News and Features
The turn of the millennium provided yet another occasion to celebrate a triumphant American Century.
Let's not begrudge Dick Cheney his $36 million income last year.
Sure, it dwarfs the puny $744,682 reported by the President, but George
W. Bush represents old money, and he knows better than to be too showy,
particularly when you're running for office as a Joe Six-Pack kind of
guy. Better to roll over the income from inherited money into
Cheney didn't have time for such accounting niceties. Bush caught him
right in the middle of a tax year with that Vice President nod, and
remember, Cheney was only supposed to be advising Bush on the best choice
for Veep. How was Cheney to know he'd be forced to recommend himself as
the most qualified?
Still, just because he had become Vice President didn't mean he had to
take a vow of poverty. As Cheney told CBS News at the time, "I'd like not
to give away all of my assets to serve the public." And why should he,
since there's no law limiting the assets of federal office-holders or any
requirement that they give up their acquired wealth? Cheney had only to
look as far as Bush, who merely put his in a blind trust, no questions
Huge financial assets are now the norm for leaders of our
representative democracy, and it wasn't unexpected that the mostly
wealthy members of the Senate recently voted rich people like themselves
an enormous tax cut, albeit not as large as the one Bush wanted for
himself and his pals.
Cheney's assets are only at risk of taxation if he wants to leave a
huge amount to his heirs without paying additional taxes. Soon, even that
will no longer be a problem because Bush and Cheney are sensitive to the
unfairness of the estate tax to ordinary people like themselves, and they
want to eliminate it.
What was at issue during the campaign was not Cheney's assets or his
income but his future stock options in Halliburton Co. These being tied
to the rise and fall of Halliburton stock, presented a potential conflict
of interest because, as Vice President, it was conceivable that he could
influence stock prices. Under considerable pressure, Cheney decided to
donate those stock options to charity, but he was left with a bit more
than a hair-shirt.
Even after taxes, Cheney cleared more than $20 million in 2000. If the
Bush tax cut had been in effect last year, Cheney would've saved another
couple of million, to which he obviously feels entitled.
Don't forget, Cheney was playing catch-up after years in the public
sector, first as a congressman and then as Defense secretary. As it
turned out, he only had about five years in the private sector to cash in
his chips, and he didn't really know much about the energy business. When
he hired on to serve as the CEO of an oil services firm, he knew he would
have to justify the big bucks he was getting paid.
Fortunately for him and Halliburton, it all worked out in the end.
For the Texas-based Halliburton, there initially was some concern.
Only two years ago, with the company's stock floundering, the board of
directors chastised Cheney for the company's poor performance. But then
came the presidential election, and those same directors must have
figured they had died and gone to heaven after Cheney got the Veep nod.
That's when the board of directors turned around and rewarded him with an
incredibly lucrative severance package providing the bulk of his reported
$36 million income in 2000.
Can you blame them? Most of Cheney's working hours last year were
devoted to seizing the White House for the most avidly pro-Big Oil
presidency in US history, and servicing Big Oil is what Halliburton Co.
is all about. That and construction projects around the world that an
anti-environmental Administration now seems all too eager to facilitate.
Quite an impressive record for an executive who was just learning the
business. They knew the guy would be good; after all, as a congressman he
had one of most pro-industry voting records. And it was Defense Secretary
Cheney who had made the decision to privatize logistical support
facilities for the military, which gave Halliburton's subsidiary, Brown &
Root, huge construction contracts for the US military at bases
throughout the world.
Of course, as the former Defense secretary who'd saved Kuwait, where
Halliburton has huge contracts, Cheney was already known to be an
effective player. But how could Halliburton have known Cheney would be
this good? Not only did he help elect another Texas oil guy as President,
but if you look at the short record of the Bush-Cheney Administration,
when it comes to opening the environment for energy exploration, even
that most pristine area in Alaska, these guys know no limits.
Indeed, they must be guffawing down in Texas to have two good old boys
running the White House without a scintilla of shame. It's been oil money
Despite all the palaver, the denouement came quickly.
The editors of The New York Times Magazine had a good idea recently.
The financial crisis that collapsed Asian economies in mid-1997 and then bounced around the world was a distant sideshow to most Americans until it reached Wall Street.
A massive natural disaster reminds us why people worldwide have been engaged by the issue of debt relief.
Ajit Singh, who graduated from Punjab University and obtained his PhD at the University of California, Berkeley, is professor of economics at Cambridge University.
Pakistan today is a complete mess, a sad example of what can happen when a once-favored "frontline state" is reduced to the status of a cold war orphan.
If only George W. Bush were content to merely market nights in the
Lincoln Bedroom or issue some questionable pardons, the public would be
much better off. But no, the new President has taken the art of selling
White House access to an unprecedented level, with disastrous
consequences for millions of Americans.
While the media remain obsessed with trying to prove that the Clinton
Administration was on the take from corrupt fat cats, the Republicans
have unashamedly turned over the federal government to the very
corporations that purchased the dubious Bush electoral victory.
MBNA, the world's biggest credit card dispenser, which hooks your kids
with teaser rates that can quickly balloon to usurious proportions, is
about to get the bill ending bankruptcy protection for little people that
it had in mind when it led the Bush campaign contributor list.
The big corporate givers are all lined up with wish lists in hand.
"There is no longer any countervailing power in Washington; business is
in complete control of the machinery of government," former Labor
Secretary Robert Reich concluded recently.
In less than two months, the Administration has reversed workplace
protection for repetitive stress injury, betrayed Bush's campaign promise
to curtail industry carbon dioxide emissions that cause global warming
and revved up plans for Arctic drilling. For all of his belief in a free
market, the President used the club of the state to force mechanics at
Northwest Airlines back to work.
Not that congressional Democrats are without blame. As the bipartisan
support for the bankruptcy bill demonstrated, corporate contributions are
as compelling as they are pervasive.
Bush has indicated he's eager to sign this atrocious bill--an
identical measure was vetoed by President Clinton--which strips away a
century of protection for small debtors. No longer will holders of
unsecured debt, who average $22,000 a year in income, be given a fresh
start. Under this bill, such debtors who file for bankruptcy will not
have their debt eliminated under the easy-to-use Chapter 7 protection of
the Bankruptcy Code but will be forced to file a repayment plan under the
more rigorous Chapter 13. That places this unsecured debt on the same
level as all other claims requiring payment, such as child support and
alimony, leaving divorced spouses and their children competing with banks
for a claimant's paycheck.
At the same time, Congressional Republicans refused to accept any
amendments restraining the marketing of credit cards or the regulating of
usurious interests rates charged. These largely unscrupulous banking
practices that prey upon the young and gullible, with billions of mailed
solicitations a year, is what often leads people into bankruptcy.
What in God's name is going on? The Bible warns against these money
handler who charge usurious rates: "Let the exacting of usury stop" is
commanded in Nehemiah, where the word "usury" is applied to loans among
Israelites bearing a mere 1 percent interest. On a more secular note, the
California Constitution had placed a 10 percent limit on interest, but that has
been watered down by court decisions.
By those historical standards, the current average charge of 18 percent on
credit cards, often rising more than 24 percent, certainly qualifies as
"exorbitant," to use Webster's definition of usury. Indeed, the common
practice of the banks would seem to fall under the category of criminal
loan-sharking, but just try to find a prosecutor with the guts to
classify a leading bank as organized crime.
The analogy with loan-sharking is valid, given that both credit card
companies and gangsters loan money to people who have no means of
repayment. The gangsters compel repayment with the threat of physical
force, and banks will now have the legal intimidation of the courts.
Because Clinton vetoed this legislation, the banking industry weighed
in heavily for Bush in the last election. MBNA employees accounted for
$240,000 in donations to Bush, compared to $1,500 to Al Gore. The bank's
chairman hosted a $1,000-a-plate dinner for Bush, and the bank
contributed a nifty $100,000 to the Bush inaugural festivities.
Financial institutions, which gave Republicans $26 million in the last
election, have been rewarded with quick passage of the bankruptcy bill
that Clinton rejected. The big difference this time around is that Bush
has already stated that he will sign the bill, so there is no pressure on
Congress to build in even the most minor consumer protections.
This year alone, a million Americans, many of them young people
suckered into financing their education by maxing out their credit cards,
will attempt to use the bankruptcy court as a second chance, only to find
the door closed. They should thank Bush the next time an election rolls
During the past two decades, as random financial crises visited various fast-growing economies, we have become familiar, after the fact, with the profile of a developing country that's headed for
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