Tuesday, December 30, 2008

US Military Planning for Civil Unrest


A newly released paper by the US Army War College warns that US troops may be needed to fight its own citizens who protest against economic conditions. The paper, written by Lt. Colonel Nathan Freir, is titled "Known Unknowns: Unconventional Strategic Shocks in Defense Strategy Development."1

If employed, this would not be the first time US forces faced combat against its own civilians. Although National Guard troops and police have frequently been called up to fight the public, regular army troops have also been used. The Bonus Army of 1932, for example, was a protest of 15,000 to 20,000 veterans and their families lasting several months, until US troops were brought in to apply the threat of deadly force against these people at the nation's capitol.2,3

1. http://www.truthout.org/123008B
2. http://www.loc.gov/exhibits/treasures/trm203.html
3. http://www.eyewitnesstohistory.com/snprelief4.htm

Wednesday, December 10, 2008

The End of Retirement

Frontline (December 9, 2008) presented a stirring account of how corporations have shifted the retirement financing burden to workers over the last four decades. After 1974, many companies began shifting from traditional company pensions to 401K's. According to Frontline, this cost shifting has amounted to a 40% increase in retirement burden to workers. Today, many older workers are unable to retire due to this shifting of responsibility away from corporations.1

This account details only one part of a systemic and decades long anti-worker movement, and only one policy in a set of actions, laws and regulations to degrade retirement, stagnate wages, increase medical and educational costs, impoverish the working poor, and indoctrinate and dumb down the citizenry. See my "War on the Working-Class Timeline" in the right column.

On December 11, the Senate passed the "Worker, Retiree and Employer Recovery Act of 2008." A key part of the bill allows corporations to stop funding workers pensions. The anti-worker U.S. Chamber of Commerce, Business Roundtable and the National Association of Manufacturers pushed for its approval. The Senate measure was passed with a voice vote. Voice votes are anti-democratic strategies used in the Senate to deny responsibility.2

1. http://www.pbs.org/wgbh/pages/frontline/retirement/
2. http://www.guardian.co.uk/world/feedarticle/8158190

Saturday, December 6, 2008

Laid Off Workers Occupy Chicago Factory


Two hundred and fifty United Electrical Union workers have occupied a Chicago vinyl window factory since Friday. Today hundreds of supporters protested outside the plant in solidarity. The actions took place after the manufacturer failed to give its employees the 60 days' notice required by law before closing down.1,2

Workers are only asking for vacation and severance pay due them. According to the CEO of Republic Windows and Doors, its creditor Bank of America refused to allow Republic from paying its employees. It is notable that B of A recently received a $25 Billion bailout from the US Treasury (aka the People).

From AP's Rupa Shenoy:2

"Across cultures, religions, union and nonunion, we all say this bailout was a shame," said Richard Berg, president of Teamsters Local 743. "If this bailout should go to anything, it should go to the workers of this country."

Outside the plant, protesters wore stickers and carried signs that said, "You got bailed out, we got sold out."

Larry Spivack, regional director for American Federation of State, County and Municipal Employees, Council 31, said the peaceful action will add to Chicago's rich history in the labor movement, which includes the deadly 1886 Haymarket affair, when Chicago laborers and anarchists gathering in a square on the city's West Side drew national attention when an unidentified person threw a bomb at police.

"The history of workers is built on issues like this here today," Spivack said.


1. http://twincities.indymedia.org/2008/dec/chicago-factory-occupied
2. http://chicago.indymedia.org/newswire/display/84884/index.php
3. http://www.google.com/hostednews/ap/article/ALeqM5ildwrFjwHYjvJPX2edZgBnNb8EEQD94TID980

Sunday, November 30, 2008

Labor Department Lowers Bar for Worker Safety

The Bush Administration's Labor Department has enacted last minute regulations reducing safety for US workers. The new policies would allow for the use of highly toxic materials until there are lengthy industry-specific studies showing ill effects on workers.

According to the NY Times, the Labor Department and its sub-departments "control work-related substances such asbestos, benzene, cotton dust, formaldehyde, lead, vinyl chloride and blood-borne pathogens... the department is constantly considering whether to take steps to protect workers against hazardous substances. Currently, it is assessing substances like silica, beryllium, and diacetyl...."

Although the policy was opposed by the Senate, the Department has the right to enact such measures. The policy was supported by the US Chamber of Commerce, a lobbying group that supports anti-worker policies.

This anti-worker regulation is not the only rule change from Washington. According to the NY Times additional regulations "would allow coal companies to dump rock and dirt from mountaintop mining operations into nearby streams and valleys. Another, issued last week by the Health and Human Services Department, gives states sweeping authority to charge higher co-payments for doctor’s visits, hospital care and prescription drugs provided to low-income people under Medicaid."1


1. http://www.nytimes.com/2008/11/30/washington/30labor.html?bl&ex=1228194000&en=c7382f26209af6ce&ei=5087%0A

Wednesday, November 26, 2008

The San Francisco Chronicle reports that the US bailout of the fictitious capital market has now reached $8.5 Trillion in obligations. Click on the image below to see the accounting so far.



http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/11/26/MNVN14C8QR.DTL

Tuesday, November 11, 2008

The People's Analysis

I have found that some of the most coherent analysis of social, historical, and economic conditions in the US comes from unpaid writers.


From MO:

"Newsflash dips. Free markets are ruthless. If our markets were truly free, trust me, you wouldn't be talking so highly of them. Ever see a Lion maul something in the serengeti? Now tell me, would you want to play with a lion in its natural habitat? Of course you want a cage around that lion if you're going to go anywhere near it.

The bottom line is that none of you are anything compared to the big shots in the world who have money, brains, and networks of friends you can only dream about.

Most of you are currently indentured servants who owe a quarter or more of your lifetimes earnings to a bank in the form of a house, car, and education. You owe this money inside a system that is designed to funnel more money up to the top, to those big shots I mentioned. The system is made so that when you want to enjoy your success in the form of a home, you pay extra to the rich for that right, and when you want to improve your life in form of an education, you pay extra to the rich for that right.

In the current system you will be devalued due to your economic starting point, regardless of your talent you will be devalued by the simple fact of not being rich already. And should you have extraordinary talent, you will be required by mechanisms in the system to help make the rich richer before you are allowed to join the rich.

And that is a tiny minority that will ever make it to the top like that as most will either luck into it or inherit it.

The bottom line is that capitalism as a truly "free" market would be barbaric, because even as it stands right now, it is unfair.

Now, go forth and keep making that money for the man."


From CA:

"Reading the comments in this post make me think I have landed in lala land with people who neither understand economics or history. Totally free markets result in only one thing 1% of the population owning everything and 99% as their servants or slaves. This is the ultimate conclusion of all free markets and can be observed in certain Asian countries in all of its glory today. Free markets do not encourage growth or innovation, as those who own everything refuse to invest in anything that will not make them richer. Only through regulation is the wealth of a free market forced out of the clutches of the very rich and powerful. The amount of regulation determines how fairly that wealth is spread and how secure the overall economy will be. Teddy Roosevelt and his distant cousin FDR made exactly the right decisions, even though they themselves did not benefit from those decisions. Both Teddy and FDR were among the filthy rich. Without those decisions America would not exist as it does today. America would be a backward third world country still struggling to get out of the mire. Most people I know who want free markets are just looking for the government to get out of the way so they can rape someone else. These people are greedy and amoral, in that they are only concerned about themselves and are willing to do anything to get theirs. That is going back to the mire, not moving ahead. If you really want that type of society, then you need to look at moving to some of those aforementioned Asian countries, and stop calling yourselves Americans."

http://www.usnews.com/blogs/flowchart/2008/9/30/4-myths-about-free-markets--and-their-demise/comments/

Monday, November 10, 2008

More High Class Hustles

Three new economic "events" occurred today. All of these events benefit the ultra-rich at the expense of working-class folk.

The US Treasury has given ailing credit card company American Express the status of bank holding company. This allows the corporation to take advantage of the Troubled Asset Relief Program (TARP). American Express can also issue government guaranteed bonds.1

Mortgage bundler Fannie Mae announced that it is likely to require more money in its bailout. The Treasury originally agreed to a $100 Billion plan, but corporate losses have been greater than predicted. FME has an estimated $880 Billion in outstanding debt.2

Insurance giant AIG is receiving additional government assistance. The tab for this bailout has expanded from $80 Billion to more than $150 Billion. AIG has had significant investments in credit default swaps.3


1. http://www.nytimes.com/reuters/business/business-us-financial-usa-amex.html
2. http://www.bloomberg.com/apps/news?pid=20601087&sid=a.iQh4uHj3X8&refer=home
3. http://www.nytimes.com/2008/11/11/business/11views.html

Friday, November 7, 2008

Obama Wins Election as Working-Class Face Tough Times

Journalist and economist Robert Kuttner discusses the political decisions necessary to prevent an economic depression. Kuttner prescribes a large-scale jobs program to fix infrastructure and and an emphasis of IRS reviews on tax-dodging corporate elites and off-shoring corporations rather than reviews of working-class people using the earned income tax credit.

Source:
http://www.npr.org/templates/story/story.php?storyId=96694999

Monday, November 3, 2008

Credit Card Fraud--By the Credit Card Companies

Banks and credit card companies are now reaping the effects of a society that systematically replaced decent worker pay with a society of debt, credit, speculation, usury, and anti-trust violations.

On October 30, American Express reported that it will fire 7000 workers or 10% of its workforce. Business insiders refer to job cuts as "efficiencies," and often reward corporations for this behavior. Apparently, American Express packaged up credit card debts and sold them to investors. But that business appears to be drying up.1

On November 3, Citigroup, a bank and credit card lender, announced a $1.44 Billion loss from its "bonds." Although credit card debt does not pose as great a threat to the economy as the mortgage banking crisis, prognosticators say the credit card situation will worsen in 2009.2

"Bundling" debt into securities was also a factor in the massive failures of the Fannie Mae and Freddie Mac who securitized mortgages from predatory lenders. According to CNBC, "there is roughly $1 trillion of outstanding credit card debt—compared to $14 trillion worth of outstanding mortgages—and in the second quarter of 2008, $385 billion of this had been bundled into asset-based securities, according to the Securities Industry and Financial Markets Association."3

The largest US credit card lenders are Discover Financial Services, Bank of America, Citigroup Inc., JPMorgan Chase, Capital One Financial Corp., American Express Co. and HSBC Holdings. Bank of America, Citigroup, JP Morgan Chase, and Capital One have already received billions in relief from the US Treasury (see 11-13-08 post).4

In other credit news, MasterCard had its second consecutive quarterly loss. The company's loss included a write down for settling a lawsuit against Discover and American Express. MasterCard (36%) and Visa (51%) dominated the credit card market in part by violating anti-trust laws.5

Credit card companies profit by taking a fee, about 2%, from retailers. Retailers assume that consumers will buy significantly more, perhaps 30% more, if they use plastic rather than cash.6

Not surprisingly, as an election nears, relief for working-class debtors facing fates much worse and more permanent than quarterly losses is being discussed but not settled.7


1. http://www.marketwatch.com/news/story/american-express-cut-10-work/story.aspx?guid={AF32DE3C-5513-475D-B8F5-838F3CD757FA}#comment935571

2. http://www.businessweek.com/ap/financialnews/D947GNK00.htm

3. http://www.cnbc.com/id/27181200

4. http://www.iht.com/articles/ap/2008/11/04/business/NA-FEA-US-Credit-Cards-Plight.php

5. http://www.bloomberg.com/apps/news?pid=20601103&sid=atrKrDBPX8TQ&refer=news

6. http://money.cnn.com/2008/10/22/news/economy/retail_cash/index.htm?postversion=2008102212

7. http://www.marketoracle.co.uk/Article7093.html

Monday, October 27, 2008

Even More Welfare for the Rich

Capital One Finance, infamous for its predatory lending practices, is selling $3.55 Billion of its stock to the US Treasury as part of the bank bailout. While Capital One may use the money to buy other banks, its working-class debtors, however, are subject to survival of the fittest.

According to CNN Money:

"In a note to clients, Piper Jaffray analyst Robert Napoli said he believes Capital One may use the investment to acquire another depository institution."

"We view this positively for Capital One as this is cheap capital and suggests the government views Capital One as a survivor," Napoli wrote. "In the near term, we don't expect this to lead to an acceleration in lending, though it certainly positions the company very well from a capital perspective."

Capital One made $374 million in profits last quarter, below estimates.1


Senator Henry Waxman has stated concern that bank bailout money may be used for executive compensation and bonuses. A survey by eFinancialCareers reports that two-thirds of Wall Street professionals expect a bonus this year, and 36% are anticipating a larger bonus than in 2007.2

1. http://www.aol.in/news-story/capital-one-to-sell-$3-55b-in-stock-to-governmentdollar/2008102709150001548403

2. http://www.washingtonpost.com/wp-dyn/content/story/2008/10/29/ST2008102900989.html

Thursday, October 23, 2008

Neoliberal Icon Feigns Ignorance of Capitalism

Former Fed Chairman Alan Greenspan was called into Congress today to explain what went wrong with the flagging economic system. Greenspan admitted that his deregulatory philosophy "did break down". He added that he had been "shocked" by the crisis and that "I still do not fully understand why it happened."1 The Former Fed Chief admitted that "additional regulatory changes" were required "to return to stability, particularly in the areas of fraud, settlement, and securitization."

A recent article Newsweek article by Michael Hirsh explains that Greenspan's inaction, his failing to write rules for subprime lending, had a major effect on this economic environment. Hirsh's article adds that the so-called regulators, the Office of Comptroller of Currency and the Office of Thrift Supervision were sponsored by the industry rather than the government.2 OTS customers have included IndyMac, Washington Mutual, Countrywide, and Merrill Lynch.

The US Labor Department reports that the U.S. economy has now lost jobs for nine consecutive months, with more losses expected in October. The Department reports that 760,000 people in the US have lost work this year.

In other news, The NY Times reports that as a consequence of this economic downturn, more people are reducing their medications.3 The US currently spends $2.26 trillion per year on medical care, the highest costs in the world, although health outcomes are worse than several other nations.


1. http://www.marketwatch.com/news/story/Regulators-say-they-made-fateful/story.aspx?guid={7299997D-15B2-4DF5-AA87-DDE94260DD8E}

2. http://www.newsweek.com/id/159346?tid=relatedcl

3. http://www.nytimes.com/2008/10/22/business/22drug.html?scp=1&sq=medications&st=cse

Wednesday, October 22, 2008

A Trillion Plus...

According to Congressional testimony by officials from Moody's and Standard and Poor's, conflicts of interest were responsible for these credit rating agencies failing to accurately rate mortgage-backed securities. Although the information is not new, these admissions continue the narrative of corporate malfeasance and its role in the economic crisis.

Hedge funds (semi-secret financial organizations with trillions in investments, yet almost no oversight) are facing massive losses and possible bankruptcies. Although the effect of these future losses is presently unknown to the public, it is known that retirement plans have significant investments in them.

Responding to the working-class sentiment of this crisis, Rod Starz and G1 (part of the group Rebel Diaz) do their rap "A Trillion."

Monday, October 20, 2008

Yet Another Plan

The International Labour Organization predicts that another 20 million people will face unemployment in 2009. The ILO also reports that an additional 40,000,000 to 100,000,000 people face poverty of less than $2 a day next year. Meanwhile, Fed Chairman Ben Bernanke is proposing another economic stimulus package for the ailing US economy. Bernanke has refused to say that the US is in a recession.

In other news, two major retailers, Mervyns (149 stores) and Linens and Things (587 stores--17,500 employees last year), are closing their doors. Circuit City, a major electronics retailer, is declaring bankruptcy, and is considering closing 150 stores. This is the second wave of retail closings (see 8-4-08 post). GM and Chrysler are also engaged in merger talks which are likely to result in more working-class people losing their jobs.
http://afp.google.com/article/ALeqM5hF0bLPADTV6u8A59E07oBbyW1naQ

Monday, October 13, 2008

Plan B: Government Bails Out Failing Banks as More People Lose Homes

As part of the US government bailout,the US Treasury plans to buy up more than $125 Billion in stock of nine poorly performing oligopolistic US banks. Three of the enterprises, Goldman Sachs, Merrill Lynch, and Morgan Stanley were, until recently, investment banks who gambled billions in credit default swaps. Another $125 Billion will go to other banks and thrifts. While politicians have made assurances that something will be done to reduce mortgage foreclosures, hundreds of thousands of working-class people still face losing their homes and their futures. Measures to ensure corporate transparency and accountability have also largely been ignored.

Citigroup $25 Billion
J.P. Morgan $25 Billion
Wells Fargo $25 Billion
Bank of America $12.5 Billion
Merrill Lynch $12.5 Billion
Goldman Sachs $10 Billion
Morgan Stanley $10 Billion
State Street Bank $3 Billion
Bank of New York $3 Billion

Thursday, October 9, 2008

The Bailout So Far: Even Greater Than Imagined

Jennifer Barry (Marketoracle.com) presents a gloomy picture of the economic crisis. With Fed activity included, the total bailout has now exceeded $2.1 Trillion. The number includes Term Auction Facilities (see 4-8-08 post). An additional $37 B+ have been added to $85 bill to shore up insurance giant AIG. In other news, CNN reported that almost 60% of US people surveyed thought an economic depression was very likely or somewhat likely.

Sunday, October 5, 2008

Explaining the Economic "Crisis" and Debunking Racist Scapegoating

In a classical case of racist scapegoating, so-called conservatives are blaming "minorities" and the 1977 Community Reinvestment Act (CRA) for the recent financial crisis. The law was created to reduce redlining and and to let working-class people buy houses in lieu of living wages. Unfortunately, lenders took advantage of the situation, offering predatory adjustable rate/subprime mortgages that could not be paid. Here's an example of how the scam worked:



Siding with the predatory businesses, the conservatives allege that people of color took advantage of the law and bought houses they couldn't afford, and that this was the reason that the financial industry failed. Zenitha Prince (Afro.com) explains, in detail, that the Act had nothing to do with the crisis. About 80% percent of the lender institutions (finance companies, bank subsidiaries, and thrifts) did not have to comply with CRA standards. Fifty-eight percent of the subprime loans were taken out by Whites. It wasn't government meddling, in this case, that effected the crisis; it was corporate greed. However, this won't stop propagandists from perpetuating this disinformation.

http://www.afro.com/tabid/456/itemid/1739/Conservatives-Blame-People-of-Color-for-Wall-Stree.aspx

The Credit Default Swaps market faces another difficult week as hundreds of billions of dollars in Fannie Mae, Freddie Mac, and Lehman Brothers swaps go up for auction.

http://www.marketwatch.com/news/story/trouble-ahead-massive-credit-default/story.aspx?guid={9F86B14D-12F4-46DD-8C9E-FB4610D8817F}&dist=hppr

60 Minutes Steve Kroft does a fair job, albeit belatedly, at explaining the incompetence and greed on Wall Street that led to the crisis.





Editor's Note: See the link to "Reverse Redlining" which explains that people of color were targeted for subprime loans even though many were eligible for conventional loans.

Thursday, October 2, 2008

Progressive Proposals Call for Relief from Subprime Predatory Lending Instead of Another Corporate Bailout

Listening only to the mainstream media, one might believe there were no reasonable alternatives to the $700 Billion (now $810-850 Billion) bailout. Progressives and radicals (see URLs below) have presented reasonable alternatives that would not increase the pace of class inequality in the US. These alternatives would include relief for the working class, accountability for corporate executives, and transparency in business transactions.

http://www.democracynow.org/2008/9/30/bridge_loan_to_nowhere_house_rejects
http://www.truthout.org/article/howard-zinn-from-empire-democracy
http://www.zmag.org/znet/viewArticle/19000
http://www.votenader.org/media/2008/09/24/meltdownbailout/

Monday, September 29, 2008

The Creation of Financial Crisis

Few if any politicians, Wall Street moguls, economists, or writers have been straightforward with America about the economic down cycle and the latest $700 Billion corporate bailout proposal (HR 3997). It's hard to know what to believe, but these people have a track record of deceiving the working class. The tab so far has been $30B for Bear Stearns, $ 9B for Indy Mac, $300B for Fannie Mae/Freddie Mac, and $85B for AIG.

Thomas Wolfe describes the lives of the "Masters of the Universe," hedge fund managers who took the money and ran as the house of cards they created, the false economy, collapsed.

There have been a few who talked of the dangers of unfettered markets: liberal economists Nouriel Roubini, Robert Shiller, and John R. Talbott* and historian Stephen Mihm, on the academic side. But the information was drowned out by louder imprudent voices.

This last among many so-called "crises" took decades to be created (see 3-14-08 post on Upper Class Welfare). Unfortunately, radical economists, who could probably provide the most thorough historical analysis, have been marginalized.

Citigroup purchased Wachovia Bank assets today, leaving an unknown amount of losses for the public. It is only another step in a series which privatizes profits, socializes losses, and undermines the working class. [Update 10-3-08: Wells Fargo bought Wachovia Bank after a federal deal was scrapped. Ailing Citigroup is considering filing a lawsuit to stop the deal.]

*Talbott's 2003 book was titled "The Coming Crisis in the Housing Market."
http://www.usnews.com/usnews/biztech/articles/041206/6main.htm
http://www.alternet.org/story/95375/meet_the_economist_who_thinks_we%27re_doomed/

Thursday, September 25, 2008

Working-Class Protest $700 Billion Wall Street Welfare Program. Biggest Bank Failure in US History.



Today, people took to the streets to protest a proposed $700 Billion dollar bailout of the mortgage banking industry.

Congress still has not signed off on the bailout, despite threats from Treasury Secretary Hank Paulsen and later from President Bush, that failure to give a blank check this week would lead to a long recession. Neither Paulsen nor Bush seem very concerned with more than a million working-class people facing foreclosures and bankruptcies in the next year. Neither appears to be interested in reforming the system that created the panic. The Republican plan, in fact, calls for a two-year moratorium on capital gains taxes which would disproportionately help the rich.

In other news, today's demise of Washington Mutual (WaMu) was the largest bank failure in US history. JP Morgan Chase has bought WaMu's assets at a fire sale price while it is assumed that the people will absorb the mortgage banking losses. Rumors of additional corporate failures in the banking, insurance, and auto industries have been circulating the Internet for months.

Wednesday, September 17, 2008

The Neoliberal Business Cycle: Privatizing Profits and Socializing Losses


Fears of more business failures, mergers, and bailouts permeate the Internet today. Law professor Michael Greenberger presents one of the most cogent analyses of the current economic situation on NPR.

http://www.npr.org/templates/story/story.php?storyId=94686428

Monday, September 15, 2008

The Neoliberal Economic Empire

Today Lehman Brothers filed for the largest bankruptcy in US history. The investment firm had a 158-year existence, starting as a profiteer of US slavery (the Southern cotton trade). Lehman was heavily invested in Credit Default Swaps (see 4-1-08 post).

Bank of America, which earlier this year bought failing Countrywide mortgage, also purchased Merrill Lynch. The demise of Lehman Brothers and Merrill Lynch means an additional 50,000 financial workers may lose their jobs. Other US investment banks are said to be unstable.

AIG, the US' largest insurance company is also in financial turmoil, with its stock value decreasing by 68%. AIG was also highly invested in credit default swaps. The insurance company may be looking for help from the Federal Reserve Bank. The Fed has reportedly asked two investment banks, JP Morgan Chase and Goldman Sachs, to lend AIG $70 billion. [Update: Tonight the Federal Reserve bailed out AIG with an $85 Billion dollar loan while reportedly taking control of 80% of the company's assets.]

In lesser news for the neoliberals, more than 24,000 workers at Hewlitt Packard will lose their jobs after taking over EDS. The mass firing increased HP's value.

http://www.npr.org/templates/story/story.php?storyId=94617091
http://www.nytimes.com/2008/09/16/business/16aig.html?_r=1&hp&oref=slogin

Friday, September 12, 2008

Monday, September 8, 2008

The US Business Cycle: CEOs and "Short-Sellers" Get Millions as Businesses Fail

Fannie Mae and Freddie Mac CEOs Richard Mudd (L) and Richard Syron (R)


The US Treasury Department has taken over mortgage bundlers Fannie Mae and Freddie Mac. Though these corporations have been run into the ground by leadership incompetence and/or malfeasance, their CEOs leave with millions in compensation. China is also a winner, as these corporate bonds they hold are now secured. "Short-sellers," those betting for stocks to decline in value, have already profited from the failure, with working-class people again caught holding the bag. Marketwatch reports that more than $1 Trillion in credit default swaps will need to be settled. Forbes states that the taxpayer liability is unknown, but that it may reach $300 Billion.

http://www.answers.com/topic/short-position
http://latimesblogs.latimes.com/money_co/2008/09/today-is-a-huge.html
http://www.marketwatch.com/news/story/gse-bailout-triggers-over-1/story.aspx?guid={0BD9AF95-0034-4309-85FE-03A8B7B77B32}&dist=morenews_ts#comments
http://www.forbes.com/markets/2008/09/08/fannie-freddie-bailout-markets-equity_md_0908markets12.html

Saturday, September 6, 2008

Democracy Should Be For Workers Too

Tens of millions of Americans would like to join a union. But the US government and big business have been in collusion for decades to undermine workers' interests. Corporations also often hire "union avoidance" firms to intimidate workers. With strong unions, and the right to vote union (the EFCA), workers have the ability to fight outsourcing, deskilling, and reductions in medical care.

Thursday, September 4, 2008

Political Myth Making

Myths are not something of the past. They are embedded in our beliefs and visible in our culture, and without a critical education they are often taken for granted. One of the greatest myths in US culture has been that political conservatives favor small government. Except for a small but significant group of libertarians, this idea is patently false. Political conservatives may use the rhetoric of big government to disassemble social investments, but that does not stop them from desiring government largesse and social control.

As imperialists, conservative politicians have expanded government both in size and in social control. The US empire now has 730 bases in more than 50 nations. It also has some form of military presence in more than 140 countries. The US military budget exceeds $400 Billion per year and military costs, past and present, amount to more than half of all federal discretionary spending. More than 40% of all military spending occurs in the US (Russia and China spend about 6% apiece). The numbers are even more significant when one considers the number of corporations and workers who rely on government contracts and who have a vested interest in this empire.




Government surveillance, body searches and limitations on the right to assemble
are now a way of life in the US; many US citizens accept this intrusion as part of the post-911 environment. At the state level, conservative politicians push to fund prisons rather than public colleges. With more than 7 million people under criminal justice control at one time, the US is becoming a land of the guards and the guarded.

http://www.youtube.com/watch?v=4tI7MjK_IeE
http://www.democracynow.org/2008/9/3/amy_goodman_grills_st_paul_police
http://www.crocodyl.org/industries/war_disaster_profiteering

Constructing Greater Social Inequality


Ward Connerly, a highly-compensated spokesman for the so-called "Equal Rights" Agenda.


NPR reports that several elite colleges now cost $50,000 or more per year per student (200k for a four-year program). The yearly amount is more than the US median income for a family of four. Although these schools offer student aid, the report notes a shift from economic need to "merit." Unfortunately NPR didn't question the meaning of "merit," which is socially constructed by those with race and class privilege.

Is this merely news, or a sign of something much greater?

In 1996, California passed Proposition 209 which dismantled affirmative action in UC schools. As a result, scholarship programs for racial minorities were eliminated. Ten years later, Blacks comprised only 3% of the student body. In 2006, Latinos were 36.5% of the state high school graduates but made up only 16.3% of UC freshmen. Asian Americans however are overrepresented in UC schools, outnumbering Whites.

In 2003, California attempted to further dismantle affirmative action with Proposition 54. Ninety-five percent of the contributions to promote Proposition 54 came from seven individuals, all but one from outside the state:

John Moores, Sr., University of California Regents board member/owner San Diego Padres ($400,000)

Rupert Murdoch, head of the Fox News empire ($300,000)

Joseph Coors, Colorado beer baron ($250,000)

William J. Hume, head of the anti-labor Basic American Foods ($200,000)

Kansas City businessman John Uhlmann ($190,000)

Harlan Crow, Dallas financier ($140,000)

Peter Schaeffer, Texas-based investor ($62,703).


Big money from the Scaife Foundation and other neoconservative/neoliberal interests is also being used in 2008 to dismantle affirmative action in Arizona, Nebraska, and Colorado. While national elections are at the forefront, racist and classist initiatives like this can have dramatic effects for generations.

http://www.signonsandiego.com/uniontrib/20061127/news_1n27prop209.html
http://www.sajaforum.org/images/07asiangraphicpop.jpg
http://www.equaljusticesociety.org/research_bigmoney_connerly.html
http://www.pbs.org/now/shows/434/index.html
http://colorado.indymedia.org/node/460

Tuesday, August 12, 2008

Transfer Pricing: One Way Multi-National Corporations Avoid Taxes

According to the Government Accountability Office (GAO), about 28% of large US corporations paid no taxes in 2005. The Washington Post's David Cho reports that Senator "Dorgan and Sen. Carl M. Levin (D-Mich.) requested the report out of concern that some corporations were using "transfer pricing" to reduce their tax bills. The practice allows multi-national companies to transfer goods and assets between internal divisions so they can record income in a jurisdiction with low tax rates."

The SF Chronicle (Carolyn Said) added:

"Adam Hughes, director of federal fiscal policy at OMB Watch, a nonpartisan government accountability watchdog, explained how transfer pricing works."

"A company will incorporate offshore where there are no taxes," he said. "That (parent) company charges the U.S. company lots of money for things like the trademark for the company logo. The U.S. company says, 'I made $50 million, but my stupid parent company charged me $50 million for the logo.' The U.S. company gets to deduct the royalty fees as an expense and move profits to the parent company offshore in a tax-free haven."

"Although the US has one of the highest corporate tax rates in the industrialized world, in actuality, it has one of the lowest rates. "From 2000 to 2005, revenue from federal and state corporate income tax averaged 2.2 percent of the U.S. GDP, compared to an average of 3.4 percent in 30 of its trading-partner countries, according to the Treasury Department."

Wednesday, August 6, 2008

Automating and Covering Up White Collar Crime

Yesterday's papers reported that an international ring of computer hackers, including three US citizens, had been charged for stealing 40 million credit card numbers. The Economic Times reports that "the men targeted at least nine major US retail corporations, including "Marshalls and TJ Maxx; BJ's Wholesale Club; Barnes and Noble; Sports Authority; Office Max and DSW shoe stores." NPR reports that retail stores failed to notify consumers, which violates consumer laws. These crimes undermine confidence in the economy, particularly the Internet. NPR also reports that cyber crime now rivals drug crimes in lucrativeness.

Tuesday, August 5, 2008

Disinformation Leading to War: "The Way of the World"


There were two news stories today that open the window slightly on "the way of the world." The first story, from Politico and the book "The Way of the World: A Story of Truth and Hope in an Age of Extremism" is from Pulitizer Prize author Ron Suskind. Suskind reports that a high-ranking official in the White House ordered a forged letter to justify going to war with Iraq in 2003. Suskind adds that the US secretly resettled the Iraqi intelligence chief, Tahir Jalil Habbush al-Tikriti, to Jordan and paid him $5 million in order to deceive the world about weapons of mass destruction.

On NPR (8-7-08), Suskind states that he has tape recorded his sources and is ready to appear before any Senate or House hearings about these crimes of disinformation.
http://www.npr.org/templates/story/story.php?storyId=93319762

Suskind has also posted a transcript of his interview with a high level CIA contractor Rob Richer.
http://www.ronsuskind.com/thewayoftheworld/transcripts/


The second story: In attempting to find someone to prosecute in the anthrax scare,the Federal Bureau of Investigations coerced a man to provide information on his father, a US Army scientist. The Washington post reports that the FBI offered the man $2.5 million and the sports car of his choice. Although the FBI could not prove the father's role in the anthrax scare, their pressure ended in the scientist's suicide.

http://www.politico.com/news/stories/0808/12308.html

http://www.washingtonpost.com/wp-dyn/content/story/
2008/08/05/ST2008080503796.html

http://www.npr.org/templates/story/story.php?storyId=93319762

Monday, August 4, 2008

The Neoliberal Business Cycle

F. William Engdahl (The Online Journal, 8-5-2008) indicates that the banking situation is much worse than most people imagine, with CitiGroup, once the world's largest bank, having to take billions in funds from Dubai. In addition auto sales showed huge declines last month (Ford down 28%, GM down 18%, Toyota down 21%). Even worse, the Labor Department's U6 unemployment rate has risen to 9.6% and, according to Shadowstats, the actual unemployment rate is estimated at 13.7%.

Of course these "problems" are actually how neoliberal economics functions: to consolidate power and resources and to keep the working class in a position of weakness. This list of US retail shop closings indicates another "problem" with the US economy.

Ann Taylor, closing 117 stores nationwide.

Eddie Bauer to close more stores after closing 27 stores in the first quarter.

Cache, a women’s retailer, is closing 20 to 23 stores this year.

Lane Bryant, Fashion Bug, Catherines, closing 150 stores nationwide

Talbots, J. Jill, closing stores. Talbots will close all 78 of its kids and men’s stores plus another 22 underperforming stores. The 22 stores will be a mix of Talbots women’s and J. Jill.

Gap Inc., closing 85 stores

Foot Locker to close 140 stores

Wickes Furniture is going out of business and closing all of its stores. The 37-year-old retailer that targets middle-income customers, filed for bankruptcy protection last month.

Levitz, the furniture retailer, announced it was going out of business and closing all 76 of its stores in December. The retailer dates back to 1910.

Zales, Piercing Pagoda planned to close 82 stores by July 31 followed by closing another 23 underperforming stores.

Disney Store owner has the right to close 98 stores.

Home Depot, closing 15 stores amid a slumping US economy and housing market. The move will affect 1,300 employees. It is the first time the world’s largest home improvement store chain has ever closed a flagship store.

CompUSA (CLOSED).

Macy’s, nine stores closed

Movie Gallery, video rental company, plans to close 400 of 3,500 Movie Gallery and Hollywood Video stores in addition to the 520 locations the video rental chain closed last fall as part of bankruptcy.

Pacific Sunwear, 153 Demo stores closing.

Pep Boys, 33 stores of auto parts supplier closing.

Sprint Nextel, 125 retail locations to close with 4,000 employees following 5,000 layoffs last year.

J. C. Penney, Lowe’s and Office Depot are all scaling back

Ethan Allen Interiors, plans to close 12 of 300 stores to cut costs.

Wilsons the Leather Experts,, closing 158 stores.

Bombay Company to close all 384 U.S.-based Bombay Company stores.

KB Toys, closing 356 stores around the United States as part of its bankruptcy reorganization.

Dillard’s Inc. will close another six stores this year.

http://onlinejournal.com/artman/publish/article_3583.shtml

Wednesday, July 30, 2008

Domestic Surveillance as an American Way of Life

The US government has established "fusion centers" to join various federal and local police agencies. The ACLU argues that these centers have been used to systematically spy on citizens who do not commit crimes but who oppose war and the Death Penalty.

http://www.washingtonpost.com/wp-dyn/content/article/2008/07/31/
AR2008073101505.html?nav=hcmodule

http://www.commondreams.org/news2008/0729-17.htm

Wednesday, July 23, 2008

Socializing Kids for Combat


Michael Reagan of Truthout (July 23, 2008) writes of the US Army's shameless attempts to recruit children through its video game and website. According to Reagan, the game simulates training and combat, minus the moral dilemmas of killing other humans and the horror and nightmares experienced by soldiers and civilians who experience war first hand.

Hey DOD, how about a PTSD video game?

http://www.truthout.org/article/us-military-recruits-children

Sunday, July 13, 2008

Freddie Mac and Fannie Mae: More Corporate Welfare Over the Weekend

The Federal Reserve, not surprisingly, has bailed out Freddie Mac and Fannie Mae by allowing the two corporations to borrow money from its "discount window" (Dawn Kopecki, Bloomberg, 7-14-08). The Treasury Department was also involved in getting "assurances" that Freddie Mac's short-term debt offerings "would go off without a hitch" (Stephen Laboton, NY Times, 7-14-08).

Both moves occurred before the US stock market opened on Monday.

A more telling understanding of the situation can be found from the readers of the NY Times article.

http://community.nytimes.com/article/comments/2008/07/14/
washington/14fannie.html

Saturday, July 12, 2008

IndyMac Bank Failure Misses News Cycle

Immediately after the stock market closed for the weekend (7-12-2008), the Office of Thrift Supervision (OTS) reported the federal takeover of IndyMac. The seizure came after a run on the California-based bank. According to the FDIC this was the third largest bank takeover in US history. At least 3800 employees will be sacked.

IndyMac was a spinoff of Countrywide Financial (Angelo Mozilo and David Loeb) and was heavily invested in high-risk mortgages.

The event came in light of news that Freddie Mac and Fannie Mae, the largest US mortgage-based security firms, were faltering. Julie Creswell (NY Times 7-13-08) reported that both institutions hired high level politicos for years and bought off activist groups by donating to their charities.

http://www.nytimes.com/2008/07/13/business/
13lend.html?pagewanted=2&ei=5087&em&en=b241ddc36df57dec&ex=1216094400

Friday, July 11, 2008

Understanding US Inequality and Economics


Demos.org is a fine source for statistics on US economic conditions, with an emphasis on inequality. The website includes charts on wages, income mobility, wealth, CEO wealth, and personal savings.

http://www.demos.org/inequality/numbers.cfm

Wednesday, July 2, 2008

White Collar Crime Narrative


Samuel Israel III, fugitive from justice and hedge fund swindler, surrendered to law enforcement today. Israel was sentenced to 20 years in prison for defrauding clients of $309,000,000 between 1998 and 2005. He then faked his death in order to escape imprisonment. Israel went as far as co-creating a bogus accounting firm to certify false financial statements.

There is little or no mention of the immediate victims, who were other rich investors. The ultimate victims, however, are the people.

Israel's lawyer's sentencing letter to the judge is a window into the white collar criminal mind. The letter (URL below) even states that Israel is "the victim" rather than the predator (p.28). Note that, in a way, this white collar criminal is even less honorable than the typical street thug, preferring to blame his crimies rather than accepting the punishment. The letter makes no mention of Israel's great grandfather, Leon Israel, who was also a white-collar criminal (NY Times, April 29,1920).

Note also the unpublished paper, titled "the Subjective Experience of Punishment" beginning on page 70. In it, Professor Adam Kolber, claims that "sensitive" (e.g. rich people) should be given breaks in sentencing over "insensitive" people (e.g. the lesser classes).

Kolber has also written on the ethics of "therapeutic forgetting," which would be used on soldiers to forget the atrocities of war.

The sentencing paper, forthcoming in the Columbia Law Review, was sponsored by the Orwellian Princeton Center for Human Values. Of note, the Center for Human Values, funded by the Mellons and Rockefellers, has also promoted pre-emptive war.

http://graphics8.nytimes.com/packages/pdf/
business/2008/06/14Bayou-doc2.pdf

Friday, June 27, 2008

Work Injury? What Work Injury?


Bill Moyers' Journal (June 27, 2008) reported OSHA's lack of oversight in the poultry industry. According to the Charlotte Observer, OSHA inspections have been reduced to the lowest levels in 15 years, siding with corporations over their workers. Observer reporter Ames Alexander states "workers are making 20,000 cuts a day, highly prone to repetitive motion kinds of problems like carpal tunnel. They're working with sharp knives, around dangerous chemicals and equipment." Yet these injuries have been reduced or eliminated from OSHA reports since 2002.

Tuesday, June 24, 2008

House Resolution 362 to Provoke Iran War


The US House is close to voting on Resolution 362 to confront Iran with a military blockade in the Strait of Hormuz. The story has received little mainstream attention (CBS News reported on the Resolution on June 24).

The Senate version, Resolution 580, is also in the works. The sponsor of the Senate Resolution is Democrat Evan Bayh. So much for Democrats being anti-war. Although the Resolutions do not authorize use of force, they put Iran and US troops in positions where conflict appears more likely. Just Foreign Policy has a site where you can send an email protest to your representative.

http://capwiz.com/justforeignpolicy/issues/alert/?alertid=11518951

[Update: Seymour Hersch's article about spending on US covert ops in Iran appeared in the New Yorker, June 30th]

http://www.newyorker.com/reporting/2008/07/07/080707fa_fact_hersh

Veterans Used as Guinea Pigs in Drug Experiments

ABC News reports that the US Veterans Administration waited months before notifying vets that the drugs they were given for smoking cessation were associated with psychiatric side effects. The vets in the study had PTSD and were trying to quit smoking. According to WebMD, the 1 year efficacy rate for Chantix is 14%. The VA is continuing the study for Chantix despite the warnings.

Chantix is a trademark of Pfizer.

George Will Favors Prison-Industrial Complex, Suggests Prisons Are Better Investments than Public Universities


George Will’s editorial (“Prison time is about crime, not about race”, Washington Post, June 22, 2008) is lacking not only in compassion, but in intellectual depth and vision. His hypothesis that prisons may have greater social value than public universities is equally disturbing.

Race and class are key factors in every aspect of the justice system, from policing to post-conviction. Race and class shape what we define as crime, who we define as criminals, and how the criminal justice system is administered.

Except in a few sensational news accounts (Enron, Martha Stewart, Jack Abramoff, and now Bear Stearns), white collar criminals are rarely perceived as crooks, though their damage to society far outweighs street crime. College students aren’t typically arrested and thrown in jail for drug possession or intent to sell, though drug use is common on college campuses. Black and Latino youth, on the other hand, are profiled and questioned by the police as a matter of course, creating an atmosphere akin to a military occupation.

As for reducing street crime, there are better social investment strategies than spending billions on prisons. The Rand Corporation, for example, has prescribed child abuse prevention, better education, and social support programs as better ways to reduce crime. Given that the roots of street crime are related to economic conditions, it would seem logical that decent paying jobs would also reduce certain types of crime. Whether the public is willing to make such social investments may depend on whether it is informed by people with vision and intellect or deceived by media people like Mr. Will.

http://www.washingtonpost.com/wp-dyn/content/article/2008/06/20/AR2008062002276.html

Monday, June 23, 2008

TSA and the Expanding Police State

More and more America seems to be spiraling into a police state. According to conservative columnist Walter E. Williams (June 2008), the Transportation Security Administration (TSA) has employed 500 Behavior Detection Officers. The role of these officials is to examine passengers for signs of 'bad intentions.' These cues may include 'micro-impressions' such as fear and disgust. Williams adds that passengers who deter searches are subject to fines of $1500.

TSA's own website reports that the agency has also "enhanced" its airport pat down searches to include crotch areas.

Tuesday, June 17, 2008

7.2 Million Under Correctional Supervision

From the US Department of Justice:

7.2 million people were under correctional supervision in the US (probation, jail, prison, parole) in 2006. Approximately 1.8 million were under supervision in 1980.

Pentagon Torture Chief Joins Chevron



Anne Flaherty (AP) reports from the Senate Armed Forces Committee that William "Jim" Haynes, the Pentagon's General Counsel, sought the assistance of military psychologists to plan methods of torture and degradation (use of dogs, stress positions and forced nudity) later approved by Donald Rumsfeld in December 2002. The Armed Forces Committee noted that military lawyers protested the strategies to the Joint Chiefs of Staff but the objections were ignored. Sanctioned torture is morally wrong. It also lets others know that these tactics are legitimate.

Haynes now serves as chief counsel to the Chevron Corporation. Given Chevron's human rights record (see 3-25-08 post), this would seem a likely fit.

Sunday, June 15, 2008

The Dehumanizing Effects of War and Occupation

As long as the US does not rely on robots for military operations they will have to use the working class like robots--or worse. The only thing is that soldiers feel fatigue, they see and feel the inhumanity and the futility of war. And the military response is to give them meds and tell them to "suck it up" as they face another tour.

According to a Time Magazine report (6-5-08, "America's Medicated Army") "about 12% of combat troops in Iraq and 17% of those in Afghanistan are taking prescription antidepressants or sleeping pills to help them cope." The report does not indicate the number of soldiers who self medicate with alcohol and illegal drugs.

According to the Time report stress illness begins "with mild anxiety and irritability, difficulty sleeping, and growing feelings of apathy and pessimism. As the condition worsens, the feelings last longer and can come to include panic, rage, uncontrolled shaking and temporary paralysis." The Pentagon states that only 10% of soldiers experience long-term "stress illness", but who can trust the military to be honest and objective?

What will be the long-term effects on these people, and on American society? According to the Time report "the symptoms often continue back home, playing a key role in broken marriages, suicides and psychiatric breakdowns."

Thursday, June 12, 2008

Enemy to the Working Class


Richard Berman is a lobbyist for the restaurant and beverage industry and an enemy of the working class, with all the ethics of a drug dealer. According to the NY Times (2-14-06), Mr. Berman (aka "Dr. Evil") has:*Lobbied against the minimum wage,*Argued that drinking soda does not contribute to diabetes,*Has fought Mothers Against Drunk Drivers against tightening alcohol limits for drivers,*Has organized an anti-union website called union facts.com

Monday, June 9, 2008

The Stacked Court


The US Supreme Court made two more rulings against the interests of the working class. In Engquist v. Oregon Department of Agriculture, the court decided that a public employee was not protected against individual discrimination based on arbitrary, vindictive, and malicious reasons. The so-called High Court also agreed to hear an appeal by big tobacco's Phillip Morris.

Sunday, June 8, 2008

Industrial Disasters

60 Minutes' Scott Pelley investigated the lack of oversight by OSHA in preventing industrial fires and worker deaths. Government has a key role as a check and balance against corporate greed and indifference, unless it becomes the lapdog for industry.

Approximately 5,000 to 6,000 American workers die each year in work-related accidents. Many more die to work-related illnesses, estimated at 50,000 to 70,000 per year (Reiman, 2001). According to David Barstow (NYT, 12-22-03) few people are prosecuted even when the action clearly violated safety regulations.


Friday, June 6, 2008

Maximizing Profits=Switching Up On the Con


Sounds like top US financial institutions--Goldman Sachs (GS) and Morgan Stanley (MS) are taking the opportunity to recoup their losses from the recent mortgage banking crisis, by speculating on oil. Not surprisingly, Morgan Stanley's fortune tellers predict prices will rise to $150 by July 4th; shills for Goldman Sachs say prices could soon rise to $200 a barrel.

According to CNN.com:

"Commodities markets often turn on proprietary information known to a limited number people. An oil company can take advantage of inside information about its own production outlook when it makes trades. However, if traders intentionally create an artificial price and use it to make money, market manipulation charges may arise."

"Goldman Sachs and Morgan Stanley are major players in the world of commodities, which range from trading to hedging and even owning electricity plants and oil barges. In the first quarter, Morgan Stanley calculated that it took more risks in commodities on a daily basis than in stocks."

[Editors note: According to the House Energy and Commerce Committee, speculators make up 71% of NYMEX oil futures shares, up from 37% in 2000.]

Tuesday, June 3, 2008

The Demise of the US Industrial Middle-Class


Louis Uchitelle (NY Times, 4-20-2008) writes about the steady erosion of wages in US industrial labor, beginning with the steel industry in the 1970s and ending with US automakers replacing union workers with "second tier" hires. GM's recent move to eliminate union workers is only one step in a long race to the bottom. The author adds that use of temp workers, outsourcing, and shifting production to nonunion plants are common corporate tactics.

College promises to be the route back to middle class status for some--while others will sink into the lower class (IMF economists refer to this as "short-term adjustment costs"). Uchitelle adds "that roughly 15 percent of college-educated workers find themselves in jobs for which they are overqualified, the Economic Policy Institute reports, and many of these jobs pay less than $20 an hour." (Note: I would add that tactics used to undermine industrial laborers can be used effectively against white and pink collar labor also.)

In "Bad Money: Reckless Finance, Failed Politics, and the Global Crisis of American Capitalism", Kevin Phillips argues that the US reliance on capital markets instead of manufacturing is a key sign the US is losing dominance in the world economy. Guess we'll have to wait and see.

Thursday, May 29, 2008

What's Good for GM

Bloomberg.com reports that General Motors is shedding another 19,000 US workers. According to Bloomberg, "the departures will allow GM to install new employees who will be paid about $14 an hour, about half the wage of the current unionized workforce, while reducing health-care and retirement benefits." In February, GM offered retirement and buyouts to all of its 74,000 UAW employees.

Wednesday, May 21, 2008

A Graph Speaks a Thousand Words

Zfacts.com has a wide array of graphs and statistics relating to progressive issues.

Tuesday, May 20, 2008

Timing Our Race to the Bottom

Richard Sennett's "The Culture of the New Capitalism" (Yale University Press) presents some key terms and ideas about the new global economy that validates the experiences of the rightfully fearful American working-class:

Impatient Capital: Cutthroat investors seek "short-term rather than long-term results." The results: American pension funds, for example, held stocks on average from 46 months in 1965 to less than 4 months by 2000. Temp workers with few benefits are ubiquitous. Impatient capital results in companies and workers who have little loyalty for each other.

Skills Extinction: Skills are non-durable, and must be replaced, often several times over a lifetime. Failure to adapt invokes "the specter of uselessness."

Ressentiment: "A cluster of emotions, principally the belief that ordinary people who have played by the rules have not been dealt with fairly."

Gold-plating: Political parties engage in trivial differences instead of profound structural issues. Sennett states that the selling of politicians is similar to selling soap.

Sunday, May 18, 2008

The Devil's Invisible Hand


This American Life (5-9-08, show #355) aired a one-hour radio episode on the mortgage banking crisis and the global pool of money. In this show the authors follow the international trail of money and greed that contributed to America's economic malaise.

Monday, May 12, 2008

More Information on the Walking Wounded and the Costs of War

According to Foreign Policy in Focus (May 9, 2008):

"...The Pentagon regularly reports on the numbers of American troops "wounded" in Iraq (currently at 31,948) but neglects to mention that it has two other categories "injured" (10,180) and "ill" (28,451). All three of these categories represent soldiers who are so damaged physically they have to be medically evacuated to Germany for treatment, but by splitting the numbers up the sense of casualties down the public consciousness."

"287,790 Iraq and Afghanistan war veterans "filed a disability claim with the Veterans Administration as of March 25th [2008]. That figure was not announced to the public at a news conference, but obtained by Veterans for Common Sense using the Freedom of Information Act."

"According to an April 2008 study by the Rand Corporation, 300,000 Iraq and Afghanistan war veterans currently suffer from post traumatic stress disorder or major depression. Another 320,000 suffer from traumatic brain injury, physical brain damage. A majority are not receiving help from the Pentagon and VA system which are more concerned with concealing unpleasant facts than they are with providing care."

Saturday, May 10, 2008

How the rich get richer and the working class die

A NY Times editorial on 3-9-08 revealed that military contractors like KBR have been dodging hundreds of millions in payroll taxes by using offshore shell companies in the Cayman Islands. The Times notes that this strategy is currently legal, but that Congress was working on closing the loopholes.

Thursday, May 1, 2008

NNDB Database (nndb.com)

The NNDB website is an Internet source that "documents the connections between people, many of which are not always obvious." Go to Bill O'Reilly, for example, and you'll find a link for Draft Deferment: Vietnam. While there are a diverse number of people on the list, the list includes the following Vietnam era "chickenhawks":

Gary Bauer (Family Research Council)
Dick Cheney
Steve Forbes
Newt Gingrich
Rudy Guliani
Brit Hume (Fox analyst)
Alan Keyes
Scooter Libby
Joe Lieberman
Rush Limbaugh
Mitt Romney
Karl Rove
John Stossel (ABC commentator)
Clarence Thomas
George Will
Paul Wolfowitz

Thursday, April 24, 2008

Comparing (Rotten) Apples and Oranges


Shadowstats.com contains several series of data about the US economy, including alternative measures to GDP, CPI, and unemployment. These revised statistics are based on maintaining the same definitions over time. For example, housing and fuel are today excluded from the Consumer Price Index, but they once were part of the formula. Using this alternative to CPI reveals an inflation rate of about 12%. The alternative measures also show a flat line in money supply, 13% unemployment rate and a declining GDP.

Wednesday, April 23, 2008

Betting on Misery

Steve Fraser and Tom Englehardt present a critical historical analysis of this Second Gilded Age in America, comparing the brutality and anti-democratic nature of the late 1800's to today. Some notable excerpts:

"Think of it as gilding the pain. Last year, hedge fund manager John Paulson of Paulson & Co. hauled in a nifty $3.7 billion. (Yes, you read that right.) Mainly, he did so, according to the Wall Street Journal, "by shorting, or betting against, subprime mortgage securities and collateralized debt obligations." And he wasn't alone. Hedge fund money-maker Philip Falcone of Harbinger Capital Partners raked in a comparatively measly $1.7 billion in 2007, also by shorting subprime mortgages. These are fortunes beyond imagining, made in no time at all by betting on the pure misery of others. Think of them as Las Vegas with a mean streak a mile wide."

...

"However, the wheel turns. The capitalism of the Second Gilded Age now faces a systemic crisis and, under the pressure of impending disaster, may be headed back to the future. Old-fashioned poverty is making a comeback. Arguably, the global economy, including its American branch, is increasingly a sweatshop economy. There is no denying that brute fact in Thailand, China, Vietnam, Central America, Bangladesh, and dozens of other countries and regions that serve as platforms for primitive accumulation. Hundreds of millions of peasants have become proletarians virtually overnight.

Here at home, something analogous has been happening, but with an ironic difference and bearing within it a new historic opportunity. One might call it the unhorsing of the middle class.

During the first Gilded Age, the sweatshop seemed a noxious aberration. It lawlessly offered irregular employment at sub-standard wages for interminable hours. It was ordinarily housed helter-skelter in a make-shift workshop that would be here today, gone tomorrow. It was an underground enterprise that regularly absconded with its workers' paychecks and made chiseling them out of their due into an art form.

Today, what once seemed abnormal no longer does. The planet's peak corporations depend on this system. They have thrived on it. True enough, it has also encouraged the proliferation of petty enterprises -- sub-contractors, consulting firms, domestic service companies -- fertilizing the soil in which our age of democratic capitalism is rooted. But the ubiquity of the sweated economy promises to alter the nation's political chemistry.

Many of the newly flexible proletarians working for Wal-Mart, for auto parts or construction company sub-contractors, on the phones at direct mail call centers, behind the counters at mass market retailers, earn a dwindling percentage of what they used to. Even new hires at the Big Three automobile manufacturers will now make a smaller hourly wage than their grandfathers did in 1948. So too, the relative job security such employees once enjoyed is gone, leaving them vulnerable to the "lean and mean" dictates of the new capitalism: double or triple work loads; or, even worse, part-time work, work always shadowed by indignity and fear; or, worse yet, no work at all.

Meanwhile, the white collar Tomorrowland of "free agent" techies, software engineers, and the like -- not to mention a whole endangered species of middle management -- lives a precarious existence, under intense stress, chronically anticipating the next round of lay-offs. Yet many of them were once upon a time members in good standing of the "middle class." Now, they find themselves on the down escalator, descending into a despised state no one could mistake for middle class life.

"Flexible accumulation" joins this dispossession of the middle class to the super-exploitation of millions who never laid claim to that status. Many of these sweated workers are women, laboring away as home health care aides, in the food services industry, in meat processing plants, at hotels and restaurants and hospitals, because the arithmetic of "flexible accumulation" demands two workers to add up to the livable family wage not so long ago brought home by a single wage earner.

Millions more are immigrants, legal as well as undocumented, from all over the world. They live, virtually defenseless, in a twilight underworld of illegality and prejudice. Thanks to all this, the category of the "working poor" has reentered our public vocabulary. Once again, as during the first Gilded Age, poverty seems a function of exploitation at work, not only the lot of those excluded from work."

Sunday, April 20, 2008

Reason and Politics in These Times

Susan Jacoby has written a thought-provoking piece on reason and politics in today's LA Times. Jacoby notes that there have been times and spaces in American history where people were drawn to opposing views, and that this environment was a key component of intellectual progress and uplift. She laments that this ethos is largely invisible today.

Jacoby notes that "when Thomas Henry Huxley, the British naturalist who popularized Darwin's theory of evolution, came to the U.S. in 1876, he spoke to standing-room-only audiences, even though many of his listeners were genuinely shocked by his views."

While Jacoby's historical analysis is overly optimistic about the past, ignoring America's repression of voices, she does bring out an important point, and that is, to quote Jacoby, "This spirit of inquiry, which demands firsthand evidence and does not trivialize opposing points of view, is essential to a society's intellectual and political health."

Thursday, April 17, 2008

Walking Wounded



The LA Times reports a recent Rand Study estimating 300,000 US vets from Iraq and Afghanistan are suffering from depression or PTSD.

From the LA Times:

In addition to current PTSD rates, the Rand study found that 19.5% of people who had served in Iraq or Afghanistan suffered a concussion or other traumatic brain injury during their combat tour, a number similar to Army estimates.

Taken together, the study shows that 31% of those who have served in combat have suffered from brain injury, stress disorder, or both.

Combat-related mental ailments and stress can lead to suicide, homelessness and physical health problems. But more mundane disorders can have long-term social consequences.

"These conditions can impair relationships, disrupt marriages, aggravate the difficulties of parenting, and cause problems in children that may extend the consequences of combat trauma across generations," the study said.

According to Rand:

"Many service members said they do not seek treatment for psychological illnesses because they fear it will harm their careers. But even among those who do seek help for PTSD or major depression, only about half receive treatment that researchers consider "minimally adequate" for their illnesses."

Declining Interest in Joining the US Military



NPR reports that interest in joining the Army has declined significantly since 2001, and that to meet quotas, the US military has allowed more waivers. According to a Department of the Army survey, interest in joining the military between November 2001 and June 2007 dropped from 37% to 15% in Hispanics, and from 20-22% to less than 10% in Blacks and Whites. According to the report, the impact on granting moral and health waivers is mixed. Because there is no recent data, the impact of the economic downturn and the so-called success of the surge on recruiting have not been documented.

Friday, April 11, 2008

Poverty and Welfare (for the rich)

Bill Moyers has three interesting pieces on the April 11, 2008 edition, the first on the increasing number of Americans going to food banks, the second on the use of farm subsidies for rich people who, in some cases, do not even farm. The third piece, an interview with David Beckman, puts the first two into context.

From The Journal:


An economist and minister, he [Beckman]spent 15 years at the World Bank overseeing projects to end poverty. For the last 15 years he's been president of Bread for the World, a Washington based coalition that advocates changing farm policies for the purpose of eliminating hunger. Welcome, David, back to The Journal.


BILL MOYERS: We've just seen in this broadcast two different reports. One on hungry people lining up for food stamps, going to the food pantries. Then we saw this report done with the Washington Post on abusive farm subsidies. How do you explain that contradiction?

DAVID BECKMANN:The main thing is that the people who are getting- who have their hands in the cookie jar are well organized. And according to the Wall Street Journal, they spent eighty million dollars last year lobbying Congress to defend those subsidies to affluent people.

DAVID BECKMANN: Commodity growers, the corn growers, the cotton growers.

BILL MOYERS: Rice growers. We saw rice growers in that film.

DAVID BECKMANN: Absolutely. So they're well organized. A group of church and environmental groups went to see Senator Reid, the majority leader of the Senate, about this issue. He came in and the first thing he said is, "Look, I've been here 35 years." He said, "I think the two best organized interests in the United States are the insurance companies and the commodity groups." He said they have very powerful friends on both sides of the aisle. It's going to be very difficult for us to do anything about this.


BILL MOYERS: But you're saying our system is so fouled up, it can't do the right thing?

DAVID BECKMANN: Is that a surprise?

Tuesday, April 8, 2008

More Corporate Welfare

Time magazine reports that the Federal Reserve is loaning $50 million to "cash-strapped banks." Since December 2007, the Fed has "pumped $310 billion in short-term loans into the nation's banking system." According to the Asia Times this scheme called "the New Term Auction Facility (TAF) has allowed large banks to borrow massive amounts of cash against collateral that can't be sold for close to face value."

Friday, April 4, 2008

Shills

Should citizens trust public officials to work in their interests? Dana Milbank (The Washington Post) presented some important information on the Senate Banking Committee's investigation of the investment banking meltdown. Milbank noted that Banking Committee members had received more than $20 million in campaign contributions from this sector, including:

Chris Dodd (D-$5,796,000)
Evan Bayh (D-$1,582,000)
Chuck Schumer (D-$6,162,000)

Inter Press Service (4-7-08) also reported that:

"Members of Congress invested nearly 196 million dollars of their own money in companies that receive hundreds of millions of dollars a day from Pentagon contracts to provide goods and services to U.S. armed forces, say nonpartisan watchdog groups." Congressional investors included John Kerry and Joe Lieberman.

Tuesday, April 1, 2008

and the Rich Get Richer

The Congressional Budget Office is projecting all-time high numbers of people using food stamps by 2009.

Not an April Fool


Marketplace has a short radio spot on Credit Default Swaps, a derivative in the relatively unregulated shadow economy. In 2003, Warren Buffet called these speculative derivatives "financial weapons of mass destruction (BBC 3-14-03)." Although Credit Default Swaps are a $45 Trillion market, few people understand how they work. Investment expert Christopher Whalen states that JP Morgan's buyout of Bear Stearns was made because Bear Stearns had $2.5 Trillion in these derivatives, and JP Morgan, another big investor in Credit Default Swaps, could not afford to let its fellow investment bank go down.

Listen to minutes 8:00 to 12:09 for Whalen's analysis.

Sunday, March 30, 2008

This is America?



60 Minutes presented a story on a German citizen, Murat Kurnaz, who was tortured by the US in the "war on terror" and detained for five years, though they had no evidence against him.

Friday, March 28, 2008

The Endless War of Divide and Conquer


It's hard to understand how the US occupation of Iraq will lead to lasting peace and democracy--if that ever was a real goal. Rather, the US continues on its strategy of divide and conquer, pitting wealthy and powerful Shiites (The Islamic Supreme Council of Iraq and the Badr Brigade) against the poor (Sadr's Mahdi Army). Chris Floyd of the Baltimore Chronicle states:

"The Bush regime – which is intimately involved in every step of the Basra operations, despite its rote denials – is trying to keep the war boiling on a high simmer. This is the only option it has left to achieve its primary war aim: a permanent U.S. military presence in Iraq."

Floyd adds:

"The only possible move that could even potentially defuse the situation at this point is the total withdrawal of American forces. This could, perhaps, compel the various Iraqi factions to come to some accommodation. It is unlikely that such an accommodation would be reached without bloodshed; but blood is being shed copiously now. And as along as the American presence remains, as an artificial, alien – and ever-aggravating – factor, skewing the playing field, taking sides, killing people, and serving as a focus and fomenter of nationalist rage (and a handy pretext for avoiding accommodation), the situation will only grow worse. And certainly no other possible resolution – internal negotiation, a UN or pan-Arab peacekeeping force, etc. – will ever be possible as long as American forces remain in Iraq.

But let us be clear. The withdrawal of American forces from Iraq is not a "good" solution. It will lead to blood and suffering. But there are no good solutions to what Bush and his willing executioners in Congress, the media and Establishment have wrought in Iraq. There were never any "good" solutions. All hope, all potential for a "good" solution evaporated in the very instant that the first bomb fell on March 19, 2003. From that moment, the only thing – the only thing – that one could hope for and work for has been some kind of mitigation of the murderous consequences of this abominable crime."

Wednesday, March 26, 2008

Understanding "Externalities"

One of the essential critiques of "free market capitalism" is the understanding of externalities. From this position, corporations have no ethic to do anything other than maximize profits, and therefore try their best to shift their costs to others. Some good websites to check out:

http://www.externalities.net/

Chronicling the Rhetoric that Led to War


The Center for Public Integrity has done a great service by chronicling the rhetoric and false statements leading to the Iraq war:

http://www.publicintegrity.org/WarCard/
Default.aspx?source=home&context=overview&id=945

Consider, for example, these false public statements made in the run-up to war:

* On August 26, 2002, in an address to the national convention of the Veteran of Foreign Wars, Cheney flatly declared: "Simply stated, there is no doubt that Saddam Hussein now has weapons of mass destruction. There is no doubt he is amassing them to use against our friends, against our allies, and against us." In fact, former CIA Director George Tenet later recalled, Cheney's assertions went well beyond his agency's assessments at the time. Another CIA official, referring to the same speech, told journalist Ron Suskind, "Our reaction was, 'Where is he getting this stuff from?' "

* In the closing days of September 2002, with a congressional vote fast approaching on authorizing the use of military force in Iraq, Bush told the nation in his weekly radio address: "The Iraqi regime possesses biological and chemical weapons, is rebuilding the facilities to make more and, according to the British government, could launch a biological or chemical attack in as little as 45 minutes after the order is given. . . . This regime is seeking a nuclear bomb, and with fissile material could build one within a year." A few days later, similar findings were also included in a much-hurried National Intelligence Estimate on Iraq's weapons of mass destruction — an analysis that hadn't been done in years, as the intelligence community had deemed it unnecessary and the White House hadn't requested it.

* In July 2002, Rumsfeld had a one-word answer for reporters who asked whether Iraq had relationships with Al Qaeda terrorists: "Sure." In fact, an assessment issued that same month by the Defense Intelligence Agency (and confirmed weeks later by CIA Director Tenet) found an absence of "compelling evidence demonstrating direct cooperation between the government of Iraq and Al Qaeda." What's more, an earlier DIA assessment said that "the nature of the regime's relationship with Al Qaeda is unclear."

* On May 29, 2003, in an interview with Polish TV, President Bush declared: "We found the weapons of mass destruction. We found biological laboratories." But as journalist Bob Woodward reported in State of Denial, days earlier a team of civilian experts dispatched to examine the two mobile labs found in Iraq had concluded in a field report that the labs were not for biological weapons. The team's final report, completed the following month, concluded that the labs had probably been used to manufacture hydrogen for weather balloons.

* On January 28, 2003, in his annual State of the Union address, Bush asserted: "The British government has learned that Saddam Hussein recently sought significant quantities of uranium from Africa. Our intelligence sources tell us that he has attempted to purchase high-strength aluminum tubes suitable for nuclear weapons production." Two weeks earlier, an analyst with the State Department's Bureau of Intelligence and Research sent an email to colleagues in the intelligence community laying out why he believed the uranium-purchase agreement "probably is a hoax."

* On February 5, 2003, in an address to the United Nations Security Council, Powell said: "What we're giving you are facts and conclusions based on solid intelligence. I will cite some examples, and these are from human sources." As it turned out, however, two of the main human sources to which Powell referred had provided false information. One was an Iraqi con artist, code-named "Curveball," whom American intelligence officials were dubious about and in fact had never even spoken to. The other was an Al Qaeda detainee, Ibn al-Sheikh al-Libi, who had reportedly been sent to Eqypt by the CIA and tortured and who later recanted the information he had provided. Libi told the CIA in January 2004 that he had "decided he would fabricate any information interrogators wanted in order to gain better treatment and avoid being handed over to [a foreign government]."

The false statements dramatically increased in August 2002, with congressional consideration of a war resolution, then escalated through the mid-term elections and spiked even higher from January 2003 to the eve of the invasion.

It was during those critical weeks in early 2003 that the president delivered his State of the Union address and Powell delivered his memorable U.N. presentation. For all 935 false statements, including when and where they occurred, go to the search page for this project; the methodology used for this analysis is explained here.

In addition to their patently false pronouncements, Bush and these seven top officials also made hundreds of other statements in the two years after 9/11 in which they implied that Iraq had weapons of mass destruction or links to Al Qaeda. Other administration higher-ups, joined by Pentagon officials and Republican leaders in Congress, also routinely sounded false war alarms in the Washington echo chamber.