CONDEMNED

If a building is structurally flawed and unsafe it gets condemned.

We need a similar solution for our current political system, because it is deeply flawed and unfit for the purposes it is supposed to serve.

The biggest structural flaws are (in no particular order):

• ·         The two party system
• ·         The money influence
• ·         The election system

I see these flaws as interconnected and believe that they each need to be addressed simultaneously if we want our political house to be re-designed to absorb the shock waves that our nation is enduring now and will have to endure in an uncertain future. Having said that, I realize the enormity of the challenge to get anything of this nature implemented. It is no sinecure to turn a battleship around! But the existing structure is falling apart; it is unsuited for future use and ought to be condemned.

THE TWO PARTY SYSTEM

The polarization between the two parties in our current political system has come to the point that it is rendering the whole system dysfunctional. It has become a political suicide for a Republican member of Congress to support a Democratic initiative and for a Democratic member of Congress to underwrite a Republican legislative proposal. The Republican Party will not allow the Democratic Party to be seen solving the nation’s pressing issues and vice versa. The end-result is that nothing of importance gets done in Congress or if something gets done –like the 2010 Patient Protection and Affordable Care Act better known as Obamacare – it is ill considered and ideologically biased. The jealousy and hatred between Republicans and Democrats is such that neither one can stand the thought that their nemesis might have contributed to if not crafted a solution to a public problem. This is why Congress has not taken the first step towards solving the most prominent challenges to our nation faces:

• ·         Deficit elimination and Debt control
• ·         Entitlement Reform
• ·         Tax Reform
• ·         Tort Reform
• ·         Immigration Reform
• ·         Energy policy
• ·         Cyber Space protection
• ·         Infra-structure renewal
• ·         Education reform
• ·         Health Care reform and wellness policy (obesity and drugs)

The obvious solution to the problem is the creation of a centrist third party that is less ideological and more pragmatic and that can govern by forming a coalition either with the right or the left, depending on the outcome of Congressional elections. A centrist party that could attract moderate Democrats and Republicans who want to be freed from the shackles of the ideological extremes within their parties as well as a large proportion of declared independents would, if not by itself, in a coalition with either the Democrats or the Republicans (depending on election results), produce a large enough majority in Congress to break through the existing stalemate.

THE MONEY INFLUENCE

Money, not competency is now the critical success factor for any national elected office and for most of the high profile State and Municipal elected offices. Combined with the freedom of speech, which allows any interest group or superpac to craft any commercial pro or against a candidate for office without regard to truth or material content, money has taken control of the political process in the USA, starting with the election process.

Only in America! Nowhere else in the democratic realm of nations has money taken such a commanding control of the political process and its outcomes. The only saving grace –if you can call it that – is that there are so many rich purses fighting for control that there are off sets and countervailing balances. The result is that hands are tied and nothing of importance gets done.

We are so far along this corrupting road that it is hard to imagine that we are capable of freeing ourselves from the influence of money on the outcome of our political system. But we should try with all of our might and the following steps would go a long way towards removing the controlling influence of money:

• ·         Limit the period during which the media are allowed to run political advertisements in similar ways as currently practiced in Canada and the UK.
• ·         Prohibit private funding of election campaigns and replace it with a system of public funding in equal amounts for each candidate.
• ·         Pay members of Congress a million dollars per year and prohibit them from earning or accepting any money (other than from existing investments) from private sources for the time of their tenure.

THE ELECTION SYSTEM

Many flaws in our current political system are the result of the high frequency of national elections in this country. Congressmen have to go to the mat every 2 years. The President has barely time to get familiar with the office before he gets to get back in a campaign mode for re-election. And –as long as private money is allowed to be used in election campaigns – fund raising rather than governing becomes the most time consuming job for the incumbent.

If, like proposed above, we pay our elected officials royally for serving the nation, let’s have them focus on the job they have to do for us and not be distracted all the time by the need to get re-elected.

The system would also be served by term limits which would prevent Congress from being dominated by career politicians rather than be citizen servants like intended by the Founding Fathers.

Another major flaw of the current system is the absence of any requirement to address in a campaign the most important challenges presented to the nation for which the political system will have to provide solutions.

Case in point in the 2012 elections was the total absence of any discussion among the candidates for national office about how to eliminate the deficits and bring the national debt under control. How can the voting public determine who they want in office if we have to wait and see how the elected official will deal with the most pressing needs of the nation?

For these reasons I believe that the nation would get much better results from Washington DC if the following changes were implemented:

• ·         Establish a list of the major issues facing the nation and require each candidate for national office to publish a position to be taken on each of them. This will help providing a mandate for the elected officials and increase accountability.
• ·         Decrease the frequency of national elections by limiting the office of President to one term of 6 years and by limiting the office of members of Congress to three terms of 4 years for the House and two terms of six years for the Senate.

Are we condemned to live with the flaws in our current political system and accept the consequences of undue influence, politicians who are hand strung and beholden not to their constituencies but their campaign contributors and the resulting dysfunction and paralysis or will we exercise the people power  to condemn the political structure that has evolved over time and bring it “up to code” for the challenges of modern times?

(Frans Jager is Principal of Castnet Corp. (www.castnetcorp.net) a Business Consultant for the Green Industry and an Executive Coach. He frequently writes about matters pertaining to the Green Industry. He can be reached at castnetcorp@gmail.com)

© 2012 Castnet Corp. All rights reserved.

PRAGMATISM VERSUS IDEOLOGY

I just can’t stand on the sidelines and I have to jump in on the discussion about the Fiscal Cliff and the

need to bring the federal deficits under control.

At the time of this writing there is no certainty at all that the Beltway will come up with the collective

political will to avoid the Fiscal Cliff that is looming at the end of the year. In fact there are voices on the

Democratic side saying that a solution might be easier to find if we allow the negatives implied in the

Fiscal Cliff to first take their course after January 1. “Consequences (in the credit‐ and stock markets) be

damned, it is all about gaining the upper hand in the political tussle”.

The monstrous landscape feature that is called the Fiscal Cliff was created deliberately so ugly that the

assumption was that Congress would have no choice but to find a way to address the deficits and the

national debt in a more rational and balanced way than the expiration of the Bush tax cuts and

sequestration.

Remember that the Fiscal Cliff was put in place after efforts to pave the way using a “Super Committee”

of prominent Republican and Democratic legislators had failed to provide a path forward. The Super

Committee (consisting of 6 Republicans and 6 Democrats) was asked to develop a deficit reduction plan

over 10 years in addition to the $917 billion of cuts mandated by the Budget Control Act of 2011, but

was unable to find consensus.

We are now more than a year later and no closer to a solution.

Of course one can expect a degree of posturing, maneuvering and bluffing in the negotiations that are

now taking place, in public and in private, between representatives of the two parties and the White

House, but there is real danger in approaching these negotiations from an ideological perspective. The

danger is that categorically stating that “entitlements are off the table” or that “tax rate increases for

high income earners are out of bounds” raises expectations in the public that almost certainly cannot be

sustained. Everything that makes good fiscal and economic sense should be on the table. That’s why

Grover Norquist’s tax pledge is so damaging.

What is needed now is a pragmatic approach from the White House and the Congress to the solution of

one pressing problem: “How to begin to bend the curve on the increase in the national debt in a way

that helps the economy grow.” Because, let’s face it, if we don’t get back to a healthy growth of our

economy, then there is nothing but pain in the future; pain of a kind now experienced by Greece,

Ireland, Portugal and Spain.

Think tanks have been active in offering frameworks for the kind of “grand bargain” that is required.

Prominent amongst them is “Third Way” publishing a discussion paper titled “The Bargain”, written by

Jim Kessler, Jon Cowan and Ed Gerwin. This document spells out a practical guideline for putting

America back on a path of sustainable growth at an average 3.3% rate that has brought prosperity to the

country between the end of World War II and the start of the 2007/2008 recession.

The Bargain advocates 7 areas of political action:

1. Re‐balance the Budget

2. Become an export giant

3. Reform corporate taxes and business regulations

4. Boost the productivity and educational attainment of the American workforce

5. Become a global magnet for talent

6. Improve infrastructure

7. Spur breakthrough innovation

There is a legitimate discussion about the desirable level of national debt. Borrowing is justified when it

is a means to spurring economic growth, paying for disastrous events like unsolicited wars or natural

disasters and for infrastructure investments. Most households find it desirable to take on debt at certain

times when expenditures exceed current income or to invest in real assets like a home. But households

get worried when repayment of the debt moves beyond their capacity for the future.

The national debt has exploded during the last 22 years from $4 trillion in 1990 to over $16 trillion right

now. In each of the last four years we have added more than $1 trillion to the debt. As a percentage of

GDP the debt has also increased, particularly under the administration of Barack Obama. While the debt

has moved over time in a range from 56% of GDP in 1985 to 81% in 1996, it has now peaked at about

115% of GDP and is projected to go higher from there. In other words our national debt is now larger

than the size of our economy.

It seems to me that the task at hand is design and codify a strategy and a plan that will over a

reasonable amount of time (like 5‐10 years) bring the national debt back to within a range of 50‐80% of

GDP by stimulating economic growth, while reducing government spending. Thereafter the task should

be to keep the national debt in that range, reaching the lower limit in good times and the higher limit in

times of economic distress or national emergencies.

The previously quoted article “The Bargain” provides a plausible pathway for such strategy. I would add

to the 7 steps that article outlines:

8. Complete tax overhaul, including flattening of tax rates, simplification and possibly introduction

of a value added tax on consumption with low rates for necessities and high rates for luxury

items and products that threaten public health like tobacco, alcohol, soft drinks and snacks.

9. Tort reform.

10. Achieve energy independence from sources other than North America.

These ten steps demonstrate that there is a legitimate role for the government to play in stimulating

economic growth. In everything the executive branch and the legislative branch will be prescribing, the

question should be asked “will this promote economic growth” and if the answer is “no” there should be

a compelling need of another kind (like national security, public safety or environmental protection) to

move forward.

Government works best when it is an “enabler” rather than a “doer”. Enabling is generally a lot less

expensive than doing. Herein lies another avenue towards reduced government spending.

It is time for our politicians to leave their ideological biases at home and get pragmatic about solving the

nations’ pressing problems.

(Frans Jager is Principal of Castnet Corp. (www.castnetcorp.net) a Business Consultant for the Green Industry and an Executive Coach. He frequently writes about matters pertaining to the Green Industry. He can be reached at

castnetcorp@gmail.com)

© 2012 Castnet Corp. All rights reserved.