Jon Stewart: Prime Mover in Passage of 9/11 First Responder Health Care Bill?

Snowed in in alien territory. Bereft of print edition.

According to Bill Carter and Brian Stelter's article on the New York Times website today, a major force behind the passage of the health care costs of the 9/11 first responders was Jon Stewart, the host of the Peabody-winning "The Daily Show" on Comedy Central.

"I don't even know if there was a deal, to be honest with you, before his show," said Kenny Specht, the founder of the New York City Firefighter Brotherhood Foundation, who was interviewed on Stewart's show on 12/16, which was solely devoted to that cause.

Even New York City Mayor Bloomberg, a frequent guest on the show, recognized Stewart's achievement. This is not to diminish the good Senators from New York, Charles Schumer and Kirsten Gillibrand. The idea is that the focus of that show may have had an impact on the Republicans' only blunt tactic, the filibuster. They stopped the bill from passing on 12/10.

The article goes on to contrast Stewart's role with that of Edward R. Murrow, who was one of the very few (maybe the only) on-air personalities to speak out against the corrosive depradations of Senator Joseph McCarthy during the 1950s, when his tactic was fear of Communism. McCarthy was very effective and powerful. Even President Eisenhower tip toed lightly around him. It was only when McCarthy began investigating and accusing the American military and the state department of Communistic leanings that he was called out and his power waned.

The irony is that the McCarthy hearings where he attacked his enemies were also televised to a much wider, less fragmented audience than would be possible today. This makes Stewart's acknowledged achievement all the more impressive.

The 12/16 show was divided into two parts: the first was on the Republicans and their automatic use of the filibuster to block every initiative in Congress; the second took the broadcast networks to task for barely covering the vote in the months preceding it.

I remember very well the Republicans' use of 9/11 (especially former Mayor Rudolph Giuiliani) as a stepping stone for their political careers.

Maybe Stewart is the figure shaking things up in Washington because he offers an alternative to the blandishments and inside-the-beltway coziness of the Washington media.

As Robert J. Thompson, Professor of Television at Syracuse University, said:

“I have to think about how many kids are watching Jon Stewart right now and dreaming of growing up and doing what Jon Stewart does,” Mr. Thompson said. “Just like kids two generations ago watched Murrow or Cronkite and dreamed of doing that. Some of these ambitious appetites and callings that have brought people into journalism in the past may now manifest themselves in these other arenas, like comedy.”

Atypical Mortgage Modification Shines Light on Serious Housing Problems

Gretchen Morgenson's article in today's Business Section of The New York Times is vital reading for everyone in America who is concerning about the continuing and alarming housing crisis. She discusses the atypical case of Robert and Amy Ahleman, who are a construction contractor and a financial services employee, respectively. When they missed one payment on their small home their loan servicer immediately began charging default fees and sending threatening eviction notices.

At the current rate, the Treasury Secretary's main foreclosure prevention program, HAMP, will stop about 700,000 foreclosures, much fewer than the 13 million expected by 2012. Unfortunately, Elizabeth Warren, the Harvard Law Professor who fought so fiercely for a consumer advocacy program with enforceable powers that was left out of the financial reform bill, was named to a special advisory role on the Congressional Oversight Panel, which was created in 2008 to monitor financial markets and those who regulate them. It is basically a ceremonial role.

HAMP (Home Affordable Modification Program) was devised under Treasury Secretary Timothy Geithner. Under it, loan servicers (which are often owned by large banks) are voluntarily coerced to modify mortgages to prevent foreclosure. They are paid $1,000 per modification. Foreclosures don't benefit anyone but the servicers. The homeowner is evicted, the property values of the surrounding areas go down, and:

Investors who hold the loans in securitization trusts are also hurt by foreclosures, because recoveries on these properties are so low.

Consumers feel (and are) less rich, they spend less, and because many mortgages are underwater (that is, the homeowner ends up holding a mortgage that is more expensive than the plunging value of their home), people are less mobile so if job opportunities dry up in their region, they are less able to move to an area where jobs are growing. Mobility was always a staple of American capitalism.

Foreclosures are much more lucrative to loan servicers than what the HAMP program pays:

[L]oan servicers can profit significantly by pushing borrowers into foreclosure. It gives the servicers more opportunities to keep charging lucrative fees and little incentive to seek a modification.

As Kurt Eggert, a professor at Chapman University School of Law in Orange, CA said:

"I think a big part of the problem is that nobody is effectively holding servicers' feet to the fire to say 'where are the loan mods that you should be delivering that help both borrowers and investors?"

After the Ahlemans, desperate to save their home, filed for bankruptcy in late 2008, their servicer was changed to Litton Loan Servicing, a unit of Goldman Sachs. Ms. Ahleman asked Litton repeatedly for a modification but heard nothing back. Finally, after a reporter contacted Litton, they quickly responded by cutting the Ahleman's variable interest rate from 9.3% to a fixed rate of 4.5% (about the current fixed rate in the marketplace). It also agreed to waive its $38,882 in arrears on their mortgage which included late fees and legal costs. Remember, Litton did not respond to the Ahlemans for months. That certainly increases late fees.

Meanwhile, the bank that held their second mortgage at a 12% interest rate, Banco Popular, wrote off the Ahlemans entire loan of $62,000, which also included late fees.

Under the terms of the new loan, the Ahlemans' mortgage obligations dropped from almost $250,000 to roughly $198,000. Their monthly payment fell from $1959 to $1376.

The Ahlemans have since made all their payments and don't use credit cards any more. "If we can't pay cash, we don't buy it," said Ms. Ahleman.

The Fighter is a Champ

Should be cross-posted from IMDBPro (which is a subscription-based version of imdb.com)

Curious to see why The Fighter was nominated for 6 Golden Globes. Had great word of mouth. But wasn't it just another boxing movie? No no no.

The Fighter is a movie that works on so many levels it's as dense as a
black forest cake. Based on a true story set in Lowell, Massachusetts,
about two boxing half brothers (their mother had a lot of love to
give), Mickey Ward, played by Mark Wahlberg and Dicky Eklund, played by
Christian Bale, it opens with Bale and Wahlberg sitting on a living
room couch. Bale is a revelation; motor-mouthed, twitchy, punchy, and
doesn't seem to have a lot upstairs. Believe that at your peril.
Wahlberg sits quietly next to him. He's the kind of actor you can
actually watch thinking.

Dicky's claim to fame is that he once knocked down Sugar Ray Leonard
(who makes a brief cameo appearance). Now both he and Mickey are part
of a road crew when they're not in a gym. Dicky trains Mickey for
fights his mother the gorgon manager sets up for him, one of which puts
him in the hospital.

The way The Fighter surprises and confounds your expectations keeps you
on the edge of your seat, along with director David O. Russell's
cutting back and forth between parallel scenes of Dicky on the prison
phone with mother while Mickey battles a powerful Mexican opponent.
It's like cage match dancing.

The fights are not just physical. The family and girlfriend fight for
Mickey's allegiance. A new manager pits Dicky against his brother.
Which ties will be stronger: the anguish of the family or the tempting
opportunities? The low ebb between the brothers comes when Christian
Bale, desperate to compete with an outside offer to pay for training
for Mickey, pimps out his girlfriend and gets into a fight with the
cops. Mickey hears the commotion and runs to intervene, only to have
his right hand crushed by an overly zealous policeman.

An HBO movie-within-a-movie ties the characters and the action even
more tightly. Bale (and the viewer) believe the documentary is about
his knockout of Sugar Ray Leonard when it is actually about his
downfall due to crack addiction. As Bale watches the documentary in the
prison auditorium surrounded by fellow inmates, Russell cuts to
Wahlberg desperately calling his ex-wife to ask her not to let their
daughter watch it. She gleefully refuses, telling him she want her to
know what kind of man he is. In another scene the bleary eyed mother
shoos Bale's little son away so he can't watch it. Christian Bale
suddenly realizes that he is the subject as the crack addict as we hear
the filmmaker within the film say Bale will end up in either the
cemetery and prison. Cut to Bale's face behind bars.

The fights are taut and visceral. You can feel the body blows and get
into the clinches. It all leads up to the climax which reveals the true
nature of the brothers' ties

The cast, especially Bale who seems to do his own stunts jumping out of
a second story window several times, are great. Amy Adams plays
Wahlberg's love interest, a salty tongued college-educated bartender
who is one of the very few characters who is not afraid of mother. She
can give as good as she gets and doesn't take guff from anyone.

Wahlberg is terrific with intelligence, torment and restraint written
all over his face. He's the rock who's shuffled aside by the mother's
fantasies of Dicky's comeback and bears gamely under his ex-wife's
abuse and his family's manipulations. I read that he trained for three
years to get into shape for the movie and it shows.

Making a movie is a collective, lengthy enterprise, and several people worked on the story: Writer (screenplay) Paul Tamasy; Writer (Screenplay/Story)/Producer Eric Johnson; Writer (Screenplay)(Story) Keith Darrington; and writer (story) Dorothy Aufiero.

Aside from acting in the movie, Mark Wahlberg was also one of the main producers and shepherded the project for several lean years before it got into theaters.

Taibbi's "Griftopia" Is A Bracing Tonic, Shaken Not Stirred

Matt Taibbi, a contributing editor to Rolling Stone magazine known for his (how you say?) ascerbic (I was going to say f**k u style, but didn't want to push it), famously calling Goldman Sachs "a giant vampire squid wrapped around the face of hunamity, relentlessly jamming its blood funnel into anything that smells like money." The guy don't pull no punches, eh?

He came out with a new book Griftopia, reviewed by Peter Goodman in this Sunday's New York Times Book review section. Griftopia covers the pungent ground of the 2008 and counting financial disaster that sprang from the loins of Wall Street aided and abetted by many "tentacles".

We all know the polite, papered over explanation for the crisis. Profligate poor people and minorities borrowed money they could not pay back and weren't supposed to be homeowners anyway, simply to redecorate their wood paneled basements and koi ponds. Risk management was too complicated and regulators were merely government employees who couldn't possibly compete with Saville Row tailored Wall Street lawyers. So shrug your shoulders and say, what can you do? That's the price we pay for the free-wheeling casino of Wild West capitalism.

The truth is that the FIRE (finance, insurance, and real estate) divisions make huge bucketloads of money and are a disproportionately represented on the DJIA. They are major players writing financial legislation and they were certainly all present and accounted for back in the second half of 2008.

Let's look at one factor. At the time when A.I.G., the largest insurance company in the world, collapsed under the weight of its insurance claims (ahem I mean credit default swap obligations) and threatened to go bankrupt, the Treasury stepped in to bail it out without any authorization except what it conjured out of thin air. It simply willed the takeover.

You see, my children, in the old days (pre-2008) the government would only lend money to commercial banks which were more tightly regulated. Timothy Geithner decided to pay full price (100 cents on the dollar) to all AIG counterparties (even though some were willing to pay less). This especially benefited Goldman Sachs, also known as the company that created and sold poorly constructed collateralized debt obligations (CDOs) to unsuspecting investors (read: pension funds) in order to bet against them and collect both ways.

Ordinary people may think the bailouts to these "Too Big To Fail" banks are over but the lending library is stil open doling out cheap liquidity to TBTF banks like Citigroup. As far as I know, none of these banks have had to write off the bad "exotic financial vehicles" (like CDOs) on their balance sheets. No mark-to-market accounting, so you never know how solvent they really are. That's like lending money to your brother-in-law who assures you he's going to pay you back but you keep seeing repo men knock on his front door.

Because the banks know they are "To Big To Fail", they know the government won't let them fail, which allows them an advantage over all other smaller banks because they can borrow money more cheaply. And take more extreme risks with your money. They get paid upfront, so it doesn't matter how the deals they make unwind. And they're still in charge, more powerful than ever. There are less of them (the power is more concentrated) and as opposed to 2008, they know now the U.S. will bail them out undoubtably.

The losers in all of these speculative transactions are pension funds, the money set aside for your retirement. And people like Governor Christie of New Jersey are already making noises about defunding pension plans.

Our states, cities and municipalities which, because of the recession, have lost tax revenue and have had to institute severe austerity measures (like not fixing crumbling highways and bridges and selling off valuable properties) shoud be given the same opportunity as the TBTF banks: offered cheap money to be put to use right away for hiring people to work on capital projects. Employed people pay taxes, feel better about themselves and their families, and buy more things upon which they pay sales tax. That would increase revenue, and enable the entities to pay back the money with interest. In fact, in terms of human capital, compound interest.

Shout Out for Jimmy Wales/Wikipedia

Always at the top of the search engine, fast, accurate, malleable--he's doing it for love and Xmas. Happy 2011!

40: A Doonesbury Retrospective

Dwight Garner's review of Garry Trudeau's Pulitzer-Prize graphic chronicle over the past 40 years floods me with so many memories. I don't have the book itself, so I'll rely on them. Mr. Garner paints things in delicate strokes. I'll just describe an encounter I had with Mr. Trudeau some months back at an esteemed institution in New York City where he had spoken and was signing copies of his new book.

I just found out he was there and was so happy to meet one of my heroes I ran into the auditorium to see if he was still there. An usher gave me a program and let me meet with him even though he had probably given a lecture and spoke personally to a long line of admirers. I asked him what he was working on. Because of his BD-focused storyline, I knew he was concerned about the soldiers in Afghanistan and Iraq. I wondered if he was going to tackle one of the seldom spoken of issues of injured soldiers, that of traumatic brain injury. He graciously signed my program and told me that he did indeed prepare strips on that issue.

Beside being a Pulitzer-Prize winner, Mr. Trudeau is married to Jane Pauley and has three children. He attended Yale University and received his M.F.A. in graphic design at the Yale School of Arts in 1973.

Mr. Garner also mentioned "Mike's crunchy and delightful daughter," Alex Doonesbury, who gives the reader (at least, this reader) a little bit of the sense of what it's like to study at M.I.T., chatting with a girlfriend, inventing, and dealing with suitors.

Hopefully Mr. Trudeau will continue to touch on history for years to come through his appealing characters, adapting and adjusting to the zeitgeist.

Glad Tidings Re: Job Openings

According to Indeed Inc., which runs indeed.com, one of the job search web sites I utilize which aggregates a lot of jobs in one place, there is quantifiable growth in job openings as proven by internet postings.

According to James Hagerty and Joe Light's article in the Journal, it looks like new areas of growth are in retailing (hey, must be! Growth in spending in 2010 at the busiest time of the year for retail, Christmas, is inching up towards double digits from year ago), accounting, consulting, health care and telecommunications.

Indeed Inc.'s data may be misleading (as statistics are wont to be). Some jobs simply aren't posted online. That's why it's always good to do things like network face-to-face or ask politely for informational interviews from someone whose successful in the field in which you want to work. (Don't mean to toot my own horn but I worked a lot in the help-get-people-jobs field: job coach, employment counselor, whatever you want to call it--I could shape up a resume and prepare someone for an interview in an hour.) Word of mouth is also important. Let people know who you are. Have a business card (you can make them cheap at different copy places around the city) to hand off to a busy person who might not remember you.

Sorry for the tangent. Farming, manufacturing and construction jobs aren't generally posted online, while computing and mathematical jobs are overrepresented, said June Shelp, an economist and vice president for the Conference Board, a private research group.

To be sure:

[T]he postings data offer only a partial and unofficial look at the labor market. Job losses in the recent recession have been much worse relative to output declines than in previous slumps, and official payroll data so far haven't shown signs of a big rebound in hiring.

While some big companies are expanding, others are merely replacing workers who are retiring or otherwise moving on. and many of the available jobs require experience and technical expertise that few job seekers can muster. Jobs that don't are still seeing a flood of applicants for each opening.

More on this article later. It's Christmas Eve Day and time for an egg nog break. I'll leave you now with some advice: in an interview, be there 5 minutes early. Show respect to everyone at the company on any level. Keep eye contact but don't stare at your interviewer as though your eyes were laser beams. And I totally recommend interview practice, practice, practice. That's what best friends are for.

Census Results Should Prod Democrats Into Action

The results of the 2010 Census are out, and things don't bode well for the Democrats. In Sabrina Tavernise and Jeff Zeleny's article in the New York Times, it is clear that that there were gains in the South and West, areas that contained states that President Obama squeaked by in 2008, and states in which he will have difficulty winning in any case.

Texas gained 4 seats while New York and Ohio lost two, respectively.

The Census draws the map for redistricting the vote. In other words, the number of members of the house are determined by the Census and the state legislatures, which became redder than ever after the recent election, draw the districts from which representatives are elected.

Florida, the original recount battleground in 2000 where Al Gore won the popular vote yet lost to George W. Bush as a result of the Supreme Court's decision in Bush v. Gore, gained two seats. President Obama squeaked by in 2008. The Republicans have made it clear that their main goal for the next two years is obstructionist; that is, they don't care about passing legislation, they care about making President Obama a one-term president.

Although the population increase in the South and West cut inroads into 2008 battleground states, a great deal of the population growth was Hispanic. If the Democrats want to take advantage of that growth, they have to strategize better than they have in the past and appeal emotionally to potential voters. They have to address the immediate concerns of Hispanic voters. The Democrats are generally on the defensive fighting off Republican accusations. Instead, they have to go on the offensive.

I worked as a volunteer tutor in an English as a Second Language (ESL) program. Many of my students were Hispanic mothers (their children were often in the classroom also). They wanted the same things as any other family: a good education for their children, a step on the ladder of the American dream:

[T]he influence of Hispanic voters, particularly across Arizona, Nevada and Texas...underscores the urgency facing both parties in find new ways to appeal to Hispanics. In future presidential races, Democrats believ they can make inroads into Arizona and Texas, which are traditionally carried by Republicans, particularly if voters speak out against Arizona's tough immigration law.

I lay odds that Republicans will push Democratic buttons before the 2012 election. The Democrats have to show some spine and go on the offensive. Otherwise, they'll miss their opportunity.

What Really Happened at Lehman: Maybe Its Auditor Knows For Sure

For the first time since the beginning of the financial crisis, a major financial institution duty-bound to certify the soundness of a huge investment bank might have civil charges filed against it. The targeted firm is Ernst and Young, one of the big Four audit and accounting firms. There used to be Five, but Arthur Andersen, which audited Enron, dissolved soon after Enron did in 2001.

Governor-elect and still attorney general Andrew Cuomo is close to filing charges that Ernst and Young stood by while Lehman lied about the risks it was taking with investors' money and employees' lives which led to its bankruptcy. Many economists believe that Lehman's bankruptcy helped trigger the devastation that followed.

In Liz Rappaport and Michael Rapoport's article in the Journal, Cuomo is investigating whether Lehman engaged in "window dressing", also known as repo debt (Lehman called the activity "repo 105), where banks borrow money on a short-term basis so they can take bigger risks. The more money you can play with (especially borrowed money) the more risk you tend to take. When it came time for quarterly reports, Lehman would lower its repo debt to make it look more sound to investors.

Instead of accounting for Repo 105 as loans, Lehman called them "securities" and Ernst and Young nodded in approval. After Lehman went bankrupt in September 2008, the bankruptcy examiner found that Lehman had moved some $50 billion off its balance sheets:

The attorney general's investigation, which began after the bankruptcy examiner's report, found that Ernst and Young specifically approved of Lehman's use of Repo 105 transactions and provided the investment bank with a complete audit opinion from 2001 through 2007.

Other big banks, such as Bank of America, also engaged in "window dressing". Earlier this year B of A disclosed 6 dubious transactions.

There was a whistleblower at Lehman, Matthew Lee, senior vice president, who complained that Repo 105 violated Lehman's ethics code. He put his concerns in a letter to senior Lehman executives 4 months before Lehman's collapse. As gratitude, he was fired. Ernst and Young did see the letter and said that Lehman management determined that Lee's "allegations were unfounded."

Shades of Enron. Enron was an energy trading company based in Houston which also worked cozily with its accounting firm to hide massive amounts of debt using special investment vehicles. Again, employees and shareholders were left holding the bag. The situation was certainly rigged for the employees: they were only allowed to invest in Enron stock for their 401-Ks. Enron collapsed at the end of 2001. Its share price went from +$90 in mid-2000 to less than $1 in November 2001.

At least a high-level executive, Jeffrey Skilling, went to jail in that case on multiple federal felony charges.

Now Comes the Harder Part: Integrating "Don't Ask Don't Tell" Into Military Culture

The policy of "Don't Ask, Don't Tell", allowing soldiers who are openly gay to serve without fear of expulsion, was finally repealed by the Senate on Saturday. It awaits the President's signature.

But even if the repeal is on the books, frontline combat culture wil take time to adjust. According to James Dao's article in the New York Times, who canvassed the views of some Marine Corps infantry troops, they expressed similar worries about serving with openly gay men: that they won't hold up well in front line combat units, that the units depend on cohesion and bonding over traditional "macho" pursuits, and that there is something too "feminine" about them.

An officer leading troops in Afghanistan said he anticipated that many openly gay soldiers would feel alienated from their straight colleagues.

Some Marines expressed the sterotype that a gay man is more like a female, a stereotype that not only distorts gay male contributions but also stereotypes female soldiers as weak.

Corporal Trevor Colbath, 22, a Marine who returned from Afghanistan in August said:

"Maybe they should just take the same route they take with females and stick them in noncombat units."

I think Colbath should ask some female soldiers if they fight and risk their lives similarly to his colleagues. He might be surprised at their responses. He might have to duck and cover.

Private First Class Alex Tuck, 19, had a different take. He said openly gay men would perform well and be accepted. But his friend Private Justin Rea, 18, echoed the "girly man" sentiment:

"Being gay means you're kind of girly. The Marines are, you know, macho."

The irony is that gay men already serve honorably and well in dangerous conditions. DADT kept them in the closet. Anthony Wilfert, 25, was trusted in combat. He said several colleagues, including superiors, knew he was gay. He was promoted to sergeant.

Eventually, though, he was discharged under the "Don't Ask, Don't Tell" policy. Now that the policy is one stop from repeal, he's thinking of re-enlisting.

Strange Brew

For some strange reason, when my ex-domestic partner went to my profile tab, he told me that instead of having a list of my personal information: interests, education, work history, etc., it has a steady stream of his comments. I did not authorize this information to be placed there. My cousin told me I sounded unduly hostile. That was not my intention. I'm sorry if any of the readers of this blog got that impression.

UPDATE: Just callin' them as he told me. I submit to a higher power. All families, children, dogs, everyone, my family, your family, have a great Xmas and a Happy 2011.

Another 2011 Spirit Awards Best Picture Nomination: Winter's Bone

Cross-posted from imdb pro:

Winter's Bone, which was originally a novel by Daniel Woodrell, made
into a movie by director Debra Granik, is an original, powerful story
of a 17-year old young girl who tries in the face of unbelievable odds
to keep her family together. The movie takes place in the Ozarks in
Missouri, but the life there feels so alien to this viewer that it
might as well be set on Mars.

It has overtones of ancient tribal behavior with its own code of law
and ethics. The fabulous actress who is the prime mover at the center
of the movie is played by Jennifer Lawrence. She is Dee Dolly,
searching for her drug dealing, oft-jailed father whose disappeared,
then revealed to have put up their home for collateral, jeopardizing the family's shelter. Dee cares for her catatonic mother and two young
siblings. They have no money and despite her pride, she accepts
grudging help from neighboring farmers. Dee is the glue of the story
which focuses on her journey of overcoming unfathomable obstacles. No
one, even her close friends, will help her. Her life becomes as alien
as the terrain. Not only do they refuse aid, her pursuit puts her life
in jeopardy. She learns to function even when there is no one she can
trust.

The town has lost all industry. The only way to make money is to
manufacture methamphetamine. Dee moves forcefully through the mine
field in order to keep her family together, safe and sheltered.

I feel compelled to repeat it: 17-year-old Jennifer Lawrence is a
revelation, determined and unafraid. You fear for her but she is
fearless.

Debra Granik's direction, with its ability to reflect the barrenness of
the landscape and to coax powerful performances from her actors, is
praiseworthy. One of the few women directors (at least that I'm aware
of) with a good distribution deal.

The 2011 Spirit Awards are presented on IFC on February 26, the day before the Academy Awards.

*Sorry for choppy copy editing

2011 Spirit Awards: Best Movie Nominations

Saw a great movie. 127 Hours. It's based on a true story; most who come to see it are aware of its dreadful climax. But it's also the story of a man who heads out on his own to test his abilities against natural elements. Nature is unpredictable. And through no fault of his own, he winds up having to make a very harsh choice in order to survive.

127 Hours was directed by Danny Boyle of 28 Days Later and Slumdog Millionaire. Boyle has range. 28 Days Later is the story of a mysterious "rage" virus that decimates the London (and environs) population, turning people into ferocious zombies, and Slumdog, well, it won the Academy Award for best picture.

But the actor James Franco, pretty much the sole center of 127 Hours has to hold the audience's attention during the entire running time, when they're set up and waiting impatiently for the unthinkable. He's stuck between a rock and a hard place, he's funny and you can see him thinking, not an easy stretch for an actor (no offense meant).

This ole guitar-strumming cat recommends it thumbs all the way up.

Euro Crisis: What Happened at the European Summit

Our breathless story continues. They held the European Summit in Brussels and everybody showed up, at least according to Walker & Forelle's article on today's Journal website.

Did they solve the crisis? Well, they did endorse a plan for a new bailout fund to replace the one expiring in 2013 and proposed treaty changes, but somehow that didn't calm the markets. Spain had to offer very high interest rates on its Thursday bond offerings. As mentioned before, Greece and Ireland had to accept bailout funds, which means they now take marching orders from the European Union and the IMF (International Monetary Fund). Portugal is next in line.

The European Central bank tried to reassure the markets.:

[It] said it will nearly double its capital base--a move analysts see as a strong signal to government leaders that the central bank's loans to banks and its purchases of government bonds of the regions weakest economies carry a risk. The added capital comes through a transfer of assets from each of the euro zone's 16 national banks.

Details are sketchy, but the new fund will probably run along the lines of the old one, about 750 billion euros ($992 billion). The proposed treaty will have to be agreed upon by each of the 17 members of the Eurozone. At least the language is simple. It consists of two sentences:

[I]t permits the Eurozone countries to establish a "mechanism" if "indispensable" for the health of the Euro.

That's kind of vague and broad. Shades of "systemic risk"? Or "too big to fail"? In the case of "too big to fail", the implication is that the U.S. Fed will back risk with its full faith and credit. Is this treaty language similar? What defines "indispensable"?

Zone countries need to raise about $2 trillion in 2011. To quote, "If Europe's governments fail to put their bickering aside, they risk triggering the unthinkable, the implosion of the Euro", evoking painful memories of past financial crises.

I am not writing this to encourage speculation on the downfall of the euro. I do not enjoy vultures feeding on carrion. I really want to see a solution to a very complicated, unprecedented problem.

Musing on Blogging and the Randomness of Life

Sometimes, when you try to make a difference, you ruffle a few feathers. I want to do the right thing (stole that from Spike Lee) and write about business, a subject vital to our country. This is a field I studied and know.

You don't have to look it up: I didn't graduate from Wharton or Tuck. I did get into NYU's MBA program back in the early 80s and was there for 2 weeks and I worked at Goldman in their bond department as a temp sales assistant around the same time. Very exciting. No, I did it the Lincolnesque way; I studied book after book, from Galbraith's "The Affluent Society" to many others, but what really influenced me to the point of taking copious notes was Charles Morris' "The Trillion Dollar Meltdown" which came out in 2008.

It’s funny; I’ve been writing Cassandra since 2007 and nary a peep. Even Cassandra can’t predict the future.

Thanks for listening. Back to our regular programming.

Is Spain's Example Our Fate?

Today (Thursday), Spain plans to sell up to 3 billion euros-worth (that's about $4 billion) in 10 to 15 year Spanish treasury bonds because it has to finance its considerable national debt. According to William Mallard et al's article on yesterday's Journal website, one of the credit rating agencies, Moody's, threatened to downgrade Spain's debt. Its current rating is Aa1, one notch below triple-A, the gold standard for large fixed income pools in the U.S. (Read: pension funds like CALPERS).

Spain is a major Eurozone economy and there seems to be the sort of domino effect I wrote about in my earlier "Dire Euro" posts. On Wednesday, Portugal sold 500 million euros of shorter term debt (3 month bills) at an average yield of 3.4%, up from 1.8% only a month and a half ago. When investors heard Moody's rumblings, Spanish debt yields rose but flattened out. Theory may be that Spanish costs have already risen so much as to factor in this news. Its yield on 12-18 month bills are more than 1% higher than one month ago.

As in the U.S., Spain is suffering from a long binge and the collapse of an overheated housing market. Unemployment is over 20% Austerity measures have been put in place, as they have been in the other faltering Euro countries:

Responding to intense pressure from markets and the European Union, Prime Minister Jose Luis Rodriguez Zapatero has stepped up efforts to cut its double-digit budget deficit and spur economic growth. He forced through an austerity budget that included tax hikes and deep spending cuts for this year and next. Earlier this month, he announced a series of economic measures to raise about 14 billion euros through the partial privatization of the national lottery and airport operator AENA, as well as the managment of Madrid's and Barcelona's airports.

You cannot win your way back to prosperity by selling your country's treasures on the cheap. That's a one shot deal at fire sale prices.

Very soon there will be a European Union summit. Maybe not soon enough. Hopefully there will be solutions hammered out dealing with the unsustainability of escalating debt in the face of recession, high unemployment and harsh austerity measures. There is a bailout fund, the European Financial Stability Fund, that Greece and Ireland had to utilize. But that expires in 2013.

The U.S. cannot look away from the problems in the Eurozone. We are competing in a global marketplace. Sooner or later, unsustainable debt levels for a country become prohibitively expensive. We (or rather, U.S. politicians) have to make choices. And no one wants to eat cat food.

No man is an island...
Send not to know
For whom the bell tolls,
It tolls for thee.

Obama's Affordable Health Care In Serious Jeopardy

According to Kevin Sack's article in the New York Times, Federal Judge Henry Hudson of Virginia ruled that the mandate that most Americans obtain insurance "exceeded the regulatory authority granted to Congress under the Commerce Clause."

That's a mouthful of legalese. In essence, the federal judge ruled that people cannot be compelled to pay into the insurance fund that will cover the costs of Obamacare. The idea behind such a mandate is if you have the widest pool of people participate, both the sick and the healthy, insurance risk is kept down and costs stay affordable. Without such a mandate, it's most likely that only the sick or those fearing illness and needing health care coverage will pay the mandate. Costs would probably become much higher because health insurers would consider those purchasing the mandate risky customers (Read: more likely to file claims) and charge accordingly.

In America we are compelled to pay for automobile insurance because theoretically there's a future risk of liability (someone might get hurt).

By contrast, the plaintiffs in this health care case argue that the new law requires people to obtain health care insurance simply because they exist.

By this logic, you can extrapolate further and assume that the judge's holding will lead to exorbitantly expensive fees for the ailing and those fearing future risk that they will get sick and need health insurance. Therefore, they will not exist.

The Dire Eurozone Crisis Part II

To pick up from my previous post, German Finance Minister Wolfgage Schauble's comments about how to deal with the growing crisis of nonpayment of debt "suggest Germany is prepared to go much further than many observers had expected to defend the euro." They may be ready to establish some sort of federated system to transfer money from fiscally sound to struggling countries.

Some background: Ireland was in dire straits recently and received a 70 billion euro ($93 billion) bailout/rescue package which failed to calm the markets. In fact, observers are worried about a domino effect, because other Eurozone countries (as is true for many countries in the world without shared currencies) are on shaky ground. They're especially worried that the crisis will hit Spain, one of the region's largest economies suffering from high debt levels and sky-high unemployment.

A Spain rescue would largely exhaust the EU's nearly trillion-dollar bailout fund and focus attention on the sustainability of government debt in countries at the core of the eurozone economy, especially Italy.

At that point, the cost of the bailouts would be too high to keep the euro zone together, some economists warn.

There's still more to come. I'm actually merely critiquing the article by Marcus Walker and Matthew Karnitschnig in the weekend Journal, "Germany Vows Defense of Euro", so if you see me misrepresent your work, let me know.

Focus on the Euro: Something's Dire

The most pressing difficulty weighing on the world's economy right now (and this phrase understates its enormous size and difficulty) is the Eurozone/Euro problem. The Eurozone is an artificially created conglomerate of disparate European nations, each with its own strengths and weaknesses, all sharing the same currency, the Euro.

I find the growing problem of the Euro difficult to understand. Turned to the Journal yesterday to find out why investors were panicking and credit spreads widening by the minute. Here goes:

Not all countries are created equal. Some countries have stronger economies than others (Germany and France versus Ireland and Italy). The weaker countries suffer from a combination of too much debt and too little wherewithal to ever repay it, particularly at a time of global recession. This is creating huge panics across the board. Weaker countries have to pay enormous sums in interest to attract investors to its bond offerings, and sometimes they have no takers. The Euro, the world's second largest currency, is in danger of collapse.

The Finance Minister of Germany (the most prosperous country) , Wolfgang Schauble, has hinted it will lead the way to preserve the Euro. This shows a certain amount of bravery on his part. A lot of Germans have the not uncommon feeling, "Why should we have to pay for the profligacy of the Italians or Irish, not to mention the Spanish?" Well, they may not share common national boundaries but they do share a currency, just like the collar, in which they traded, sold, bought, borrowed, stole and now there's got to be solutions on the table.

I've written about this not too long ago in Cassandra but I wanted to get my two cents out faster than I wanted to locate the darned post.

More later.

The Smoking Gun Is Petering Out

Founder
Other (or same) Founders posing (look, the woman has short hair!)

Is it possible that thesmokinggun.com, which sold its scenario of "World's Stupidest Criminals" to trutv (formerly Court TV of O.J. Simpson fame) writes stories that mock women who resemble Rachel Maddow? And therefore must be horribly stupid bank robbers who don't realize they have a GPS implanted in stolen money, they think it's a dye pack?

I must be dreaming. This is the site that gave us the fabulous Nick Nolte mug shot and other vital legal documents.

The Tactics of Cyberwarfare

A common tactic used to discredit political enemies (I've written about this before in Cassandra) is to mix the rebel up in a sex scandal. Sometimes scandal does exist factually and evidentially, as in the cases of David Vitter and Mark Foley. But other times the charges are murky.

The New York Times has an article on its front page (that's right, I'm an oldster, I subscribe to the print edition of the Times) which indicates that's what seems to have happened to Julian Assange, who was a former cyber hacker who founded an organization known as Wikileaks. Wikileaks has been brashly releasing evidence of such activities as pilots casually discussing the killing of civilians from a safe distance of 30,000 feet.

Some accuse young people of all techno, no causes. But in Assange's case, they seemed to have found a cause to rally around, his jailing. They are using their formidable weapons, their knowledge of how computers and the internet really work and intermingle, to disrupt some powerful corporate interests. This is also not a new activity. It's done by governments all over the world. So what exactly are they doing? In some cases they are bombarding the websites with coordinated messages simultaneously as to overwhelm the IP, which leads to a denial of service. No one can then access that website.

Some of these attacks, which appear to have no connection with Assange, are from a group that calls itself "Anonymous". To all you folks out there who get confused by a concept known as "irony", when a group pointedly calls itself "Anonymous", operates on the Internet which cloaks itself in anonymity but they themselves are operating in plain sight, that's irony. These guys are out on a limb ostensibly fighting for a cause they fervently believe in.

More later about the limits of privacy.

With Politics, There's Always Nasty Compromise

According to today's Wall Street Journal, there might be a light at the end of the tunnel for the middle class even in the midst of the unhappy compromising on the Bush tax cuts:

Th deal includes a 13-month extension of lapsed federal jobless benefits and a temporary cut in the worker's shaer of the Social Security payroll tax. It would extend a raft of other tax cuts aimed at middle-class tax payers, including a two-year program to shield most Americans from the Alternative Minimum Tax (AMT).

The price to be paid is huge: $700 billion in unfunded mandates for extending the Bush tax cuts set to expire at the end of the year. The prospect of passage has already pushed up U.S.borrowing costs which will greatly increase the budget deficit. A standard in credit determination, the yield on the 10-year treasury bond, has gone to 3.22%, the highest level since June 2010.

The Democrats are rightfully angry.

[They] want an extension of the Build America infrastructure bond program, but many lawmakers concede it might die due to Republican opposition. The bond program, set to expire at the same time as the Bush tax cuts, provides subsidies for taxable bonds issued by state and local government.

Who Has to Pay: Millionaires or the Unemployed?

Very interesting. Just read both the New York Times and the Wall Street Journal articles on Washington's big pow wow this weekend, which basically covered two fronts: 1) Extending the $700 billion tax cuts for all Americans, including the top 1% who are millionaires/billionaires; and 2) extending unemployment benefits for the rest of us.

Curiously, the Republicans insist that the $700 billion bite taken out of our Treasury doesn't need offsetting spending cuts (read: schools, highways, libraries, police, firemen, etc.) while unemployment benefits do need offsetting spending cuts.

Quoting the Senate Republican leader, Mitch McConnell, on "Meet the Press" yesterday:

[And] Mr. McConnell acknowledged that there would be a continuation of jobless aid for the long-term unemployed, though he reiterated the Republican contention that the cost should be offset with reductions in spending elsewhere.

"I think we will extend unemployment compensation," he said. "We've had some very vigorous debates in the Senate. Not about whether to do it but whether to pay for it as opposed to adding it to the deficit. All of those discussions are still under way."

My question to Mr. McConnell is, do you only care about the deficit in terms of the lower 99%? Who pays for the $700 billion? What offsets the cost of extending the Bush tax cuts?

Post Crisis: 3 Mavericks With New Ideas--Part II

As promised, here are the ideas of the 3 brave men attempting to wrestle with the post-crash economy.

Cast of Character: Physicist Doyne Farmer, who thinks we should analyze the economy like we do the weather and epidemics.
Psychoanalyst David Tuckett: The key to market gyrations is found in Freud (monsters from the id?)
Economist Roman Frydman thinks we can never forecast the economy with any accuracy.

Farmer doesn't see people as rational actors, and he definitely doesn't believe current models take into account (how did he put it?) "large chunks of reality." His solution is to create a more complex simulation of the economy like those used to model weather patterns, epidemics and traffic.

Of course, as we all know (those lovable weather people!) there's a large amount of failure built into those models as well. That doesn't make them unsuccessful. Look at baseball. To be a pro you only have to hit 3 times out of 10. Farmer's model would include actors who don't have to agree with one another and who don't act in predetermined ways.

Tuckett seeks to look inside the mind for answers. When I was a tot there was one thing I took to heart: the market is driven by greed and fear. That's plainly illustrated by the attitude toward credit pre- and post- housing crash. Before the crash, mortgage brokers gave money to anyone with a pulse. Afterwards, the money men pulled in their tents, cut credit lines to viable small businesses and in general acted like miserly, prudent schoolmarms.

Tuckett's research led him to believe that some financial instruments (credit default swaps?) "are so volatile and hard to value, they trigger humans' tendency to fantasize." In fantasy mode people will pay anything to acquire the magical powers they themselves have bestowed upon the object (Dutch tulips, potatoes that look like Richard Nixon)--also known in psychological circles as "projection". When the object loses value, people focus on its flaws.

Frydman, the economist, went his own way, butting heads against the idea that all buyers will act in the same way. As discussed in previous post, such logic makes for gorgeous, icy, inexorable mathematics, but it can also be severely misleading.

"Capitalism works better than other systems because it lets people disagree about the future and profit from their insghts. This is rational behavior that the models don't accommodate."

Perhaps the best thing is to recognize the limits of our knowledge. Even if we know a crash is coming, as people like Nouriel Roubini tried to warn, we don't know exactly when it will happen.

Frydman thinks the Central bank can play a huge role in signaling when asset classes like stocks, bonds (what's the par value on that thing?) or houses are getting overheated. No encouragement of irrational exuberance or promotion of adjustable rate mortgages, as previous Central bankers espoused. The idea is to warn buyers about risk so they can factor it into their decisions, thus not only arming the individual but help to prevent systemic failure.

According to the Journal, Maybe Economics Isn't So Dismal After All

Did you ever feel that a Corvette could chase the blues away? Mon dieu! The Wall Street Journal has actually begun exploring different theories of how the economy functions based on the concept that people are driven by emotion, especially when it comes to money.

Neo-classical belief which has been the prevailing theory for years, posits that people are rational actors and make stolid, price-based decisions on every purchase, which enables the markets to work smoothly. The beauty of this theory is that the workings of the economy can be reduced to the inexorable logic of mathematical equations. Very elegant. Not the real world.

Unfortunately, such logic did not work in terms of the ongoing housing crisis. Models were created by MIT PhD's best and brightest, but the data that girded these paradigms had cracked foundations. They had 20 years of housing data to work with, so they fed those 20 years into the gaping maw of their machines. Because housing prices did not fall during that time, the assumption of the model was the housing prices would NEVER fall. The beauty and comfort of mathematics smacked headlong into unforeseen events (which include many things too numerous to mention, like fraud, greed, lying and other criminal behavior).

After all, it's statistically impossible to feed every conceivable variable about thousands of mortgages that comprised one mortgage backed security. One person may pay his/her bills on time, the other may be on welfare, another is profligate (you get the picture).

So the Journal has given three economists who would be considered on the fringes a chance to explain their theories, which include real-life human behavior. I will take them up in another post.

Is Silicon Valley Headed For Dot-Com Bust 2.0?

On the front page left column above the fold article in the NYT today, "Silicon Valley Showing Signs of Bubble", the article questions whether all the venture capital money flowing to current Silicon Valley social network start ups will actually pan out in the long run, particularly in terms of the huge amounts they're investing in these entities. Some of the apps trade on exclusivity, almost like Studio 54, like Path, "an iPhone app for sharing only photos on a social network limited to only 50 people". Investors coughed up $2.5 million for that one.

The question becomes, will these young and hot entities go the way of early 21st century dot com busts like pets.com?

Are we seeing herd behavior again? People are afraid to "miss the next big thing". There are differences between 1.0 and 2.0. Most of the companies now are not traded on the stock exchange so there is no exchange bubble. Of course, that leads to questions of transparency and regulation in favor of investors.

But in this current environment, when money is hard to come by with ZIRP interest rates, cash is king. And some technology companies are sitting on a lot of cash.

[Microsoft, Apple or Google] have about $90 billion in case on their books. McKinsey & Company calculates that the largest software and hardware companies have enough excess cash on hand to buy nearly all of the tech industry's medium-sized companies.

The question in my mind is, how will these companies eke out profits? Will online advertising actually support these businesses in the long run?

Do Politicians Stand With Us or Against Us?

The top marginal tax rate during the Eisenhower years was 90%. No one can argue there wasn't prosperity then. But in the 1980s, President Reagan cut taxes to 25% and thus began the largest income inequality in American history, which persists to this day. In the face of crumbling cities and vanishing services, the Republicans want to continue this failed, destructive policy by extending the Bush tax cuts for millionaires and billionaires.

Reagan and his henchmen referred to the theory of giving the rich tax cuts as "trickle down" economics, also known as "piss on us" economics, which was discredited by none other than David Stockman, Reagan's Budget Chief at the time. The rich do not spend to create jobs. They invest and manage to pay 15% tax on their capital gains. Ordinary earned income is taxed at 35%.

It's simple in terms of numbers. The most stimulative program that puts money directly into the economy is unemployment insurance. Ordinary people must go out to buy food, shelter and other taxed consumables. In essence, the lower 99% often pay tax twice, on their income and on the products they purchase.

I see more jobs disappearing every day. In my neighborhood, there is a drug store chain that has replaced humans with "self check out" machines. This is the finest example of corporate thinking, to commodify everything and everyone.

Rachel Tells It Like It Is

Sorry for the quick study, but it's time to pay attention!

#1: Bush Tax Cut Love: Republicans want to add $700 bn to the budget deficit without figuring out how to pay for it by continuing the Bush tax cuts for the top 2% (millionaires and billionaires: read "Politicians and friends thereof").
#2: They don't care about middle class (or working class, or any other class) concerns, including health care, unemployment insurance, jobs or eating.
#3: They are not in the majority even though the Beltway media encourages that belief.
#4: The filibuster is anti-democratic and will erode the ability of the government to function, except to cut themselves and their friends paychecks.

Happy Thanksgiving! & Psycho Bitch Party

I had a strange dream tonight. I was in a place I’d been many times before, a place of comfort and respite where I could share common interests, but tonight it was very different.

Ground rules: Fair fight. Don't attack when you have the floor unless your opponent has the same privilege. Rope-a-dope. If you're trying to settle a score, let us in on it. And do your homework, goddamnit!

People read work that seemed to come out of their veins. One woman wrote a nasty piece on “shoving a straw up” something--Hey, I'm a native NYer, tell it like it is. At least come out and say it, “shove that straw up your c-word, you c-word, or up your ass, or whatever.” She alluded to all sorts of nasty things this “person” with the straw was attempting to do while using the “straw”.

She attributed the basest motives to the person with the straw, that she was using it to fend off “hatred of others” and other disquieting thoughts. Who knew a straw could be so powerful? What makes it so frightening? What does it symbolize? She also casually mentioned lobotomies, shock treatments and other frightening activities used against the helpless.

Another woman started her reading by remarking how she was “guarding the hallway because people were having trouble coming back from the bathroom”. She did a piece on Mr. Peanut, saying “Mr. Peanut this, and Mr. Peanut that.”

At one point, she mentioned John Lennon. Okay, you don’t have to hit me over the head with this sh*t. (Actually, you do, because I don’t understand the thinking behind it. Mr. Peanut is not a real person. It is a brand logo. John Lennon was a formative musician and rebel under FBI surveillance who was assassinated.) Perhaps she saw the Parallax View montage I did and was mocking it, making everything equivalent—Mr. Peanut to me, Mr. Peanut to you, John Lennon to all of us. I don’t know how John would have felt, but I was offended.

And by the way, no one has told me they've seen anything related to what I was experiencing. If they have, please clue me in. I may be crazy, but I want to have fun, too!

I wish someone would tell me when I can wake up.

Monsters from the Id

In the 1956 movie Forbidden Planet, an American space search team headed up by a strapping, robust Leslie Nielsen landed on the remote planet Altair-4 to find out what happened to the people sent to colonize the planet several years before.

They ran into Morbius (Walter Pidgeon), who, along with his daughter, a scantily clad Ann Francis (to quote one of the men who'd been out in space a long time--"Oh, brother!"), were the sole survivors of the party. Everyone else had been torn to pieces practically overnight by some undetermined entity.

As Nielsen and his crack team of astronauts tried to pry answers out of the reluctant Morbius, who wanted them to get the hell out of there, they found out about the Krell.

The Krell was the Altair-4 civilization from thousands of years ago who had advanced way beyond us. They, too, vanished without a trace in a single night. They left behind some artifacts, including a self-generating source of energy (like a mini-sun). But (to quote the doctor in the plot) they forgot one thing. Monsters from the Id.

You may well ask, what the hell is the Id? The id is the third level of Freud's tripartite which includes the superego and the ego. It is the unconscious. It's the primitive instincts that seek to consume and will do so unless repressed. The id consists of energy that can explode or be directed in many ways. The libido, or the sexual instinct, is the most powerful. It demands fulfillment. And if you forget about it, you can be torn apart. By yourself!

The id is at work in the anonymity of the internet and the unchecked aggression of right wing media. You can see its unrepressed form in the false narratives about race, where the New Black Panthers are offered up as objects to fear. They are not the ones carrying unconcealed weapons into Starbucks. Or the imposed history that the Civil War had nothing to do with slavery or the demand that Anita Hill, a courageous lawyer daring to confront one of the powerful men in the world, apologize to his wife, the head of a very powerful conservative lobbying force.

This is the American Id split wide open, unrestrained, angry that the president is a black man who rose by dint of merit to the top of the American political system. It will do almost anything to obliterate that fact.

President Obama's spectacular achievement collides with the "wisdom of the crowd" so highly touted by Silicon Valley gurus and the ideology of the Internet. It gives the lie to the notion that expertise is elitist.

Perhaps in the world of computing, many computers working together produce a more powerful result. Certainly the supercomputers of Goldman and those that can afford them give a nano-glimpse of market movements sufficient to drive the market, or crash it. Computations happen at a much more rapid pace than human decision making. But speed shouldn't be the overriding concern.

Unless the id is repressed somehow, or held in check, we will be destroyed just as the Krell was. Our civilization will become degraded and the notion of progress will dry up like autumn leaves.

The Sh*t's Hitting the Fan, and No One Has A Clue

If you're curious as to why the U.S. economy continues on its disastrous course, all you have to do is peruse the ($2 in NYC) print edition of the NY Times. I like print because I can write on it, mash it into a ball and throw it right between the eyes like Ron Guidry used to. Also, origami.

The Fed is adding more paper to the money supply as it sold $600 billion worth of Full Faith and Credit. Unfortunately, instead of driving down the yield of the 20-year bond, the face value did a predator drone nose dive driving yield up. Everyone's scratching their heads and thinking/saying, "Huh?" Is it the uncertainty of what will happen after the Bush tax cuts expire? Is it Bush's face flogging his new book? Is it currency manipulation designed to drive down the cost of exports? Then you go to another story which explains that even with a weak dollar, fewer American jobs will be created because operations have moved overseas where the money is.

Perhaps the truth lies in the front page left column story where the entire Eurozone is in crisis mode You see, children, Eurozone countries, disparate though they might be, must keep their budget deficit at a certain percentage, which means pain and misery (aka "commitment to austerity"). Unfortunately, there comes a point at which dog food cannot sustain the population. For instance:

Of paramount concern to policy makers in Europe is Spain, which is struggling to close its own deficit of 9% of GDP at a time when unemployment is more than 20% and the economy is failing to grow.

Worries about the banks [in Spain] have peaked recently in light of data showing that distressed [read: will not be paid back] loans are now 5.6% of total Spanish bank loans--the highest level since 1996.

"This policy of saving banks at the cost of breaking the back of entire countries is a disaster," said Daniel Gros, direcor for the Center for European Policy Studies in Brussels.

As long as housing prices continue to fall, [losses] cannot be capped.

Our money is based on the sustained belief that horrible, worthless loans are actually worth something (mark-to market accounting) as opposed to fair value accounting (what bankers say their loans, and bottom line, is worth). The Fed transferred those failed mortgages for liquidity to the bankers. Not solvency, liquidity. No one is getting a hair cut except the foreclosed . Thank God the big banks figured out they could shovel the problem of lack of documentation, robo-signers, no ownership paper trail etc. into a huge PR push:

[In preparation for Congressional testimony about the fact that about 4 million families still face foreclosure], Barbara J. Desoer, president of the Bank of America Home loan...plans to apologize for shortcomings in the foreclosure process, while reiterating her defense that no foreclosure or eviction was pursued by mistake.

For the first time, Ms. Desoer also plans to highlight Bank of America's role as a servicer in most cases, rather than the investor that actually owns the mortgages.

David Lowman, chief executive of Chase Home Lending, is also scheduled to testify and adopt an apologetic stance.

RE: Monetizing the Messiah

See, children, to make money off something sacred because it's free is a shanda. A very big one. If these people don't believe in hell, there's fire below for them right now. If you've ever been a waiter, or a wedding photographer, you know what I mean. Everything for the princess with the golden you-know-what who wrinkles up her nose and won't touch "it"--eww, that's icky! Well, you guys are itching for such an Old Testament righteous beatdown. Keep it up. Keep us all beggars because that is the ONLY way you can feel elevated.

In other words, these people have nothing of value to offer so they have to strip everyone else of everything, especially their dignity and pride. It gives them some sort of sadistic joy. I never understood that. Maybe because I had to remember some very very bad things done to me in order to be the warrior I need to be for the mission. It's not that they're cheap; they LIKE to make you beg.

Monetizing the Messiah

So, I'm skipping through Central Park today, nice day, wouldn't you agree? Peaceful, sweet, came back to NY to cleanse the temple, burn it to the ground, and what happens? Screeching giant trucks pull up with Parks Department workers obviously given orders to sell swill to the tourists gathering to catch a glimpse of the latest "free" craze. Hey, once a Jew, always a Jew. Bernie Madoff, I died for your sins.

Rally To Restore Sanity

I notice all the beautiful people springing up around me. Let's spread some of that sweet power across the country and march golden and beautiful into the future. See you at the rally on Saturday.

Why Things Suck/Fight the Power Burlesque Tour

FIGHT THE POWER

SAVE YOUR MONEY
DON’T USE CREDIT CARDS
SEE THROUGH THE LIES
THERE IS NO FREE LUNCH FOR THE LOWER 99%, ONLY THE UPPER 1%

[The first in a series of educational entertainments.]

Why aren’t things getting better? Well, they aren’t going to, unless you ignore all the noise and distraction of the Internet, which only exists to extract and collect all your personal information including your social security number and your search key words in order to sell them to something else, either a corporation or a government. Everything else on it is designed to distract you

All the power and money in America is concentrated in the dark recesses of sociopathic Alpha male Ponzi schemers and their enablers who look at everyone else as suckers, including their shareholders and investors. They freely use company money to pay for cocaine and hookers and mask such activities with invoices marked “market analysis”. Then they go home to wife and kiddies in their gated McMansion communities. (See Charles Ferguson's documentary "Inside Job" for cleavage shots.)

So what happened, you may be wondering as you sit in your kitchen table surrounded by 2nd notices from loan companies, getting calls from “collectors” telling you they’re sending a sheriff to serve process, worrying about your medical bills, worrying if you’ll ever get another job, wondering if you too will be homeless. What the f**k is going on?

It was a gigantic Ponzi scheme that had a lot of elements to it. I don’t want to confuse you with the details. It’s mainly about people betting huge amounts of money putting very little down, then when the scheme collapsed, having someone else pay their bets. AKA privatized profits, socialized losses. And business is continuing as usual. It will get worse. The November elections will usher in more people spouting the lie of “free market” and “less government”. Those are just code words.

The way to understand the heart of darkness of the Wall Street beast is to realize that:

• It is not regulated
• People get paid up front for making deals, not for how the deals unwind.
• People are motivated by the sizes of their bonuses. In January 2011, Wall Street will pay out a record $144 billion in bonuses (WSJ 10/11/10)

It’s how these alphas know they’re on top. All other concerns: moral, ethical, legal, humanitarian, fall by the wayside.

What gives me the right to say these things? I am the product of wasteful government spending. I went to public school all the way up the line, proudly graduating with an honors BA from SUNY. I did err in going to a private law school but I made up for that by dropping out after a year.

The American government under the rule of law should exist to help the people. There is no other reason for it to exist. It should not serve as a way to transfer public money to private interests.

I’ll give you an example. Maybe you heard about some sort of mess about legal problems with mortgage foreclosures. I won’t get into it but suffice it to say that there was a great deal of criminal activity on the part of the Ponzi schemers, the people who got you to sign off on a mortgage you didn’t understand because they got paid more for a bad mortgage.

They didn’t keep the mortgage; they turned around and sold it to a bank. The banks took your mortgage and combined it with millions of others then put them through a sausage grinding machine called “securitization”. (Don’t pay attention to the bullsh*t terminology. Just remember, they’re lying to you.) Afterwards, they sliced up the sausage into little pieces and called each piece a “bond”. Just as though it were good ole U.S. Savings Bonds, the kind your grandmother gave you for your birthday. Are you saying there’s something wrong with my grandma?

The banks paid ratings agencies like Moody’s and Standard & Poor’s to slap on a Good Housekeeping Seal of Approval, a triple-A rating. Without that rating, you see, they couldn’t sell this phony product to the biggest cash cows of all, gigantic state pension funds like CALPERS. Pension funds cannot by law buy any investment with less than a triple-A rating.

So the Wall Street c**ks**kers paid their lackeys at the ratings agencies for that seal of approval which should have been a skull and crossbones warning label instead. They sold trillions of dollars worth of these mortgage-backed securities that way, taking a cut each time. Everyone in this daisy chain got a cut.

It was quite a machine, this sausage machine. Lenders offered potential homeowners the WORST mortgages, subprime, even if the homeowner qualified for a prime. The lender was paid more because the bond that came out of it paid more interest to its investors (its investors being the unwitting pension funds—your retirement money—buying worthless product. That makes it a PONZI scheme). Am I losing you? Hope not.

Did you know on Wall Street that it’s possible to bet on things you don’t own with no money down? Let me draw you a picture. It’s as though someone can buy fire insurance on your home without owning it and without telling you. You’re pretty happy until one day you drive home and your house is burning down. Everything you ever owned was in that house. You insured it, sure, you can rebuild, but can that make up for the calamity?

Meanwhile, up in the gated community, another person who also insured your house is sitting in his McMansion with original Van Gogh and Picasso on his walls and Cathedral ceilings with stained glass windows holding the wad of cash from your burned down home in his hand. He’s contemplating what to use it for. Should a small part of it go for the $50,000 a year exclusive 92nd Street Y pre-K he pulled strings to get Brittany into? Or should he hire a new wine steward for his place in Tortuga? He may even have hired an arsonist to burn down your house. You are of no consequence.

First in a series by http://whereiscassandra.blogspot.com

Wednesday, October 20, 2010

Hatred in America: Muslims are the New Jews

This country is headed down an ominous path. Contrast two stories in the NYT yesterday which showed the chilling effect of what happens when a country decides people who practice a certain religion are a cancer that must be cut out of the body politic.

One article told the story of German child psychiatrist Hans Keilson, a Jew who fled Germany in 1936 after his first novel was banned by the Nazis. He had watched the brownshirts grow in power but never thought he'd be a target:

"I was so German," he said. "I thought they would not do this to me. I am one of them." But he soon realized that Germans no longer recognized him as part of themselves. He remembered a literature class in which he read a poem by Heinrich Heine, who was born Jewish. The class president stood up and said: "We refused to talk about this. This is not a German poem."

The same tactics and even the same language are being used against Americans who practice Islam. People have been worshipping at a tiny mosque in upstate New York for the last 30 years. It's housed unobtrusively in a plain, unadorned building. Recently a pack of teenagers tried to hit the son of one of the mosque's founding members. One of them fired a shotgun in the air. A few days before that, he'd driven by shouting anti-Muslim epithets.

The ancient (but still invoked) charge of blood libel, the belief by Christians that Jews drain the blood of Christian children for their religious rituals, was echoed by this teen's words. He heard it was a cult house where people drank blood. He added as justification, "How many real religious places do you see that do not have a sign stating that it's a religious place?"

Right now it's mainstream discourse in America to question whether a citizen practicing a certain religion is a loyal American. In fact, the atmosphere is poisonous with accusations that we have terrorists within our midst (especially the President) with a secret agenda to take over.

This is not new in our history. Senator Joseph McCarthy made his bones on accusations that the American government was infiltrated by American communists. JFK had to contend with accusations that his loyalty was to the Pope in Rome. (Ironically, Kennedy was one of the few Democrats who never denounced McCarthy. McCarthy was also a Catholic and extremely influential.)

The amount of hatred and vituperation against Muslim Americans is reminiscent of Dr. Keilson's story. The desire to cleanse America of a foreign toxin in order to purify it has echoes in the darkest times of civilized society.

Unless we have some pushback from powerful voices, this unchecked aggression will destroy people. The hordes will pour forth strippping the flesh from the bones of what's left of the rule of law. How can such ignorant hatred drive American policy without being called out?

"Have you no sense of decency? Have you left no sense of decency?"--U.S. Army's chief legal counsel Joseph Welch to Senator Joseph McCarthy

Burn, Baby, Burn--Who's Next?

Pastor Terry Jones of Gainesville, Florida plans to publicly burn the Koran on the ninth anniversary of the 9/11 tragedy. Even Fox News thinks that's a bad idea.

As the Reverend John Rankin writes:

[Jones] admitted to the New York Times in an August 26 article that he has no knowledge of the Koran: “I have no experience with it whatsoever. I only know what the Bible says.” As well, in my direct contacts with his church, I have learned that he claims God told him “to do this burning.”

Really? How well does he know the Bible? Is it biblical to be deliberately ignorant concerning a matter about which you write a book? Is he claiming to be a prophet, and if so, what will the results show?

This man will burn the sacred book of the third branch of the Abrahamic religion and upload it for all to see. The word of the prophet Muhammad, just as the Bible is the word of the prophet Jesus. Abraham was the father of Isaac and Ishmael. Moses is there. Mary is there.

All these shouters are so proud of their ignorance and proud to provoke civil disorder, unrest and murder with the click of a mouse.

Where were they when Timothy McVeigh blew up the Oklahoma City Federal Building, killing 168 people? Oh, I forgot. They CELEBRATED his bombing on April 19, the anniversary of this American terrorist.

If you are sincerely interested in understanding Americans who practice Islam, check out this video . It's the Congressional Muslim Staff panel discussion on the Image of Muslims in America.

By the way, isn't Terry Jones an original member of Monty Python?



He's the judge here, too. Check out Cardinal Richilieu.

Glenn Beck's Glasses Lead the Nation...

unless you, my progressive and/or Democratic compatriots, vote.

Ah, the run-up to the midterms! Fall is in the air. That means time to exploit 9/11 for political opportunity! Blame Obama and march to victory!

Overthrowing the government is good. But remember to propagandize correctly. "Take back the country!" "Patriot points"!

Hold a mass meeting at the Lincoln Memorial on 8/28, the same place and day as Martin Luther King when he gave his "I have a dream" speech, then deny disingenuously that you are doing that. If someone happens to mention that fact, say, "THEY are accusing me of stealing the date. How dare they?" Who are THEY? Subtext subtext subtext.

Ooo, the tea party. They hang on Sarah Palin's every tweet. Those tweets, they sure are perky and ample. Appeal the 14th amendment. Hell, appeal the Civil Rights Act. However, thank God it was fought for with blood, sweat and tears in the first place. Otherwise Glenn Beck couldn't usurp the symbolic importance of MLK and present himself as the strong man leader of the aggrieved white people who respond to his dog whistle methods and think of themselves as "slaves" to Obama's "plantation owner" strategies.

This is the grass roots party that's created and financed by the fossil fuel/chemical billionaire Koch brothers. And their agenda is not populist. In the August 30, 2010 article in the New Yorker, Jane Mayer , one of the best investigative reporters left, spells it out:

With his brother Charles, who is seventy-four, David Koch owns virtually all of Koch Industries, a conglomerate, headquartered in Wichita, Kansas, whose annual revenues are estimated to be a hundred billion dollars. The company has grown spectacularly since their father, Fred, died, in 1967, and the brothers took charge.

The Kochs operate oil refineries in Alaska, Texas, and Minnesota, and control some four thousand miles of pipeline. Koch Industries owns Brawny paper towels, Dixie cups, Georgia-Pacific lumber, Stainmaster carpet, and Lycra, among other products. Forbes ranks it as the second-largest private company in the country, after Cargill, and its consistent profitability has made David and Charles Koch—who, years ago, bought out two other brothers—among the richest men in America. Their combined fortune of thirty-five billion dollars is exceeded only by those of Bill Gates and Warren Buffett.

The Kochs are longtime libertarians who believe in drastically lower personal and corporate taxes, minimal social services for the needy, and much less oversight of industry—especially environmental regulation. These views dovetail with the brothers’ corporate interests. In a study released this spring, the University of Massachusetts at Amherst’s Political Economy Research Institute named Koch Industries one of the top ten air polluters in the United States.

Maybe you're disappointed in Obama. Maybe he's a captive of corporate interests. But VOTE anyway, you goddamned Democrats. I didn't want Obama. But I voted for him anyway.

As the angry Republicans eagerly vote out the incumbents, remember who their puppetmasters are. And they are much, much worse.

Take the Despotism Quiz! Winner Take All!

Because something is happening here
And you don't know what it is
Do you, Mr. Jones?

Mo Dowd is Blowing Toxic Smoke in DC Bubble

Sultry, Pulitzer Prize-winning Clinton basher Maureen Dowd spreads more manure for the Obama Administration, ladling it all over Obama's base. She reiterates Press Secretary Robert Gibbs' contention that there are 3 types of "liberals": professionals, good liberals that:

[L]ike the president, felt he could live without the public option, whereas lefties thought the public option was essential. Some liberals, like the president, think you can escalate our wars to end them, whereas lefties just want the wars ended.

I guess in the mind of the Washington elite who don't sound like they get out of the Beltway, lefties are bomb-throwing anarchists that want Canadian (gasp!) health insurance, the Pentagon to evaporate, and "wouldn't be satisfied if Dennis Kucinich was president."

She must be talking about cartoon lefties with black berets and goatees. The people she and the pathetic Obama/Gibbs machine lump together are realists AND care about humans, not paying back campaign funders. We wanted Obama to listen to us, not just Fox News (e.g. ACORN, Van Jones, Shirley Sherrod). Not to make secret deals with Big Pharma, or dismiss out of hand Medicare-for-all.

Or continue the policy of free money to Big Banks, which turn around and feed the carry trade instead of lending to small businesses. Or allow foreclosures to multiply by not fighting for bankruptcy judges for homeowners. Or to pretend to support a public option or Elizabeth Warren, the architect of the part of the financial bill that protects consumers as opposed to whom he will actually pick, a lobbyist for the financial industry. Ask yourself, Mo, if you'd want an executive from Dow Chemicals to regulate the Clean Water Act.

We wanted a stimulus that wasn't 1/3 tax cuts for the rich. We wanted trickle-up, not trickle-down.

He doesn't restore habeas corpus, which isn't a radical concept. As a constitutional lawyer, he should know that habeas corpus is the foundation of human liberty against arbitrary state power. It's in the Magna Carta, 1215 A.D. He continues and expands the surveillance state.

In her petty snit she even calls out (what is it, liberals, lefties, progressives or professional liberals?) for defending Clinton despite his disgustingness. Well, if he was so bad, why did Obama latch onto his Wall Street dons, Larry Summers and Tim Geithner? I don't remember Clinton acting as though 10% official unemployment was the "new normal" (most economists, conservative or on the left bank, agree that unemployment is actually much higher than that because the figures are calculated with a political slant).

I don't know what kind of health insurance Dowd has, but mine (and damn I'm lucky) has co-pays averaging $130 a month for necessary prescription drugs, and I don't even take very many.

Cut Everything But Child Pornography

Deficit hawks rule. Gotta cut the budget. No social services, no mass transit, no civil servants, no teachers, firemen, policemen, sanitation workers, safety net, nada. However, never cut the Pentagon budget!

Especially when it comes to the ability for military officials and defense contractors to download child pornography. Somewhere, somehow, children are getting educated but maybe not the way we want them to be.

The Midnight Sun--Twilight Zone--it's not hot, it's only in your mind...

It's hot...or is it? Midnight Sun--Twilight Zone (1960)

The Internet Makes You Stupider

According to recent studies, users of the Internet don’t attain the knowledge of billions through the giant brain of cloud computing. It seems to make people lazier, more stupid and destroy their ability to think and write critically and analytically.

Two recent columns in the NYT discuss the dumbing down effect of the internet. One was David Brooks’ recent column. He wrote about a 3-year study done by researchers from the University of Tennessee. They allowed 852 disadvantaged students to take 12 books of their own choosing home for the summer to read. And they read them! The students’ test scores in reading were not only significantly higher than comparable students who hadn’t participated. They learned as much as they would have in summer school.

But the students given a computer and access to the Internet did not fare so well:

Recently, Internet mavens got some bad news. Jacob Vigdor and Helen Ladd of Duke’s Sanford School of Public Policy examined computer use among a half-million 5th through 8th graders in North Carolina. They found that the spread of home computers and high-speed Internet access was associated with significant declines in math and reading scores.

In Brent Staples’ article about students’ cut-and-paste culture, teachers not only have become plagiarism cops, they also fret about the kids losing the ability to think in any but the most superficial way:

[A]s David Pritchard, a physics professor at the Massachusetts Institute of Technology, told [Staples] recently: “The big sleeping dog here is not the moral issue. The problem is that kids don’t learn if they don’t do the work.”

Prof. Pritchard and his colleagues illustrated the point in a study of cheating behavior by M.I.T. students who used an online system to complete homework. The students who were found to have copied the most answers from others started out with the same math and physics skills as their harder-working classmates. But by skipping the actual work in homework, they fell behind in understanding and became significantly more likely to fail.

This is M.I.T.! And the students aren’t remorseful. They grew up in a cut-and-paste culture, where putting together the bits you find on the net is the same as staking a position and writing a sustained, thoughtful argument. Believe me when I say I don’t understand half of the comments on many blogs. Not because there’s a generation gap. There’s a semantic, linguistic and contextual gap. Oftentimes I wonder, “What the f#@k do they mean?”

Hey, I like cutting and pasting, too. Finding primary sources and quotes on the net (as I did for this article) is a lot easier than combing through yellowed newspapers and randomly organized books and manila folders. (I’m describing my workspace.) But I don’t like my attenuated attention span, dumbed down to fit the frenzied, pop culture nature of the Internet. I have to write for the page view eyeballs. No Proust allowed.

As a sometime SAT/GRE/GMAT/LSAT tutor, it's amazing how many people can't pay attention for the length of time it takes to read a 1500 word essay, let alone write one. That's good for my side business, but bad for the world. Ain't gonna change, anyhow. Now we're biologically wired to get that dopamine rush in 15-second, 140 character spurts. Don't bode well 'tall.

UNEMPLOYMENT INSURANCE CAUSES UNEMPLOYMENT--NEW RIGHT PROPAGANDA

People wonder (not just me) how the deficit hawks took control of the narrative despite historical evidence (1937 dip), reasoned shouting from esteemed Nobel-prize winning economists and millions out of work for months or years, with no end in sight. Now there's a new talking point which may give the government cover to discontinue unemployment benefits. Never mind the human cost (who cares about that in Washington)? Unemployment insurance is proven to grease the economy because the money flows immediately into the economy.

A close examination of the Wall Street Journal’s article on the front page of yesterday’s edition, “Long Recession Ignites Debate on Job Benefits” shows how talking point propaganda spreads through an ostensibly objective news article. Rupert Murdoch spreads this through the vehicles he owns (the Wall Street Journal, Barron's, Investors Business Daily, Dow Jones, New York Post, Fox News, Glenn Beck, Sarah Palin, etc., etc.).

It’s tricky to write such an article in a time of unprecedented long-term unemployment and permanent business constriction but the Journal always finds a way. In this post, I am bolding the sentences that contradicts the paragraph lead before it to show the logistics of building propaganda through the media.

The article leads with people turning their noses up at jobs because unemployment pays so well:

Management Recruiters of Sacramento, Calif., says it recently had a tough time filling six engineering positions at an Oregon manufacturer paying $60,000 a year—and suspects long-term jobless benefits were part of the hitch.

"We called several engineers that were unemployed," says Karl Dinse, a managing partner at the recruiting firm. "They said, nah, you know, if it were paying $80,000 I'd think about it." Some candidates suggested he call them back when their benefits were scheduled to run out, he says.

Further into the story, the first sentence of a paragraph mentions that “the government expanded unemployment payments more than at any time since the benefits were rolled out in the 1930s.” Then the writer mumbles the sentence, “And workers have gone jobless for longer than any time since official tallies began in 1967.”

You see the pattern? On an article that mentions that unemployment is unprecedented and unemployment insurance is one of the best ways to keep the economy afloat in a bad and sinking economy, the arrangement of semi-facts makes the reader believe that big government and its lavish payouts are stalling the economy.

Here’s another example of strategic placement and fact-tweaking:

A variety of studies suggest that adding another 53 weeks of benefits increases the time the average worker is jobless by between 4.2 and 10.6 weeks. The higher estimates are based on studies conducted decades ago when layoffs were often temporary; in this recession, many unemployed workers will never return to their old positions.

The lead sentence always proclaims that unemployment benefits are found to lengthen unemployment. Then the author sneaks in a disclaimer that disproves the party line.

The article even cites Lawrence Summer’s words from 1993 (during the Clinton era, when jobs were plentiful) that:

"[G]overnment assistance programs contribute to long-term unemployment...by providing an incentive, and the means, not to work." When an April Wall Street Journal editorial described his position, Mr. Summers (now Obama’s economic advisor) fired back in a letter to the editor: "In the wake of the worst economic crisis in eight decades...there can be no doubt that the overwhelming cause of unemployment is economic distress, not the existence of unemployment insurance."

Disclosure: I do not agree with Summer’s policies, particularly his position on infrastructure building during the creation of the stimulus nor his torpedoing of derivatives regulation.

In order for the Dems to fight this propaganda, they have to meet it forcefully with counter-propaganda. Call it the surge. Reverse the sentences in a story. Better yet, leave out the first sentence. How hard is that?

Who Are the Enemies of the State?

What about them Russian spies living under "Deep Cover" in the U.S.? Here with their anti-capitalist propaganda?

One of the spies was quoted in the first paragraph of the Wall Street Journal article on her treacherous ideology:

"The essence of capitalism is exploitation and permanent expansion to ensure profit growth and the power of mega-corporations…," Ms. Pelaez, a native of Peru, wrote in a 2007 column for El Diario La Prensa, a Spanish-language daily.

As we learned over the last 3 years (and counting), capitalism is the bestest! Particularly the form as practiced and exported in America, predatory capitalism, where a few monolithic financial firms (Citigroup, Morgan Stanley, Bank of America, JP Morgan Chase, Wells Fargo and Goldman Sachs) make extremely risky bets in DEEP COVER with no ability to pay if the bets go bad.

Some (Goldman Sachs, et al) of them even insure against the lousy bets and shake down the insurer (AIG) with aggressive collateral calls unmatched by any other AIG counterparty. Sometimes it even deliberately structures the bet in a lousy fashion and insures against default. Why not? It only has to put down a minuscule amount to hit big.

The government bailed out(and will continue to bail out: see Financial Reform Bill) these "Too Big To Fail" banks (what is that, a get out of jail free card?), asking nothing in return and offering the taxpayers the fiction that the banks will unfreeze credit and lend money to small companies and individuals again. But they don't.

Trillions pour from government coffers to these bank vaults and the execs skim both ways. They can't lose! And some financial firms have too much money:

Use it or lose it. That is the choice faced by some buyout firms sitting on piles of capital they have raised but not invested. The firms are unlikely to give it up without a fight.

A fund-raising arms race last decade was followed by a sharp slowdown in investments, leading levels of dry powder to surge. Such undeployed capital stood at a record $280 billion among U.S.-focused buyout firms at the end of 2009, according to research firm Preqin.

Once the oligarchs get theirs, the propaganda begins.

Teachers are overpaid and absent. Public employees are ripping us off. Why should they get pensions and not us? The top 1% stands back in amusement and watch the rest of us fight for the crumbs on the bottom.

During a time of record-high long-term unemployment and little hope for the future, the talk turns to deficit fears. Gotta cut the debt. Raise taxes and cut spending. So taxes are raised, regressively. On cigarettes and booze, never those making $1+ million. Do you think a millionaire gives a damn if the cost of his cigarettes goes up $3 a pack? He's lighting his Cubans with $100 bills.

Another way to look at it: Black & Platinum lottery cards for the poor and newly poor. Black & Platinum credit cards for the rich.

And people are dying:

FORT LAUDERDALE, Fla. — The weak economy is crippling the government program that provides life-sustaining antiretroviral drugs to people with H.I.V. or AIDS who cannot afford them. Nearly 1,800 have been relegated to rapidly expanding waiting lists that less than three years ago had dwindled to zero.

So I ask you again, who or what is destroying the social contract? Are we a government by the people and for the people?