Different Day, Same Shit.

In 2008, the United Nations estimated America's total wealth, including human capital, at around $118 trillion. Dr. John Rutledge, economist and former Bush administration tax policy advisor, estimated the U.S. economy's total assets at $188 trillion. The World Bank tallied America's national wealth as of Q4 2011 at $57.4 trillion. Filmmaker and outspoken activist Michael Moore found that the total net worth of the Forbes 400 in 2009 was $1.27 trillion, while the bottom 60% of households held only $1.22 trillion of $53.15 trillion in calculated national wealth for 2009.

According to a study by G. William Domhoff of the University of California at Santa Cruz, 35.4 percent of all privately held wealth in the U.S. is in the hands of only 1 percent of the nation. The mean household financial wealth of that 1 percent was $15,171,600 in 2010.

The U.S. currently has $16 trillion of national debt. The nation's current GDP stands at nearly $15 trillion.

Why the numbers? Because whenever people hear that the U.S. is deep in debt, its $16 trillion of debt obligations are always juxtaposed with its current GDP. It's a nice parlor trick that makes the folks with thousands of dollars in credit card debt see U.S. debt in the same light as their own debt, thereby making them more sympathetic to neo-conservative prescriptions of fiscal austerity. Put that together with instances of wasteful spending and the appearance thereof in a number of government sectors and you have a ready-made argument for taking a chainsaw to programs perceived as wasteful and unnecessary.

However, there's a big difference between national debt and personal debt. Personal debt is personal debt to the average American, unless they're absolutely adroit at precariously juggling credit cards and loans for profit. Unlike most nations, they don't have the power to print currency, backed by their own full faith and credit, in hopes of satisfying debt obligations if need be. Nations use debt instruments to finance their growth, make investments in trusted, secure currencies and even rely on their own reputation and others' hope of long-term gain in exchange for overlooking short-term debt.

When the average American defaults on their debt, they're usually subject to devastating reductions in their personal credit score (which has an ever-growing importance on financial well-being, these days) in addition to wage garnishments and asset liquidation, unless they manage to get from under their debt via bankruptcy. Even then, it's usually a seven-year wait in the fiscal wilderness as they're practically barred from anything other than lending instruments offering usurious borrowing rates.

Things are a bit different for a nation facing a sovereign default:

Defaulting on sovereign debt can be more complicated than defaults on corporate debt because domestic assets cannot be seized to pay back funds. Rather, the terms of the debt will renegotiated, often leaving the lender in an unfavorable situation, if not an entire loss. The impact of the default can thus be significantly more far-reaching, both in terms of its impact on international markets and of its effect on the country's population. A government in default can easily become a government in chaos, which can be disastrous for other types of investment in the issuing country.

It's unlikely that the U.S. is so hard-up for money that it'll go the road of, say...Greece or perhaps Spain. Uncle Sam doesn't have to worry about harassing debt collection phone calls the same way the average American does.

On the other hand, Jerome Hudson, God bless him, is one of those folks who's firmly in the column of people who thinks Uncle Sam has good reason to keep his phone off the hook:

This is obviously a manufactured mantra. There are over sixteen trillion reasons why America is broke. We are a debtor nation. We blow through roughly seven million dollar every minute and about four hundred million dollars every hour. Heck, even the homeless person you pass on the street is in better financial shape than the country is because at least that guy is flat broke and doesn't owe a trillion dollars to the Bank of China.

A few weeks ago, Zimbabwe only had $212 to its name after paying all of its bills, so you'd presume they are in better shape than the U.S., right?

Come to think of it, the Bank of China would be hard-pressed to liquidate America's assets in the event of a default. Unlike someone who missed one too many car payments or skipped out on the Rent-to-Own bills, you just can't send in the repo man. Well, you could, but the consequences could be nasty. Threads-grade nasty.

Nevertheless, conservative leaders are hell-bent on perpetuating Hudson's narrative in hopes of convincing ordinary Americans to dispense with "expensive" social and financial safety nets and accept the prescribed privations of fiscal austerity as the new normal. The narrative sounds good to Americans who see their taxpayer dollars being spent on the wrong people and the wrong things. The push for fiscal austerity, in combination with the GOP's creative sabotage and obstruction of certain social programs, has left America's infrastructural, educational and social systems rotting on the vine.

In the meantime, the proceeds saved from that shared sacrifice aren't directed to things Americans actually need and appreciate - repaired roads and highway infrastructure, education funding, healthcare access, etc. Instead, the proceeds are funneled towards satisfying financial instruments that were largely the cause of America's current recession and obeying the constant demands of global business leaders for more tax breaks and greater monetary incentives.

It's no coincidence that the net worth of wealthy Americans has risen throughout the recession period. There's a quiet, yet noticeable transfer of wealth going on, where ordinary Americans are expected to hollow themselves out and willingly resign themselves to a lower quality of life, only to see what little wealth absorbed by parasitic financial instruments and gifted to a select few "captains of industry." This is deemed proper and fitting and besides, you should have worked harder if you don't like seeing CEOs enjoy filet mignon while you figure out the best way to make the most of your Spam and ramen noodle dinner.

America only has a spending problem in the eyes of conservatives and the investor/rentier class. In their view, America is spending its money on the wrong things (social programs, infrastructure, minimum wage, access to healthcare, a financial safety net in old age, etc.) and not enough money on the correct things (defense, tax breaks, financial rewards for the investor/rentier/industry captain class). The narrative will continue long after Americans accept a complete lack of healthcare, poverty in old age and little to no opportunity for socioeconomic mobility as their new reality.

We only consider the country in debt because we are constantly being told it is, which will make the upcoming sequestration in March a sight to behold. At this rate, we'll keep carving ourselves up until there's nothing left to carve up, all because the conservatives and the investor/rentier class demand it of us.

Ever since Jefferson County, AL's half-cent occupational tax, authorized in 1967 but not collected until 1988, was struck down as "unconstitutional" back in 2011, the county's been out of an estimated $66 million in desperately-needed revenue. It was the proverbial straw that broke the county's back and drove it into one of the largest bankruptcies in recent history.

Now the county wants to resurrect that tax in an effort to get its fiscal house back in order. Except there's plenty of vocal opposition that would rather have the county eat its cold bowl of court-imposed and "taxpayer"-supported austerity. Instead, Jefferson County is being forced to trim back on indigent care, most notably the services provided by Jefferson County's Cooper Green Mercy hospital. Most of the AL.com crowd wouldn't mind seeing the hospital close its doors, despite it serving a significant portion of JeffCo's poorest and uninsured.

Cooper Green is currently some $8.9 million bucks in the hole. The hospital's seen its obstetrics and oncology services put to an end in an effort to cut back on spending. People who can't afford decent care from the other surrounding hospitals may have no other choice but to hit the emergency rooms of UAB and others. Meanwhile, the county is doing its best to shed enough of its budget to meet a $40 million dollar shortfall. It doesn't matter how much that ground glass hurts going down, you have to finish all of your austerity before eating dessert.

The whole point of the occupational tax? There are thousands of suburbanites outside of Jefferson County who commute into the county for work but leave promptly afterwards, with their paychecks not far behind. Most of these people choose not to spend any money inside the county beyond the occasional lunch and a tank fill-up. They don't pay property taxes because they don't live in Jefferson County, but they still utilize the road networks and rely on law enforcement, fire and rescue and other resources.

These folks live in Shelby, St. Clair, Bibb, Tuscaloosa and Blount Counties*, places with much lower taxes and far more conservative social and political mores. As you can imagine, they'll extract wealth from JeffCo, but that's about it. A half-cent occupational tax would go a ways to recoup some of those expenses spent on those commuting into JeffCo.

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The most recent bill drafted by lawmakers, the "Alabama Financially Distressed Counties Act," will give other counties the power to levy their own occupational taxes when they fall between a rock and a fiscally hard place. Unfortunately, those suburban folks are the kind of folks who reflexively twist their faces in disgust over paying yet another (half) penny in taxes, despite effectively having their cake and eating it. But it's not just the virulently anti-tax people who are up in arms over the prospect of an occupation tax.

Part of the problem lies in Alabama's fucked up legislative methods when it comes to county-wide affairs. You see, while most other states give their counties home rule, Alabama...doesn't. In most cases, if you want to get get things done in your county, it has to go through the state legislature as either a local bill, seen and approved by the county's legislators or a general bill, seen and approved by all of the state's lawmakers. It only takes four county representatives in the House or one senator to take a local bill, beat the living shit out of it and toss it into a corner, broken and battered until the next legislative session. This is what the illustrious State Senator Scott Beason did to a prior attempt at resurrecting the occupational tax.

The other part of the problem is the bill authors being their own worst enemies. Sen. Jabo Waggoner and Rep. Jack Williams each pushed their own versions of the "Alabama Financially Distressed Counties Act" as a general bill. Williams managed to get his bill through committee. And then a Birmingham News reporter asked a simple question: whether the bill included exemptions for lawyers, doctors and other professionals.

Keep in mind this was an understandable question to ask. The previous occupation tax had this exemption in place to prevent professionals who were already paying professional license fees from essentially being double-taxed. Rep. Williams answered in the affirmative. And that's where the sugar turned to shit.

You see, Rep. Williams didn't actually read the whole bill, despite being credited as the author. As it turns out, no one actually writes their own bills. Or reads them. Worse, lobbyists and other people with vested interests in legislation are the ones penning the bills:

For Williams, the incident exposed an embarrassing fact about how legislation becomes law. Most lawmakers don’t write the bills they sponsor. This is probably for the best, since many are not lawyers and could do more harm than good if they did pen the bills themselves. What’s more, many lawmakers don’t read the bills, either. Instead, they trust the lobbyists and interested parties who shop legislation to them. This becomes a frustrating and embarrassing problem when pesky reporters ask them about the legislation or when the bills become law and have all sorts of unintended and irritating effects, as Alabama’s immigration law, HB56, had last year.

It might seems silly from the outside looking in, but in a system run by lobbyists and politicians, trust is essential.

That sums up Alabama's entire legislative problem in a nutshell. The legislators are merely figureheads and decoration for the real powers: lobbyists and corporate interests.

JeffCo Commissioner David Carrington neglected to make clear to Williams how the exemptions weren't gonna be in the bill. Whoops. Fortunately, Waggoner's bill had these exemptions, in the form of a deduction from professional license fees as long as the fees were less than the tax. Waggoner's bill made it past the Senate, but it didn't make it past the House County and Municipal Government Committee intact.

...the County and Municipal Government Committee of the House of Representatives today voted 7-4 to rewrite the plan to exempt people who live outside the county from paying the occupational tax.

Jefferson County Commission President David Carrington said that change would reduce revenue from the allowed occupational tax to about $45 million a year.

Opponents of the amendment excluding Jefferson County workers who live outside the county said it would be unconstitutional, since it would create two separate classes of workers.

That defeats the purpose of the bill, which is perhaps the intended effect. The last bill got killed because an "unconstitutional" amendment. Leaving this poison pill in the pie could get the whole thing thrown out at some point.

Wednesday is the last day of the current state legislative session. Unless the governor feels like opening a special session, this may be the last chance for the county to see a solution to the fiscal problems ailing it.


*There's an urban myth out there that Walker County residents actually commute into JeffCo. I doubt the veracity of this myth, as most Walker Co. residents have traded their wheels for cinder blocks.

The New York Times has a rather thorough article on the Jefferson County, Alabama bankruptcy and the sewer debacle that started it all. I covered this in a previous blog post, which also contains a link to the even more detailed Rolling Stone article authored months ago. I guess since the NYT had its content ripped by those bastards over at Fortune, they had to make up for lost eyeballs with a quick rehash of old news.

Meanwhile, governments all over the globe are responding to economic crises with resounding cries of Austerity™. In a quaint three-bedroom villa on the outskirts of the European Union suburbs, Daddy Germany and Momma France want Greece and its fellow PIIGS siblings (Portugal, Ireland, Italy and Spain) to eat a piping hot, value-sized portion of Austerity™ for dinner, on the auspices of it being healthy for them. Greece set itself on fire at the kitchen table in protest, while the rest of the PIIGS went to their rooms without supper. But seriously, Greece is hurting in a bad way. Deep in debt, with no way of practicing their traditional solution of currency devaluation (because Euro) and with tax evasion a national pastime, the Greek government is busy cutting whatever scraps of fat they can find to stay afloat, even with Germany secretly wanting the country to emancipate itself declare bankruptcy and get the hell out of the house Euro.

Austerity™, according to conservative fixtures who fancy themselves as being learned in economic matters, supposedly works by drastically cutting worker pay and benefits, social services deemed unnecessary and even essential services to the bone, not to mention helpful programs that are considered "entitlements" by the conservative set. Spending is drastically lowered, while taxes are also lowered or at least held at the same rates. In other words, it's the government pretending to budget like an ordinary household of five.

In the case of the United States, it's a household of five where the hubby only spends his money on guns and countless rounds of drinks for his wealthy buddies from the office. Apparently, if he shows he can flash a little cash and kisses enough wealthy buddy ass, he thinks they'll let him in the country club and they'll all be BFFs 4eva. Meanwhile, the wife works, but nearly every single dime she makes winds up in hubby's hands. They barely have enough for the necessities and niceties like new clothes for the kids or a decent night out for the wife are deemed "entitlements." The family trucks no handouts and despite scraping by on the thinnest margins, sincerely believes that if it just cuts back on the food and the utility usage, they'll be able to put back enough money to get themselves back on track again, despite hubby getting his paycheck cut once again and all of their savings going towards more guns for hubby's collection and more rounds of drinks for the wealthy boys back at the pub.

So what does Austerity™ have to do with a county that's knee-deep in debt accrued from what turned out to be a massive fraudulent subprime loan?

Well, when you think about it, the later stages of Austerity™ involve the family selling off the prized family silver and jewelry. For countries, those jewels are public infrastructure, already built and just waiting to be sold to creditors and private interests for literally pennies on the dollar. In other words, Austerity™ eventually turns a country into a glorified estate sale.

For Jefferson County, that may involve selling off portions or even the entirety of the Jefferson County sewer system. Now there's a public asset that a private company can use to make money hand over fist. And that's the whole point - a private entity taking hold of a formerly public asset that features a built-in captive consumer base and a license to literally print money. It's Comcast (or AT&T) sipping a steroid/crack smoothie infused with meth crystals for added punch.

Conservatives are happy about how this shit is well on its way to hitting the proverbial fan, as it supposedly validates the continuing cries for "small government," which, if you're reading the news these days, turns out to be a government that funds moral busybodyism (banning abortion and gay marriage), wealth worship (more tax cuts to wealthy individuals and corporations, with looser or nonexistent regulations) and unbridled aggression (see our military funding sometime) while condemning and defunding things that actually help people (national healthcare, social programs, etc). It's a government run on the Just World fallacy with Dickensian logic. Many of the suburban and rural collapse fetishists are banking on the county keeling over (and the city of Birmingham along with it*) just for the validation of their world view such an event would bring - "the county was a liberal shit pool that blew up because it wouldn't follow the hallowed way of conservative 'small government'."

The whole concept of the "just-world hypothesis" is interesting. It's essentially a coping mechanism that shields people away from the feeling of overall vulnerability, in order to maintain the mystique that you're in control of your own affairs and that you and yours aren't susceptible to the slings and arrows that seem to plague others. Whether it's poverty, discrimination, sexual assault or even death, if you can believe that those are things that happen to other people for some reason that they could control, you won't feel so vulnerable.

The economy is still circling the shitter, for all intents and purposes, and with the growing number of unemployed and the domino effect unemployment has on people's finances and social lives, it's no wonder the just-world hypothesis is catching on with people who don't want to see what's happening to their fellow Americans happen to them and theirs.

That could explain the following. Or perhaps it's just a case of Michigan Republicans being assholes, again:

An undetermined number of Michigan's nearly 2 million food assistance recipients will lose the help under new eligibility requirements the state will begin using in October.

Michigan has determined food assistance eligibility based only on income for roughly a decade. A new policy will include a review of certain financial assets starting Oct 1. The requirements will affect new applicants right away and existing recipients when their cases come up for review, which typically happens once every six months.

Those with assets of more than $5,000 in bank accounts or some types of property would no longer be eligible for food assistance. Other assets that would count against the cap include vehicles with market values of more than $15,000 and second homes, depending on how much is owed on the properties.

Apparently this is Michigan governor Rick Snyder's attempt to get those freeloading Cadillac-driving welfare queens off the public assistance rolls. For those who're already living on the bleeding edge of poverty or somewhere close to it, it's not gonna affect them much. These people thrive on paid-for beaters worth $500 to $2000, dream about owning second homes and the only time they'll have more than $5k in the bank is during tax season.

But this is gonna suck for those once-well-off middle class families who fell on hard times and need a helping hand, as opposed to a boot to the face. Unless you're willing to sell off your car and other assets, and then drain away your bank account, you're out of luck as far as the Rickster is concerned. If you have $5k in the bank, then you don't need food stamps until you've run through that $5k feeding yourself and your family. Then and only then will you become worthy enough to be blessed with a helping hand from a government that would rather not lend one.

And conservatives will go along with this. Combine the just-world hypothesis with America's unique Puritanical views on poverty and sense of achievement, and you have a situation where being poor is seen as a moral defect in which the poor are perfectly capable of controlling at their leisure. In fact, poverty is sometimes seen as a leisure activity, with the poor being "lazy" and whatnot. Sometimes I get the feeling these folks actually think the poor enjoy being in poverty.

For those deep in the just-world hypothesis shit, if you can wail on those poors with austerity-minded legislation that instead transfers wealth under your dull noses and into the bank accounts and investment portfolios of your "betters" (the ones whom deserve all of your praise, with wealth equaling smarts and ambition and drive and whatnot), then you can keep on feeling somewhat impervious while satisfying the bitter asshole that lies in just about every person on Earth.

Some assets, such as primary residences and 401k accounts, would not be considered for determining food assistance eligibility.

Gee, well isn't that swell. Most people can tell you the value of their 401k accounts with only one hand, at best. If they're lucky to have a 401k. I guess the 30,000 college students who were recently kicked off the food stamp rolls wished they had 401k accounts. The ones that actually do happen to be legacy students in Ivy League institutions.

Food assistance benefits came under some scrutiny earlier this year when it was revealed a Michigan man had continued to get food aid from the state despite winning a $2 million lottery jackpot.*

There are a number of people out there who believe if the government's dumb enough to give out "freebies," they're gonna take the government for all they can. Outside the financial and military contracting sectors, this particular philosophy isn't all that it's cracked up to be. But it's like the fine folks in Texas who took away those last meals from death row inmates on account of one stubborn fella -- it's any excuse to bring the hammer down on everyone for the transgressions of a select few.

*To be perfectly honest, $2 million isn't a whole lot of money, especially if that amount happened to be pre-tax. No wonder that person stayed on food stamps.