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Citi Field Chicanery

February 4, 2009 Leave a comment


First let me state a few qualifiers when it comes to the Mets’ now infamous Citi Field. Citi Field is gorgeous. The team that will inhabit it is not as gorgeous. It is outrageous that the taxpayers are backstopping the bank which made the naming deal with the team. It is embarrassing to an organization that has already suffered epic collapses the last two seasons to be going into a new stadium dealing with this kind of headache. With this in mind, let me proceed to the broader controversy regarding the naming deal.

Today in the New York Times, representative Dennis Kucinich argues regarding naming deals that “Treasury has the power under TARP to make broad changes, They have to. It’s not whether they can or should; they have to. The legal issues are very easy to maneuver.” According to Kucinich, Citi Field represents “an egregious example. But we have a list of other banks we’re working our way through. We’ll hold hearings.” I do agree with Kucinich that naming deals such as Citi’s with the Mets represent extravagent, and probably poor expenditures. I don’t know how Citi projected that it would recoup their $400 million investment in the naming rights to the stadium, but investment banks made all sorts of investments far more ridiculous over the last decade to be sure.

Further, given that taxpayers are the ones who are responsible for propping up the company responsible for this deal, it should anger all of us. But what Congress (Mr. Kucinich excluded given his populist rhetoric against the bank bailouts) fails to realize is that were it not for the government’s decision to bail out these institutions, these types of issues would not exist. As Citi unwound its assets during its bankruptcy, the naming rights deal could be nixed and purchased by another company. Where were Kucinich’s angry colleagues when it came to bailing out Citi in the first place?

The outrage amongst politicians when it comes to naming deals not only masks their lack of appreciation that this would not be an issue were it not for propping up failing ventures, but also masks the greater implications of their intervention. Since we all are now shareholders in these institutions, the government will tinker with their management. This begins with caps on executive pay, but who is to say that it will end there?

As poorly as some of these institutions were managed, and granting that a lot of their poor management was due to incentives created by government intervention, I would guarantee that government control of the banks will be even worse. Do you think that Nancy Pelosi knows how to create a DCF model in Excel? Does Barney Frank know how the market for CDO^2’s works, let alone what a CDO^2 is?

Much as I think that President Obama could give a hell of a pitch to investors on the virtues of a closed-end real estate fund, there is no way that the government can ever run these businesses properly. Command economies have always failed. The government lacks the profit motive and the knowledge to successfully manage these companies. Putting the firms under the purview of government represents the greatest moral hazard of them all.

Remember, these are only the direct effects of strict government regulation of the banking sector. There would also be a great effect on the markets. If the government is to have say over the operating activities of the major banks, what kind of implications will this have for retail and institutional investors? Will money flood out to less-regulated private equity and hedge funds? Will those shops then become as regulated as the (remaining) big banks? What kind of confidence will exist in the markets when the biggest broker-dealers are being managed by politicians? Will people not recall what happened to all of the other GSE’s?

There are a plethora of problems with these institutions being managed by the government. The Citi Field naming rights deal is very small relative to the big picture, but it exemplifies the direction the government is going. I am just as angry as everyone else that we are responsible for keeping the Citi naming deal alive, but we must remember that it was because of government intervention that we got ourselves into this mess in the first place. As if it wasn’t bad enough that the Mets aren’t going to pursue Manny Ramirez, now us tortured fans have to deal with this pathetic situation.

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The Significance of 24

January 13, 2009 3 comments


24 has captured the imagination of the American public for the last 8 years, and with good reason. While the plots often border on ridiculous, nevertheless we keep watching, knowing that no matter how death-defying the situation, somehow Jack is going to save (or should I say bail out) the nation. It is refreshing that in this day and age there are still some people that value a good old-fashioned American hero.

In addition to 24‘s always entertaining story lines, the show presents both sides of many political and moral issues. This season of 24 particularly has focused on four themes worthy of examination: protection of our rights from the government, government corruption, intervention in foreign conflicts and political correctness and the issue of torture. While these themes have marked many a 24 season, in particular they pervade the current one, undoubtedly as a reflection of our current political climate. Let us analyze them.

On Protection from the Government

Perhaps the most intriguing aspect of this season has been the reemergence of CTU as a four-person team, fighting to protect the US citizens from the government itself. This is something that should convert liberals and libertarians alike into fans of the show. Our political officials and intelligence agencies have become so corrupted that only four people left in the country have the ability to defend the rights of millions. I have often asked myself the question, “If the government is supposed to protect our life, liberty and property, then who is supposed to protect our life, liberty and property from the government?” I’ll tell you who: Jack Bauer, Bill Buchanan, Tony Almedia and Chloe O’Brien. Though I doubt that Joel Surnow (awesome as he may be) et al really thought this point through, they should be lauded for exposing a fundamental problem with our governmental system, and showing that when threatened by enemies both foreign and domestic, citizens must band together to protect their rights.

On Government Corruption
In the current season of 24, government officials in the President’s inner circle and in the FBI privy to classified information are working for the bad guys – a rogue regime in fictional Sengala, Africa committing mass genocide. While the details are lacking, it seems clear that there are certain kickbacks monetary and perhaps political involved. Could our own government officials ever be working to undermine our nation for self-interested reasons?

While I do not think (and certainly pray) that any of our leaders would sell us out to the point of encouraging terrorist attacks against our citizens, there are ways that leaders more subtly have cultivated ties with our enemies. For starters, take a look at this recent WSJ editorial on Bill and Hillary’s dubious donors. With links to corrupt officials from Nigeria to the Dnieper, needless to say we may want to reconsider Hillary as our Secretary of State. I presume that the Clintons are just one of many political families with ties to less-than-stellar regimes (think of the Bush’s oil ties in the Middle East for example).

This is not to say that these pols are plants for foreign governments working to undermine our state, but we need to recognize that political influence as always has a price that many are willing to pay. Access is king. If someone can pull off a $50 billion Ponzi scheme, is it really impossible to believe that people in our government could subtly or not-so-subtly abet our enemies? I am no conspiracy theorist, but I do believe it pays to always be cynical of our representatives. Moreover, the general concept here of using political clout to receive favors, monetary or otherwise is timely in the wake of Blagojevich, Stevens and Spitzer…and all of political history for that matter.

On Intervention in Foreign Conflicts
The President in the current season finds herself in a bind largely as the result of engaging in foreign entanglements. Trying to act as a liberator of innocent civilians being murdered in Africa, the President prepares to attack Sengala, only to find that the Sengalese have taken control of America’s infrastructure and have the power to strike the nation’s most vital organs. Stand down she is told, and America will go unharmed; invade, and face the consequence of having American blood on her hands.

This scenario is quite prescient as we try to figure out as a nation what our role should be in the world. The predominant view had been that the US as the most powerful nation economically and militarily should serve as the world police, and that promoting democracy throughout the world, sometimes through outright nation-building, was the way to ensure our safety and the freedom and prosperity of others. Obviously, this philosophy needs to be reworked.

I do not view it as the proper role of our government to intervene throughout the world. When it comes to spreading democracy via nation-building, this has never worked well, with the exception of in Japan (a state with a democratic past). As we have seen in Iraq and Gaza, democracy does not ensure freedom or peace, nor do all peoples have the will for these values. While the American government should vocally support the cause of freedom, and not impede the American citizens from supporting the movement for freedom abroad through whatever means they so choose, it behooves the people of other nations to fight for these freedoms if they so desire them. As Mencken proclaims in his Notes on Democracy, “for the loftiest of all the rights of citizen, by the democratic dogma, is that of the franchise, and whoever is not willing to fight for it, even at the cost of his last drop of gore, is surely not likely to exercise it with a proper sense of consecration after getting it.”

This principle goes for trying to defend people suffering from grave injustices as well. I unequivocally stand in opposition to all tyranny and repression. If a people is being massacred, it is incumbent upon those who feel strongly on the matter to defend those people. This does not mean however that it is the job of our government to do so, unless our citizens explicitly request it. Our government’s number one priority is to protect our “life, liberty and property.” To get involved militarily with extraneous conflicts as we have seen on 24 and through practical experience poses a threat to our essential rights. It is the right of the people to defend others, but there should be no mandate on the government to do so.

On Political Correctness
Last year, a representative from Blackwater came to speak at Columbia University. I had the opportunity to ask him about the biggest ongoing challenges facing the defense community, and without pause, he answered that it was political correctness. Given today’s society, it is amazing that we are even able to fight wars anymore. As we see on 24, almost every intelligence decision is made while walking the fine line between balancing delicate political interests and the innate desire to defend our people. In my opinion, this political correctness not only cripples our education and economic systems, but proves most debilitating when it comes to intelligence. Without being able to obtain necessary information, we can kiss goodbye all of the other aspects of society we so cherish because we will be defeated.

Though I did not intend to go into it, this brings up the moral question of torture. Foreshadowing what I would bet we will see here, the season begins with Jack Bauer testifying in front of the Senate about the interrogation methods he used to help foil terrorist attacks in prior seasons. As one might expect, this testimony is pure political theater. The Senator grilling Bauer wants to hear Jack admit to ruthlessly torturing people. This is what the left has been fighting the Bush administration on throughout his tenure, and the objections they raise to torture should be vigorously debated.

To me it all seems very simple: if you believe that someone knows of an imminent, credible threat, torture, be it waterboarding, sleep deprivation or otherwise can be effective, and should be used. Otherwise, for numerous reasons it is best to avoid it. I understand that underlying the issue of torture are questions like its definition, and the guidelines of international law. I am no expert in these areas, nor have I given them sufficient study for my opinion to bare significant weight. But to a man, my humble opinion is that if you think your citizens are in danger, it is necessary for you to use whatever means possible to protect them. Our elected officials have an obligation to our safety first.

Forgetting about these weighty matters however, most of all 24 is entertaining, and should be appreciated by all. Long live Jack Bauer.