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Amazon made its reputation as the world’s largest online retailer by making it possible for anyone anywhere to buy consumer products. But has anybody considered what the company itself is capable of buying when it becomes the consumer?

In September 2017, Amazon announced that it was seeking to establish a second headquarters in the United States, where the company would seek to invest $5 billion in the construction of new facilities and which would potentially house as many as 50,000 employees. Called HQ2, Amazon succeeded in soliciting hundreds of offers from city governments across the country, where some have truly crossed the line of ethics in looking out for the best interests of their residents.

Danny Westneat is a columnist at the Seattle Times, who has obtained details of the bids offered by 30 of the 238 cities that have actively solicited Amazon to locate their HQ2 project in their municipalities. That limited sample shows some of the extreme lengths that local politicians have gone, where some City Halls even offering to give the Amazon corporation control over their civic governments.

Most of the HQ2 bids had more traditional sweeteners. Such as Chula Vista, California, which offered to give Amazon 85 acres of land for free (value: $100 million) and to excuse any property taxes on HQ2 for 30 years ($300 million). New Jersey remains the dollar king of the subsidy sweepstakes, having offered Amazon $7 billion to build in Newark.

But more of a bellwether to me are proposals that effectively would put Amazon inside the government.

Some are small. Boston has offered to set up an “Amazon Task Force” of city employees working on the company’s behalf. These would include a workforce coordinator, to help with Amazon’s employment needs, as well as a community- relations official to smooth over Amazon conflicts throughout Boston. (Surely Amazon can handle these things itself?)

But wait, there’s more! And it gets worse….

But the most far-reaching offer is from Fresno, California. That city of half a million isn’t offering any tax breaks. Instead it has a novel plan to give Amazon special authority over how the company’s taxes are spent.

Fresno promises to funnel 85 percent of all taxes and fees generated by Amazon into a special fund. That money would be overseen by a board, half made up of Amazon officers, half from the city. They’re supposed to spend the money on housing, roads and parks in and around Amazon.

The proposal shows a park with a sign: “This park brought to you by Amazon,” with the company’s smiling arrow corporate logo.

“The community fund projects would give Amazon credit for the funding of each project,” the proposal says. “The potential negative impacts from a project would be turned into positives, giving Amazon credit for mitigating it.”

Is it even legal to give a company direct sway over civic spending like that?

It rather makes the deal offered by Chicago, a city whose reputation for extreme corruption is well established, pale by comparison. Here, if Amazon locates its second U.S. headquarters in the Windy City, the company would be allowed to pocket all of the local income taxes that its employees in the city would see taken out of their paychecks.

This kind of dealmaking exposes the practice of offering incentives such as these to attract employers as the scam that it is, where the people most harmed by the practice are those whose “best” interests elected officials have specifically pledged to serve. The money for every goody and perk being offered to appeal to these rent-seeking corporations has to come from somewhere, and since it will not be from either the officially-blessed corporation or the city officials’ own pockets, the burden of paying the bills will instead fall squarely upon the indigent city residents who the rent-giving politicians seeking crony relationships with rich corporations would truly seem to hold in very low esteem.

In far too many ways, the bidding frenzy for Amazon’s HQ2 project parallels the games that billionaire sports team owners have played in getting local governments to pick up the tab for the multi-million dollar stadiums they demand, where the public often finds itself obligated to pay the municipal debts taken out to finance the projects long after the teams have packed up and moved to other cities where more corrupt officials were all-too-willing to get them even sweeter deals at the expense of their citizens.

It’s amazing how extraordinarily generous city officials can be with taxpayer dollars when presented with the public policy equivalent of a get-rich-quick scheme. It’s disturbing to find that some of these officials appear to view the anti-democratic transfer of political power away from the people who live in their communities, as in Fresno, to be a benefit.

For whose interests do the politicians and bureaucrats in these communities really work?

The California Supreme Court has ruled that the state can impose a contract on employers, in the style of Don Corleone, a deal they can’t refuse. News stories hailed the unanimous ruling as a victory for “farmworkers” but it isn’t. The case deals with Gerawan Farming, a fruit grower in Fresno and Madera counties. A full 99 percent of their employees never voted for representation by the United Farm Workers union and many of the workers were not even born 1990 when the UFW contended to represent them. The UFW then disappeared from the scene but Gerawan still payed the highest wages in California agriculture.

Some 20 years later, the UFW had plunged to about 5,000 members, about the same number of workers Gerawan employs. The UFW demanded that Gerawan workers pay 3 percent of their wages to the union or lose their jobs. In 2013, the state Agricultural Labor Relations Board, all political appointees, oversaw an election. The Board then impounded the ballots, set aside the election and imposed a contract. “Nothing in today’s opinion prevents the employees’ ballots from being counted,” Gerawan said in a statement. “We believe that coerced contracts are constitutionally at odds with free choice.” Gerawan will appeal to the U.S. Supreme court but some realities are already evident.

The ALRB’s refusal to release the workers’ ballots from 2013 should come as no surprise in a state that refuses to release voter data to a federal probe of election fraud. Boards of political appointees imposing contracts is more akin to the Soviet collective farm system than a free agricultural and labor market. Only 16 percent of California workers are union members, so unions do not represent “labor” in any meaningful sense. Millennials may not be aware that United Farm Worker icons Cesar Chavez and Dolores Huerta derided migrant workers as “wetbacks” and “illegals” and deployed union goons to attack them.

President Trump has tapped Mick Mulvaney head of the Office of Management and Budget, to run the Consumer Financial Protection Bureau, a bad sign for a number of reasons. As we noted back in 2012 in Financial Crisis and Leviathan, the CFPB was created during the greatest financial crisis since the Great Depression, not a good time to expand government. The CFPB was based on the assumption that even educated and informed consumers were unable to look out for themselves, and duplicated the work of existing bank regulators.

The CFPB is funded by the Federal Reserve, which is obviously improper. The CFPB has no board to oversee its affairs and is not accountable to Congress. Presidential appointee Richard Cordray basically called all the shots. He sought to renovate the CFPB building with a four-story glass staircase, a two-story waterfall, and a sunken garden. Projected costs rose from $55 million to $95 million to $150 million to more than $215 million, an astounding $590 per square foot. By contrast, the Trump World Tower in New York came in at $334 per square foot and the Bellagio Hotel and Casino in Las Vegas at $330. The CFPB is wasteful, unaccountable and redundant, so taxpayers have a right to wonder what it is all about. Some clues have emerged.

Before he resigned last week, Cordray tapped staffer Leandra English to run the CFPB while Cordray, a Democrat, runs for governor of Ohio. So taxpayers could be forgiven for seeing the CFPB as a form of publicly funded preparation for this political move. The CFPB should be eliminated at the first opportunity but Congress can’t seem to get anything undone. If they can’t cut a federal agency as wasteful, unaccountable and redundant as the CFPB, all talk of “draining the swamp” should cease.

Gene Steuerle, a fellow at the Urban Institute who specializes in national debt and tax policy matters, was among 40 notable individuals asked to respond to the question “Has the world been fitted with a debt straightjacket?” by the publishers of The International Economy last spring. His response provided the following gem that summarizes the origins and problems with the United States’ growing national debt in just three short paragraphs:

For most of history, nations with even modest economic growth wore no long-term fiscal straightjacket. Even with the debt levels left at the end of World War II, economic growth led to rising revenues, while most spending grew only through newly legislated programs or features added to programs. Typically existing programs were expected to decline in cost, e.g., as a defense need was met or construction was completed. Until recent decades budget offices did no long-term projection, but if they had, they would have revealed massive future surpluses over time even when a current year revealed an excessive deficit. Year-after-year profligacy was still a danger, but it wasn’t built into what in the U.S. is referred to as “current law.”

Today, rising spending expectations are built into the law through features such as retirement benefits that rise with wages, expectations that health care spending will automatically pay for new innovations, and failure to adjust for declining birth rates and the corresponding hit on spending, employment and revenues. At the same time, officials fail to raise the revenues required to meet, much less fund, those laws or voter expectations.

A rising debt level relative to GDP is merely one symptom. Reduced ability to respond to the next recession or emergency is another, while the increasing share of government spending on consumption and interest crimps programs oriented toward work, investment, saving, human capital formation, and mobility.

The following chart, which is based on data from the Congressional Budget Office’s 2017 Long Term Budget Outlook, illustrates those three short paragraphs.

Summarized into one sentence: U.S. politicians have promised far too much spending in the future than can ever be sustained without causing great harm.

Among U.S. states, Connecticut competes with Illinois for the title of being the most fiscally distressed as a result of the policies its politicians have implemented over the years, where the two states frequently trade off between each other for being in the worst shape.

This fall, both states showed some progress toward resolving their government-caused money problems where Illinois finally passed a budget after more than two years without one, while Connecticut did so after 123 days.

But all is not well. In Connecticut, the state’s politicians have already overspent themselves to the point where new emergency measures must be taken. Keith Phaneuf reports on the story in the CT Mirror:

Gov. Dannel P. Malloy intensified pressure on the legislature Monday to come into special session to repair the new state budget, projecting a $203 million deficit that exceeds a key risk threshold….

The governor, who warned lawmakers last month that he feared the budget they were crafting was not in balance, projected the deficit in his monthly report to Comptroller Kevin P. Lembo.

“The very challenging level of [savings targets] to be achieved in the adopted budget, along with underlying level of appropriations in several agencies … may lead us to increase our deficit projection,” Office of Policy and Management Secretary Ben Barnes, Malloy’s budget chief, warned in the report.

State law requires the governor to prepare a deficit-mitigation plan whenever the comptroller certifies a shortfall exceeds 1 percent of the General Fund. In the context of the new budget, the threshold is $187 million. Lembo’s next report is due Dec. 1.

The state’s politicians were counting on receiving larger reimbursements from the U.S. government for the state’s Medicaid program than they will be getting, and even though they’ve increased the state’s sales tax rates and have repeatedly increased income tax rates in recent years in a bid to fund their even faster growing levels of spending, the state government looks set to collect much less than it hoped to from those sources of revenue.

Meanwhile, despite now having a budget that succeeded in taking the immediate risk of defaulting on the state’s debt off the table and keeping the state’s credit rating from falling to junk status, Illinois is finding itself once again fiscally strained, as the state appears unable to come to terms with all of its unpaid bills. The Associated Press’ John O’Connor reports via Business Insider:

Illinois is chasing a moving target as it tries to dig out of the nation’s worst budget crisis, and a review obtained by The Associated Press shows $7.5 billion worth of unpaid bills — as much as half the total — hadn’t been sent to the official who writes the checks by the end of June.

Although many of those IOUs have since been paid, a similar amount in unprocessed bills has replaced them in the last three months, Comptroller Susana Mendoza’s office said Monday. That’s in addition to $9 billion worth of checks that are at the office but being delayed because the state lacks the money to pay them.

The mound of past-due bills tripled over the two years Republican Gov. Bruce Rauner and Democrats who control the General Assembly were locked in a budget stalemate, which ended in July when lawmakers hiked income taxes over Rauner’s vetoes.

That is despite the state’s large increase in its income taxes. And that doesn’t even factor the cost of dealing with looming Illinois’ pension crisis, where the plans of state politicians to count upon big investment returns to fund the unsustainably generous pensions that they’ve guaranteed to the state government employees who fund their political campaigns are falling so short that they will likely push the state into the equivalent of bankruptcy proceedings without constitutional reforms.

It’s not too late for either state to turn their fiscal situations around, as both have bought themselves time, but it will require a level of real fiscal responsibility and effective spending restraint that both state’s politicians have been unwilling to consider to date. Otherwise, their growing fiscal time bombs will just keep ticking down to their day of reckoning.

Charles Manson has died of natural causes at the age of 83, and those unfamiliar with the fellow should read Helter Skelter: The True Story of the Manson Murders, by Vincent Bugliosi.

In Los Angeles in 1969, Manson plotted a series of savage killings that were not entirely random. By having his followers scrawl “Pigs” on the wall, Manson hoped to throw the blame on militant blacks. As he believed, this would launch a race war in which the blacks would emerge victorious and seek out Manson for guidance on how to rule. If history was going to advance, innocent people would have to die, an idea Manson shared with Stalin, Pol Pot and others. And in a real sense, Manson got away with his deadly crimes.

He was convicted and sentenced to death, but in 1972 the California Supreme Court invalidated the state’s death penalty statute. This commuted the executions of Manson and his accomplices, who got life sentences with eligibility for parole.

Friends and loved ones of the murder victims, who included actress Sharon Tate, can be forgiven for believing that Manson and his gang should have been grandfathered in. Besides injustice, the convicted murderer confirms another reality.

During his long stretch in prison, Manson was hospitalized several times. Unlike injured veterans returning from conflicts abroad, he never had to wait for medical treatment, which was never denied for any reason. Unlike those insured through Covered California, the state’s wholly owned subsidiary of Obamacare, Charles Manson was never dropped from his plan and never saw his premiums skyrocket.

As Manson confirms, with the possible exception of politicians and government employees, convicted murderers get the best health care in the state. That’s not right, but Covered California, a kind of misery index, won’t fix the problem. It would be better to let law-abiding individuals purchase the health care they believe best suits their needs.

That would require a free market in health care, but in Sacramento and Washington that’s not what politicians have in mind.

Since 1995, the U.S. Congress has given the most badly behaving of its members and its employees an unusual, secret taxpayer-funded perk. Writing at The Hill, Jennie Beth Martin explains how a law, the Congressional Accountability Act (CAA), that was meant to compel members of the U.S. Congress to live under the terms of the same laws they impose upon regular Americans into something quite different, especially where the issue of workplace harassment, including sexual harassment, is concerned.

The CAA sought to make changes in how Congress dealt with charges of sexual harassment against its members and staff, too. Prior to enactment of the law, a victim of sexual harassment by a member of Congress had virtually no legal recourse at all. With whom would such a victim lodge a complaint or seek redress?

So the CAA created the “Office of Compliance” to deal with such issues. Complainants begin the dispute resolution process with a mandatory (yes, really) course of counseling that can last up to 30 days. Only after completing the compulsory counseling may a complainant pursue mediation. That, too, can last up to 30 days. If mediation fails to resolve the issue to the complainant’s satisfaction, she or he can then go to an administrative hearing, or file a federal lawsuit.

Here’s the kicker: If the dispute is resolved in favor of the complainant (read: victim), funds for the settlement don’t come out of the offender’s personal bank account, or his or her campaign account. Instead, they come out of a secret account maintained by the Office of Compliance. It is so secret, in fact, that taxpayers don’t even know they are funding it.

The Hill‘s Reid Wilson uncovered how much U.S. taxpayers have been charged to pay for those secret settlements, which we should note cover all cases of workplace harassment that reached that outcome – not just cases involving sexual harassment. The following chart tallies up the cumulative cost for the years for the fiscal years from 1997 through 2017.

In all, over $17.2 million have been paid out over 20 years for some 264 cases, where the average cost of a case for a Congressional bureaucrat behaving badly runs about $65,300.

That $65,300 of shush money for their victims is quite a tax-free perk for those elected members of Congress and other legislative branch bureaucrats confirmed to be behaving badly.

Two days ago, the news recently broke that the nation of Venezuela officially defaulted on its debt. Writing at Forbes, Frances Coppola reports on the straw that broke the camel’s back for what had been one of the richest nations in South America.

Venezuela has defaulted on two of its US dollar-denominated sovereign bond issues. Downgrading Venezuela’s sovereign rating to SD (“selective default”), the ratings agency Standard & Poors said that Venezuela had “failed to make $200 million in coupon payments for its global bonds due 2019 and 2024 within the 30-calendar-day grace period.”

That’s just the tip of the iceberg, as the country is very likely to continue failing to make scheduled payments on its debt when they come due, even with the deal it struck to restructure its debts with Russia and China yesterday.

Coppola reflects on what its default means for Venezuela now.

For long-term Venezuela watchers like me, this default comes as something of a relief. Venezuela’s determination to maintain debt payments despite the horrendous humanitarian cost to its population has been an international scandal. And even more scandalous has been the determination by some investors to profit from Venezuela’s mismanagement of its finances. Because of their very high yields, Venezuela’s “hunger bonds” have been popular with Wall Street giants like JP Morgan. The angry part of me wants all those investors who have profited from Venezuela’s distress to lose their shirts, big time. But the more cynical part of me says the real villain is Maduro, who has sacrificed his people to maintain Venezuela’s international standing….

But there is a much, much bigger problem looming. Figures from the latest IMF World Economic Outlook database reveal that Venezuela is entering hyperinflation. The IMF forecasts that inflation will rise to 2,350% in 2018 and reach an astonishing 4,685% by 2022.

If this is not stopped – and short of regime change, it is hard to see how it can be stopped, since the IMF was shut out over a decade ago and the Venezuelan government does not welcome external interference – then sovereign debt restructuring will be entirely pointless. As Venezuela’s currency collapses, foreign currencies will become infinitely valuable, and therefore unaffordable. Venezuela’s oil production has already fallen so much that it is no longer earning enough US dollars to meet its debt obligations, and with a worthless currency it will be unable to obtain dollars on the open market. Default is therefore inevitable, with or without restructuring.

Venezuela is entering into the final phases of the national debt death spiral. Things are going to get much worse before any real hope of recovery arrives. And that’s saying something for a country where “extreme food rationing” has already become the norm thanks to its failed socialist economics.

The United States Postal Service is reporting losses of $2.7 billion for the past fiscal year, USA Today reports, less than the $5.6 billion from the previous year but still the eleventh straight year the USPS has been a loser for taxpayers. Increases in package delivery failed to offset the drop in regular mail, which fell by, count ‘em, some five billion pieces since more people now use email to pay their bills. The response to losses has been to jack up the price of stamps and seek relief from Congress. As we noted, during years with some of the worst losses, USPS bosses bagged big raises. The massive losses are hardly the only problem for the USPS.

As we noted, the USPS is dropping post offices in retail outlets such as Staples. Consumers found those convenient, but the USPS government employee union doesn’t like them. This forces consumers to use regular post offices, which are like stepping into the eighteenth century. Congress and USPS management have also been unable to implement a simple cost-cutting measure such as ending Saturday mail delivery. So the USPS continues to be a loser for taxpayers.

President Donald Trump says he doesn’t like losers, so he might team with Congress to lift the USPS monopoly on first-class mail and let the USPS compete in that field, as it now does in packages. In the digital age or at any time, stopping the mail monopoly is the only way to end the USPS losing streak and rack up a win for taxpayers.

California government in general, and the state Board of Equalization in particular, are hives of nepotism. That ought not to be the case, particularly in a state with a voter-approved law, Proposition 209, against preferences in state employment, education and contracting. Nobody does anything about favoritism and lately lawmakers have been taking it to a lower level. One woman is charging that state senator Tony Mendoza, Artesia Democrat, made a session at his home a requirement for a job in his office. Senate boss Kevin de Leon says he knew nothing about that, and other accusations against his colleague. Now it turns out that de Leon and Mendoza have been living in the same house in the Natomas area of Sacramento. As it happens, on de Leon’s watch, senate Democrats dished out abuse much worse than any of the charges against Mendoza.

Before he became a California senator, New Left patriarch Tom Hayden championed the Stalinist Vietnamese regime that drove many to flee, including Janet Nguyen, born in Ho Chi Minh City in 1976. She came to the United States legally, even though governor Jerry Brown tried to block the refugees from coming to California. Nguyen duly gained election as a state senator from Orange County. Hayden died in October of 2016 and the senate held a memorial for him in February. De Leon’s chief of staff told Nguyen not to say anything during the proceedings. She spoke up anyway, first in Vietnamese then English. The Democrats cut off her microphone, told her to sit down and be quiet, and when Nguyen refused they had her carted off the senate floor. Senate bosses also cut off the feed from the California Channel, so viewers statewide would not hear an immigrant woman, born in a totalitarian state, speak the truth to power.

De Leon feigned outrage and said he would look into it, but nothing came of it and no senator was punished in any way. Nobody in Sacramento could recall a smackdown and cover-up quite like that. Whatever happened with Tony Mendoza, the worst government abuse takes place right out in the open.