Robalini's Note: Putting conditions on multi-million dollar bonuses to Wall Street executives? Ridiculous. Oh, but we do need random drug-testing of the poor who receive government help...
http://apnews.myway.com/article/20090326/D975MFE80.html
States consider drug tests for welfare recipients
Mar 26, 2009
By TOM BREEN
CHARLESTON, W.Va. (AP) - Want government assistance? Just say no to drugs.
Lawmakers in at least eight states want recipients of food stamps, unemployment benefits or welfare to submit to random drug testing.
The effort comes as more Americans turn to these safety nets to ride out the recession. Poverty and civil liberties advocates fear the strategy could backfire, discouraging some people from seeking financial aid and making already desperate situations worse.
Those in favor of the drug tests say they are motivated out of a concern for their constituents' health and ability to put themselves on more solid financial footing once the economy rebounds. But proponents concede they also want to send a message: you don't get something for nothing.
"Nobody's being forced into these assistance programs," said Craig Blair, a Republican in the West Viginia Legislature who has created a Web site - notwithmytaxdollars.com - that bears a bobble-headed likeness of himself advocating this position. "If so many jobs require random drug tests these days, why not these benefits?"
Blair is proposing the most comprehensive measure in the country, as it would apply to anyone applying for food stamps, unemployment compensation or the federal programs usually known as "welfare": Temporary Assistance for Needy Families and Women, Infants and Children.
Lawmakers in other states are offering similar, but more modest proposals.
On Wednesday, the Kansas House of Representatives approved a measure mandating drug testing for the 14,000 or so people getting cash assistance from the state, which now goes before the state senate. In February, the Oklahoma Senate unanimously passed a measure that would require drug testing as a condition of receiving TANF benefits, and similar bills have been introduced in Missouri and Hawaii. A Florida senator has proposed a bill linking unemployment compensation to drug testing, and a member of Minnesota's House of Representatives has a bill requiring drug tests of people who get public assistance under a state program there.
A January attempt in the Arizona Senate to establish such a law failed.
In the past, such efforts have been stymied by legal and cost concerns, said Christine Nelson, a program manager with the National Conference of State Legislatures. But states' bigger fiscal crises, and the surging demand for public assistance, could change that.
"It's an example of where you could cut costs at the expense of a segment of society that's least able to defend themselves," said Frank Crabtree, executive director of the West Virginia chapter of the American Civil Liberties Union.
Drug testing is not the only restriction envisioned for people receiving public assistance: a bill in the Tennessee Legislature would cap lottery winnings for recipients at $600.
There seems to be no coordinated move around the country to push these bills, and similar proposals have arisen periodically since federal welfare reform in the 1990s. But the appearance of a cluster of such proposals in the midst of the recession shows lawmakers are newly engaged about who is getting public assistance.
Particularly troubling to some policy analysts is the drive to drug test people collecting unemployment insurance, whose numbers nationwide now exceed 5.4 million, the highest total on records dating back to 1967.
"It doesn't seem like the kind of thing to bring up during a recession," said Ron Haskins, a senior fellow at the Brookings Institution. "People who are unemployed, who have lost their job, that's a sympathetic group. Americans are tuned into that, because they're worried they'll be next."
Indeed, these proposals are coming at a time when more Americans find themselves in need of public assistance.
Although the number of TANF recipients has stayed relatively stable at 3.8 million in the last year, claims for unemployment benefits and food stamps have soared.
In December, more than 31.7 million Americans were receiving food stamp benefits, compared with 27.5 million the year before.
The link between public assistance and drug testing stems from the Congressional overhaul of welfare in the 1990s, which allowed states to implement drug testing as a condition of receiving help.
But a federal court struck down a Michigan law that would have allowed for "random, suspicionless" testing, saying it violated the 4th Amendment's protections against unreasonable search and seizure, said Liz Schott, a senior fellow at the Center on Budget and Policy Priorities.
At least six states - Indiana, Massachusetts, Minnesota, New Jersey, Wisconsin and Virginia - tie eligibility for some public assistance to drug testing for convicted felons or parolees, according to the NCSL.
Nelson said programs that screen welfare applicants by assigning them to case workers for interviews have shown some success without the need for drug tests. These alternative measures offer treatment, but can also threaten future benefits if drug problems persist, she said.
They also cost less than the $400 or so needed for tests that can catch a sufficient range of illegal drugs, and rule out false positive results with a follow-up test, she said.
---
Associated Press Writer Lawrence Messina in Charleston contributed to this report.
Friday, March 27, 2009
Stocks slide after weak government debt auction
http://finance.yahoo.com/news/Stocks-slide-after-weak-apf-14744876.html
Stocks slide after weak government debt auction
Stocks slide after lackluster demand for US debt stirs worries about economic recovery plans
Tim Paradis, AP Business Writer
Wednesday March 25, 2009
NEW YORK (AP) -- Stocks lost ground Wednesday after a weak auction of U.S. government debt stirred worries about how easily Washington will be able to raise money to fund its economic rescue program.
Investors gave an unexpectedly cool response to a $24 billion auction of 5-year Treasury notes Wednesday, just a day after a $40 billion auction of 2-year notes suggested strong demand. Treasury prices also declined following the auction.
The government is running up record deficits in order to fund an array of plans to provide stimulus to the economy and support to the ailing financial system. Any suggestion that demand for U.S. government debt is weakening would be negative for stocks.
The market had been higher earlier in the day on enthusiasm over economic reports showing increased demand for big-ticket manufactured goods and higher sales of new homes. Both readings came in better than forecast.
In late afternoon trading, the Dow fell 108.08, or 1.4 percent, to 7,551.89. The Dow had been up about 200 points at its high of the day. The blue chips fell nearly 116 points on Tuesday and surged almost 500 on Monday.
Broader stock indicators also turned lower. The Standard & Poor's 500 index fell 14.83, or 1.8 percent, to 791.42, and the Nasdaq composite index fell 27.98, or 1.9 percent, to 1,488.54.
The Russell 2000 index of smaller companies fell 6.86, or 1.7 percent, to 409.92.
About two stocks fell for every one that rose on the New York Stock Exchange, where volume came to 1.15 billion shares.
Bond prices fell after the auction. The yield on the benchmark 10-year Treasury note, which moves opposite its price, jumped to 2.77 percent from 2.71 percent late Tuesday. The yield on the three-month T-bill rose to 0.19 percent from 0.17 percent Tuesday.
The dollar fell against other major currencies, while gold prices rose.
Jim King, chief investment officer at National Penn Investors Trust Co. in Reading, Pa., said investors are concerned about how well the government's plan to help banks remove bad assets from their books will work.
Stocks had jumped Monday as the plan was announced but then fell back on Tuesday. Now, the weak auction results are only adding to fears that an economic recovery could be more difficult.
"It's kind of feeding into the overall malaise that the market is experiencing following the big pop we got a couple of days ago," King said.
Stocks slide after weak government debt auction
Stocks slide after lackluster demand for US debt stirs worries about economic recovery plans
Tim Paradis, AP Business Writer
Wednesday March 25, 2009
NEW YORK (AP) -- Stocks lost ground Wednesday after a weak auction of U.S. government debt stirred worries about how easily Washington will be able to raise money to fund its economic rescue program.
Investors gave an unexpectedly cool response to a $24 billion auction of 5-year Treasury notes Wednesday, just a day after a $40 billion auction of 2-year notes suggested strong demand. Treasury prices also declined following the auction.
The government is running up record deficits in order to fund an array of plans to provide stimulus to the economy and support to the ailing financial system. Any suggestion that demand for U.S. government debt is weakening would be negative for stocks.
The market had been higher earlier in the day on enthusiasm over economic reports showing increased demand for big-ticket manufactured goods and higher sales of new homes. Both readings came in better than forecast.
In late afternoon trading, the Dow fell 108.08, or 1.4 percent, to 7,551.89. The Dow had been up about 200 points at its high of the day. The blue chips fell nearly 116 points on Tuesday and surged almost 500 on Monday.
Broader stock indicators also turned lower. The Standard & Poor's 500 index fell 14.83, or 1.8 percent, to 791.42, and the Nasdaq composite index fell 27.98, or 1.9 percent, to 1,488.54.
The Russell 2000 index of smaller companies fell 6.86, or 1.7 percent, to 409.92.
About two stocks fell for every one that rose on the New York Stock Exchange, where volume came to 1.15 billion shares.
Bond prices fell after the auction. The yield on the benchmark 10-year Treasury note, which moves opposite its price, jumped to 2.77 percent from 2.71 percent late Tuesday. The yield on the three-month T-bill rose to 0.19 percent from 0.17 percent Tuesday.
The dollar fell against other major currencies, while gold prices rose.
Jim King, chief investment officer at National Penn Investors Trust Co. in Reading, Pa., said investors are concerned about how well the government's plan to help banks remove bad assets from their books will work.
Stocks had jumped Monday as the plan was announced but then fell back on Tuesday. Now, the weak auction results are only adding to fears that an economic recovery could be more difficult.
"It's kind of feeding into the overall malaise that the market is experiencing following the big pop we got a couple of days ago," King said.
China calls for new reserve currency
http://www.ft.com/cms/s/0/7851925a-17a2-11de-8c9d-0000779fd2ac.html
China calls for new reserve currency
By Jamil Anderlini in Beijing
March 23 2009
China’s central bank on Monday proposed replacing the US dollar as the international reserve currency with a new global system controlled by the International Monetary Fund.
In an essay posted on the People’s Bank of China’s website, Zhou Xiaochuan, the central bank’s governor, said the goal would be to create a reserve currency “that is disconnected from individual nations and is able to remain stable in the long run, thus removing the inherent deficiencies caused by using credit-based national currencies”.
Analysts said the proposal was an indication of Beijing’s fears that actions being taken to save the domestic US economy would have a negative impact on China.
“This is a clear sign that China, as the largest holder of US dollar financial assets, is concerned about the potential inflationary risk of the US Federal Reserve printing money,” said Qu Hongbin, chief China economist for HSBC.
Although Mr Zhou did not mention the US dollar, the essay gave a pointed critique of the current dollar-dominated monetary system.
“The outbreak of the [current] crisis and its spillover to the entire world reflected the inherent vulnerabilities and systemic risks in the existing international monetary system,” Mr Zhou wrote.
China has little choice but to hold the bulk of its $2,000bn of foreign exchange reserves in US dollars, and this is unlikely to change in the near future.
To replace the current system, Mr Zhou suggested expanding the role of special drawing rights, which were introduced by the IMF in 1969 to support the Bretton Woods fixed exchange rate regime but became less relevant once that collapsed in the 1970s.
Today, the value of SDRs is based on a basket of four currencies – the US dollar, yen, euro and sterling – and they are used largely as a unit of account by the IMF and some other international organisations.
China’s proposal would expand the basket of currencies forming the basis of SDR valuation to all major economies and set up a settlement system between SDRs and other currencies so they could be used in international trade and financial transactions.
Countries would entrust a portion of their SDR reserves to the IMF to manage collectively on their behalf and SDRs would gradually replace existing reserve currencies.
Mr Zhou said the proposal would require “extraordinary political vision and courage” and acknowledged a debt to John Maynard Keynes, who made a similar suggestion in the 1940s.
China calls for new reserve currency
By Jamil Anderlini in Beijing
March 23 2009
China’s central bank on Monday proposed replacing the US dollar as the international reserve currency with a new global system controlled by the International Monetary Fund.
In an essay posted on the People’s Bank of China’s website, Zhou Xiaochuan, the central bank’s governor, said the goal would be to create a reserve currency “that is disconnected from individual nations and is able to remain stable in the long run, thus removing the inherent deficiencies caused by using credit-based national currencies”.
Analysts said the proposal was an indication of Beijing’s fears that actions being taken to save the domestic US economy would have a negative impact on China.
“This is a clear sign that China, as the largest holder of US dollar financial assets, is concerned about the potential inflationary risk of the US Federal Reserve printing money,” said Qu Hongbin, chief China economist for HSBC.
Although Mr Zhou did not mention the US dollar, the essay gave a pointed critique of the current dollar-dominated monetary system.
“The outbreak of the [current] crisis and its spillover to the entire world reflected the inherent vulnerabilities and systemic risks in the existing international monetary system,” Mr Zhou wrote.
China has little choice but to hold the bulk of its $2,000bn of foreign exchange reserves in US dollars, and this is unlikely to change in the near future.
To replace the current system, Mr Zhou suggested expanding the role of special drawing rights, which were introduced by the IMF in 1969 to support the Bretton Woods fixed exchange rate regime but became less relevant once that collapsed in the 1970s.
Today, the value of SDRs is based on a basket of four currencies – the US dollar, yen, euro and sterling – and they are used largely as a unit of account by the IMF and some other international organisations.
China’s proposal would expand the basket of currencies forming the basis of SDR valuation to all major economies and set up a settlement system between SDRs and other currencies so they could be used in international trade and financial transactions.
Countries would entrust a portion of their SDR reserves to the IMF to manage collectively on their behalf and SDRs would gradually replace existing reserve currencies.
Mr Zhou said the proposal would require “extraordinary political vision and courage” and acknowledged a debt to John Maynard Keynes, who made a similar suggestion in the 1940s.
Starbucks, Costco and Whole Foods team up
http://www.reuters.com/article/domesticNews/idUSTRE52L03920090322
Starbucks, Costco and Whole Foods team up on labor bill
Sat Mar 21, 2009
LOS ANGELES (Reuters) - Starbucks, Costco Wholesale Corp and Whole Foods Market are joining forces to propose alternatives to a bill that makes it easier for workers to unionize but is strongly opposed by U.S. corporations.
The three retail giants said on Saturday they sought a "third way" as big business and labor unions face off over the Employee Free Choice Act, backed by President Barack Obama.
The "card check" legislation would let workers form a union when a majority of employees sign authorization cards. That would change the current practice in which workers usually vote on unionizing, although the bill would leave the election option open for workers to choose.
Passing the bill is a top priority of labor unions, which in November helped Obama win the White House and the Democrats increase their hold on Congress. Unions, which suffered decades of declining membership, argue that elections allow anti-union managers to intimidate and harass employees.
U.S. businesses and investors oppose the legislation, with analysts saying retail names from Wal-Mart to Target would face higher labor costs and greater unionization risks. Wal-Mart said last week it was confident the legislation would be defeated in Congress.
Starbucks, Costco and Whole Foods, which invited other corporations, unions and public interest groups to join them, proposed instead that unions be given more access to meet with workers, stricter penalties for labor violations and a guaranteed right to request secret ballots in all circumstances.
"We believe in and trust our employees, which is neither anti-union nor pro-status quo," said Costco CEO James Sinegal.
The three companies will provide more details of their proposals on Sunday.
"Given the severe economic crisis facing America, it is time to avoid the polarization that has occurred on both sides of this issue, and instead, come together to find a productive approach," said Lanny Davis, an attorney with Orrick, Herrington & Sutcliffe, who was cited in the statement.
(Reporting by Edwin Chan; Editing by Peter Cooney)
Starbucks, Costco and Whole Foods team up on labor bill
Sat Mar 21, 2009
LOS ANGELES (Reuters) - Starbucks, Costco Wholesale Corp and Whole Foods Market are joining forces to propose alternatives to a bill that makes it easier for workers to unionize but is strongly opposed by U.S. corporations.
The three retail giants said on Saturday they sought a "third way" as big business and labor unions face off over the Employee Free Choice Act, backed by President Barack Obama.
The "card check" legislation would let workers form a union when a majority of employees sign authorization cards. That would change the current practice in which workers usually vote on unionizing, although the bill would leave the election option open for workers to choose.
Passing the bill is a top priority of labor unions, which in November helped Obama win the White House and the Democrats increase their hold on Congress. Unions, which suffered decades of declining membership, argue that elections allow anti-union managers to intimidate and harass employees.
U.S. businesses and investors oppose the legislation, with analysts saying retail names from Wal-Mart to Target would face higher labor costs and greater unionization risks. Wal-Mart said last week it was confident the legislation would be defeated in Congress.
Starbucks, Costco and Whole Foods, which invited other corporations, unions and public interest groups to join them, proposed instead that unions be given more access to meet with workers, stricter penalties for labor violations and a guaranteed right to request secret ballots in all circumstances.
"We believe in and trust our employees, which is neither anti-union nor pro-status quo," said Costco CEO James Sinegal.
The three companies will provide more details of their proposals on Sunday.
"Given the severe economic crisis facing America, it is time to avoid the polarization that has occurred on both sides of this issue, and instead, come together to find a productive approach," said Lanny Davis, an attorney with Orrick, Herrington & Sutcliffe, who was cited in the statement.
(Reporting by Edwin Chan; Editing by Peter Cooney)
So President Obama Is Finally Pissed Off?
http://www.blackagendareport.com/?q=content/so-president-obama-finally-pissed-so-what
So President Obama Is Finally Pissed Off? So What?
Wed, 03/18/2009
A Black Agenda Radio commentary by Glen Ford
The President's public display of anger at AIG is a cover for well-deserved political embarrassment. He and his bankster advisors have dedicated trillions to rescuing the criminal corporations of Wall Street from the consequences of their actions. He acts disappointed that they're still gangsters. "The logic of bankster capitalist enterprise, which AIG was created to protect and serve, is take the money and run - every chance you get."
Obama is Finally Pissed Off. So What?
A Black Agenda Radio commentary by Glen Ford
"Did Obama think these guys became financial gangsters as a public service?"
President Obama wants everybody to know that he's angry, really angry, at the zombie insurance giant AIG. Obama gave the impression that AIG pulled a fast one when it awarded its employees $165 million in bonuses for consummating derivative deals that have wrecked the global financial system. The President theatrically pounded the podium in righteous indignation. "How do they justify this outrage to the taxpayers who are keeping the company afloat?" said the usually super-cool chief executive.
Obama's question is misdirected. He should instead be asking himself and his own economic advisors how he and they allowed the racketeers at AIG to divvy up the people's bailout money among themselves. By the time Obama staged his big public blowout over the bonuses, most of the money was already gone, paid out to the foot soldiers of the AIG financial mafia. Treasury Secretary Timothy Geithner didn't stop the checks from going out. Neither did Larry Summers, head of the National Economic Council at the White House. Robert Rubin, who is guru to Summers and Geithner and to Obama himself, didn't alert his protégés to the likelihood that AIG would reserve a big cut of the bailout for distribution among its own gang. Did Obama think these guys became financial gangsters as a public service?
And why shouldn't they get a cut? The logic of bankster capitalist enterprise, which AIG was created to protect and serve, is take the money and run - every chance you get. AIG covered hundreds of billions - maybe trillions - of dollars in bets placed by the Wall Street mafia in the derivatives casino. But that was a scam, since AIG didn't really have the cash. If AIG went down, then many of the gamblers on Wall Street would go down with it. Therefore, in a bipartisan, help out your favorite gangster agreement, Bush Republicans and Obama Democrats gave AIG $170 billion dollars of the people's money to rescue AIG's clients, the gambling banksters of Wall Street. And why shouldn't the guys who covered the bets in the first place get a piece of the public bailout, themselves? The logic of criminal financial enterprise dictates that they are no more morally reprehensible than their clients.
"It is the public that should be angry with Obama."
The biggest client was none other than Goldman Sachs. AIG's bailout included cash to cover at least $12.9 billion in Goldman Sach's casino bets. As it turns out, the two Godfathers of the Wall Street bailout are Robert Rubin, Obama's personal economics guru, and Henry Paulson, George Bush's Treasury Secretary - both former CEOs of Goldman Sachs. Goldman Sachs had a consigliere in both administrations, ensuring that the logic of bankster capitalism prevailed across party lines.
Barack Obama has no right to be angry at AIG's diversion of bailout money. It is the public that should be angry with Obama, for keeping the zombies of AIG and Goldman Sachs alive, so they can steal again. As of last month, according to the New York Times, Washington has committed around $9 trillion to the bankster bailout. Obama pretends to be angry about a measly $165 million ripoff by AIG's employees. Actually, he's politically embarrassed. That's what happens when you run with gangsters.
BAR executive editor Glen Ford can be contacted at Glen.Ford@BlackAgendaReport.com.
So President Obama Is Finally Pissed Off? So What?
Wed, 03/18/2009
A Black Agenda Radio commentary by Glen Ford
The President's public display of anger at AIG is a cover for well-deserved political embarrassment. He and his bankster advisors have dedicated trillions to rescuing the criminal corporations of Wall Street from the consequences of their actions. He acts disappointed that they're still gangsters. "The logic of bankster capitalist enterprise, which AIG was created to protect and serve, is take the money and run - every chance you get."
Obama is Finally Pissed Off. So What?
A Black Agenda Radio commentary by Glen Ford
"Did Obama think these guys became financial gangsters as a public service?"
President Obama wants everybody to know that he's angry, really angry, at the zombie insurance giant AIG. Obama gave the impression that AIG pulled a fast one when it awarded its employees $165 million in bonuses for consummating derivative deals that have wrecked the global financial system. The President theatrically pounded the podium in righteous indignation. "How do they justify this outrage to the taxpayers who are keeping the company afloat?" said the usually super-cool chief executive.
Obama's question is misdirected. He should instead be asking himself and his own economic advisors how he and they allowed the racketeers at AIG to divvy up the people's bailout money among themselves. By the time Obama staged his big public blowout over the bonuses, most of the money was already gone, paid out to the foot soldiers of the AIG financial mafia. Treasury Secretary Timothy Geithner didn't stop the checks from going out. Neither did Larry Summers, head of the National Economic Council at the White House. Robert Rubin, who is guru to Summers and Geithner and to Obama himself, didn't alert his protégés to the likelihood that AIG would reserve a big cut of the bailout for distribution among its own gang. Did Obama think these guys became financial gangsters as a public service?
And why shouldn't they get a cut? The logic of bankster capitalist enterprise, which AIG was created to protect and serve, is take the money and run - every chance you get. AIG covered hundreds of billions - maybe trillions - of dollars in bets placed by the Wall Street mafia in the derivatives casino. But that was a scam, since AIG didn't really have the cash. If AIG went down, then many of the gamblers on Wall Street would go down with it. Therefore, in a bipartisan, help out your favorite gangster agreement, Bush Republicans and Obama Democrats gave AIG $170 billion dollars of the people's money to rescue AIG's clients, the gambling banksters of Wall Street. And why shouldn't the guys who covered the bets in the first place get a piece of the public bailout, themselves? The logic of criminal financial enterprise dictates that they are no more morally reprehensible than their clients.
"It is the public that should be angry with Obama."
The biggest client was none other than Goldman Sachs. AIG's bailout included cash to cover at least $12.9 billion in Goldman Sach's casino bets. As it turns out, the two Godfathers of the Wall Street bailout are Robert Rubin, Obama's personal economics guru, and Henry Paulson, George Bush's Treasury Secretary - both former CEOs of Goldman Sachs. Goldman Sachs had a consigliere in both administrations, ensuring that the logic of bankster capitalism prevailed across party lines.
Barack Obama has no right to be angry at AIG's diversion of bailout money. It is the public that should be angry with Obama, for keeping the zombies of AIG and Goldman Sachs alive, so they can steal again. As of last month, according to the New York Times, Washington has committed around $9 trillion to the bankster bailout. Obama pretends to be angry about a measly $165 million ripoff by AIG's employees. Actually, he's politically embarrassed. That's what happens when you run with gangsters.
BAR executive editor Glen Ford can be contacted at Glen.Ford@BlackAgendaReport.com.
Welcome to double-standard America
http://www.salon.com/opinion/feature/2009/03/21/sirota/
Welcome to double-standard America
The AIG scandal has made it apparent that we are ruled by a government of men, not laws.
By David Sirota
Mar. 21, 2009
United Steelworkers president Leo Gerard likes to say that Washington policymakers "treat the people who take a shower after work much differently than they treat the people who shower before they go to work." In the 21st century Gilded Age, the blue-collar shower-after-work crowd is given the tough, while the white-collar shower-before-work gang gets the love, and never before this week was that doctrine made so clear.
Following news that government-owned American International Group devoted $165 million of its $170 billion taxpayer bailout to employee bonuses, the White House insisted nothing could be done to halt the robbery. On ABC's Sunday chat show, Obama advisor Larry Summers couched his passive-aggressive defense of AIG's thieves in the saccharine argot of jurisprudence. "We are a country of law -- there are contracts (and) the government cannot just abrogate contracts," he said.
The rhetoric echoed John Adams' two-century-old fairy tale about an impartial "government of laws, and not of men." Only now, the reassuring platitudes can't hide the uncomfortable truth.
Last month, the same government that says it "cannot just abrogate" executives' bonus contracts used its leverage to cancel unions' wage contracts. As the Wall Street Journal reported, federal loans to G.M. and Chrysler were made contingent on those manufacturers shredding their existing labor pacts and "extract[ing] financial concessions from workers." In other words, our government asks us to believe that it possesses total authority to adjust contracts at car companies it lends to, and yet has zero power to modify contracts at financial firms it owns. This, even though the latter set of covenants might be easily abolished.
According to New York Attorney General Andrew Cuomo, these allegedly inviolate AIG agreements promised bonus money the company didn't have and were crafted by executives who knew the firm was collapsing, meaning there is a decent chance these pacts could be invalidated under "fraudulent conveyance" statutes. They also might be canceled via "force majeure" clauses allowing one party to rescind a pact in the event of extraordinary circumstances -- like, perhaps, the collapse of the world economy. (Note: BusinessWeek reports that corporations are already citing the recession as reason to invoke such clauses and nix their business-to-business contracts.)
But, then, those legal cases require a government that treats AIG's shower-before-work employees with the same firmness that it treats the auto industry's shower-after-work employees, not the government we currently have -- the one that believes "the supreme sanctity of employment contracts applies only to some types of employees but not others," as Salon.com's Glenn Greenwald says.
Mind you, this double standard works the other way, too.
Congressional Republicans have long supported the laws letting bankruptcy courts annul mortgage contracts for vacation homes. Those statutes help the shower-before-work clique at least retain their beachside villas, no matter how many of their speculative Ponzi schemes go bad. But for those who shower after work, it's Adams-esque bromides against "absolving borrowers of their personal responsibility," as the GOP announced it will oppose legislation permitting bankruptcy judges to revise mortgage contracts for primary residences.
Certainly, for all the connotations of fairness inherent in American politics' "country of law" catchphrases, most of us know that the selective application of legal principles is as old as the Republic. However, lots of us are only now discovering that inequality is so pronounced that the time of day we bathe determines the enforcement and reliability (or lack thereof) of even the most basic contracts.
We are just realizing that for all the parroting of America's second president, we are ruled by a government of men, and not of laws.
Welcome to double-standard America
The AIG scandal has made it apparent that we are ruled by a government of men, not laws.
By David Sirota
Mar. 21, 2009
United Steelworkers president Leo Gerard likes to say that Washington policymakers "treat the people who take a shower after work much differently than they treat the people who shower before they go to work." In the 21st century Gilded Age, the blue-collar shower-after-work crowd is given the tough, while the white-collar shower-before-work gang gets the love, and never before this week was that doctrine made so clear.
Following news that government-owned American International Group devoted $165 million of its $170 billion taxpayer bailout to employee bonuses, the White House insisted nothing could be done to halt the robbery. On ABC's Sunday chat show, Obama advisor Larry Summers couched his passive-aggressive defense of AIG's thieves in the saccharine argot of jurisprudence. "We are a country of law -- there are contracts (and) the government cannot just abrogate contracts," he said.
The rhetoric echoed John Adams' two-century-old fairy tale about an impartial "government of laws, and not of men." Only now, the reassuring platitudes can't hide the uncomfortable truth.
Last month, the same government that says it "cannot just abrogate" executives' bonus contracts used its leverage to cancel unions' wage contracts. As the Wall Street Journal reported, federal loans to G.M. and Chrysler were made contingent on those manufacturers shredding their existing labor pacts and "extract[ing] financial concessions from workers." In other words, our government asks us to believe that it possesses total authority to adjust contracts at car companies it lends to, and yet has zero power to modify contracts at financial firms it owns. This, even though the latter set of covenants might be easily abolished.
According to New York Attorney General Andrew Cuomo, these allegedly inviolate AIG agreements promised bonus money the company didn't have and were crafted by executives who knew the firm was collapsing, meaning there is a decent chance these pacts could be invalidated under "fraudulent conveyance" statutes. They also might be canceled via "force majeure" clauses allowing one party to rescind a pact in the event of extraordinary circumstances -- like, perhaps, the collapse of the world economy. (Note: BusinessWeek reports that corporations are already citing the recession as reason to invoke such clauses and nix their business-to-business contracts.)
But, then, those legal cases require a government that treats AIG's shower-before-work employees with the same firmness that it treats the auto industry's shower-after-work employees, not the government we currently have -- the one that believes "the supreme sanctity of employment contracts applies only to some types of employees but not others," as Salon.com's Glenn Greenwald says.
Mind you, this double standard works the other way, too.
Congressional Republicans have long supported the laws letting bankruptcy courts annul mortgage contracts for vacation homes. Those statutes help the shower-before-work clique at least retain their beachside villas, no matter how many of their speculative Ponzi schemes go bad. But for those who shower after work, it's Adams-esque bromides against "absolving borrowers of their personal responsibility," as the GOP announced it will oppose legislation permitting bankruptcy judges to revise mortgage contracts for primary residences.
Certainly, for all the connotations of fairness inherent in American politics' "country of law" catchphrases, most of us know that the selective application of legal principles is as old as the Republic. However, lots of us are only now discovering that inequality is so pronounced that the time of day we bathe determines the enforcement and reliability (or lack thereof) of even the most basic contracts.
We are just realizing that for all the parroting of America's second president, we are ruled by a government of men, and not of laws.
LET IT DIE: Rushkoff on the economy
http://www.arthurmag.com/2009/03/16/let-it-die-rushkoff-on-the-economy/
LET IT DIE: Rushkoff on the economy
by Douglas Rushkoff
March 15, 2009
With any luck, the economy will never recover.
In a perfect world, the stock market would decline another 70 or 80 percent along with the shuttering of about that fraction of our nation’s banks. Yes, unemployment would rise as hundreds of thousands of formerly well-paid brokers and bankers lost their jobs; but at least they would no longer be extracting wealth at our expense. They would need to be fed, but that would be a lot cheaper than keeping them in the luxurious conditions they’re enjoying now. Even Bernie Madoff costs us less in jail than he does on Park Avenue.
Alas, I’m not being sarcastic. If you had spent the last decade, as I have, reviewing the way a centralized economic plan ravaged the real world over the past 500 years, you would appreciate the current financial meltdown for what it is: a comeuppance. This is the sound of the other shoe dropping; it’s what happens when the chickens come home to roost; it’s justice, equilibrium reasserting itself, and ultimately a good thing.
I started writing a book three years ago through which I hoped to help people see the artificial and ultimately dehumanizing landscape of corporatism on which we conduct so much of our lives. It’s not just that I saw the downturn coming—it’s that I feared it wouldn’t come quickly or clearly enough to help us wake up from the self-destructive fantasy of an eternally expanding economic frontier. The planet, and its people, were being taxed beyond their capacity to produce. Try arguing that to a banker whose livelihood is based on perpetuating that illusion, or to people whose retirement incomes depend on just one more generation falling for the scam. It’s like arguing to Brooklyn’s latest crop of brownstone buyers that they’ve invested in real estate at the very moment the whole market is about to tank. (I did; it wasn’t pretty.)
Now that the scheme we have mistaken for the real economy is collapsing under its own weight, however, it’s a whole lot easier to make these arguments. And, if anything, it’s even more important for us to come to grips with the fact that the system in peril is not a natural one, or even one that we should be attempting to revive and restore. The thing that is dying—the corporatized model of commerce—has not, nor has it ever been, supportive of the real economy. It wasn’t meant to be. And before we start lamenting its demise or, worse, spending good money after bad to resuscitate it, we had better understand what it was for, how it nearly sucked us all dry, and why we should put it out of our misery.
Chartered Corporations
Back in the good ol’ days—I mean as far back as the late middle ages—people just did business with each other. As traveling got easier and people got access to new resources and markets, a middle class of merchants and small businesspeople started to get wealthy. So wealthy that they threatened the power of the aristocracy. Monarchs needed to come up with a way to stabilize their own wealth before the free market unseated them.
They invented the corporate charter. By granting an exclusive charter, a king could give one of his friends in the merchant class monopoly control over a region or sector. In exchange, he’d get shares in the company. So the businessperson no longer had to worry about competition—his position at the top of the business hierarchy was locked in place, by law. And the monarch never had to worry about losing his authority; businesses with crown-guaranteed charters tend to support the crown.
But this changed the shape of business fundamentally. Instead of thriving on innovation and progress, corporate monopolies simply sought to extract wealth from the regions they controlled. They didn’t need to compete, anymore, so they just sucked resources from places and people. Meanwhile, people living and working in the real world lost the ability to generate value by or for themselves.
For example: In the 1700s, American colonists were allowed to grow corn but they weren’t allowed to do anything with it–except sell it at fixed prices to the British East India Trading Company, the corporation sanctioned by England to do business in the colonies. Colonists weren’t allowed to sell their cotton to each other or, worse, make clothes out of it. They were mandated, by law, to ship it back to England where clothes were fabricated by another chartered monopoly, then shipped back to America where they could be purchased. The American war for independence was less a revolt against England than a revolt against her chartered corporations.
The other big innovation of the early corporate era was monopoly currency. There used to be lots of different kinds of money. Local currencies, which helped regions reinvest in their own activities, and centralized currencies, for long distance transactions. Local currencies were earned into existence. A farmer would grow a bunch of grain, bring it to the grain store, and get receipts for how much grain he had deposited. The receipts could be used as money—even by people who didn’t need grain at that particular moment. Everyone knew what it was worth.
The interesting thing about local, grain-based currencies was that they lost value over time. The people at the grain store had to be paid, and a certain amount of grain was lost to rain or rodents. So every year, the money would be worth less. This encouraged people to spend it rather than save it. And they did. Late Middle Ages workers were paid more for less work time than at any point in history. Women were taller in England in that era than they are today—an indication of their relative health. People did preventative maintenance on their equipment, and invested in innovation. There was so much extra money looking for productive investment, that people built cathedrals. The great cathedrals of Europe were not paid for with money from the Vatican; they were local investments, made by small towns looking for ways to share their prosperity with future generations by creating tourist attractions.
Local currencies favored local transactions, and worked against the interests of large corporations working from far away. In order to secure their own position as well as that of their chartered monopolies, monarchs began to make local currencies illegal, and force locals to instead use “coin of the realm.” These centralized currencies worked the opposite way. They were not earned into existence, they were lent into existence by a central bank. This meant any money issued to a person or business had to be paid back to the central bank, with interest.
What does that do to an economy? It bankrupts it. Think of it this way: A business borrows 1000 dollars from the bank to get started. In ten years, say, it is supposed to pay back 2000 to the bank. Where does the other 1000 come from? Some other business that has borrowed 1000 from the bank. For one business to pay back what it owes, another must go bankrupt. That, or borrow yet another 1000, and so on.
An economy based on an interest-bearing centralized currency must grow to survive, and this means extracting more, producing more and consuming more. Interest-bearing currency favors the redistribution of wealth from the periphery (the people) to the center (the corporations and their owners). Just sitting on money—capital—is the most assured way of increasing wealth. By the very mechanics of the system, the rich get richer on an absolute and relative basis.
The biggest wealth generator of all was banking itself. By lending money at interest to people and businesses who had no other way to conduct transactions or make investments, banks put themselves at the center of the extraction equation. The longer the economy survived, the more money would have to be borrowed, and the more interest earned by the bank.
Financial Meltdown
Which is pretty much how things have worked over the past 500 years to today. So what went wrong? Nothing. The system worked exactly as it was supposed to. The problem was that after America’s post WWII expansion, there was really no longer any real growth area in the economy from which to extract wealth. We were producing and consuming about as much as we could. Almost no commercial activity was occurring outside the corporate system. There was no room left to grow. Sure, outsourcing, lay-offs, and technology created some efficiencies, but wars, rising costs of health care, and exchange rates essentially offset any gains.
Making matters worse, all that capital that the wealthy had accumulated needed markets—even fake markets—in which to be invested. There was a ton of money out there—just nowhere to put it. Nothing on which to speculate.
The dot.com boom seemed to offer the promise of a new market, but it fizzled almost as quickly as it rose. So speculators turned instead to real assets, like corn, oil, even real estate. They started investing speculatively on the things that real people need to stay alive. What real people didn’t understand was that there is no way to compete against speculators. Speculators aren’t buying homes in which to live—they are buying houses to flip. Speculators aren’t buying corn to eat or oil to burn, but bushels to hoard and tankers to park off shore until prices rise. The fact that the speculative economy for cash and commodities accounts for over 95% of economic transactions, while people actually using money and consuming commodities constitute less than 5% tells us something important. Real supply and demand have almost nothing to do with prices. We do not live in an economy, we live in a Ponzi scheme.
Luckily for us, the banks, and the speculators depending on them, made a bad wager: they bet on our continuing capacity to provide a reality on which to base their highly leveraged schemes. We just couldn’t do it. They put us between a rock and a hard place. With George W’s help, they sold us on the notion of home ownership as a prerequisite to the American dream. And they created a number of loan products which made it look as if we could actually afford over-priced homes. The banking industry spent hundreds of millions of dollars lobbying for laws making bankruptcy difficult or impossible for average people to accomplish—while simultaneously selling average people loans that they would never be able to pay back.
The banks didn’t really care, anyway, since they never meant to keep these loans. They simply provided the cash to mortgage companies, who then packaged the loans. In return for putting up the original cash, the banks also won the right to underwrite the sale of those mortgage packages to investors—investors like pension funds, retirement funds, or you and me. Get it? The banks get all the interest, but we put up all the money. Our retirement accounts and pension funds invest in the very mortgages that we can’t pay back. The bank collects any interest, playing both sides of the equation but responsible for neither.
And when the whole scheme begins to break down, what do we do? We try to bail out the very banks that created the mess, under the premise that we need these banks in order for business to come back, since only banks can lend the capital required for businesses to flourish.
Yes, It is Wrong
President Obama may be smarter than most of us, but he’s still attempting to rescue the very institutions that robbed us in the first place. He’s not a socialist, as conservatives may be arguing, but he is a corporatist. Using future tax dollars to fund government job programs is one thing. Using future tax dollars to give banks more money to lend out at interest is robbing from the poor to pay the rich to rob from the poor.
As painful as it might be to watch, and as irritating as it might be to those with shrinking retirement savings, the collapse of the centralized corporate economy is ultimately a good thing. It makes room for a real economy to rise up in its place. And while it may be temporarily uncomfortable for the rich, and even temporarily devastating for the poor, it may be the fastest and least violent way to dismantle a system set in place for the benefit of 14th Century monarchs who have long since left this earth.
If the corporate supermarket chain’s debt structure renders it incapable of stocking its shelves this spring, this may be the wake-up call that consumers need to finally subscribe to a Community Supported Agriculture farmer. If the former associate fund analyst at Lehman realizes that he is unable to get a job not just because his industry is contracting but because his work day creates no real value for anyone at all, he will be forced to learn how to do something that does. If an urban elite parent realizes he can no longer pay private school tuition for his kids, maybe he’ll consider donating to public school the time he would have spent earning that tuition.
In short, the less we are able to depend on business-as-usual to provide for our basic needs, the more we will be forced to provide them for ourselves and one another. Sometimes we’ll do this for free, because we like each other, or live in the same community. Sometimes we’ll exchange services or favors. Sometimes we’ll use one of the alternative, local currencies coming into use across the country as Central bank-issued currencies become too hard to get without a corporate job.
Deprived of centralized banks and corporations, we’ll be forced to do things again. And in the process, we’ll find out that these institutions were not our benefactors at all. They were never meant to be. They were invented to mediate transactions between people, and extract the value that would have passed between us. Far from making commerce or industry more efficient, they served to turn the real world into a set of speculative assets, and real people into debtors.
The current financial crisis is the best opportunity we have had in a very long time for a bloodless revolution against the faceless fascism under which we have been living, unaware, for much too long. Let us seize the day.
Longtime Arthur columnist Douglas Rushkoff has just finished his life’s work, “Life Inc: How the world became a corporation and how to take it back,” to be published June 2, 2009 by Random House. His live talk radio show, Media Squat Radio, airs Mondays 7-8pm EDT on WFMU. Streams at www.wfmu.org and iTunes.
LET IT DIE: Rushkoff on the economy
by Douglas Rushkoff
March 15, 2009
With any luck, the economy will never recover.
In a perfect world, the stock market would decline another 70 or 80 percent along with the shuttering of about that fraction of our nation’s banks. Yes, unemployment would rise as hundreds of thousands of formerly well-paid brokers and bankers lost their jobs; but at least they would no longer be extracting wealth at our expense. They would need to be fed, but that would be a lot cheaper than keeping them in the luxurious conditions they’re enjoying now. Even Bernie Madoff costs us less in jail than he does on Park Avenue.
Alas, I’m not being sarcastic. If you had spent the last decade, as I have, reviewing the way a centralized economic plan ravaged the real world over the past 500 years, you would appreciate the current financial meltdown for what it is: a comeuppance. This is the sound of the other shoe dropping; it’s what happens when the chickens come home to roost; it’s justice, equilibrium reasserting itself, and ultimately a good thing.
I started writing a book three years ago through which I hoped to help people see the artificial and ultimately dehumanizing landscape of corporatism on which we conduct so much of our lives. It’s not just that I saw the downturn coming—it’s that I feared it wouldn’t come quickly or clearly enough to help us wake up from the self-destructive fantasy of an eternally expanding economic frontier. The planet, and its people, were being taxed beyond their capacity to produce. Try arguing that to a banker whose livelihood is based on perpetuating that illusion, or to people whose retirement incomes depend on just one more generation falling for the scam. It’s like arguing to Brooklyn’s latest crop of brownstone buyers that they’ve invested in real estate at the very moment the whole market is about to tank. (I did; it wasn’t pretty.)
Now that the scheme we have mistaken for the real economy is collapsing under its own weight, however, it’s a whole lot easier to make these arguments. And, if anything, it’s even more important for us to come to grips with the fact that the system in peril is not a natural one, or even one that we should be attempting to revive and restore. The thing that is dying—the corporatized model of commerce—has not, nor has it ever been, supportive of the real economy. It wasn’t meant to be. And before we start lamenting its demise or, worse, spending good money after bad to resuscitate it, we had better understand what it was for, how it nearly sucked us all dry, and why we should put it out of our misery.
Chartered Corporations
Back in the good ol’ days—I mean as far back as the late middle ages—people just did business with each other. As traveling got easier and people got access to new resources and markets, a middle class of merchants and small businesspeople started to get wealthy. So wealthy that they threatened the power of the aristocracy. Monarchs needed to come up with a way to stabilize their own wealth before the free market unseated them.
They invented the corporate charter. By granting an exclusive charter, a king could give one of his friends in the merchant class monopoly control over a region or sector. In exchange, he’d get shares in the company. So the businessperson no longer had to worry about competition—his position at the top of the business hierarchy was locked in place, by law. And the monarch never had to worry about losing his authority; businesses with crown-guaranteed charters tend to support the crown.
But this changed the shape of business fundamentally. Instead of thriving on innovation and progress, corporate monopolies simply sought to extract wealth from the regions they controlled. They didn’t need to compete, anymore, so they just sucked resources from places and people. Meanwhile, people living and working in the real world lost the ability to generate value by or for themselves.
For example: In the 1700s, American colonists were allowed to grow corn but they weren’t allowed to do anything with it–except sell it at fixed prices to the British East India Trading Company, the corporation sanctioned by England to do business in the colonies. Colonists weren’t allowed to sell their cotton to each other or, worse, make clothes out of it. They were mandated, by law, to ship it back to England where clothes were fabricated by another chartered monopoly, then shipped back to America where they could be purchased. The American war for independence was less a revolt against England than a revolt against her chartered corporations.
The other big innovation of the early corporate era was monopoly currency. There used to be lots of different kinds of money. Local currencies, which helped regions reinvest in their own activities, and centralized currencies, for long distance transactions. Local currencies were earned into existence. A farmer would grow a bunch of grain, bring it to the grain store, and get receipts for how much grain he had deposited. The receipts could be used as money—even by people who didn’t need grain at that particular moment. Everyone knew what it was worth.
The interesting thing about local, grain-based currencies was that they lost value over time. The people at the grain store had to be paid, and a certain amount of grain was lost to rain or rodents. So every year, the money would be worth less. This encouraged people to spend it rather than save it. And they did. Late Middle Ages workers were paid more for less work time than at any point in history. Women were taller in England in that era than they are today—an indication of their relative health. People did preventative maintenance on their equipment, and invested in innovation. There was so much extra money looking for productive investment, that people built cathedrals. The great cathedrals of Europe were not paid for with money from the Vatican; they were local investments, made by small towns looking for ways to share their prosperity with future generations by creating tourist attractions.
Local currencies favored local transactions, and worked against the interests of large corporations working from far away. In order to secure their own position as well as that of their chartered monopolies, monarchs began to make local currencies illegal, and force locals to instead use “coin of the realm.” These centralized currencies worked the opposite way. They were not earned into existence, they were lent into existence by a central bank. This meant any money issued to a person or business had to be paid back to the central bank, with interest.
What does that do to an economy? It bankrupts it. Think of it this way: A business borrows 1000 dollars from the bank to get started. In ten years, say, it is supposed to pay back 2000 to the bank. Where does the other 1000 come from? Some other business that has borrowed 1000 from the bank. For one business to pay back what it owes, another must go bankrupt. That, or borrow yet another 1000, and so on.
An economy based on an interest-bearing centralized currency must grow to survive, and this means extracting more, producing more and consuming more. Interest-bearing currency favors the redistribution of wealth from the periphery (the people) to the center (the corporations and their owners). Just sitting on money—capital—is the most assured way of increasing wealth. By the very mechanics of the system, the rich get richer on an absolute and relative basis.
The biggest wealth generator of all was banking itself. By lending money at interest to people and businesses who had no other way to conduct transactions or make investments, banks put themselves at the center of the extraction equation. The longer the economy survived, the more money would have to be borrowed, and the more interest earned by the bank.
Financial Meltdown
Which is pretty much how things have worked over the past 500 years to today. So what went wrong? Nothing. The system worked exactly as it was supposed to. The problem was that after America’s post WWII expansion, there was really no longer any real growth area in the economy from which to extract wealth. We were producing and consuming about as much as we could. Almost no commercial activity was occurring outside the corporate system. There was no room left to grow. Sure, outsourcing, lay-offs, and technology created some efficiencies, but wars, rising costs of health care, and exchange rates essentially offset any gains.
Making matters worse, all that capital that the wealthy had accumulated needed markets—even fake markets—in which to be invested. There was a ton of money out there—just nowhere to put it. Nothing on which to speculate.
The dot.com boom seemed to offer the promise of a new market, but it fizzled almost as quickly as it rose. So speculators turned instead to real assets, like corn, oil, even real estate. They started investing speculatively on the things that real people need to stay alive. What real people didn’t understand was that there is no way to compete against speculators. Speculators aren’t buying homes in which to live—they are buying houses to flip. Speculators aren’t buying corn to eat or oil to burn, but bushels to hoard and tankers to park off shore until prices rise. The fact that the speculative economy for cash and commodities accounts for over 95% of economic transactions, while people actually using money and consuming commodities constitute less than 5% tells us something important. Real supply and demand have almost nothing to do with prices. We do not live in an economy, we live in a Ponzi scheme.
Luckily for us, the banks, and the speculators depending on them, made a bad wager: they bet on our continuing capacity to provide a reality on which to base their highly leveraged schemes. We just couldn’t do it. They put us between a rock and a hard place. With George W’s help, they sold us on the notion of home ownership as a prerequisite to the American dream. And they created a number of loan products which made it look as if we could actually afford over-priced homes. The banking industry spent hundreds of millions of dollars lobbying for laws making bankruptcy difficult or impossible for average people to accomplish—while simultaneously selling average people loans that they would never be able to pay back.
The banks didn’t really care, anyway, since they never meant to keep these loans. They simply provided the cash to mortgage companies, who then packaged the loans. In return for putting up the original cash, the banks also won the right to underwrite the sale of those mortgage packages to investors—investors like pension funds, retirement funds, or you and me. Get it? The banks get all the interest, but we put up all the money. Our retirement accounts and pension funds invest in the very mortgages that we can’t pay back. The bank collects any interest, playing both sides of the equation but responsible for neither.
And when the whole scheme begins to break down, what do we do? We try to bail out the very banks that created the mess, under the premise that we need these banks in order for business to come back, since only banks can lend the capital required for businesses to flourish.
Yes, It is Wrong
President Obama may be smarter than most of us, but he’s still attempting to rescue the very institutions that robbed us in the first place. He’s not a socialist, as conservatives may be arguing, but he is a corporatist. Using future tax dollars to fund government job programs is one thing. Using future tax dollars to give banks more money to lend out at interest is robbing from the poor to pay the rich to rob from the poor.
As painful as it might be to watch, and as irritating as it might be to those with shrinking retirement savings, the collapse of the centralized corporate economy is ultimately a good thing. It makes room for a real economy to rise up in its place. And while it may be temporarily uncomfortable for the rich, and even temporarily devastating for the poor, it may be the fastest and least violent way to dismantle a system set in place for the benefit of 14th Century monarchs who have long since left this earth.
If the corporate supermarket chain’s debt structure renders it incapable of stocking its shelves this spring, this may be the wake-up call that consumers need to finally subscribe to a Community Supported Agriculture farmer. If the former associate fund analyst at Lehman realizes that he is unable to get a job not just because his industry is contracting but because his work day creates no real value for anyone at all, he will be forced to learn how to do something that does. If an urban elite parent realizes he can no longer pay private school tuition for his kids, maybe he’ll consider donating to public school the time he would have spent earning that tuition.
In short, the less we are able to depend on business-as-usual to provide for our basic needs, the more we will be forced to provide them for ourselves and one another. Sometimes we’ll do this for free, because we like each other, or live in the same community. Sometimes we’ll exchange services or favors. Sometimes we’ll use one of the alternative, local currencies coming into use across the country as Central bank-issued currencies become too hard to get without a corporate job.
Deprived of centralized banks and corporations, we’ll be forced to do things again. And in the process, we’ll find out that these institutions were not our benefactors at all. They were never meant to be. They were invented to mediate transactions between people, and extract the value that would have passed between us. Far from making commerce or industry more efficient, they served to turn the real world into a set of speculative assets, and real people into debtors.
The current financial crisis is the best opportunity we have had in a very long time for a bloodless revolution against the faceless fascism under which we have been living, unaware, for much too long. Let us seize the day.
Longtime Arthur columnist Douglas Rushkoff has just finished his life’s work, “Life Inc: How the world became a corporation and how to take it back,” to be published June 2, 2009 by Random House. His live talk radio show, Media Squat Radio, airs Mondays 7-8pm EDT on WFMU. Streams at www.wfmu.org and iTunes.
Wall Street celebrates government windfall
http://wsws.org/articles/2009/mar2009/toxi-m24.shtml
Wall Street celebrates government windfall for banks and big investors
By Barry Grey
24 March 2009
Wall Street erupted in a demonstration of euphoria and greed Monday as the Obama administration announced a plan to offload bankers' bad debts that amounts to an unprecedented looting of taxpayer funds to benefit the financial elite.
All of the major stock indexes soared as Treasury Secretary Timothy Geithner laid out details of the administration's so-called Public-Private Investment Program—a euphemism for a scheme to bankroll private investment firms and guarantee them huge profits in return for buying failed home loans and securities from the banks at vastly inflated prices.
The masters of Wall Street, who have been driving up share prices in recent days—especially bank stocks—in anticipation of the roll-out of the program, were delighted to find that it not only met, but exceeded their expectations.
Hedge funds and private equity firms that participate in the scheme will put up as little as 5 percent of the capital to buy between $500 billion and $1 trillion of the banks' junk assets, with the government providing the rest in the form of $75-$100 billion in Treasury funds and low-cost loans from the Federal Reserve Board and the Federal Deposit Insurance Corporation (FDIC). The loans will be guaranteed by the government, which will assume the overwhelming bulk of any losses.
Even though the bulk of the capital and financing will come from the government, the public-private investment funds set up under the scheme will be run by private investment firms, which will receive lucrative fees for dividing up the booty.
The banks cheered the deal because it will allow them, at their own discretion, to palm off their bad debts at prices many multiples of what they could currently fetch on the market. Since the government will bankroll the big investors and assume virtually all of the risk, the investors will be willing to pay inflated prices for the illiquid loans and securities in government-supervised auctions. They calculate that they can hold the assets until the housing market recovers and then sell them back to the financial markets at a return of 20 percent or more.
For their part, the banks will be able, at little cost, to cleanse their balance sheets of what is routinely referred to as "toxic waste," laying the basis for a big rise in their stock.
The entire scheme is voluntary. No one on Wall Street is required to do anything—unless he judges there is a substantial profit to be made. There is no requirement that the banks increase their lending. They can choose to continue to hoard their government windfalls—as they have done thus far with the billions they've received in cash injections and government loans—in order to pressure the state for even more favorable terms.
Stocks opened sharply higher after Geithner's presentation of the plan to reporters Monday morning. They continued to rise throughout the day. The Dow Jones Industrial Average closed with a gain of 497 points, or 6.8 percent. It was the Dow's biggest one-day rise since October 28, bringing it 18.8 percent higher than its low earlier this month. The other major indexes—the Standard & Poor's 500 and the Nasdaq—registered similar gains.
It was, above all, a banner day for bank stocks. Citigroup finished up 19 percent, Bank of America rose 26 percent, JPMorgan Chase closed 25 percent higher and Wells Fargo ended with a gain of 24 percent.
There was a political as well as an economic component to the jubilation on Wall Street. The plan and the related statements of top administration officials, beginning with Obama, were rightly taken to demonstrate that the Obama administration is nothing more than a direct instrument of the most powerful sections of the financial aristocracy.
Top administration economic officials and Obama himself spent the weekend reassuring Wall Street, which responded with fury to a bill passed by the House of Representatives taxing the bonuses of wealthy executives and traders at AIG and other bailed-out firms, that they did not support the measure and would impose no executive pay limits on firms that participated in the new bank bailout measure.
With Wall Street executives threatening to boycott the program unless they were given ironclad assurances that their fortunes would not be touched and there would be no "change in the rules" down the road, Geithner gave an interview that was published by the Wall Street Journal Monday morning pleading for hedge funds and banks to participate. "The Obama administration believes those provisions shouldn't apply to such broad programs [as the Public-Private Investment Plan] and an exception was made last month for participants in the Federal Reserve's consumer-lending facility," the newspaper reported.
The same issue carried a column by Geithner entitled "My Plan for Bad Bank Assets" which declared that "we need to be very careful not to discourage those investments the economy needs to recover from recession." It went on to equate protecting the million-dollar bonuses awarded by firms that have bilked the public for billions of dollars with defending "the rule of law." Geithner solemnly wrote that "when our government gives its word" to "responsible entrepreneurs and investors... we mean it."
In his press briefing Monday morning, he rejected any suggestion that the government might temporarily nationalize failing banks and declared, "We're going to do what's necessary to protect the system."
Obama, in remarks to the press on the toxic asset plan following a meeting with his top economic advisers, affirmed that it "will involve market participants who have every interest in making a profit."
In fact, the plan was drawn up in the closest consultation with the billionaire bankers and hedge fund managers who stand to profit from it. The Financial Times reported Monday:
"People close to the situation said the plan was the result of detailed talks between Treasury, banks, private equity groups and other investors over the past few weeks. Senior private equity executives said the key terms of the initiative unveiled on Monday went beyond their own wish-lists.
"Some investors had asked Treasury to provide debt equal to around three to four times the value of the equity to be injected in the public-private partnerships, but the authorities decided to grant leverage of up to six times for the purchase of toxic loans, making it even more attractive for private equity groups to participate in the plan...
"‘As it stands, there is very limited downside for us,' a senior Wall Street banker said. ‘If we like the price offered, we will sell the assets and record an accounting gain and if we don't, we will stay as we are.'"
Among the big Wall Street investors who praised the scheme and announced their intention to get in on the action was Bill Gross, the founder and head of Pacific Investment Management Co. (PIMCO), the world's biggest bond fund. Gross, along with billionaire investor Warren Buffett and Goldman Sachs CEO Lloyd Blankfein, first broached the idea of creating public-private investment funds to buy toxic bank assets with Treasury officials last fall.
The noted economist Jeffrey Sachs provided an accurate characterization of the plan in a commentary published Monday by the Huffington Post.
He wrote: "Geithner and Summers [Lawrence Summers, director of the White House's National Economic Council] have now announced their plan to raid the Federal Deposit Insurance Corporation (FDIC) and Federal Reserve (Fed) to subsidize investors to buy toxic assets from the banks at inflated prices. If carried out, the result will be a massive transfer of wealth—of perhaps hundreds of billions of dollars—to bank shareholders from the taxpayers (who will absorb losses at the FDIC and Fed)...
"The investment funds will have the following balance sheet. For every $1 of toxic assets that they buy from the banks, the FDIC will lend up to 85.7 cents (six-sevenths of $1), and the Treasury and private investors will each put in 7.15 cents in equity to cover the remaining balance. The Federal Deposit Insurance Corporation loans will be non-recourse, meaning that if the toxic assets purchased by private investors fall in value below the amount of the FDIC loans, the investment funds will default on the loans and the FDIC will end up holding the toxic assets...
"The FDIC is giving a ‘heads you win, tails the taxpayer loses' offer to the private investors."
Princeton University economist and New York Times columnist Paul Krugman offered a similar assessment, writing, "But the Geithner scheme would offer a one-way bet: if asset values go up, the investors profit, but if they go down, the investors can walk away from their debt. This isn't really about letting markets work. It's just an indirect, disguised way to subsidize purchases of bad assets."
Mournfully, he noted, "It's as if the president were determined to confirm the growing perception that he and his economic team are out of touch, that their economic vision is clouded by excessively close ties to Wall Street."
It is not, however, a matter of Obama's "clouded vision," but rather an administration that embodies the reality of class relations in America and the dictatorship of finance capital which is exercised through a political system dominated by two parties of the capitalist ruling elite. The wholesale theft of the social wealth embodied in the latest bailout scheme is a continuation of a policy that has, from day one, been driven by horror not at the impoverishment of tens of millions of workers, but rather the prospect that the crisis of their own making could cut into the vast wealth of the financial oligarchs.
On Monday, Wall Street celebrated the fact that it has in Washington a bunch of lackeys who can be counted on to do its bidding.
Wall Street celebrates government windfall for banks and big investors
By Barry Grey
24 March 2009
Wall Street erupted in a demonstration of euphoria and greed Monday as the Obama administration announced a plan to offload bankers' bad debts that amounts to an unprecedented looting of taxpayer funds to benefit the financial elite.
All of the major stock indexes soared as Treasury Secretary Timothy Geithner laid out details of the administration's so-called Public-Private Investment Program—a euphemism for a scheme to bankroll private investment firms and guarantee them huge profits in return for buying failed home loans and securities from the banks at vastly inflated prices.
The masters of Wall Street, who have been driving up share prices in recent days—especially bank stocks—in anticipation of the roll-out of the program, were delighted to find that it not only met, but exceeded their expectations.
Hedge funds and private equity firms that participate in the scheme will put up as little as 5 percent of the capital to buy between $500 billion and $1 trillion of the banks' junk assets, with the government providing the rest in the form of $75-$100 billion in Treasury funds and low-cost loans from the Federal Reserve Board and the Federal Deposit Insurance Corporation (FDIC). The loans will be guaranteed by the government, which will assume the overwhelming bulk of any losses.
Even though the bulk of the capital and financing will come from the government, the public-private investment funds set up under the scheme will be run by private investment firms, which will receive lucrative fees for dividing up the booty.
The banks cheered the deal because it will allow them, at their own discretion, to palm off their bad debts at prices many multiples of what they could currently fetch on the market. Since the government will bankroll the big investors and assume virtually all of the risk, the investors will be willing to pay inflated prices for the illiquid loans and securities in government-supervised auctions. They calculate that they can hold the assets until the housing market recovers and then sell them back to the financial markets at a return of 20 percent or more.
For their part, the banks will be able, at little cost, to cleanse their balance sheets of what is routinely referred to as "toxic waste," laying the basis for a big rise in their stock.
The entire scheme is voluntary. No one on Wall Street is required to do anything—unless he judges there is a substantial profit to be made. There is no requirement that the banks increase their lending. They can choose to continue to hoard their government windfalls—as they have done thus far with the billions they've received in cash injections and government loans—in order to pressure the state for even more favorable terms.
Stocks opened sharply higher after Geithner's presentation of the plan to reporters Monday morning. They continued to rise throughout the day. The Dow Jones Industrial Average closed with a gain of 497 points, or 6.8 percent. It was the Dow's biggest one-day rise since October 28, bringing it 18.8 percent higher than its low earlier this month. The other major indexes—the Standard & Poor's 500 and the Nasdaq—registered similar gains.
It was, above all, a banner day for bank stocks. Citigroup finished up 19 percent, Bank of America rose 26 percent, JPMorgan Chase closed 25 percent higher and Wells Fargo ended with a gain of 24 percent.
There was a political as well as an economic component to the jubilation on Wall Street. The plan and the related statements of top administration officials, beginning with Obama, were rightly taken to demonstrate that the Obama administration is nothing more than a direct instrument of the most powerful sections of the financial aristocracy.
Top administration economic officials and Obama himself spent the weekend reassuring Wall Street, which responded with fury to a bill passed by the House of Representatives taxing the bonuses of wealthy executives and traders at AIG and other bailed-out firms, that they did not support the measure and would impose no executive pay limits on firms that participated in the new bank bailout measure.
With Wall Street executives threatening to boycott the program unless they were given ironclad assurances that their fortunes would not be touched and there would be no "change in the rules" down the road, Geithner gave an interview that was published by the Wall Street Journal Monday morning pleading for hedge funds and banks to participate. "The Obama administration believes those provisions shouldn't apply to such broad programs [as the Public-Private Investment Plan] and an exception was made last month for participants in the Federal Reserve's consumer-lending facility," the newspaper reported.
The same issue carried a column by Geithner entitled "My Plan for Bad Bank Assets" which declared that "we need to be very careful not to discourage those investments the economy needs to recover from recession." It went on to equate protecting the million-dollar bonuses awarded by firms that have bilked the public for billions of dollars with defending "the rule of law." Geithner solemnly wrote that "when our government gives its word" to "responsible entrepreneurs and investors... we mean it."
In his press briefing Monday morning, he rejected any suggestion that the government might temporarily nationalize failing banks and declared, "We're going to do what's necessary to protect the system."
Obama, in remarks to the press on the toxic asset plan following a meeting with his top economic advisers, affirmed that it "will involve market participants who have every interest in making a profit."
In fact, the plan was drawn up in the closest consultation with the billionaire bankers and hedge fund managers who stand to profit from it. The Financial Times reported Monday:
"People close to the situation said the plan was the result of detailed talks between Treasury, banks, private equity groups and other investors over the past few weeks. Senior private equity executives said the key terms of the initiative unveiled on Monday went beyond their own wish-lists.
"Some investors had asked Treasury to provide debt equal to around three to four times the value of the equity to be injected in the public-private partnerships, but the authorities decided to grant leverage of up to six times for the purchase of toxic loans, making it even more attractive for private equity groups to participate in the plan...
"‘As it stands, there is very limited downside for us,' a senior Wall Street banker said. ‘If we like the price offered, we will sell the assets and record an accounting gain and if we don't, we will stay as we are.'"
Among the big Wall Street investors who praised the scheme and announced their intention to get in on the action was Bill Gross, the founder and head of Pacific Investment Management Co. (PIMCO), the world's biggest bond fund. Gross, along with billionaire investor Warren Buffett and Goldman Sachs CEO Lloyd Blankfein, first broached the idea of creating public-private investment funds to buy toxic bank assets with Treasury officials last fall.
The noted economist Jeffrey Sachs provided an accurate characterization of the plan in a commentary published Monday by the Huffington Post.
He wrote: "Geithner and Summers [Lawrence Summers, director of the White House's National Economic Council] have now announced their plan to raid the Federal Deposit Insurance Corporation (FDIC) and Federal Reserve (Fed) to subsidize investors to buy toxic assets from the banks at inflated prices. If carried out, the result will be a massive transfer of wealth—of perhaps hundreds of billions of dollars—to bank shareholders from the taxpayers (who will absorb losses at the FDIC and Fed)...
"The investment funds will have the following balance sheet. For every $1 of toxic assets that they buy from the banks, the FDIC will lend up to 85.7 cents (six-sevenths of $1), and the Treasury and private investors will each put in 7.15 cents in equity to cover the remaining balance. The Federal Deposit Insurance Corporation loans will be non-recourse, meaning that if the toxic assets purchased by private investors fall in value below the amount of the FDIC loans, the investment funds will default on the loans and the FDIC will end up holding the toxic assets...
"The FDIC is giving a ‘heads you win, tails the taxpayer loses' offer to the private investors."
Princeton University economist and New York Times columnist Paul Krugman offered a similar assessment, writing, "But the Geithner scheme would offer a one-way bet: if asset values go up, the investors profit, but if they go down, the investors can walk away from their debt. This isn't really about letting markets work. It's just an indirect, disguised way to subsidize purchases of bad assets."
Mournfully, he noted, "It's as if the president were determined to confirm the growing perception that he and his economic team are out of touch, that their economic vision is clouded by excessively close ties to Wall Street."
It is not, however, a matter of Obama's "clouded vision," but rather an administration that embodies the reality of class relations in America and the dictatorship of finance capital which is exercised through a political system dominated by two parties of the capitalist ruling elite. The wholesale theft of the social wealth embodied in the latest bailout scheme is a continuation of a policy that has, from day one, been driven by horror not at the impoverishment of tens of millions of workers, but rather the prospect that the crisis of their own making could cut into the vast wealth of the financial oligarchs.
On Monday, Wall Street celebrated the fact that it has in Washington a bunch of lackeys who can be counted on to do its bidding.
U.S. bill seeks to rescue faltering newspapers
http://www.reuters.com/article/politicsNews/idUSTRE52N67F20090324
U.S. bill seeks to rescue faltering newspapers
Tue Mar 24, 2009
By Thomas Ferraro
WASHINGTON (Reuters) - With many U.S. newspapers struggling to survive, a Democratic senator on Tuesday introduced a bill to help them by allowing newspaper companies to restructure as nonprofits with a variety of tax breaks.
"This may not be the optimal choice for some major newspapers or corporate media chains but it should be an option for many newspapers that are struggling to stay afloat," said Senator Benjamin Cardin.
A Cardin spokesman said the bill had yet to attract any co-sponsors, but had sparked plenty of interest within the media, which has seen plunging revenues and many journalist layoffs.
Cardin's Newspaper Revitalization Act would allow newspapers to operate as nonprofits for educational purposes under the U.S. tax code, giving them a similar status to public broadcasting companies.
Under this arrangement, newspapers would still be free to report on all issues, including political campaigns. But they would be prohibited from making political endorsements.
Advertising and subscription revenue would be tax exempt, and contributions to support news coverage or operations could be tax deductible.
Because newspaper profits have been falling in recent years, "no substantial loss of federal revenue" was expected under the legislation, Cardin's office said in a statement.
Cardin's office said his bill was aimed at preserving local and community newspapers, not conglomerates which may also own radio and TV stations. His bill would also let a non-profit buy newspapers owned by a conglomerate.
"We are losing our newspaper industry," Cardin said. "The economy has caused an immediate problem, but the business model for newspapers, based on circulation and advertising revenue, is broken, and that is a real tragedy for communities across the nation and for our democracy.
Newspaper subscriptions and advertising have shrunk dramatically in the past few years as Americans have turned more and more to the Internet or television for information.
In recent months, the Seattle Post-Intelligencer, the Rocky Mountain News, the Baltimore Examiner and the San Francisco Chronicle have ceased daily publication or announced that they may have to stop publishing.
In December the Tribune Company, which owns a number of newspapers including The Baltimore Sun, The Chicago Tribune and The Los Angeles Times filed for bankruptcy protection.
Two newspaper chains, Gannett Co Inc and Advance Publications, on Monday announced employee furloughs. It will be the second furlough this year at Gannett.
(Additional reporting by Chuck Abbott)
(Editing by David Storey)
U.S. bill seeks to rescue faltering newspapers
Tue Mar 24, 2009
By Thomas Ferraro
WASHINGTON (Reuters) - With many U.S. newspapers struggling to survive, a Democratic senator on Tuesday introduced a bill to help them by allowing newspaper companies to restructure as nonprofits with a variety of tax breaks.
"This may not be the optimal choice for some major newspapers or corporate media chains but it should be an option for many newspapers that are struggling to stay afloat," said Senator Benjamin Cardin.
A Cardin spokesman said the bill had yet to attract any co-sponsors, but had sparked plenty of interest within the media, which has seen plunging revenues and many journalist layoffs.
Cardin's Newspaper Revitalization Act would allow newspapers to operate as nonprofits for educational purposes under the U.S. tax code, giving them a similar status to public broadcasting companies.
Under this arrangement, newspapers would still be free to report on all issues, including political campaigns. But they would be prohibited from making political endorsements.
Advertising and subscription revenue would be tax exempt, and contributions to support news coverage or operations could be tax deductible.
Because newspaper profits have been falling in recent years, "no substantial loss of federal revenue" was expected under the legislation, Cardin's office said in a statement.
Cardin's office said his bill was aimed at preserving local and community newspapers, not conglomerates which may also own radio and TV stations. His bill would also let a non-profit buy newspapers owned by a conglomerate.
"We are losing our newspaper industry," Cardin said. "The economy has caused an immediate problem, but the business model for newspapers, based on circulation and advertising revenue, is broken, and that is a real tragedy for communities across the nation and for our democracy.
Newspaper subscriptions and advertising have shrunk dramatically in the past few years as Americans have turned more and more to the Internet or television for information.
In recent months, the Seattle Post-Intelligencer, the Rocky Mountain News, the Baltimore Examiner and the San Francisco Chronicle have ceased daily publication or announced that they may have to stop publishing.
In December the Tribune Company, which owns a number of newspapers including The Baltimore Sun, The Chicago Tribune and The Los Angeles Times filed for bankruptcy protection.
Two newspaper chains, Gannett Co Inc and Advance Publications, on Monday announced employee furloughs. It will be the second furlough this year at Gannett.
(Additional reporting by Chuck Abbott)
(Editing by David Storey)
Anne Hathaway could contend at Oscars
http://goldderby.latimes.com/awards_goldderby/2009/03/anne-hathaway-c.htmlGold Derby by Tom O'Neil
Anne Hathaway could contend at Oscars and Tonys for playing Judy Garland
March 23, 2009
If you thought Anne Hathaway was brave for singing and dancing with Hugh Jackman on the recent Oscarcast, that was a walk in the park compared with her next performance — playing Judy Garland on both stage and screen. The Oscar-nominated actress ("Rachel Getting Married") is to star in upcoming film and legit adaptations of Gerald Clarke's 2000 biography "Get Happy: The Life of Judy Garland."
With the Weinstein Co. producing both these properties, Anne Hathaway is in good hands. While there is no word as to any of the other creatives involved in these projects, the source material is rich with possibilities, including as it does material in Judy Garland's own words. Gerald Clarke's biography of the late, great writer Truman Capote was the basis for "Capote," which was nominated for five awards at the 2005 Oscars including best picture and won lead actor for Philip Seymour Hoffman.
If Hathaway can pull this part off, she would be a leading contender at both the Oscars and the Tonys. Seven of the last 10 women to win lead actress at the Academy Awards did so by playing real-life roles. The irony of course is that Judy Garland never won a competitive Oscar. In 1939, she was awarded an honorary one for her timeless performance in "The Wizard of Oz."
However, she lost both of her Oscar races. In 1954, Judy Garland made one of the all-time great screen comebacks, proving herself a triple threat with her acting, singing and dancing in the musical remake of "A Star Is Born." So sure was the academy that she would win the lead actress Oscar that they set up a television camera in Judy's hospital room where she was resting after having given birth to son Joey just days before. However, it was Grace Kelly's name that was announced, for her role as the dutiful wife to an alcoholic actor (Bing Crosby) in "The Country Girl." And while Judy Garland was nominated for her 1961 supporting performance as a witness in "Judgment at Nuremberg," she lost to Rita Moreno for "West Side Story."
Judy Garland never appeared in a Broadway musical in her all-too-short life. In 1967, she was so eager to take over from Tony winner Angela Lansbury in "Mame" that she watched the show from the wings for nights on end. However, the producers could not get the insurance to cover the costs should Garland not appear. She did win an honorary Tony Award in 1952 for "for an important contribution to the revival of vaudeville through her recent stint at the Palace Theatre."
Broadway usually favors the fanciful over the fact-driven, though the last two Tonys for lead actress in a musical went to hopefully heightened portrayals of real-life women — Christine Ebersole ("Grey Gardens") and Patti Lupone ("Gypsy"). While Hathaway has never appeared on Broadway, in 2002 she tackled a Tony-winning role for five performances of a concert version of the 1961 musical "Carnival." As the orphaned Lili (a part that earned Anna Maria Alberghetti the lead actress award), Hathaway shone opposite Tony winner Brian Stokes Mitchell ("Kiss Me Kate"). This summer, Hathway is to star in a production of "Twelfth Night" as part of the Public Theatre's celebrated Shakespeare in the Park series in New York's Central Park.
The big question is whether Anne Hathaway will sing the songs so associated with Judy Garland or mime along to recordings. In 2001, both Tammy Blanchard and Judy Davis won Emmy Awards for playing Judy Garland in the mini-series "Me and My Shadows." They both lip synced to Judy's unique song stylings. In 2004 Isabel Keating earned a Tony nomination as featured actress in a musical for her portrayal of Garland in "The Boy From Oz." She lost to Anika Noni Rose for "Caroline or Change."
While Isabel Keating performed musical numbers as Judy, she was not singing Garland songs. Rather, as the musical told the story of one-time Garland son-in-law Peter Allen, she sang some of his tunes. And bringing this item full circle, Hugh Jackman won the lead actor in a musical Tony Award for playing the singer-songwriter once married to Liza Minnelli.
Curt Schilling announces his retirement
http://www.sportingnews.com/yourturn/viewtopic.php?t=530642
Curt Schilling announces his retirement
March 23, 2009
Sporting News staff reports
Red Sox pitcher Curt Schilling is retiring after 20 years in the majors, he announced on his blog today.
"After being blessed to experience 23 years of playing professional baseball in front of the world's best fans in so many different places, it is with zero regrets that I am making my retirement official," Schilling wrote at 38pitches.com, his official blog.
Schilling, 42, had shoulder surgery and did not pitch in 2008.
The six-time All Star and 2001 co-World Series MVP finishes his career with a 216-140 record, a 3.46 ERA and 3,116 strikeouts. He pitched in the World Series four times, winning with the Diamondbacks in 2001 and the Red Sox in 2004 and 2007.
"That there are men with plaques in Cooperstown who never experienced one, and I was able to be on three teams over seven years that won it all is another 'beyond my wildest dreams' set of memories I'll be allowed to take with me," Schilling wrote.
Originally drafted by the Red Sox in 1986, Schilling pitched for the Orioles, Astros, Phillies, Diamondbacks and Red Sox. He twice led his league in wins and strikeouts.
Schilling was the Sporting News NL Pitcher of the Year in 2001 and 2002.
Curt Schilling announces his retirement
March 23, 2009
Sporting News staff reports
Red Sox pitcher Curt Schilling is retiring after 20 years in the majors, he announced on his blog today.
"After being blessed to experience 23 years of playing professional baseball in front of the world's best fans in so many different places, it is with zero regrets that I am making my retirement official," Schilling wrote at 38pitches.com, his official blog.
Schilling, 42, had shoulder surgery and did not pitch in 2008.
The six-time All Star and 2001 co-World Series MVP finishes his career with a 216-140 record, a 3.46 ERA and 3,116 strikeouts. He pitched in the World Series four times, winning with the Diamondbacks in 2001 and the Red Sox in 2004 and 2007.
"That there are men with plaques in Cooperstown who never experienced one, and I was able to be on three teams over seven years that won it all is another 'beyond my wildest dreams' set of memories I'll be allowed to take with me," Schilling wrote.
Originally drafted by the Red Sox in 1986, Schilling pitched for the Orioles, Astros, Phillies, Diamondbacks and Red Sox. He twice led his league in wins and strikeouts.
Schilling was the Sporting News NL Pitcher of the Year in 2001 and 2002.
BEWARE: Yelp.com is a fraud!
http://scottworldblog.blogspot.com/2009/03/beware-yelpcom-is-fraud.html
Monday, March 23, 2009
BEWARE: Yelp.com is a fraud!
Scott Rose
Ladies and gentlemen, I would like to call your attention to a very nefarious website called yelp.com, which you should avoid at all costs.
Yelp.com has gained sort of a cult following as some sort of a reputable site where you can supposedly see how people in your community have rated local businesses. Well, I can tell you from firsthand experience that yelp.com is NOT reputable and they are NOT honest. In fact, Yelp even has the nerve to give themselves the slogan "Real People, Real Reviews", when it is anything but real people & real reviews on their site.
I wrote 6 reviews on the yelp.com site about 6 local businesses that I did business with: 3 of them were positive reviews and 3 of them were negative reviews. My negative reviews were very thoughtfully & carefully written and did not violate any of Yelp's terms of services. One of my negative reviews, for example, was for a taxicab company which never showed up to pick me up from my apartment, even though I waited 60 extra minutes past the arrival time for them to come, and after calling the taxicab company 5 times to check on where they were. ("Just 5 more minutes, Mr. Rose.")
Within 60 days of posting my 3 negative reviews (for 3 different companies) to Yelp's website, all 3 of my negative reviews had been removed from the respective companies' profiles on the Yelp site. Interestingly enough, the negative reviews still show up FOR MY EYES ONLY in my personal & private profile when I log into the Yelp website, but they have miraculously been HIDDEN on the companies' pages themselves.
So I started asking around, and lo and behold, many of my friends who had written negative reviews for businesses started noticing the same thing: their negative reviews were still in their own personal profiles (for their eyes only), but their negative reviews were NOWHERE TO BE FOUND on the company pages in question.
This phenomenon is starting to get some national press, too, but not nearly enough of an outcry as there should be over this potentially criminal activity. Check out these 3 articles for starters:
http://www.chicagotribune.com/business/technology/chi-0309-yelpmar09,0,3536868.story
http://apnews.excite.com/article/20090322/D9736TQG1.html
http://tinyurl.com/dfqazw
Yet people are still just sort of shrugging this off, as if this is something that we should be okay turning our back on.
The Chicago Tribune article is particularly interesting, because it highlights that Yelp is blackmailing companies for BOTH removing negative reviews AND for posting positive reviews. EVERYBODY is getting FUCKED HERE -- the businesses AND the consumers! The only people not getting fucked are Yelp themselves!
So I emailed yelp.com and asked them about my reviews being removed... they only replied to my emails with a form letter directing me to the FAQ's on the site. I replied back several times, asking to have a conversation with a supervisor about this issue, and they continually replied with form letters directing me to the FAQ's on their site. After trying to make live human contact with yelp.com on 5 separate occasions, I finally gave up.
I started bitching about this enough that a friend of mine told me that his business is on yelp.com. He told me that shortly after signing up for yelp.com, he got a call from the folks at yelp who offered him a deal that he just couldn't refuse. If he paid yelp.com a reasonable sum to advertise his company on their website, then yelp.com would suppress all negative reviews about his business. Sounds like Yelp has figured out a good little moneymaking business on the side, huh? And this explains why some negative reviews appear on the site for SOME companies, but not for other companies. Those companies who allow the negative reviews to show up about their own business are the ones who are truly the more honest & upstanding companies... because they didn't pay to have them suppressed. My friend also told me that he is allowed by yelp.com to write an unlimited number of positive reviews about his own company, under multiple identities, without suppression.
Pretty shady stuff, huh?
So, folks, I urge you to NEVER go to yelp.com and NEVER support this fraudulent, criminal website which pretends to be something that it is not.
Instead, I encourage you to use Citysearch.com instead, where I have not encountered these same problems. Citysearch.com actually DOES seem to have "real reviews by real people."
Monday, March 23, 2009
BEWARE: Yelp.com is a fraud!
Scott Rose
Ladies and gentlemen, I would like to call your attention to a very nefarious website called yelp.com, which you should avoid at all costs.
Yelp.com has gained sort of a cult following as some sort of a reputable site where you can supposedly see how people in your community have rated local businesses. Well, I can tell you from firsthand experience that yelp.com is NOT reputable and they are NOT honest. In fact, Yelp even has the nerve to give themselves the slogan "Real People, Real Reviews", when it is anything but real people & real reviews on their site.
I wrote 6 reviews on the yelp.com site about 6 local businesses that I did business with: 3 of them were positive reviews and 3 of them were negative reviews. My negative reviews were very thoughtfully & carefully written and did not violate any of Yelp's terms of services. One of my negative reviews, for example, was for a taxicab company which never showed up to pick me up from my apartment, even though I waited 60 extra minutes past the arrival time for them to come, and after calling the taxicab company 5 times to check on where they were. ("Just 5 more minutes, Mr. Rose.")
Within 60 days of posting my 3 negative reviews (for 3 different companies) to Yelp's website, all 3 of my negative reviews had been removed from the respective companies' profiles on the Yelp site. Interestingly enough, the negative reviews still show up FOR MY EYES ONLY in my personal & private profile when I log into the Yelp website, but they have miraculously been HIDDEN on the companies' pages themselves.
So I started asking around, and lo and behold, many of my friends who had written negative reviews for businesses started noticing the same thing: their negative reviews were still in their own personal profiles (for their eyes only), but their negative reviews were NOWHERE TO BE FOUND on the company pages in question.
This phenomenon is starting to get some national press, too, but not nearly enough of an outcry as there should be over this potentially criminal activity. Check out these 3 articles for starters:
http://www.chicagotribune.com/business/technology/chi-0309-yelpmar09,0,3536868.story
http://apnews.excite.com/article/20090322/D9736TQG1.html
http://tinyurl.com/dfqazw
Yet people are still just sort of shrugging this off, as if this is something that we should be okay turning our back on.
The Chicago Tribune article is particularly interesting, because it highlights that Yelp is blackmailing companies for BOTH removing negative reviews AND for posting positive reviews. EVERYBODY is getting FUCKED HERE -- the businesses AND the consumers! The only people not getting fucked are Yelp themselves!
So I emailed yelp.com and asked them about my reviews being removed... they only replied to my emails with a form letter directing me to the FAQ's on the site. I replied back several times, asking to have a conversation with a supervisor about this issue, and they continually replied with form letters directing me to the FAQ's on their site. After trying to make live human contact with yelp.com on 5 separate occasions, I finally gave up.
I started bitching about this enough that a friend of mine told me that his business is on yelp.com. He told me that shortly after signing up for yelp.com, he got a call from the folks at yelp who offered him a deal that he just couldn't refuse. If he paid yelp.com a reasonable sum to advertise his company on their website, then yelp.com would suppress all negative reviews about his business. Sounds like Yelp has figured out a good little moneymaking business on the side, huh? And this explains why some negative reviews appear on the site for SOME companies, but not for other companies. Those companies who allow the negative reviews to show up about their own business are the ones who are truly the more honest & upstanding companies... because they didn't pay to have them suppressed. My friend also told me that he is allowed by yelp.com to write an unlimited number of positive reviews about his own company, under multiple identities, without suppression.
Pretty shady stuff, huh?
So, folks, I urge you to NEVER go to yelp.com and NEVER support this fraudulent, criminal website which pretends to be something that it is not.
Instead, I encourage you to use Citysearch.com instead, where I have not encountered these same problems. Citysearch.com actually DOES seem to have "real reviews by real people."
STICK YOUR DAMN HAND IN IT
STICK YOUR DAMN HAND IN IT
20th Birthday of the Exxon Valdez Lie
by Greg Palast
March 23, 2009
"Gail, Please! Stick your hand in it!"
The petite Eskimo-Chugach woman gave me that you-dumb-ass-white-boy look.
"Gail, Gail. STICK YOUR DAMN HAND IN IT!"
She stuck it in, under the gravel of the beach at Sleepy Bay, her village's fishing ground. Gail's hand came up dripping with black, sickening goo. It could make you vomit. Oil from the Exxon Valdez.
It was already two years after the spill and Exxon had crowed that Mother Nature had happily cleaned up their stinking oil mess for them. It was a lie. But the media wouldn't question the bald-faced bullshit. And who the hell was going to investigate Exxon's claim way out in some godforsaken Native village in the Prince William Sound?
So I convinced the Natives to fly the lazy-ass reporters out to Sleepy Bay on rented float planes to see the oil that Exxon said wasn't there.
The reporters looked, but didn't see it, because it was three inches under their feet, under the shingle rock of the icy beach. Gail pulled out her hand and now the whole place smelled like a gas station. The network crews wanted to puke.
And now, with their eyes open, they saw the oil, the vile feces-colored smear across the glaciated ridge faces, the poisonous "bathtub ring" that ran for miles and miles at the high tide level. And it's still there. Less for sure. But twenty years later, IT'S STILL THERE, GODDAMNIT. And I want YOU, dear reader, to stick your hand in it. I want YOU, President Obama, to stick your hand in it before you blithely fulfill your Palin-esque campaign promise for a little more offshore drilling.
***
Tuesday marks the 20th Anniversary of the Exxon Valdez grounding and the smearing of 1,200 miles of Alaska's coastline with its oil.
It also marks the 20th Anniversary of a lie. Lots of lies: catalogued in a four-volume investigation of the disaster; four volumes you'll never see. I wrote that report, with my team of investigators working with the Natives preparing fraud and racketeering charges against Exxon. You'll never see the report because Exxon lawyers threatened the Natives, "Mention the f-word [fraud] and you'll never get a dime" of compensation to clean up the villages. The Natives agreed to drop the fraud charge -- and Exxon stiffed them on the money. You're surprised, right?
***
Doubtless, for the 20th Anniversary of the Great Spill, the media will schlep out that old story that the tanker ran aground because its captain was drunk at the wheel. Bullshit. Yes, the captain was "three sheets to the wind" -- but sleeping it off below-decks. The ship was in the hands of the third mate who was driving blind. That is, the Exxon Valdez' Raycas radar system was turned off; turned off because it was busted and had been busted since its maiden voyage. Exxon didn't want to spend the cash to fix it. So the man at the helm, electronically blindfolded, drove it up onto the reef.
So why the story of the drunken skipper? Because it lets Exxon off the hook: Calling it a case of "drunk driving" turns the disaster into a case of human error, not corporate penny-pinching
Indeed, the "human error" tale was the hook used by the Bush-stacked Supreme Court to slash the punitive damages awarded against Exxon by 90%, from $5 billion, to half a billion for 30,000 Natives and fishermen. Chief Justice John Roberts erased almost all of the payment due with the la-dee-dah comment, "What more can a corporation do?"
Well, here's what they could have done: Besides fix the radar, Exxon could have set out equipment to contain the spill. Containing a spill is actually quite simple. Stick a rubber skirt around the oil slick and suck it back up. The law requires it and Exxon promised it.
So, when the tanker hit, where was the rubber skirt and where was the sucker? Answer: The rubber skirt, called "boom" -- was a fiction. Exxon promised to have it sitting right there near the Native village at Bligh Reef. The oil company fulfilled that promised the cheap way: they lied.
And the lie was engineered at the very top. After the spill, we got our hands on a series of memos describing a secret meeting of chief executives of Exxon and its oil company partners, including ARCO, a unit of British Petroleum. In a meeting of these oil chieftains held in April 1988, ten months before the spill, Exxon rejected a plea from T.L. Polasek, the Vice-President of its Alaska shipping operations, to provide the oil spill containment equipment required by law. Polasek warned the CEOs it was "not possible" to contain a spill in the mid-Sound without the emergency set-up.
Exxon angrily vetoed ARCO's suggestion that the oil companies supply the rubber skirts and other materiel that would have prevented the spill from spreading, virtually eliminating the spill's damage.
Regulations state that no tanker may leave the Alaska port of Valdez without the "sucker" equipment, called a "containment barge," at the ready. Exxon signed off on the barge's readiness. But, that night twenty years ago, the barge was in dry-dock with its pumps locked up under arctic ice. By the time it arrived at the tanker, half a day after the spill, the oil was well along its thousand-mile killing path.
Natives watched as the now-unstoppable oil overwhelmed their islands. Eyak Native elder Henry Makarka saw an otter rip out its own eyes burning from oil residue. Henry, pointing down a waterside dead-zone, told me, in a mix of Alutiiq and English, "If I had a machine gun, I'd shoot every one of those white sons-of-bitches."
***
Exxon promised -- promised -- to pay the Natives and other fisherman for all their losses. The Chief of the Natives at Nanwalek lost his boat to bankruptcy. His village, like other villages, Native and non-Native, decayed into alcoholism. The Mayor of fishing port Cordova killed himself, citing Exxon in his suicide note.
On the island village of Chenega, Gail Evanoff's uncle Paul Kompkoff was hungry. Until the spill, he had lived on seal meat, razor clams and salmon Chenegans would catch, and on deer they hunted. The clams and salmon were declared deadly and the deer, not able to read the government warning signs, ate the poisoned vegetation and died.
The President of Exxon, Lee Raymond, helicoptered into Chenega for a photo op. He promised to compensate the Natives and all fishermen for their losses, and Exxon would thoroughly clean the beaches.
Uncle Paul told the Exxon chief of his hunger. The oil company, sensing PR disaster, shipped in seal meat to the isolated village. The cans were marked, "NOT FIT FOR HUMAN CONSUMPTION." Uncle Paul said, "Zoo food."
Paul didn't want a seal in a can. He wanted a boat to go fishing, to bring the village back to life.
Two years after the spill, Otto Harrison, General Manager of Exxon USA, told Evanoff and me to forget about a fishing boat for Uncle Paul. Exxon was immortal and Natives were not. The company would litigate for 20 years.
They did. Only now, two decades on, Exxon has finally begun its payout of the court award -- but only ten cents on the dollar. And Uncle Paul's boat? No matter. Paul's dead. So are a third of the fishermen owed the money.
***
Lee Raymond, President of Exxon at the time of the spill -- and its President when the company made the secret decision to do without oil spill equipment, retired in April 2006. The company awarded him a $400 million retirement bonus, more than double the bonuses received by all AIG executives combined.
***
Gail's oily hand never made it to national television. The networks were distracted with another oil story.
After sailing back to Chenega from Sleepy Bay, I sat with Uncle Paul, watching the smart bombs explode over Baghdad. Gulf War I had begun.
Uncle Paul was silent a long time. The generals on CNN pointed to the burning oil fields near Basra. Paul said, "I guess were all some kind of Native now."
************
For SuicideGirls.com
Greg Palast investigated fraud and racketeering claims for the Chugach Natives of Alaska. Now a journalist whose work appears on BBC Television Newsnight, Palast is the author of the New York Times bestselling books The Best Democracy Money Can Buy and Armed Madhouse. Visit GregPalast.com for more.
Check out the YouTube clip of Greg Palast on Air America's 'Ring of Fire' with Mike Papantonio on the Exxon Valdez and on the death of investigative reporting in America. Listen in this weekend on your Air America station.
And get ready: This Friday - the launch of GREG PALAST INVESTIGATES - On the Trail with investigative reporter Palast - with three of his latest ass-kicking BBC Television reports.
Palast is looking for co-producers for the film's DVD release. Support the team behind the work that the Chicago Tribune calls, "Stories so relevant, they threaten to alter history." Pre-order the DVD today.
Palast is a Nation Institute/Puffin Foundation Writing Fellow for investigative reporting.
20th Birthday of the Exxon Valdez Lie
by Greg Palast
March 23, 2009
"Gail, Please! Stick your hand in it!"
The petite Eskimo-Chugach woman gave me that you-dumb-ass-white-boy look.
"Gail, Gail. STICK YOUR DAMN HAND IN IT!"
She stuck it in, under the gravel of the beach at Sleepy Bay, her village's fishing ground. Gail's hand came up dripping with black, sickening goo. It could make you vomit. Oil from the Exxon Valdez.
It was already two years after the spill and Exxon had crowed that Mother Nature had happily cleaned up their stinking oil mess for them. It was a lie. But the media wouldn't question the bald-faced bullshit. And who the hell was going to investigate Exxon's claim way out in some godforsaken Native village in the Prince William Sound?
So I convinced the Natives to fly the lazy-ass reporters out to Sleepy Bay on rented float planes to see the oil that Exxon said wasn't there.
The reporters looked, but didn't see it, because it was three inches under their feet, under the shingle rock of the icy beach. Gail pulled out her hand and now the whole place smelled like a gas station. The network crews wanted to puke.
And now, with their eyes open, they saw the oil, the vile feces-colored smear across the glaciated ridge faces, the poisonous "bathtub ring" that ran for miles and miles at the high tide level. And it's still there. Less for sure. But twenty years later, IT'S STILL THERE, GODDAMNIT. And I want YOU, dear reader, to stick your hand in it. I want YOU, President Obama, to stick your hand in it before you blithely fulfill your Palin-esque campaign promise for a little more offshore drilling.
***
Tuesday marks the 20th Anniversary of the Exxon Valdez grounding and the smearing of 1,200 miles of Alaska's coastline with its oil.
It also marks the 20th Anniversary of a lie. Lots of lies: catalogued in a four-volume investigation of the disaster; four volumes you'll never see. I wrote that report, with my team of investigators working with the Natives preparing fraud and racketeering charges against Exxon. You'll never see the report because Exxon lawyers threatened the Natives, "Mention the f-word [fraud] and you'll never get a dime" of compensation to clean up the villages. The Natives agreed to drop the fraud charge -- and Exxon stiffed them on the money. You're surprised, right?
***
Doubtless, for the 20th Anniversary of the Great Spill, the media will schlep out that old story that the tanker ran aground because its captain was drunk at the wheel. Bullshit. Yes, the captain was "three sheets to the wind" -- but sleeping it off below-decks. The ship was in the hands of the third mate who was driving blind. That is, the Exxon Valdez' Raycas radar system was turned off; turned off because it was busted and had been busted since its maiden voyage. Exxon didn't want to spend the cash to fix it. So the man at the helm, electronically blindfolded, drove it up onto the reef.
So why the story of the drunken skipper? Because it lets Exxon off the hook: Calling it a case of "drunk driving" turns the disaster into a case of human error, not corporate penny-pinching
Indeed, the "human error" tale was the hook used by the Bush-stacked Supreme Court to slash the punitive damages awarded against Exxon by 90%, from $5 billion, to half a billion for 30,000 Natives and fishermen. Chief Justice John Roberts erased almost all of the payment due with the la-dee-dah comment, "What more can a corporation do?"
Well, here's what they could have done: Besides fix the radar, Exxon could have set out equipment to contain the spill. Containing a spill is actually quite simple. Stick a rubber skirt around the oil slick and suck it back up. The law requires it and Exxon promised it.
So, when the tanker hit, where was the rubber skirt and where was the sucker? Answer: The rubber skirt, called "boom" -- was a fiction. Exxon promised to have it sitting right there near the Native village at Bligh Reef. The oil company fulfilled that promised the cheap way: they lied.
And the lie was engineered at the very top. After the spill, we got our hands on a series of memos describing a secret meeting of chief executives of Exxon and its oil company partners, including ARCO, a unit of British Petroleum. In a meeting of these oil chieftains held in April 1988, ten months before the spill, Exxon rejected a plea from T.L. Polasek, the Vice-President of its Alaska shipping operations, to provide the oil spill containment equipment required by law. Polasek warned the CEOs it was "not possible" to contain a spill in the mid-Sound without the emergency set-up.
Exxon angrily vetoed ARCO's suggestion that the oil companies supply the rubber skirts and other materiel that would have prevented the spill from spreading, virtually eliminating the spill's damage.
Regulations state that no tanker may leave the Alaska port of Valdez without the "sucker" equipment, called a "containment barge," at the ready. Exxon signed off on the barge's readiness. But, that night twenty years ago, the barge was in dry-dock with its pumps locked up under arctic ice. By the time it arrived at the tanker, half a day after the spill, the oil was well along its thousand-mile killing path.
Natives watched as the now-unstoppable oil overwhelmed their islands. Eyak Native elder Henry Makarka saw an otter rip out its own eyes burning from oil residue. Henry, pointing down a waterside dead-zone, told me, in a mix of Alutiiq and English, "If I had a machine gun, I'd shoot every one of those white sons-of-bitches."
***
Exxon promised -- promised -- to pay the Natives and other fisherman for all their losses. The Chief of the Natives at Nanwalek lost his boat to bankruptcy. His village, like other villages, Native and non-Native, decayed into alcoholism. The Mayor of fishing port Cordova killed himself, citing Exxon in his suicide note.
On the island village of Chenega, Gail Evanoff's uncle Paul Kompkoff was hungry. Until the spill, he had lived on seal meat, razor clams and salmon Chenegans would catch, and on deer they hunted. The clams and salmon were declared deadly and the deer, not able to read the government warning signs, ate the poisoned vegetation and died.
The President of Exxon, Lee Raymond, helicoptered into Chenega for a photo op. He promised to compensate the Natives and all fishermen for their losses, and Exxon would thoroughly clean the beaches.
Uncle Paul told the Exxon chief of his hunger. The oil company, sensing PR disaster, shipped in seal meat to the isolated village. The cans were marked, "NOT FIT FOR HUMAN CONSUMPTION." Uncle Paul said, "Zoo food."
Paul didn't want a seal in a can. He wanted a boat to go fishing, to bring the village back to life.
Two years after the spill, Otto Harrison, General Manager of Exxon USA, told Evanoff and me to forget about a fishing boat for Uncle Paul. Exxon was immortal and Natives were not. The company would litigate for 20 years.
They did. Only now, two decades on, Exxon has finally begun its payout of the court award -- but only ten cents on the dollar. And Uncle Paul's boat? No matter. Paul's dead. So are a third of the fishermen owed the money.
***
Lee Raymond, President of Exxon at the time of the spill -- and its President when the company made the secret decision to do without oil spill equipment, retired in April 2006. The company awarded him a $400 million retirement bonus, more than double the bonuses received by all AIG executives combined.
***
Gail's oily hand never made it to national television. The networks were distracted with another oil story.
After sailing back to Chenega from Sleepy Bay, I sat with Uncle Paul, watching the smart bombs explode over Baghdad. Gulf War I had begun.
Uncle Paul was silent a long time. The generals on CNN pointed to the burning oil fields near Basra. Paul said, "I guess were all some kind of Native now."
************
For SuicideGirls.com
Greg Palast investigated fraud and racketeering claims for the Chugach Natives of Alaska. Now a journalist whose work appears on BBC Television Newsnight, Palast is the author of the New York Times bestselling books The Best Democracy Money Can Buy and Armed Madhouse. Visit GregPalast.com for more.
Check out the YouTube clip of Greg Palast on Air America's 'Ring of Fire' with Mike Papantonio on the Exxon Valdez and on the death of investigative reporting in America. Listen in this weekend on your Air America station.
And get ready: This Friday - the launch of GREG PALAST INVESTIGATES - On the Trail with investigative reporter Palast - with three of his latest ass-kicking BBC Television reports.
Palast is looking for co-producers for the film's DVD release. Support the team behind the work that the Chicago Tribune calls, "Stories so relevant, they threaten to alter history." Pre-order the DVD today.
Palast is a Nation Institute/Puffin Foundation Writing Fellow for investigative reporting.
Autobiography of a Monarch Butterfly
http://www.lulu.com/content/e-book/autobiography-of-a-monarch-butterfly/6524497Autobiography of a Monarch Butterfly
by Jaye Beldo
Download $6.00 (23306 kb)
Description:
In this autobiographical offering by writer, musician and artist Jaye Beldo, his life as an experimental subject in CIA MKULTRA and Biowarfare experiments is described. The author shows how meditation, yoga, holistic health, art, music, creative visualization, body work and other healing modalities have healed and unified his fragmented psyche and helped him over come mind control. Inspirational, disturbing, provocative, visionary and at times entertaining, this book is sure to encourage those who read it to realize that they can heal themselves and become free.
Keywords:
meditation mind control Conspiracy Jaye Beldo
Listed in:
Biographies & Memoirs
Copyright: © 2009 Jaye Beldo
Standard Copyright License
Language: English
Country: United States
Edition: First Edition
Thursday, March 26, 2009
Bill to tax bonuses an 'outrage' and unconstitutional
http://rawstory.com/news/2008/Paul_Bill_to_tax_bonuses_unconstitutional_0319.html
Paul: Bill to tax bonuses an 'outrage' and unconstitutional
David Edwards and Rachel Oswald
Thursday March 19, 2009
Rep. Ron Paul (R-TX) yet again went against the grain in Congress when he stood up in the House and argued against a proposal that would tax 90 percent of AIG executive bonuses, saying that it was a "disgrace," a "distraction" and an "outrage" that undermined the Constitution.
"I rise in opposition to this rule and the bill because of the problem -- because of the lack of need for this and the disgrace that this has brought upon us," Paul said. "Yesterday, for instance, the Federal Reserve met and they came out and they announced that they would create new money to the tune of $1.25 trillion."
Paul, a dark horse Republican candidate for president in 2008 who still enjoys considerable popularity with a base of hardcore supporters, noted that the value of the dollar went down significantly after that announcement by the Fed.
"Today...on emergency legislation, we're going to deal with $165 million of bonuses, which obviously shouldn't have never been given, but who's responsible for this?" Paul said. "It's the Congress and the president who signed this [$787 billion stimulus bill that allowed the bonuses to go forward]. So this is a distraction, this is an outrage."
He chided his fellow House members who were considering supporting the new tax legislation for only caring about the millions in bonuses when they should be concerned with the trillions in deficits the country is facing.
"So everybody can go home that voted for this bill, say, 'Look, I'm clamping [down] on this $165 million but I don't care about the previous $5 trillion the Fed created and the $1.25 trillion they created yesterday,'" he said. "Think of the loss of purchasing power in less than 24 hours."
Paul urged his House members to support his bill, H.R. 1207, which would change the way the Federal Reserve is audited.
"Let's quit appropriating funds in an unconstitutional manner. Let's quit bankrupting this country," Paul said. "The Fed is not even required to answer any questions. So it's about time we have an open book about the Federal Reserve and solve some of these problems."
House passes tax bill Thursday afternoon
Despite the protestations of Paul and a few others, the House voted overwhelmingly to pass the bonus tax legislation Thursday afternoon.
Roll Call reports the vote was 328-93 to impose a 90 percent tax on employee bonuses at companies that received federal bailout funds.
"While the vote was bipartisan, the GOP was split on the bill, with Minority Leader John Boehner (Ohio) voting against it and Minority Whip Eric Cantor (Va.) voting in favor of it," reported Roll Call.
CNN notes that the measure, which now heads to the Senate for consideration, would tax individuals on any bonuses received in 2009 from companies getting $5 billion or more in money from the Troubled Asset Relief Program. Those with incomes more than $250,000 would see their bonuses taxed at the 90 percent rate.
"We can't have any concept of we're getting even, but we must have a concept that we're trying to show that Congress ... cannot tolerate that," said Charlie Rangel (D-NY), chairman of the House Ways and Means Committee on Wednesday.
Said House Speaker Nancy Pelosi, "We must also protect the American taxpayer from executives who would use their companies' second chances as opportunities for private gain. Because they could not use sound judgment in the use of taxpayer funds, these AIG executives will pay the Treasury in the form of this tax."
Speaking before the House on Thursday, Boehner questioned why they were only taxing 90 percent of the bonuses.
"Why 90 percent?... We can get 100 percent back because the Treasury Secretary has the ability to get it all back. The Administration has the ability to get it all back," Boehner said. "Why don’t we just get it all back? Why are we bringing this bill to the floor today to give members political cover when in fact the Treasury Secretary has the authority, the Administration has the authority to get all of it back?"
Paul: Bill to tax bonuses an 'outrage' and unconstitutional
David Edwards and Rachel Oswald
Thursday March 19, 2009
Rep. Ron Paul (R-TX) yet again went against the grain in Congress when he stood up in the House and argued against a proposal that would tax 90 percent of AIG executive bonuses, saying that it was a "disgrace," a "distraction" and an "outrage" that undermined the Constitution.
"I rise in opposition to this rule and the bill because of the problem -- because of the lack of need for this and the disgrace that this has brought upon us," Paul said. "Yesterday, for instance, the Federal Reserve met and they came out and they announced that they would create new money to the tune of $1.25 trillion."
Paul, a dark horse Republican candidate for president in 2008 who still enjoys considerable popularity with a base of hardcore supporters, noted that the value of the dollar went down significantly after that announcement by the Fed.
"Today...on emergency legislation, we're going to deal with $165 million of bonuses, which obviously shouldn't have never been given, but who's responsible for this?" Paul said. "It's the Congress and the president who signed this [$787 billion stimulus bill that allowed the bonuses to go forward]. So this is a distraction, this is an outrage."
He chided his fellow House members who were considering supporting the new tax legislation for only caring about the millions in bonuses when they should be concerned with the trillions in deficits the country is facing.
"So everybody can go home that voted for this bill, say, 'Look, I'm clamping [down] on this $165 million but I don't care about the previous $5 trillion the Fed created and the $1.25 trillion they created yesterday,'" he said. "Think of the loss of purchasing power in less than 24 hours."
Paul urged his House members to support his bill, H.R. 1207, which would change the way the Federal Reserve is audited.
"Let's quit appropriating funds in an unconstitutional manner. Let's quit bankrupting this country," Paul said. "The Fed is not even required to answer any questions. So it's about time we have an open book about the Federal Reserve and solve some of these problems."
House passes tax bill Thursday afternoon
Despite the protestations of Paul and a few others, the House voted overwhelmingly to pass the bonus tax legislation Thursday afternoon.
Roll Call reports the vote was 328-93 to impose a 90 percent tax on employee bonuses at companies that received federal bailout funds.
"While the vote was bipartisan, the GOP was split on the bill, with Minority Leader John Boehner (Ohio) voting against it and Minority Whip Eric Cantor (Va.) voting in favor of it," reported Roll Call.
CNN notes that the measure, which now heads to the Senate for consideration, would tax individuals on any bonuses received in 2009 from companies getting $5 billion or more in money from the Troubled Asset Relief Program. Those with incomes more than $250,000 would see their bonuses taxed at the 90 percent rate.
"We can't have any concept of we're getting even, but we must have a concept that we're trying to show that Congress ... cannot tolerate that," said Charlie Rangel (D-NY), chairman of the House Ways and Means Committee on Wednesday.
Said House Speaker Nancy Pelosi, "We must also protect the American taxpayer from executives who would use their companies' second chances as opportunities for private gain. Because they could not use sound judgment in the use of taxpayer funds, these AIG executives will pay the Treasury in the form of this tax."
Speaking before the House on Thursday, Boehner questioned why they were only taxing 90 percent of the bonuses.
"Why 90 percent?... We can get 100 percent back because the Treasury Secretary has the ability to get it all back. The Administration has the ability to get it all back," Boehner said. "Why don’t we just get it all back? Why are we bringing this bill to the floor today to give members political cover when in fact the Treasury Secretary has the authority, the Administration has the authority to get all of it back?"
The Real AIG Scandal
http://www.slate.com/id/2213942/
The Real AIG Scandal
It's not the bonuses. It's that AIG's counterparties are getting paid back in full.
By Eliot Spitzer
Tuesday, March 17, 2009
Everybody is rushing to condemn AIG's bonuses, but this simple scandal is obscuring the real disgrace at the insurance giant: Why are AIG's counterparties getting paid back in full, to the tune of tens of billions of taxpayer dollars?
For the answer to this question, we need to go back to the very first decision to bail out AIG, made, we are told, by then-Treasury Secretary Henry Paulson, then-New York Fed official Timothy Geithner, Goldman Sachs CEO Lloyd Blankfein, and Fed Chairman Ben Bernanke last fall. Post-Lehman's collapse, they feared a systemic failure could be triggered by AIG's inability to pay the counterparties to all the sophisticated instruments AIG had sold. And who were AIG's trading partners? No shock here: Goldman, Bank of America, Merrill Lynch, UBS, JPMorgan Chase, Morgan Stanley, Deutsche Bank, Barclays, and on it goes. So now we know for sure what we already surmised: The AIG bailout has been a way to hide an enormous second round of cash to the same group that had received TARP money already.
It all appears, once again, to be the same insiders protecting themselves against sharing the pain and risk of their own bad adventure. The payments to AIG's counterparties are justified with an appeal to the sanctity of contract. If AIG's contracts turned out to be shaky, the theory goes, then the whole edifice of the financial system would collapse.
But wait a moment, aren't we in the midst of reopening contracts all over the place to share the burden of this crisis? From raising taxes—income taxes to sales taxes—to properly reopening labor contracts, we are all being asked to pitch in and carry our share of the burden. Workers around the country are being asked to take pay cuts and accept shorter work weeks so that colleagues won't be laid off. Why can't Wall Street royalty shoulder some of the burden? Why did Goldman have to get back 100 cents on the dollar? Didn't we already give Goldman a $25 billion capital infusion, and aren't they sitting on more than $100 billion in cash? Haven't we been told recently that they are beginning to come back to fiscal stability? If that is so, couldn't they have accepted a discount, and couldn't they have agreed to certain conditions before the AIG dollars—that is, our dollars—flowed?
The appearance that this was all an inside job is overwhelming. AIG was nothing more than a conduit for huge capital flows to the same old suspects, with no reason or explanation.
So here are several questions that should be answered, in public, under oath, to clear the air:
What was the precise conversation among Bernanke, Geithner, Paulson, and Blankfein that preceded the initial $80 billion grant?
Was it already known who the counterparties were and what the exposure was for each of the counterparties?
What did Goldman, and all the other counterparties, know about AIG's financial condition at the time they executed the swaps or other contracts? Had they done adequate due diligence to see whether they were buying real protection? And why shouldn't they bear a percentage of the risk of failure of their own counterparty?
What is the deeper relationship between Goldman and AIG? Didn't they almost merge a few years ago but did not because Goldman couldn't get its arms around the black box that is AIG? If that is true, why should Goldman get bailed out? After all, they should have known as well as anybody that a big part of AIG's business model was not to pay on insurance it had issued.
Why weren't the counterparties immediately and fully disclosed?
Failure to answer these questions will feed the populist rage that is metastasizing very quickly. And it will raise basic questions about the competence of those who are supposedly guiding this economic policy.
The Real AIG Scandal
It's not the bonuses. It's that AIG's counterparties are getting paid back in full.
By Eliot Spitzer
Tuesday, March 17, 2009
Everybody is rushing to condemn AIG's bonuses, but this simple scandal is obscuring the real disgrace at the insurance giant: Why are AIG's counterparties getting paid back in full, to the tune of tens of billions of taxpayer dollars?
For the answer to this question, we need to go back to the very first decision to bail out AIG, made, we are told, by then-Treasury Secretary Henry Paulson, then-New York Fed official Timothy Geithner, Goldman Sachs CEO Lloyd Blankfein, and Fed Chairman Ben Bernanke last fall. Post-Lehman's collapse, they feared a systemic failure could be triggered by AIG's inability to pay the counterparties to all the sophisticated instruments AIG had sold. And who were AIG's trading partners? No shock here: Goldman, Bank of America, Merrill Lynch, UBS, JPMorgan Chase, Morgan Stanley, Deutsche Bank, Barclays, and on it goes. So now we know for sure what we already surmised: The AIG bailout has been a way to hide an enormous second round of cash to the same group that had received TARP money already.
It all appears, once again, to be the same insiders protecting themselves against sharing the pain and risk of their own bad adventure. The payments to AIG's counterparties are justified with an appeal to the sanctity of contract. If AIG's contracts turned out to be shaky, the theory goes, then the whole edifice of the financial system would collapse.
But wait a moment, aren't we in the midst of reopening contracts all over the place to share the burden of this crisis? From raising taxes—income taxes to sales taxes—to properly reopening labor contracts, we are all being asked to pitch in and carry our share of the burden. Workers around the country are being asked to take pay cuts and accept shorter work weeks so that colleagues won't be laid off. Why can't Wall Street royalty shoulder some of the burden? Why did Goldman have to get back 100 cents on the dollar? Didn't we already give Goldman a $25 billion capital infusion, and aren't they sitting on more than $100 billion in cash? Haven't we been told recently that they are beginning to come back to fiscal stability? If that is so, couldn't they have accepted a discount, and couldn't they have agreed to certain conditions before the AIG dollars—that is, our dollars—flowed?
The appearance that this was all an inside job is overwhelming. AIG was nothing more than a conduit for huge capital flows to the same old suspects, with no reason or explanation.
So here are several questions that should be answered, in public, under oath, to clear the air:
What was the precise conversation among Bernanke, Geithner, Paulson, and Blankfein that preceded the initial $80 billion grant?
Was it already known who the counterparties were and what the exposure was for each of the counterparties?
What did Goldman, and all the other counterparties, know about AIG's financial condition at the time they executed the swaps or other contracts? Had they done adequate due diligence to see whether they were buying real protection? And why shouldn't they bear a percentage of the risk of failure of their own counterparty?
What is the deeper relationship between Goldman and AIG? Didn't they almost merge a few years ago but did not because Goldman couldn't get its arms around the black box that is AIG? If that is true, why should Goldman get bailed out? After all, they should have known as well as anybody that a big part of AIG's business model was not to pay on insurance it had issued.
Why weren't the counterparties immediately and fully disclosed?
Failure to answer these questions will feed the populist rage that is metastasizing very quickly. And it will raise basic questions about the competence of those who are supposedly guiding this economic policy.
Dodd Blames Obama Administration
http://www.bloomberg.com/apps/news?pid=washingtonstory&sid=aT_tMXRy2vDs
Dodd Blames Obama Administration for Bonus Amendment
By Ryan J. Donmoyer
March 19 (Bloomberg) -- Senate Banking Committee Chairman Christopher Dodd said the Obama administration asked him to insert a provision in last month’s $787 billion economic-stimulus legislation that had the effect of authorizing American International Group Inc.’s bonuses.
Dodd, a Connecticut Democrat, said yesterday he agreed to modify restrictions on executive pay at companies receiving taxpayer assistance to exempt bonuses already agreed upon in contracts. He said he did so without realizing the change would benefit AIG, whose recent $165 million payment to employees has sparked a public furor.
Dodd said he had wanted to limit executive compensation at companies that got money from the government’s financial-rescue fund. AIG has received $173 billion in bailout money. His provision was changed as the stimulus legislation was negotiated between the House and Senate.
“I did not want to make any changes to my original Senate-passed amendment” to the stimulus bill, “but I did so at the request of administration officials, who gave us no indication that this was in any way related to AIG,” Dodd said in a statement released last night. “Let me be clear -- I was completely unaware of these AIG bonuses until I learned of them last week.” He didn’t name the administration officials who made the request.
No Insistence
An administration official said last night that representatives of President Barack Obama didn’t insist on the change, though they did contend that the language in Dodd’s amendment could be legally challenged because it would apply retroactively to bonus agreements. The official spoke on the condition of anonymity.
That provision in the stimulus bill may undercut complaints by congressional Democrats about the AIG bonuses because most of them voted for the legislation. No Republicans in the House and only three in the Senate supported the stimulus measure.
“Taxpayers deserve better than this from their government, and this is just the latest reason why legislation must be transparent for all Americans to see before it is recklessly signed into law,” said Eric Cantor, the No. 2 Republican in the House.
The new law, approved by Congress Feb. 13 and signed into law by Obama the next week, effectively authorized bonus arrangements at companies receiving taxpayer bailouts as long as they were in place before Feb. 11. The AIG bonuses qualified under that provision.
Obama and many lawmakers who voted for the legislation, such as Senator Charles Schumer, a New York Democrat, and Senate Finance Committee Chairman Max Baucus, a Montana Democrat, are demanding AIG employees surrender their bonuses.
Schumer Letter
Schumer yesterday sent a letter to AIG Chief Executive Officer Edward Liddy warning him to return bonuses or face confiscatory taxes on them. The letter was signed by Senate Majority leader Harry Reid, a Nevada Democrat, and seven other senators.
Brian Fallon, a spokesman for Schumer, said the senator “supported a provision on the Senate floor that would have prevented these types of bonuses, but he was not on the conference committee that negotiated the final language.”
A House vote is planned for today on a bill to impose a 90 percent tax on executive bonuses paid by AIG and other companies getting more than $5 billion in federal bailout funds.
“I expect it to pass in overwhelmingly bipartisan fashion,” House Majority Leader Steny Hoyer, a Maryland Democrat, told reporters yesterday in Washington.
Republican Attacks
Republicans seized on the provision in the stimulus bill to paint Democrats as hypocrites.
“The fact is that the bill the president signed, which protected the AIG bonuses and others, was written behind closed doors by Democratic leaders of the House and Senate,” Iowa Senator Charles Grassley said in a statement.
AIG donated a total of $854,905 to political campaigns in 2008, according to the Center for Responsive Politics, a Washington-based research group. AIG employees as a group represent Dodd’s fourth-biggest donor during his career, the group’s research shows. The company’s political action committee, employees and immediate family members have given Dodd more than $280,000, the group said.
Dodd said the provision was written to give the Treasury Department enough discretion to reclaim bonuses as necessary.
“Fortunately, we wrote this amendment in a way that allows the Treasury Department to go back and review these bonus contracts and seek to recover the money for taxpayers,” he said.
Treasury Secretary Timothy Geithner told lawmakers in a letter this week that department lawyers believe it would be “legally difficult” to prevent AIG from paying bonuses.
Other Democrats who voted for the stimulus bill have ramped up criticism of AIG’s bonuses, including Massachusetts Representative Barney Frank, the chairman of the House Financial Services Committee, who told reporters, “I think the time has come to exercise our ownership rights.”
To contact the reporter on this story: Ryan J. Donmoyer in Washington at rdonmoyer@bloomberg.net
Dodd Blames Obama Administration for Bonus Amendment
By Ryan J. Donmoyer
March 19 (Bloomberg) -- Senate Banking Committee Chairman Christopher Dodd said the Obama administration asked him to insert a provision in last month’s $787 billion economic-stimulus legislation that had the effect of authorizing American International Group Inc.’s bonuses.
Dodd, a Connecticut Democrat, said yesterday he agreed to modify restrictions on executive pay at companies receiving taxpayer assistance to exempt bonuses already agreed upon in contracts. He said he did so without realizing the change would benefit AIG, whose recent $165 million payment to employees has sparked a public furor.
Dodd said he had wanted to limit executive compensation at companies that got money from the government’s financial-rescue fund. AIG has received $173 billion in bailout money. His provision was changed as the stimulus legislation was negotiated between the House and Senate.
“I did not want to make any changes to my original Senate-passed amendment” to the stimulus bill, “but I did so at the request of administration officials, who gave us no indication that this was in any way related to AIG,” Dodd said in a statement released last night. “Let me be clear -- I was completely unaware of these AIG bonuses until I learned of them last week.” He didn’t name the administration officials who made the request.
No Insistence
An administration official said last night that representatives of President Barack Obama didn’t insist on the change, though they did contend that the language in Dodd’s amendment could be legally challenged because it would apply retroactively to bonus agreements. The official spoke on the condition of anonymity.
That provision in the stimulus bill may undercut complaints by congressional Democrats about the AIG bonuses because most of them voted for the legislation. No Republicans in the House and only three in the Senate supported the stimulus measure.
“Taxpayers deserve better than this from their government, and this is just the latest reason why legislation must be transparent for all Americans to see before it is recklessly signed into law,” said Eric Cantor, the No. 2 Republican in the House.
The new law, approved by Congress Feb. 13 and signed into law by Obama the next week, effectively authorized bonus arrangements at companies receiving taxpayer bailouts as long as they were in place before Feb. 11. The AIG bonuses qualified under that provision.
Obama and many lawmakers who voted for the legislation, such as Senator Charles Schumer, a New York Democrat, and Senate Finance Committee Chairman Max Baucus, a Montana Democrat, are demanding AIG employees surrender their bonuses.
Schumer Letter
Schumer yesterday sent a letter to AIG Chief Executive Officer Edward Liddy warning him to return bonuses or face confiscatory taxes on them. The letter was signed by Senate Majority leader Harry Reid, a Nevada Democrat, and seven other senators.
Brian Fallon, a spokesman for Schumer, said the senator “supported a provision on the Senate floor that would have prevented these types of bonuses, but he was not on the conference committee that negotiated the final language.”
A House vote is planned for today on a bill to impose a 90 percent tax on executive bonuses paid by AIG and other companies getting more than $5 billion in federal bailout funds.
“I expect it to pass in overwhelmingly bipartisan fashion,” House Majority Leader Steny Hoyer, a Maryland Democrat, told reporters yesterday in Washington.
Republican Attacks
Republicans seized on the provision in the stimulus bill to paint Democrats as hypocrites.
“The fact is that the bill the president signed, which protected the AIG bonuses and others, was written behind closed doors by Democratic leaders of the House and Senate,” Iowa Senator Charles Grassley said in a statement.
AIG donated a total of $854,905 to political campaigns in 2008, according to the Center for Responsive Politics, a Washington-based research group. AIG employees as a group represent Dodd’s fourth-biggest donor during his career, the group’s research shows. The company’s political action committee, employees and immediate family members have given Dodd more than $280,000, the group said.
Dodd said the provision was written to give the Treasury Department enough discretion to reclaim bonuses as necessary.
“Fortunately, we wrote this amendment in a way that allows the Treasury Department to go back and review these bonus contracts and seek to recover the money for taxpayers,” he said.
Treasury Secretary Timothy Geithner told lawmakers in a letter this week that department lawyers believe it would be “legally difficult” to prevent AIG from paying bonuses.
Other Democrats who voted for the stimulus bill have ramped up criticism of AIG’s bonuses, including Massachusetts Representative Barney Frank, the chairman of the House Financial Services Committee, who told reporters, “I think the time has come to exercise our ownership rights.”
To contact the reporter on this story: Ryan J. Donmoyer in Washington at rdonmoyer@bloomberg.net
Outcry Builds in Washington
http://www.nytimes.com/2009/03/19/business/19bailout.html
March 19, 2009
Outcry Builds in Washington for Recovery of A.I.G. Bonuses
By JACKIE CALMES and LOUISE STORY
WASHINGTON — The bonuses that the American International Group awarded last week were paid to 418 employees and included $33.6 million for 52 people who have left the failed insurance conglomerate, according to the office of the New York attorney general.
Those payouts are expected to come under intense scrutiny Wednesday as Edward Liddy, the chief executive of A.I.G, testifies before Congress amid mounting public outrage about the bonuses, which were paid out after nearly $200 billion in taxpayer funds were pumped into the company.
The company paid the bonuses, including more than $1 million each to 73 people, to almost all of the employees in the financial products unit responsible for creating the exotic derivatives that caused A.I.G.’s near collapse and started the government rescue to avoid a global financial crisis.
The information adds to the firestorm confronting the Obama administration and Congress since the weekend disclosure that A.I.G., almost 80 percent owned by the government, paid out $165 million in bonuses.
Even before the New York attorney general, Andrew M. Cuomo, divulged the new data on bonus payments in a letter to Representative Barney Frank, the Massachusetts Democrat and chairman of the Financial Services Committee, the White House and Congress separately were rushing to get out in front of the mounting public furor. Officials and lawmakers condemned A.I.G., pointed fingers at each other and promised speedy action to recoup the taxpayers’ money.
Mr. Liddy, who took over as A.I.G. chief executive after the bailout for a salary of $1 a year, is scheduled to testify Wednesday morning before a subcommittee of the House Financial Services Committee.
New York’s efforts against A.I.G. have overshadowed those of the Treasury secretary, Timothy F. Geithner, the official who is responsible for the financial bailout, along with the Federal Reserve. The White House and Treasury have been besieged by questions about why Mr. Geithner did not know sooner about the bonus payments due this month, and whether he could have done more to stop them, prompting White House officials to assert President Obama’s continued confidence in Mr. Geithner.
“He more than has the president’s complete confidence,” said Rahm Emanuel, the White House chief of staff. As angry as the president is at the news about A.I.G., which he learned Thursday, Mr. Emanuel said, “his main priority is getting the financial system stabilized, and he believes this is a big distraction in that effort.”
The House speaker, Nancy Pelosi, on Tuesday asked three committee chairmen, including Mr. Frank, to come up with legislation to recoup the bonus money, and suggested the House might pass a measure as early as this week.
But the reaction of another of the chairmen, Representative Charles B. Rangel of the tax-writing Ways and Means Committee, underscored the legal and political complexities facing Democrats as they scramble for a solution. Mr. Rangel, a Democrat from New York, objected to one of the most popular ideas being floated — a confiscatory income tax on the recipients. The tax code is not “a political weapon,” he told reporters.
A.I.G. has refused to identify the current and former employees on privacy grounds, including one who received $6.4 million, but Mr. Cuomo is seeking to obtain and publicize their names.
The employees took salaries of $1 in exchange for receiving the bonuses, which were supposed to keep them from leaving A.I.G., according to Mr. Cuomo’s office. That, he suggested, undercuts A.I.G.’s claims that it could not renegotiate the bonus contracts agreed to early in 2008, and that the payments were “retention” bonuses.
“The only justification they had for this was, well, we needed to keep these people, but there are 50 people who left anyway or who they decided they didn’t need to keep,” Mr. Cuomo said in an interview.
A spokeswoman for A.I.G., Christina Pretto, declined to confirm the number of people reported to have received retention bonuses before leaving the financial products unit. She said it was common knowledge that A.I.G. was eliminating jobs in that division.
Late Tuesday, Mr. Geithner and White House officials sent a letter to Congress seeking quick action on legislation to give the government more power to intervene and wind down companies like A.I.G., which are huge players in the financial system, but are not regulated the way banks are.
The administration had planned to seek such regulatory powers as part of a broad revamping of financial regulations, but it is expediting this piece in response to the A.I.G. uproar.
In the letter, Mr. Geithner confirmed that the government would subtract $165 million — the amount of the bonuses — from the latest $30 billion loan to A.I.G. that would bring the total loans to $200 billion, from the original $85 billion.
Mr. Geithner reiterated the Treasury position that lawyers inside and out of government had agreed that “it would be legally difficult to prevent these contractually mandated payments.”
That position was being questioned at the Capitol. Congressional Republicans, eager to implicate Democrats, initially blamed Senator Christopher J. Dodd, the Connecticut Democrat who heads the banking committee, for adding to the economic recovery package an amendment that cracked down on bonuses at companies getting bailout money, but that exempted bonuses protected by contracts, like A.I.G.’s.
Mr. Dodd, in turn, responded Tuesday with a statement saying that the exemption actually had been inserted at the insistence of Treasury during Congress’s final legislative negotiations.
While the administration has been mostly on the defensive, the competing expressions of outrage in Congress throughout Tuesday belied the fact that a few less-prominent Democrats had tried to draw attention to the A.I.G. retention bonuses since last November. Except for their condemnations last December, response has been sparse on A.I.G.’s disbursement of an initial $55 million in retention payments.
While House leaders were calling for immediate legislation to recoup payments, Senate Democrats sent a letter to Mr. Liddy demanding that A.I.G. renegotiate the employees’ compensation contracts and return the bonuses. The Senate majority leader, Harry Reid, and other Democratic leaders proposed new taxes, some as high as 91 percent, on the bonuses. But some of the A.I.G. employees are thought to be foreigners based in offices abroad, and not liable for United States taxes.
Congressional Republicans, despite the Bush administration’s role in setting the terms of the A.I.G. bailout six months ago, blamed the Obama administration for lax oversight. Senator Richard Shelby, a Republican of Alabama, seemed to hint that Mr. Geithner should resign.
“This is just another example of where he seems to be out of the loop,” Mr. Shelby said. “Treasury should have let the American people know about this."
David Axelrod, senior adviser to the president, dismissed such talk, citing the financial mess that Mr. Geithner had inherited. “He has been confronted with a situation and challenges that are unparalleled in modern history, and to put it all on his shoulders is not fair and not right,” Mr. Axelrod said. “He’s a brilliant and committed guy with a great deal of experience in this area, and we’re standing with him.”
Jackie Calmes reported from Washington, and Louise Story from New York. Edmund L. Andrews and David M. Herszenhorn contributed reporting from Washington.
March 19, 2009
Outcry Builds in Washington for Recovery of A.I.G. Bonuses
By JACKIE CALMES and LOUISE STORY
WASHINGTON — The bonuses that the American International Group awarded last week were paid to 418 employees and included $33.6 million for 52 people who have left the failed insurance conglomerate, according to the office of the New York attorney general.
Those payouts are expected to come under intense scrutiny Wednesday as Edward Liddy, the chief executive of A.I.G, testifies before Congress amid mounting public outrage about the bonuses, which were paid out after nearly $200 billion in taxpayer funds were pumped into the company.
The company paid the bonuses, including more than $1 million each to 73 people, to almost all of the employees in the financial products unit responsible for creating the exotic derivatives that caused A.I.G.’s near collapse and started the government rescue to avoid a global financial crisis.
The information adds to the firestorm confronting the Obama administration and Congress since the weekend disclosure that A.I.G., almost 80 percent owned by the government, paid out $165 million in bonuses.
Even before the New York attorney general, Andrew M. Cuomo, divulged the new data on bonus payments in a letter to Representative Barney Frank, the Massachusetts Democrat and chairman of the Financial Services Committee, the White House and Congress separately were rushing to get out in front of the mounting public furor. Officials and lawmakers condemned A.I.G., pointed fingers at each other and promised speedy action to recoup the taxpayers’ money.
Mr. Liddy, who took over as A.I.G. chief executive after the bailout for a salary of $1 a year, is scheduled to testify Wednesday morning before a subcommittee of the House Financial Services Committee.
New York’s efforts against A.I.G. have overshadowed those of the Treasury secretary, Timothy F. Geithner, the official who is responsible for the financial bailout, along with the Federal Reserve. The White House and Treasury have been besieged by questions about why Mr. Geithner did not know sooner about the bonus payments due this month, and whether he could have done more to stop them, prompting White House officials to assert President Obama’s continued confidence in Mr. Geithner.
“He more than has the president’s complete confidence,” said Rahm Emanuel, the White House chief of staff. As angry as the president is at the news about A.I.G., which he learned Thursday, Mr. Emanuel said, “his main priority is getting the financial system stabilized, and he believes this is a big distraction in that effort.”
The House speaker, Nancy Pelosi, on Tuesday asked three committee chairmen, including Mr. Frank, to come up with legislation to recoup the bonus money, and suggested the House might pass a measure as early as this week.
But the reaction of another of the chairmen, Representative Charles B. Rangel of the tax-writing Ways and Means Committee, underscored the legal and political complexities facing Democrats as they scramble for a solution. Mr. Rangel, a Democrat from New York, objected to one of the most popular ideas being floated — a confiscatory income tax on the recipients. The tax code is not “a political weapon,” he told reporters.
A.I.G. has refused to identify the current and former employees on privacy grounds, including one who received $6.4 million, but Mr. Cuomo is seeking to obtain and publicize their names.
The employees took salaries of $1 in exchange for receiving the bonuses, which were supposed to keep them from leaving A.I.G., according to Mr. Cuomo’s office. That, he suggested, undercuts A.I.G.’s claims that it could not renegotiate the bonus contracts agreed to early in 2008, and that the payments were “retention” bonuses.
“The only justification they had for this was, well, we needed to keep these people, but there are 50 people who left anyway or who they decided they didn’t need to keep,” Mr. Cuomo said in an interview.
A spokeswoman for A.I.G., Christina Pretto, declined to confirm the number of people reported to have received retention bonuses before leaving the financial products unit. She said it was common knowledge that A.I.G. was eliminating jobs in that division.
Late Tuesday, Mr. Geithner and White House officials sent a letter to Congress seeking quick action on legislation to give the government more power to intervene and wind down companies like A.I.G., which are huge players in the financial system, but are not regulated the way banks are.
The administration had planned to seek such regulatory powers as part of a broad revamping of financial regulations, but it is expediting this piece in response to the A.I.G. uproar.
In the letter, Mr. Geithner confirmed that the government would subtract $165 million — the amount of the bonuses — from the latest $30 billion loan to A.I.G. that would bring the total loans to $200 billion, from the original $85 billion.
Mr. Geithner reiterated the Treasury position that lawyers inside and out of government had agreed that “it would be legally difficult to prevent these contractually mandated payments.”
That position was being questioned at the Capitol. Congressional Republicans, eager to implicate Democrats, initially blamed Senator Christopher J. Dodd, the Connecticut Democrat who heads the banking committee, for adding to the economic recovery package an amendment that cracked down on bonuses at companies getting bailout money, but that exempted bonuses protected by contracts, like A.I.G.’s.
Mr. Dodd, in turn, responded Tuesday with a statement saying that the exemption actually had been inserted at the insistence of Treasury during Congress’s final legislative negotiations.
While the administration has been mostly on the defensive, the competing expressions of outrage in Congress throughout Tuesday belied the fact that a few less-prominent Democrats had tried to draw attention to the A.I.G. retention bonuses since last November. Except for their condemnations last December, response has been sparse on A.I.G.’s disbursement of an initial $55 million in retention payments.
While House leaders were calling for immediate legislation to recoup payments, Senate Democrats sent a letter to Mr. Liddy demanding that A.I.G. renegotiate the employees’ compensation contracts and return the bonuses. The Senate majority leader, Harry Reid, and other Democratic leaders proposed new taxes, some as high as 91 percent, on the bonuses. But some of the A.I.G. employees are thought to be foreigners based in offices abroad, and not liable for United States taxes.
Congressional Republicans, despite the Bush administration’s role in setting the terms of the A.I.G. bailout six months ago, blamed the Obama administration for lax oversight. Senator Richard Shelby, a Republican of Alabama, seemed to hint that Mr. Geithner should resign.
“This is just another example of where he seems to be out of the loop,” Mr. Shelby said. “Treasury should have let the American people know about this."
David Axelrod, senior adviser to the president, dismissed such talk, citing the financial mess that Mr. Geithner had inherited. “He has been confronted with a situation and challenges that are unparalleled in modern history, and to put it all on his shoulders is not fair and not right,” Mr. Axelrod said. “He’s a brilliant and committed guy with a great deal of experience in this area, and we’re standing with him.”
Jackie Calmes reported from Washington, and Louise Story from New York. Edmund L. Andrews and David M. Herszenhorn contributed reporting from Washington.
California unemployment hits 10.5% in February
http://www.latimes.com/business/la-fi-caljobs21-2009mar21,1,7712508.story
California unemployment hits 10.5% in February
After 116,000 jobs are lost for the month, the state's unemployment rate is the highest since April 1983.
By Marc Lifsher
March 21, 2009
Reporting from Sacramento -- California employers led the nation in mass layoffs in February as the state's unemployment rate hit 10.5%, the highest level since April 1983, state and federal labor agencies reported Friday.
The reductions cascaded across all areas of the Golden State's economy, hitting major corporations that included Circuit City Stores Inc., Yahoo Inc., JPMorgan Chase & Co. bank, Ralphs Grocery Co. and the Los Angeles law firm of Latham & Watkins, among others.
Big companies, which must file mandatory government reports every time they lay off at least 50 employees, gave pink slips to 45,557 Californians last month.
Nationally, mass layoff events reached a record high in February, affecting 295,477 jobs in all industries tracked by the Bureau of Labor Statistics.
The biggest portion, about a third, were in manufacturing, followed by retail trade and transportation and warehousing.
California jobless rate
California's losses were far higher than Illinois', with 19,469 jobs lost. Pennsylvania and Wisconsin were third and fourth.
But the mass layoffs were only a modest portion of the damage done to the Golden State's economy because the bulk of jobs are at small and medium-size businesses.
In all, California lost 116,000 jobs in February, bringing the 12-month total to 605,900.
Layoffs began 18 months ago in residential construction and moved to finance and wholesale and retail trade. Now, the state numbers show that cutbacks are hitting the once-secure bastions of healthcare, education and government services, sending new waves of unemployed workers to job-hunting centers.
"The job losses are intensifying and becoming more broad-based," said Esmael Adibi, an economist at Chapman University in Orange.
Construction, which continues to weaken, suffered the most in February, shedding 30,900 jobs. All other industries reported declines, with the exception of information, which includes television and movie production.
"Even the sectors that were considered recession-proof are losing steam," Adibi said.
California's jobless rate rose four-tenths of a percentage point in February, from 10.1% in January. A year earlier the rate was 6.2%. Unemployment in Los Angeles County increased by a slightly larger margin, to 10.9% in February from a revised 10.4% in January and 6.1% a year earlier.
Last month's national rate was 8.1%.
Both federal and California laws require employers to report large layoffs, though details of the mandates differ.
The tempo of layoffs is speeding up, state government officials warn.
"Since October, we've been getting these increasingly larger losses of jobs," said Howard Roth, chief economist for the California Department of Finance. He noted that February job losses were the heaviest in a single month since at least 1990.
What's more, the pace of disappearing jobs is hitting California disproportionately hard, compared with the other 49 states. California, which accounts for 11% of the national workforce, has suffered 18% of U.S. job losses.
California in recent years has been plagued by average job growth, a reversal from the superheated dot-com boom of the late 1990s, said Stephen Levy, director and senior economist at the Center for the Continuing Study of the California Economy in Palo Alto.
Levy attributes the state's high unemployment rate to a combination of sharp job losses and a workforce that's ballooned by 350,000 people.
Growth, he said, "obviously depends on the success of national policies to boost employment and stabilize the housing and banking sectors."
That's what California Gov. Arnold Schwarzenegger, who met with President Obama on Friday at the White House, is counting on.
"My administration is working tirelessly with the federal government to pump federal economic stimulus funding into our economy to create jobs as quickly as possible," Schwarzenegger said in a statement. But, he cautioned, "the road to economic recovery will not be short."
The good economic news, meager as it might seem, is the assurance of federal aid from the Obama stimulus package and the Federal Reserve's move this week to ease credit, said Sung Won Sohn, an economist and Asian trade expert at Cal State Channel Islands.
"The federal help will not turn the economy around," he said, "but it will prevent the economy from getting worse."
marc.lifsher@latimes.com
California unemployment hits 10.5% in February
After 116,000 jobs are lost for the month, the state's unemployment rate is the highest since April 1983.
By Marc Lifsher
March 21, 2009
Reporting from Sacramento -- California employers led the nation in mass layoffs in February as the state's unemployment rate hit 10.5%, the highest level since April 1983, state and federal labor agencies reported Friday.
The reductions cascaded across all areas of the Golden State's economy, hitting major corporations that included Circuit City Stores Inc., Yahoo Inc., JPMorgan Chase & Co. bank, Ralphs Grocery Co. and the Los Angeles law firm of Latham & Watkins, among others.
Big companies, which must file mandatory government reports every time they lay off at least 50 employees, gave pink slips to 45,557 Californians last month.
Nationally, mass layoff events reached a record high in February, affecting 295,477 jobs in all industries tracked by the Bureau of Labor Statistics.
The biggest portion, about a third, were in manufacturing, followed by retail trade and transportation and warehousing.
California jobless rate
California's losses were far higher than Illinois', with 19,469 jobs lost. Pennsylvania and Wisconsin were third and fourth.
But the mass layoffs were only a modest portion of the damage done to the Golden State's economy because the bulk of jobs are at small and medium-size businesses.
In all, California lost 116,000 jobs in February, bringing the 12-month total to 605,900.
Layoffs began 18 months ago in residential construction and moved to finance and wholesale and retail trade. Now, the state numbers show that cutbacks are hitting the once-secure bastions of healthcare, education and government services, sending new waves of unemployed workers to job-hunting centers.
"The job losses are intensifying and becoming more broad-based," said Esmael Adibi, an economist at Chapman University in Orange.
Construction, which continues to weaken, suffered the most in February, shedding 30,900 jobs. All other industries reported declines, with the exception of information, which includes television and movie production.
"Even the sectors that were considered recession-proof are losing steam," Adibi said.
California's jobless rate rose four-tenths of a percentage point in February, from 10.1% in January. A year earlier the rate was 6.2%. Unemployment in Los Angeles County increased by a slightly larger margin, to 10.9% in February from a revised 10.4% in January and 6.1% a year earlier.
Last month's national rate was 8.1%.
Both federal and California laws require employers to report large layoffs, though details of the mandates differ.
The tempo of layoffs is speeding up, state government officials warn.
"Since October, we've been getting these increasingly larger losses of jobs," said Howard Roth, chief economist for the California Department of Finance. He noted that February job losses were the heaviest in a single month since at least 1990.
What's more, the pace of disappearing jobs is hitting California disproportionately hard, compared with the other 49 states. California, which accounts for 11% of the national workforce, has suffered 18% of U.S. job losses.
California in recent years has been plagued by average job growth, a reversal from the superheated dot-com boom of the late 1990s, said Stephen Levy, director and senior economist at the Center for the Continuing Study of the California Economy in Palo Alto.
Levy attributes the state's high unemployment rate to a combination of sharp job losses and a workforce that's ballooned by 350,000 people.
Growth, he said, "obviously depends on the success of national policies to boost employment and stabilize the housing and banking sectors."
That's what California Gov. Arnold Schwarzenegger, who met with President Obama on Friday at the White House, is counting on.
"My administration is working tirelessly with the federal government to pump federal economic stimulus funding into our economy to create jobs as quickly as possible," Schwarzenegger said in a statement. But, he cautioned, "the road to economic recovery will not be short."
The good economic news, meager as it might seem, is the assurance of federal aid from the Obama stimulus package and the Federal Reserve's move this week to ease credit, said Sung Won Sohn, an economist and Asian trade expert at Cal State Channel Islands.
"The federal help will not turn the economy around," he said, "but it will prevent the economy from getting worse."
marc.lifsher@latimes.com
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