Obama’s Call to Action: Why We Cannot Wait

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A generation ago in 1961, President John F. Kennedy exhorted the country to take out a new spirit of public service as a new generation took the helm of the United States. Inspired by his call to action, many young Americans would span out across the globe in the Peace Corps and at home came calls for social justice, racial equality, and eventually peace.

In just a few hours today, a new President will take office with as much excitement if not more than that day in 1961. There will be other days to reflect on the pitfalls ahead. There will be other times to reflect on how Camelot and the “Best and the Brightest” to coin the phrase of David Halberstam would end up in the 1960s.

Today we enter a new era with hope and anticipation. We enter a new time where a black President is a reality just as Kennedy ushered in a time when a Catholic President was a reality.

However, there is so much more to the inspiration of President Barack Obama. One of the enduring moments this week, among many which including throngs of well-wishers and supporters gathering in Washington and as notably along his train route, was the image yesterday of the President taking off his coat and painting. Symbolic to be sure, but it was a sign that this President is going to roll up his sleeves and get into the dirty work.

In the midst of all of his excitement was his call to service. He called on people of all ages to give 50 hours to community service a year.

As much as we need a new era of sacrifice by Americans, as much as we need a new call to action, a new call for us to ask what we can do for our country, there is so much more that needs to be done.

For a moment though, contrast this picture with what we saw on September 11, 2001 and the coming days. The country was ready for action. The country was yearning to come together for a national purpose. The country would have heeded any call to sacrifice. One of the big failings of the past administration was the failure to take advantage of that collective moment of unity. Instead it dissolved into polarization. The world was behind us that day and instead we divided it with our ill-considered war against Iraq.

But today I want to talk about the future, not the past. Our communities need Obama’s help. Our communities are struggling. We can start at the State level and work our way down. We cannot afford to wait any longer.

California faces a 40 billion dollar deficit in the coming year. It cannot go into debt. Its legislature is polarized by partisan differences and agendas. Its Governor gained not a single vote in support of his budget proposal from his own party. Workers are facing furloughs, pay cuts, and the very real prospect of the loss of jobs during the toughest economic crisis in recent memory.

We need to take back our state. We need the kind of change at the state level that we have at the federal level and the next election is a distant two years away. We cannot wait.

Banks are failing. Businesses that have long histories are filing for bankruptcy and many are closing their doors. We cannot wait.

Our cities are going bankrupt. Our schools are laying off teachers and cutting classes. Our universities are turning away students. Our counties that are relied on to provide for the least of us, are in the worst shape of all. We cannot wait.

Our local community is probably in better shape than most. Just this past weekend, I was down in San Luis Obispo and read about the schools there facing massive layoffs. Our own district is probably going to avoid that fate the next year and a half. But still we will have to find a way to absorb multimillion dollars of revenue cuts. The children are the future of this nation, they cannot afford to become a victim in the line of cuts. We cannot wait.

The city of Davis, long thought to be immune from economic downturn is facing over one million in deficits by next year and over three million the following year. We can always question decisions made and the reforms needed, but the fact remains, even the city of Davis needs help. Our roads will go unrepaired. Our infrustructure aging. And while a few are prospering, the citizens of this town are in need of help just like everyone else.

But worst of all is the County of Yolo. It is facing an $18 million deficit, that is one-third of its general fund operating budget. The County of Yolo is in charge of providing for the least of us. It is in charge of feeding the hungry, clothing the poor, and giving medicine to the sick and the old. Our county as it stands right now will not be able to carry on its commitments to the needy in our population.

These are tough times indeed. It is great to serve food at a homeless shelter. It is great to volunteer at a hospital. It is wonderful to donate food for the soup kitchen and clothes to thrift shop. But we must do more. For if the county has to cut services, then there will be more hungry, more homeless, more needy, more sick, and less services to help these people. We cannot wait.

So today as Barack Obama gets sworn in let us celebrate, but tomorrow, we must work.

—David M. Greenwald reporting

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About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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27 thoughts on “Obama’s Call to Action: Why We Cannot Wait”

  1. Bushs Last Day...tomorrow, prison.

    I couldn’t agree more. Your assessment of the promise of an Obama Presidency is a marked contrast to the half-hearted ‘endorsement’ of an Obama administration that Rexroad posted. He’ll be good because he has young children? Puh-lease…He’ll be good because he won’t be a Republican with failed ideas.

  2. Anonymous

    Open Letter To Congress On Sharing The Pain President Obama has called for sacrifice and sharing. I wholeheartedly agree.However, before sharing the pain, and before working towards a solution, we must understand the problem. To date, many mistakes have been made because Congress, the Fed, and the previous administration did not attempt to understand the problem and the role everyone played in it.Fed’s RoleThe Greenspan Fed slashed interest rates to 1% in 2002 fueling the biggest housing bubble in history.Furthermore, Greenspan was the biggest cheerleader of derivatives and subprime lending on the planet. Fed Governor Ben Bernanke went along with Greenspan every step of the way. The serial bubble blowing tactics of the Fed that must be eliminated at all costs.It should be clear now that the Fed does not know, and is guessing every step of the way what interest rates should be, and is also guessing what the solution to this mess is.Congressional Role Congress refused to rein in the GSEs and ignored repeated warnings by many to cutoff their lending. Fannie Mae and Freddie Mac were accidents waiting to happen.It simply is not Government’s job to promote housing in the first place. Promotion of housing caused prices to go up (until they crashed) and this is why Congress was always chasing its tail perpetually looking for affordable housing solutions. The very sponsorship of affordable housing programs guarantees that affordable housing will not exist.In addition, Congress threw money at every problem, built bridges to nowhere, and wasting a trillion dollars on a war in Iraq fought on trumped up charges of weapons of mass destruction. All of those things cheapened the US dollar and kicked off a commodities bubble that has also crashed.State Legislatures RoleState legislatures are also to blame. 44 states now have large budget deficits. California in particular is a basket case. States believed the housing party would last forever and failed to fund pension plans while squandering money on all kinds of irresponsible pet projects. Property taxes rose to and remain at unsustainable heights. States are now running out of money to fund all the projects and benefits they have promised.My biggest fear right now is Congress will throw money at the states, without requiring them to make the sacrifices that need to be made. Spending must be cut, programs must be cut, benefits must be slashed, and pensions must be capped.I ask that not one cent of Federal (taxpayer) money go to any state that does not make the necessary sacrifices. Part of that sacrifice must be a reduction in pay by the Governor and legislature of every state.I commend Ohio Governor Ted Strickland for having the courage to ask for across the board union pay cuts. That is a start, but it is only a start.Pension PlansPension plans are a particularly sore point for many citizens. Promises have been made to unions that cannot be kept. Such promises caused the bankruptcy of the city of Vallejo, California. Other cities are sure to follow.Wages and pension benefits of all government employees needs to be brought inline with wages and benefits in the private sector. There is no other way out. Pension benefits must be capped for all new state and federal hires. Taxpayers should not have to bear the pain for funding massive benefits for government employees when they have no such opportunities for themselves.Fractional Reserve LendingUnquestionably bank greed came into play. Massive leverage and off the book SIVs by Citigroup and others certainly played a role. However, it is important to understand the Fed’s role as an enabler.The culprit in this case is fractional reserve lending. This fraudulent policy, sponsored by the Fed, allows more credit to be extended than there is base money supply. This was the enabler that allowed banks to lend and securitize over and over and over again, recording fake profits every step of the way.Over time, asset bubble form such as the bubble in housing. To keep the bubble going, the Fed printed more and more money, and banks extend more and more credit. As with every credit bubble, there eventually there comes a day reckoning when what has been lent out, cannot possibly be paid back. That day of reckoning is now.In simple terms the Fed is a sponsor of the world’s biggest Ponzi scheme. The scheme has now blown sky high, as money to keep the bubble growing simply ran out. That is why 10 new Fed programs have failed to produce any results.Unless and until fractional reserve lending is eliminated, these kinds of problems will reappear. I ask Congress to disallow fractional reserve lending. It cannot be done at once, but it can be phased in over time. It will be a painful process but banks must share in the pain for their role in the mess.Role of the SEC Many blame the rating agencies for the ridiculous AAA ratings on mortgage backed securities. The rating agencies deserve criticism, but one must take the problem back to the root source. It was SEC sponsorship of the rating agencies that actually created the problem.The origin of the rating game mess dates back to 1975 with the establishment of the Nationally Recognized Statistical Rating Organization (NRSRO) by the SEC.NRSRO turned upside down the model of who had to pay. Previously debt buyers would go to the ratings companies to know what they were buying. In the revised model, the issuers of debt had to pay to get it rated or they couldn’t sell it. Not only that, but they have to be rated by one of the rating agencies approved by the SEC.This led to shopping around to see who would give the debt the highest rating. In the new model, the rating agencies got paid by the quantity of the work they did rather than the quality of the work they did.Now there are calls for regulation and oversight of the ratings agencies. However, the simple and correct solution to this problem is to eliminate government sponsorship of the rating agencies returning to the model where the rating agencies get paid by the quality of their work rather than the quantity of it. I guarantee this solution will work.Why Banks Aren’t Lending Money was given to banks and many members of Congress are asking for banks to increase lending. I suggest that instead of attempting to force banks to lend, that Congress seek reasons why banks are not lending. Here is the answer.1. Banks are still insolvent after all those capital injections. There is simply no capital to lend. Book values of banks, if credit were to realistically be marked to market is negative.2. There is no reason to lend. What do we need more of? Cars? Pizza Huts? Houses? Nail Salons? Malls? Furniture? What? Nothing is what. There is no consumer demand because there are no jobs.It is a serious, serious mistake to force banks to lend at this point. All it will do is increase bank writeoffs.A Word About JobsIn spite of what Krugman and other economists say, Government cannot really …create… any jobs per se. It can raise taxes and shift private sector jobs creation to government jobs (typically a malinvestment), and it can bring production and consumption forward for those jobs that are genuinely needed (filling potholes and repairing bridges), but once the potholes are filled and the bridges repaired, one has to ask the question, …What will we do for an encore?…There is no free lunch. It is impossible to spend one’s way out of a hole. It cannot be done and should not be tried. Japan proved it. So did FDR. Ultimately it was World War II and the destruction of much of the world’s productive capacity that ended the great depression. The US was relatively untouched by the war, and could lead a worldwide recovery.That said, there is a genuine need to repair infrastructure and that need must be done at the cheapest possible price.I Urge Congress To Scrap Davis BaconWhen it comes to jobs creation, we need to get the most work done for the cheapest amount. The way to do that is to scrap the Davis-Bacon act. Economist Greg Mankiw writes:…More public projects would pass a cost-benefit test if we repealed the Davis-Bacon Act. This law requires contractors on these public projects to pay …prevailing wages,… which are typically union wages well in excess of what would occur in a free market. If the government paid market-determined wages for infrastructure projects, we could have both more infrastructure and less government debt. Without doubt, that legacy would benefit future generations….Where’s The Apology?Now that the bubble has burst there has not been one peep from Bernanke for his role in the mess. Nor has there been an apology from Barney Frank or anyone in Congress for their role in this mess.What about an apology from governors and state legislatures for their role in the mess. How about an apology from the SEC?Instead we are told we must share the pain. Here is a synopsis of the plan to date.Sharing The Pain PlanOrdinary Taxpayers 100%Banks 0%Congress 0%State Legislatures 0%Bernanke 0%Fed Governors 0%Fannie Mae Bondholders 0%Freddie Mac Bondholders 0%FDIC executives 0%SEC 0%Is it any wonder the average person is up in arms over the bailouts. When does Congress share the pain? When do bank executives share the pain? When does Shelia Bair share the pain? When does Paulson share the Pain? When does Bernanke share the pain?Bernanke, Barney Frank, and anyone else in Congress who supported Fannie and Freddie owe US taxpayers a huge apology. They should share in the pain.Healing cannot begin until those responsible for the mess own up to their part in it. Instead, Congress is turning to Bernanke for answers when he failed to see the problem. If Bernanke could not see the problem, how can he possibly see the solution?Bernanke failed to see this coming, denied it every step of the way, then threw 10 new programs at the credit crunch, all of which failed.I call for Congress to share the pain by cutting their own salaries.I call for Congress to not give one cent to the states unless they do the same.I call for a reduction in salaries at the FDIC, the SEC, and every Federal department.I call for a reduction in salaries at the Fed.I call for a reduction in salaries in state and local governments.I call for capping of pension plans everywhere in government.I call for Congress to revoke Davis-Bacon.I call for the end of SEC sponsorship of the rating agencies.I call for union concessions from the auto makers.I call for executives and all employees of banks and brokerages receiving money to share the pain.I call for an apology from all who contributed to this mess, including Bank and Brokerage executives.Most of all, I call for the resignation of Fed Chairman Ben Bernanke, the abolishment of fractional reserve lending, and the end of the Fed itself, the latter to be phased out over an appropriate period of time.http://globaleconomicanalysis.blogspot.comMike …Mish… Shedlock

  3. Anonymous

    Wow… who could possibly follow that up? Ok, I will.er…uh… Only where’s the role of the common man… I think that’s where we started here. There is a role for each of us as well. It’s not all about the …big system…, annoymous, generalised …them…. It’s not always …those guys… or …you people….Where we started here is the bit about individual choices?

  4. Trying to Survive

    Seems to me it is easy for Obama to say that somehow the public needs to …volunteer… their time, as CEO’s walk away from failing companies with $500 million in golden parachute packages. The Univesity whines it does not have enough funding, as it builds a new stadium, the local Davis school district tells us the …sky is falling… as it gives a raise to its budget officer. If gov’t itself can’t walk the walk, then don’t talk to us about what we should do! The taxpayer is just barely making it, many will be without jobs, and we’re told we have to do something?I agree with much of what the previous commenter says in the …Open Letter to Congress on Sharing the Pain…. …Sharing the Pain… is nothing more than a euphamism for gov’t ducking responsibility for its own culpability, and its own unwillingness to grapple with the difficult problems and choices that should now be made. Real reform is needed in our methods of governance.Where is the SEC, in stopping the practice of CEO’s looting a company as it goes under? Where is the gov’t in calling a halt to Universities increasing student fees while the University pours money into pet projects that will not benefit the majority of students and is often not related to academics? Where are the local School Boards in making sure every dollar is well spent, instead of going to the taxpayer for more money every time they make a fiscal blunder?The taxpayer is getting robbed blind, w no recourse to close their pocketbooks, bc of out of control gov’t and its wasteful spending and inability to regulate. Obama had better get a clue fast, because calls to …share the pain…, $40 a month rebates, calls to …volunteer… are not going to cut it in this stalled economy. Only true reform of our institutions, no matter how painful, is a way out of this morass we have become mired in.It is also easy to blame everything on Bush or the War in Iraq. It is not Bush or the War in Iraq that caused the mortgage meltdown. The mortgage meltdown was caused by multiple administrations asleep at the switch. Greenspan played a huge part in it, Bernanke ignored the problem at his peril, Frank and Dodd pushed subprime loans to low income folks at the country’s peril. Banks pushed bad loans off onto unknowing investors. Now who ends up getting bailed out? The homeowner who was the victim of predatory lending? No, the very banking institutions that perpetrated the fraud. Color me fed up, disgusted, and not about to …volunteer… my time! I’m going to have trouble surviving!

  5. Anonymous

    In the midst of all of his excitement was his call to service. He called on people of all ages to give 50 hours to community service a year.This kind of annoys me. People who volunteer already are doing a great job with this. People who don’t want to volunteer aren’t going to suddenly start doing it because Obama said so. People who are trying to struggle through this recession are going to be busy working! Who is it that Obama thinks has all the time in the world to be fixing our community? I thought he was going to fix everything himself anyway.I do think we need to elect better people to Congress to prevent some of this madness from happening again.

  6. Anonymous

    Yesterday was a holiday for many people though. So they had time. Is everyone going to keep up this 50 hours of community service when the confetti is cleaned up and we all have to go back to work? We’ll see.

  7. David M. Greenwald

    Well I guess we’ll find out. Someone older than me can tell us how the country viewed the notion of the Peace Corps and national service that Kennedy issued a call to arms for.

  8. Anonymous

    I think we need to change the day of the inauguration. January 20 holds no special significance.We already celebrate MLK day the third Monday in Jaunuary. Why not hold the inauguration on that day, too?A lot of us had yesterday off from work. Far fewer could be home today to watch the inauguration ceremonies live on TV. It won’t harm the MLK celebration to combine it with inauguration day once every four years.

  9. David M. Greenwald

    It would have worked this time given the nature of the election, but normally probably a lot of people would have objected to sharing MLK day with Reagan, Bush, etc.

  10. Anonymous

    The inauguration, whoever the president is (Reagan signed into law the King holiday, by the way), is an historic event. It should be something that you don’t have to take the day off of work to see or attend.Except when it happens to fall on a Saturday, it’s hard for children in school or people who have regular M-F jobs to watch it. I know when the 20th falls on a Sunday, they move it to Monday. That’s fine, if that happens to be MLK day. Otherwise, it’s always held on a school day.I am not saying it has to be on MLK day. What I would prefer is it is held on a day that most people can watch it live on TV. If people don’t like combining it with the King holiday, make the inauguration the third Saturday in January.

  11. Anonymous

    …January 20 holds no special significance….The 20th Amendment states the job starts on January 20th. You have to do it on the day the job starts.I hope most school children did watch it in their class rooms.

  12. Anonymous

    The 20th Amendment states the job starts on January 20th. You have to do it on the day the job starts.This is not correct. You don’t have to have the inauguration ceremony on the 20th, even if you don’t amend the Constitution.In 1985, January 20th fell on a Sunday. Reagan privately took the oath of office from the Chief Justice on Saturday, January 19th, and the public inaugural ceremony was held on Monday, January 21st.If we want to, we can hold the inaugural ceremony every four years on the third Saturday in January, while the official swearing in can take place as prescribed by the 20th amendment:The terms of the President and Vice President shall end at noon on the 20th day of January, and the terms of Senators and Representatives at noon on the 3d day of January, of the years in which such terms would have ended if this article had not been ratified; and the terms of their successors shall then begin.

  13. Anonymous

    In 1957, January 20th was also on a Sunday. Ike took the oath of office that day, but the inauguration ceremony was held the next day, Monday the 21st.In 2013, when Sarah Palin becomes president, January 20th falls on a Sunday, the third time since the 20th Amendment was passed. Even if she becomes president on January 20th, 2013, her inauguration won’t be held that day.

  14. Anonymous

    David M. Greenwald said… It would have worked this time given the nature of the election, but normally probably a lot of people would have objected to sharing MLK day with Reagan, Bush, etc. Who’s a lot of people? How did you reach this conclusion? Were you still in diapers when Reagan was elected? Why would it have worked this time? Are you saying that …a lot of people see race and not human beings? Think, before you make unjustified statements.

  15. Chester

    … He called on people of all ages to give 50 hours to community service a year……I’m sorry – other than this statement making me feel warm and fuzzy inside – I don’t get why rational people are inspired by it.50 hours of community service doing what, or instead of what? If I have 50 hours to devote to growing a business to employ more people, is that not a better use of my time? If I have children, should I give up 50 hours of time I would otherwise have with them to provide community service, or is 50 extra hour of extra time with my kids a better community service? If I am a public-sector employee, should I spend another 50hours to elminate a backlog of customer requests, or go paint a house… which provides the better public service/value?Helping others is a fundamental moral sensibility passed down from traditional institutions that teach morality. The primary of these are parents and churches. I find it ironic that many of the children of church-rejecting, anything-goes, me-first baby boomers are excited about this concept like it is the first time they have heard it.Personally, I do not need my President preaching morality to me. I do not need him to inspire me to do everything I can to serve the communities in which I live. That fact that so many are inspired by his words is a testament to how far we have sunk with respect to having a moral compass. Travel the US as I do and you will notice something profound in the average human behavior in the red and blue states. The blue states

  16. Chester

    … Where there is suffering, there is duty. Americans in need are not strangers, they are citizens, not problems, but priorities. And all of us are diminished when any are hopeless. 31 Government has great responsibilities for public safety and public health, for civil rights and common schools. Yet compassion is the work of a nation, not just a government. 32 And some needs and hurts are so deep they will only respond to a mentor

  17. wdf

    Eloquently? Funny, I also went back and read Bush’s first inaugural address. This is clearly a matter of opinion. I find Bush’s text a bit over the top with eloquence — like …guilding the lilly…. For instance, …And an angel still rides in the whirlwind and directs this storm… is a little too fluffy for my tastes; doesn’t do anything for me in a persuasive or inspirational sense.Obama’s text read a little closer to conversational. I also prefered the way Obama expressed the need for involvement of everybody — that past generations have brought us to this point, what do we want future generations to think of us at this moment. I would be curious to know how much input each had in crafting their speaches. But between Obama and Bush, Obama’s delivery was far better. My opinion, obviously.

  18. wdf

    Interesting that Obama’s inclusive references to faith (or …non-faith…) were a big problem for some. …For we know that our patchwork heritage is a strength, not a weakness. We are a nation of Christians and Muslims, Jews, and Hindus – and nonbelievers….See link.Probably overblown in reporting the flap, but interesting that it’s even an issue, given that it’s a fact that there are significant populations of Hindus, Muslims, and nonbelievers in the U.S.

  19. chester

    ……between Obama and Bush, Obama’s delivery was far better…I agree, but many illustrious and venerated Presidents of the past were less impressive with personal oratory stills than with their thoughts and beliefs as conveyed in written form. Lincoln

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