Conservative Ethics Problems

Joshua TrevinoBuzz Feed reported Friday that Red State founder and all around fucktard Joshua Trevino was given almost $400,000 to create propaganda for Malaysia and generally slime people in the pro-democracy movement there. In one way, this means very little. As the story makes clear, mostly Trevino just funneled money to other anti-democracy conservatives who naturally shill for the authoritarian Malaysian government. But in the other way, these people should have said something like, “This authoritarian screed was financed by the authoritarian Malaysian government’s propaganda department.”

One part of Trevino’s behavior was totally unacceptable. Back in 2011, he lost his gig at the Guardian over allegations that he was working for the Malaysians. This caused Ben Smith at Politico to ask him directly if the charges were true. Trevino replied, “I was never on any ‘Malaysian entity’s payroll,’ and I resent your assumption that I was.” This is kind of like it being disclosed that a nanny had been previously convicted of child endangerment. The main difference is that such a nanny would never work in the field again. In Trevino’s case, this complete ethical failure will be at most a blip in his career. The worst you could say is that he probably won’t be asked back on Up with Chris Hayes.

Another part of this story that is remarkable is Trevino’s claim that he didn’t know about the Foreign Agents Registration Unit (FARA) and that he had to file with it. Most people seem to be accepting him at his word. The problem is that even I knew about this (although I didn’t know the name of the agency). He said, “I asked a lawyer friend, my counsel. I said, hey, is there anything I need to comply with? He came back and said no.” A “lawyer friend”? What, over drinks, at one o’clock in the morning? He mumbles out, “Ya thin I’d a fila sumtin wit da gobment?” And his “lawyer friend” replied, “No! What?” If Trevino were a liberal, Fox News would be asking why the government isn’t prosecuting him. And they’d be right to ask.

There is a broader issue here. Why is it that conservatives are so much more likely to be caught doing this kind of thing? I think the reason is clear: there is not really an ideological base for modern conservatism. The movement has turned into a kind of cult that worships money and power, and in a very literal way, those people who have money and power. So to someone like Trevino, opinions are just commodities to be exchanged for money and power. As I’ve written about before, there is an amazing amount of affirmative action for conservatives in the media. I think someone like Trevino would turn liberal if he thought he could sell it. Unfortunately, the field is heavy with talent. But apart from that, the conservative agenda that he shills for is more in keeping with his beliefs. A liberal who got caught doing what Trevino has done would take a big hit on this because other liberals would know that it went against everything that liberalism stands for. There is no such problem with conservatism, as I said.

Joshua Travino is now the Vice President of Communications at the Texas Public Policy Foundation. I’m sure his days are numbered there. If he stays more than five years, I’ll be surprised. Let’s face it, with all this great press, I’m sure that Breitbart.com will be eager to get him.

Kill the Old in the Name of the Young for the Rich!

Dean BakerDean Baker goes after Pew this morning. His problem is with a Pew report that determined how much wealth different age groups had. This has been widely reported and Baker has complained about it before. The problem is not the numbers, which Baker agrees with. The problem is the implication that our seniors are stinking rich at the expense of the young.

The Pew report says that the median wealth of people over 65 is $170,000. This includes all of their wealth: house, car, furniture, savings, stocks, whatever. As Baker points out, this is a little less than the value of the average home in the United States: $180,000. So if these people sold everything they owned, they could reduce their mortgage to $10,000. In that case they would have nothing else, other than their Social Security checks. This doesn’t sound like the definition of wealthy.

There is a ridiculous contrast to this. When discussing raising taxes on the wealthy, we are told that making $250,000 per year is not wealthy. In fact, if we look at the Fiscal Cliff deal, apparently even $400,000 per year is middle class. How is it that reports manage the cognitive dissonance that says that a quarter million a year is middle class while a low mortgage and $1200 per month is wealthy? I think I know: reporters aren’t retired. Most of the people we hear from are in Washington in high profile (and well paid) positions. They know people would make these kinds of salaries and so it doesn’t seem unusual. Most of them do not rub elbows with the 40% of retired Americans who live solely off Social Security. Anyway, as a lump non-taxed sum, $170,000 sounds pretty good; I don’t think it occurs to them that it is all the wealth these people have.

The problem with making a big deal about seniors’ wealth is that it is used as a reason to cut their benefits, as though that will help the young. What the young need is a good economy so they can get good jobs. But cutting government programs for seniors will just hurt the economy and make it harder on young people. The deficit scolds are forever talking about all the debt we will leave to future generations. But the future generations are here now and what they most need is a job.

Yesterday, I was invited by Fix the Debt to write a letter about my fears about the debt. I used the opportunity to tell them that my biggest fear was that groups like them would destroy the economy. I also pointed out that they don’t care about the coming generations. They care about the rich now. The deficit scolds are all about keeping inflation low and the dollar high. These are the policies that the rich want. They what their piles of money to keep their value, and these two things do that. The rest of us want reasonably high inflation so that our debts will go down in value. We also want a weak dollar so that other countries buy things from us and thus we have jobs.

Pew’s report about the “affluent old” is part of this push to destroy the social safety net. It even notes that the total wealth of the young has decreased while the elderly’s has increased. So again: this is pushing things that the rich want in the name of the young. The whole campaign is bad enough. The fact that they use the young as the reason for their concern is disingenuous and repugnant.

Not Bernie Madoff’s Birthday

Charles PonziI used to work for a subsidiary of a company that I believed to be involved in a Ponzi scheme. I was never sure and even if it was going on, I didn’t necessarily think that they knew it. The truth is that it is really easy for an investment company to work its way into one of these. Shortly after leaving Italy, Charles Ponzi ended up working at the Banco Zarossi in Montreal. The bank got into trouble with some bad investment and the president started paying interest with the money from new deposits. That’s a Ponzi scheme. But I doubt that Zarossi thought of it that way. He probably thought he was just taking temporary measures to protect his bank.

What is really interesting is that Charles Ponzi didn’t originally mean to scam his investors. He had a good idea to scam the US government—in a totally legal way. This was right after World War I. Ponzi noted that anyone could buy international reply coupons (IRC) cheaply in Italy and sell them high in the US. There was a 400% margin in this deal. But there was a problem: the overhead was huge. You could only buy and exchange the IRCs individually. So in the end, there was no profit.

That’s when Charles Ponzi became the man we all know and love. He used the plausible story about great profits to be made with IRCs to get investors. And boy did they come. He was offering people 100% return after 90 days. People were very impressed with this given that banks were offering 5% per year. The rest is history. In his later years, Ponzi claimed that it was all about the con, “Without malice aforethought I had given them the best show that was ever staged in their territory since the landing of the Pilgrims! It was easily worth fifteen million bucks to watch me put the thing over.” But I question this. I think this is all historical revision. I suspect that at the time he thought he was just a businessman.

And I think the same thing about Bernie Madoff. I suspect he eased himself into the Ponzi pool slowly. And once he found himself in the deep end, all he could do was tread water. I’m sure when he was pontificating on CNBC that he thought what he was doing was right; to admit that he was billions of dollars into a Ponzi scheme would have hurt investors.

The truth is that Ponzi was right: he did provide a great show. Madoff didn’t. But here’s the thing. At first, Ponzi was a darling of the newspapers. But after a fairly short period of time, he was exposed. In a time when news runs very fast, it took the financial press over a decade to take allegations against them seriously. Harry Markopolos claims that he proved Madoff was a fraud with a 5 minute calculation. The big banks and investors on Wall Street all avoided Madoff because they knew he was a fraud. Yet it went on and on. When it comes to financial matters both the government and the press are hopeless.

But it isn’t Madoff’s birthday today. It’s Ponzi’s. Happy birthday you magnificent bastard!