Blog on the Run: Reloaded

Monday, April 14, 2014 12:09 am

Is we is or is we ain’t a nation under the rule of law?

I think we ain’t, but it looks like we’ll know soon enough, because the leak even I could see coming is here:

A still-secret Senate Intelligence Committee report calls into question the legal foundation of the CIA’s use of waterboarding and other harsh interrogation techniques on suspected terrorists, a finding that challenges the key defense on which the agency and the Bush administration relied in arguing that the methods didn’t constitute torture.

The report also found that the spy agency failed to keep an accurate account of the number of individuals it held, and that it issued erroneous claims about how many it detained and subjected to the controversial interrogation methods. The CIA has said that about 30 detainees underwent the so-called enhanced interrogation techniques.

The CIA’s claim “is BS,” said a former U.S. official familiar with evidence underpinning the report, who asked not to be identified because the matter is still classified. “They are trying to minimize the damage. They are trying to say it was a very targeted program, but that’s not the case.”

The findings are among the report’s 20 main conclusions. Taken together, they paint a picture of an intelligence agency that seemed intent on evading or misleading nearly all of its oversight mechanisms throughout the program, which was launched under the Bush administration after the Sept. 11, 2001, attacks and ran until 2006.

Some of the report’s other conclusions, which were obtained by McClatchy, include:

_ The CIA used interrogation methods that weren’t approved by the Justice Department or CIA headquarters.

_ The agency impeded effective White House oversight and decision-making regarding the program.

_ The CIA actively evaded or impeded congressional oversight of the program.

_ The agency hindered oversight of the program by its own Inspector General’s Office.

So, in plain English:

  • The CIA tortured people — some of whom died of it, remember — in violation not only of international and U.S. law but also in violation of the flimsy, themselves-illegal guidelines set up by the Justice Department.
  • The CIA lied to the White House and Congress, obstructing their oversight, which is duly required by Constitution and statute.
  • The CIA lied to its own inspector general.

So CIA personnel ordered and committed hanging offenses and lied to everybody about it. That’s the bottom line, folks. All the rest is sound and fury signifying nothing.

Let’s be very clear about what needs to happen here:

  • The people who actually carried out the crimes must be charged and tried, but so must the people who ordered them and the people who lied about them.
  • If anyone carried out or ordered torture that resulted in death, that individual is subject to the death penalty. As a tough-on-crime conservative, I can sleep soundly knowing that.
  • If anyone used the classification process to try to hide evidence of a crime, he should be criminally prosecuted for that offense.
  • If anyone then or now in a Senate-confirmable position carried out or ordered a crime, he should be impeached and convicted, thereby to revoke his pension and any other benefits of having served in the federal government.

If these things do not happen, then we are not a nation under the rule of law, plain and simple. I wish I could say that we are, but experience suggests that nothing will happen.

So let’s do ourselves a favor. Let’s put paid, once and for all, to this notion of American exceptionalism. We are not special. We are not a shining city on a hill. We are not a Christian nation in any way that Christ Himself would recognize. We are not even, to judge by both legal standards and OECD measures for quality of life, a particularly good example.

It is tempting to say that we are governed by a parliament of whores, but to do so would insult whores, who generally are not nearly as hypocritical about what they do as our leaders are. We are a plutocracy, an oligarchy, an outlaw nation, and the only differences between our genocide and that of the Nazis is that ours was less recent and less efficient. Indeed, it was ironic for me to read tonight on Facebook about my friend Rabbi Fred Guttman honoring the congressional service of my friend Howard Coble, when Coble, a former federal prosecutor, did nothing to stop precisely the kind of behavior on the part of Americans that got Nazis hanged at Nuremberg.

I’d love to be proved wrong on this. I really, really would. But if it hasn’t happened by now, it ain’t gonna. And Americans need to understand that and to plan their futures accordingly.

Monday, April 7, 2014 6:59 pm

Do peons dream of loyalty?

I spent my 16th, 17th, and 18th summers working in food service at the Carowinds amusement park on the N.C./S.C. line near Charlotte. It was hard, hot, sticky, messy, occasionally dangerous work — hot frying fat is nothing to mess with, which doesn’t keep teens from messing with it, and I once got knocked back 10 feet into a stream cabinet when I accidentally touched a bare wire on a 440-volt grill I was trying to unplug. (Had I not been wearing rubber-soled shoes, an electrician told me, I might’ve been killed.) When I finished my first full day of work — 9 hours in a steamy kitchen on a humid April Saturday — I was in outstanding physical shape and still as physically tired as I would ever be in my life until I got E. coli food poisoning two decades later.

We had all kinds of rules about customer relations, grooming (sideburns no lower than the earlobe), our itchy-ass polyester uniforms, not sitting while on duty, and so on.

So when I read this post on working in retail by ex-journalist Joseph Williams, I didn’t find a whole lot that was new to me, other than the vastly increased amount of theft-prevention activity. But a lot of it was new to him, or forgotten since his last stint in retail 30  or so years ago. And there’s a small part of me that wants to criticize his ignorance, because retail and restaurant work is one of the fastest-growing segments of the labor force in an economy that is not, generally, creating enough new jobs even to match growth in the working-age population, let alone bring down the un- and under-employment rates. If journalists know nothing else about the economy, they need to know that, and what the ramifications are for the growing numbers of Americans for whom this is real life.

Obtaining work in retail had changed a lot since the 1980s. What used to require a paper application and a schmooze with the manager has turned into an antiseptic online process where human interaction—and the potential for an employment-discrimination complaint—is kept to a minimum.

That put me at a distinct disadvantage.

In person, thanks to good genes, people often assume I’m younger than I am. On paper, however, I’m just another overeducated, middle-aged, middle-class refugee whose last retail experience dates to the Reagan administration.

Not to mention retail employers these days have their pick of applicants: the Great Recession added countless numbers of desperate workers like me to the annual labor-market influx of college students and high schoolers. According to an Economic Policy Institute report, “In 1968, 48 percent of low-wage workers had a high school degree, compared to 79 percent in 2012.” Likewise, the percentage of people in these jobs who have spent some time in college has skyrocketed, jumping from under 17 percent to more than 45 percent in the same time. All of us are in a race to the bottom of the wage pool.

Although older job candidates bring experience and skills to the table, their job applications typically blink like red warning lights to retail managers: overqualified, overpaid, and probably harder to manage than some high school or college kid. In a word: trouble.

“Think about it, Joey—that’s why there are online applications,” my sister, a veteran human-resources professional, told me. “If you apply online, and you never hear back, they don’t have to tell you why they rejected you and face a discrimination lawsuit.”

I soon realized the only way I’d have a shot in retail is if I dumbed down my job application, met directly with the person in charge before applying, and used my journalism story-telling skills to sell myself, stretching the truth past the breaking point.

He also discusses how “wage theft” — essentially, employers ripping free labor from employees, works, and this, too, I remember from Carowinds:

Working in retail takes more skill than just selling stuff. Besides the mindless tasks one expects—folding, stacking, sorting, fetching things for customers—I frequently had to tackle a series of housekeeping chores that Stretch never mentioned in our welcome-aboard chat. Performed during the late shift, those chores usually meant I’d have to stay well past the scheduled 9 p.m. quitting time.

Mop the floors in the bathroom, replace the toilet paper and scrub the toilets if necessary. Vacuum. Empty the garbage. Wipe down the glass front doors, every night, even if they don’t really need it. It was all part of the job, done after your shift has ended but without overtime pay.

In at least one respect, I had it better than this guy: Once in a while, I actually did get overtime pay. Not always. Not often. But once in a while.

This guy was paid $10 an hour in a state where the minimum wage is $7.25. He has an interesting take on whether the minimum wage should be raised, and once again, it involves wage theft (highlighted text below):

Proponents [of a minimum-wage increase] argue that three extra dollars an hour can lift hundreds of thousands of workers out of poverty. Opponents say a raise for hourly-wage workers would keep some businesses from hiring and force others to make layoffs to stay in the black.

As a worker who earned $10 an hour, I say: Neither argument is entirely true.

Sporting Goods Inc., I came to realize, was fine with paying me a few dollars more than the minimum wage—officially $7.25 an hour in Maryland—because it had other ways to compensate itself, including disqualifying me from overtime or paid sick days. Requiring me to play Cinderella on the closing shift also saved management the money it would have had to pay a cleaning company to maintain the store. Yet even $10 an hour—about $400 a week before taxes—can barely keep a single adult afloat in a city like Washington.

A modest studio apartment in a safe neighborhood would easily consume an entire month’s pay. Meanwhile, depending on circumstance, an annual salary of roughly $20,000 might not automatically qualify a retail worker for government assistance. One of my co-workers, a young single mother I called Flygirl, lived with her mom and commuted 40 minutes, one-way, from a far-flung suburb to make ends meet. Most of my co-workers, in their early 20s or 30s, had roommates, spouses, or second jobs. None of them seemed to be making it on their retail salaries alone.

Even though I was living rent-free in a guest bedroom, my every-other-Thursday paycheck couldn’t help me climb out of my hole, particularly after the state took half my pre-tax, $300 weekly salary for child support payments. Grateful just to have a job, I didn’t think twice when I noticed Stretch sometimes cut me from the daily crew and kept my hours under 30 per week—until Mike, a longtime friend and a former union shop steward, explained.

“You’re part-time,” he told me. “If you work 40 hours or more, they’ll have to give you benefits.”

Because I live across town, meanwhile, I had an hour-long commute that cost as much as $10 a day round-trip on public transportation.

“Dude,” my best friend Jamie said. “After taxes, you’re making just enough to get to and from work each day.”

And when the writer finally finds a new job, one that pays a living wage, he tells his boss, who promptly criticizes his work ethic and  loyalty.

We seldom get to pick either the messages we receive or the messengers from whom we receive them. And it would have been nice if this guy hadn’t landed in poverty through his own doing, at least in part. But his story matters no matter his personal failings, because his story is pretty much the story of everybody who works in retail.

As was discussed in the Ideas section of Sunday’s News & Record, North Carolina still has about three unemployed people for every available job opening, and that doesn’t even count the so-called “discouraged” workers who have stopped looking for work and therefore are not counted as unemployed. Nor does it count the people who, though qualified for better jobs, are working part-time or minimum-wage jobs because that’s all they can find.

Their experiences are not hugely different from this guy’s. If you’re not one of them, you probably know many people who are. The American economy is screwing them to the wall, and it’s happening because of conscious and intentional decisions made by lawmakers in thrall to large corporations. It’s 21st-century peonage. And it needs to stop.

There is dignity and morality in honest work, even in retail, as long as workers are paid and treated fairly. But there is no dignity for the worker, and no morality for the employer, in taking from the worker what is rightfully his and debasing and degrading him while doing so.

 

Thursday, April 3, 2014 6:30 pm

Life and death, post-9/11, and why it matters if you live in North Carolina

In March, for the first time in 11 years, no U.S. service members died in either Iraq or Afghanistan.

That’s good. Hell, that’s GREAT.

But it doesn’t mean our problems are over:

On average, 22 veterans commit suicide each day, according to the Iraq and Afghanistan Veterans of America (IAVA).

To commemorate them and raise awareness, 32 veterans from the group flew to Washington, D.C., to plant 1,892 flags on the National Mall today, one for each of the veterans that the group says took his or her own life in 2014. IAVA extrapolated that number from a 2012 Veterans Administration report finding that 22 veterans took their lives each day in 2009 and 2010, only a slight increase from years past, and a number that includes all veterans, not just those who served in America’s more recent wars in Iraq and Afghanistan.

The event was part of IAVA’s 2014 Storm the Hill campaign, an annual week of action in which organization vets meet with lawmakers to push a veterans’ agenda picked for that year. In 2013, it was the Veterans Affairs benefits-claim backlog; this year, it’s veteran suicides.

“I know several individuals that have died by suicide,” Sara Poquette of Dallas, a video journalist who served in Iraq, said, adding that she herself considered suicide while experiencing the hardships of reintegrating into civilian life. “For me personally, it was more just getting through until I was really ready to get help, just realizing that my life was going down a path that I never really wanted it to go down.”

In Joining IAVA, Poquette said, she found a “new unit.”

The Iraq and Afghanistan Veterans of America is pushing a bill, the Suicide Prevention for America’s Veterans Act, which Sen. John Walsh, D-Mont., plans to introduce. Walsh commanded a Montana National Guard battalion in Iraq.

“When we returned home, one of my young sergeants died by suicide, so this is very personal to me,” Walsh told reporters on the Mall today, calling veteran suicides “an epidemic we cannot allow to continue.”

The bill would extend eligibility for Veterans Administration health care, create a pilot program for student-loan repayment if health care professionals work for the VA, instigate a review of certain behavioral discharges, and mandate a review of mental health care programs at the VA, IAVA said.

The group is calling on Congress to pass the bill by Memorial Day.

OK, so the numbers are extrapolations, not exact counts. But even if they’re off a good bit, they’re still intolerably high. God bless Sen. John Walsh for planning to introduce this bill.

But you know who else could do something about veterans’ suicides and other problems, particularly with disability payments, that veterans are experiencing and have been for years?

That would be the ranking minority member of the Senate Veterans Affairs Committee.

That would be the guy from Winston-Salem, home of the VA regional office with one of the nation’s worst backlog of disability claims cases and a record of illegally destroying claim files.

That would be my senior senator, Richard Burr.

How ’bout it, Senator? Time to saddle up, ya think?

Friday, March 28, 2014 8:57 pm

If only there were a solution; or, Why Pat McCrory and Art Pope need to be horsewhipped

From today’s News & Record print and e-edition (but apparently not from the website, so probably paywalled):

Gov. Pat McCrory on Thursday asked for more belt-tightening within state government as a pre-emptive move to protect the state from a Medicaid shortfall and a fuzzy revenue picture.

In a memorandum to state agencies and their leaders, McCrory said that while the state’s fiscal picture is much improved compared with “a year ago, “the state still needs to exercise restraint for the remainder of the fiscal year,” ending June 30. He wrote a similar directive in March 2013.

McCrory’s state budget office projected this week that Medicaid expenditures could be up to $140 million above the amount the General Assembly authorized.

First of all, “McCrory’s state budget office” is budget director Art Pope, the real governor. McCrory’s just the cabin boy.

Second, so the state might need to spend $140 million above what’s been authorized. Gee. Whocouldaknowed? And if only there some way the state could do something about that without eliminating raises for hard-working state employees, who have seen damn little in the way of raises since the Crash of ’08. There ought to be something we could do, y’know. Hmm. What could it be? And why didn’t the AP and/or the News & Record point that out?

But we continue:

While revenue projections are largely on track to cover this year’s budget, “there is revenue uncertainty for the remainder” of the year, McCrory wrote.

Stop right there, bubba. Both of those things cannot be true simultaneously. McCrory, by whom I mean Pope, is just flat-out lying here and hoping no one will notice. Certainly the AP and the News & Record didn’t.

He also ordered his Cabinet-level agencies to discontinue most salary increases, limit purchases, reduce travel expenditures and reconsider contract work.

Translation: Basically, we’re not just going to screw up Medicaid, we’re going to screw up every other agency, too.

Jesus wept. What they’re doing (and refusing to do that could help) is bad enough. And the news media are giving them a free pass on top of that.

Dear Merciful God, I’ve had a pretty good life, all in all, and so I haven’t asked you for much. And much of what I have asked for, you’ve delivered. But even though you did my family and me quite a solid just today, I’m asking this: Please let Roy Cooper, or some other competent Democrat, run against McCrory in 2016 and whip him like a rented mule. I mean, whip him so badly he needs skin grafts to close all the bloody welts on his ass.

Now, Lord, I grant that’s pretty harsh. But your own son took a brutal flogging en route to saving humankind. Meanwhile, thousands of North Carolinians are doing without health insurance, and thus health care, who wouldn’t have to except that Pat McCrory and Art Pople hate the non-white guy in the White House. And a nontrivial number of those North Carolinians, research shows, are likely to die prematurely because McCrory and Pope are petty, racist sociopaths. So I figured that taking a beating like that wouldn’t fix the damage McCrory will do between now and January 2017. But it might make a lot of suffering people feel a little better and prevent a boatload more suffering in the future.

So if it wouldn’t be too much trouble …

Amen.

Thursday, March 27, 2014 8:53 pm

Thought for the day, rugged-individualism edition …

… from Helaine Olen at Reuters:

To presume home-buyers put into predatory loans by mortgage brokers working for outfits like Countrywide Financial could have stopped the housing market implosion if they knew a bit more about balancing their checkbook is absurd. Just as absurd as thinking a high school class in money management could help someone two decades later decipher a 100-page, single-spaced mortgage origination document loaded with “gotcha” clauses.

But our self-help culture doesn’t allow us to admit we might not be able to overcome greater economic woes on our own. In fact, it often makes our individual situations worse when things don’t work out.

Thomas Scheff, a professor emeritus at the University of California, Santa Barbara, recently published a paper in the journalCultural Sociology claiming that in highly individualistic cultures like the United States, where people are encouraged to “go it alone,” shame is the price we pay for not achieving success.

Viewed through this prism, you can think of the constant simmering anger in our culture as the road rage of self-help culture. Fearing the humiliation of failure, we aggressively lash out at others who prove the self-help nostrums a lie.

This could be the reason that many, including Republican members of Congress, blame the long-term jobless for their own plight, and cut off their unemployment checks. We say those who fell prey to predatory lending weren’t misled, but were greedy.

According to the tenets of self-help, the victims of the American economic collapse need not a helping hand, but a kick in the pants.

True, self-help advice is not always fully useless. Saving money, for starters, is certainly more likely to lead to a prosperous life than not putting anything aside at all. Yet all too often, knowledge and individual action are not enough.

Self-help causes us to take the political and economic problem of increasing income inequality and make it personal. That’s both morally wrong and financially ineffective.

That we fall for it only makes it worse.

I would add that the fact that we fall for it is no surprise when you watch how much and how deeply American media of all political stripes (or none at all — movies produced purely for entertainment, for example, often include this theme) drill this message home. As we are bombarded by and marinated in those messages, the notion that many if not most great things we’ve accomplished could only have been accomplished by teams, groups, companies, communities, or the states or the federal government becomes the dog that didn’t bark: We’re so used to, and have so absorbed, this self-reliance tenet that we fail to note its all-too-frequent systemic failures.

We’re all in this together, folks. And before we can act like it, we — or most of us, anyway — have to think like it.

(h/t: Fec)

Wednesday, March 12, 2014 8:27 pm

Was EVERYBODY to blame for the 2008 crash? Not just no, but, hell, no.

Dean Starkman at The New Republic, writing long and worth every word and minute:

With Wall Street’s demand for mortgages unending and some loan producers managing to book up to 70 loans per day, the system didn’t just crash. It was brought down.

But we’ve also been made to understand that subprime lenders and their Wall Street funders didn’t act alone. Instead, they were aided by the avarice of the American people, who were not victims of the crash so much as accomplices in it. Respondents to aRasmussen poll done during the throes of the crisis overwhelmingly blamed “individuals who borrowed more than they could afford” (54 percent) over Wall Street (25 percent). To this day, the view is widespread and bipartisan: Main Street was an essential cause of the meltdown. The enemy was us.

“It all goes back to the increase in the tolerance for debt,” David Brooks wrote a couple of years ago. …

One of so many instances in which Brooks has been flat wrong on the facts without professional consequence. But I digress.

Is that not the truth?

Actually: No, it’s not. The notion that American consumers share the blame for the mortgage crisis is a lie. And it is one of the most pernicious out there.

Everyone-Is-To-Blame (or EITB, for brevity’s sake) has done much to mute the public outcry essential for sweeping efforts to respond to the financial catastrophe. To the extent that Dodd-Frank fell short of the root-and-branch reform that followed the last great crash in 1929, EITB is to blame. The fact that banks too big to fail before the crisis have been allowed to grow to twice their pre-bubble sizes can be traced to a nagging sense that they didn’t act alone. And if you wonder why, six years after the fact, no significant Wall Street figure has been criminally prosecuted, I would suggest that EITB has muddied perceptions just enough to allow the administration to sidestep the necessary legal mobilization. If everyone is to blame, then criminal indictments of individual executives can be framed as exercises in scapegoating.

Everyone-is-to-blame did its worst damage to the Home Affordable Modification Program, or HAMP, an effort rolled out in the immediate aftermath of the crisis to reduce borrowers’ monthly payments through refinancing or principal write-downs. It was the mere idea of HAMP that set off Rick Santelli on his 2009 rant about “losers’ mortgages” and their “extra bathroom,” sparking the Tea Party revolt. The prospect of helping delinquent borrowers, while others paid theirs on time, unleashed a flood ofressentiment that filled the Congressional Record with denunciations of “irresponsible” actors who “lied” only to wind up in line for “gift equity,” and “tax-payer subsidized windfall.” Wisconsin Representative Jim Sensenbrenner introduced the concept of “happy-go-lucky borrowers” and “cagey borrowers.” Jim Bunning, then Kentucky’s junior senator, felt compelled to warn against helping homeowners “who made bad decisions.” The outpouring tapped into a sentiment powerful enough to silence even some liberals and turned hamp into a political disaster for the Obama administration. Left adrift, the program went from a potential lifeline for borrowers to a fee-machine for servicers and a Kafkaesque nightmare for those it was supposed to help.

As an agent of obfuscation, EITB is a gift that keeps on giving. In October, The Washington Post’s editorial board objected to a $13 billion mortgage-era civil settlement with J.P. Morgan largely because it unfairly singled out the bank, when, in fact, “everyone, from Wall Street to Main Street to Washington, acted on widely held economic beliefs that turned out not to be true.” A forthcoming book by Bob Ivry, a Polk Award–winning investigative reporter for Bloomberg News (and, full disclosure, a friend), eloquently inveighs against big banks and their Washington lackeys, but also includes this assertion: “In the years leading up to the Great Bubble-Burst of 2008, everybody got a chance to cash in. … If you wanted to buy a place to live, you could get more house than you ever dreamed. You could use your rising home equity for the Disney vacation, the power boat, the fourth bedroom or the college education.” …

True. But that’s not the same thing as mortgage fraud, which, though not trivial, was an incredibly small part of the total problem:

In 2010, an FBI report drawing on figures from the consultancy Corelogic put total fraudulent mortgages during the peak boom year of 2006 at more than $25 billion. Twenty-five billion dollars is obviously not nothing. But here again, teasing those mortgages out of that year’s crisis-related write-downs of $2.7 trillion from U.S.-originated assets leaves our infamous “cagey” borrowers to blame for only a tiny share of the damage, especially since not all of the fraudulent mortgages were their fault. The ratio looks roughly something like this:

Yes, some of our cab drivers, shoeshine boys, and other fellow citizens tricked a lender into helping them take a flyer on the housing market. But the combined share of the blame for bad mortgages that can be placed on the public sits—and I’m really rounding up here—in the high single digits, and not the much larger, fuzzier numbers in our heads.

The fact is that defrauding a bank that actually cares about the quality of a loan is actually rather difficult, no matter how aggressive or deceitful the borrower. Lenders, on the other hand, can lie with relative ease about all sorts of things, and mountains of evidence show they did so on a widespread basis. For starters, it’s lenders who establish the loan-to-value ratio for a property: how much money the buyer is borrowing versus the house’s estimated worth. Banks didn’t used to let you take out a mortgage too close to the home’s total cost. But play with those numbers and, voilà, a rejected loan application turns into an accepted one. Leading up to the crash, some banks’ representations about loan-to-value ratios were off by as much as 40 percentage points.

Then there was the apparent rampant corruption of appraisals, which also have nothing whatsoever to do with borrowers. Before the bubble popped, appraisers’ groups collected 11,000 signatures on a petition decrying pressure by banks to arrive at “dishonest” or inflated valuations.

And that’s to say nothing of lenders misleading borrowers directly—a practice that the Financial Crisis Inquiry Commission, the Levin-Coburn report, and lawsuits by attorneys general around the country have all found was very much systemic. Mortgage brokers forged borrowers’ signatures and altered documents; Ameriquest (those guys again!) had its own “art department,” as it was known internally, for precisely that function. Oh, and remember those 137,000 instances of “suspicious activity” about possible borrower misdeeds? For the sake of perspective, Citigroup settled a Federal Trade Commission case alleging sales deception that involved two million clients in a single year. That’s what we call wholesale, and it was happening before the mortgage era even really got started.

Today, there’s a big and growing body of documentation about what happened as the financial system became incentivized to sell as many loans as possible on the most burdensome possible terms: Millions—and millions—of borrowers were sold subprime despite qualifying for better.

Perhaps the most astonishing and unappreciated finding comes from The Wall Street Journal, which back in December 2007 published a study of more than $2.5 trillion in subprime loans dating to 2000 (that is to say, most of the subprime loans of the era). The story, by my former colleagues Rick Brooks* and Ruth Simon, painted the picture of a world gone upside-down: During the worst years of the frenzy, more than half the subprime loans issued went to borrowers who had credit scores “high enough to often qualify for conventional loans with far better terms.” In 2006, the figure hit 61 percent. Along with its article, the Journal illustrated the alarming trend line with a version of the following graphic:

It goes without saying that no one would voluntarily eschew a prime loan for subprime—subprime is called that for a reason, carrying higher, often escalating rates; pre-payment penalties that “shut the backdoor” by precluding refinancing; and other burdens tacked on for good measure. The Journal concluded that its analysis “raises pointed questions about the practices of major mortgage lenders.” That’s putting it mildly!

He goes on to suggest some reasons why Everybody Is To Blame is such a popular world view. But what he keeps coming back to, what we must keep coming back to, is that it is wrong. If you actually look at the numbers — you know, like bankers are supposed to do — you consistently find that the overwhelming majority of the financial damage was caused by the banks, often through unethical and sometimes even illegal means.

Even so, today, we refuse to punish those responsible. If there’s Blame to be laid at the feet of Everybody, this is it. Charlie Pierce is fond of saying that for all Occupy Wall Street’s many foibles, gaffes and mistakes, it at least got people shouting at the right buildings — i.e., corporations rather than government, and the big banks in particular. Unfortunately, some of the country’s top journalists and pundits still get it wrong, and they and the lawmakers on the take form a daisy chain that keeps anything substantive from happening, not only to punish those who were responsible last time but also to do what it takes keep something like this from happening again.

It’s not Everybody’s fault. Everybody is NOT to Blame. The banks and their executives and boards are to blame. And part of citizenship in a constitutional republic is to hold them to account.

*Disclosure: Rick Brooks worked with me at the N&R in the early 1990s.

Thursday, March 6, 2014 7:57 pm

The effort to help the poor that even the GOP could love, once, is now in their sights

Tim Noah:

President Obama’s new budget increases spending on and expands eligibility for the Earned Income Tax Credit, the largest and most successful government assistance program for the working poor.

The much-praised House GOP tax reform introduced last week would cut the EITC, even though a House GOP report excoriating most federal assistance to the poor singled out the program for applause.

This new partisan difference over the EITC – a program that in the past has been a rare source of bipartisan agreement – speaks volumes about Republicans’ newfound ambivalence toward the working poor.

The EITC was created back in 1975 by Sen. Russell Long, who–despite being the son of populist Louisiana Gov. Huey “Every Man A King” Long – was fairly conservative. The idea was to use government assistance to reward work rather than indolence among the poor; you only got the money if you could show that you had worked.

This conceit had obvious appeal to President Ronald Reagan, who expanded the program, and later to President Bill Clinton, who expanded it much further even as he eliminated “welfare as we know it,” i.e., long-term, no-strings cash assistance to the poor. (The EITC was further expanded under Presidents George W. Bush and Barack Obama.)

Welfare reform should have ended the partisan scrimmage over welfare dependency. Instead, it merely shifted the goalposts. Previously, the GOP had praised the “deserving” (i.e., working) poor even as it derided the “dependent” (i.e., welfare-collecting) poor. But with Clinton’s abolition of long-term assistance and imposition of work requirements, it became more difficult to isolate a class of nonworking, government-dependent poor that Republicans could reliably scapegoat. So they gradually came to rebrand as “dependent” any low-income person who collected government assistance, even if that person also had a job. In effect, conservatives broadened their definition of “welfare” to the breaking point, including food stamps (most of which go to people with jobs), Medicaid (a benefit you collect only if you get sick), and even Pell Grants.

I don’t think the Republicans are “ambivalent” toward the working poor. I think they actively want to kick them harder. They may say otherwise, but by their works ye may know them. North Carolina already has killed its own version of the EITC because our legislature is controlled by sociopaths.

UPDATE, 9:37 p.m.: Forgot the link. It’s there now.

Monday, January 27, 2014 10:19 pm

The price of experience

Today is observed internationally as Holocaust Remembrance Day (it’s the anniversary of the day Soviet troops liberated the Auschwitz death camp in 1945). Earlier this evening, I attended a screening of the movie “Jakob the Liar,” about the lives of Jews in Poland’s Lodz ghetto in 1944, followed by recitations of the Male HaRachamim and the Kaddish.

The event also included a reading of a meditation, “The Price of Experience,” written by Adrian Mitchell and Kate Westbrook. Two lines in particular struck me:

It is an easy thing to talk of patience to the afflicted/To speak the laws of prudence to the homeless wanderer

It must be, because we do so much of it in America today. We have one major party (and, frankly, some members of the other) actively working against universal access to  health care. We accuse the poor of deserving to be poor because of moral flaws or failure to exert sufficient effort to pull themselves up by their own bootstraps, never mind the fact that increasing numbers of Americans have no boots and no immediate prospects of being able to find a job that pays well enough to buy them.

What is going on in America today is by no means, of course, morally equivalent to the Holocaust, and I do not mean to imply otherwise. But it is bad nonetheless: For more than 30 years the wealthy have waged war on the middle class, and that war has only accelerated with and since the Crash of ’08. Meanwhile, the hyperwealthy who attend Davos moan about the bad things the less fortunate say about them. One moron, venture capitalist Tom Perkins, writing in The Wall Street Journal — and you can’t make this crap up — even compared complaints about the wealthy to attitudes of Nazi Germany toward Jews. On a slightly less offensive level, neither Congress nor the Beltway media talk much about this problem, let alone consult with some of the people who know how to fix it. One can only assume that things are this way because the wealthy and powerful want them this way. That’s bad enough. But the victim blaming is a sign of advanced moral rot. And when moral rot in a society’s leadership expands to this point, perhaps a Holocaust is not inevitable. But a French Revolution certainly isn’t out of the question — nor should it be.   

Thursday, January 23, 2014 8:57 pm

Terrorist acts that our federal and state governments have ignored

Esquire’s Charlie Pierce with a thought experiment:

Imagine if there were three terrorist events in two weeks. First, terrorists poison a state’s water supply. Then, they rig a building to collapse and rig another one hundreds of miles away to explode. Nervous politicians would be blue-pencilling the Bill of Rights by daybreak. The NSA would throw a parade for itself. Edward Snowden would be hung in effigy, if we couldn’t do it in person. Somebody’s ass would get droned in Waziristan.

Sounds about right.

But in the past two weeks, we have seen West Virginia’s water supply be poisoned by a Koch Bros.-owned chemical plant (CORRECTION: As Roch notes below, the Kochs sold the plant Dec. 31, nine days before the leak), which promptly filed for bankruptcy protection so that the families who are harmed will have to be compensated by the state if they get compensated at all. Then we have the building collapse in Nebraska and the explosion in Oklahoma. And those events happened in the wake of the fertilizer plant explosion in West, Texas, that killed 15 people, injured more than 160 others and damaged or destroyed more than 150 buildings. What do these things have in common? Freedom! The dead hand of government regulation has been removed, by fiat or via lack of enforcement, so that these companies could kill Americans without significantly harming their owners’ bottom lines.

At Cogitamus.com, the Low-Tech Cyclist says:

I keep on waiting for the Democratic Party to get a clue about this: to say after the latest such disaster, “This is why we regulate, [expletive] – this is why we need the regulations, and why we need enough Federal inspectors out in the field to make sure they’re followed.  Because otherwise, they’ll poison our food, dump chemicals in our rivers, steal your wages, and make you work in places that could blow up.”

But Dems at the state and federal levels seem almost as in thrall to industry as their GOP brethren and sistren, so we’re all screwed. Pierce concludes:

(Forklift operator) Kendrick Houston was brave enough to go back into the fire (in Omaha). Yet too many of our politicians, local and national, don’t have the simple stones to stand up to a corporate class that has come to represent nothing but death and pillage. But they will show up at the funerals, boy. They will do that, and they will talk about the indomitable spirit of American individualism, through which people will run back into the fire, and then they will go out onto the stump next fall and talk about how the dead hand of government regulation is stifling that same spirit, and that freedom demands more victims. The American Dream becomes the province of the dead, Moloch with stock options, and that is the country today, where things fall down and things blow up and almost nothing ever changes.

The Republicans got the Congress back in 1994 in part by using language to frame the terms of the debate and even to describe their opponents as outlined in the now-famous document “Language: A Key Mechanism of Control.” So is it excessive to, as Low-Tech Cyclist does, call our plutocrat class “terrorists”? I think not — if the poison-tipped jackboot fits, wear it — but even then, they do what they do because we allow our legislators to let them. This, among many, many other reasons, is why voting matters and why electing people to office who believe that government can and should do its job, not those who are bent on dismantling what remains of government, is so important.

Some of our most vicious terrorists are home-grown, and it’s time they did time. But in addition, and better, it’s time we prevented them from getting in the way of what’s needed to keep our food, water, drugs, cosmetics, workplaces, and so on, safe. Because the free market doesn’t give a rat’s ass if you live or die. If you doubt me, you can just go to West, Texas, or even just down to Hamlet and ask.

Monday, January 13, 2014 9:32 pm

Jon Stewart on Chris Christie

In case there’s anyone out there who hasn’t seen this yet (language NSFW, duh):

A $90 billion story about GM that I had not heard before

Filed under: Shooting the wounded — Lex @ 6:08 pm
Tags: , , , ,

From Ed at Gin & Tacos:

… did you know, despite this fact being absent both from Michael Moore’s ultra-liberal documentary and ten thousand mainstream media accounts of GM’s bankruptcy a few years ago, that the financial collapse of what was once the world’s largest corporation was precipitated by Roger Smith’s bright idea to replace all of the autoworkers with robots? True story. General Motors under Smith spent $90 billion on robotics and automation in nine years.

Think about that for a second. Ninety billion dollars. $90,000,000,000.00. Of course none of it worked, with factory robots breaking down constantly, painting one another, and welding car doors shut. It’s easy to say that the company got what it deserved and forget about it. But think for a second about the mindset of a group of people so committed to the concept of eliminating the workforce (and the UAW) that it would piss away ninety billion dollars trying to do it. Even if the Worker Bots worked flawlessly, how could that possibly make financial sense? How many decades and centuries of “savings” from lower wages to earn back those sunk costs? And how much money would the Robo-Factories demand in the future for maintenance, upgrades, and eventual replacement with newer and better technology? For $90 billion, GM simply could have purchased Toyota, Honda, Nissan, and most of its other foreign rivals – several times over. Of course, in that scenario they’d still have to pay people to make cars.

The fact is that General Motors didn’t go bankrupt, it committed financial suicide because its executive culture fostered a loathing for the UAW and the hourly workforce that was so extreme that it obliterated basic logic and business sense. The idea was not to replace the workers with Japanese robots (GM Robotics was acquired from Fujitsu) because it would save money; it was to replace the workers with robots because [expletive] the workers.

Phrased a little less colorfully, that mindset has put us where we are today, with the stock market, corporate profits and corporate cash on hand at all-time highs — not because of greatly increased sales, but mainly because of cost-cutting, primarily by laying people off.

Which raises a question I wish would become an integral part of the debate in any campaign for federal office: What is the purpose of the economy? Is it to make a very few individuals and large corporations fantastically wealthy? Or is it to create jobs in which people produce goods or services that other people want to buy? My bias on this question is pretty obvious, but I imagine a large majority of Americans share that bias. If so, then what role should government play and how should it go about playing that role? The GOP response for my adult lifetime has been lower taxes and fewer regulations, which not only has gotten us coming up on six lost years of economic activity but also is injuring, sickening and killing people while poisoning the planet, from Fukushima, Japan, to Charleston, West Virginia.

Wednesday, December 25, 2013 12:58 am

The Gospel According to Pierce; or, A Christmas Prayer, With Carrion

And Pierce wrote, saying:

But this is the argument in season over these holidays. That the poor must suffer in order to be redeemed. That hunger is a moral test to be endured. That only through pain can we hope. What doesn’t destroy you, etc. Santa Nietzsche is coming to town. The idea that we should — hell, that we must — act out of charity for each other through the institutions of self-government is lost in the din of a frontal system of moral thunderation aimed at everyone except the person who is out there thunderatin’ on behalf of personal-trainer Jesus, who wants us to work, work, work on that core. That was the way that government operated once before; the specific institutions that Scrooge mentions, and with which the Spirit eventually reproaches him in his own words – the prisons, the union workhouses, the treadmill, and the Poor Laws – were all government institutions based on the same basic philosophy that drives the debate over the food stamp program today.(We even seem to be going back to debtor’s prisons.) We have speeches on self-reliance given by government employees to people who increasingly have only themselves on whom to rely, day after grinding day. It is a way to keep the poor from having a voice in their own self-government. It is a way to keep the wrath of the boy at bay. There will be a reckoning, one way or another. But it can be staved off by platitudes, and by verses from Scripture wrenched from the obvious context of the Gospels. The sepulchers brighten whitely while the bones inside grow increasingly corrupt. This is what this Congress believes, as it goes home proud of itself and its members dress themselves to sing the midnight carols with no conscience sounding in counterpoint, and this is Christmas in America, and it is the year of our Lord, 2013.

Merry Christmas to all, and tonight, God bless us, every one. But forgive me, Lord, in advance, for hoping and praying that the year of our Lord 2014 brings plague and pestilence upon those who would force the suffering to suffer further, those who would insist upon morality tests for the poor that they themselves could not pass, those who would require that many of our fellow Americans be denied a voice with which to insist anything. Bring on the plagues for them, turn their fruit into locust husks, their wine and water into blood, and their foie gras to feces, and let their corrupt bones and those of their first born be cast out from the whitely brightened sepulchers to be feasted upon by jackals and vultures.

Except for those who repent and atone. Always except for those.

Amen. And Amen.

Tuesday, December 10, 2013 7:41 pm

Giving a [bleep] about kids: Dems vs. GOP edition

Mistermix at Balloon Juice:

My dad is a lifelong Democrat because his family felt that Roosevelt and the Democrats gave a [bleep] about their kids during the Depresssion. I’m a Democrat because it’s clear who gives a [bleep] about my kid, and none of them have an R after their name.

They don’t give a [bleep] that hating gays leads to teen suicide.

They don’t give a [bleep] if kids go hungry because food stamps were cut.

They don’t give a [bleep] if teenagers can’t get birth control.

And they certainly don’t give a [bleep] that a kid who has epilepsy, or Crohn’s, will be saddled with a life of worry over whether she’ll be able to buy insurance.

After all the noise over the website dies down, after the Republicans try to shut down the government three more times and vote to repeal another dozen times, this is what’s going to be left for thousands of American families: a man and a party that gave enough of a [bleep] about them to endure a five year temper tantrum from a party that clearly has a broken give-a-[bleep]er when it comes to children.

It’s fine to talk in principle about limited government. (It must be — I do it, although I often mean something by “limited” that is different from what the RWNJs mean.) But when the real-life results of your actions carry an actual and nontrivial body count, you either change your positions or you mark yourself as a sociopath.

Moreover, the real reason why the GOP has carried on a five-year temper tantrum about Obamacare is that they know that if it works — and it is working, even if the website still has bugs — people will embrace it like Social Security and Medicare and the party will be screwed politically for at least a generation.

 

Thursday, October 31, 2013 10:04 pm

You want scary? Here’s scary: Congressional Democrats trying to help poor people.

Why are millions of Americans about to have their food stamps (SNAP) cut tomorrow? Because Congressional Democrats are the worst, most inept defenders of America’s most vulnerable in the history of, well, forever:

WASHINGTON — A group of nine Democratic members of the House of Representatives held a press conference outside the Capitol on Tuesday to demand Congress avert an automatic food stamp cut scheduled to take effect on Friday.

“The average family of four will see a $36 cut in their monthly benefits, bringing the average per-person benefit from $1.50 a meal to $1.40 a meal,” Rep. Jan Schakowsky (D-Ill.) said. “Shame on this Congress for allowing this to happen.”

But the cut, which will reduce monthly benefits for all 47 million Americans enrolled in the Supplemental Nutrition Assistance Program by roughly 7 percent, is happening thanks mainly to Democratic votes that hastened the demise of a benefit increase from the 2009 stimulus bill. Each of the representatives at Tuesday’s presser voted with their party for a pair of 2010 spending bills that set the cuts in motion.

The first bill took money allocated for future food stamp use and used it instead to prevent states from laying off teachers. Democrats supported the bill grudgingly, lamenting that it would cause a food stamp cut in 2014. When it came time to support a second bill that raided future food stamp funds once again, pushing the cut to November 2013, they protested — at least at first.

“This is one of the more egregious cases of robbing Peter to pay Paul, and is a vote we do not take lightly,” more than 100 Democrats wrote in an August 2010 letter to then-House Speaker Nancy Pelosi (D-Calif.).

But then President Barack Obama smoothed things over in a meeting at the White House, because the bill in question was the Healthy, Hunger-Free Kids Act — a priority of the first lady’s. The measure provided free lunches and updated nutrition standards for schools.

“I am very pleased we were able to work together with the president and his team to address concerns regarding cuts to the food stamp program that are included in the child nutrition bill,” Rep. Barbara Lee (D-Calif.) said in a statement at the time. On Tuesday, Lee told HuffPost the president had pledged to support replacing the SNAP funds, a vow he fulfilled in subsequent budget blueprints that didn’t become law. Congress and the White House have been otherwise silent about the issue for the past three years.

Now, you may have heard that the GOP is seeking cuts — $40 billion over the next 10 years — in food stamps, while continuing to support the indefensible agricultural subsidies that, along with food stamps, are part and parcel of the same agriculture bill now under discussion. And you’re right; they are. But the cuts that are going into effect tomorrow are a separate issue and were aided and abetted by a nontrivial number of Democrats — and this was back in 2010, when Democrats still controlled the House. Democrats hope you won’t notice this.

Digby comments:

They are actually defending the fact that they were forced into choosing between vegetables and fruits for school lunches and food stamps for poor people. Our progressive representatives passively capitulated to the absurd notion that we could not do both. How many of these “deals” have Democrats made over the past few years?

Too damn many, is how many. On pretty much every issue of importance to the poor, the middle class, women, minorities, consumers — basically every constituency except rich white men and large corporations — Democrats have gotten rolled over and over and over again.

I sometimes get asked why, given how nutzo the party has gone in the past 20 years, I remain a Republican. My reasons are my own, but, swear to God, some days I feel like saying something stupid like, “Because at least they’re competent.”

Monday, October 28, 2013 7:33 pm

Why Healthcare.gov problems shouldn’t be a surprise

Clay Johnson of the Sunlight Foundation and co-founder of Blue State Digital, the firm that built and managed Obama’s online 2008 campaign, on the rollout:

Well, government doesn’t have a lot of people to choose from when they’re looking for contractors to build this stuff. And I think part of the problem is that the same people that are building drones are building websites. When government is building a website like this, they have to use a system called procurement, which is about 1,800 pages’ worth of regulation that all but ensures that the people who are building this stuff are the people with the best lawyers, not the people with the best programmers. And so, you know, you have this sort of fundamental lack of talent amongst the contractor ecosystem that’s building this stuff, that it’s bound to be bad work—that, combined with the fact that in 1996 Congress lobotomized itself by getting rid of its technology think tank, called the Technology Assessment Office. So when they’re writing bills, they don’t understand the technology that they’re requiring in their laws. This is what you get when you have a Congress that is basically brainless on technology, and government who can only pick from a few old, stodgy contractors. You’re bound to have this result. And, in fact, the standings group came out earlier this week and pointed out that over—for all procurements over $10 million, 94 percent of them fail.

We can thank the Republicans for getting rid of the Technology Assessment Office, inasmuch as they controlled both houses of Congress at the time and facts are just so darned inconvenient.

Meanwhile, adding to the site’s problems, a data center built and run by Verizon went down Sunday, halting enrollment in all 50 states. I eagerly await Darrell Issa’s subpoena of Verizon’s CEO, and/or Issa’s call for the CEO to be fired.

Wednesday, October 9, 2013 7:41 pm

Pension systems for public workers are only unsustainable if …

Filed under: I want my money back.,Shooting the wounded — Lex @ 7:41 pm
Tags: ,

… politicians and bankers steal from them.

The government, via insurance and regulations, has some leverage over the banks. It should use it to recover the money the banks stole and return it to retired public workers.

Oh, and a unicorn.

Tuesday, October 1, 2013 7:47 pm

Digby explains it all for you …

… in less than a paragraph:

Boehner’s caucus won’t do what he wants them to do! He can’t make a deal they don’t want him to make unless he’s willing to commit hara-kiri and pass a clean CR with Democratic votes. Does he think Obama will agree to defund Obamacare?

Now, by “commit hara-kiri,” Digby means that if Boehner agreed to pass a clean continuing resolution with Democratic votes, he’d be voted out as Speaker. And, frankly, with the full faith and credit of the United States on the line in just a little over two weeks, a guy who cared about serving the country would take that deal. But the weeping Cheeto wants to hold onto the speakership, even though he’s a bad Speaker of historic proportions, so he’s going to let the Crazy Caucus dictate the GOP’s position. And Obama won’t back off on the Affordable Care Act (nor should he, what with it having been approved by Congress, signed into law, pronounced constitutional by the Supreme Court and effectively ratified by voters nationwide in 2012 and all).

The Crazy Caucus is threatening to blow up the government. And it’s not just a tantrum, it’s something they’ve been planning since January. They need to be reminded of something:

The United States does not negotiate with terrorists.

James Fallows’s thought experiment on government shutdown

Fallows shows your liberal media at work:

2) Thought experiment. Let’s suppose it’s the fall of 2005. Suppose George W. Bush has been reelected, as he was in real life. Let’s suppose, also as in reality, the Senate remained in Republican hands. But then suppose that Nancy Pelosi and her Democrats had already won control of the House, rather than doing so two years later. So suppose that the lineup as of 2005 had been:

  • Reelected Republican president;
  • The president’s Republican party retaining control of the Senate; and
  • Democrats controlling only one chamber, the House.

Then suppose further that Pelosi’s newly empowered House Democrats announced that unless George W. Bush agreed to reverse the sweeping tax cuts that had been the signature legislative achievement of his first term, they would refuse to pass a budget so that the federal government could operate, and would threaten a default on U.S. sovereign debt. Alternatively, that unless Bush immediately withdrew from Iraq, federal government funding would cease and the debt ceiling would be frozen.

In this imagined world, I contend:

  • “respectable” opinion would be all over Pelosi and the Democrats for their “shrill,” “extreme” demands, especially given their lack of broad electoral mandate;
  • hand-wringing editorials would point out that if you want to change policy, there’s an established route to do so, which involves passing new bills and getting them signed into law, rather than issuing “otherwise we blow up the government” ultimatums;
  • no one would be saying that the “grownups in the room” had to resolve the crisis by giving away, say, half of the president’s tax cuts. (Even though, to my taste, that would have been a positive step.)

The circumstances are the mirror image now. A party that within the past year has:

  • lost the presidency by 5 million votes;
  • lost the Senate by a total of 10 million votes;
  • held onto control of the House through favorable districting, while losing the overall House vote by 1.7 million nationwide

… is nonetheless dictating terms to the rest of the government. This would have been called extreme and unreasonable under an imagined Nancy Pelosi House in 2005. It is extreme and unreasonable now.

Yup. But apparently IOKIYAR, because the Washington Post and other outlets of its out-of-touch ilk are suggesting that the “grownups in the room” have to compromise now. Uh, not just no, but hell, no. The Crazy Caucus must be forced back into its cage, and until it is (which likely won’t be until the 2022 elections) it should be held up to public shame and opprobrium at every possible opportunity by the “grownups in the room,” which ought to include, but does not and has not for years, the Washington Post.

Monday, August 12, 2013 6:16 pm

Quote of the day, newspaper-industry edition:

Charlie Pierce:

Nobody, I assure you, knows anything. They’re just bailing like hell, and people like [Washington Post buyer Jeff] Bezos and [Boston Globe buyer John] Henry are the newest, shiniest buckets.

In the case of the Post, I suppose it’s possible that Bezos will bring Amazon.com’s customer-service technical know-how to the business side in salutary ways. But the content side has problems you don’t have to be a technology entrepreneur to see: It’s too focused on the horse race at the expense of policy coverage, it’s too focused on inside-the-Beltway middle-school cat fights at the expense of the kind of policy reporting a national newspaper ought to strive to provide, and its op-ed page is, with a few honorable exceptions, staffed with hacks who are either flat wrong or else clinging to a world view that went out of style the day after the Berlin Wall fell. His best hope is to turn the Post into an online-first operation and then look for ways to phase out or kill the print edition, and even he seems in no hurry to do that.

As for Henry, it’s hard to see what he gets out of this besides (even more of) a megaphone for his Boston Red Sox. He’s paying 5% of what the New York Times paid for the Globe 20 years ago and no matter what he does, he’ll be lucky to sell at a profit in his remaining lifetime.

Monday, July 22, 2013 6:28 pm

Why Detroit can’t just get a bailout like the banks did

Filed under: Shooting the wounded — Lex @ 6:28 pm
Tags: , , ,

Athenae explains it all for you, but it apparently boils down to the fact that Detroit wasn’t too big to fail:

It’s not like you spent the past 15 years putting the entire national economy on red in Vegas.

It’s not like you bet against your own customers and then sold them out without telling them.

It’s not like you took your federal bailouts and then backed a greedy [expletive] in the next election whose campaign did nothing but bash the entire CONCEPT of federal government.

It’s not like you reacted to the slightest attempt to regulate your business like someone who just watched his puppy gunned down in the street, and then demanded the rest of the world treat your feelings like a national emergency.

If you were one of those guys, hey, no problem. The free money pile is that way. Here’s a wheelbarrow. May we push it for you? Wouldn’t want you to strain your back.

Now come vulturous [expletive]s Kevyn Orr and Rick Snyder to tell other people it’s time to get “real,” because apparently losing your house and a retirement income YOU WERE PROMISED and facing the possibility of living in your car as a reward for working your whole life for the public isn’t “real.”

Now come Kevyn Orr and Rick Snyder, scraping their beaks on the bones of the wounded, to explain how they have no choice but to take everything away from people who have nothing, because sometime in the past somebody had the stupid idea that we should take responsibility for the people who take responsibility for us.

Kevyn Orr, by the way, is getting paid $275,000 to tell people who made $35,000 a year their whole lives to get real.

They want to steal it all because they want to steal it all. It’s no more complicated than that. And they must be stopped.

 

Wednesday, July 17, 2013 6:52 pm

Why you don’t want insane Ayn Rand fanboys running your company, Sears Holdings edition

It’s well known that libertarians want government shrunk, and that many of them profess to have been influenced by the Objectivism, the “philosophy” of the awful novelist Ayn Rand, who preached that properly channeled selfishness created the greatest good for the greatest number. And such techniques are supposed to make businesses prosper, right? So after this insane Rand-spouting hedge-fund guy, Eddie Lampert, became CEO of Sears Holdings, broke the company into more than 30 units and told them to be selfish (i.e., turn on each other), guess what has happened?

In January, eight years after (Eddie) Lampert masterminded Kmart’s $12 billion buyout of Sears in 2005, the board appointed him chief executive officer of the 120-year-old retailer. The company had gone through four CEOs since the merger, yet former executives say Lampert has long been running the show. Since the takeover, Sears Holdings’ sales have dropped from $49.1 billion to $39.9 billion, and its stock has sunk 64 percent. Its cash recently fell to a 10-year low. Although it has plenty of assets to unload before bankruptcy looms, the odds of a turnaround grow longer every quarter. “The way it’s being managed, it doesn’t work,” says Mary Ross Gilbert, a managing director at investment bank Imperial Capital. “They’re going to continue to deteriorate.”

Plagued by the realities threatening many retail stores, Sears also faces a unique problem: Lampert. Many of its troubles can be traced to an organizational model the chairman implemented five years ago, an idea he has said will save the company. Lampert runs Sears like a hedge fund portfolio, with dozens of autonomous businesses competing for his attention and money. An outspoken advocate of free-market economics and fan of the novelist Ayn Rand, he created the model because he expected the invisible hand of the market to drive better results. If the company’s leaders were told to act selfishly, he argued, they would run their divisions in a rational manner, boosting overall performance.

Instead, the divisions turned against each other—and Sears and Kmart, the overarching brands, suffered. Interviews with more than 40 former executives, many of whom sat at the highest levels of the company, paint a picture of a business that’s ravaged by infighting as its divisions battle over fewer resources. (Many declined to go on the record for a variety of reasons, including fear of angering Lampert.) Shaunak Dave, a former executive who left in 2012 and is now at sports marketing agency Revolution, says the model created a “warring tribes” culture. “If you were in a different business unit, we were in two competing companies,” he says. “Cooperation and collaboration aren’t there.”

That’s just moronic. Either you’re a company, with all units competing toward a single goal, or you spin off the units you don’t need. You don’t make your people fight internal wars; you have them fighting for customers and you, the CEO, need to have their back with a sensible strategy and adequate supplies/training.  Sure, it’s fun to play sand tiger shark and have your babies eating one another in your womb, but it’s also a good way to become a “species of concern,” “vulnerable” or even endangered.

Monday, June 24, 2013 6:12 pm

“This is a uniquely bad time to buy a house.”

I’m not in the market, and if Mike Whitney’s reporting is accurate, you shouldn’t be, either:

… nearly 5 million homes are either seriously delinquent or in some stage of foreclosure. This unseen backlog of distressed homes makes up the so called “shadow inventory” which is still big enough to send prices plunging if even a small portion was released onto the market.   In other words, supply vastly exceeds demand in real terms. Now check this out from Zillow:

“13 million homeowners with a mortgage remain underwater. Moreover, the effective negative equity rate nationally —where the loan-to-value ratio is more than 80%, making it difficult for a homeowner to afford the down payment on another home — is 43.6% of homeowners with a mortgage.” (Zillow)

This might sound a bit confusing, but it’s crucial to understanding what’s really going on. While many people know that 13 million homeowners are underwater on their mortgages,  they probably don’t know that nearly half (43.6%) of the potential “move up” buyers (who represent the bulk of organic sales) don’t have enough equity in their homes to buy another house.  Think about that. Like we said,  housing sales depend almost entirely on two groups of buyers; firsttime homebuyers and move up buyers. Unfortunately, the number of potential move up buyers has been effectively cut in half.  It’s simply impossible for prices to keep rising with so many move up buyers on the ropes.

So, if “repeat” buyers cannot support current prices, then what about the other “demand cohort”,  that is, first-time home buyers?

It looks like demand is weak there, too. According to housing analyst Mark Hanson: “First-timer home volume hit a fresh 4-year lows last month and distressed sales 6-year lows”.

So, no help there either. First-time homebuyers are vanishing due to a number of factors, the biggest of which is the $1 trillion in student loans which is preventing debt-hobbled young people from filling the ranks of the first-time homebuyers. Given the onerous nature of these loans, which cannot be discharged through bankruptcy, many of these people will never own a home which, of course, means that demand will continue to weaken, sales will drop and prices will fall.

Now, despite these appalling numbers, he notes, foreclosures are down by a third from this time last year. Is it because the housing market is really any better? Nope. It’s because the fewer foreclosures the banks follow through on, the fewer losses they have to report, the more profitable they seem and the bigger the bonuses their executives can then claim. The technical term for this behavior is “securities fraud,” and it looks as if every major bank is involved to a greater or lesser degree.

But by all means, let’s reduce enforcement on banks and mortgage companies. Free markets! Murca, hail yeah! Who cares if millions of homeowners and would-be homeowners get hurt?

Tuesday, June 18, 2013 7:06 pm

I have one question about the so-called “gender gap”: Why isn’t it bigger?

Prominent, powerful Republicans in large numbers have made it clear they don’t think women have the right to control their own bodies. Doubt me? Well, check out this handy-dandy reference guide, ItsNotJustAkin.com. The drop-down* menu features dozens of GOP bigwigs, not all of them men, who have said things about women’s rights that were anywhere from butt-ignorant to sociopathic. It might be one of the more important timesucks you encounter between now and November 2014.

(h/t: My sister Jane)

*In the mobile version.

Friday, June 7, 2013 5:01 am

Matt Yglesias gets shrill. And real.

We’ve heard a lot of bullshit these past several years about Social Security, so as an antitoxin, here’s Matt Yglesias:

The Powers That Be hate Social Security and always will because it’s a program whose entire purpose is to pay people money not to work. That’s not a perverse consequence of Social Security. It’s not a contentious partisan claim about Social Security. It’s not a dubious interpretation of what Social Security is all about. That’s the point. It’s to give people money so they can retire with dignity. “Retire” being a fancy word for “not working.” You’re never ever going to persuade business leaders to stop agitating for cuts in a program that has this feature. Business leaders want people to work! At a minimum, if people are hoping to not work, business leaders are going to want people to save (i.e., loan funds to business leaders) in order to achieve that purpose. Taxing people who are working in order to pay money so that people can enjoy retired life in peace is the antithesis of everything business elites want out of public policy.

And guess what we haven’t done during this era of changing projections? We haven’t cut Social Security benefits. We haven’t raised the age at which people become eligible for Medicare. We’ve done things to reduce budget deficits, in other words, but we haven’t really acted to make it tougher for people to retire. But people don’t like to say they want to make it hard for people to retire so instead they talk about “the deficit,” and they’re not going to stop.

The Powers that Be have had their way for way too long. I think it’s time that the rest of America slapped them and told them to shut their whore mouths.

 

Wednesday, April 17, 2013 12:00 am

Stop the presses. Actually, just blow their servers up.

Filed under: Aiee! Teh stoopid! It burns!,Evil,Shooting the wounded — Lex @ 12:00 am

So Jim Vandehei and Mike Allen of Politico, whose whole brand is that they are, in Jay Rosen’s multi-layered construction, “savvy,” are shocked, shocked to find out that the parents of some of the kids killed at Newtown are trying to lobby in something approaching sophisticated fashion.

Memo to these disingenuous twerps: The offense here isn’t that some families with education, money and sophistication are lobbying for something they want. The crime is that they have to do it to even be heard and still don’t have a snowball’s chance in hell of getting what they want.

I could vent. Really, I could. But I’ve had not nearly enough sleep for way too many days now, so I’m gonna outsource my rage to Charlie Pierce, who never disappoints:

You know what, you two privileged, Drudge-whoring twerps? Fk you. The grief these people feel is unimaginable, and it is theirs to feel, and it is theirs to use in any way they see fit. And if that happens to discomfit some of the greasy sublets who return your phone calls every day, that’s too goddamn bad. They’re not subtle? You miserable pair of lightweights, you know what else isn’t subtle? Autopsy photos of first-graders missing half their faces because it’s so goddamn easy in this country for lunatics to arm themselves.

That about covers it, I think.

Friday, March 15, 2013 7:24 am

Short and sweet. I mean sucky.

Google is killing Google Reader, its RSS blog aggregator upon which I have relied for years. I am revising my Google stock-price projections for class accordingly. In the meantime, here’s the inevitable Hitler clip; as always, subtitles are NSFW.

Thursday, March 7, 2013 7:55 pm

March 7 study break, “NC Medicaid IS NOT BROKEN” edition

h/t: Fec

Disclosure: Jeff Shaw of the N.C. Justice Center is a classmate in my current grad program. Further disclosure: He is not a bullshitter.

Wednesday, November 14, 2012 7:12 pm

Also, if you don’t want to repeat after me, kids, repeat after economist Dean Baker: The deficit problem is not an entitlements problem.

Listen to the man before you go giving away your — and my — Social Security and Medicare:

The gang for gutting Social Security and Medicare (aka “The Campaign to Fix the Debt”) are running in high gear. During the long election campaign they gathered dollars, corporate CEOs and washed up politicians for a full-fledged push in the final months of the year. They are hoping that the hype around the budget standoff (aka “fiscal cliff”) can be used for a grand bargain that eviscerates the country’s two most important social programs, Social Security and Medicare.

They made a point of keeping this plan out of election year politics because they know it is a huge loser with the electorate. People across the political and ideological spectrums strongly support these programs and are opposed to cuts. Politicians who advocated cuts would have been likely losers on Election Day. But now that the voters are out of the way, the Wall Street gang and the CEOs see their opportunity.

It is especially important that they act now, because one of the pillars of their deficit horror story could be collapsing. Due to a sharp slowing in the rise of health care costs over the last four years, the assumption that exploding health care costs would lead to unfathomable deficits may no longer be plausible even to people in high level policy positions.

As we all know, the large budget deficits of the last four years are entirely due to the economic downturn caused by the collapse of the housing bubble. The budget deficit was slightly over 1.0 percent of GDP in 2007 and the Congressional Budget Office (CBO) projections showed it remaining low for the near-term future. The origin of the large deficits of the last few years is not a debatable point among serious people, even though talk of “trillion dollar deficits, with a ‘t’” is very good for scaring the children.

However, the big stick for the deficit hawks was their story of huge deficits in the longer term. They attributed these to the rising cost of “entitlements,” which are known to the rest of us as Social Security, Medicare, and Medicaid.

While they like to push the notion that the aging of the population threatened to impose an unbearable burden on future generations, the reality is that most of the horror story of huge deficits was driven by projections of exploding private sector health care costs. Since Medicare and Medicaid mostly pay for private sector health care, an explosion in private sector health care costs would eventually make these programs unaffordable.

As some of us have long pointedout, there are serious grounds for questioning the plausibility of projections that the health care sector would rise to 30 or 40 percent of GDP over the rest of the century. Recently a paper from the Federal Reserve Boarddocumented this argument in considerable detail.

Even more important than the professional argument over health care cost projections is the recent trend in health care costs. While the CBO projections assume that age-adjusted health care costs rise considerably more rapidly than per capita income, in the last four years they have been roughly keeping pace with per capita income.

In fact, in the last year nominal spending on health care services, the sector that comprises almost two-thirds of health care costs, rose by just 1.7 percent. This is far below the rate of nominal GDP growth over this period, which was more than 4.0 percent. While at least some of this slowing in health care costs is undoubtedly due to the downturn, it is hard to believe that it is not at least partially attributable to a slower underlying rate of health care cost growth.

CBO and other budget forecasters can ignore economic reality for a period of time (they ignored the housing bubble until after its collapse wrecked the economy), but if it continues, at some point they will have to incorporate the trend of slower health care cost growth into their projections. When this happens, the really scary long-term deficit numbers will disappear.

A projection that assumes that health care costs will only rise as a result of the aging of the population, and otherwise move in step with per capita income, will lop tens of trillions of dollars off the most commonly cited long-term deficit projections. It would cost some deficit hawks, like National Public Radio, more than $100 trillion of their long-term deficit story. This would be a real disaster for the deficit hawk industry.

This is why the Campaign to Fix the Debt and the rest of the deficit hawk industry will be operating at full speed at least until a budget deal is reached over the current impasse. If CBO adjusts its long-term health care cost projections downward then their whole rationale for gutting Social Security and Medicare will disappear. Now that is really a crisis.

And in light of today’s horrid front-page News & Record article on the so-called fiscal cliff, here’s a question for Greensboro peeps: Would it really be too much trouble to get Jeff Gauger and his crew at the N&R to introduce some fact-based economic coverage? The voters last week seemed to indicate a taste for that kind of thing.

Tuesday, October 30, 2012 4:44 pm

Quote of the Day, Athenae on Sandy and the Govt. Edition

What it boils down to is: What kind of country are we going to be — the kind people want to live in, or not?

When a disaster strikes I want big government, small government, medium-sized government. I want all the government ever. I want the neighbors and the charities and the churches and the families and the friends, too. Every crack in the plaster needs to be patched and every problem needs to be solved, and I want as many people putting that puzzle together as possible. All hands on the [expletive] deck. Here’s a bucket. Start bailing the water out.

I want everybody to be figuring out how to do more, instead of fighting over the best way to do less without looking like too much of an [expletive] about it.

And you know, I think the majority of Americans want this, too. It’s just that for the past 40 years we’ve had this constant drumbeat of no we can’t, it’s too hard, we can’t afford it, everybody fends for themselves, there’s no help for anybody, let’s all just go home and if you have to step over a homeless dude to get to your car then do it because that’s the price of doing business. People deserve to have their homes submerged and their shops wiped out and their lives ruined because of where they live or what they do or who they are, and there’s nothing anybody can do about it, because only government is big enough to solve this problem and we all know government isn’t the answer to anything anymore.

But deep down we’ve still got that nagging feeling that somebody somewhere ought to be on top of [stuff] that most of the time people don’t deserve what they get (and thank God for that, by the way, she says while conducting the express train to hell), that we are better and bigger and stronger than this, and we’re just straining against the goddamn harness to do something. And disaster preparedness and emergency management are some of the most basic things government can do to prevent us from tearing ourselves apart when something [awful] happens, to take that instinct and direct it outward instead of inward.

To make us help, rather than letting us hurt.

I made the mistake earlier today of getting into an argument on Facebook with a couple of wingnuts. They argued that “compulsory charity” — which, for reasons that escape logic and which they declined to explain, they defined strictly as “government” charity; guys, go tell it to the LDS Church — is always wrong. (They also argued that abortion is the biggest sin there is, but then consistency is seldom a hallmark of wingnuts.)

Jesus said to render unto Caesar that which is Caesar’s, and to God that which is God’s. The implication, often offered up by wingnuts as stone fact, is that the two differ. And certainly they frequently do. But there’s no practical or metaphysical reason why the two couldn’t overlap from time to time, as in, say, stopping the Nazi genocide machine.

Or helping our fellow Americans, our family, our friends, our neighbors to get their lives back in order after an unparalleled natural disaster.

No one with a lick of sense will claim that he knows what Mitt Romney believes, but it is a matter of public record that Romney has said that private interests ought to be responsible for disaster recovery. Given that mutant weather alone is likely to become an important aspect of our new normal in this century, that claim alone disqualifies him from any role in government. And yet somewhere around 50 percent of Americans say they are ready and willing to make him president, as if, in this “Christian” nation, the Golden Rule and the Second Great Commandment were tiny codicils in the articles of incorporation for a company that Bain Capital long ago acquired, stripped of its assets and steered into Chapter 7.

Friday, October 26, 2012 7:43 pm

Republicans and rape; or, zygote fetishization

The recent comments on rape from a long list of Republicans including Mitt Romney, Paul Ryan, Richard Mourdock and Todd Akin, along with the fact that the GOP’s national platform has opposed safe, legal abortion since 1980, have brought “social issues” to the fore in a national election that ordinarily would have been almost entirely about the economy. (Not arguing that it should have been almost entirely about the economy — I’d’ve loved some discussion of global warming, Afghanistan and using drones for extrajudicial assassination, to name just three topics — just that it ordinarily would have been.)

I won’t rehash the moral arguments about abortion, but I will offer this quasi-theological observation: The people who argue that their faith dictates that a woman who is raped and becomes pregnant must carry her rapist’s baby to term are not worshiping God, or any god. Rather, they are fetishizing a zygote. Their “culture of life” has become the idolatry of a cargo cult. It is nothing that Jesus would recognize as God’s love here on Earth.

With her gracious permission and without additional comment, I offer this take from my mother’s cousin Edith Hay Harris of Houston, Texas* Durham, NC:

My two cents: I was a volunteer for Greenville (SC) Rape Crisis Council for 8 or so years, some time back. I don’t think anyone can imagine what these women and girls endured. I think a lot of people don’t realize victims come in all ages and from all walks of life. I still remember a woman with a husband and children who became pregnant from the rape and had to have the baby; a 68 yr old grandmother who was nearly beaten to death by her attacker who put her grandson’s training pants over her face while he raped her; and a 12 year old who was impregnated by a homeless man. In the last case, we took her to Atlanta for an abortion, since no one in Greenville was providing that service then, and United Way dropped us from their funding for doing so. So, yes, I still feel that rage so many years later. I think these Republicans actually have contempt for women and need to control them. Sort of reminds me of the Taliban.

*Oops. Cousin Elsie lives in Houston, not Edith. I knew this.

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