While Bush takes a last swipe at labor in his proposal to bailout GM and Chrysler, there are signs of a change in the climate for workers.
For several decades
* Working people have been treated like enemies, a class to be preyed upon.
* Labor unions were ferociously attacked.
* Jobs were shipped overseas by the millions.
* People were hired as temps or consultants so benefits could be denied.
In the words of Leo Gerard, president of the steelworkers union: “Washington will bail out those who shower before work, but not those who shower afterwards.”
Promising developments
A labor secretary, Hilda Solis, who is pro-labor: she “is pro-worker to her core, a politician who knows what it’s like to walk a picket line”.
More than 200 laid-off workers staged a successful six-day sit-in at a factory in Chicago, demanding and eventually getting severance pay and benefits that they were owed by law.
In Tar Heel, N.C., last week workers, after a brutal 15-year struggle, succeeded in organizing the notorious Smithfield Packing slaughterhouse, the largest hog-killing and processing plant in the world.
From Bob Herbert
Saturday, December 20, 2008
Obama Watch - the stimulus plan
Stimulus plan to be ready to sign after the inauguration - maybe.
From the NYT 12/20/08, expect to see some of this included.
It will be for about $1 trillion for a two-year program. Only items that "spend out quickly, create jobs and constitute sound national policy" will be considered.
The plan will involve these areas:
1. health care financing: about a fifth of the package
• Up to $100 billion to subsidize the states’ Medicaid caseloads
• a down payment on the $50 billion to help medical providers buy information technology and save costs on health records. {Not the most progressive answer to cutting health care costs - wonder who he owes this to?}
2. Tax relief: roughly $200 billion in tax relief for low-wage and middle-class workers, including a payroll tax holiday to "fatten paychecks and encourage Americans to spend more and spur economic activity". {We are to go back to buying in order to save the economy?}
3. Energy-saving programs
4. Public works projects, school construction and renovation,
5. Expanded jobless aid and food stamps
From the NYT 12/20/08, expect to see some of this included.
It will be for about $1 trillion for a two-year program. Only items that "spend out quickly, create jobs and constitute sound national policy" will be considered.
The plan will involve these areas:
1. health care financing: about a fifth of the package
• Up to $100 billion to subsidize the states’ Medicaid caseloads
• a down payment on the $50 billion to help medical providers buy information technology and save costs on health records. {Not the most progressive answer to cutting health care costs - wonder who he owes this to?}
2. Tax relief: roughly $200 billion in tax relief for low-wage and middle-class workers, including a payroll tax holiday to "fatten paychecks and encourage Americans to spend more and spur economic activity". {We are to go back to buying in order to save the economy?}
3. Energy-saving programs
4. Public works projects, school construction and renovation,
5. Expanded jobless aid and food stamps
Thursday, December 11, 2008
Myth-building on housing crisis
The Republicans are well on the way to a rewrite of history on what caused the housing crisis.
Case in point: Housing Goals We Can’t Afford by HOWARD HUSOCK
He writes: "The Community Reinvestment Act was passed in 1977 when bank competition was sharply limited by law and lenders had little incentive to seek out business in lower-income neighborhoods. But in 1995 the Clinton administration added tough new regulations. The federal government required banks that wanted “outstanding” ratings under the act to demonstrate, numerically, that they were lending both in poor neighborhoods and to lower-income households."
Hmm. The way I understood it was that the CRA forced banks to stop discriminating and redlining.
Case in point: Housing Goals We Can’t Afford by HOWARD HUSOCK
He writes: "The Community Reinvestment Act was passed in 1977 when bank competition was sharply limited by law and lenders had little incentive to seek out business in lower-income neighborhoods. But in 1995 the Clinton administration added tough new regulations. The federal government required banks that wanted “outstanding” ratings under the act to demonstrate, numerically, that they were lending both in poor neighborhoods and to lower-income households."
Hmm. The way I understood it was that the CRA forced banks to stop discriminating and redlining.
Wednesday, December 10, 2008
How much are Auto CEO's offering to give up? Not Much!
In order to get their billions from the US taxpayer, The Big Three CEOs and in some cases the Directors, are offering to reduce their 2009 salaries to $1. To find out how much this would actually cost them, I did a little research.
What is the compensation for auto industry executives?
In 2006, the CEOs of Chrysler Group, Ford and GM earned a combined total of $24.5 million in salaries, bonuses and other compensation in 2006. The next four highest paid executives received average salary and other compensation of $1.3 million at Ford and $1.4 million at GM.
Looks like they will lose a few million each. But, are they planning to forego all compensation except $1, or only salary? Or salary and bonuses? What about stocks and stock options that were also part of executive compensation, which were not included in the figures above.
We can see more clearly what else they might give up in these figures for Ford’s top 5 employees, from Ford’s Annual Report for 2007.
• Alan Mulally, Ford president and chief executive officer, earned $2,000,000 in salary and received incentive bonus awards of $7 million. His total 2007 compensation was $21,670,674, which includes salary, bonuses, the Company-recognized expense for stock options and other stock-based awards, as well as all other compensation. His salary, in other words, was a mere 9.23% of his total compensation.
• Don Leclair, Ford executive vice president and chief financial officer, earned $1,005,633 in salary and received incentive bonus awards of $3 million. His 2007 compensation totaled $11,703,127. (Salary was 8.6%)
• Mark Fields, Ford executive vice president and president, The Americas, earned $1,255,634 in salary and received incentive bonus awards of $2,850,000. His 2007 compensation totaled $8,389,898. (15%)
• Lewis Booth, Ford executive vice president, Ford of Europe and Premier Automotive Group, earned $868,133 in salary and received incentive bonus awards of $2,250,000. His 2007 compensation totaled $10,264,463. (8.46%)
• Mike Bannister, Ford executive vice president and CEO, Ford Motor Credit Company earned $708,700 in salary and received incentive bonus awards of $2,150,000. His 2007 compensation totaled $8,677,747. (8.17%)
In other words in 2007, while salary and bonuses were approximately $6 million dollars, this represented only 8-15% of the total compensation they received for their year’s efforts. These top 5 Ford employees actually received approximately $60.72 million in total compensation. For the same period GM’s top 2 earned $15.7 million for 2007, up 64 percent from the previous year, (while GM lost a record $38.7 billion). Because Chrysler is privately owned it does not have to publish this information - but I imagine the figures are much the same.
How much of this total compensation are the CEO’s offering to give up? That is not clear!
Just for comparison, what else could these dollars cover?
If you divided the $60.72 million compensation paid to Ford’s top 5 between the approximately 245,000 employees worldwide they would each receive an additional $24,836.74 each. A nice additional annual wage for many of them. In fact, paying every single one of Ford's employees as much as the best paid UAW-represented skilled-trades workers ($67,225 /yr) would cost the company a mere $16.4 million. That's less than three-quarters of Mulally's take home pay!
What were the “Labor costs” which the Republicans are so anxious to reduce?
Wage rates for 2006, according to the UAW, which covers about 721,025 employees at the big 3, were as follows;
• A typical UAW-represented assembler at GM earned $27.81 per hour of straight-time labor. ($58,240/yr)
• A typical UAW-represented skilled-trades worker at GM earned $32.32 per hour of straight-time labor. ($67,225 /yr)
In addition to regular hourly pay, labor cost figures include overtime, shift premiums and the costs of negotiated benefits such as holidays, vacations, health care, pensions and education and training. It also includes statutory costs, which employers are required to pay by law, such as federal contributions for Social Security and Medicare, and state payments to workers’ compensation and unemployment insurance funds. The highest figures sometimes cited also include the benefit costs of retirees who are no longer on the payroll.
How much value do UAW members contribute to their employers?
According to the U.S. Census Bureau, the typical autoworker produces value added worth $206 per worker per hour. This is far more than he or she earns in wages, even when benefits, statutory contributions and other costs are included.
How much are labor costs in relation to the total price of a new vehicle?
The total labor cost of a new vehicle produced in the United States is about $2,400 which includes direct, indirect and salaried labor for engines, stamping and assembly at the automakers’ plants. This represents 8.4 percent of the typical $28,4513 price of a new vehicle in 2006. The vast majority of the costs of producing a vehicle and transporting it to a dealership and preparing it for sale – including design, engineering, marketing, raw materials, executive compensation and other costs – are not related to direct or indirect manufacturing labor.
So this is what the Republicans are so keen to destroy - a union-negotiated wage which provides a decent income to automobile workers, while preserving the obscene compensation packages of the grossly overpaid executives. What a bill of goods!
What is the compensation for auto industry executives?
In 2006, the CEOs of Chrysler Group, Ford and GM earned a combined total of $24.5 million in salaries, bonuses and other compensation in 2006. The next four highest paid executives received average salary and other compensation of $1.3 million at Ford and $1.4 million at GM.
Looks like they will lose a few million each. But, are they planning to forego all compensation except $1, or only salary? Or salary and bonuses? What about stocks and stock options that were also part of executive compensation, which were not included in the figures above.
We can see more clearly what else they might give up in these figures for Ford’s top 5 employees, from Ford’s Annual Report for 2007.
• Alan Mulally, Ford president and chief executive officer, earned $2,000,000 in salary and received incentive bonus awards of $7 million. His total 2007 compensation was $21,670,674, which includes salary, bonuses, the Company-recognized expense for stock options and other stock-based awards, as well as all other compensation. His salary, in other words, was a mere 9.23% of his total compensation.
• Don Leclair, Ford executive vice president and chief financial officer, earned $1,005,633 in salary and received incentive bonus awards of $3 million. His 2007 compensation totaled $11,703,127. (Salary was 8.6%)
• Mark Fields, Ford executive vice president and president, The Americas, earned $1,255,634 in salary and received incentive bonus awards of $2,850,000. His 2007 compensation totaled $8,389,898. (15%)
• Lewis Booth, Ford executive vice president, Ford of Europe and Premier Automotive Group, earned $868,133 in salary and received incentive bonus awards of $2,250,000. His 2007 compensation totaled $10,264,463. (8.46%)
• Mike Bannister, Ford executive vice president and CEO, Ford Motor Credit Company earned $708,700 in salary and received incentive bonus awards of $2,150,000. His 2007 compensation totaled $8,677,747. (8.17%)
In other words in 2007, while salary and bonuses were approximately $6 million dollars, this represented only 8-15% of the total compensation they received for their year’s efforts. These top 5 Ford employees actually received approximately $60.72 million in total compensation. For the same period GM’s top 2 earned $15.7 million for 2007, up 64 percent from the previous year, (while GM lost a record $38.7 billion). Because Chrysler is privately owned it does not have to publish this information - but I imagine the figures are much the same.
How much of this total compensation are the CEO’s offering to give up? That is not clear!
Just for comparison, what else could these dollars cover?
If you divided the $60.72 million compensation paid to Ford’s top 5 between the approximately 245,000 employees worldwide they would each receive an additional $24,836.74 each. A nice additional annual wage for many of them. In fact, paying every single one of Ford's employees as much as the best paid UAW-represented skilled-trades workers ($67,225 /yr) would cost the company a mere $16.4 million. That's less than three-quarters of Mulally's take home pay!
What were the “Labor costs” which the Republicans are so anxious to reduce?
Wage rates for 2006, according to the UAW, which covers about 721,025 employees at the big 3, were as follows;
• A typical UAW-represented assembler at GM earned $27.81 per hour of straight-time labor. ($58,240/yr)
• A typical UAW-represented skilled-trades worker at GM earned $32.32 per hour of straight-time labor. ($67,225 /yr)
In addition to regular hourly pay, labor cost figures include overtime, shift premiums and the costs of negotiated benefits such as holidays, vacations, health care, pensions and education and training. It also includes statutory costs, which employers are required to pay by law, such as federal contributions for Social Security and Medicare, and state payments to workers’ compensation and unemployment insurance funds. The highest figures sometimes cited also include the benefit costs of retirees who are no longer on the payroll.
How much value do UAW members contribute to their employers?
According to the U.S. Census Bureau, the typical autoworker produces value added worth $206 per worker per hour. This is far more than he or she earns in wages, even when benefits, statutory contributions and other costs are included.
How much are labor costs in relation to the total price of a new vehicle?
The total labor cost of a new vehicle produced in the United States is about $2,400 which includes direct, indirect and salaried labor for engines, stamping and assembly at the automakers’ plants. This represents 8.4 percent of the typical $28,4513 price of a new vehicle in 2006. The vast majority of the costs of producing a vehicle and transporting it to a dealership and preparing it for sale – including design, engineering, marketing, raw materials, executive compensation and other costs – are not related to direct or indirect manufacturing labor.
So this is what the Republicans are so keen to destroy - a union-negotiated wage which provides a decent income to automobile workers, while preserving the obscene compensation packages of the grossly overpaid executives. What a bill of goods!
Saturday, November 8, 2008
Changing generations
For all the moving photos of the campaign trail, of the rally at Grant Park, and of the headlines around the world, the most moving photo for me was the photo in the New York Times on November 5, of ""Latrice Barnes and her daughter.
Judith Warner wrote of this photo in the same paper the following day: "For me, this will be the enduring memory of election night 2008: One generation released its grief. The next looked up confusedly, eager to please and yet unable to comprehend just what the tears were about."
Barack Obama is right. Younger people are indeed growing up in a world of new sensibilities!
Judith Warner wrote of this photo in the same paper the following day: "For me, this will be the enduring memory of election night 2008: One generation released its grief. The next looked up confusedly, eager to please and yet unable to comprehend just what the tears were about."
Barack Obama is right. Younger people are indeed growing up in a world of new sensibilities!
now for some good economics maybe?
“We have always known that heedless self-interest was bad morals; we know now that it is bad economics”
Franklin Delano Roosevelt
To which Paul Krugman adds:
And right now happens to be one of those times when the converse is also true, and good morals are good economics. Helping the neediest in a time of crisis, through expanded health and unemployment benefits, is the morally right thing to do; it’s also a far more effective form of economic stimulus than cutting the capital gains tax. Providing aid to beleaguered state and local governments, so that they can sustain essential public services, is important for those who depend on those services; it’s also a way to avoid job losses and limit the depth of the economy’s slump. So a serious progressive agenda — call it a new New Deal — isn’t just economically possible, it’s exactly what the economy needs.
I am SO glad to hear that!
Franklin Delano Roosevelt
To which Paul Krugman adds:
And right now happens to be one of those times when the converse is also true, and good morals are good economics. Helping the neediest in a time of crisis, through expanded health and unemployment benefits, is the morally right thing to do; it’s also a far more effective form of economic stimulus than cutting the capital gains tax. Providing aid to beleaguered state and local governments, so that they can sustain essential public services, is important for those who depend on those services; it’s also a way to avoid job losses and limit the depth of the economy’s slump. So a serious progressive agenda — call it a new New Deal — isn’t just economically possible, it’s exactly what the economy needs.
I am SO glad to hear that!
Keeping a list
of items I want to action on in an Obama administration
Supreme Court items to watch out for include:
* Roe v Wade
* National security - guantanamo
* Church-state separation
* Gay rights
* Affirmative action
* Electoral issues - gerrymandering, FEC
* First Amendment protection
Then there is the whole matter of the corruption of the judiciary by the Republicans - can we reclaim the benches?
Supreme Court items to watch out for include:
* Roe v Wade
* National security - guantanamo
* Church-state separation
* Gay rights
* Affirmative action
* Electoral issues - gerrymandering, FEC
* First Amendment protection
Then there is the whole matter of the corruption of the judiciary by the Republicans - can we reclaim the benches?
New York Times catches up
See my posts on this dated September 20 2008
From the New York Times, November 7, 2008
Georgia Claims on Russia War Called Into Question
By C. J. CHIVERS and ELLEN BARRY
Newly available accounts raise questions about the accuracy and honesty of Georgia’s insistence that it acted defensively against Russian aggression.
From the New York Times, November 7, 2008
Georgia Claims on Russia War Called Into Question
By C. J. CHIVERS and ELLEN BARRY
Newly available accounts raise questions about the accuracy and honesty of Georgia’s insistence that it acted defensively against Russian aggression.
Saturday, October 25, 2008
Was the bank bailout bill a bill of goods?
Joe Nocera, New York Times business analyst, thinks so.
Christopher J. Dodd, a Connecticut Democrat and chair of the Senate Banking Committee On Thursday, asked Neel Kashkari - the former Goldman Sachs Vice President Henry Paulson appointed to oversee the bailout - why the banks were being slow to make loans.
Senator Dodd: "How was Treasury going to ensure that banks used their new government capital to make loans — “besides rhetorically begging them?”
Kashkari: “We share your view. We want our banks to be lending in our communities.”
According to Nocera, what is actually happening is quite different. He suggests that Paulson’s rationale for the bailout - that banks would start lending again - "is a fig leaf.”
Instead the real agenda is more bank mergers.
Treasury recently introduced a new tax break that, according to Nocera, has only one purpose: to encourage bank mergers”. He cites tax expert Robert Willens: “It couldn’t be clearer if they had taken out an ad.”
As a result of this and other moves, “investors no longer trust Treasury.”
"First it says it has to have $700 billion to buy back toxic mortgage-backed securities.
"Then, as Mr. Paulson divulged to The Times this week, it turns out that even before the bill passed the House, he told his staff to start drawing up a plan for capital injections. Fearing Congress’s reaction, he didn’t tell the Hill about his change of heart.
"Now, he’s shifted gears again, and is directing Treasury to use the money to force bank acquisitions."
And loans to the public meantime?
“The dirty little secret of the banking industry is that it has no intention of using the money to make new loans”. Nocera listened in on a conference call between Chase executives and caught the following discussion of how Chase was going to spend the $25 billion it received from the Treasury:
“Twenty-five billion dollars is obviously going to help the folks who are struggling more than Chase,” he began. “What we do think it will help us do is perhaps be a little bit more active on the acquisition side or opportunistic side for some banks who are still struggling. And I would not assume that we are done on the acquisition side just because of the Washington Mutual and Bear Stearns mergers. I think there are going to be some great opportunities for us to grow in this environment, and I think we have an opportunity to use that $25 billion in that way and obviously depending on whether recession turns into depression or what happens in the future, you know, we have that as a backstop.”
“Read that answer as many times as you want”, says Nocera, “you are not going to find a single word in there about making loans to help the American economy.”
Nocera chased down Senator Dodd “and asked him what he was going to do if the loan situation didn’t improve. “All I can tell you is that we are going to have the bankers up here .... If it turns out that they are hoarding, you’ll have a revolution on your hands. ... There will be hell to pay.”
Nocera’s summary:
“I don’t know about you, but I’m starting to feel as if we’ve been sold a bill of goods.”
So When Will Banks Give Loans? By Joe Nocera, NYT. Published: October 24, 2008
Christopher J. Dodd, a Connecticut Democrat and chair of the Senate Banking Committee On Thursday, asked Neel Kashkari - the former Goldman Sachs Vice President Henry Paulson appointed to oversee the bailout - why the banks were being slow to make loans.
Senator Dodd: "How was Treasury going to ensure that banks used their new government capital to make loans — “besides rhetorically begging them?”
Kashkari: “We share your view. We want our banks to be lending in our communities.”
According to Nocera, what is actually happening is quite different. He suggests that Paulson’s rationale for the bailout - that banks would start lending again - "is a fig leaf.”
Instead the real agenda is more bank mergers.
Treasury recently introduced a new tax break that, according to Nocera, has only one purpose: to encourage bank mergers”. He cites tax expert Robert Willens: “It couldn’t be clearer if they had taken out an ad.”
As a result of this and other moves, “investors no longer trust Treasury.”
"First it says it has to have $700 billion to buy back toxic mortgage-backed securities.
"Then, as Mr. Paulson divulged to The Times this week, it turns out that even before the bill passed the House, he told his staff to start drawing up a plan for capital injections. Fearing Congress’s reaction, he didn’t tell the Hill about his change of heart.
"Now, he’s shifted gears again, and is directing Treasury to use the money to force bank acquisitions."
And loans to the public meantime?
“The dirty little secret of the banking industry is that it has no intention of using the money to make new loans”. Nocera listened in on a conference call between Chase executives and caught the following discussion of how Chase was going to spend the $25 billion it received from the Treasury:
“Twenty-five billion dollars is obviously going to help the folks who are struggling more than Chase,” he began. “What we do think it will help us do is perhaps be a little bit more active on the acquisition side or opportunistic side for some banks who are still struggling. And I would not assume that we are done on the acquisition side just because of the Washington Mutual and Bear Stearns mergers. I think there are going to be some great opportunities for us to grow in this environment, and I think we have an opportunity to use that $25 billion in that way and obviously depending on whether recession turns into depression or what happens in the future, you know, we have that as a backstop.”
“Read that answer as many times as you want”, says Nocera, “you are not going to find a single word in there about making loans to help the American economy.”
Nocera chased down Senator Dodd “and asked him what he was going to do if the loan situation didn’t improve. “All I can tell you is that we are going to have the bankers up here .... If it turns out that they are hoarding, you’ll have a revolution on your hands. ... There will be hell to pay.”
Nocera’s summary:
“I don’t know about you, but I’m starting to feel as if we’ve been sold a bill of goods.”
So When Will Banks Give Loans? By Joe Nocera, NYT. Published: October 24, 2008
Thursday, October 23, 2008
A sleazy blizzard
It's a blizzard of really nasty robocalls and flyers in the mail.
After several last week we got 2 calls yesterday, but one friend got 3 in an hour - all disgusting anti-Obama stuff, from the Republican National Committee and the McCain campaign - they aren't even using cover.
Here' s one we got (I got the text from Democracy Now's website, but it is word for word)
McCAIN ROBOCALL: Hello, I’m calling for John McCain and the RNC, because you need to know that Barack Obama has worked closely with domestic terrorist Bill Ayers, whose organization bombed the US Capitol, the Pentagon, a judge’s home, and killed Americans. And Democrats will enact an extreme leftist agenda if they take control of Washington. Barack Obama and his Democratic allies lack the judgment to lead our country. This call was paid for by McCain-Palin 2008 and the Republican National Committee at 202-863-8500.
The flyer covers the same ground.
Unlike John Kerry, who was slow responding to the Swift Boat crap, Obama folk move fast. Here is their response:
OBAMA ROBOCALL: Hi. This is Jeri Watermolen calling for the Campaign for Change. I live in Green Bay, and like you, I’ve been getting sleazy phone calls and mail from John McCain and his supporters, viciously and falsely attacking Barack Obama. I used to support John McCain, because he honorably served our country. But this year he’s running a dishonorable campaign. We know McCain will continue many of Bush’s policies, and now he’s using George Bush’s divisive tactics. In fact, he hired the Bush strategist whose attacks even McCain once called hateful. Barack Obama will turn the page on these negative politics and stand up for the middle class. That’s the change we need, and it is why I have changed my mind about John McCain. Join me in voting for Barack Obama. Paid for by the Campaign for Change, a project of the Democratic Party of Wisconsin, 608-255-5172, and authorized by Obama for America. (Again, text from Democracy Now website).
And the reaction is good. For one, a Madison man who quit his job rather than make these calls is getting national attention, including in the NYT today. And this from that same story.
"On MSNBC, Representative Michele Bachmann of Minnesota was launching into the Obama/terrorist spin when she suggested that the news media should investigate “the views of the people in Congress and find out: Are they pro-America or anti-America.” So far, the only person who’s felt the impact of her call to reinvent McCarthyism for a post-Communist planet has been her opponent, a hitherto totally ignored Democrat named Elwyn Tinklenberg, who was stunned to discover in the following days that he had received close to $1 million in donations."
MAYBE sleaze isn't going to pay off this time.
After several last week we got 2 calls yesterday, but one friend got 3 in an hour - all disgusting anti-Obama stuff, from the Republican National Committee and the McCain campaign - they aren't even using cover.
Here' s one we got (I got the text from Democracy Now's website, but it is word for word)
McCAIN ROBOCALL: Hello, I’m calling for John McCain and the RNC, because you need to know that Barack Obama has worked closely with domestic terrorist Bill Ayers, whose organization bombed the US Capitol, the Pentagon, a judge’s home, and killed Americans. And Democrats will enact an extreme leftist agenda if they take control of Washington. Barack Obama and his Democratic allies lack the judgment to lead our country. This call was paid for by McCain-Palin 2008 and the Republican National Committee at 202-863-8500.
The flyer covers the same ground.
Unlike John Kerry, who was slow responding to the Swift Boat crap, Obama folk move fast. Here is their response:
OBAMA ROBOCALL: Hi. This is Jeri Watermolen calling for the Campaign for Change. I live in Green Bay, and like you, I’ve been getting sleazy phone calls and mail from John McCain and his supporters, viciously and falsely attacking Barack Obama. I used to support John McCain, because he honorably served our country. But this year he’s running a dishonorable campaign. We know McCain will continue many of Bush’s policies, and now he’s using George Bush’s divisive tactics. In fact, he hired the Bush strategist whose attacks even McCain once called hateful. Barack Obama will turn the page on these negative politics and stand up for the middle class. That’s the change we need, and it is why I have changed my mind about John McCain. Join me in voting for Barack Obama. Paid for by the Campaign for Change, a project of the Democratic Party of Wisconsin, 608-255-5172, and authorized by Obama for America. (Again, text from Democracy Now website).
And the reaction is good. For one, a Madison man who quit his job rather than make these calls is getting national attention, including in the NYT today. And this from that same story.
"On MSNBC, Representative Michele Bachmann of Minnesota was launching into the Obama/terrorist spin when she suggested that the news media should investigate “the views of the people in Congress and find out: Are they pro-America or anti-America.” So far, the only person who’s felt the impact of her call to reinvent McCarthyism for a post-Communist planet has been her opponent, a hitherto totally ignored Democrat named Elwyn Tinklenberg, who was stunned to discover in the following days that he had received close to $1 million in donations."
MAYBE sleaze isn't going to pay off this time.
Sunday, October 5, 2008
Goldman Sachs fingers in Wall Street bailout?
I was struck by the fact that no-one in power seemed to have noticed that we were in economic trouble until their pockets were threatened, when all of a sudden they decided to pick ours.
So I was intrigued by the question as to whether Henry Paulson's Goldman Sachs background and connections had anything to do with his sudden discovery of the problem. (Or rather whether there were any smoking pistols). Seems pretty clear from the following timeline:
On Sept 14 Lehmans was allowed to go into bankruptcy, Merrill Lynch was in trouble, and AIG asked The Fed for $40b.
Over the weekend Sept 14-15, there were meetings at the New York Federal Reserve. Henry M. Paulson Jr., the Treasury secretary, attended as did Lloyd C. Blankfein, the chief executive of Goldman Sachs attended the weekend meetings.
On Sept 15 the Fed said no to AIG, the Dow Jones sank over 500 points.
On Sept 16 there was another high level meeting to discuss financial aid for A.I.G. which Henry Paulson did not attend, but Blankfein was the ONLY Wall Street chief executive who attended this meeting. The Fed changed its mind and gave AIG $85b.
Why let Lehman collapse, but first deny then save AIG?
Probably not the only reason, but my guess is not unrelated, Goldman Sachs was deeply threatened by an AIG collapse, though few people were aware of this at first. A Goldman spokesman, declined to detail how badly hurt his firm might have been had A.I.G. collapsed and Goldman’s chief financial officer, assured analysts on Sept. 16 that his firm’s exposure was “immaterial". But other stories have confirmed that GS was in danger. By one calculation Goldman had $20 billion worth of risk tied to A.I.G.
On Sept. 16 the government announced its two-year, $85 billion loan to A.I.G. What is notable is that the plan saved the insurer’s trading partners - such as Goldman Sachs - but decimated its shareholders.
A Treasury spokeswoman declined to comment about Goldman’s role in the A.I.G. rescue. However turn around again and suddenly Goldman had changed its regulatory status to help bolster its finances.
Regarding Mr. Blankfein’s presence at the Fed during talks about an A.I.G. bailout, Goldman's CFO said: “I think it would be a mistake to read into it that he was there because of our own interests. We were engaged because of the implications to the entire system.”
On Sept 18 Secretary Paulson went the next step and proposed the $700 billion to bailout 'the entire system'.
So I was intrigued by the question as to whether Henry Paulson's Goldman Sachs background and connections had anything to do with his sudden discovery of the problem. (Or rather whether there were any smoking pistols). Seems pretty clear from the following timeline:
On Sept 14 Lehmans was allowed to go into bankruptcy, Merrill Lynch was in trouble, and AIG asked The Fed for $40b.
Over the weekend Sept 14-15, there were meetings at the New York Federal Reserve. Henry M. Paulson Jr., the Treasury secretary, attended as did Lloyd C. Blankfein, the chief executive of Goldman Sachs attended the weekend meetings.
On Sept 15 the Fed said no to AIG, the Dow Jones sank over 500 points.
On Sept 16 there was another high level meeting to discuss financial aid for A.I.G. which Henry Paulson did not attend, but Blankfein was the ONLY Wall Street chief executive who attended this meeting. The Fed changed its mind and gave AIG $85b.
Why let Lehman collapse, but first deny then save AIG?
Probably not the only reason, but my guess is not unrelated, Goldman Sachs was deeply threatened by an AIG collapse, though few people were aware of this at first. A Goldman spokesman, declined to detail how badly hurt his firm might have been had A.I.G. collapsed and Goldman’s chief financial officer, assured analysts on Sept. 16 that his firm’s exposure was “immaterial". But other stories have confirmed that GS was in danger. By one calculation Goldman had $20 billion worth of risk tied to A.I.G.
On Sept. 16 the government announced its two-year, $85 billion loan to A.I.G. What is notable is that the plan saved the insurer’s trading partners - such as Goldman Sachs - but decimated its shareholders.
A Treasury spokeswoman declined to comment about Goldman’s role in the A.I.G. rescue. However turn around again and suddenly Goldman had changed its regulatory status to help bolster its finances.
Regarding Mr. Blankfein’s presence at the Fed during talks about an A.I.G. bailout, Goldman's CFO said: “I think it would be a mistake to read into it that he was there because of our own interests. We were engaged because of the implications to the entire system.”
On Sept 18 Secretary Paulson went the next step and proposed the $700 billion to bailout 'the entire system'.
Monday, September 1, 2008
Who's rich, who's poor
John McCain thinks the line between rich and poor is about $5 million a year. That makes the vast majority of us poor, but also shows he doesn't know much about how the vast majority of us live. I guess he only knows rich folk.
But then many people think that the Republicans make life better for most of us, too - another error. The historical record shows that under Democrats we all do better. Under Republicans even the rich don't do as well as they would with a Dem President - but pity the poor!
Family Income Growth, annual average 1948-2005
By income level (Adjusted for inflation)
Percentile Under Dem. Pres. Under Rep. Pres
20th + 2.64% + 0.43%
40th + 2.46% + 0.8 %
60th + 2.47% + 1.13%
80th + 2.38% + 1.39%
95th + 2.12% + 1.90%
The 20th percentile is a plausible dividing line between the poor and the non-poor.
The 95th percentile is the best dividing line between the rich and the nonrich - well below the $5 million threshold John McCain used. It’s closer to $180,000.
Source: Is History Siding With Obama’s Economic Plan?
By ALAN S. BLINDER, August 30, 2008
http://www.nytimes.com/2008/08/31/business/31view.html?scp=1&sq=Blinder&st=cse
But then many people think that the Republicans make life better for most of us, too - another error. The historical record shows that under Democrats we all do better. Under Republicans even the rich don't do as well as they would with a Dem President - but pity the poor!
Family Income Growth, annual average 1948-2005
By income level (Adjusted for inflation)
Percentile Under Dem. Pres. Under Rep. Pres
20th + 2.64% + 0.43%
40th + 2.46% + 0.8 %
60th + 2.47% + 1.13%
80th + 2.38% + 1.39%
95th + 2.12% + 1.90%
The 20th percentile is a plausible dividing line between the poor and the non-poor.
The 95th percentile is the best dividing line between the rich and the nonrich - well below the $5 million threshold John McCain used. It’s closer to $180,000.
Source: Is History Siding With Obama’s Economic Plan?
By ALAN S. BLINDER, August 30, 2008
http://www.nytimes.com/2008/08/31/business/31view.html?scp=1&sq=Blinder&st=cse
Wednesday, August 20, 2008
Want more wars? Vote Johnny ‘shoot ‘em down’ McCain
Let’s be clear: Georgian President Mikheil Saakashvili started this particular outbreak of violence. On the night of Aug. 7, Saakashvili ordered an artillery barrage against Tskhinvali, in South Ossetia, and sent an armored column to occupy the town, killing a number of Russian peacekeepers. As a result of a three-day battle Tskhinvali was in smoking ruins and thousands of people fled. However Russian claims of genocide appear to have been exaggerated.
The big question is Why? Was Saakashvili under the impression that NATO or the US military would intervene if Russia fought back? It seems hard to imagine that he would have invaded South Ossetia if he did not think he had American backing. How could he have had that idea?
Well now ... joint US-Georgian military exercises ended just hours before Georgian troops moved into the province. A senior Bush administration official acknowledged that “it’s possible that Georgians may have confused the cheerleading from Washington with something else.”
And the 'confusing cheerleading' goes back longer than that. The US foreign policy teams have crammed NATO expansion down the Russians’ throats since the collapse of the Soviet Union. The West has expanded military alliances up to Russian borders, and assumed that Russia would do nothing about it.
A Russian perspective
Former Soviet leader Mikhael Gorbachev points out that Russia has long been told to simply accept the facts on a number of issues:
On the independence of Kosovo, the Russians had insisted that independence for Kosovo would be a serious affront. Last February, the United States and the European Union, over Russia’s vehement objections, recognized an independent Kosovo.
On the abrogation of the Antiballistic Missile Treaty, and the American decision to place missile defenses in neighboring countries:(today) August 20 2008 the US and Poland announced an agreement on the siting of 10 interceptor missiles in northern Poland.
On the unending expansion of NATO: Mr. Bush has promised NATO membership and its accompanying umbrella of American military support to Georgia.
Mr. Putin, angry at what he saw as American infringement right in his backyard, decided that Georgia was the line in the sand that the West would not be allowed to cross.
The McCain connection: McCain adviser also Georgia lobbyist.
Was McCain himself involved in setting this Russian bear trap? The Georgian crisis has created a campaign issue McCain can run on. The new trumped up threats about Russia make his antic-Soviet experience "relevant" again. And John McCain and friends were busy stirring the pot.
On April 17 McCain spoke with Saakashvili by phone, a call arranged by Randy Scheunemann, his major foreign policy adviser. Scheunemann is a leading neo-conservative lobbyist for oil companies and arms manufacturer. He was until recently a registered foreign agent for Georgia, and was Director of the Committee for the Liberation of Iraq. After the conversation, McCain issued a statement, saying that “we must not allow Russia to believe it has a free hand to engage in policies that undermine Georgian sovereignty.” Later that day, Scheunemann's Orion Strategies lobbying firm signed a new $200,000 deal with Georgia.
Bush team divided
Within the Bush administration, there is discord, as “the fight between the hawks and the doves” erupted anew, according to one administration official.
The hawks: Cheney and his aides and allies including the assistant secretary of state for Europe, Daniel Fried, see Georgia as a role model for their democracy promotion campaign. They have argued for more American military aid for Georgia, including Stinger antiaircraft missiles, so that it could defend itself against possible Russian aggression.
The “doves”: Condoleezza Rice, National Security Adviser Stephen J. Hadley and William J. Burns, the new under secretary of state for political affairs, have urged restraint. They argued that such a sale would provoke Russia, which would see it as arrogant meddling in its turf, the officials and diplomats said. Ms. Rice, for the time being, has won the fight against adding American-provided Stinger missiles to Georgia’s arsenal.
Is Saakashvili a democrat?
By last November, Mr. Saakashvili’s democratic credentials were becoming checkered. Accused by the opposition of corruption, arrogance and centralization, he declared a state of emergency. He won a snap election this year on a vote that the opposition said was rigged.
The oil connection:
If Saakashvili did believe he had US support, why did he not get it? Perhaps this is where that favorite foreign policy addiction – oil – plays a role in this dispute. The United States has poured hundreds of millions of dollars in aid and military hardware, mostly to protect the Baku-Tbilisi-Ceyhan pipeline that bypasses Russia and Iran on its way to Turkey.
Sources
U.S. Watched as a Squabble Turned Into a Showdown, Helene Cooper, C.J. Chivers, Clifford Levy, The New York Times, August 18, 2008 US troops train Georgians amid tension by Douglas Birch and Misha Dzhindzhikhashvili Associated Press, Jul 21st, 2008 | TBILISI, Georgia What Did We Expect? By Thomas Friedman, The New York Times: August 19, 2008 Russia Never Wanted a War, by Mikhael Gorbachev, The New York Times: August 19, 2008 The Battle of Tskhinvali Tour of Tskhinvali undercuts Russian claim of genocide, By Tom Lasseter | McClatchy Newspapers, Associated Press, Sunday, August 17, 2008Oil pipelines
The big question is Why? Was Saakashvili under the impression that NATO or the US military would intervene if Russia fought back? It seems hard to imagine that he would have invaded South Ossetia if he did not think he had American backing. How could he have had that idea?
Well now ... joint US-Georgian military exercises ended just hours before Georgian troops moved into the province. A senior Bush administration official acknowledged that “it’s possible that Georgians may have confused the cheerleading from Washington with something else.”
And the 'confusing cheerleading' goes back longer than that. The US foreign policy teams have crammed NATO expansion down the Russians’ throats since the collapse of the Soviet Union. The West has expanded military alliances up to Russian borders, and assumed that Russia would do nothing about it.
A Russian perspective
Former Soviet leader Mikhael Gorbachev points out that Russia has long been told to simply accept the facts on a number of issues:
On the independence of Kosovo, the Russians had insisted that independence for Kosovo would be a serious affront. Last February, the United States and the European Union, over Russia’s vehement objections, recognized an independent Kosovo.
On the abrogation of the Antiballistic Missile Treaty, and the American decision to place missile defenses in neighboring countries:(today) August 20 2008 the US and Poland announced an agreement on the siting of 10 interceptor missiles in northern Poland.
On the unending expansion of NATO: Mr. Bush has promised NATO membership and its accompanying umbrella of American military support to Georgia.
Mr. Putin, angry at what he saw as American infringement right in his backyard, decided that Georgia was the line in the sand that the West would not be allowed to cross.
The McCain connection: McCain adviser also Georgia lobbyist.
Was McCain himself involved in setting this Russian bear trap? The Georgian crisis has created a campaign issue McCain can run on. The new trumped up threats about Russia make his antic-Soviet experience "relevant" again. And John McCain and friends were busy stirring the pot.
On April 17 McCain spoke with Saakashvili by phone, a call arranged by Randy Scheunemann, his major foreign policy adviser. Scheunemann is a leading neo-conservative lobbyist for oil companies and arms manufacturer. He was until recently a registered foreign agent for Georgia, and was Director of the Committee for the Liberation of Iraq. After the conversation, McCain issued a statement, saying that “we must not allow Russia to believe it has a free hand to engage in policies that undermine Georgian sovereignty.” Later that day, Scheunemann's Orion Strategies lobbying firm signed a new $200,000 deal with Georgia.
Bush team divided
Within the Bush administration, there is discord, as “the fight between the hawks and the doves” erupted anew, according to one administration official.
The hawks: Cheney and his aides and allies including the assistant secretary of state for Europe, Daniel Fried, see Georgia as a role model for their democracy promotion campaign. They have argued for more American military aid for Georgia, including Stinger antiaircraft missiles, so that it could defend itself against possible Russian aggression.
The “doves”: Condoleezza Rice, National Security Adviser Stephen J. Hadley and William J. Burns, the new under secretary of state for political affairs, have urged restraint. They argued that such a sale would provoke Russia, which would see it as arrogant meddling in its turf, the officials and diplomats said. Ms. Rice, for the time being, has won the fight against adding American-provided Stinger missiles to Georgia’s arsenal.
Is Saakashvili a democrat?
By last November, Mr. Saakashvili’s democratic credentials were becoming checkered. Accused by the opposition of corruption, arrogance and centralization, he declared a state of emergency. He won a snap election this year on a vote that the opposition said was rigged.
The oil connection:
If Saakashvili did believe he had US support, why did he not get it? Perhaps this is where that favorite foreign policy addiction – oil – plays a role in this dispute. The United States has poured hundreds of millions of dollars in aid and military hardware, mostly to protect the Baku-Tbilisi-Ceyhan pipeline that bypasses Russia and Iran on its way to Turkey.
Sources
U.S. Watched as a Squabble Turned Into a Showdown, Helene Cooper, C.J. Chivers, Clifford Levy, The New York Times, August 18, 2008 US troops train Georgians amid tension by Douglas Birch and Misha Dzhindzhikhashvili Associated Press, Jul 21st, 2008 | TBILISI, Georgia What Did We Expect? By Thomas Friedman, The New York Times: August 19, 2008 Russia Never Wanted a War, by Mikhael Gorbachev, The New York Times: August 19, 2008 The Battle of Tskhinvali Tour of Tskhinvali undercuts Russian claim of genocide, By Tom Lasseter | McClatchy Newspapers, Associated Press, Sunday, August 17, 2008Oil pipelines
Caucasian War Timeline
Timeline: 2008
January: Georgian Ministry of Defense released a “strategic defense review” that laid out its broad military planning for the breakaway regions.
March 19: Saakashvili was in Washington to push for NATO membership for Georgia
April 3: Bush lobbied NATO leaders for Ukraine and Georgia to be welcomed into a Membership Action Plan that prepares nations for NATO membership, the night before the NATO summit meeting in Bucharest, Romania. Mr. Bush lost that battle.
April 4: NATO leaders agreed to endorse a United States missile defense system based in Eastern Europe, and the Europeans said invitations to the membership plan for Georgia and Ukraine might come in a year, at the next summit.
April 17: McCain spoke with Saakashvili by phone, a call arranged by Randy Scheunemann, his major foreign policy adviser. After the conversation, McCain issued a statement, on that “we must not allow Russia to believe it has a free hand to engage in policies that undermine Georgian sovereignty.”
Scheunemann is a leading neo-conservative lobbyist for oil companies and arms manufacturer. He was until recently a registered foreign agent for Georgia, and was Director of the Committee for the Liberation of Iraq. Later that day, Scheunemann's Orion Strategies lobbying firm signed a new $200,000 deal with Georgia.
April 21: a Georgian pilotless reconnaissance plane flying over Abkhazia was shot down. Georgia accused Russia of shooting it down while Mr. Putin expressed “bewilderment” at Georgia’s sending planes over Abkhazia.
May and June: Russia increased the number of troops in South Ossetia and sent troops into Abkhazia for ‘humanitarian’ reasons.
July: Condaleeza Rice in Tbilisi, where, aides said, she privately told Mr. Saakashvili not to let Russia provoke him into a fight he could not win. But her public comments were far more supportive.
July 21 - Aug 6: Joint US-Georgian military exercises involving more than 1,000 U.S. Marines and soldiers at a former Soviet base Monday, amid heightened tensions with Moscow.
August 1-5: Shelling from South Ossetia to Georgia proper increased significantly Georgian police officers were wounded by remotely detonated explosions in South Ossetia. Troops from Georgia battled separatist fighters, killing at least 6 people; the Georgians accused the South Ossetian separatists of firing at Georgian towns behind the shelter of Russian peacekeepers.
August 6: Separatists fired on several Georgian villages. The Russian Defense Ministry and South Ossetian officials say that Georgians provoked the escalation by shelling Russian peacekeeping positions in the region’s capital of Tskhinvali, along with civilian areas.
January: Georgian Ministry of Defense released a “strategic defense review” that laid out its broad military planning for the breakaway regions.
March 19: Saakashvili was in Washington to push for NATO membership for Georgia
April 3: Bush lobbied NATO leaders for Ukraine and Georgia to be welcomed into a Membership Action Plan that prepares nations for NATO membership, the night before the NATO summit meeting in Bucharest, Romania. Mr. Bush lost that battle.
April 4: NATO leaders agreed to endorse a United States missile defense system based in Eastern Europe, and the Europeans said invitations to the membership plan for Georgia and Ukraine might come in a year, at the next summit.
April 17: McCain spoke with Saakashvili by phone, a call arranged by Randy Scheunemann, his major foreign policy adviser. After the conversation, McCain issued a statement, on that “we must not allow Russia to believe it has a free hand to engage in policies that undermine Georgian sovereignty.”
Scheunemann is a leading neo-conservative lobbyist for oil companies and arms manufacturer. He was until recently a registered foreign agent for Georgia, and was Director of the Committee for the Liberation of Iraq. Later that day, Scheunemann's Orion Strategies lobbying firm signed a new $200,000 deal with Georgia.
April 21: a Georgian pilotless reconnaissance plane flying over Abkhazia was shot down. Georgia accused Russia of shooting it down while Mr. Putin expressed “bewilderment” at Georgia’s sending planes over Abkhazia.
May and June: Russia increased the number of troops in South Ossetia and sent troops into Abkhazia for ‘humanitarian’ reasons.
July: Condaleeza Rice in Tbilisi, where, aides said, she privately told Mr. Saakashvili not to let Russia provoke him into a fight he could not win. But her public comments were far more supportive.
July 21 - Aug 6: Joint US-Georgian military exercises involving more than 1,000 U.S. Marines and soldiers at a former Soviet base Monday, amid heightened tensions with Moscow.
August 1-5: Shelling from South Ossetia to Georgia proper increased significantly Georgian police officers were wounded by remotely detonated explosions in South Ossetia. Troops from Georgia battled separatist fighters, killing at least 6 people; the Georgians accused the South Ossetian separatists of firing at Georgian towns behind the shelter of Russian peacekeepers.
August 6: Separatists fired on several Georgian villages. The Russian Defense Ministry and South Ossetian officials say that Georgians provoked the escalation by shelling Russian peacekeeping positions in the region’s capital of Tskhinvali, along with civilian areas.
Saturday, August 2, 2008
same old same old
New York Governor Paterson is calling for immediate action in the face of what he is describing as worst economic downturn in decades. And just what is he recommending to deal with it: “freezing state hiring and cutting prized programs, possibly including education and health care”.
Sounds familiar. Isn’t this what we have been doing for the past decade? So where is Paterson getting these not-so-fresh ideas? From a tried and true team – or perhaps a ‘tired and untrue’ team. Paterson has consulted with high-profile economists like Robert E. Rubin, the Treasury secretary in Bill Clinton’s administration, Ben S. Bernanke, the Federal Reserve chairman; Henry M. Paulson Jr., the Treasury secretary. Hven’t we seen these guys before. Is this what we can expect as proposed solutions to the crisis from a Democratic Administration in Washington? I hope not.
Opportunity Knocks as Paterson Tackles Budget
JEREMY W. PETERS, NYT, August 2, 2008
Sounds familiar. Isn’t this what we have been doing for the past decade? So where is Paterson getting these not-so-fresh ideas? From a tried and true team – or perhaps a ‘tired and untrue’ team. Paterson has consulted with high-profile economists like Robert E. Rubin, the Treasury secretary in Bill Clinton’s administration, Ben S. Bernanke, the Federal Reserve chairman; Henry M. Paulson Jr., the Treasury secretary. Hven’t we seen these guys before. Is this what we can expect as proposed solutions to the crisis from a Democratic Administration in Washington? I hope not.
Opportunity Knocks as Paterson Tackles Budget
JEREMY W. PETERS, NYT, August 2, 2008
no more avocado salad in January
Buying local gets a boost from oil prices, according to today's New York Times.
Extracted from an article in the business section (citation below).
The cost of shipping a 40-foot container from Shanghai to the United States has risen to $8,000, compared with $3,000 early in the decade, according to a recent study of transportation costs. Big container ships, the pack mules of the 21st-century economy, have shaved their top speed by nearly 20 percent to save on fuel costs, substantially slowing shipping times.
Soaring transportation costs also have an impact on food, from bananas to salmon. Higher shipping rates could eventually transform some items now found in the typical middle-class pantry into luxuries and further promote the so-called local food movement popular in many American and European cities. “This is not just about steel, but also maple syrup and avocados and blueberries at the grocery store,” shipped from places like Chile and South Africa, said Jeff Rubin, chief economist at CIBC World Markets and co-author of its recent study on transport costs and globalization. “Avocado salad in Minneapolis in January is just not going to work in this new world, because flying it in is going to make it cost as much as a rib eye.”
One likely outcome if transportation rates stay high, economists said, would be a strengthening of the neighborhood effect. Instead of seeking supplies wherever they can be bought most cheaply, regardless of location, and outsourcing the assembly of products all over the world, manufacturers would instead concentrate on performing those activities as close to home as possible.
But a trend toward regionalization would not necessarily benefit the United States, economists caution. Not only has it lost some of its manufacturing base and skills over the past quarter-century, and experienced a decline in consumer confidence as part of the current slowdown, but it is also far from the economies that have become the most dynamic in the world, those of Asia.
Source:
Shipping Costs Start to Crimp Globalization, By LARRY ROHTER, NYT : August 3, 2008
Extracted from an article in the business section (citation below).
The cost of shipping a 40-foot container from Shanghai to the United States has risen to $8,000, compared with $3,000 early in the decade, according to a recent study of transportation costs. Big container ships, the pack mules of the 21st-century economy, have shaved their top speed by nearly 20 percent to save on fuel costs, substantially slowing shipping times.
Soaring transportation costs also have an impact on food, from bananas to salmon. Higher shipping rates could eventually transform some items now found in the typical middle-class pantry into luxuries and further promote the so-called local food movement popular in many American and European cities. “This is not just about steel, but also maple syrup and avocados and blueberries at the grocery store,” shipped from places like Chile and South Africa, said Jeff Rubin, chief economist at CIBC World Markets and co-author of its recent study on transport costs and globalization. “Avocado salad in Minneapolis in January is just not going to work in this new world, because flying it in is going to make it cost as much as a rib eye.”
One likely outcome if transportation rates stay high, economists said, would be a strengthening of the neighborhood effect. Instead of seeking supplies wherever they can be bought most cheaply, regardless of location, and outsourcing the assembly of products all over the world, manufacturers would instead concentrate on performing those activities as close to home as possible.
But a trend toward regionalization would not necessarily benefit the United States, economists caution. Not only has it lost some of its manufacturing base and skills over the past quarter-century, and experienced a decline in consumer confidence as part of the current slowdown, but it is also far from the economies that have become the most dynamic in the world, those of Asia.
Source:
Shipping Costs Start to Crimp Globalization, By LARRY ROHTER, NYT : August 3, 2008
Friday, August 1, 2008
home ownership, racism and the subprime mess
Sunday, July 27, 2008
Before World War 2 less than 50% of US households owned their homes. By 1960 this had risen to nearly 65%, an increase fueled by deliberate government policy.
The Federal Housing Administration lowered the cost of buying homes by extending mortgage insurance, allowing banks to lend money at less risk and therefore at better terms to borrowers. Banks could now extend 30 year mortgages covering 80-90% of the buyer's cost at 6% interest.
But it was explicitly a whites only policy, guided by an FHA rule limiting loan underwriting to segregated white neighborhoods, a practice known as redlining. (Wikipedia: The term "redlining" ... describes the practice of marking a red line on a map to delineate the area where banks would not invest). 98% of 10 million loans guaranteed by the FHA went to whites.
Court cases in 1948 and 1953 struck down the policy but the practice, known as redlining, continued. In 1977, the Community Reinvestment Act tried to end the bias - it demanded that banks serve the communities from which they receive deposits, and undertake regular audits of their practice to ensure compliance.
Initially banks fought the CRA but in the 1980s they realized they could profit from it by providing subprime loans to a clientele they had previously failed to serve. The practice grew slowly. In 1994 only 5% of all new mortgages were subprime; by 2004 20% of home loans were subprime, and in 2006 50% of all new and refinancing home loans were subprime.
States that tried to head off the subprime lending by requiring 'tangible net benefits' statements to be issued by the lender were subjehttp://www.blogger.com/img/gl.link.gifct to intense and costly lobbying pressure to desist - political donations, boycott threats and the like. Only in North Carolina did such regulation survive - and now North Carolina is one of the states least affect by the foreclosure crisis.
Once again racism and attempts to get beyond it confound us.
Kai Wright, The Subprime Swindle, The Nation, July 14 2008
http://www.thenation.com/doc/20080714/wright
Before World War 2 less than 50% of US households owned their homes. By 1960 this had risen to nearly 65%, an increase fueled by deliberate government policy.
The Federal Housing Administration lowered the cost of buying homes by extending mortgage insurance, allowing banks to lend money at less risk and therefore at better terms to borrowers. Banks could now extend 30 year mortgages covering 80-90% of the buyer's cost at 6% interest.
But it was explicitly a whites only policy, guided by an FHA rule limiting loan underwriting to segregated white neighborhoods, a practice known as redlining. (Wikipedia: The term "redlining" ... describes the practice of marking a red line on a map to delineate the area where banks would not invest). 98% of 10 million loans guaranteed by the FHA went to whites.
Court cases in 1948 and 1953 struck down the policy but the practice, known as redlining, continued. In 1977, the Community Reinvestment Act tried to end the bias - it demanded that banks serve the communities from which they receive deposits, and undertake regular audits of their practice to ensure compliance.
Initially banks fought the CRA but in the 1980s they realized they could profit from it by providing subprime loans to a clientele they had previously failed to serve. The practice grew slowly. In 1994 only 5% of all new mortgages were subprime; by 2004 20% of home loans were subprime, and in 2006 50% of all new and refinancing home loans were subprime.
States that tried to head off the subprime lending by requiring 'tangible net benefits' statements to be issued by the lender were subjehttp://www.blogger.com/img/gl.link.gifct to intense and costly lobbying pressure to desist - political donations, boycott threats and the like. Only in North Carolina did such regulation survive - and now North Carolina is one of the states least affect by the foreclosure crisis.
Once again racism and attempts to get beyond it confound us.
Kai Wright, The Subprime Swindle, The Nation, July 14 2008
http://www.thenation.com/doc/20080714/wright
fear of terrorism greatly exaggerated
I am still puzzling over why so many well informed and sensible people are struggling under the fear of terrorism. Apart from its value as political scare tactic, the rationale for buying into this phenomenon seems so thin. While the audacity and visual horror of the fall of the twin towers is all too real and the death toll tragic, why does this event seem to so many to be unique?
Was 9/11/01 the bloodiest day in US history? NO
September 17, 1862: the battle of Antietam: 5000 men dead, nearly 20,000 wounded - of whom 10% (another 2000) would soon die. (1)
Was this the first 'spectacular' terrorist attack in the US? NO
On April 19, 1995, a massive bomb inside a rental truck exploded, blowing half of the nine-story building into oblivion... When the smoke cleared and the exhausted rescue workers packed up and left, 168 people were dead in the worst [at that time] terrorist attack on U.S. soil. (2)
Was the attack on 9/11/01 the deadliest attack on a civilian population? NO
On August 6 1945, the city of Hiroshima was destroyed by the first atomic bomb used in warfare. The initial blast toppled the city, maiming and killing tens of thousands, but the radiation unleashed by the atomic bomb inflicted countless more with radiation poisoning. Within four months between 90,000 and 140,000 people of the city's population of 310,000 are estimated to have died. About one-third of Nagasaki City was destroyed three days later, leading to the deaths of 60,000-80,000 of its population of 250,000 within four months, the destruction of 18,000 houses in the city and over an area of 6.7 million square meters. For the following ten years many of the survivors, especially those exposed as children, suffered excess risk of leukemia. The excess risk for cancers other than leukemia continues today, and it seems likely that this will persist throughout the lifetime of the survivors. (3)
Another deadly day: Bhopal, India, December 3 1984
A runaway reaction at the Union Carbide chemical factory in Bhopal led to the release of lethal gases. Poison clouds from the Union Carbide factory enveloped an arc of over 20 square kilometers before the residents could run away from its deadly hold. The leak killed over 8,000 people in its immediate aftermath and caused multi-systemic injuries to over 500,000 people. (4)
Unnecessary death every day
Road traffic crashes kill about 43,000 Americans (approximately the population of Chapel Hill) per year (3). World-wide 3,000 people are killed in road traffic daily and about 30,000 more disabled. That is 1 million deaths, 10.9 million injured. (5)
All unnecessary deaths are tragic. Are those killed in terrorist attacks in New York and Washington D.C. more tragic than those killed on the roads, murdered by guns, or dead from atomic bombing or industrial carelessness? Or those who die from hunger, treatable illness, or exposure through homelessness? Not in MY book.
Sources:
1. David Remnitz and Hendrik Hertzberg, "A Year After", New Yorker, 9/16/02
2. www.cnn.com/US/OKC/bombing.html
3. Radiation Effects Research Foundation, http://www.rerf.or.jp/top/orge.htm
4. NICHOLAS D. KRISTOF, Op-Ed Column NYT, August 18, 2004 and from NPR 6/15/03
5. Ian Roberts, professor of epidemiology and public health at the London School of Hygiene and Tropical Medicine
posted by quixote at 3:31 PM 0 comments
Was 9/11/01 the bloodiest day in US history? NO
September 17, 1862: the battle of Antietam: 5000 men dead, nearly 20,000 wounded - of whom 10% (another 2000) would soon die. (1)
Was this the first 'spectacular' terrorist attack in the US? NO
On April 19, 1995, a massive bomb inside a rental truck exploded, blowing half of the nine-story building into oblivion... When the smoke cleared and the exhausted rescue workers packed up and left, 168 people were dead in the worst [at that time] terrorist attack on U.S. soil. (2)
Was the attack on 9/11/01 the deadliest attack on a civilian population? NO
On August 6 1945, the city of Hiroshima was destroyed by the first atomic bomb used in warfare. The initial blast toppled the city, maiming and killing tens of thousands, but the radiation unleashed by the atomic bomb inflicted countless more with radiation poisoning. Within four months between 90,000 and 140,000 people of the city's population of 310,000 are estimated to have died. About one-third of Nagasaki City was destroyed three days later, leading to the deaths of 60,000-80,000 of its population of 250,000 within four months, the destruction of 18,000 houses in the city and over an area of 6.7 million square meters. For the following ten years many of the survivors, especially those exposed as children, suffered excess risk of leukemia. The excess risk for cancers other than leukemia continues today, and it seems likely that this will persist throughout the lifetime of the survivors. (3)
Another deadly day: Bhopal, India, December 3 1984
A runaway reaction at the Union Carbide chemical factory in Bhopal led to the release of lethal gases. Poison clouds from the Union Carbide factory enveloped an arc of over 20 square kilometers before the residents could run away from its deadly hold. The leak killed over 8,000 people in its immediate aftermath and caused multi-systemic injuries to over 500,000 people. (4)
Unnecessary death every day
Road traffic crashes kill about 43,000 Americans (approximately the population of Chapel Hill) per year (3). World-wide 3,000 people are killed in road traffic daily and about 30,000 more disabled. That is 1 million deaths, 10.9 million injured. (5)
All unnecessary deaths are tragic. Are those killed in terrorist attacks in New York and Washington D.C. more tragic than those killed on the roads, murdered by guns, or dead from atomic bombing or industrial carelessness? Or those who die from hunger, treatable illness, or exposure through homelessness? Not in MY book.
Sources:
1. David Remnitz and Hendrik Hertzberg, "A Year After", New Yorker, 9/16/02
2. www.cnn.com/US/OKC/bombing.html
3. Radiation Effects Research Foundation, http://www.rerf.or.jp/top/orge.htm
4. NICHOLAS D. KRISTOF, Op-Ed Column NYT, August 18, 2004 and from NPR 6/15/03
5. Ian Roberts, professor of epidemiology and public health at the London School of Hygiene and Tropical Medicine
posted by quixote at 3:31 PM 0 comments
what it's about
Just the facts ma’am
I get tired of all those news stories that are filled with anecdotes and personal histories and color – and yeah, I don’t much like color commentaries when I’m listening to ballgames either. So I tend to go through the stories and pull out the data that I find useful. That’s what I intend to do here – to cannibalize (with full attribution) news articles and other stuff that I read and learn from and pass along the facts digest. For anyone who wants the full context I’ll provide the reference.
Out of context
On the other hand there are times when news headlines provide sound bytes that distort the original statement. In those cases I like to search for the original and do a fuller search for the meaning intended.
Way out there
Then there's the stuff that makes me mad, and I intend to put it out there.
I get tired of all those news stories that are filled with anecdotes and personal histories and color – and yeah, I don’t much like color commentaries when I’m listening to ballgames either. So I tend to go through the stories and pull out the data that I find useful. That’s what I intend to do here – to cannibalize (with full attribution) news articles and other stuff that I read and learn from and pass along the facts digest. For anyone who wants the full context I’ll provide the reference.
Out of context
On the other hand there are times when news headlines provide sound bytes that distort the original statement. In those cases I like to search for the original and do a fuller search for the meaning intended.
Way out there
Then there's the stuff that makes me mad, and I intend to put it out there.
the price of a child
This is one of several posts originally on a site I can no longer access - here for the record.
Monday, August 30, 2004
I heard Rick Santorum interviewed by Terry Gross today.
He told a sad but inspiring story of the birth and death of a baby son, whose endangered existence he and his wife chose not to terminate during her pregnancy. Despite intrauterine surgery, however, the baby was born prematurely and lived only two hours. Yet, according to the Senator, this life had its purpose, was part of God's plan. While I heard his story with sympathy, I couldn't help wondering - does the Seantor feel the same way about all the other endangered babies and children in the world - the starving, those sick with diseases which could be cured at a fraction the cost of the surgery performed on his son, those driven from homes in Darfur or killed in bombing in Iraq - or are their lives too all part of the plan?
Or is Senator Santorum's son in some way special? Just one example:
Malaria kills over 800 children every minute in sub-Saharan Africa. It is Africa's greatest single cause of child mortality; survivors suffer lifelong anemia, cognitive impairment and fatigue. It costs Africa $12 billion per year. It could be eradicated in 5 years. GlaxoSmithKline has already tested a prototype vaccine - but market forces are insufficient to drive this to market. Meanwhile the profit margins of pharmaceutical companies are 20% (compared to normal corporate profit levels of 3%. (1)
Would Senator Santorum consider supporting some non-market driven response to save the lives of these children? Or is that not in the plan?
Source" Indypendent news (NYC) 11/3/03, from a World Health Organization report, July 2003. See also malariavaccine.org and also emvi.org (European mvi).
Monday, August 30, 2004
I heard Rick Santorum interviewed by Terry Gross today.
He told a sad but inspiring story of the birth and death of a baby son, whose endangered existence he and his wife chose not to terminate during her pregnancy. Despite intrauterine surgery, however, the baby was born prematurely and lived only two hours. Yet, according to the Senator, this life had its purpose, was part of God's plan. While I heard his story with sympathy, I couldn't help wondering - does the Seantor feel the same way about all the other endangered babies and children in the world - the starving, those sick with diseases which could be cured at a fraction the cost of the surgery performed on his son, those driven from homes in Darfur or killed in bombing in Iraq - or are their lives too all part of the plan?
Or is Senator Santorum's son in some way special? Just one example:
Malaria kills over 800 children every minute in sub-Saharan Africa. It is Africa's greatest single cause of child mortality; survivors suffer lifelong anemia, cognitive impairment and fatigue. It costs Africa $12 billion per year. It could be eradicated in 5 years. GlaxoSmithKline has already tested a prototype vaccine - but market forces are insufficient to drive this to market. Meanwhile the profit margins of pharmaceutical companies are 20% (compared to normal corporate profit levels of 3%. (1)
Would Senator Santorum consider supporting some non-market driven response to save the lives of these children? Or is that not in the plan?
Source" Indypendent news (NYC) 11/3/03, from a World Health Organization report, July 2003. See also malariavaccine.org and also emvi.org (European mvi).
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