White House Chronicle

News Analysis With a Sense of Humor

Hail to America’s Microbusinesses

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To hear the members of Congress tell it, small business – which exists in a mythical place in America along with mummy and apple pastries – has just two problems: marginal tax rates and government regulation.
 
For most small businesses, these aren't the problems at all. It's the complexity of taxes and regulations that is the problem.
 
To understand the predicament of small business today, one needs to get a grip on what it is. The Small Business Administration defines small businesses as those with 500 or less on the payroll. But to most small businesses, the bar is lower by a factor of about 10. Most owners think they have moved to a different place if they can number their payroll in the dozens.
 
Really small businesses, also more appropriately called microbusinesses, according to the National Association for the Self-Employed (NASE), are those with about 12 employees. These are the businesses that create jobs fast when the economy improves. This is where the rubber of entrepreneurism meets the road of reality.
 
These are Americas real entrepreneurs; these are the people who “go on their own,” preferring self-employment to job security. They aspire to make a living first; making a fortune is a distant second.
 
They may repair cars, make artisan bread, book travel, sell yarn, repair computers, print menus, stage events, publish newsletters, houseclean, landscape, stuff sandwiches, shop for others, manage other peoples’ eBay accounts, test for pollution, paint houses and bird dog the paperwork on import-export.
 
Their governmental enemy is not the rate of taxation, as we were told in the debate that led to the fiscal cliff agreement, but rather the complexity of the tax code. Likewise with regulation, licensing and permitting
 
Keith Hall, who advises the 150,000 member-strong NASE, on tax issues says that microbusinesses are overburdened by the complexity of the tax code and have to spend money they can't afford on accounting fees; or, if they enter into the tax labyrinth themselves, risk making mistakes that can lead to costly audits, and as often as not overlook legitimate deductions.
 
The tax code is a war zone for the single entrepreneur, Hall says. Worse, he says, it favors big business both in the way taxes are calculated and in the deductions allowed. Big companies routinely claim deductions that wouldn't be allowed for microbusinesses: “The playing field is not level,” Hall says.
 
One of the biggest problems centers on health care. The unincorporated entity — say, Jim Smith trading as Gold Limousine — cannot deduct his health insurance. The various forms of incorporation have their own penalties, and all involve time and the need for professional help to administer them.
 
Incorporation is not a panacea for the self-employed. Its primary purpose is to limit liability to the incorporated entity and to facilitate a possible sale of the company, or the taking of equity capital.
 
The distress over the tax code is equaled by employment regulations,environmental mandates and rules about working conditions.
 
But all this is nothing compared to the real enemy of small business: big business.
 
Big businesses, particularly chain retailers and restaurants crush small businesses. They crush them every day. The arrival of Walmart, Home Depot, Target or Staples spells death for dozens of small businesses in the neighborhood.
 
The redevelopment of old neighborhoods, where small businesses flourish, also can be fatal. The local mall is a sanctuary for big retail and a mass grave for small endeavors.
 
The lot of the new business, the small new business, is harder today than it has been historically, as there are fewer fields where the behemoths are not dominant. Also banks lend on formula not character, landlords favor the big and established over the new and enterprising.
 
Yet the urge to be in business continues; the lure is freedom, maybe success and the knowledge that you tried. If you want to see the entrepreneurial spirit at work, visit a decayed strip mall. There you'll find rents that are low and hopes that are high.
 
Of course, you could go to a business school and see the creation of another kind of entrepreneur: the corporate animal learning about business plans, return on equity, takeover strategy and how to get a window office.
 
I say the real entrepreneur is the guy with a fishing boat in Maine, or the single mother with a staffing agency in Oregon. — For the Hearst-New York Times Syndicate

 
 
 
 

Denmark — the Economic Anomaly

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If Europe is being strangled by its social welfare systems, as many in the
United States believe, what is to be made of Denmark? 

Denmark is a social welfare state. It provides free education from kindergarten through university; a free medical system that costs just 9 percent of its gross domestic product, as opposed to the 17 percent that goes to health care in the United States. Women in Denmark get a year of maternity leave; to prevent employers from discriminating against them, men get paternity leave, three months of it.

In addition to this small-weave social net, the Danes, all 5.5 million of
them, are well down the road to a carbon-free future. Currently, windmills generate a whopping 28 percent of Denmark's electricity; by 2020, they will generate 50 percent of the country's electricity. According to Peter Taksoe-Jensen, Danish ambassador to the United States, the plan is for the Danish economy to be carbon-free by around 2050.

As maritime country, Denmark can place much of its wind generation
offshore. Its emphasis on wind power has made it the world's leading exporter of wind turbine technology. A Danish company, Vestas, has three manufacturing sites in the United States that employ 5,000 people. 

In wind farming, size matters; the larger the wind turbine, the cheaper the collection of the electricity, and the more efficient the maintenance. This
is driving the Danes to larger and larger machines. Most onshore wind turbines in the United States are rated a little over 1 megawatt. The Danes have some rated at 6 MW and are contemplating 10-MW monsters far out to sea — where no one except mariners will see them. 

Biomass is also a favorite of the alternative-energy culture in Denmark.
This is a practicality, not a wish. With more than 25 million pigs, manure
is a very available resource for the Danes and they are using it.

Denmark has one of the highest bicycle penetrations in Europe with more than  half of Danes biking to work and everywhere else. In Copenhagen, the principal traffic problem is congestion on the bike paths and bike highways, according to Amb. Taksoe-Jensen. As gasoline costs between  $10 and $12 a gallon, it is not altogether surprising the Danes have learned to love their two-wheelers.

This seeming Green Revolution had its roots not in concern over global
warming, but rather in the Arab oil embargo and the resulting energy crisis of
1973-74. At the time, Denmark was almost entirely dependent on imported oil and other fossil fuels and was very hard hit. Amb. Taksoe-Jensen says the
Danes said to themselves “never again” and set out to become energy
self-sufficient in any way they could with what was at hand. The idea that you could be green as well came later, as a kind of bonus. 

On its journey to a renewable future, Denmark got a leg up from the discovery of oil and gas in the North Sea, which became available in the 1970s. This has now peaked and will be gone in about 20 years. But it has been a valuable transition fuel and currency earner.

Denmark is part of the European Union and NATO. It uses the krone as its currency, which is pegged to the euro.

The economic storms that have been raging over Europe since 2008 have affected Denmark. Global demand for Danish technology and agricultural products has protected Denmark from a severe buffeting. Unemployment which was at 2.5 percent has risen to 6 percent; in most of Europe, unemployment is over 10 percent. 

To this sanguine picture of a future that appears to work, add one more
bonus: for three years straight, polls conducted by the Organization for European Cooperation and Development have ranked the Danes as the happiest people in the world. Last April, a gastropanel crowned Danish restaurant Noma the best in the world for the third year in a row.

For all of this, the Danes pay a price: They have the highest taxes on
Earth and the state is ever-present. — For the Hearst-New York Times Syndicate

Old New England Mills — Where Profit and Beauty Entwined

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PROVIDENCE, R.I. — Across New England they stand as testaments to a time when the United States was a place of untrammeled confidence. The air was infinite, the water clean and abundant. At least for those in the ownership class, life was good and getting better.

They are the great textile mills of New England; magnificent stone and brick structures, in their way as beautiful as basilicas, found along the streams of Rhode Island, Massachusetts and elsewhere.

Water, as a motive power source, drew them to the streams. Then they added steam, hence the mills’ magnificent smokestacks: sentries standing lonely guard over the memories of a more confident time.

Mostly the mills are abandoned now, waiting a new use or the wrecker’s ball. Some have been saved by being converted into residential lofts and art centers. None will again make cloth, or provide thousands of jobs.

Before critics and designers began linking form to function, the mill architects of New England, these designers of castles of production, did so, using great stonework and imaginative engineering. They are stunningly handsome, the way that great bridges are; the spirit of enterprise encased in stone and brick lovingly.

So when and why did we develop a penchant for ugly buildings? Was it the downside of cost accounting? Why are so many modern schools dumpy and deformed? Why must we put our children to study the classics in structures that implicitly deny the classics?

Winston Churchill said, “We shape buildings; thereafter they shape us.” Indubitably.

In the second half of the 20th century, did we hand human aspiration over to cost-cutters, put it through a calculating machine and turn it out bent and spindled? Must we learn to appreciate the economics of urban blight, the strips of chain outlets that presage our arrival in any town or city?

One can weep now over the beauty of a mill in Rhode Island or a grain elevator on a Virginia farm. But will we weep in a century over the golden arches? Shed a tear for the mall? Swallow hard for Public School 19 somewhere?

If the abandoned mills of the Industrial Revolution were just a little older, we would characterize them as archeological sites — perhaps U.N. World Heritage Sites — and assure their survival for generations to come to marvel at.

Of course the history of New England industrialized weaving was not without strife and folly, greed and cruelty.

The loom technology was smuggled out of Britain by industrial espionage, labor conditions wereterrible for much of the life of the mills, and labor unrest continued through all the days of the textile industry. Royal Mills in West Warwick, R.I., for example, the former home of Fruit of the Loom, was the scene of a bitter strike in 1922.

 

Powering yesterday, charming today

 

Incidentally, this giant mill has been preserved. In a stunning piece of imaginative restoration, it has been converted into 250 apartments, keeping the feel and preserving some of the artifacts of the old mill. It is a restoration that deserves global recognition for showing how the 19th century’s relics can find life in the 21st century, just as the restored power plant on the South Bank of the River Thames in London now houses the Tate Modern art gallery.

When old beauty meets new high purpose, something thrilling happens.

The trick in urban architecture is to remember the people who are outside of the buildings as well as inside; those who can glory in the Empire State Building or the Sears Tower by looking up as well as going in.

For this full enjoyment, great architecture needs great public space.

Would the skyscrapers of New York be as glorious without Central Park to view them from? Would the new "Shard," the extraordinary glass-clad building in London, the tallest in Europe, be as great if it could not be viewed from the city’s abundant public spaces?

Yet urban design today, in an age of public austerity, makes no allowance for public space and has come accept the myth that economics are at odds with great city design.

I am comforted to know that the great squares of London, the avenues of Paris and the mills of New England were built for profit. It can be done. – For the Hearst-New York Times Syndicate

Political Lies and Small Business

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Brace for a storm of platitudes, recycled myths, and just old-fashioned
political lies.

It will all start with President Obama when he addresses a joint session
of Congress on Thursday about the jobs deficit. Whatever he says will be
followed by scorn and abuse from the Republicans. All the hoary old claims
about the absence of leadership, wasteful spending, punitive regulation
and the need to cut taxes will be regurgitated.

The president will have a TelePrompTer full of enchantment tales. He also
will talk of cutting some taxes; maybe because he thinks this will endear
him to the undecided voters, or mollify some Republicans, or because he
consistently tries to make his way in a viciously partisan political world
by endeavoring to sound like the voice of detached reason. It will make no
friends and infuriate the Democratic core. It will be another betrayal to
them.

All of the tax ideas, presidential and Republican, will be wrapped in cant
about small business. Oh, do politicians love small business. Apple pie is
good, mom is noble but small business, and small business alone, can cause
the entire Congress of the United States to genuflect.

They love the travel agent with six employees with the same passion that
they adore General Electric. The machine tool repair and maintenance
contractor with 40 employees – he is the very embodiment of American
exceptionalism. The woman with a wholesale jewelry business that she
operates with her husband and grown daughter — they are the stuff of
American legend.

Nonsense.

If Congress knew anything about the small business world, it would
stop forcing the wrong medicine on the patient. Incorrect therapies won’t
help, no matter how vigorous the applications.

To the political establishment, small business is suffering because of
taxation and regulation. Fiddle with these twin bugaboos, the political
narrative goes, and small business will bloom like the bluebells in
spring.

Have any of these people ever talked to small business operators? Small
business has many problems, but taxation is seldom one of them. Do they
really think the garment manufacturers on New York’s 7th Avenue are on the
phone, schmoozing about the rate of corporate taxation? More likely they
are talking about why the banks won’t lend, even against collateral, to
heretofore good customers; why imports from all over Asia are laying waste
to their customer base; and why the traffic in the cross-town streets is
horrendous.

Like all small businessmen, they don’t agonize over the frustration of
having to meet OSHA and EPA standards — these are irritants. Instead,
they agonize over whether there will be enough money to meet payroll.
Taxes, if any, come once a year, but the payroll keeps the small
entrepreneur anxious all year. It is the ogre that visits every two weeks.

To many, government is the problem; but not in the way legislators think.
The problem is the growing shortage of federal and state funds. This
affects many small businesses like builders, excavators, asphalt-layers
and the service industries that owe their survival to small contracts:
social service providers, translators, software writers, and consultants
in just about everything.

If you cut budgets, you cut small business.

Then there is the “chaining” of America. Local diners, hardware stores,
pharmacies and other retailing are crushed, annihilated when the chains
move in. The chains are not inherently evil, but they are manifestly
merciless. Walmart is but one of the chains putting small business to the
sword.

If those who administer government want to know something about small
business, they should spend a weekend at a strip-mall bakery or any other
firm with less than 50 employees. The experience would radically adjust
the rhetoric. It’s too late for Thursday, but don’t believe what you hear.

–For the Hearst-New York Times Syndicate

Political Lies and Small Business

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Brace for a storm of platitudes, recycled myths, and just old-fashioned political lies.

It will all start with President Obama when he addresses a joint session of Congress on Thursday about the jobs deficit. Whatever he says will be followed by scorn and abuse from the Republicans. All the hoary old claims about the absence of leadership, wasteful spending, punitive regulation and the need to cut taxes will be regurgitated.

The president will have a TelePrompTer full of enchantment tales. He also will talk of cutting some taxes; maybe because he thinks this will endear him to the undecided voters, or mollify some Republicans, or because he consistently tries to make his way in a viciously partisan political world by endeavoring to sound like the voice of detached reason. It will make nofriends and infuriate the Democratic core. It will be another betrayal to them.

All of the tax ideas, presidential and Republican, will be wrapped in cant about small business. Oh, do politicians love small business. Apple pie is good, mom is noble but small business, and small business alone, can cause the entire Congress of the United States to genuflect.

They love the travel agent with six employees with the same passion that they adore General Electric. The machine tool repair and maintenance contractor with 40 employees – he is the very embodiment of American exceptionalism. The woman with a wholesale jewelry business that she operates with her husband and grown daughter — they are the stuff of American legend.

Nonsense.

If Congress knew anything about the small business world, it would stop forcing the wrong medicine on the patient. Incorrect therapies won’t help, no matter how vigorous the applications.

To the political establishment, small business is suffering because of taxation and regulation. Fiddle with these twin bugaboos, the political narrative goes, and small business will bloom like the bluebells in spring.

Have any of these people ever talked to small business operators? Small business has many problems, but taxation is seldom one of them. Do they really think the garment manufacturers on New York’s 7th Avenue are on the phone, schmoozing about the rate of corporate taxation? More likely they are talking about why the banks won’t lend, even against collateral, toheretofore good customers; why imports from all over Asia are laying waste to their customer base; and why the traffic in the cross-town streets is horrendous.

Like all small businessmen, they don’t agonize over the frustration of having to meet OSHA and EPA standards — these are irritants. Instead, they agonize over whether there will be enough money to meet payroll. Taxes, if any, come once a year, but the payroll keeps the smallentrepreneur anxious all year. It is the ogre that visits every two weeks.

To many, government is the problem; but not in the way legislators think. The problem is the growing shortage of federal and state funds. This affects many small businesses like builders, excavators, asphalt-layers and the service industries that owe their survival to small contracts:social service providers, translators, software writers, and consultants in just about everything.

If you cut budgets, you cut small business.

Then there is the “chaining” of America. Local diners, hardware stores, pharmacies and other retailing are crushed, annihilated when the chains move in. The chains are not inherently evil, but they are manifestly merciless. Walmart is but one of the chains putting small business to thesword.

If those who administer government want to know something about small business, they should spend a weekend at a strip-mall bakery or any other firm with less than 50 employees. The experience would radically adjust the rhetoric. It’s too late for Thursday, but don’t believe what you hear.

–For the Hearst-New York Times Syndicate

Winds of Change in Washington?

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They are not a gale, not even a stiff breeze — more like a zephyr really — but there are winds of change stirring Washington. There are hints that when Republicans return from their travels and their time with constituents they will be ready for some righting of their ship, which has been listing heavily to starboard.

Over in Democratic circles there are hopes that President Obama, presumably buoyed by the fall of Tripoli, will tighten his grip on the helm and begin to assert himself in ways that his party has felt that he has been missing.

The Associated Press released the results of a new poll on Thursday that showed approval of Congress has dropped to 12 percent, down from 21 percent in June, before the ugly debate over raising the debt ceiling. The Associated Press-GfK poll taken earlier this month also showed that the Tea Party has lost public support, Republican House Speaker John Boehner is increasingly unpopular and that people are warming to the idea of not just cutting spending but also raising taxes, just as both parties prepare for another struggle with deficit reduction.

Stuff happens — and when stuff happens, the political dynamic is changed.

An earthquake and hurricane, for example, has convinced people along the East Coast the cutting the funding for the U.S. Geological Survey, as has been proposed, may not be so prudent. Likewise, the National Oceanic and Atmospheric Administration might need full funding.

Enter states in economic shock. From Maine to California, they are bracing for the impact of federal grants drying up.

At least two Republican governors, who were out in front with austerity programs, are looking less sagacious.

New Jersey Gov. Chris Christie, a Republican Party favorite, sacrificed a long-planned new tunnel into Manhattan on the altar of economic rectitude, just before it was becoming apparent that the only way government can really create jobs is through big infrastructure projects.

Farther south, in a burst of ideological zeal, Florida Gov. Rick Scott waved off federal stimulus funds for high-speed rail and other things. So the funds traveled up the coast to be plowed into road projects in Massachusetts, much to the joy of Democratic Sen. John Kerry who crows about his state's infrastructure progress. The wily presidential hopeful Texas Gov. Rick Perry denounced the stimulus package and then pocketed $14 billion for his state.

The lesson for those who thought that statesmanship lay in placating the well-intentioned but economically challenged Tea Party movement is that surgery with a machete is doomed to terrible results when a laser scalpel is needed.

Malcolm Muggeridge, the great British essayist and popular philosopher, wrote a prescient essay on the failures of reform. Of 12 major reforms, from the Russian Revolution to the ending of Tammany Hall political domination in New York, people who were supposed to benefit were left worse off.

The latter is an issue that Obama may want to ponder as his health care reforms are implemented. Without a public option to benchmark prices, he may have covered more Americans but, in so doing, allowed for prices to further escalate.

It is by the Republicans that the larger pressure for course correction is being felt. "No new taxes," increasingly sounds about as sophisticated as what spectators to the guillotining of French aristocrats chanted, "Off with their heads!"

The public wants government to do many and mysterious things, like invent the Internet, go to Mars, cure cancer, build better highways, and keep us safe at home and abroad. Whether we enunciate it or not, we want the government to look after us in areas of health, world stature, scientific discovery, defense, and food supply and safety. Business does not do those things, and even the most rugged of individualists cannot do them for themselves.

Ergo, we have to pay for those things and the credit card is maxed out.

Tax is back on the table, if not in fashion. Tax and judicious cuts in spending.

Members of Congress also read the poll numbers. At around 13 percent, their approval ratings do not make them feel good. Nobody likes to be told they are an incompetent bum, especially incompetent bums.

So for the first time there is some feeling that the super committee, which is set to tackle the deficit problem, may actually do something before Congress allows mandated cuts — the machete to start hacking.

Just a little more wind, and a grand bargain will be scented on it. Wet a finger and hold it up in September. — For the Hearst-New York Times Syndicate

Perry Peddling the Mythological Texas

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The manner of a man’s arriving is not without consequence. Tom Enders, the
German-born and American-educated head of Airbus, the European aircraft
giant, likes to do it by parachute, if it is an open-air event. People
don’t always remember what he says, but they sure remember how he got
there.

Of Texas Gov. Rick Perry, it could be said that he parachuted into the
race for the Republican presidential nomination. The manner of his entry
will be remembered, as it was meant to be.

Perry orchestrated a drum roll of media speculation, leading up to his
announcement. He assessed, contemplated, debated, discussed, examined,
explored and weighed entry. The media followed: might he, should he, would
he?

The drum roll, fed by leaks, grew louder as the declared candidates
traveled to Iowa for a debate and straw poll. Then Perry, with an
announcement in South Carolina, jumped and precision-landed on the parade
in Iowa.

Poor Michele Bachmann, left like a performing dolphin that has had its
fish snatched away. She had won the straw poll, deserved a few hours of
party adulation and had her joy cut by this man, who dropped in from the
West, all swagger and handshakes.

Perry hit the ground campaigning, when she was hoping to savor a victory
moment or two. Those famed southern manners don’t extend into Texas
politics. Ask fellow Texan, Kay Bailey Hutchison. He crushed her in a
Republican primary in Texas.

In Perry’s political lexicon Texas, and things Texan, are at once policy,
ideology and creed. But Perry’s Texas is not all of Texas, with its
alluring geographical and social diversity. It is the Texas of the
caricature — of barbecue, boots, swagger and can-do. It is not the Texas
of artists in Austin, of the symphony in Houston, ballet in Dallas or jazz
in San Antonio.

It is an inauthentic Texas, minted not on the ranches and the oil rigs,
nor the ugly, sprawling, low-income housing that surrounds the bustling
cities – a testament to an increasing chasm between rich and poor. It is
not the place where schools are failing, the prisons are overflowing, and
the execution rate is the highest in the advanced world.

Perry’s projection of Texas, which he sees as a template for the rest of
the United States, is as inauthentic as tumbleweed — an invasive species
from Russia. Perry’s Texas was created in novels, honed in Hollywood and is
part of the myth that Texas and Texans are imbued with qualities denied to
lesser breeds beyond the Lone Star State.

The problem with believing in myth, and elevating it to the the standing
of principle, is that myth is flexible and can be adjusted to reality.
Ergo the early revelation that Perry is happy to disavow difficult things,
like global warming. He says that there is a list of scientists, growing
almost daily, that say global warming is not the result of human activity.
This is cunning. It disavows responsibility without having to deny the
evidence. While the heads of most advanced governments worry about the
impact of greenhouse gases, a President Perry will not have to.

Perry has also laid down his marker as a man of faith, or at least a man
of public piety. He might want to note that the two most publicly
religious presidents of recent times, Jimmy Carter and George W. Bush,
left office in low esteem and are not faring well in the first books of
history. He may want to ponder why the Founding Fathers were so anxious to
separate church and state.

Perry’s political barbecue sauce, such as berating the Federal Reserve,
may be the precursor to a string of tired, old political nonsenses, like
returning to the gold standard; quitting the United Nations; and
abrogating treaties, in the belief that every commitment abroad is an
infringement of sovereignty.

Perry has made a dramatic entry. Now we wait in trepidation; even George
W. Bush’s people are alarmed. Are we to be shown the real Texas, at the
same time proud and flawed, or the synthetic one, doctored for political
effect? — For the Hearst-New York Times Syndicate

Slash Government Spending? Think again

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From one end of this land to the other, from Anchorage, Alaska, to Key West, Fla., and from Portland, Maine, to Honolulu, you can get a round of applause by stating that the government is too big. Way too big.

But I ask you, in the name of all of those heresies that have proven to be true, is it too big? Maybe we have the government we ordered up, and it is just the size that, subliminally, we want.

The government may be less than efficient, employ too many people at high wages for low output and sometimes be maddeningly illogical. But those things are not a function of size. They are a function of the wrong dynamics in the structure of government, and they won't be cured by clear-cutting the government itself. We need a forester, not a logger.

The fact is that we the people want a lot of government and, whether we like that or not, we keep ordering up more and more. It will be a neat trick to keep it from getting bigger, just because we keep tasking it to do more. Also, we want to be first in all things from space exploration to green energy.

Do we really want the Chinese walking on the Moon, or an Indian spacecraft circling Mars?

Do we really want to buy our green-generating technologies from Norway?

Judson Phillips, founder of the Tea Party Nation, likes to list those government programs that he, with the wisdom of a Renaissance man, finds foolish. But when you add up his examples, even if he were right, they amount to a few billion dollars in a time of trillions.

Mostly, it is programs they do not understand that bring out the conservative axes. I wonder if Phillips would have supported research on the Internet (a crazy idea hardening computers against nuclear attack)?

The big program that is eating our fiscal cake, for anyone to see, is Medicare.  If you are on Medicare, you can list the waste that you are obliged to countenance. We all have stories of unnecessary X-rays, MRIs and multiple blood tests. But is that the only problem?

Suppose we were to cut the cost of Medicare in half?

Wow, that would be saving! Well, we spend between 16 and 17 percent of our gross domestic product on all medicine, including Medicare. In western Europe, that figure is just over 8 percent — some with state systems like Britain, and some with hybrid state and private systems like Germany and Holland.

Maybe, we should overcome our Europhobia and find out how they get the same things for less. If that is too much to swallow, look to Japan: It has excellent medicine for a smaller-yet bite of its GDP.

Social Security, the other great potential budget buster (it hasn't happened yet) is subject to relatively easy fixes. Calculate retirement age on years worked. A college graduate works about 44 years. Extend that.

A carpenter works at least four years longer than a college graduate, but is physically unable to work after age 65. Give him or her credit for the equivalent of time served in the workplace.

Meanwhile, new risks to society demand more government responses — not fewer. Try cybersecurity, ocean pollution, invasive species, illegal immigration, climate change, infrastructure renewal and medical research.

I want to know about new and dangerous mosquitoes carrying tropical diseases that have invaded the United States. I also want bed bugs and stink bugs to be brought under control. And I trust the government has scientists looking into these pesky things.

I also want the government to take diseases like myalgic encephalomyelitis seriously and bring hope to a million suffering Americans, and many millions more around the globe.

We got the government we have because we voted for it piece by piece. Now it is in trouble. When in financial difficulty, cut your expenditures as much as possible — and there are limits here — and then try to get a raise. In government-speak, we call that a tax increase. — For the Hearst-New York Times Syndicate

Murdoch Is Felled by a Disease He Once Cured

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In the 1960s, even to an old union man like myself, British newspaper
unions had reached a point at which they were a threat not only to the
newspaper industry, but also to the freedom of the press itself.

It took someone as ruthless and sociopathic as the unions to find a way to
break their hold. That man was Rupert Murdoch and he did it with
outstanding courage, cheek and military-like planning.

In theory, the deal was simple: If the unions would not behave in the
workplace, he, the proprietor, would move the workplace.

In today’s world, this sounds easy. But in those days, trade union rights
were regarded as inviolable. A blow against one union was a blow against
all unions. “Solidarity,” in union speak, was awesome.

Yet Murdoch set out to leave London’s Fleet Street; then the physical home
of nearly all of Britain’s national papers, now the metaphorical home of
British journalism.

In secret Murdoch built the most modern printing plant of its day in
Wapping, the old dock area in the East End of London. He surrounded it with
razor wire and prison-like defenses and secretly recruited new workers
from the areas of Britain with the highest unemployment.

Nothing so bold had ever happened in British industrial relations.

To get the operation rolling, Murdoch made demands of the National
Graphical Association — the most militant of the unions — on
computerization. The union did not want journalists touching computers,
and they wanted no changes in the antiquated machinery that they used.

Strikes were frequent and often unofficial: The workers just downed tools
over almost always imagined grievances. Then they started censoring the
newspapers: They would not print newspapers with editorial material they
disapproved of. Production was said to be “lost.” This euphemism meant
that the newspapers never appeared in some markets.

If a newspaper were to run a story about communist penetration of the
unions, which was rife, the printers censored it. Sometimes they allowed a
blank space to appear, and sometimes the paper had to withdraw the
offending-but-accurate report to get printed at all.

With planning worthy of a great general, Murdoch orchestrated the move to
Wapping and sprung it on the country as a fait accompli in late January
1986. The journalists, who belonged to a less belligerent union, the
National Union of Journalists, were divided. Some “went to Wapping,”
others quit.

All of Murdoch’s titles moved, including the weekly News of the World, The
Sun, a daily, and the venerable Times and Sunday Times. Five thousand
old-line workers were sacked for honoring what the unions said was a
provoked strike.

But the press was saved, and Murdoch saved it. All the newspapers made it
to fight another day.

The unions had become arrogant, thuggish and sociopathic. They did not
care about the principles of a free press, the illogic of their Luddism or
the greater harm to society. Power and money was their thing, and they had
power: power to boss the bosses, power to set the number of workers who
worked each night, and increasingly power to determine what was printed.

Lord Rothermere, one of Britain’s newspaper barons, was once asked, “How
many people does it take to produce The Daily Mail?” His lordship replied,
“About one quarter.”

The featherbedding was awesome. Some delivery drivers got paid by three
newspapers for delivering papers when they were, in fact, working
somewhere else altogether.

So there is a fine irony that the Murdoch’s News Corp. now stands accused
of many of the sins of the unions he disciplined: sociopathic arrogance; a
desire to control the news as well as cover it; and a thuggish corruption
that reached into the highest levels of at least three British
administrations, Thatcher, Blair and Cameron; and has brought low the
world’s largest and most storied police force, the Metropolitan Police,
known as Scotland Yard.

Murdoch’s many newspapers in England accumulated so much power that they
began to dictate the news, orchestrate policy and politicians came live in
awe of the power of the News Corp. apparatus to reveal people’s private
lives, delve into their finances, and have their careers boosted or
blunted by columnists and selective reporting.

Many years ago, before Murdoch established himself in Fleet Street, one of
its legendary characters, Harry Procter, wrote an angry memoir called
“Street of Shame.” Yes, indeed. — For the Hearst-New York Times Syndicate

Chronic Fatigue Syndrome: Misnamed, Misdiagnosed, Misunderstood

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What's in a name? A great deal, if you suffer from one of the most awful long-term diseases that is widespread: chronic fatigue syndrome.

That name infuriates the patients, maybe 1 million in the United States and 17 million worldwide. It also infuriates the small but dedicated cadre of doctors and researchers who have made the disease and its casualties their concern.

The Centers for Disease Control (CDC) in Atlanta picked the CFS moniker in 1988, although the term myalgic encephalomyelitis (M.E.) is still in use in Europe and elsewhere, and is favored by patients.

The new name fast became despised because “it trivializes the disease and misleads people,” in the words of Leonard Jason, professor of psychology at DePaul University in Chicago. Certainly it brings to mind chronic whiners and everyone's everyday fatigue.

Part of the misleading, as Jason and numerous other medical professionals have claimed, is that the name has allowed governments and psychiatrists, especially in Britain, to sweep a plethora of psychological diagnoses into the tent. This, it is alleged, obscures the central unsolved mystery of CFC and its AIDS-like misery. And it hugely diverts government funding away from serious biomedical research. Jason and his colleagues believe that the most promising lines of investigation — pathogens, including a retrovirus called XMRV — are being under-researched in the process.

Although it has been around for centuries, and variously labeled, the modern concern with the disease dates to a major outbreak at London's Royal Free Hospital in 1955. That outbreak was big enough — nearly 300 — to worry public-health officials.

Its appearance in a cluster at the hospital suggested that it was contagious. Then, as now, there was no treatment and no clue as to the path of the contagion: Was it airborne or food-borne? How about contaminated surfaces? Were bodily fluids involved? Was there a genetic link?

None of those questions have been answered. What is known is that the disease appears in clusters and, more often, in isolated cases. It has spread in families, making it frightening; but the spread is occasional, not automatic.

The next major event to get the attention of health professionals was in Nevada at Incline Village, a resort on Lake Tahoe, in 1985. At over 300 cases, it proved too big to ignore, finally attracting attention from the CDC as well as state public-health authorities.

The CDC sent two young epidemiologists to investigate the outbreak—Gary Holmes and Jon Kaplan. They estimated sufferers at perhaps 20,000 throughout the United States, a majority women of whom were women.

In the same year, a second outbreak occurred in Lyndonville, a farming and manufacturing village in the northwest corner of New York state, with 216 cases out of a population of fewer than 900. Lyndonville only had one doctor, David Bell. He has followed the disease's progress tirelessly, becoming somewhat of a Nelson Mandela in the field.

Over the years, the disease kept on popping up around the country, attracting distinguished researchers in its wake. In 1987, Harvard Medical School professor Dr. Anthony Komaroff published a report about increasingly significant numbers in his Boston practice — the first evidence of what is now a quarter century of his CFS research. Dr. Nancy Klimas, an immunologist and AIDS expert at the University of Miami, found her clinic flooded with sufferers from the new disease and soon found their immune systems showed strange characteristics.

The numbers were clearly overflowing the CDC's estimate, but no one yet realized the extent.

Then entered Jason and his team of researchers at DePaul University. They studied the disease in society from a psychological point of view and found in 1990 that there were about 1 million sufferers in the United States.

They also found that the disease was caused by an unknown pathogen but was not psychological in nature, and that the cure rate was extremely low. Additionally, they and other researchers found that one of the prevailing symptoms was immune system suppression.

For most patients, CFS is a one-way ticket to hell. The affliction is acute and mostly incurable. Horrifically, it takes away even life's littlest pleasures.

According to many interviews and hundreds of e-mails I have received since first covering the disease, sufferers are hit first with symptoms of what seems to be flu. Sometimes there is a short, deceptive remission — sometimes two or three. Then the pattern emerges of collapse after every exertion, especially exercise. Finally, it is full onset: There are no more normal days, only different degrees of weakness, pain and other symptoms. Doctors term the disease relapsing and remitting. That means you might have weeks, months or years of slightly better days, and then stretches — often years, sometimes decades — of almost total helplessness. It is goodbye to the life you have known; to work, to hobbies, to lovers and spouses, to everything short of hope.


Deborah Waroff, a gifted New York author and securities analyst, is typical in the devastation of her life. Before Waroff was a skier, a sailor, a passionate squash and tennis player. Now the aloneness of the disease weighs her down. Very old friends — some from her days at Harvard, a few from childhood, a handful from work — sustain her with telephone calls, when she can answer the phone, and some come by. Nonetheless, the brutal loneliness is always there.

Waroff was first felled at the end of July 1989. Her engagement calendar grew full of forlorn cancellations for dinners, parties and meetings. One day in 1991, a bad headache arrived that lasted three days; after that, it came again and again.

Gradually, with help from a caring doctor, Waroff began to find medications and methods that would allow her to work a few hours a day. Pushing herself with sheer willpower to complete a chore would exaggerate her symptoms — more mixed-up speech, stumbles and almost falls, dizziness, rising fevers. Afterward, she would be immobilized for days.

Then things got worse.

In September 2003, Waroff woke up to find that she was too weak to fill out a simple form — just to renew library books – and fax it. That was the beginning of month after month of near-death incapacity. “I was as weak as you can imagine. I lay on the couch, its high back and sides making me think how much this was like being in a coffin, inert, my consciousness flattened by illness. I was too weak to read and often too weak to watch television. I would turn my back to the screen and let the sound wash over me, not taking it in.”

CFS, like AIDS, suppresses the immune system. Typical symptoms include tremendous fatigue that is unrelieved by sleep, as well as flare-ups of herpes- family diseases (like HHV-6 and Epstein-Barr), swelling of the lymph nodes, muscle ache and other pain, dysphasia (the inability to use the right words) and general cognitive failure, nausea and faintness.


Elisabeth Tova Bailey, once a professional gardener in Maine, was felled by CFS. Unable to leave her bed for more than a year, she filled her days by watching a single snail in a terrarium make its fascinating way though life.

When she was feeling somewhat better, Bailey studied the snail through the wonderful work of the 19th-century naturalists — that special breed of romantics who studied by watching, rather than by dissecting in the lab. The result is the well-reviewed and sweet book, “The Sound of a Wild Snail Eating.”

The most famous person to have CFS, and to have managed in great adversity to be productive, is Laura Hillenbrand who has over time written two incontrovertible bestsellers, “Seabiscuit: An American Legend” and “Unbroken: A World War II Story of Survival.”

Hillenbrand's achievement is Herculean. She seldom is able to leave her home in Washington, D.C. In a recent interview, she told the story of how she had to leave her own wedding because she was so sick.

Statistically two-thirds more women are afflicted than men. But I have heard from a lot of men, including a medical doctor and a young man, who was thrown out by his father who accused him of malingering, being lazy and not wanting to work. His plight is terrible, as is the plight of other people who do not have the intellectual capital or financial resources to do anything but suffer in isolation. Insurance companies drop coverage routinely, and many doctors misdiagnose or are influenced by psychiatric arguments.

Recovery, like that of DePaul's Leonard Jason, is rare. If it does not occur within the first two years, it is unlikely to occur at all. Usually only the young and well-supported socially are able to regain a good part of the health they once had.

The beacon of hope in this wasteland of human wreckage is a private institute in Reno, Nev. Affiliated with the University of Nevada, it is called The Whittemore Peterson Institute for Neuro-Immune Disease (WPI). It was founded and funded by Harvey Whittemore and his wife, Annette. Their 33-year-old daughter, Andrea Whittemore Goad, has been a CFS sufferer since she was 11.

The medical establishment has been cool to WPI; and NIH turned down all six research grant applications it made last year. But 1 million very sick Americans are cheering for this frontal attack on CFS, which they prefer to call M.E./CFS in deference to the older, less trivializing name.

While these things are argued, the life in limbo that so many endure is described by Waroff this way: “You know the trouble with this disease? All this time goes by with nothing in it. You don't get a chance to put anything in it. It's just empty time.”

Squabbling Experts, Suffering Patients

As with other investigative science, the search for a cure for chronic fatigue syndrome (CFS) is riddled with controversy, accusations and suspicion. The patient community believes, with seeming unanimity, that the medical institutions have failed them globally – namely America’s Centers for Disease Control (CDC) and the National Institutes of Health (NIH) and Britain’s National Health Service (NHS) They argue that the CDC discredited the disease, following the first big U.S. outbreak by giving it a misleading new name, chronic fatigue syndrome, and then shirking on research.

Among the alleged perfidy, the CDC first under-counted the number of U.S. sufferers at 20,000 and then over-counted them at 4 million. The count is crucial because when it was too low, resources were starved. And once it was set too high, test results became skewed because the CDC was including legions of clinically depressed people and others with psychological ailments, probably none of whom had CFS.

Nowhere is the counting more important than trying to establish whether it is the retrovirus XMRV that is the guilty pathogen in CFS. If the count is wrong and the patient cohort include people who have been misdiagnosed, the studies become a nonsense.

That is partially the case in Britain, where the NHS has been predisposed to treat CFS as a psychological disease and to dismiss studies which find XMRV in patients as contaminated, in particular by mouse DNA, which is present in the air of many laboratories that use mice in tests.

But the privately funded Whittemore Peterson Institute (WPI) in Reno, Nev. claims that they have never used mice and have guarded carefully against this possibility. Among the numerous test methods they used to thwart contamination, they hunted down antibodies to XMRV in patient blood, which cannot possibly have any connection to contamination. As WPI president Annette Whittemore points out, the real lab work includes finding genuine patients and extracting the elusive markers such as XMRV antibodies, making the work conclusive.

A recent article in the distinguished British medical journal, The Lancet, advocated cognitive therapy for CFS, such as improved diet and regular, paced exercise. The Internet lit up with denunciation. The consensus was that this was therapy for people who suffered from depression, not CFS.

The bottom line: This kind of commonsense therapy may help some, says Dr. David Bell, who has had more hands-on experience with CFS patients than any other medical professional, but it is not a cure or a breakthrough. What little is known is that different therapies work temporarily for different people: Deborah Waroff in New York has had some relief with ozone blood therapy; others, like Andrea Whittemore Goad in Reno, with Ampligen, an experimental drug; and still others with various immune-system boosters.

Those and other issues were debated at a NIH-sponsored conference, entitled “State of the Science,” on April 7-8. — Llewellyn King

This article was previously published by RealClearPolitics.