It snowed again today here in Washington, setting off the usual state of irrational panic in the populous. I had gone in to work downtown very early in order to accommodate a client who, like a great many in this city, confuses getting out of bed at five a.m. with virtue and productivity. He’s in the Civil Service, and his illustrious career has seen him oversee a succession of huge projects, all of which failed miserably due to the fact that he couldn’t manage his way out of a brown paper bag.
To date, his incompetence has cost the American taxpayers slightly over 750 million dollars, all spent with his signature on development of software that proved to be completely useless. But every time one of his projects was about to fail, he transferred out to another agency, and each time into a higher and more powerful position. His last jump was from GSA, where he squandered approximately 240 million bucks on a bureaucratic fantasy he called a “strategically tiered, regionally integrated data environment.” God knows what that’s supposed to mean, and I suspect even He isn’t sure, but the phrase rolls grandly off the tongue, doesn’t it? And all this Civil Service turkey had to do was keep repeating it to his even more lame and clueless Civil Service superiors, and before you could say “screw the middle class,” that bozo had mountains of public funds appropriated to build whatever the hell a “strategically tiered, regionally integrated data environment” is.
All the big consulting and software firms were in on it, supplying platoons of smartly dressed, prolix and jejune young egotists with Ivy League degrees, filling cavernous rooms with Indian and Chinese geeks madly typing away at their state-of-the-art workstations, and, of course, providing plenty of prostitutes to support the effort by having sex of various kinds with important members of the Civil Service, such as this idiot I’m telling you about.
In accordance with the usual practice in the Civil Service, he ordered the legions of geeks to start coding right away so that he could show them off while conducting tours of his fiefdom for visiting bigwigs and issue glowing progress reports citing how many lines of code his minions had written under his wise and dynamic leadership. There was no need for any of the contractors to ever meet anyone who would actually use the system, whatever it was, and whoever those users might be – no, this guy knew what his vaunted “strategically tiered, regionally integrated data environment” would do. Furthermore, he got to his desk earlier than anyone else every morning, and doing that convinced him he also knew how to design the system. Of course, in continuing conformance with the way the Civil Service manages projects, any contractor who tried to do anything sensible was immediately fired. And so, at the height of the software hype cycle, he used all the phony buzz he’d defrauded his superiors, visiting members of Congress and outside auditors with to wangle a nice promotion and a transfer to NASA.
Now, this moron’s “strategically tiered, regionally integrated data environment” was supposed to roll up all his agency’s business information on a daily basis. But in true Civil Service style, when they cranked the damn thing up for the initial tests, the complete sequence of data roll-up, data update, updated data roll-out and system reset took 38 hours. Therefore, every time this pathetic, benighted federal government agency known as the General Services Administration used its “strategically tiered, regionally integrated data environment,” its records went out of date by another 14 hours. Thus, by the end of a year, the agency’s operations would be more than seven months out of date. So don’t let anybody tell you that construction of a device capable of time travel into the past is impossible – here’s evidence it was done at least once, inside the Beltway, at the GSA. Where else?
This was very distressing to the members of the Civil Service at the GSA whom my early morning guest had left holding the bag, of course. Like the average two-year old (with which members of the Civil Service share a number of characteristics) these people were used to having their way and were not please to find that even they could not order the Earth to start turning once every 38 hours instead of once every 24. So they did what all good Civil Service employees do when things go wrong on one of their expensive, harebrained projects – they blamed the contractors. The upper management of these large, august and prestigious firms then did what they always do in such situations – they blamed the people who worked on the project, and fired them all, en masse.
So, the purpose of this fellow’s visit was to ascertain if I would assemble a team of other contractors, including myself, to conduct what would amount to a salvage operation on his pet Frankenstein’s monster. That would help him obtain funds for his current pet monster project at NASA, which, I gathered, will be a sort of software Godzilla that kills astronauts by attempting to make them safer while saving money on Space Shuttle maintenance. But though he mentioned a truly princely sum, I turned him down. He’s got no problem, however; Washington is full of contractors who would jump at the chance, just to get a huge pile of billable hours at extravagant rates. They’re the type who worry about execution and consequences well after they get their grubby hands on the taxpayer’s money, and they are legion.
After I showed that paragon of Civil Service virtues the door, my next appointment was a gent from Kenya, who wanted advice he could pass on to his political compatriots back in Nairobi. But, although he consumed two hours of my time, I remain convinced that the best advice I could give him was “Look, Jomo, when George W. Bush stole our presidential election back in 2000, Democrats did not go around burning down churches full of Republicans, okay? Much as they would have liked to, they nevertheless restrained themselves. And that’s what you and your buddies have to do, too. In a democracy, you always have to keep asking yourself ‘Could it be that this cure might be worse than the disease?’”
After that, I did some work on a deliverable, then left my office at about 11:20 for a brisk walk through the gently but heavily falling snow over to K Street, where I was to meet a consumer advocacy association lobbyist for lunch. It was about ten minutes before noon that I entered a large, mirrored elevator with an eleven foot ceiling and a highly polished marble floor. There were already a couple of other gentlemen in that elevator car, and it stopped to pick up three more on two floors above the lobby. Then, apparently somewhere between the fifteenth and sixteenth floors, the elevator got stuck.
I don’t know if it was the snow or just a coincidence, but whatever caused that elevator to get stuck, being stuck in it was damned inconvenient, to say the least. My first instinct was to open the telephone box and call for help. The other fellows’ first instinct, however, was to pull out their cell phones, Blackberries and so forth, and all start jabbering on them at once.
That sure didn’t make it any easier for me to speak with the strongly accented Hispanic woman who answered the elevator telephone. It took me several minutes to explain our predicament, identify the elevator, give its location and deal with her proclamation that, “Because of the sub-prime mortgage crisis, the building is in receivership and the District government takes care of the elevators there now.” Oh, great. Fortunately, I had made a pit stop in my building before venturing out – if the District of Columbia was responsible for rescuing us, we could be stuck there in that fancy elevator on K Street for quite a while.
After the cell phone cacophony died down to a single fellow arguing with a colleague, I considered it sufficiently quiet to announce the results of my telephone call to my fellow captives. They didn’t take it very well.
“That’s outrageous,” protested a smartly dressed older gentleman. “There’s a 150 billion dollars at stake, and the most powerful man in America is starting a conference call about it in less than an hour!”
“You mean George Bush?” I glanced at him quizzically.
“The President?” He shook his hoary head in astonishment. “Hell no! I’m talking about the Chairman of the Federal Reserve Bank!”
“Bernanke?”
“Damn right,” chimed in a fellow wearing a trench coat. “He’s been talking about stimulating the economy.”
“Well, looks like it sure could use some stimulation,” opined a middle aged fellow in a gray tailored suit. “No telling where it’s going to bottom out. Merrill Lynch just posted a 9.9 billion dollar loss in the fourth quarter – the worst in 94 years! Housing starts are down 27 percent. The manufacturing sector’s slowed down to a crawl. All the stock markets have been headed south by leaps and bounds – the Dow Jones, the Standard and Poor 500, the NASDAQ Composite – all of them, they’re going straight down the toilet! The DJI has lost over 1,000 points this month alone!”
“What do you expect,” asked young fellow with spiked hair, wearing a laptop over his shoulder, “after seven years of a war-mongering Republican administration? George W. Bush did the same thing to the economy that his father did. Does any sane person actually think oil would cost a hundred dollars a barrel if we hadn’t invaded Iraq?”
“Then call me crazy,” responded the old guy, “because everybody knows wars are good for the economy!”
“What?” Obviously, the young fellow with the lap top could hardly believe what he had heard. “The last war that was good for the American economy ended in 1945!”
“Maybe so,” said a tall distinguished fellow whom I recognized as a former Congressman now working for a major K Street lobbying firm, “but I can’t be stuck in this elevator while Bernanke and Bush hand out that 150 billion dollars! If we don’t do something about it, that money might end up in the hands of tax paying citizens instead of in the bank accounts of major corporations, where it belongs!”
“That’s right,” agreed the hoary old gentleman. “Who knows what kind of mischief ordinary citizens could get up to if Bernanke and Bush arranged for them to get that kind of money?”
“What are you talking about?” The kid with spiked hair was plainly incensed. “They would use it to buy food for their families, to heat their homes, to pay for their children’s education and medical care! And what would the corporations do with it? I tell you what – they’d loan it out at obscene rates to companies in China that steal American manufacturing jobs!”
“This kid’s obviously high on drugs,” the fellow in the trench coat stated flatly. “Probably been smoking crack,” he continued, peering at the kid’s eyes. “Yeah, you can see he’s been smoking crack.”
“Well, obviously,” the lobbyist agreed. “Anybody who thinks like that has got to be under the influence of some kind of hallucinogenic compound or another.”
“And what’s this you talkin’ ‘bout then, mon,” demanded the Rastafarian bike messenger, “but nothin’ else than giving the economy some kind of stimulant, isn’t that so?”
“Well,” the hoary old gent sniffed, “if a patient is sick, suffering from a condition of clinical lassitude, diagnosed by a qualified physician, a stimulant is indicated. That’s considerably different from the case where a perfectly healthy person decides to stimulate themselves with something in the absence a doctor’s prescription.”
“Yeah,” agreed the fellow in the trench coat, looking the Rasta up and down contemptuously, “this one’s been smoking pot. They all do.”
“I got my religion, and you got yours, mon,” the Rasta proclaimed in no uncertain terms, “and your doctor is just a big racket, anyway! Hey,” he continued, looking at me, “you’re Tom Collins!”
“Guilty as charged,” I replied.
“Dat’s de mon,” the Rasta vouched, pointing at me, ”he smarter than any of you fools. I know, ‘cause I heard him talkin’ sense plenty of times when I visit his office with a package, and you guys, when I overhear you, you always talking ignorant, mon, like trash pickers at the Kingston dump!”
“Well, then, you’re not visiting my office any more,” the lobbyist told the Rasta. “What do you think of that?”
“I think that’s fine, mon, ‘cause even though you make ten million dollars a year, you never tip!”
“[Expletives] like you are why I quit politics!”
“The Devil’s greed,” the Rasta snarled, “that’s why you quit politics. Now you just a whore for General Dynamics and Pfizer Pharmaceuticals. Mr. Collins,” he went on, “what’s this ‘stimulation’ stuff Bernanke and Bush been talking about now?”
“The general consensus is,” I replied, “that the economy is either very close to or already in a recession. When that happens, the federal government can lower taxes, the federal reserve bank can lower interest rates, or both. Lowering taxes has the effect of leaving more money in the economy, and since banks create money when they make loans, lowering interest rates also increases the amount of money in the economy. Or, I suppose the federal government could rebate taxes to people – mail out checks for 500, maybe a 1,000 dollars; they’ve done that before, too. Anyway, no matter how it gets into the economy, provided people actually spend that extra money, instead of hoarding it, the general effect is to increase economic activity. That’s the stimulant effect.”
“Okay, that makes sense,” the Rasta allowed, “but what you talkin’ ‘bout, saying that banks create money when they make loans?”
“Well, say I’m a banker and you put a hundred dollars in my bank. Then I this fellow,” I said, indicating the kid with spiked hair, “he comes in asks for a loan. So I give him ninety dollars with an agreement he pays me back one hundred dollars by the end of the year. See? My bank started out with your deposit of a hundred dollars, now, poof! Like magic, my bank now has a hundred and ten dollars. I created ten dollars when I made him the loan.”
“But what if I come in and ask to withdraw my hundred dollars, mon?”
“No problem,” I explained, “I give you a hundred dollars cash that some other people left at my bank as their deposits, and at the end of the day, I borrow the ninety dollars I actually didn’t have from Bernanke’s bank, the Federal Reserve. So what interest rate his bank charges mine determines how much of the money I created when I made a loan to this fellow my bank gets to keep. And you know what I do with that ten bucks I created, plus the ninety bucks my bank borrowed from Bernanke?”
“What’s dat, mon?”
“Why, I loan it to somebody else, create some more money, and loan that out, and so forth!”
“Holy [expletive], mon!” The Rasta was flabbergasted. “Forget about the crack and the pot, mon! What in hell have the bankers been smokin’?”
“Hand-rolled Cuban seed tobacco cigars, generally.”
“So what good,” said the spiked haired kid, “do Bernanke and Bush think that doing stuff like mailing us tax rebates or making money cheaper to borrow will be if we spend all that extra money on imported goods?”
“Exactly my point,” interjected the lobbyist. “The average American won’t spend their rebates or tax cuts on American-made goods, even if Bernanke tells them to!”
“This Bernanke’s telling them to, mon?” The Rasta was incredulous.
“Ah, yeah,” the fellow in the gray suit broke in, “as a matter of fact, that’s exactly what he’s doing.”
“Banks makin’ money out of thin air! Bush handing out checks to everybody, tellin’ ’em ‘Quick, quick, now – spend all this money, spend it right away!’ And the Federal Reserve chairman trying to end a recession by tellin’ people to buy American when they spend the money Bush gives them!” The Rasta shook his head, disgusted. “Looks to me like smokin’ expensive cigars causes more brain damage than crack.”
“Well, there’s always investment tax credits or accelerated depreciation schedules,” I offered.
“Much sounder, from a business viewpoint,” the lobbyist chortled approvingly.
“Yeah,” said the spiked hair kid, “because it lines your corporate clients’ pockets with even more undeserved government subsidies!”
“Bush, Bernanke and Congress will probably spread it around,” I speculated, “some rebates here, some temporary expensing there, a moderate interest rate cut… some kind of compromise mix.”
Just then, the elevator began to move. In moments, we were standing on the sixteenth floor watching the Rasta slapping hands with a black elevator repairman wearing a DC Public Works uniform.
“My cousin, Mr. Collins,” the Rasta explained. “When the elevator stopped, I called him right away. Turns out he was right around the corner!”
“Well,” the lobbyist huffed, as he hurried off, “whatever Bush and Bernanke do, they had better do it fast.”
The spiked hair kid adjusted his laptop and glanced at his watch, then turned to me. “What’s he mean by that?”
“What he means is,” I interpreted, “if they don’t do something very soon, the recession will still be raging next November and the Republicans will end up taking the blame for it at the polls.”