October 29, 2009
At the New Economy Conference, Leo Gerard of the United Steelworkers just said that deregulating Wall Street was like leaving a 3 year old in a candy store unsupervised for a day. When you come back the kid is stuffed full of candy, candy falling out of the pockets -- but when you are driving home the kid pukes on your shoes. It's time to stop Wall Street from puking on our shoes.
I am in DC at the Building The New Economy conference. There is a Listen Live button at that site, so you can attend as well. My computer clock says 5:40am as I type this so California readers are discovering this half way through the conference. :-0
Yesterday I attended a blogger roundtable with Rich Trumka, President of the AFL-CIO. I'll write about this later.
Gov. Ed Rendell, Commonwealth of Pennsylvania
Sen. Sherrod Brown, D-Ohio
Rep. Rosa DeLauro, D-Conn.
Rich Trumka, President, AFL-CIO
Leo Gerard, President, United Steelworkers
Prof. Suzanne Berger, director of the MIT International Science and Technology Initiatives
Jeff Madrick, author, "The Case For Big Government"
Robert Kuttner, author, "The Squandering Of America"
Kate Gordon, Apollo Alliance
Conference agenda (times are EST):
LESSONS OF THE FALL
9:30 a.m. There Is No Way Back: A New Strategy is Essential
BUILDING THE NEW ECONOMY
10:10 a.m. A New Foundation: Strategic Public Investment
11 a.m. Making It In America: Manufacturing in a Global Economy
12:05 p.m. Luncheon Keynote: Towards a New Economic Strategy
1:30 p.m. Global Challenge: A Sustainable Balance for Growth
2:30 p.m. Getting There: The Next Steps
October 26, 2009
October 25, 2009
Bill Scher interviews me on Building The New Economy:
October 24, 2009
So I updated to win 7 last night. It took almost 5 hours.
Partway through it stops on something like "checking files 21%..." It just stuck there, so I started checking online, and people were saying it does that and to just wait. So I waited and AFTER AN HOUR it started going again.
It "does that," but Microsoft doesn't TELL YOU it does that.
Finally installed but everything seems really slow now. Firefox does its "not responding" tihng and goes dim every few minutes. This is a modern computer with a fast processor and plenty of ram.
So after I get it all upgraded it turns out that the anti-virus/backup program I use doesn't work - AND IT'S FROM MICROSOFT!!! It's called Windows Live OneCare. Microsoft doesn't TELL me that this program that I pay a yearly fee for and have a bunch of time left on isn't going to work with their own new operating system.
Here is the worst part - that program is what I used to make backups, and only OneCare can read the backups it makes, so my only backups depended on it working. I can't access the backups any other way, and I can't install the program under Windows 7. I haven't lost anything, but I had to start making a new backup from scratch today because I am going on a trip tomorrow and do not want to travel without a backup.
So get this -- the Windows 7 backup program has been running SINCE 8 AM and it is going on 3 now. And it isn't even halfway done yet!
It looks as though the Windows 7 upgrade is going to take more than 24 hours. And THEN I'll know what is working or not.
Microsoft has a complete monopoly granted by the Bush Justice Department AFTER they lost the anti-trust court case. Remember that? They gave a bunch of money to the Republicans and their think tanks etc., and got let off from all consequences AFTER being convicted? And that is why so many people have to use Windows and Office. Bill Gates still the richest person in the world?
Yes, I know about Mac's I had one of the first Mac software companies. But I have a zillion dollars of software and would have to replace all of it after paying the Apple tax which is about 3x the cost of a comparable PC. But it is looking like I am going to have to switch to Mac.
Update - Total time for updating and several attempts that led to finally getting a good backup made was about 28 hours. I'm on my trip.
So... I said it's looking like time to get a Mac... Well my wife forgot her MacBook Pro power cord so we had to stop at a Mac store and get a new one. $80!!! The Mac tax.
Should I pay the Mac tax and get a Mac or stick with PC?
October 23, 2009
Who do the words "moderate" and "centrist" always and only apply to those who take the position of the largest corporations against the interests of and positions held by most people?
These words are a linguistic seizing of the high ground, rather like the use of the word "protectionist" as a pejorative.
The other day I wrote about how the dollar is falling - but not against the Chinese Yuan. A falling, or "weak" dollar is great for American manufacturers, and therefore American jobs, because it makes American goods cost less everywhere else. This means our exports should rise, reducing our trade deficit and helping us pay off the huge amounts decades of conservative budget policies forced us to borrow from other countries.
Conservatives, though, are trying to use the complexities of the relative value of the dollar in currency markets as an anti-Obama political issue. They must have polling that shows people reacting to way the words "strong" and "weak" are used. This misunderstanding of "strong" and "weak" reminds me of how I used to be confused by "debit" and "credit" when I learned double-entry accounting. (Sorry, I probably shouldn't mix corporate finance humor with blog posts.)
For example, earlier this month Sarah Palin (or someone) wrote on her Facebook page that a falling dollar makes us "vulnerable." This is a brilliant play on the "weak" theme, and is used to further scare people. (Republicans like to scare people - remember how Iraq was going to spread smallpox?) She earns her Exxon check, writing that we need to "Drill, baby, drill" for energy independence to solve this. She writes nothing about conservation, alternative energy sources like wind or solar, or about smart grids, or developing a 21st century economy -- Exxon wouldn't like that.
Palin's ghostwriter confuses several issues at the same time. This is brilliant agitprop but terrible, terrible policy.
Paul Krugman, America's other master economist, writes in the NY Times today that the problem is China, not Obama. China "pegs" their currency to the dollar so when the dollar drops the Yuan drops along with it. This keeps goods made in China at a nice, low price relative to everyone else, reducing any advantage we might gain from market forces. Krugman writes,
If supply and demand had been allowed to prevail, the value of China’s currency would have risen sharply. But Chinese authorities didn’t let it rise. They kept it down by selling vast quantities of the currency, acquiring in return an enormous hoard of foreign assets, mostly in dollars, currently worth about $2.1 trillion.
Many economists, myself included, believe that China’s asset-buying spree helped inflate the housing bubble, setting the stage for the global financial crisis. But China’s insistence on keeping the yuan/dollar rate fixed, even when the dollar declines, may be doing even more harm now.
Krugman says it is no time to be timid. We have to confront China on this manipulation.
The thing is, right now this caution makes little sense. Suppose the Chinese were to do what Wall Street and Washington seem to fear and start selling some of their dollar hoard. Under current conditions, this would actually help the U.S. economy by making our exports more competitive.
A a Bloomberg today story demonstrates why we need to bring the dollar down relative to the Yuan,
“The stable yuan helped us increase sales by about 20 percent this year,” Cody Hu, a sales manager at the Yongkang- based company, said at the China Sourcing Fair in Hong Kong.I'm with Paul, not Palin. A lower dollar means JOBS.
. . . “Competitors in China are doing good,” said Suresh Sranavasan, a distribution manager at the company. “They have pricing advantages from the government’s stable yuan policy.”
Take a look at the agenda for the Building the New Economy conference, Thursday, October 29, 2009 -- 9:30 a.m.-3:30 p.m. at the Washington Court Hotel in Washington, D.C.
This conference sounds the call for the new economy we must build out of the ruins of the old. It focuses on the need for a new agenda to revive manufacturing in America. It's free. But you have to RSVP.
October 22, 2009
Creigh Deeds is a Democrat running for Governor in Virginia. In a debate last night he told Democrats not to vote.
Here's the story: Deeds: 'I Would Consider Opting Out' Of A Public Option,
At the final debate of race last night, Virginia Democratic gubernatorial nominee Creigh Deeds said he "shared the broad goals" of health care reform, but would "certainly consider opting out" of a public option "if that were available to Virginia."
"I'm not afraid of going against my fellow Democrats when they're wrong," Deeds said. "A public option isn't required in my view."
Wow, if I was in Virginia I'd be far away from the polls on election day.
When you comb the serious academic evidence about how and why economies grow, you will find that no case can be made that big government or even high taxes impede economic growth over time. History offers no lesson about the values of minimal government. There has never been a laissez-faire modern economy. To the contrary, the evidence shows that government typically contributed vitally to growth. As odd as it is to have to say this, without effective government, America would be poor today.
The lost faith in government has detrimentally affected almost all aspects of life in America in the last generation: health care, education, retirement security, the quality and durability of jobs, family time available to raise children, rising prison populations, and the nation's wealth itself.
"There is absolutely no interest, no reason Republicans should ever vote for this thing. They have gone from a party that got killed 11 months ago to a party that is rising today. And they are rising up on the turmoil of health care,"
Just look at this, Family Trusts Lobby to Avoid New Rules
Wealthy Americans who operate family investment funds have launched a lobbying campaign to escape new rules being weighed by Congress aimed at more tightly regulating private investment groups.1000 family accounts, half of which have at least $1 billion in them. They want to be exempt from rules so they hire friends of Sens Biden and Kennedy, who are then paid $60K a month -- to do what?
... World-wide, there are about 1,000 such family accounts with $100 million or more in assets each, according to a recent study by the Wharton School at the University of Pennsylvania; about half of those accounts have $1 billion or more in assets each. Families need about $100 million in assets to start such a fund, which costs about $3 million a year to manage, the Wharton study reported.
About 50 family investment funds have formed a coalition and hired lobbyists to make their case with lawmakers that they should be exempt from the new rules. The families say their funds are aimed at maintaining wealth, not investing aggressively like private-equity firms or hedge funds, and therefore pose no systemic risk to the economy.
. . . The main lobbying vehicle for the families is an association called the Private Investor Coalition. Under lobbying rules, it isn't required to disclose the names of those who are funding the effort, and their identities couldn't be learned.
... The families hired Thomas Quinn, a top Democratic fund-raiser and friend of the late Sen. Ted Kennedy, and Jake Seher, who spent a decade as a top aide to then-Sen. Joe Biden. The two are paid a total of $60,000 a month, according to disclosure filings.
Oh, that $60K per month is just one of many clients. THIS is the Democratic establishment that calls us the "fringe left."
October 21, 2009
Here is another project I have been involved with lately:
Fight the Big Boys on Wall Street at www.BanksterUSA.org
The Banksters have pulled off the biggest heist of all time. They have crashed the global economy, throwing 7.5 million Americans out of work, emptying retirement and college funds and forcing many into hardship and homelessness. Yet they continue to be rewarded with trillions of taxpayer dollars that underwrite their Bankster bonuses, they prey upon the vulnerable with ballooning bank fees and macabre investment schemes such as "death bonds" and their taxpayer-subsidized lobbyists swarm Capitol Hill to prevent the passage of any meaningful reform of the financial system.
The Smackdown Starts Now
This fall is a critical time. Congress is now taking up a series of bills to restore confidence in the financial sector. If you want to rein in the Banksters and if you think America deserves better than a "boom and bail" economy, you need to muscle up and weigh in. Only you can tell Congress to prioritize the interests of Main Street over the interests of Wall Street.
Bust the Banksters at BanksterUSA
www.BanksterUSA.org is the go-to site for updates on the financial services re-regulation fights in Congress and for progressive netroots campaigning against the big boys on Wall Street.
Our "Action Center" is a hotbed of popular campaigning on the crisis.
We know that it is wrong that a full year since the Wall Street meltdown no employee of any major American bank or blue chip financial institution is behind bars. Compare this to the Savings and Loan crisis 20 years ago. No less than 1,852 S&L officials were prosecuted and 1,072 were jailed.
Our motto? Too big to fail, but not too big for jail! Click here to email the U.S. Department of Justice and the FBI and tell them to get cracking!
This week Congress is debating a key Obama administration reform proposal, one that would create a new "top cop" for consumers in the form of a Consumer Financial Protection Agency (CFPA). This new agency will tackle abusive lending practices and protect consumers from the deceptive tricks and traps of the financial services industry. We need to pass a strong bill to empower the agency to do battle with the Banksters, but the Banksters have promised to "kill" it.
Click here to tell Congress to ignore the Banksters and "Put a New Sheriff on the Block" with a Consumer Financial Protection Agency!
Our Action Center highlights the upcoming "Showdown in Chicago" which promises to be the largest grassroots protest against the Banksters of the American Bankers Association. The Action Center will also help us ramp up the campaign against Goldman Sachs' despicable "death bonds" - an investment scheme you have to see to believe.
Sign up to get the latest news and receive regular email alerts and action items. The Banksters may have the big bucks, but we have the big numbers. The only way to win reform is to make our voices heard!
Don't Let the Banksters Write the History of These Turbulent Times!
The Banksters may be whitewashing, but we can Wiki! We need your help to build a fully-sourced research companion to BankstersUSA.org on the web. It is a collection of editable Wiki profiles of the financial institutions, CEOs, lobbyists, front groups, issues and legislation related to the crisis and the bailout. It builds on our powerful Sourcewatch Wiki with its proven capacity to raise critical information in the Google-sphere so it can be easily found and used by citizens and journalists. We need citizen journalists to help us build this important resource and document the truth about these turbulent times. This Wiki is not a place for editorializing, but for quality research based on top-notch source material. Please visit the "Help Out" section of our Real Economy Project Wiki portal to learn more. It is easy and fun! Our motto? "Fair, accurate and documented."
The www.BanksterUSA.org site and our larger Real Economy Project are part of the Center for Media and Democracy (CMD). CMD was founded in 1993 as an independent, non-profit, non-partisan, public interest group focusing on exposing corporate spin and government propaganda. CMD brought you the book "Weapons for Mass Deception" before the Bush team failed to find weapons in Iraq, and we exposed "Fake News" in the media and the "Pentagon Pundits" on cable news. With this new effort, we will debunk the spinmeisters of the powerful financial services industry and help ordinary Americans take positive action on the financial crisis and the real economy.
This is Part II of Companies As Buy-And-Sell Commodities. See Part I, Companies As Buy-And-Sell Commodities - Workers, Customers and Country As Costs.
In Part I I wrote about a pattern we see over and over again: buying up good companies, shedding and outsourcing the workers, cutting their pay and benefits, outsourcing and cheapening the product or service, fleecing and mistreating the customers, closing the offices and factories and running up debt. If you want to make a few hundred million, here is the game:
- Find a good company that still respects its workers, paying decent wages and benefits, still respects its customers and produces a quality product or service, still respects and has ties to its community and keeps a plant open, maybe sponsors a little league team, etc. These are all "costs" to cut.
- Use other people's money: Work with an investment bank to finance the buyout, with the company itself as collateral, and pay the banking fees from the financing.
- Cut. Cut costs, including the quality of the product or service and customer support operations. Externalize environmental costs onto the community. Wait for the union contract to expire and offer wage cuts and elimination of benefits and refuse to negotiate (where are they going to get other jobs?), fire union organizers, threaten to close the operations and move them overseas, and don't worry about labor laws - they aren't enforced anymore.
- After breaking the union and cutting costs, close the plant. outsource production to China.
- Now the books look better because of reduced costs, so take on new financing and pocket it.
- Further stoke up the books for a couple of quarters using gimmicks like pushing product into distribution channels to make sales look better than they are, find another buyer and pass what’s left to them to repeat the cycle – there are always more costs to cut.
- Pocket your millions, then go back to step 1 and repeat the process with another company.
This is the buyout game and it is part of the story of what has happened to our economy, our jobs, our communities and our country. It has become a machine, with profits fueled by tax and social incentives. These incentives create a formula that follows the steps described above, with an inevitability to the consequences. Because it CAN be done, of course it IS done. It is a great game for short-term profits for a few. It is justified as "finding efficiencies" and the ideology behind it insists that the profits prove the market demands the behavior.
Machines do not have human concerns, they just do what they are designed to do. Their engines burn the fuel that powers them, their gears turn. As an example of what I mean take a look at what happens when this machine encounters companies that provide assisted living for the elderly A year ago I was helping the SEIU get the word out about the private equity game and especially the firm Lazard, which had been purchasing assisted living, retirement and nursing homes and putting them through the machine. I wrote then, in When Seniors Are the Product. Look at how they were treating our most vulnerable people,
OK, we have the perfect combination here. We have elderly, frail, sick, vulnerable, and they have some money. They are a captive audience, too, because people in this situation are not people who can pack up and move somewhere else. Senior care is a big business. You're talking about chains with hundreds of facilities each with dozens or even hundreds of living units you're talking REAL money. So in today's economy you're talking about a perfect target for exploitation.
[. . .] Atria was set up by Lazard LLC., a "financial advisory and asset management firm." Lazard is a private equity, or "buyout" firm. Yep, one of those big Wall Street outfits that you are reading more and more about. Lazard is supposedly based in Bermuda even though it lists [pdf] its "principal offices" as New York, London, Paris and Milan. (Its website doesn’t even list Bermuda on its "global presence" map. Wink, wink, nod, nod.) On their website they say that a core value is Citizenship,
[. . .] Here is what is going on: Atria has been reducing services, raising rates, cutting wages, and generally treating the residents and employees like money trees that exist to be squeezed.
In Extreme Wealth Just Isn't Enough, I looked at what could be motivating the people who do this,
Already extremely wealthy, it just isn't enough. It's never enough and it seems the more you get the more you need. You need it bad enough to squeeze more and more money out of old people too frail to even shower without help. You need to so bad that you keep the wages of people as low as you can and you do everything in your power to keep them from forming a union. You need that money. You need that money. You need that money. And you do what you have to do to get even more.
In Living and Working at Atria, I described how the machine turns people into nothing more than economic units
We are people, not economic units, and there is a difference. This may be a difficult concept to grasp after three or four decades of constant corporate-funded "free market" propaganda. But people make decisions for higher reasons than just making or saving a buck or two. Most people, anyway.
[. . .] The caregivers at Atria, at every level, deserve to be treated with respect and compensated fairly for their work.
But they're not. Of course.
Of course, this is all exactly what Atria and Lazard and Bruce Wasserstein are counting on. This is what the people and pension funds and others who park their money at Lazard are counting on. To them the seniors and the workers are just economic units, revenue streams and costs to cut, to be replaced if they don't perform efficiently.
And in Gouging Vulnerable Seniors -- What Can Be Done? I looked at the effect over time as this machine grinds on,
Many people and organizations recognize that such a system is not sustainable, harms the people who work for the companies, the communities around them, the customers and the economies in which they operate. Sure, a few executives make out like bandits for a while, but over time it doesn't do the rest of us any good, not even their companies. (Lazard and the Lazard fund that owns Atria, for example, have not been performing all that well. Meanwhile Wasserstein personally took home $42 million last year - even as Lazard stock lost 14%.)
More recently we saw the same pattern play out with the company Stella D’oro. The company went through the same buy-and-sell pattern. Stella D’oro was bought by Nabisco in 1992. Then Nabisco became part of Kraft in 2000. In 2006 Kraft sold the company to Brynwood Partners - a private-equity company. Brynwood bought the company with a plan to break the union and then drastically cut wages and slash benefits to lower costs and then resell. (Just like "flipping" a house.)
From last year, No Sweets When Striking the Cookie Factory,
The workers ... say there has been no effort to negotiate in good faith. They accuse Brynwood of having a plan to force them out of their jobs, noting that replacement workers were lined up before they even went on strike.
. . . “The financiers and speculators have brought the American economy to its knees,” they wrote. “The financiers at Brynwood Partners are trying to bring 135 workers to their knees, hiring scabs to do their work. The Stella D’Oro workers are taking a stand against the wrecking of our economy.”
But the union sued the company for unfair labor practices and won, so Brynwood “pulled a Wal-Mart,” closed the plant in retaliation, laid off the workers, and sold the remains to yet another company,
While Stella D'oro isn't in bankruptcy, its owner, Greenwich, Conn., private equity firm Brynwood Partners, in September announced that it would be shutting the company's doors and putting the company up for sale. Brynwood reportedly decided to sell the Bronx, N.Y.-based cookie company after a National Labor Relations Board judge had ruled in July that it had negotiated employee wages and benefits with the union that represents them in bad faith. That ruling apparently prompted the PE firm to make the sale, which has left 138 employees out of work.Company, jobs, factory gone, surrounding community devastated. As the pattern repeats itself, the rest of us worry that it could happen to us, that our own employer could be next. What many of us take from this is not to fight this, but to keep our heads down. We learn that we are a cost. We can be replaced. Don't ask for raises. Don't even think about joining a union. Keep your head down or they’ll single YOU out and cut your pay or “eliminate your position.” Across the economy the pressure builds, hours and workloads are increased while wages and benefits decline. Workers burn out and families are destroyed by the psychological fallout.
I have described here a destructive, unsustainable system that creates company- and society-breaking machines. These exist because of the economic and social incentives that our government has set up and we allow to stay in place. Breaking unions, stealing pensions, outsourcing jobs and squeezing customers all depend on government not enforcing laws and regulations – especially labor, consumer and environmental rules. (The last administration’s Labor Dept actually gave advice on how to break unions.) As long as we let the economic incentives call us "costs" and getting rid of us "efficiency" this will continue.
Certainly there is no incentive at the top to stop this. This system helps a wealthy few get ever wealthier and do not feel the consequences. The people who do this are celebrated as "successful." And if they don’t like the resulting devastation to the economy, community, country and world they can just hop into their private jet or yacht to retire to their private island or tax haven.
Of course, in the last year we have seen that this was not a sustainable system. The economy collapsed because everyone in the system – the workers, consumers, companies, banks, Wall Street – all hit the limits of how much debt you could pile on our backs. But we haven’t started to make any changes in the design of the system, or in the machines that unsustainably grind up our companies, workers, customers and country. And we haven't changed the ideology and rationalizations used to justify destroying lives and companies and our long-term prospects for short-term profits for a few.
But imagine if instead we put in place economic and social incentives that set up a sustainable system with company-making machines that direct all of this capital and energy toward building good companies that serve all of our interests. Call them "green machines." What if we set things up so people could get rich doing this instead? Then people would create green machines that would grind through the economy, finding companies and transforming them into businesses that serve their customers and communities, creating rewarding and fulfilling jobs in stimulating and enjoyable work environments, and building a better future for all of us.
On that note: Take a look at the agenda for the Building the New Economy conference, Thursday, October 29, 2009 — 9:30 a.m.-3:30 p.m. at the Washington Court Hotel in Washington, D.C.
This conference sounds the call for the new economy we must build out of the ruins of the old. It focuses on the need for a new agenda to revive manufacturing in America. It's free. But you have to RSVP.
Conservatives are blasting President Obama, saying he is causing a "weak" dollar. The Drudge Report has a headline or a story pretty much every day blasting this message out. Republican e-mails warn that the dollar is "collapsing" under Obama. Blogs and talk show hosts declare that civilization will cease, urging listeners to buy as much gold as they can.
But conservatives should know that the dollar is steady where it counts - against the Chinese Yuan. Yesterday, October 20, the exchange rate was 6.82653. On May 6 it reached a low of 6.82157 and on June 17 a high of 6.83743.
Conservatives react intensely to words like "strong" and "weak" without understanding the meaning. Here is what it means: Things made in America cost less when the dollar is lower, or "weak." A lower dollar creates an incentive for others to purchase things made in America, which means factories are busy, new factories can open, and jobs are created.
But while the dollar drops against every other currency the Chinese Yuan remains the same, and Chinese goods don't get more expensive - at least here. So our factories are not busier, the import/export imbalance stays the same and American jobs are not created.
One might ask, "How is this possible in a free market?" Indeed.
Take a look at the agenda for the Building the New Economy conference, Thursday, October 29, 2009 — 9:30 a.m.-3:30 p.m. at the Washington Court Hotel in Washington, D.C.
This conference sounds the call for the new economy we must build out of the ruins of the old. It focuses on the need for a new agenda to revive manufacturing in America.
-- Oh, it's free. But you have to RSVP.
This is huge news. House Dems want Medicare for everyone,
Say hello to “Medicare Part E” — as in, “Medicare for Everyone.”
House Democrats are looking at re-branding the public health insurance option as Medicare, an established government healthcare program that is better known than the public option.
. . . While much of the public is foggy on what a public option actually is, people understand Medicare. It also would place the new public option within the rubric of a familiar system rather than something new and unknown.
If they do this I think the battle is 90% won. Everyone loves Medicare.
I think they should say that are giving in to Republican demands to get rid of the public option and just letting everyone buy into Medicare instead.
October 19, 2009
Take a look at the Campaign for America's Future blog, Blog for Our Future. There is a LOT there. Bookmark it.
Also, there is great thought-provoking stuff at the Commonweal Institute blog, Uncommon Denominator. Bookmark that, too.
And take a look at the names of the poeople posting at both of these sites - you'll be surprised.
Finally, if you are in California you will want to check out the Speak Out California site!
October 18, 2009
Learn about the upcoming protests in Chicago: Showdown In Chicago http://www.showdowninchicago.org/
What happened to the economy? Without accountability corruption thrives. And there is still no accountability.
Read about one part of it -- how ratings agency executives got rich from knowingly giving toxic debt the highest possible ratings, paid to do so by the investment banks that also got rich (and then bailed out): How Moody's sold its ratings -- and sold out investors. Read the whole thing to understand it but it's about a corrupt bargain between the regulators at the SEC and other agencies the executives at Moody's and the executives at investment banks, letting them all get away with giving junk debt the highest ratings.
McCleskey had raised concerns about the integrity of the ratings process, and Moody's had excluded him from meetings in January 2008 with the Securities and Exchange Commission about the eroding quality of pools of subprime loans that Moody's had blessed with top ratings.
SEC officials, however, didn't bother to seek out McCleskey, even though he was the "designated compliance officer" in company filings with the agency. The SEC maintains that its officials met with Kanef because he was McCleskey's superior.
. . . Others who worked at Moody's at the time described a culture of willful ignorance in which executives knew how far lending standards had fallen and that they were giving top ratings to risky products.
"I could see it coming at the tail end of 2006, but it was too late. You knew it was just insane," said one former Moody's manager. "They certainly weren't going to do anything to mess with the revenue machine."
Moody's wasn't alone in ignoring the mounting problems. It wasn't even first among competitors. The financial industry newsletter Asset-Backed Alert found that Standard & Poor's participated in 1,962 deals in 2006 involving pools of loans, while Moody's did 1,697. In 2005, Standard & Poor's did 1,754 deals to Moody's 1,120. Fitch was well behind both.
What happened to the economy? Simple answer, executives engaged in corrupt schemes that made themselves millions upon millions, and eventually destroyed the companies and the economy around them. Here is the thing: this was not a bad plan, it was a good plan -- because they got rich and got away with it.
So far not one big corporate executive or investment banker is being prosecuted for fraud or anything else. No one is asking for the money back. No one is asking for accountability. In fact, in many cases, many of them were bailed out by the government and are still getting huge salaries and bonuses.
They got rich - really rich - castles in Europe, three ocean-going yachts and a private Boeing 767 rich. And got clean away with it. Many barely even pay taxes. So what message does that send about whether this is the right thing to do?
Without accountability corruption thrives. Our current government has made it clear they believe it is wrong to look back, point fingers, assign blame, etc. So it continues and will continue.
Oh, and torture, launching illegal wars and spying on Americans will be back, too, if Republicans get in again, because no one is being held accountable for that, either.
October 17, 2009
Well the last Bush budget year just ended. So how did the Republican budgets do? When Bush took office we have a HUGE budget surplus - over $230 billion. Alan Greenspan warned that we were paying off the debt too quickly. Then came Bush and his tax cuts for the rich, and the Republican spending binge.
The federal budget deficit soared to a record $1.4 trillion in the fiscal year that ended in September, a chasm of red ink unequaled in the postwar era that threatens to complicate the most ambitious goals of the Obama administration, including plans for fresh spending to create jobs and spur economic recovery.
Update - Oh, look, Republican blogs are claiming that the budget for the fiscal year that ended in September is Obama's budget, even though he didn't even take office until January! That;s like how FOX News puts an R after a Democratic legislator's name when they do good things, or a D after a Republican's when another one gets caught lying about an affair.
I wonder if the New York Times will ever write about the the people who go through our recycling the night before it gets picked up. They collect bottles to turn in for a dime, because that is all the income they can find. We live a few blocks from a church with a big "dining room" for the poor. Literally hundreds of people have to go there or they won't eat.
Out here in the real world things are different. People's unemployment pay is running out, and Congress is delaying extending it. And if you are unemployed you COBRA subsidies are also running out now -- no sign of Congress doing anything about that.
Spending in the U.S. on luxury goods and services spurted 29 percent in the third quarter from the previous three months, as consumers with the highest incomes unleashed pent-up demand, according to Unity Marketing.
[. . .] “No question that this quarter’s spending increase is good news for luxury marketers,” Danziger said in a telephone interview today. “Many affluent consumers returned after sitting on the sidelines for a year. However, the richest are few in number, 2.5 million households, so competition will be fierce to win their attention.”
File this under Concentration of Wealth, Bailouts
ACORN registers millions of voters.
The Republicans are talking about taking back the Congress next year. That strategy depends on keeping people from coming to the polls.
So they attack ACORN, in a typical, coordinated smear and fear campaign, leading up to a vote in Congress to defund the organization. And many Democrats went along with it.
I kind of hope that many of those Democrats are defeated next year because people who would have been registered to vote are not registered so can't vote.
Except for the consequences to the country and world when Republicans are in charge.
HOW many Iraqis died? HOW badly did they wreck the economy?
How can conservatives argue that:
1) Liberals dominate the media
2) Restoring the "Fairness Doctrine" will get rid of conservative voices in the media
October 16, 2009
They've got a Rep for that:
As we consider what we need to do to get our economy working again it is useful to look back at the things that went wrong.
The way people used to think about why you start a business was to make a product or provide a service. The business provides something that people need and if you do a good job and serve your customers well over time they will reward you for it. The better you do at that, the better you do for yourself. Right?
It's a pretty basic business model: a business does what it is in business to do, and people like it or don't, and the people who run the business do well or not accordingly.
For example, you would think that a mattress company was in the business of making mattresses, and a bakery was in the business of baking. You would think that an assisted living facility or nursing home company was in the business of caring for the people who came to them for care.
Maybe not – at least not for the owners and even managers of many of these companies. It turns out they’re not in those businesses. Sometimes, they’re not even there. Either way, they certainly don't care about mattresses or nursing homes or baking cookies. This is because of the rise of Wall Street dominance of American business. For the Wall Street crowd business models are something else entirely, and making something and serving customers is just not in the picture. In fact those things are in they way -- between the Wall Streeter banksters and their bonuses.
I’m talking about the private equity business, where the model is not unlike house-flipping during the insane housing boom. The model for them is get in, cut everything, grab all the cash you can and get out, never mind what it does to the companies, the customers, the employees or the country – that’s the new business model.
I wrote the other day about the Wall Street way of doing business:
Short-term gains for a few. Long-term harm to the rest of us.
… Our country let this happen because a wealthy few benefited in the short term from policies that harmed the rest of us over the long term. The wealthy few used some of the $$ gained to buy off lobby and contribute to campaigns of politicians who let them get away with it.
. . . The short-term benefits-to-a-few that were exchanged for long-term harm to the rest of us are now harming the rest of us here in the long term. We owe the rest of the world huge amounts of money. The economy has fallen apart because so many of us can't afford anything - like paying back the debts we had to take on to get by. Now the government can't do anything important because We, the People don't have the funds.
This is another story of a wealthy few selling off the country’s people and future, treating companies and people as commodities to be bought and sold for a quick short-term profit, with long-term harm done to the rest of us. The private equity company-buyout game works like this: buy a company, borrow against the company name and assets and put the proceeds straight into your pocket, sell off assets, outsource jobs, lay people off, cut pay and benefits for the rest, close facilities and factories, externalize costs onto the community, cheapen whatever the company makes or does, run up the debt some more, squeeze money out and pocket it and then sell. Hopefully you make off with the pension fund in the process.
Take a look at a recent NY Times story by Julie Creswell, about the destruction of Simmons Bedding, the mattress company, Profits for Buyout Firms as Company Debt Soared
Simmons says it will soon file for bankruptcy protection, as part of an agreement by its current owners to sell the company — the seventh time it has been sold in a little more than two decades — all after being owned for short periods by a parade of different investment groups, known as private equity firms, which try to buy undervalued companies, mostly with borrowed money.
Bought and sold by a parade of investment groups,
For many of the company’s investors, the sale will be a disaster. Its bondholders alone stand to lose more than $575 million. The company’s downfall has also devastated employees like Noble Rogers, who worked for 22 years at Simmons, most of that time at a factory outside Atlanta. He is one of 1,000 employees — more than one-quarter of the work force — laid off last year.
People wiped out,
But Thomas H. Lee Partners of Boston has not only escaped unscathed, it has made a profit. The investment firm, which bought Simmons in 2003, has pocketed around $77 million in profit, even as the company’s fortunes have declined.
. . . Wall Street investment banks also cashed in. They collected millions for helping to arrange the takeovers and for selling the bonds that made those deals possible. All told, the various private equity owners have made around $750 million in profits from Simmons over the years.
While a few made out like bandits.
They didn’t care about the employees. They didn’t care about the company. They didn’t care about the customer. They didn’t care about the country.
There were not in the business of making mattresses. And now America loses another company that made something.
Simmons is one of hundreds of companies swept up by private equity firms in the early part of this decade, during the greatest burst of corporate takeovers the world has ever seen.
Please read the entire story if you can. It’s the story of America since Reagan. The company was systematically plundered, slashing “costs” (aka the company’s future), cutting jobs and stealing pensions. (Bonus, read about how the CEO, while making $40 million, rarely showed up at headquarters, running the company from his yacht, with the company even paying the captain’s $92,000 salary. )
He didn't even bother to come in to company headquarters!
The chain of Simmons owners starts with William E. Simon, one of the architects of the modern conservative movement, buying the company, looting it. Then,
“A succession of private equity buyers came and went. Merrill Lynch Capital Partners bought Simmons in 1991 for … Merrill sold it to Investcorp, an investment group based in Bahrain, ... Two years later, Investcorp sold the company to Fenway ...
Then Thomas H. Lee Partners, known for Snapple, Rush Limbaugh’s early big advertiser, bought the company, and engaged in some financial magic. They:
“… created a holding company that it used to issue $300 million more in debt, which paid an additional $238 million dividend to the private equity firm. With that, THL had recouped its entire $327 million equity investment in Simmons.”
Yes, they borrowed against the company, paid themselves back what they paid for the company, sticking the lenders with the tab. And, of course, like the Wall Street bonuses from taxpayer bailous they get to keep that money, because … well just because.
THL was hardly alone in undertaking this sort of financial engineering, known as a dividend recapitalization. From 2003 to 2007, 188 companies controlled by private equity firms issued more than $75 billion in debt that was used to pay dividends to the buyout firms.
That was the story of one company destroyed by this private equity/hedge fund/ Wall Street game. Here is another, from May (also by Julie Creswell): Oh, No! What Happened to Archway?
Longstanding cookie makers with an extremely loyal fan base, Archway and its sister company, Mother’s, had their share of troubles in recent years as the once-family-controlled business that owned both brands was passed along from buyer to buyer — first to an Italian company, Parmalat, in 2000, and then, after an accounting scandal at Parmalat, to Catterton Partners in 2005.
The company was passed from buyer to buyer …
[. . .] “Those guys were stepping over quarters to pick up pennies,” he said. “They cut here and cut there and some of the things they needed to do. But, in my opinion, they threw away a lot of profits by a lot of bad decisions.”
After Catterton took over, Archway began ratcheting back spending on in-store promotions, which distributors contended made their cookies less competitive in stores. Catterton also abruptly shut a bakery and distribution plant in Oakland, Calif., which had made Mother’s Cookies for several decades. Operations were shifted elsewhere.
The product cheapened …
Besides putting 230 of the Oakland plant’s employees out of work, the closure had another negative effect. It lengthened the time between when the cookies were baked and when they hit store shelves around the country.
Some also believe that Archway altered its recipes or ingredients. Mr. Gallagher, the distributor, said that as time went on, he ended up having to eat a lot of cookies that he couldn’t sell. “I noticed, over time, they were getting worse and worse.”
Mr. Zinzer is more blunt: “Our cookies turned to crap. They were nowhere near as good as they used to be.”
A former employee inside the headquarters, who declined to be identified because of continuing litigation, said that as the company’s troubles worsened, the company began using less expensive ingredients in its cookies.
Customers treated like ATM machines,
When Mr. Pfeifer called Archway, however, to get a credit for the opened cookies, rather than simply filling out a form as he had done in the past, he said he was told he had to cut the individual seals on all of the wrappers on the pallet.
“Clearly that was meant to deter me from asking for credit. I said, ‘Forget it,’ ” Mr. Pfeifer said. “I took it all to the dump.”
Inevitably the story ends with this in the news last week: Mother's Cookies abruptly shut down
Mother's Cookies, an Oakland institution for 92 years, has been shuttered, its owner seeking bankruptcy protection for the company.
The ending was abrupt: Workers for the company, which shifted its baking and distribution operations to plants in Ohio and Canada in 2006, told workers Friday that operations would cease and cookies would no longer be made as of Monday.
. . . The owners did not comply with the federal law that requires a 60-day notification of any layoffs
Another plant shut down. More people laid off. Some very rich people pocketed a lot of money...
SEIU's Behind the Buyouts site.
Flipped. How Private Equity Dealmakers Can Win While Their Companies Lose -- NYT Videos on the private equity game.
Take a look at the agenda for the Building the New Economy conference, Thursday, October 29, 2009 — 9:30 a.m.-3:30 p.m. at the Washington Court Hotel in Washington, D.C.
This conference sounds the call for the new economy we must build out of the ruins of the old. It focuses on the need for a new agenda to revive manufacturing in America.
-- Oh, it's free. But you have to RSVP.
October 15, 2009
This is going to sound really weird, but read it, and then come back in a few days and tell me if I was right. The next right-wing conspiracy theory is that Obama is controlling the TV-show companies and using them to control people's minds and get everyone to go join the communist party ... or something.
You have to know how they think to get this one. The prequel is that story about the group of kids in a school who were videotaped singing a song about helping the President. The video got onto YouTube and the wingnuts turned it into a conspiracy theory about "indoctrination." And they hold tea-party-style protests outside of the school now. And, of course, FOX News pushes the whole thing over and over.
So here is the new nutcase conspiracy theory. Between Oct 19 and 25 several TV shows are going to promote volunteerism and service. Therefore you are all going to be forced to join the communist party.
Wow. Get it?
OK, volunteerism and service are ... wait for it ... liberal. Apparently if you click on the website that the shows put up to promote voluneering, you can find AARP, which is a liberal conspiracy.
Yes,that is what they are claiming. Go see for yourself. LEAKED NETWORK MEMO REVEALS: Obama Controls Your Television Set:
But this year there are a couple new strangers in town: “Volunteerism” and “Service.” You’ve heard of them. Their names have been bandied everywhere since President Obama took office...
... suggested topics pitched to an overwhelmingly left-of-center group: Education, health, environment, the economy and lastly — almost as an afterthought as some kind of “bi-partisan” cover – support for military families.
The plan is to weave volunteerism and service into the plots of their shows and then, ultimately, encourage viewers to get up off their sofas and go to a handful of web pages that are meant to provide opportunities for service. ... these seemingly benign volunteer search engines often seem to be Trojan Horses for controversial, left-wing causes.It continues like that.
The October 19-25 “I Participate” campaign broadcast on all four major television networks for a full week of programming will point viewers to www.iparticipate.org (as mentioned in Ashton’s tweet) and the AARP’s www.createthegood.com web sites.
. . . When I clicked for more info I found out that the phone bank listing was a month old, but there was a handy link for other opportunities to serve Planned Parenthood...
... if you are in, say, Virginia and want to volunteer on an environmental project, the very first opportunity you get is to volunteer as a Global Warming Ambassador.
Volunteering and heping others is a communist plot.
Our Media Need a Fair and Balanced Doctrine by Brad Friedman, at the Commonweal Institute blog.
October 14, 2009
An email I received (sent to Campaign for America's Future):
Subject line: who is the writing engine for dave johnson's work
I am aware of writing engines and nationally suggestive content data bases.
If you were not aware of it, which I think would be profound unprofessionalism, writers and blogs are often used in unison to attack or support certain issues.
I have found profound similarities in style nationwide in editorial and content of a few people in what I shall refer to as the johnsonian style and message.
It is obvious that the writing is suggested and that the rhetoric is patterned and predictable.
I was wondering what feed in your group and in particular the editor for dave johnson's content uses.
I was wondering also if it not to personal, though I think it should be offered on demand for the sake of knowing the edge to propaganda, what religion that editior might be, as it has a clear ringing note for the sake of italian laws and denial of USA Constitutional RIghts under Amendment 13 to be free from forced servility.
It is a bitchyness of people not getting to have the slaves they think they should own for whatever abusive manipulation they think they deserve.
And your writing engine, or automated editiorializations are typical and patterned in that regard.
So thank you for your honest response,
the Response can be email to this address: heididyke@XXXXXX
I think this is why we call them wingnuts.
But it is true, alas, I am a machine, a feed, an automated editorialization. A Johnsonian.
October 13, 2009
Stopping Banks From Fleecing, Looting, Scamming, Robbing, Swindling, Tricking, Cheating, Conning, and Generally Ripping Us Off
In the last several years we have all been fleeced, looted, robbed, swindled, thieved, tricked, cheated, scammed, exploited, ponzied, stung, conned, extorted, ripped off and bankrupted by the banks and other big financial companies. Finally the Congress is working on reigning them in. This week the Congress takes up whether to create a new Consumer Financial Protection Agency (CFPA). This is a very important bill, creating an analog to the Food and Drug Administration (FDA) and the Consumer Product Safety Commission (CPSC), designed to protect consumers from financial scams and general fleecing.
I was on a blogger call today with Elizabeth Warren to discuss this bill. This call was hosted by Heather Booth, Americans for Financial Reform, a coalition of 200 organizations fighting for this other reforms of our banking and financial system. Warren is Chair of the Congressional Oversight Panel - COP - but was not on the call in that capacity. She was on the call to explain why we need the CFPA. Warren originally proposed the idea of a CFPA, and you might know her from Michael Moore's movie, Capitalism: A Love Story.
Here is what Warren had to say: (from notes)
She has been studying what has been happening to people around the country. The status quo is bad. It created financial crisis and subprime mortgage meltdown with all of its implications, including millions losing homes, 10-12 million could lose to foreclosure before this is over.
Dangerous products were fed into the system. These products destabilized families and destabilizing families destabilized the economy. It's not just mortgages. Look at payday loans, and the traps involved… And credit cards.
What it comes down to is that people who never thought they were at risk, but then when interest goes from 9.9% to 29% it is just unmanageable. People are thrown to ground. When families get cheated we are all at risk. This destabilization at a family level echoes throughout the economy.
Safety works. People getting cheated. Agencies work.
Look at how credit card business models have shifted. The old model was a you getting a card based on your good credit, if you qualified. But now they hold up low interest or a free gift or say it is a cool card to have, and you get the card, and then they make their money from the traps and tricks in the fine print that people just do not know about. Lenders hide costs and prey on customers. So no one can compare the cards. It is a market driven by the tricks and traps they can hide.
We have the FDA. In the 1920s anyone with a box of chemicals and a bathtub could start a pharmaceutical company. How many people are alive today because now we have basic safety protections on drugs. And this makes it safe to invest in good products and good companies.
Look at the Consumer Product Safety Commission – the agency sets standards, and child car seats are safer etc.
The David and Gioliath nature of this story shows up in multiple ways. Lawyers that create these deceptive and dangerous products – come in well-funded teams. These companies use these teams of lawyers and sociologists and psychologists, and find as many ways as they can to trick people.
In contract law an equal contract is both sides have good knowledge and that is basis of legal binding in contracts. Both sides have an understanding of what they are agreeing to. But here we have had large financial institutions writing contracts no one understands and writing the regulatory rules over the last 15 years, and that is what got us into this mess. Then they turned to the taxpayer and said, "Bail us out."
They have survived because of that taxpayer bailout and their response is to turn around and fight to continue to be the ones who write the rules so they can do it all again.
This is about survival of families but also fundamentally a question of where our country and economy goes.
Then Ed Mierzwinski of U.S. PIRG talked:
We are up against a massive well funded lobby trying to protect the status quo. They are using the big lie.
This will create 1 agency instead of 7. It is replacing, not creating a new layer. The analog agency is the FDA.
The big issue now is preemption, where they are trying to override stale rules that might be stronger. We must allow states to have stronger regulations. Let the federal agency and regulations be a floor not a ceiling.
Mierzwinski then listed members of Congress who should be contacted to let them know that there is support for creating this CFPA:
Top of the list: Melissa Bean, D-Ill., because of her opposition to state preemption.
Also on the list:
Paul Kanjorski, D-Pa.
Dennis Moore, D-Kan.
Gregory W. Meeks, D-N.Y.
Carolyn McCarthy, D-N.Y.
Charley Wilson, D-Ohio
Ed Perlmutter, D-Colo.
Joe Donnelly, D-Ind.
Bill Foster, D-Ill.
Walt Minnick, D-Idaho
Mary Jo Kilroy, D-Ohio
Ron Klein, D-Fla.
Travis W. Childers, D-Miss.
Steve L. Driehaus, D-Ohio
Jim Himes, D-Conn.
Gary Peters, D-Mich.
Dan Maffei, D-N.Y.
Joseph Crowley, D-N.Y. (not a member of the committee, but is chief deputy whip and is the chairman of the New Democrat Coalition.)
Here is Elizabeth Warren talking about this agency, in July:
Also working on this: The Center for Media and Democracy is launching the Real Economy Project this week to "to simplify these complex issues and give you a voice in the debate surrounding proposed public policy fixes." They will also be launching a Bankster site to "to be your go-to site for updates on the financial services re-regulation fight in Congress and for progressive net-roots campaigning against the big boys on Wall Street." It will be at www.banksterusa.org and will be about accountability. (I'm also working with them on these.)
Finally, see this post from Sunlight Foundation: Top Financial Services Committee Members Rely Heavily On Finance Campaign Contributions,
One year after the biggest economic collapse since the Great Depression, Congress is still debating new financial regulations to protect consumers and prevent risk-taking in the financial sector. The House Committee on Financial Services is currently undertaking the important first step of writing, amending and voting on some of the pieces of the long-proposed financial regulatory reform. While debating these issues top committee members have been the recipients of disproportionate campaign contributions from the very industry that they are tasked with regulating.Go read -- it's enlightening.
October 11, 2009
Wow, it's nice being insulted when you are just trying to get "news."
John Harwood just said on NBC Nightly News that people supporting gay rights, "we've seen and certainly Bill Clinton leaned that Democratic presidents can get punished by the mainstream electorate for being too aggressive on social issues." (When did he learn that, exactly?)
On "the left as a whole": "the White House views this opposition as really part of the internet left fringe." "For a sign on how seriously the White House does or does not take this opposition, one advisor told me today those bloggers need to take off their pajamas, get dressed and realize that governing a closely divided country is complicated and difficult."
Also "a lot of people left right and center who think there is something finny and a little bit off about giving a Nobel Peace Prize to a President only in office nine months who hasn't accomplished any of his main goals."
The Village certainly know how to make one feel welcome.
I'm reading a a review of"Capitalism: A Love Story" at naked capitalism, and came across this,
"I grew up in small towns dominated by manufacturing plants, and I remember that they were prosperous, optimistic, and stable. People who had good jobs at the local mill were not the top of the social order; that was reserved for businessmen and successful professionals, like doctors and lawyers. But they could afford decent homes, creature comforts, vacations, and send their kids to college (not the fanciest, often a state school unless they got a scholarship, but their children could nevertheless hope to do better than their parents). But that had started fading by the 1970s as America’s economic dominance started to slip. Moore clearly is pained at the loss of the America that was (while pointing out it depended on the special circumstances of our post World War II political and manufacturing dominance) and our naivete in trusting in an economic model that has been been turned against the common man."
Remind me, why did we think it was a good idea to stop manufacturing things in America? Why did we outsource the jobs? Why doesn't our government have an industrial policy -- a plan to keep us economically strong?
Looking back at the past few decades I'm not really clear on this. I feel like we are waking up from that scene in Moore's movie where the hypnotists are mesmerizing their victims, looking around at the economic devastation that is the aftermath of decades of conservative economic rule and wondering, What were we thinking?
October 10, 2009
Maybe this video with another Nobel Peace Prizewinner will clue us in about why Europe thinks Obama deserves one, too. Al Gore on Saturday Night Live, in an alternate universe:
Has anyone else seen Dhoom 2? We just rented it from Netflix... Amazing. The world is a lot bigger than most Americans think it is.
Update - Here's a bit of what I was talking about:
October 9, 2009
Short-term gains for a few. Long-term harm to the rest of us.
Again and again we have seen American industries exported, the plants closed, the jobs lost, and government officials just letting it happen. The workers in the other countries are almost always paid less than workers here, sometimes dramatically less, which means they can't afford to buy things made in America. They often suffer from dangerous working conditions and the factories they work in often spread pollution that that harms people there and even affects us here.
Our country let this happen because a wealthy few benefited in the short term from policies that harmed the rest of us over the long term. The wealthy few used some of the $$ gained to
buy off lobby and contribute to campaigns of politicians who let them get away with it. Often the very politicians and their staffs were soon bribed hired by these wealthy few, for very high amounts. (Look at the sources of money raised by the Bush presidential campaigns, and the places where administration trade officials are employed since Bush left office for examples of what I am talking about.)
The result of these trade policies has been a huge and ever-increasing balance-of-trade deficit, year after year, which means America has to borrow more and more money to buy things we used to make here, or to buy things that we could have traded for if we still made things here. Yes, a wealthy few benefited greatly, many becoming billionaires many times over. Vast amounts of wealth have concentrated at the top in recent years. Short-term gains for a few. Many of the rest of us suffered dramatic pay cuts or lost jobs, lost houses, lost our health insurance, lost our pensions, etc. Long-term harms for the rest of us.
The short-term benefits-to-a-few that were exchanged for long-term harm to the rest of us are now harming the rest of us here in the long term. We owe the rest of the world huge amounts of money. The economy has fallen apart because so many of us can't afford anything - like paying back the debts we had to take on to get by. Now the government can't do anything important because We, the People don't have the funds.
So here is just the latest outrage. The Economic Policy Institute released a report yesterday, Through China’s looking glass—Subsidies to the Chinese glass industry from 2004-08,
Data and calculations in this report reveal that China’s glass industry received total subsidies approximating at least $30.3 billion from 2004 to 2008.
The accompanying press release tells us about the effect of this on American jobs,
The rapid growth of the Chinese glass industry, despite ongoing product quality issues, has already been felt keenly in the U.S. industry, which has contracted by about 30 percent (nearly 40,000 jobs) since 2001. States such as Arkansas, California, Florida, Illinois, Indiana, Massachusetts, Michigan, North Carolina, New Jersey, New York, Ohio, Pennsylvania, South Carolina, Virginia, and West Virginia have lost at least one out of four – or many more – of their glass industry jobs since 2001.
President Obama made the right decision when he enforced the trade laws in the case of Chinese tires by imposing a tariff on imports. In this case he can let China know that America is determined to keep our factories and jobs and will trade on a fair, even-handed basis from now on.
It is time to get angry about these policies that benefit a few in the short term but harm the rest of us in the long term. We need to reform our trade and manufacturing policies. We need to insist on two-way trade and a strong American manufacturing base.
This post originally appeared at Speak Out California.
What does it mean to be a "governor?" What does it mean to "govern?"
In the news, the Governor has threatened to veto 700 bills in an attempt to force the legislature to do his bidding on water policy.
700 important items all held hostage, trying to stampede and scare the legislature to do something in a hurry, while terrible scare stories circulate on talk radio and throughout corporate media. Does this sound like a familiar tactic?
Water policy is complicated because over many decades wealthy real estate developers bought permission to build huge swaths of housing in dry area, so water needed and needs to be piped in from ... somewhere else. And huge agricultural interests make a lot of money using water that used to be heavily subsidized, meaning the people paid for the water and a few wealthy corporate interests pocketed the profits.
At the same time there is less water to go around. We have had three years of below-average rainfall, which is possibly a permanent condition because of climate change (which Republicans deny is happening). And the destruction of the environment and fisheries and groundwater caused by past bad practices is catching up, so hard choices must be made. Does our government protect the people, the environment, corporate profits?
So on one side of this we have giant corporations and the short-term profits they suck out of our communities and state, and of people who are where they are after being lured there for the sake of those short-term profits, and who eat the way they do because government had been "persuaded" (paid) to subsidize the water for the sake of those short-term profits. People need water to drink even if they do live in a desert and need to eat and have gotten used to food that costs less because the water has been subsidized. (But maybe they don't need to water their driveways and nice lawns.)
On the other side we have the long-term interests of most of the people and of the environment. See if you can guess which side the Republicans and the Governor are on?
Click through to Speak Out California
The Nobel Peace Prize is awarded by Europeans. Europe doesn't have America's corporate media filtering everything we "know."
Europeans understand that defeating the Republicans was a very, very big deal for peace in the world.
Must read: Gut Check: Here's the Meat of the Problem
According to a 2006 United Nations report, livestock accounts for 18 percent of worldwide greenhouse gas emissions.
. . . Two researchers at the University of Chicago estimated that switching to a vegan diet would have a bigger impact than trading in your gas guzzler for a Prius (PDF). A study out of Carnegie Mellon University found that the average American would do less for the planet by switching to a totally local diet than by going vegetarian one day a week.
October 6, 2009
As a blogger I am sent books by publishers, which I try to read and always hope to write about. I have mentioned a few of them here, but haven't found time for any full reviews.
About once every six months someone clicks the "Donate" button. I haven't been getting many ads here, but there is one here right now. The ad revenue has not kept up with the cost for hosting and bandwidth.
That's about it. This is not done for the money.
I think once in a while we do get a professional commenter, though.
October 5, 2009
The twin crises of the economy and health care exposing to all the control corporate money exerts over political decisionmaking in America.
Providing health care for citizens is ruled out because it would interfere with insurance company profits.
Wall Street gets bailed out and uses the money to give out huge bonuses to a few -- enough to pay for health care for everyone else!
And then there is the real crisis. We cannot do anything at all about climate change because the oil and coal companies are flooding the political sphere with cash.
What to do about it?
The public perception of President Obama's accomplishments is firming up:
"Jack and Squat."
Oh, hey, what about those Wall Street bonuses? Good job doing something about that.
Friday’s jobs report said 263,000 jobs were lost in September.
BUT that is after 571,000 people gave up actively looking for work. The number of jobs lost last month was 263,000 plus 571,000 = 834,000.
The "stimulus plan" is currently creating (and/or saving) between 200,000 and 250,000 jobs a month. Yes, that means the real job loss would have been at least 1,034,000 without the assistance of the stimulus plan.
On top of that the "birth/death" model -- the government's assumption that a number of small businesses are starting up that they are not tracking -- is overestimating job creation, leaving policymakers without needed warning signals. The job loss numbers for the last year are expected to be revised upward by 824,000 early next year as a result.
This is bad. Really bad. We need a real jobs program, and we need it bad.
There is something else we need: we need progressive leadership that understands how important this is to people.
Here is what I mean. I came across a news story from the fight over the stimulus plan earlier this year, that now in light of Friday’s terrible jobs report says a lot more than it said at the time. House Dems Strip Stimulus of $200 Million Provision to Refurbish National Mall,
“The move was made amidst a torrent of GOP criticism about wasteful or non-stimulative spending in the bill, including those two projects, as the president attempts to woo House GOPers.”Yes, the House gave up this project that would have brought jobs to DC - and fixed up the the National Mall - to try to get Republican votes. How did that work out? How many House GOP votes did they get?
How many people in DC could be employed fixing up the mall and other buildings? The Democrats took out $200 million that was originally in the stimulus without gaining a single vote for the bill for doing it!
Meanwhile, the terrible jobs report showed that state and local governments are shedding jobs,
"Government employment fell by 53,000, with the largest drop—24,000 jobs—in the noneducation component of local governments."With that in mind, let me remind you of this brilliant negotiating tactic: Senate Stimulus Compromise Deals a Blow to Cash-Strapped States,
... "state stabilization funds" ... were cut back by $40 billion this weekend in the deal cut by Senate centrists.That's right. The original stimulus plan provided funds to help keep states from laying people off. These funds were cut -- and now states are laying off.
The compromises in the stimulus plan have consequences, and those consequences are people's jobs. The compromises were an experiment in "bipartisanship" that failed. The stimulus package gave up several important things, but how many Republican votes were won over? And as a result real people are losing real jobs.
Making matters worse, unemployment compensation is starting to run out for many people who were laid off when this mess started. AND the COBRA health insurance subsidies are running out soon as well! On top of that, contractors - employees who are not called employees because companies can get away with not paying benefits, stock options, unemployment insurance, etc. - a huge component of the labor force, don't even get unemployment or COBRA in the first place.
We Need Jobs Programs NOW
So here is an idea from outside of Washington: How about our government help our people by putting together some real jobs programs? Put people to work while we figure out how to fix the economic mess that conservative policies created.
It is time to use the power of government to start doing something that helps people, and that is not blocked by a misplaced need to get "centrists" (read: politicians trolling for payments/future jobs from big corporations) to like you or a fear that Rush Limbaugh is going to say something bad about you if you go ahead and do what we elected you to do. Here is a news flash: The market-fundamentalist corporatists are not going to like you, and Rush Limbaugh IS going to say bad things about you. Get a clue, they are not responding to the carrots so start using sticks.
Friday's jobs report says this mess is not going away any time soon. Friday’s jobs report shows that things are too serious and too many Americans are suffering for the administration and congressional leadership to continue playing nice guy and give-in strategies. This is important to too many people. People need to be able to eat and have shelter – never mind the health care fiasco – and they need this now.
And it would be politically popular. Think about this: giving people jobs would be politically popular.
Here are some job ideas:
Why don’t we pay people to start retrofitting homes and buildings today to be energy efficient, for free?
Why don’t we pay people to do thousands of projects in the national and state parks?
Why don't we add a teaching assistant to every classroom> And why don't we hire enough teachers to cut class sizes in half?
Why don't we fix all the roads and bridges that haven't been repaired for decades?
What about direct aid to manufacturers who still cannot get credit?
Here's a big one: why don't we cut the workweek to 30 hours? How many people will that put to work? Do you think people are going to object to having to work 30 hours instead of 40?
Oh, and why don't we fix up the National Mall in Washington DC? It needs it and people in DC need jobs. There is simply no excuse not to do this.
This from the Federal Trade Commission: FTC: Bloggers must disclose payments for reviews,
The Federal Trade Commission will require bloggers to clearly disclose any freebies or payments they get from companies for reviewing their products.
It is the first time since 1980 that the commission has revised its guidelines on endorsements and testimonials, and the first time the rules have covered bloggers.
My question: will this include people leaving "customer review" comments who are obviously working for the company that makes the product they are "reviewing?"
October 4, 2009
The experts say that we are starting a recovery, and economic signs are pretty strong.
Why, then, are short term interest rates at approx. zero?
October 3, 2009
Banks that received government bailout money gave $33 Billion of that taxpayer money out as bonuses just this year. How much taxpayer money will be given out as bonuses next year and the year after that?
Meanwhile the apparent solution to people not being able to afford health insurance is they will be ordered to buy it. That is what a "mandate" means. Even with subsidies the poor will have to pay up to 13% of their income. The rest of us have no upper limit on what we will have to pay.
Insurance companies are ecstatic about this. Bankers are feeling pretty good, too.
I wonder how the voters are going to feel about all of this next year?
The experts say don't worry about the economy, and especially don't question the economic paradigm - the internet once created a lot of jobs therefore someone will invent something that makes everything better again.