Corrupt Republicans control both houses of Congress. There is a conservative majority on the Supreme Court and the United State Courts of Appeals have been flooded with conservative judges as well. Elections are destiny right? Nothing good can come of this.

Well, elections are not destiny, and part of playing the political game is to recognize when people you don't like who don't share your values, for reasons utterly differently than your own, somehow end up doing something good. When they do this you should quietly let it happen and not change course when you get back in charge. You should never sniff a gift fish. Surprisingly, the Bush administration has presented quite a few gift fish to progressives, and often we've been so busy criticizing what they have been doing wrong, that we haven't noticed. Indeed, in some cases, a direct effort by progressives to achieve what has been dropped in our laps would have probably been doomed to failure. What am I talking about? Let's review.

The Drug War

The military claims to be able to fight two regional wars at once. The FBI is less talented. The "war on terrorism" has brought the federal part of the "war on drugs" to a screaching halt.

The FBI opened 62,782 criminal investigations in 2000 and 34,451 last year, a drop of 45 percent, [Justice Department inspector general Glenn] Fine said. Drug cases declined by 70 percent, he said.

In New York State, with a Republican Governor at the state's helm, many of its harsh Rockefeller drug laws have been rolled back.

Meanwhile, an obscure constitutional doctrine, forwarded primarily by none other than uber-conservative Supreme Court Justice Antonin Scalia, initially in the Apprendi case, a seemingly minor non-death penalty case, has resulted in the federal sentencing guidelines being ruled unconstitutional in the Booker case. As a result, judges who previously bemoaned unreasonable sentences in drug cases that they were forced by the guidelines to impose can now deviate from them.

(Hat tip to Talk Left for the FBI data).

The Death Penalty

The "conservative" United States Supreme Court has ended executions for people who were minors when their crimes were committed, and for the mentally retarded. Furthermore, hundreds on people on death row had their sentenced commuted when the same Scalia led doctrine that threw out the sentencing guidelines (i.e. that all facts that affect a maximum sentence must be found by a jury using a beyond a reasonable doubt burden of proof), held that their judge imposed death penalties were unconstitutional.

Furthermore, a Republican governor in Illinois commuted the sentences of more than a hundred death row inmates and radically overhauled the state's procedures for imposing the death penalty.

The surrounding controversy about the death penalty has impacted jurors. Fewer juries are imposing the death penalty even when they are given the opportunity to do so. The reduced imposition of the death penalty has also permitted activists to shift some of the focus to the hundreds of thousands of people who have been sentenced to life in prison, often for crimes other than murder, and often despite the fact that they were minors when the crime was committed.

White Collar Crime

Prosecutions for fraud and public corruption may be down, but one can't ignore the fact that a series of high profile prosecutions have changed the corporate landscape for years to come. Senior corporate executives at large publicly held companies like World Com, Adelphia, Enron and Tyco have been convicted of crimes and sentenced to long terms in prison. The accounting firm of Arthur Anderson imploded as a result of its involvement in the Enron scandal. Big four accounting firm KPMG has partners facing criminal charges and has been forced to pay hundreds of millions of dollars in fines in connection with tax shelters they pushed. The investment banks that underwrote World Com's securities have paid billions to settle a class action suit brought by investors. A Republican Congress passed and a Republican President signed the Sarbanes-Oxley Act, one of the most sweeping corporate governance reforms in decades, the Securities and Exchange Commission has tightened its regulation of the markets, litigation has forced Wall Street firms to separate their analysis functions from their sales departments, and the former head of the New York Stock Exchange is facing litigation for his self-dealing transactions. The Martha Stewart prosecution wasn't that important substantively, but did send a message to executives that even sympathetic defendants were not above the law.

Some of this progress has been driven by the tireless efforts of New York Attorney General Elliot Spitzer to crack down on malfeasance in the Manhattan financial district, but federal efforts have definitely played an important role as well.


Bankruptcy reform has been seen by most progressives as an unqualified loss. But, there are some gift fish in this bill as well, and many people don't realize that the most onerous provision doesn't apply to people making less than the median state income (which accounts for about 80% of people who file under Chapter 7 now). Again, the good news is part of a larger effort to crack down on corporate crime which even the pro-corporate Republicans in Congress felt compelled to embark upon in the face of the technology bust and the widespread corporate fraud that accompanied it.

Debts from securities fraud and tax fraud are not dischargeable. It has grown much more difficult to move to a state like Texas or Florida shortly before bankruptcy and shield debts with a homestead exemption. There is an absolute national homestead exemption cap of $125,000 for most people whose debts are connnected with felonies, securities fraud, fraud, or civil liability for intentional wrongdoing. An eight year lookback period has seriously impaired the usefulness of asset protection trusts in bankruptcy. A means test that required all disposable income for five years to be made available to unsecured creditors, with the same flat allowance for a debtor's expenses regardless of income, has made it prohibitively expensive for well paid professionals (who may have committed malpractice), and for well paid executives, who have "primarily consumer debt" to file for bankruptcy to escape debts even when they are truly insolvent. The look back period for preferrential payments to insiders in corporate bankruptcies has been extended from one year to two years, and has been expanded to include excessive payments under employment contracts to insider executives. Severance payments and retention bonuses to insiders in bankruptcy have been greatly limited. The use of Chapter 11 intended for business reorganizations by wealthy individuals to avoid limitations found in Chapters 7 and 13 which are intended for individuals, has been severely limited.

Also important, on a more macroeconomic scale, flaws in the existing code which created a strong incentive for the government to bail out hedge funds to prevent the entire financial markets from crashing down when a few major firms were on the verge of going out of business, have been largely corrected. Under the new law, the impact of the collapse of one firm will be far less widespread. This could save taxpayers hundreds of millions or even billions of dollars the next time a financial crisis strikes.

National Defense

The Defense Budget is soaring to record levels. But, there is some good news here as well. In order to find funds and resources to fight the wars in Iraq and Afghanistan, the administration has finally been forced to take a hard look at Cold War driven expenditures that no longer make sense.

Army units like air defense squadrons and armored units designed to repel Soviet invasions across European plains have been cut, and the now obsolete large U.S. bases in Germany are being demobilized. Purchases of new nuclear attack submarines and destroyers have been trimmed or delayed. Cold War weapons systems like the Crusader mobile howitzer have been cancelled. Purchases of the hundreds of million dollars each F-22 fighter have been greatly curtailed. The Peacekeeper nuclear missile has been retired, and four of our nations fourteen nuclear missile bearing submarines are being converted to use conventional weapons instead.

When the wars in Iraq and Afghanistan are over, those cuts will remain, and many downsized programs are unlikely to be reinstated. Also, while there have been serious costs involved with trying to fight these wars with a large contingent of reserve and national guard troops, the administration's refusal to increase the active duty force will keep that force at modest post-Cold War levels when the United States eventually draws down its force levels in these conflicts.

"Don't ask, don't tell" policies are being questioned now, not because the miltiary brass loves gays, but because they need all the troops that they can get.

The domestic base closure and realignment process has the side effect of materially reducing the political impact of the military-industrial complex on Congress, as many representatives now have fewer people dependent upon the military in their district to lobby for defense spending.

Domestic Spending

For all the talk in Washington of the need to "starve the beast" and drown the government in a bath tub, action has not followed. Rather than making drastic cuts, domestic, discretionary spending has increased during the Bush Administration at a rate greater than during LBJ's Great Society program.

Bush may have set out to gut Social Security, but during his tenure, this program has remained unchanged, while Medicare has actually been expanded materially with a prescription drug benefit.

It certainly hasn't been fiscally responsible to do this while slashing taxes, but the net effect has been that the federal government has not endured the dire cuts that most people expected. The rich have been given a tax holiday for a few years, but the administration's huge deficits have insured that this holiday will not be permanent. It is almost inevitable that a future administration will impose new measures to tax the rich, not because they are motivated by class warfare, but because the government will need the money and the poor don't have an ability to provide those tax funds.


There has been plenty of bad news during this administration. But, for a variety of reasons, it is been impossible for Republicans to govern entirely with the pro-corporate, pro-defense spending, anti-domestic spending, tough on crime agenda that they sell to the voting public. Rather than opposing these developments simply because they come from Republicans, progressives need to accept the gift fish that they have received and adjust their agenda accordingly.

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