Jack Lessenberry Essays and Interviews

Essay: Financial Crisis - 9/23/2008

There is an old story about a farmer who has a very stubborn mule who he suspects is actually very sick. Finally, he grudgingly calls a veterinarian, who comes out to the farm. The vet studies the mule intently for about ten minutes. Finally he picks up a two-by-four, swings it as hard as he can and clubs the animal over the head.

“I hired you to cure him, not kill him!” the farmer says.

“Yes, I know,” says the vet. “But I had to get his attention first.“

Well, it strikes me that something like that has happened with us, and the national economy. Two weeks ago, the President, the treasury secretary, and the Republican presidential nominee were all saying that economy is fundamentally sound.

We knew better here in Michigan, of course, but we thought we were a special case. A “one-state recession,” they called it. Then, suddenly, things started rocking and rolling on Wall Street last week.

Finally, four days ago, we were told that we were facing the worst financial crisis since the Great Depression, if not ever.

The only solution, we were told, was to have the Federal Government ante up an immediate $700 billion dollars to buy up all the bad mortgages in the country. I could barely believe my ears.

I tried to imagine what would have happened if Barack Obama had suggested that ten days ago. He would have been called the second coming of Chairman Mao.

But here was the Bush Administration, demanding that we provide cradle-to-grave welfare protection for mortgage speculators. It was enough to make you forget Sarah Palin.

In fact, everybody did forget Sarah Palin. However, to the President’s profound annoyance, the Democrats who control Congress are insisting on asking questions about all this.

And we should all be thankful that they did.

Frankly, there does seem to be no doubt that we are in the worst financial crisis since the Great Depression. And there are some quite sober economists who say that if we screw this up, the result could make the 1930s look mild.

I heard a shocked Chris Dodd of Connecticut, chairman of the Senate Banking Committee, refuse to say exactly what he had been told about the true condition of the economy. He seemed to fear it might inspire mass panic. But he is openly skeptical of the solution.

There are even a considerable number of Republicans who remember voting for war with Iraq, not questioning this Administration’s assurances that they had to do that right away, because of the weapons of mass destruction we knew were there.

It seems to me that few days of collective reasoning and analysis are exactly what we need right now. Yes, we need to fix this.

But we need to try to make sure we know what we are doing first. And then people in the media, as well as the government, need to ask why nobody seemed to see this coming.

I suspect the answers will leave none of us very pleased with ourselves.

Hear Audio Story   

Interview: Sreedhar Bharath - 9/23/2008

The nation’s financial markets continue to be rocked as Congress debates whether or not to pass an emergency bailout plan. But, it’s hard to know how it will affect us average citizens. Sreedhar Bharath is a professor of finance at the University of Michigan. He’s also an expert on the banking industry. Michigan Radio’s Jack Lessenberry spoke with him.

Hear Audio Story   

Essay: Voting Right - 9/22/2008

I think we sometimes forget what a brutal shock it was for millions of Americans when, in November 2000, we learned that we could go to the polls, cast our votes … and they might never be counted. Or worse, they could be counted for another candidate.

That’s what happened to thousands of voters in Florida that year, and perhaps elsewhere. A misshapen voting card called the “butterfly ballot” caused some voters in Palm Beach County to vote for Pat Buchanan, when they clearly meant to vote for Al Gore.

Worse, much of Florida still used the old-fashioned punch card voting machines. We got an education that year too in why they were a bad idea. Sometimes, if you didn’t punch hard enough or the card was improperly perforated, the little chad didn’t fall out.

And then, once again, your vote wouldn’t be counted. That year, every time they ran the voting cards through the counting machines, more chads fell out, giving them different results.

In the end, George W. Bush “won” Florida, after the U.S. Supreme Court stopped the series of recounts that December.

There seems little doubt that more Floridians intended to vote for Gore than intended to vote for Bush. But thanks to hanging chads, the butterfly ballot, and political judges, Bush was certified the winner, by a few hundred votes out of six million cast.

That result gave him the presidency, though nationwide, Al Gore had a popular vote plurality of more than half a million.

Americans are still shocked by what this exposed about our voting system. That‘s perhaps especially true because the so-called “selected presidency” that followed is anything but wildly popular.

Immediately after that disputed election, secretaries of state all over the nation went to work trying to fix their state’s potential voting problems. In some places, including Florida, things seem improved.

But our elections aren’t perfect yet. Not in Florida, which will scarcely come as a shock, but also not in a lot of other places, including Michigan. And my guess is that a lot of people here will be surprised by what Common Cause and the Century Fund concluded about our fair state.

Michigan election officials like to think they cleaned up their voting procedures after two messy elections we had, in 1950 and 1952. Secretary of State Terri Lynn Land is especially proud of a centralized, statewide database she calls the “Qualified Voter File.” Common Cause agreed it is a great thing.

But the public service group was a lot less happy about the way we handle ballots cast in the wrong precinct, and about the way poll workers are recruited before each election.

Nor did Common Cause think we are doing enough to make sure there are enough voting machines everywhere. The only time we had a breathtakingly close presidential result in this state was in 1940. This year could produce another one.

Michigan has more than enough troubles right now. We should do whatever we can to make sure we don’t become the new Florida.

Hear Audio Story   

Interview: Tova Wang - 9/22/2008

Eight years ago, during the Florida recount, we learned just how dysfunctional elections in this country can be. And, four years ago Ohio was struggling to figure out provisional ballots. Now, as we approach another presidential election an important question remains: is the nation’s voting infrastructure ready? Tova Wang is vice president for research at Common Cause. The public service organization teamed up with the Century Foundation and has just completed a study of voting preparedness in ten swing states. Michigan Radio’s Jack Lessenberry spoke with her.

Hear Audio Story   

Essay: Deer Hunting - 9/19/2008

State Senator Jim Barcia of Bay City usually knows what he is talking about. Matter of fact, he used to be a congressman, before redistricting eliminated his seat. He’s a sportsman himself who currently head of the Senate’s hunting and fishing committee.

And, he thinks it is a little crazy to ban deer baiting in the entire Lower Peninsula because one case of chronic wasting disease was discovered in one deer in one enclosed facility near Grand Rapids.

Barcia was quoted as saying he feared we were overreacting, and it is easy to see why he thinks so. First of all, he is bound to have heard from irate voters. There are a lot of folks who sell deer bait this time of year, and he has just taken their livelihood away. There are also a lot of folks who have already bought bait.

Now, you could get 90 days in jail if you are caught feeding carrots to deer. Actually, it is still legal to sell it, just not to use it.

So, if you have already bought a truckload of deer carrots, you could always decide to breed a flock of guinea pigs instead.

Well, I sympathize with Senator Barcia, and freely admit my knowledge of hunting is limited to knowing that I should stay out of the woods when I am wearing my brown suit on November 15.

However, I think he is wrong and the Department of Natural Resources is right, and here’s why. Chronic Wasting Disease, or CWD – is absolutely awful. It spreads easily, especially where there are concentrated deer populations. Every deer that gets CWD dies from it. While there are no verified cases of transmission to humans, scientists are also unable to rule out that possibility.

The disease is easily spread among animals who share the same feed. And while there’s been only one confirmed case of CWD in Michigan, lots of infected deer have been found in Wisconsin.

That has devastated hunting there and in a number of the other eleven states where CWD has been discovered. In some places, people have been so scared of possibly getting it that they have stopped hunting. If that happens here, it would have a major economic impact. Plus, while science still needs to learn much more about chronic wasting disease, some studies indicate CWD can kill off as much as 70 percent of the deer population.

If that were to happen, or even if we had a number of confirmed cases, deer hunting would be dead in Michigan. Depending on how you count, hunting pumps between half a billion and a billion dollars into our economy. And this state needs any economic stimulus it can get right now.

My guess is that smart hunters can figure a way around this. There are other ways to attract deer, including “aromatherapy” – products that give off a scent that deer find attractive.

Nobody likes to be told they can’t do something they want to do. But sadly, that’s what being an adult is all about.

Hear Audio Story   

Interview: Russ Mason - 9/19/2008

The first of Michigan’s several deer hunting seasons is approaching: youth and disabled veterans can take to the field on September 27th, followed by bow hunters on October 1st. But the season has already been dampened for some due to a total ban on the bait many hunters use. Russ Mason is the new chief of the state Department of Natural Resources’ wildlife division. He held a similar position in Nevada. Michigan Radio’s Jack Lessenberry spoke with him.

Hear Audio Story   

Essay: Starting Over - 9/18/2008

Here’s something I can’t figure out. Is Ken Cockrel Jr. the luckiest -- or the most unfortunate -- politician in the entire state?

I suspect that’s something that none of us, including acting Mayor Cockrel himself, will know for awhile.  First of all - the good news is that it will be really hard for him  not to look good, coming in following the criminal nightmare of the Kilpatrick administration.

All Mayor Cockrel will have to do to be an improvement is to remember to avoid strippers and  outrageous parties that involve limousines idling in the street for hours. Avoid committing felonies, stealing the people’s money and lying under oath.

Then, tap into the huge reservoir of good will that’s there statewide for someone who wants to make Detroit respected again.

On the other hand, Cockrel is taking the helm of a desperately poor city that has been in a state of economic and political paralysis since the text message scandal broke in January.

He has to try to jump-start Detroit, even as the nation teeters on the edge of what could be the most terrifying financial crisis since the 1930s.  However, that may not be the hardest thing the new mayor has to face. Detroit City Council decided to spend $3 million to hold  special primary and general elections to fill Mayor Kilpatrick’s unexpired term. Yes, the deeply flawed city charter says they are supposed to do that. But this makes no sense.

What it means is that Detroit will have city-wide, mayoral elections in February, May, September and November. Oh yes - and before that, we have the national presidential election in November.

That means that pretty much nothing will happen in Detroit all year long except non-stop campaigning.

Since nobody in the business community, or the wider political community, can be sure who the next mayor will be, nobody is going to be in the mood to make any major commitments.

That is, even if this week’s Wall Street follies leaves any money for anyone to invest anywhere. As for Ken Cockrel. He is now City Council president, the highest vote-getter in Detroit in 2005,

It is entirely possible, if he loses the primary, that he will be a lame duck five months from now, and without any job at all in May.

Those who are betting on who the eventual next mayor of Detroit will be are leaning to former basketball star and businessman Dave Bing. You can be assured that there will lots of candidates, one of whom is likely to be former deputy mayor Freman Hendrix.

Actually, I would like to see a race next fall between Cockrel and Hendrix. Neither is flashy, flamboyant or a spellbinding speaker. But they are both decent, intelligent, middle-class family men.

Hendrix, for example, was the main force in reviving Little League baseball in Detroit.  Both men put themselves through school and had other careers before turning to politics. They are low-key guys who want the best for their community and their city.

Wouldn’t that be a pleasant change?

Hear Audio Story   

Interview: Freman Hendrix - 9/18/2008

At one minute past midnight tonight, Ken Cockrel Junior will become mayor of Detroit. He is replacing Kwame Kilpatrick who will soon be heading to jail. This is the first time in more than fifty years that Detroit has changed mayors in the middle of a term. Freman Hendrix knows something about transitions… he was former Mayor Dennis Archer’s closest aid and later served as his deputy mayor. Michigan Radio’s Jack Lessenberry caught up with Mr. Hendrix, who was at Detroit Metro Airport.

Hear Audio Story   

Essay: Financial Jitters - 9/17/2008

My guess is that - whatever your politics - you don’t think of the U.S government and the Bush Administration as being socialist, right? Well, you would be partly wrong.

They are, indeed, against socialism for the poor. They do not believe in providing health insurance for those without any, or welfare for those who are unable to find work.

Those people need to pull themselves up by their bootstraps, even if they don’t have any boots. But our government does believe strongly in bailouts and handouts for the well-to-do.

Actually, make that welfare for the middle class, and bailouts for the rich. You saw some of that at work this week.

The government stepped in yesterday and spent $85 billion to bail out the troubled insurance mega-firm AIG, which stands for American International Group. Don’t bother checking to see if they are the folks ensuring your condo or your five-year-old Chevy Citation. AIG provides instead, as the New York Times put it this morning “esoteric financial insurance contracts to investors who bought complex debt securities.”

Here’s what that means, for those who still speak English: AIG is insurance for financial speculators. It sells contracts that say it will cover their losses in the event the securities default.

Well, there are billions of risky securities out there. The potential disaster if AIG folded is eerily reminiscent of the stock market crash of 1929, the one that started the Great Depression.

That crash happened when too many people had bought too many stocks “on margin,“ by putting up just a tiny fraction of their price. When panicked sellers called for them to pay up and they couldn’t, the law of gravity took effect. Next stop, the soup kitchen.

So while the government felt it could afford to let Lehman Brothers go the way of the dodo, they felt they had to save AIG.

Just as, two weeks ago, they had to save Fannie Mae and Freddie Mac, the federally chartered mortgage companies.

Had too, because the welfare system depended on it. Columnist George Will long ago noted brilliantly that the biggest form of welfare in this nation is the kind invented for the great American middle class: the mortgage interest tax deduction.

If Lehman Brothers, AIG, Fannie Mae and Freddie Mac had all gone belly up, my guess is that the presidential election polls would now show the Socialist Workers in the lead.

Our domestic automakers want their cut of the welfare state as well. Hemorrhaging money, and having failed to stay competitive, largely through their own stupidity, they want $25 billion in federal loan guarantees. In the next few weeks, we’ll see whether there is enough left in the cookie jar for them.

By the way, the federal government is already running a $400 billion dollar deficit this year, and both presidential candidates are talking about cutting taxes. I don’t have a degree in math, but I can see that these numbers don’t add up.

You know, there are times when the libertarians do have a certain appeal.

Hear Audio Story   

Interview: Charles Ballard - 9/17/2008

The nation’s financial markets have been rocked by three days of turmoil. We’ve now seen major financial institutions closed, sold and bailed out. So, how will this all affect Michigan? Charles Ballard studies the economy for a living. The Michigan State Professor is the author of “Michigan’s Economic Future.” Michigan Radio’s Jack Lessenberry spoke with him.

Hear Audio Story