Why the Imperfect is the Enemy of the Good

MP3s exemplify “disruptive technology,” a new product initially ignored by major investors due to its low quality yet catches fire due to its convenience. The history of recorded sound has been at the vanguard of the Good Enough Revolution throughout the 20th century: 78 rpm records sounded better than 33s, analog 33s delivered higher fidelity sound than brittle, cold, digital CDs, which make compressed MP3 files sound like dog poop.

People like poop. Wired magazine reported: “Jonathan Berger, a professor of music at Stanford University, recently completed a six-year study of his students. Every year he asked new arrivals in his class to listen to the same musical excerpts played in a variety of digital formats—from standard MP3s to high-fidelity uncompressed files—and rate their preferences. Every year, he reports, more and more students preferred the sound of MP3s, particularly for rock music. They’ve grown accustomed to what Berger calls the percussive sizzle—a.k.a. distortion—found in compressed music. To them, that’s what music is supposed to sound like.” MP3 poop sounds like angels singing. And MP3s don’t scratch, take up room, or get stolen by your roommate.

From the ridiculously portable Flip video camera to streaming video through a laptop to the low-tech Predator drone plane that screws up the best-laid plans of Afghan wedding planners, Good Enough dominates the technology world. Cheap and easy, that’s how we like it.

At least at first glance. Convenience isn’t always, well, convenient. The Flip records videos in a file format that’s hard to manipulate. I have 25 feet of shelf space dedicated to compact discs but I won’t suffer like my friend Mary, whose computer decided to melt down at the same time as her back-up hard drive, taking $15,000 worth of iTunes downloads with them. Print newspapers are hurting, but they can’t be turned off with the flip of a switch as the governments do in China and Iran whenever the Internet masses get rambunctious. And dispensing death from the Predator’s ticky-tacky lawnmower-engine buzz is a surefire prescription for blowback by inspiring the Pakistani jihadis of the future.

In the world of ideas, President Obama has come to symbolize the triumph of Good Enough. (Candidate Obama, he of “hope” and “change,” has been discontinued.) Obama, along with his PR flacks and Congressional allies, loves to paraphrase Voltaire: “Let not the perfect be the enemy of the good.” Better to move forward incrementally than not at all.

Repeatedly ceding ground from the wimpy compromises he made by negotiating against himself, Obama deploys this mantra against anyone who pushes for significant change. “We can’t afford to make perfect the enemy of the absolutely necessary,” said the president after bailing out bankers but not Americans who had lost their jobs and/or homes. Now he’s using the same mantra to tout the toothless, inconsequential mess that came out of the global warming summit in Copenhagen, and a healthcare bill that manages to make the current disaster even worse.

“The general consensus [on healthcare] was that we shouldn’t make the perfect the enemy of the good,” said Senator Evan Bayh, Democrat of Indiana and a key Obama ally.

Unfortunately for us, Obama’s argument relies on a historical example that doesn’t apply today.

Obamaite pundit Jonathan Alter summarizes liberal thinking: “You don’t always get everything you want the first time up at bat,” he argues. “Roosevelt was constantly going back to Congress to strengthen…Social Security, which was not until he had been in office for more than two years. A lot of New Deal types really hated Roosevelt’s Social Security plan because they thought it was so weak. And then later they changed it, and they changed it again, and they changed it again.”

Other Obamaites point to the civil rights legislation of the 1950s and 1960s, which started out weak but wound up strong and meaningful under LBJ. Perfect isn’t achievable now, they argue. But Good Enough is. Get half-assed reforms through on long-standing problems like the economy, climate change and healthcare, they say, and we’ll improve upon them later. But this approach relies on two logical fallacies.

First, Good Enough often turns out to be Even Worse Than Before. Prices of insurance company stocks rose sharply on news that Obamacare was close to passage—an ominous sign for patients. “All in all, relative to the last version of health reform issued by the Senate, things have turned out pretty well for the health insurance industry,” said Carl McDonald, an analyst at Oppenheimer. “In particular, all versions of a government-run health plan have largely been eliminated.” Companies like Sigma and Aetna will be allowed to pass new federal taxes on to their patients, which will include tens of millions of new “customers” forced by the government to sign up—at their own expense. Obamacare will be like a smash to the face for the 20 percent-plus of workers already reeling from many months of unemployment.

Second, looking to the middle of the 20th century doesn’t make sense. Back then historical progress was assumed to be a continuous process. Organized labor, civil rights groups and New Left activists fought hard for movement forward for higher wages and equal rights. They never settled, and they didn’t let Congress settle either.

Our times are different. Although we are clearly entering a period where breakdown, collapse and even revolution could occur, we’re currently stuck with late-period American capitalism and its political leadership. They are stagnant, devoid of dynamism, and alienated from the people. Obama’s half-assed compromises on issues like gays in the military, torture, Guantánamo, healthcare and global warming will be touted as triumphs in the next few elections. Neither Obama nor Congress will view them as building blocks, part of a continuous movement toward historical progress. We will not revisit these debates. They will be over.

Good Enough will always be good enough for Obama. But not for us. Like the kids who’ve been made to believe that MP3s sound OK, we would be better off with nothing at all.

(Ted Rall is the author, with Pablo G. Callejo, of the new graphic memoir “The Year of Loving Dangerously.”)

COPYRIGHT 2009 TED RALL

How to Give America Its Best Christmas Ever

Citibank is suspending foreclosures and evictions for 30 days, until after the holidays.

Mighty white of them.

Who knew bankers could be so amusing? In an interview, Citi mortgage czar Sanjiv Das acknowledged that “moratoriums are not permanent solutions” and said his company was looking for “some long-term fundamental alternatives” to throwing people out of their homes because they’ve fallen behind on their payments. But he didn’t offer a specific example.

Here, allow me. There’s one “long-term fundamental alternative” that’s righteous, makes sense, and legal: Let’s foreclose on the banks. It’s time for the U.S. government to show Mr. Das and his buddies down at the country club who is the boss.

Seriously. Yes we can.

But first, let’s go back to February 2009. Ah, February: a new president, hope and change in the air. Especially for bankers. President Obama’s TARP program doled out hundreds of billions of federal taxdollars to gangster capitalists like Citibank and Bank of America, which get off on charging $4 for using ATMs and 29.99 percent interest in credit cards.

The big banks were supposed to use TARP cash to buy back “toxic assets” backed by home loans to distressed homeowners, thus loosening the mortgage credit market. In fact, The Los Angeles Times reported a few days ago, “The fund has done little to address that problem directly.” Instead, the feds bought bank stock at over-market prices.

In exchange for those bailouts, the banks were expected to free up credit.

They didn’t. They haven’t. Instead, they gave obscene raises to their already overpaid executives. They remodeled their plush offices. Now their loan officers are sitting on their hands, laughing all the way to their own banks.

There’s still money in the U.S. economy. But it’s not moving around—and extreme lack of liquidity is the definition of a Depression with no end in sight. As anyone who runs a small business can attest, the same dirtbag bankers who were lending to anyone and everyone two years ago have suddenly become tightwad tight-asses. Consumers with high credit ratings have seen their credit limits slashed. Banks are even refusing to refinance high-interest home loans at today’s rates, reasoning that lower property values have reduced the value of their collateral—thus ensuring still more foreclosures in 2010.

Because the Obama Administration didn’t pressure them, the banks stonewalled the president’s $75 billion loan modification program, which was supposed to reduce payments for the approximately ten million Americans who face foreclosure. JPMorganChase, for example, blew off or rejected 85 percent of homeowners who asked them for help. That’s better than Citibank, which enrolled 100,000 distressed homeowners in the program but only managed to actually modify loans to 270. And it’s a lot better than Bank of America, bringing up the rear with a pathetic whopping 98 modifications out of the 160,000 borrowers who signed up as of the end of November.

More lowlights:

One out of seven American homeowners will probably lose their homes by the end of 2010.

Only 4.7 percent of distressed homeowners who enrolled in the modification plan have gotten any help.

Out of Obama’s $75 billion program, only $2.3 million has been spent—or 0.03 percent.

Obama’s performance on the foreclosure crisis—along with unemployment, the biggest problem America faces—makes Bush’s laissez faire approach to Hurricane Katrina look caring and loving in comparison. If ever there were a cause for impeachment, look no further.

No doubt recognizing political peril, Obama is now attempting to jawbone the banks into doing the right thing, even calling banking CEOs “fat cats” on “60 Minutes.” Whatever.

“America’s banks received extraordinary assistance from American taxpayers to rebuild their industry,” Obama said after meeting with banking executives. “Now that they’re back on their feet, we expect an extraordinary commitment from them to help rebuild our economy.” But there were no teeth in his demand—just a polite pretty-please with a trillion-dollar-plus bailout on top.

But that’s Obama’s choice. If he wanted, he could foreclose on the banks—and personally give millions of desperate homeowners the best Christmas ever.

Here’s how.

True, the Treasury Department didn’t receive any written assurances from the banks that they would start lending again when they collected their bailout loot back in February. But as Obama recalled in the above quote, it was widely understood at the time that the federal government expected looser credit markets in exchange for the bailout. There were thousands of reports in the media to this effect, hundreds of statements by government officials, and—no doubt—dozens of discussions between government and bank lawyers to this effect. No one was confused. Everyone got it at the time.

Obviously Obama should have gotten it in writing. But the bailout-for-credit quid pro quo was a widely witnessed oral contract. And oral contracts are just as legally binding as written ones.

The classic example of an oral contract is two roommates who agree to share an apartment. The lease may be in the name of one person, but the non-leaseholder may not skip out on the rent. But the stakes can be bigger. Pennzoil made a handshake deal—no contract—to buy Getty Oil in 1984 but then reneged in favor of another suitor, Texaco. Pennzoil sued and won $11.1 billion in damages.

The United States government could, and should, sue Citibank, Bank of America, JPMorganChase and other defaulting miscreants for breach of contract. With one out of seven Americans having been foreclosed upon by one of these institutions, it would be difficult to imagine any jury finding them not guilty. Mercy, after all, wasn’t something these banks showed their victims.

Since damages would likely exceed the defendants’ ability to pay, the U.S. could then seize the banks. The newly nationalized banks, owned by we the people, could reduce or cancel outstanding mortgages to the unemployed, sick and other worthies. They could increase credit lines and start making loans again—you know, do what they promised to do. It wouldn’t necessarily get us out of the Depression. But it would be a beginning.

Foreclose on the banks! It’s fair. It’s smart. And it’s long overdue.

(Ted Rall is the author, with Pablo G. Callejo, of the new graphic memoir “The Year of Loving Dangerously.”)

COPYRIGHT 2009 TED RALL