Monday, April 26, 2004

Looking Back at Brown

Last week I participated in a Congress-to-Campus program sponsored by the Center for Democracy and Leadership, which sent me and former Rep. Barbara Vucanovich (R-NV) to Washington State University in Pullman, WA for three days. In the middle of our visit, we participated in a panel discussion sponsored by the Latah County (Idaho) Human Relations Commission on the 50th anniversary of the Brown v. Board of Education decision, and -- in a rare move by a former elected official -- I actually prepared remarks in advance, which became this week's column.

I had a great time in the Palouse, which is what they call the region which includes Pullman, WA and Moscow, ID, home of the University of Idaho, about 8 miles from WSU. It's a pretty remote area, and when you travel there, people appreciate it and are so nice, your teeth hurt. I also had a ball serving as Barb Vucanovich's caddy for three days; the lady is 82 and hasn't lost a step or any of her feistiness, either. She's the kind of Republican you'd expect to represent a district where both gambling (excuse me, gaming) and prostitution are legal.

Newspaper version available here.

East Valley Tribune, Apr. 25, 2004

This spring is the 50th anniversary of Brown v. Board of Education. To prepare for the various commemorations, let’s try a small thought experiment. Put aside the decision, in which the Supreme Court declared “separate but equal” unconstitutional in public education.

If we had no law on this issue today, would “separate but equal” be wrong? If we ever achieved the “ideal” of separate but equal education systems, would that violate your sense of fairness?

It may sound odd to call “separate but equal” an “ideal,” but that’s what it was. It was a theoretical goal, always cited but not actually worth achieving and never actually achieved. Given the realities of the world -- political power, limits on people’s willingness to spend tax money on others, and, of course, prejudice -- can you ever imagine a world where facilities would ever be, and would remain, equal? It just simply wouldn’t happen.

(If merely talking about “separate but equal” as a theory offends you, don’t complain to me. Take it up with Robert Bork -- after all, he wrote the book arguing that Brown was wrongly decided.)

Now, can you imagine a truly color-blind society? Sure, just as it’s possible to imagine separate-but-equal education systems. A truly color-blind society is devoutly to be wished; it’s theoretically possible, but it’s an ideal I doubt I’ll ever see in my lifetime. And you should be wary of people who want you to forget about what you know and see because what you can imagine is so pretty to think about.

The dream of a color-blind society is important, just as poetry is important, too. But you shouldn’t let the poetry of what might be prevent you from seeing what is, including how often times those most vigorous in championing the ideal may benefit the most from preserving today’s non-ideal status quo.

Here’s another thought. In the Brown decision, Chief Justice Warren writes that determining whether separate-but-equal is constitutional depends not on what the drafters of the Fourteenth Amendment thought in 1868, or even what the Supreme Court thought when it decided Plessy v. Ferguson in 1896, but rather on what the very general words of the Constitution mean in the present day.

Brown thus is the key battlefield in the ideological dispute over so-called “original intent” jurisprudence, which would have judges decide cases based on what the Founders meant -- for all time. You can’t rail against “activist” judges “remaking” the law without signing on to legal segregation, because men (it was still just men then) in 1868 and 1896 may have signed on to equality, but they certainly weren’t proposing that the races ever actually mix.

Without those “activist judges,” we would lock ourselves into the moral sensibilities of men who kept slaves -- and who also countenanced a political compromise that let slaveholders count three-fifths of their slaves for the purpose of grabbing power through apportioning seats in the House of Representatives.

Finally, it’s worth looking at the list of attorneys who participated in the Brown case, both the 1954 decision striking down educational segregation as well as the 1955 implementation decision (the “all deliberate speed” opinion). Arguing for integration and equality are great legal names like Spottswood Robinson, Jack Greenberg, William Coleman, and, of course, Thurgood Marshall. Arguing against were various state attorneys general -- major legal potentates of their time, but none remembered today.

Fifty years later, consider how we remember those who fought on each side in 1954. As America continues to wrestle with our racial legacy, with some using the ideal as a shield against progress, how do you want history to remember you five decades hence?

Monday, April 19, 2004

Self-Serving Business Spin

I'm a (very small) Intel shareholder, and they are a pretty arrogant bunch, so I might as well get a column out of having read the annual report.

In following the current dispute over expensing options, I recalled that Intel lobbied me back in 1993 or 1994 about signing on to a House resolution urging (pressuring) FASB not to require expensing of options.  My chief of staff sat through the presentation and after it was all over, asked the Intel guy if they had any ideological qualms about coming to the government with this issue; didn't that go against their usual mantra that they wanted only government to get out of the way of business?  The Intel guy looked sheepish, but quickly got back on message about how expensing options would be the end of our economy, or Western Civilization.  I guess we learned that for many businesses, principles are one thing but money's another.

I didn't understand the issue all that well in 1993, and I would have been happy to do anything that was so ostensibly "pro-business" but, thankfully, I think big business couldn't get what they wanted out of the House but the Senate was more than happy to do their bidding.  The business lobbyists got the Senate to force the SEC and FASB to back down, and then the business types could go back to complaining about government interference and how it was costing them all sorts of money.

So much for my anecdote, here's the column. It's an odd headline, but again, I don't write 'em. Too obscure? Short version: On this issue, go with Warren Buffett and not Craig Barrett. Newspaper version available here.

East Valley Tribune, Apr. 18, 2004

Business types love to trash politicians’ ethics and honesty. But when it comes to defending their own self-interest in not expensing options, Intel’s 2003 annual report proves that some business leaders make politicians look like rank amateurs.

Intel management doesn’t want stock options’ cost deducted from reported income because it’s a “theoretical expense.” Yet Intel’s financial statements are full of theoretical entries, like assumed pension plan asset growth, depreciation, and goodwill. Only when calculating their own compensation does management suddenly doubt their estimating abilities.

Management also opposes expensing options because the cost “is accurately and transparently” reported -- in tiny type, partially in footnote 1 on page 6 and partially in footnote 12 on page 19 of a 34-page financial statement. If that’s “transparent,” I’m the Queen of England. You have to find and read both footnotes to discover how much of the company employees gave themselves, and how Intel’s reported earnings were 15 percent less once you deduct option costs.

“Accuracy,” however, is relative. Intel says the footnotes “accurately” reflect the cost. But in opposing expensing, management complains that current accounting methods aren’t accurate. Intel apparently believes current accounting rules are accurate enough for footnotes, but not for the income statement -- and press releases.

If current accounting methods upset Intel, they have only themselves to blame. When the Financial Accounting Standards Board last considered requiring expensing of options, corporate America responded in the only way they know, by lobbying Congress for special treatment. Congress (led by Joe Lieberman) responded, and FASB backed down.

The companies were so concerned with not expensing option costs that they didn’t much care what valuation method FASB chose; the companies knew that whatever appears in the footnotes didn’t matter much. Now that costs might emerge from the footnotes to the actual income statement, valuation methods suddenly matter again.

Intel management also opposes replacing options with restricted stock, or requiring performance-based options. Why, they say, linking options to Intel outperforming a stock index or its peer companies means the stock price could fall, but because it decreased less than its peers or the index, employees still could earn bonuses!

Forget “could” -- that’s how it actually works now. Yes, it’s technically true, as management claims, that options “provide no benefit to the employee in the event that the stock price declines below the stock option grant price.” This is true in the same way that Bill Clinton “did not have sex with that woman.”

After Intel stock did decline, in November, 2002 the company issued supplemental options to employees whose 2000 and 2001 options had exercise prices above the market price. Management justified the new options as needed “to retain employees, due to competitive market conditions.” Shareholders, of course, did not get a “do-over.”

The stock declined; prior options went “underwater” and became worthless; but the company rewarded employees anyway by giving them new, lower-priced options -- because competitors did it, too!

Options don’t align employee incentives with shareholders, because options are “heads we both win, tails only you lose.” Employees can reap huge awards but risk nothing of their own, while shareholders always risk loss as well as gain.

That options are an expense; that options don’t perfectly align management’s interests with shareholders; that options can be (and have been) abused; that management presumes they’ll do better, at shareholder expense, if options aren’t expensed -- all seem perfectly obvious.

But what’s less obvious is that many of our so-called “business leaders” have nothing on our most self-interested politicians. Intel’s proxy statement proves that nobody who works there has any right to criticize politicians for double-talk and spin.

You guys are the champs, hands down.

Wednesday, April 14, 2004

The Bush Administration Reveals Its Plan For Iraq

From last night's press conference:

Q: Mr. President, who will we be handing the Iraqi government over to on June 30th?

BUSH: We'll find that out soon. That's what Mr. Brahimi is doing. He's figuring out the nature of the entity we'll be handing sovereignty over.

For those of you keeping score at home, Mr. Brahimi is Lakhdar Brahimi, the United Nations Special Representative to Iraq (and Afghanistan). Thus, the Bush plan for Iraq is to take whatever the UN decides. It's not enough that we're using Axis-of-Evil Iranians to negotiate for us with al Sadr; now the Bushies are depending on the UN for giving us somebody to hand over something to on June 30th.

The cognitive dissonance is potentially life-threatening to anyone paying attention. I guess it's a good thing for Bush he doesn't do that.

Monday, April 12, 2004

The Political Is Personal (Because Our Policy Stinks)

Weird headline this week, not quite what the column was about. It's not hypocrisy, but rather the focus on the personal instead of the political--because the political (and the policy) isn't working very well for the Republicans. Newspaper version here.

I especially enjoy this talk about how we can't spend any time looking back and assigning blame, not like how we focused during the late '90's on what was really important: did Bill Clinton lie under oath about sex? When you have a spare moment, compare the budget for the 9/11 commission with the amount of money spent by the Starr investigation. Ah, but those were simpler times.

East Valley Tribune, Apr. 11, 2004

Hypocrisy may be the tribute vice pays to virtue, but during the state budget season, much tribute gets paid to hypocrites, too.

Last Thursday, Arizonans for Cultural Development hosted its annual legislative reception at an Arizona Theatre Company production. ACD brought a number of legislators to a reception, then the play, introducing the dignitaries to the audience before the curtain.

An ACD board member then spoke briefly in support of state arts funding. The Arizona Commission for the Arts funds programs in schools, for people with disabilities, and in rural communities not otherwise able to support the arts. It’s a worthy cause, and one always threatened with cuts every budget.

The evening’s top dignitary was state House Speaker Jake Flake, who perhaps needed reminding that the governor’s budget included the same funding as last year for the Commission, and the state Senate budget includes the same funding as last year for the Commission, but Flake’s House budget doesn’t.

Not only does the current House budget being developed under Flake’s control cut the Commission, but last year Flake voted to eliminate arts funding.

And yet that wasn’t enough. When Gov. Napolitano used her line-item veto to overturn some legislative sleight-of-hand that would have eliminated arts funding, Flake sued to stop the Commission from getting the money.

Now, people who know him say that Jake Flake is a really lovely guy, and is married to an accomplished musician. Let’s concede he’s personally wonderful and really likes the arts. But as a legislator, he’s not only voted consistently against the arts, he filed a lawsuit to stop arts funding. With friends like that, who need enemies?

But that seems to be how politics works, at least in the Republican parallel universe, where actual results don’t much matter, as long as we can make people believe you’re a nice guy. Jake is just our local version of what the right wing is doing nationally.

Just watch the Tribune’s op-ed pages to see this tactic in action. While you may read the occasional plea for substance and issues in the campaign, the facts aren’t really working in George Bush’s favor this year. Instead, we’ll get the Tribune’s Paul Green writing that John Kerry shouldn’t be president because of the way he skis.

Exactly how large would the budget deficit have to become before Bush supporters show a teensy bit of concern? Exactly how much borrowed spending will happen before it’s possible to suggest that we might not be able to afford all those tax cuts, much less making them permanent? Exactly how badly would things have to go in Iraq before the Tribune might consider that Bush might have made just a minor error in postwar planning?

It’s wonderful to hear that we have no choice but to “stay the course” in Iraq. But can anyone explain exactly what is the “course” that Bush has chosen -- other than a July 1 ceremony transferring something (anything) to somebody (anybody)?

In 1988, Michael Dukakis said that the election would be about competence, not ideology. He was spectacularly wrong, and for half of America today, not only is the election still about ideology, but “competence” is completely irrelevant.

We’ve got a president who can send troops to war, but who can’t appear before the 9/11 commission without Dick Cheney. We’ve got a National Security Advisor who says she didn’t get a plan against terrorism, she got only a “list” of “actionable items.” We’ve got deficits, lost jobs, no Iraqi WMD, and Medicare’s going bankrupt.

But that’s only competence, and those failures must not matter. Isn’t how John Kerry skis much more important than mere results?

Sunday, April 11, 2004

More Cycling News

Saturday, April 10: The Desert Classic, sponsored by the Arizona Bicycle Club. 108 miles (it was supposed to be 104 miles, and you didn't learn that it was 108 miles until after you'd already done 104) in 5:59:45. Given that there wasn't any traffic control and far fewer people to work with on the course, I'm thinking that time may be equivalent to an El Tour de Tucson time. We'll see in November.

The Desert Classic is so laid-back, there's no finish line. You make it back to the parking lot, put your bike in your car, then go to lunch. In any case, my best time ever for a century.

Monday, April 05, 2004

Sometimes Being Contrarian Is Contrary To Our Best Interests

I was curious about The Tribune copybook policy on Yiddish. For those of you similarly curious, these days you don't even need to put "chutzpah" in italics in the East Valley. Go figure. Newspaper version here. Any time "Bush" and "extreme" appear in the same headline, it's a minor victory for my team.

Cycling news: El Tour de Phoenix 2004 on Saturday, 3:16:24, making me 202nd out of 590 finishers in the 70 mile event. It's 7 minutes faster than my time last year, but while still 3 minutes off my best time, the overall race was slower; the winning times were 12 minutes slower than last year, so I'm interpreting it as a major victory. It was hard work for the last 30 miles (thanks, Chris!). All 70 mile results here.

In line with the Seinfeld reference, maybe that's what happened to the budget surplus: Shrinkage, Jerry, shrinkage!

East Valley Tribune, Apr. 4, 2004

One thing missing in the well-coordinated GOP attacks on Richard Clarke -- top billing on the Tribune op-ed page twice last week! -- is any factual dispute. Of course Bush, as he told Bob Woodward, had different defense and foreign policy priorities than Clinton.

If Clinton considered non-state terrorism our greatest threat, then Bush automatically disagreed. Bush didn’t make Middle East peace a top priority, calling Clinton’s personal involvement counterproductive. Spokesman Ari Fleischer even said Clinton, by raising expectations, bore some blame for Palestinian terrorism. Fleischer soon apologized, but he certainly revealed the Bush administration’s thinking.

The Bush people rejected everything Clinton. It was their organizing principle. Like the Seinfeld episode where George Costanza decides that success lies in doing the exact opposite of what he’d normally do, the Bush administration was determined to differ from Clinton in every way.

There are positives; where the Clintonites leaked fast and furiously, the Bushies are fiercely loyal, disciplined, and relentlessly on message. While Clinton famously made decisions at the last minute, and only when forced, Bush only knows two things: cutting taxes and invading Iraq. Those are his cures for everything.

Now, this “opposite” business may go too far. Clinton left the largest budget surplus in history, so Bush presides over the largest deficit. Clinton oversaw the greatest post-war expansion in employment, so Bush will be the first president since Herbert Hoover where the economy actually loses jobs during his tenure. We had a strong dollar under Clinton, so it’s weaker under Bush; gas prices dropped, so now they’re rising.

The Republicans applied their opposite strategy to Iraq, too. In December, 1998, they kept referring to the movie “Wag the Dog” in response to Clinton’s air campaign against Iraq. They accused him of bombing some unimportant country to distract people from that oh-so-vital impeachment business.

We now know two things we didn’t in 1998. First, those air strikes were extraordinarily successful. Using intelligence provided by U.N. inspectors, the joint U.S.-U.K. campaign destroyed whatever advanced weapons programs Saddam had. Second, four years later, many of the same people who dismissed the 1998 campaign as a distraction suddenly considered a toothless Iraq our greatest threat. The same people who, on George Bush’s cue, called Iraq the most pressing, immediate, and imminent danger to the U.S. in 2002, considered it an unimportant sideshow in 1998. Apparently, that’s what happens when they stop being distracted by sex -- among heterosexuals, anyway.

And last week we learned that not only will the Bush administration declassify absolutely anything that makes their opponents (or Clinton) look bad, but if there is anything that makes Clinton look good in hindsight, Bush will make sure it stays classified. Can’t let the 9/11 commission see thousands of pages of what Clinton administration documents. To Bush, there are some things just more important than the truth.

Most of the GOP personal attacks on Clarke have a bizarre quality for people whose memories stretch back to, say, 1998. They claim Clarke is a “weasel” because he’s betrayed friendship and loyalty -- but Linda Tripp, the most famous betrayer in my lifetime, is still a hero because her perfidy was just so darn useful. They say you can’t trust Clarke because he’s friends with a senior advisory to Kerry’s campaign, but it’s just peachy for Justice Scalia to decide a case where his duck-hunting buddy, Dick Cheney, is the defendant.

No wonder Republicans object to the 9/11 commission and insist that we look forward -- because anybody who remembers what they said and did five years ago can only laugh, in amazement and in sorrow, at their chutzpah.