Monday Reads: “Christmas Is At Our Throats Again.”

Matisse woman reading2

Good Morning!!

It’s only 10 days until Christmas, and I really can’t wait until the whole dreadful thing is over and we can go back to normal life. Even though I generally ignore “the holidays,” no one can really avoid being affected by the insanity of it all.

On Sunday, The New York Times published a piece about the empty feeling so many people have at this time of year. The author is Arthur C. Brooks of the {gag!} American Enterprise Institute, but I’m trying to ignore that too for the moment. He opens with a supposed quote from Noel Coward: “Christmas is at our throats again.” I can’t believe I’ve never heard it before.

Abundance Without Attachment

“Christmas is at our throats again.”

That was the cheery yuletide greeting favored by the late English playwright Noël Coward, commemorating the holiday after which he was named. Less contrarian were the words of President Calvin Coolidge: “Christmas is not a time nor a season, but a state of mind. To cherish peace and good will, to be plenteous in mercy, is to have the real spirit of Christmas.”

Which quotation strikes a chord with you? Are you a Coward or a Coolidge?

If you sympathize more with Coward, welcome to the club. There are many more of us out there than one might expect. A 2005 survey by the Pew Research Center found that more than half of Americans were bothered “some” or “a lot” by the commercialization of Christmas. A 2013 follow-up confirmed that materialism is Americans’ least favorite part of the season.

Call it the Christmas Conundrum. We are supposed to revel in gift-giving and generosity, yet the season’s lavishness and commercialization leave many people cold. The underlying contradiction runs throughout modern life. On one hand, we naturally seek and rejoice in prosperity. On the other hand, success in this endeavor is often marred by a materialism we find repellent and alienating.

Read the rest if you’re interested. I have some issues with the author’s point of view; if he’s really into nonattachment, why is he employed by the AEI?

wise men

I also came across this piece from last December 20 in The New Republic. It’s a reprint of an essay from 1990 by James S. Henry.

Why I Hate Christmas

Although for many years Christmas has been justified on the grounds that it is “merry,” rigorous quantitative analysis establishes that the opposite is the case. Despite claims advanced by proponents that the holiday promotes a desirable “spirit,” makes people “jolly,” etc., the data show that the yuletide time period is marked by environmental degradation, hazardous products and travel, andperhaps most importantinefficient uses of key resources. The holiday is an insidious and overlooked factor in America’s dwindling savings rates, slack worth ethic, and high crime rates. Nor does Christmas truly fulfill its purported distributional objective: the transfer of gifts to those who need them. Moreover, the number of people rendered “joyous” by Christmas is probably equaled or excelled by the number made to feel rather blue. In short, as shown below, although Christmas is an important religious observance that provides wintertime fun for children (who would probably be having fun anyway), it fails the test of cost-effectiveness.

Christmas consumes vast resources in the dubious and uncharitable activity of “forced giving.” First, it is necessary to factor in all the time spent searching for “just the right gifts,” writing and mailing cards to people one ignores the rest of the year, decorating trees, attending dreary holiday parties with highly fattening, cholesterol-rich eggnog drinks and false cheer, and returning presents. Assuming conservatively that each U.S. adult spends an average of two days per year on Christmas activities, this represents an investment of nearly one million person-years per season. Just as important is the amount that Americans spend on gratuitous gifts each year$40 billion to $50 billion, according to the U.S. Commerce Department’s monthly retail trade sales. Extra consumer spending is often considered beneficial because it stimulates the economy, but the massive yuletide spike creates numerous harmful externalities.

Mistargeted giving is one indication of this waste. According to New York department stores, each year about 15 percent of all retail dollar purchases at Christmas are returned. Allowing for the fact that many misdirected gifts are retained because people feel obliged to keep them (such as appliances, tablecloths, etc., which must be displayed when the relative who gave them to you comes for a visit), and allowing for the widespread inability of children to return gifts, this indicates that up to a third of purchases may be ill-suited to their recipients. Christmas is really a throwback to all the inefficiencies of the barter economy, in which people have to match other people’s wants to their offerings. Of course, money was invented precisely to solve this “double coincidence of wants” problem. One solution would be to require people to give each other cash as presents, but that would quickly reveal the absurdity of the whole institution.

“Forced giving” also artificially pumps up consumption and reduces savings, since it is unlikely that all the silly and expensive presents given at Christmas would be given at other times of the year. One particularly noxious aspect of Christmas consumption is “conspicuous giving,” which involves luxury gifts such as Tiffany eggs, crystal paperweights, and $15,000 watches that are designed precisely for those who are least in need of any present at all (“the person who has everything”). Most such high-priced gifts are given at Christmas; the fourth quarter, according to a sampling of New York department stores, provides more than half the year’s diamond, watch, and fur sales.

Read the rest at the link. The points are actually more relevant today in the era of the new Robber Barons than it was in 1990.

Xmas-is-evil-1-640x480

Now to the news of the day.

A hostage crisis developed in Sydney Australia yesterday and it is still going on. One armed man was holding as many as 15 hostages inside the Lindt Chocolat Cafe. There appears to be some connection with Islamic terrorism, but it’s not clear yet if this is a lone wolf or or someone actually connected to the Islamic State. From the Sydney Morning Herald:

Efforts by police to negotiate a peaceful end to a siege of a cafe in the heart of Sydney’s CBD are continuing well into the night.

Police said they are dealing with an armed man, who has been holding an undisclosed number of hostages at the Lindt Chocolat Cafe in Martin Place since about 9.45am.

Police Commissioner Andrew Scipione told an evening media conference that police were in contact with the suspected gunman, adding that “we are only dealing with one location”.

“Our plan, our only goal tonight is to get those people who are currently caught in that building, out of there,” Mr Scipione said. “Rest assured, we are doing all we can to set you free.”

Some hostages have now escaped. There’s lots more information at that link.

More from the LA Times:

Prime Minister Tony Abbott confirmed late Monday that the gunman appeared to have “a political motivation,” and local media reported that the gunman was trying to obtain an Islamic State flag in exchange for some of the hostages.

Two people inside the cafe had been seen pressed up against the window holding a black flag with Arabic writing early in the siege, which began about 9:45 a.m. local time. The flag appeared to say: “There is no god but Allah, and Muhammad is the messenger of God.”

The gunman claimed to have planted four bombs, two inside the cafe, and two elsewhere in Sydney, local media reported. Authorities declined to “speculate” about reports of explosives.

“I can’t speculate on what may or may not be, and that would be very unhelpful at the moment,” Deputy Police Commissioner Catherine Burn said at an evening news conference. “At the moment we know that the person we are dealing with is armed.”

She declined to call the incident a terrorist act. “We still don’t know what the motivation might be,” she said, adding that authorities “want to resolve this peacefully.”

christmas-music

Sony Pictures is warning media outlets not to publish their hacked e-mails. From The Washington Post: 

After days of silence, Sony Pictures Entertainment acknowledged a voluminous, embarrassing leak of internal e-mails and other materials on Sunday, warning numerous media outlets in a strongly worded letter against publishing or using the “stolen” corporate data exposed by unidentified hackers.

The materials, particularly e-mails, provided an extraordinary glimpse inside one of the world’s best-known corporations. The initial stories based on the materials went viral and absorbed days of coverage last week, illuminating the high-powered dealings, petty squabbling and ego that can define Hollywood.

The company threatened legal action against news organizations that failed to heed its request, a strategy some legal scholars say would have a rough time passing muster under the First Amendment, which protects freedom of the press. Though no one has accused any news organization of participating in the theft, the letter appears to be a gambit to stop news outlets from reporting the documents.

Sony’s action came just as the hackers, who call themselves the “Guardians of Peace” reportedly threatened another dump of stolen data. The hackers have demanded the company withdraw an upcoming comedy based on a fictional plot to assassinate North Korean leader Kim Jong Un.

So the rumors that the hackers are from North Korea is true then?

The contents of the leaked data, which some analysts suspect may be linked to a North Korean regime furious over the release of Sony’s movie “The Interview,” included information on Sony’s salaries, business dealings, private health records and executive correspondence. Those letters revealed what’s been described in media reports as a racially insensitive conversation involving President Obama and disparaging remarks about some of Hollywood’s biggest actors, including Angelina Jolie and Leonardo DiCaprio.

There’s much more at the WaPo link.

google-hates-christmas-300x300

After Elizabeth Warren’s speech in the Senate last week, many in the media are stepping up their efforts to get Warren to challenge Hillary Clinton for the 2016 Democratic nomination. It’s truly horrifying–almost an exact repeat of what happened in 2008 when the progs who now hate Obama’s guts–and eventually the Democratic establishment and the meda–handed the nomination to Obama, a candidate with only two years’ experience in the Senate. Obama at least had some political experience as a state legislator; Warren doesn’t even have that. And where would the money come from?

Some links to explore:

Wonkblog: Elizabeth Warren was told to stay quiet, but she didn’t – and it’s paying off.

WBUR Boston (NPR): Sen. Warren Warns That Spending Bill Sets Dangerous Precedent.

Huffington Post: The Speech That Could Make Elizabeth Warren the Next President of the United States.

Don’t get me wrong; I applaud what Warren is doing. But do we really want to nominate another presidential candidate based on one speech?

There’s been another police involved shooting of an unarmed black man–this time in Houston.

From the Houston Chronicle: Police: Man shot during traffic stop in southwest Houston.

Two police officers opened fire on an apparently unarmed man during a traffic stop in southwest Houston Friday night, allegedly shooting him three times for not following commands.

HPD officers pulled over the car the man was a riding in for an illegal lane change around 9:30 p.m. on Buffalo Speedway near West Fuqua.

According to authorities, the male passenger — identified by family as 38-year-old Michael Paul Walker — failed to obey orders and started to reach under his car seat.

“They saw the doors open up, one of the officers gave repeated verbal commands to stay inside the vehicle, then the officer went to brace the door to keep him (the passenger) inside,” said Houston Police Department spokesman Victor Senties. “At one point he had his arm all the way under the seat, right up to the elbow, as if he was trying to grab something … The officer gave him commands to show his hands … at that point the officer was in fear of his life and that of his partner.”

The officer fired at the man. Initial reports suggest that Walker then got out of the car and was walking around the parking lot of a convenience store before he was shot again.

“The suspect got out of the vehicle … he was digging into his pockets and waist band,” said Senties, adding that the second officer also shot the suspect.

Yeah, whatever. I don’t believe anything cops say anymore.

image_5647

Raw Story has a report from a witness to the shooting: Bystanders plead with unarmed black man to ‘lay down’ after Houston police repeatedly shoot him.

Laquesha Spencer told Local 2 that she was yelling at Walker, “‘Lay down, they are going to shoot you. They are going to kill you.’ And I guess he was in shock, he had already been shot three times, because I heard multiple gunshots.”

As Walker was stripping down, the partner of the officer who first shot him opened fire, striking him again. Police then charged and handcuffed Walker, who was taken to the hospital where he is listed in serious, but stable, condition.

Walker’s sister, Laura, said she believes the police used excessive force and is already pursuing legal action. “He didn’t even have a gun,” she said, “he’s never owned a weapon.”

At least this police shooting victim is in the hospital, not dead.

Also from Raw Story, an update on events surrounding the police shooting of John Crawford for holding a toy gun in an Ohio Walmart store: Ohio cop threatens sobbing girlfriend with jail after police gun down man in Walmart.

Police aggressively questioned the tearful girlfriend of a young black man they had just shot dead as he held a BB gun in an Ohio supermarket – accusing her of lying, threatening her with jail, and suggesting her boyfriend had planned to shoot the mother of his children.

Tasha Thomas was reduced to swearing on the lives of her relatives that John Crawford III had not been carrying a firearm when they entered the Walmart in Beavercreek, near Dayton, to buy crackers, marshmallows and chocolate bars on the evening of 5 August.

“You lie to me and you might be on your way to jail,” detective Rodney Curd told Thomas, as she wept and repeatedly offered to take a lie-detector test. After more than an hour and a half of questioning and statement-taking, Curd finally told Thomas that Crawford, 22, had died.

“As a result of his actions, he is gone,” said the detective, as she slumped in her chair and cried.

I’ll end there. I have a few more links for you that I’ll post in comments. What stories are you following today?


Lazy Saturday Reads: Serious and Silly Boston News

Harbor view of Boston

Harbor view of Boston

Good Morning!!

I’m going to imitate Dakinikat and “go local” today. I’m so sick and tired of the national news–school shootings, the campus rape problem, big banks controlling Congress, and “journalists” trying to force Elizabeth Warren to run for president so they can spend the next two years humiliating Hillary Clinton. Oh, and calling Warren the “Ted Cruz of the left”?!

Maybe you heard about this already, but I just think it’s so cool. The old Massachusetts State House in Boston (built in 1713) has been undergoing renovations recently. In October, workers found a time capsule dating from 1901 inside the head of a copper lion statue that, along with a statue of a unicorn was perched on top of the old building.

From CNN: 113-year-old time capsule found in Boston.

The Bostonian Society didn’t — or couldn’t — fully divulge the 113-year-old time capsule’s contents, explaining that “the process of extracting documents that are old and probably fragile will need to be slow and careful.” But a Boston Globe article from February 24, 1901, detailed what went into the box, which the story predicted would “prove interesting when the box is opened many years hence.”

According to the Globe, the box included the photographs and autographs of local statesmen such as Massachusetts Gov. Winthrop M. Crane and Boston Mayor Thomas Norton Hart, as well as news clippings of the day from several city newspapers and even a “letter to posterity from the reporters of the Boston Daily newspapers assigned to City Hall.”

It also included a photograph of the “5th Massachusetts Regiment on its way to Framingham to be mustered in as U.S. volunteers for service in the war against Spain,” as well as “campaign buttons for McKinley, Roosevelt and John D. Long for vice president.”

The box was sealed inside the lion’s head by Samuel Rogers, a local coppersmith who was part of the crew renovating the nearly 200-year-old State House. Although the occasion was detailed in the city’s largest newspaper, the Bostonian Society said its current staff was unaware of the time capsule until they received a letter from a descendent [sic] of Rogers alerting them to it.

The lion and unicorn statues, now freshly coated in gold and palladium, were returned to their posts of more than 100 years. Pictured: The unicorn statue. (h/t The Boston Globe)

The lion and unicorn statues, now freshly coated in gold and palladium, were returned to their posts of more than 100 years. Pictured: The unicorn statue. (h/t The Boston Globe)

The lion and unicorn statues were restored and returned to the top of the old State House in November.

On Thursday, another time capsule was unearthed in Boston–this at the new State House–and it was put there more than 200 years ago.

From The Boston Globe:  Revere-Era Time Capsule Uncovered at The State House.

The 219-year-old capsule— a green box believed to contain Revere-era items— was concealed by Governor Samuel Adams, Paul Revere, and William Scollay when the building was constructed in 1795….

Museum of Fine Arts Conservator Pam Hatchfield was chipping away at the stone block concealing the capsule this morning when the coins fell from the cornerstone. Reporters at the site described one of the coins as “silver-colored” but “not legible.” The box, which was discovered during building maintenance, is expected to be completely unearthed by Thursday afternoon.

But this isn’t the first time the capsule has surfaced. The Boston Globe reported that the box was discovered amidst emergency repairs to the building in 1855, and was returned to its spot following the construction, remaining unopened.

Massachusetts officials worked to remove a time capsule in the cornerstone of the State House in Boston, on Dec. 11, 2014 (h/t The Boston Globe).

Massachusetts officials worked to remove a time capsule in the cornerstone of the State House in Boston, on Dec. 11, 2014 (h/t The Boston Globe).

More details from another Globe article from Thursday:

After a full day spent lying on her back on a muddy wooden plank, chipping with painstaking care at the underside of a stone block to free the time capsule hidden within, Museum of Fine Arts conservator Pam Hatchfield sat up in front of the State House to a round of applause, a green box held delicately in her hands.

“I feel happy and relieved. And excited. And really interested to see what’s in this box,” she said Thursday night, after posing for a selfie with the capsule for her mom. The extrication took more than seven hours and involved about a dozen workers….

“Hopefully there will be no damage and we will be able to observe the artifacts that trace us back to the history not only just of this building, but of our Commonwealth and our country,” said Secretary of State William Galvin, who was on hand for the capsule’s first appearance in more than 150 years.

The capsule is believed to include a collection of silver and copper coins dating from between 1652 and 1855; an engraved silver plate; newspapers; the seal of the Commonwealth; cards; and a title page from the Massachusetts Colony Records, according to Meghan Kelly, a spokeswoman for the Executive Office of Administration and Finance.

Hatchfield, who is head of Objects Conservation at the Museum of Fine Arts, said the corroded copper alloy box that holds the collection was undamaged by the removal process, and appeared to be in good shape. It was a little smaller than a cigar box and, she said, heavier than she expected.

The box was taken by State Police escort to the Museum of Fine Arts, where Hatchfield said it will be X-rayed to determine the contents.

There’s much more at the link if you’re interested. We should learn more about what is in the box next week. The box will eventually be reburied, perhaps with a few items from 2014 included.

See lots more photos at The Daily Mail: America’s oldest time capsule unearthed at Boston statehouse after being buried in 1795 by Sam Adams and Paul Revere. Below is a photo of Pam Hatchfield holding the box after she unearthed it.

1795 Time Capsule

 

A few more Boston stories–hope I’m not boring you too much.

Here’s why only rich people can afford to live in downtown Boston these days: Boston real estate assessments eclipse $100 billion for first time.

It’s official. Boston is a $100 billion city.

With the real estate market surging, the total estimated value of its residential and commercial property jumped over that threshold for the first time and has climbed to a total of $110 billion, according to a new city assessment.

The increase will mean significantly higher tax bills for many property owners next year, although the extent of those increases will not be known until tax rates are set in the coming days….

In total, the assessed value of the city’s real estate has more than doubled in 12 years.

Although Boston has some of the highest-priced property in the country, its total value remains much lower than larger cities such as New York, where assessors tabulated more than $900 billion in property last year.

Still, Boston is growing at a rapid clip, with millions of square feet of buildings under construction. Commercial and residential real estate markets have come alive. More than $10 billion in commercial buildings changed hands during the first nine months of the year, according to the real estate firm JLL. That’s already more than double the $4.7 billion sold last year.

A similar pattern has occurred in the residential market, with prices rising sharply in many neighborhoods. The average selling price of condominiums in the downtown Boston area rose to $830,000 this fall, a 16 percent increase from a year earlier.

So for the superrich, the economy is surging in Boston, but it will be difficult for small businesses to keep paying their rising property tax bills.

Prof. Ben Edelman, Harvard Business School

Prof. Ben Edelman, Harvard Business School

Here’s really silly Boston story–so ridiculous that it made the national news.

From USA Today: Harvard prof flips over $4 Chinese food overcharge.

A Boston-area Chinese restaurant charging $1 more per plate than it advertises on its online menu may have served the wrong guy — a Harvard Business School professor specializing in online advertising fraud who wasted no time in pulling out the Massachusetts Consumer Protection Statute and threatening legal action. According to a lengthy e-mail exchange published by the Boston Globe, Ben Edelman is seriously agitated, and though the mom-and-pop shop only overcharged him $4, he says it’s the principle….

The restaurant, Sichuan Garden, appears to have thus far complied with Ben Edelman’s requests, including refunding him $12 (three times what he was overcharged) and updating the online menu to reflect actual prices. Ran Duan, who tends bar at the restaurant for his parents, recently told Boston.com:

“I personally respond to every complaint and try to handle every situation personally. … I have worked so hard to make my family proud and to elevate our business. [This exchange] just broke my heart.”

This battle actually escalated to the point where Edelman threatened a lawsuit against the restaurant unless they refund three times the amount they had overcharged him.

Ran Duan at Sichuan Garden II

Ran Duan at Sichuan Garden II

Globe columnist Hilary Sargent published the exchange of e-mails between Edelman and Duan in this article: Ben Edelman, Harvard Business School Professor, Goes to War Over $4 Worth of Chinese Food. Next, Sargent found out that Edelman “Did This Before, And Worse.”

Boston.com received a tip from a “former manager” of a “Back Bay sushi restaurant,” who stated that he had read the Edelman email exchange published on this site, and that when “it sounded familiar” he realized he had seen a similar email exchange several years prior.

The restaurant manager declined to give his name or the name of the restaurant, but described both emails and phone calls with Ben Edelman over a dispute related to the use of a Groupon promotion.

We were then sent copies of several emails exchanged in August 2010 between Ben Edelman and Osushi Restaurant management.

Boston.com confirmed the authenticity of these emails with Tim Panagopoulos, one of three partners who owned and operated Osushi, which has since closed.

Check out those e-mails at the above link.

Edelman has now apologized to Ran Duan for his snit fit and Duan says he’s ready to “forgive and move on.”

Next, Hilary Sargent ran into trouble. From BostInno on Thursday: The HBS Professor Chinese Food Saga Took a Weird Turn Last Night.

Harvard Business School Professor Ben Edelman may have gone way, way too far over a $4 billing mistake at Brookline Chinese restaurant Sichuan Garden. But on Wednesday evening, Boston.com posted an article claiming it appeared that Edelman—after apologizing for his actions on his website—may have taken things into far more shameful territory by sending a message to the restaurant containing a racial slur.

boston-coms-hilary-sargent-is-suspended-for-harvard-t-shirt-incident

Ooops! Turns out Sargent hadn’t actually confirmed that the slur came from Edelman. On top of that Sargent (who is somewhat young and inexperienced) had a T-shirt made that mocked the HBS prof. That was apparently too much for the Globe, and Sargent has been suspended for a week.

Boston.com deputy editor Hilary Sargent has been suspended for one week in connection with a T-shirt she designed—and then tweeted about—that mocked a Harvard Business School professor at the center of an ongoing story she was covering.

That’s the word from multiple sources familiar with the decision.

Word is that the suspension isn’t related to an article that Sargent retracted on Wednesday with an acknowledgment that its facts couldn’t be verified. Details weren’t immediately available about whether the suspension comes with pay or not.

Both the retracted article and the T-shirt pertained to Harvard Business School professor Ben Edelman and his long-winded reaction to a billing mix-up at a Brookline restaurant, Sichuan Garden. Sargent posted the initial story on the incident as well as a series of follow-up articles, which have had wide readership.

One more silly Boston story and then I’m done. Actress Amy Poehler, who grew up in the Boston area, told Buzzfeed that she thinks Boston accents are “just disgusting.”  Well, they are kind of grating, but after living here for close to 50 years, I’ve developed an affection for them. I think it’s interesting how each people in different sections of the city have slightly different accents. The same is true of people in the various cities and towns in Massachusetts. There is a distinctive Cambridge accent that differs slightly from the accents found in Somerville, Medford, or Malden.

According to The Boston Globe (via Medium), the Boston accent also won a “worst accent” competition at Gawker. 

I’ll be honest. I never heard of Amy Poehler until I read about this; and I don’t think I’d like her that much, because she also hates Halloween. She’s dead to me now.

I know there’s plenty of horrible news out there. Feel free to link to your favorite horror stories, and I’ll share a few of my own in the comment thread.

Have a great weekend, Sky Dancers!!

 

 


Monday Reads

10417565_10152492470668512_4269990371890197032_nGood Morning!

I attended a V to shining V party on Saturday night!  It was great to be out among active women’s rights advocates.  We also had some great snacks and games.  We got to “Pin the Probe on the Politician”.  Those pictures are of  Bobby Jindal, Bill Cassidy, and Rick Perry all appropriately pinned at various points.  I’m continuing my stump for Mary Landrieu and polls show that I’ve got to continue to work to find support and volunteers for her.

As Democratic Sen. Mary Landrieu defends her U.S. Senate seat in Louisiana, a new CNN/ORC International pollindicates the third-term incumbent carries a slim advantage over her closest GOP rival in the general election this November.

But this is Louisiana, and the election system can be complicated. There are nine candidates — Republicans, Democrats, and a Libertarian — on the ballot this November, and if no candidate crosses the 50% threshold, the race moves into a December runoff between the top two contenders.

Landrieu currently falls well below the 50% mark at 43% support among likely voters. Republican Rep. Bill Cassidy comes in second at 40%, according to the survey.

But the poll’s sampling error among likely voters is plus or minus four percentage points, meaning the two candidates are about even.

In a state with large swaths of conservative voters, Landrieu is considered one of the most vulnerable Democrats up for re-election this year. Republicans, eager to take control of the Senate, have focused on the race as a potential pick-up seat. The GOP needs a net gain of six seats to retake the majority.

If the horse race in Louisiana stays relatively the same, Landrieu and Cassidy would be the two candidates heading into the runoff — and that’s when things flip.

The poll indicates that Cassidy would fare slightly better in a runoff than Landrieu, 50%-47%.

“Keep in mind that the electorate in December is probably going to be smaller and quite a bit different from those who turn out to vote in November,” CNN Polling Director Keating Holland said.

503530d0aebbe96189605a1665207042I thought I’d bring up something that’s been intriguing me for a few days.  A whistle blower–Fed Employee–has pretty much charged the New York Fed with being captured by Goldman Sach’s. The story was first broke by ProPublica.   The woman was fired when she released a negative assessment of GS during an examination.

Barely a year removed from the devastation of the 2008 financial crisis, the president of the Federal Reserve Bank of New York faced a crossroads. Congress had set its sights on reform. The biggest banks in the nation had shown that their failure could threaten the entire financial system. Lawmakers wanted new safeguards.

This story was co-published with This American Life, from WBEZ Chicago.

Hear the radio version onthese stations or download the episode now.

The Federal Reserve, and, by dint of its location off Wall Street, the New York Fed, was the logical choice to head the effort. Except it had failed miserably in catching the meltdown.

New York Fed President William Dudley had to answer two questions quickly: Why had his institution blown it, and how could it do better? So he called in an outsider, a Columbia University finance professor named David Beim, and granted him unlimited access to investigate. In exchange, the results would remain secret.

After interviews with dozens of New York Fed employees, Beim learned something that surprised even him. The most daunting obstacle the New York Fed faced in overseeing the nation’s biggest financial institutions was its own culture. The New York Fed had become too risk-averse and deferential to the banks it supervised. Its examiners feared contradicting bosses, who too often forced their findings into an institutional consensus that watered down much of what they did.

The report didn’t only highlight problems. Beim provided a path forward. He urged the New York Fed to hire expert examiners who were unafraid to speak up and then encourage them to do so. It was essential, he said, to preventing the next crisis.

A year later, Congress gave the Federal Reserve even more oversight authority. And the New York Fed started hiring specialized examiners to station inside the too-big-to fail institutions, those that posed the most risk to the financial system.

One of the expert examiners it chose was Carmen Segarra.

Segarra appeared to be exactly what Beim ordered. Passionate and direct, schooled in the Ivy League and at the Sorbonne, she was a lawyer with more than 13 years of experience in compliance – the specialty of helping banks satisfy rules and regulations. The New York Fed placed her inside one of the biggest and, at the time, most controversial banks in the country, Goldman Sachs.

It did not go well. She was fired after only seven months.

78239661aea226e1a619dfe5907acdafSo,I should remind you that I used to work for Fed Atlanta.  I should also tell you that I’ve thought the NYC Fed has been a prime example of regulatory capture.  You can go back into the files to see my dissections of the 2005 financial crisis as well as read my contempt for Gaithner.  But, anyway, this story has legs, as they say so I wanted to share some updates.

Segarra found three clear cases where Goldman appeared to be engaged in wrongdoing, but where Fed staff pushed back at her attempts to correct it. The latter two incidents have audio evidence from Segarra’s recordings corroborating them.

The wealthy clients incident

A senior Goldman executive, at a meeting with Fed officials early in Segarra’s tenure, expressed the view that “once clients were wealthy enough, certain consumer laws didn’t apply to them,” in Bernstein’s words; this is corroborated by minutes from the meeting in questions. When Segarra tried to look into the issue further, a Fed colleague protested, saying the executive didn’t say that, or if he did, that he didn’t mean it.

The Santander incident

In early January, Goldman was closing a deal with the Spanish bank Santander, the point of which, Fed regulators discerned, was to take risky assets off of Santander’s hands so as to increase its ratio of capital to assets so as to comply with European regulators. The deal required Goldman to notify the Fed about the deal and get it to sign off, which Goldman hadn’t done.

While Fed officials, including Michael Silva, initially sounded outraged, in the end Silva only brought it up once, at the very end of a meeting with Goldman officials, and in a tone that Segarra found overly deferential. She thought the debrief from the meeting with other Fed officials suggested the Fed feared Goldman retaliation if they were too aggressive. This was despite the fact that Goldman was required to hand over information and the Fed could punish it, including criminally, if it failed to comply.

The most forceful action they considered taking against Goldman for the deal was sending them a letter; Bernstein couldn’t confirm that one was ever sent.

The conflict of interest policy incident

The Fed requires banks like Goldman to have firmwide conflict of interest policies that fit certain requirements. Segarra concluded that Goldman lacked such a policy, not least because Goldman’s staffer in charge of managing conflicts of interest told her the firm’s policy had no definition of “conflict of interest.”

Silva agreed with her. But after he got pushback from another Fed examiner, he changed his view, just as Segarra was about to take regulatory action to force Goldman to adopt a real policy. Silva protested that the bank had a conflict of interest policy, but Bernstein notes that it was “just a few paragraphs long and very general .… We showed it to two experts: former Fed examiners familiar with the Fed’s guidance on this issue. They both said it wouldn’t qualify as a policy.”

Silva urged her to recant her statement that there was no policy, despite the fact that he could have easily overridden her. Segarra suggests this was because, to quote Bernstein, “if she submitted her conclusions, it would create a formal record that her bosses didn’t want.” Eventually, Segarra agreed to say there was was a policy, albeit a “very poor policy,” but privately insisted to Silva that there was “no way this is a policy.” A week later, she was fired.

44edeedc4047d60ff7bc7c567123c6f5Elizabeth Warren–the senator at the right place, right time and with the right amount of expertise is calling for investigations.   Notice both the Senator and the Whistle Blower are outspoken,intelligent, and obviously moral women.493102324de33e96f3bf9180509c637f

An influential U.S. senator wants to hold hearings into “disturbing” issues raised by secretly taped conversations between Federal Reserve supervisors and officials at Goldman Sachs Group Inc <gs.n>, a bank the Fed was tasked with policing.

Elizabeth Warren, a Democrat on the Senate Banking Committee, on Friday called for hearings after portions of the recordings from 2011 and 2012 were made public. Fellow Democrat Sherrod Brown, also a committee member, called for a “full and thorough investigation” into the allegations they raised.

I’m hoping this does lead to an investigation and perhaps a call for changes in laws and the regulatory regime. I see that Sherrod Brown from Ohio has also called for congressional investigations.

Sens. Elizabeth Warren (D-Mass.) and Sherrod Brown (D-Ohio) are both calling for Congress to investigate the New York Federal Reserve Bank after recently releasedsecret recordings show the central bank allegedly going light on firms it was supposed to regulate.

Warren and Brown, both members of the Senate Banking Committee, called for an investigation of the New York Fed after Carmen Segarra, a former examiner at the bank, released secretly recorded tapes that she claims show her superiors telling her to go easy on private banks. Segarra says that she was fired from her job in 2012 for refusing to overlook Goldman’s lack of a conflict of interest policy and other questionable practices that should have brought tougher regulatory scrutiny.

Finally, a right wing forced birth zygote fetishist who will fess up to wanting to kill doctors, women, nurses, and any one else who might be associated with an abortion.  We’ve always known they were pro death penalty for any one that steps out side their narrow world.  The National Review’s Kevin D. Williamson  wants them all  “shot or hung”.

So this morning on Twitter, this happened; National Review writer Kevin D. Williamson made the real “pro-life” agenda very, very clear, expressing his opinion that women who have abortions should be put to death — by hanging. And not just the women; he says the doctor who performs the abortion, the nurses who assist, and the hospital staff who enable it should also be executed.

This was not satire, or a “joke.” He really believes this, as you’ll see if you read the following Twitter collection from the bottom up.

9a2b198c35ff84cdaf227edcc4d8c25aIs it more or they just getting more out there and obvious all the time?  I think they just want women to shut up and go away.  Oh, in an interesting turn of events ABC’s Martha Raddatz cut off Rick Perry in mid conspiracy theory rant.  Do you suppose they’re actually going make a practice of this?

ABC News host Martha Raddatz on Sunday cut off Texas Gov. Rick Perry (R) after he spent four minutes defending a conspiracy theory that President Barack Obama was plotting to fill up the United States with undocumented immigrants.

Speaking to Fox News last week, Perry had asserted that the president was responsible for the growing crisis of women and children immigrants coming across the border.

“We either have an incredibly inept administration, or they’re in on this somehow or another,” Perry opined. “I mean I hate to be conspiratorial, but I mean how do you move that many people from Central America across Mexico and then into the United States without there being a fairly coordinated effort?”
During a Sunday interview on ABC News, host Martha Raddatz gave the Republican governor a chance to back away from his conspiracy theory.

“Governor, do you really believe there’s some sort of conspiracy to get people into the United States by the federal government, by the Obama administration?” Raddatz asked.

“When I have written a letter that is dated May of 2012, and I have yet to have a response from this administration, I will tell you they either are inept or don’t care, and that is my position,” Perry said, doubling down on the theory. “We have been bringing to the attention of President Obama and his administration since 2010, he received a letter from me on the tarmac… I have to believe that when you do not respond in any way, that you are either inept, or you have some ulterior motive of which you are functioning from.”

The former Republican presidential candidate added that his theory was proved by the fact that the president had not responded to his letter, and had not deployed drones to the border.

“Unless we secure our southern border, this is going to continue to be a massive amount of individuals that are coming to the United States,” Perry warned. “And, frankly, we don’t have a place to house them as it is. And if we have a major event, a hurricane that comes in to the Gulf Coast, I don’t have a place to be housing people who are displaced because this administration…”

At that point, Raddatz interrupted Perry and ended the interview.

I will once again point out that it was MARTHA Raddatz and not GEORGE that stepped in and actually acted embarrassed to question an obviously whacked set of answers to a legitimate question.

 I think I’m finding a pattern of a need for b37c55da6efc35a1dbe229b5e49779d8more women in positions that matter.

So, that’s it for me this morning!  What’s on your reading and blogging list today?

 

 


Wednesday Reads

The Striped Towel, Marie Fox

The Striped Towel, Marie Fox

Good Morning!!

I’m finally back home in Greater Boston. Last night at around 5PM, I almost teared up when I saw the sign reading “Massachusetts Welcomes You,” with the little chickadee on it. I’m so torn, because I love Indiana too; but I’ve lived in Boston since 1967–47 years–and I love it here too!

Here I am, 66 years old, and I have no idea what to do with the rest of my life. Should I move back to Indiana where my mother lives or should I stay here where I’ve lived for most of my life? And will I even have a choice? I can’t stay where I’m living indefinitely, and there’s no way I can afford an apartment in the Boston area unless I manage to get into subsidized elderly housing. It would be much cheaper to to live in Indiana.

I have no idea what will happen, and I’m not sure how much control I’ll have over it anyway. I guess I just have to keep on truckin’ and try not to agonize too much about the future.

Anyway, the new continues onward no matter where I am. Here are some stories that caught my attention today.

Hillary on The Daily Show

On last night’s Daily Show, Jon Stewart tried to cajole Hillary Clinton into saying whether or not she’ll run for president in 2016. According to The Week, 

At the beginning of Tuesday night’s Daily Show, Jon Stewart states (almost) unequivocally that his guest, former Secretary of State Hillary Clinton, is declaring her candidacy for president in 2016 on his show. (Spoiler: She doesn’t.) But Clinton all but agrees with Stewart when he declares her candidacy for her, even knowingly answering all the right questions on his career aptitude test. If Clinton’s candidacy is supposed to be a long tease, maybe we’re approaching the denouement.

Clinton laughs a lot in the interview, and it’s clearly a friendly audience, but Stewart actually asks some interesting, tough questions. He also playfully tells her that nobody cares about her book, Tough Choices, and calls her out when she darts around his barbs. In fact, for somebody supposed to be a “terrible politician,” she fields the questions and turns around the criticism pretty skillfully.

Really? A “terrible politician?” That must be why she was elected to the Senate twice and why she won more primary votes than Barack Obama in 2008 (Yes, Virginian, Obama was nominated only with help from Superdelegate votes and Michigan Votes taken from Hillary and handed over to him by the Rules Committee.) In fact, she’s such a “terrible politician” than her former rival nominated her as his Secretary of State.

Sigh . . . Why don’t people actually watch and listen to Hillary herself instead of buying into the propaganda from her obsessed critics? Here is the Daily Show video from You Tube (I hope it doesn’t get taken down):

And BTW, “progressives,” getting Elizabeth Warren to run against Hillary for the nomination is a good recipe for electing Mitt Romney in 2016. From HuffPo: Ready For Warren Campaign Launches To Convince Elizabeth Warren To Run For President

WASHINGTON — An enthusiastic band of activists has launched a campaign to slow the momentum of Hillary Clinton and convince Sen. Elizabeth Warren (D-Mass.) that she should run for president in 2016.

“I think there’s an opportunity for us to convince her if we’re really able to make the case as to why we think she’s the right person,” said Erica Sagrans, who has signed on as the Ready For Warren campaign manager.

The group already has a Facebook pageTwitter account and a new website with a petition encouraging Warren to run.

Sagrans, who worked on President Barack Obama’s re-election campaign, will be joined by political activist Billy Wimsatt, who previously founded the League of Young Voters and is going to be a senior adviser to the new group.

Reached for comment, Lacey Rose, Warren’s press secretary, told HuffPost, “No, Senator Warren does not support this effort.”

I love Liz, but she had no political experience before running for the Senate two years ago, she is approximately the same age as Hillary, and she doesn’t have the connections to raise the necessary money. Please grow up or shut the fuck up, assholes.

beach reading1

Old Fogies of the GOP

At Vox, Matthew Yglesias asks, “How long can the GOP last as the cranky oldster party?”

You can tell it’s the dog days of summer because some of Washington’s finest minds are spending their time debating the inherently unknowable question of whether today’s teenagers will grow up to be Republicans. Jon Chait says no way, but Harry Enten and John Sides and David Leonhardt say maybe….

More interesting than asking whether people born in the 1990s will be voting GOP in the 2020s, I think, is asking what kind of a GOP it would have to be for them to vote for it. As an older member of the left-leaning youth cohort, I was really struck by something John Boehner said four summers ago. He complained that the Democratic majority that existed that summer, paired with Barack Obama, was “snuffing out the America that I grew up in.”

Boehner was born in 1949 and presumably isn’t nostalgic for the sky-high income tax rates (or strong labor unions) of his youth. So what was so great about it? The racial and gender discrimination? In practice, he probably didn’t have anything at all in mind — he’s just mixing up disagreement with aspects of the Democratic agenda (the specific issue under discussion was the Dodd-Frank financial regulation bill) with a generalized nostalgia for his youth. That probably resonates with a lot of older Americans, but while today’s teenagers might well turn against some of the failings of Obama-era liberalism, they’re unlikely to be pining for a return to Mad Men social norms….

There’s something very oldsterish about contemporary conservative politics. The constant bickering about Ronald Reagan is very odd to anyone too young to have any particular recollection of the Reagan years. Calling a group of people “Beyoncé Voters” as an insult is weird. Some of this oldsterism is just tics, but some of it has policy implications. The sort of budgetary priorities that call for huge cuts in all domestic spending, except no cuts at all for anyone born before 1959 is kind of weird. The huge freakout over New York City starting a bicycle program last summer was bizarre. It’s easy to imagine a political party that’s broadly favorable to low taxes and light regulation without sharing this particular set of tics. And then there was the time George Will wrote a column-length rant against blue jeans.

Not to mention Will’s wildly out-dated views on rape. Frankly, I think a lot of powerful Democrats are aging badly too. I’d like to see some of them move on and make room for some new blood. But let’s begin with the Republicans.

Beach Recliner, Candace Lovely

Beach Recliner, Candace Lovely

Speaking of cranky old folks, Dick Cheney has been all over the media lately, and I’ve had it up to here (point to neck).

From Politico: Cheney family sounds off after Iraq protests.

Former Vice President Dick Cheney on Monday defended the Bush administration’s decision to invade Iraq, calling it “absolutely the right thing to do.”

“I believed in it then, I look back on it now, it was absolutely the right thing to do,” the Wyoming Republican said with regard to the 2003 invasion of Iraq. Cheney made his comments at a POLITICO Playbook lunch conversation with his wife, Lynne, and daughter Liz at Washington’s Mayflower Renaissance Hotel, a lively event that featured jokes, a standing-room-only crowd and a few interruptions — protesters delayed the event twice, screaming at the former vice president for being a “war criminal.”

Notice the quotes around “war criminal,” as if that were hyperbole. I’m afraid not, Politico.

Mike Allen, POLITICO’s chief White House correspondent, began the event by asking Dick Cheney about his decision to lambaste the Obama administration over its foreign policy, particularly in contrast to former President George W. Bush, who has declined to criticize the president since he left office.

Citing a decades-long precedent of former presidents refusing to criticize their successors, Cheney said: “I’m not bound by those strictures.”

Of course not. Cheney has never been bound by any “strictures,” even as a young man when he managed to obtain five draft deferments while others his age were fight and dying in another pointless war he supported.

Solitude, Woman at the Beach, Rita C. Ford

Solitude, Woman at the Beach, Rita C. Ford

Fortunately, we have Charles Pierce: THINGS IN POLITICO THAT MAKE ME WANT TO MAINLINE ANTIFREEZE, PART THE INFINITY.

Its puerilty has finally crossed over into indecency. Its triviality has finally crossed over into obscenity. The comical political starfcking that is its primary raison d’erp has finally crossed over into $10 meth-whoring on the Singapore docks. Once a mere surface irritation, Tiger Beat On The Potomac has finally crossed over into being a thickly pustulating chancre on the craft of journalism. It has demonstrated its essential worthlessness. It has demonstrated that it has the moral character of a sea-slug and the professional conscience of theTreponema pallidum spirochete. Trust me. Stephen Glass never sunk this low. Mike (Payola) Allen has accomplished the impossible. He’s made Jayson Blair look like Ernie Pyle.

It’s not just that TBOTP invited the Manson Family of American geopolitics to come together for an exercise in ensemble prevarication. It’s not just that the account of said exercise is written in the kind of cacophonous cutesy-poo necessary to drown out the screams of the innocent dead, and to distract the assembled crowd from the blood that has dripped from the wallet of the celebrity war-criminal leading the public display. And it’s not as though this was a mere interview—a “get” that could help you “win the morning (!).” In that, it might have been marginally excusable. No, this was one of Mike Allen’s little grift-o-rama special events—a “Playbook lunch,” sponsored by that noted mortgage fraud concern Bank Of America. There’s an upcoming TBOTP “event” in L.A. that is sponsored by J.P. Morgan. I know what Mike Allen is, but I am so goddamn tired of haggling about the price. Here’s how TBOTP‘s own account of the event begins.

Sing it with us: “Here’s the story of a man named Cheney …” Dick, Lynne and Liz Cheney had a message they wanted to send with their appearance at POLITICO’s Playbook lunch on Monday: We’re a family, we’re happy together, we joke together, and we’re beating the drum for an aggressive foreign policy together. It’s almost as if the Cheneys were the Brady Bunch—if the Brady Bunch had started a hawkish think tank and were warning the country about the failures of President Barack Obama’s leadership around the world.

Yes, and if Mike were an authoritarian greed-monkey with a borrowed heart that he declined to employ in any meaningful sense, if Carol were a lifelong scold and nuisance pretending to be a historian, and if Marcia were a talentless clown who, if it weren’t for the largesse of Mike’s friends and their foundations, would be selling phony subprime packages to the blind from a strip-mall in Kannapolis. Also, whatever editor it was who passed on the tone of this account should be sent back to the oyster cannery where they found him.

Please go over to Esquire and read the whole thing. It’s highly therapeutic. And here’s another counterpoint from The New York Daily News: Dick Cheney interview drowned out by hecklers Monday in D.C.

Cheney also told Jake Tapper than he doesn’t think Republicans should try to impeach President Obama, even though he is “the worst president of my lifetime.” How magnanimous of dear old Dick!

 

 Other News . . .

MSNBC,  Obama admin to join voting rights cases in Ohio and Wisconsin.

Bob Cesca, Protesters Carrying Firearms March Against Immigrant Children in Michigan.

The Arizona Republic, Arizona politician mistakes ‘Y’ campers for migrant children.

Huffington Post,  Americans Are Too Stupid For GMO Labeling, Congressional Panel Says.

Jonthan Chait, Diane Ravitch: Campbell Brown Shouldn’t Worry Her Pretty Little Head About Education Policy.

 

What stories are you following today?


Tuesday Reads: Philippines Disaster, Economics News, and the Concern Troll Media

November snow1

Good Morning!!

Boy did I ever get a shock when I looked out my window this morning and saw a mix of snow and rain coming down outside. Noooooo! It’s way too early for winter weather. I hope this isn’t a sign of things to come.

Now that I’ve looked at this morning’s news from the Philippines, I’m ashamed to be complaining about a little bit of freezing rain. The disaster following Typhoon Haiyan is beyond belief. ABC News talked to a 19-year-old American woman who who survived the massive storm.

Rebecca Ruth Guy, 19, was living in the city of Tacloban, which bore the full force of the winds and the tsunami-like storm surges Friday. Most of the city is in ruins, a tangled mess of destroyed houses, cars and trees.

“When the storm hit, our apartment was flooding so we tried opening the door but the flooding was already rising up to our chest,” Guy told ABC News.

Faced with a life-and-death situation, Guy’s friend smashed the window so they could climb to the roof and escape the storm surge, which is being blamed for a large part of the destruction and death.

“We got out to the roof,” she said. “The rain was coming, the winds were crazy and it was getting cold. So we ended up sandwiching together and holding onto one another for warmth, praying for protection of the people.

“The most harrowing was when I saw women and children piled under tarpaulin, and when I saw dogs skewered on gates, cars thrown into buildings, people trying to find something to eat, water to drink,” she added.

According to the article, the U.S. sent planes to evacuate Americans living in the Philippines; other residents aren’t so fortunate.

CNN is reporting that 1,774 people are dead; but that number will continue to rise.

Cebu, Philippines (CNN) — Typhoon Haiyan has killed too many people to count so far and pushed to the brink of survival thousands more who have lost everything, have no food or medical care and are drinking filthy water to stay alive.

By Tuesday, officials had counted 1,774 of the bodies, but say that number may just be scratching the surface. They fear Haiyan may have taken as many as 10,000 lives.

The storm has injured 2,487 more since it made landfall six times last Friday, the government said. It has displaced at least 800,000 people, the U.N. said Tuesday.

Unfortunately a new storm and an earthquake have hindered rescue efforts.

As authorities rush to save the lives of survivors four days after Haiyan ripped the Philippines apart, a new tropical low, Zoraida, blew in Tuesday delivering more rain, the Philippine national weather agency PAGASA reported.

Zoraida is not a strong storm, but has dumped just under four inches of rain in some places, CNN meteorologists say….

An earthquake also rattled part of the affected area. The 4.8 magnitude temblor shook San Isidro Tuesday, the U.S. Geological Survey reported.

Here are a few more links about the storm and its aftereffects:

An aerial view of a coastal town in Samar province on Monday, Nov. 11. (REUTERS/Erik De Castro)

An aerial view of a coastal town in Samar province on Monday, Nov. 11. (REUTERS/Erik De Castro)

The Week: The terrible destruction of Typhoon Haiyan. This one has a number of shocking photos like the one to the left.

CNN: How it happened: Tracing Typhoon Haiyan’s havoc in the Philippines (lots more photos at this link)

NPR: WHO Rates Typhoon’s Medical Challenges ‘Monumental’

NPR: ‘It Looks Like A 50-Mile Wide Tornado’ Hit The Philippines

CTC News: Typhoon Haiyan: Before and after photos of storm’s damage

In other news, here’s one that will interest Dakinikat: Obama to Tap Treasury Official as Top Derivatives Regulator. From The New York Times Dealbook blog:

President Obama will nominate Timothy G. Massad as the new chairman of the Commodity Futures Trading Commission on Tuesday, a White House aide said, choosing the senior Treasury Department official to run an agency that polices some of Wall Street’s riskiest activity.

If confirmed by the Senate, Mr. Massad will succeed Gary Gensler, a former Goldman Sachs banker who overhauled the agency in the wake of the financial crisis. Mr. Gensler, credited with turning one of Wall Street’s laxest regulators into one of its most aggressive, must leave office at the end of the year when his term officially expires.

Mr. Massad, an assistant secretary of the Treasury who oversaw the unwinding of the government’s bailout program stemming from the financial crisis, would join the agency as it undergoes a makeover.

Bart Chilton, the agency’s most liberal commissioner, announced last week that he would soon depart. David Meister, the enforcement director who led actions against some of the world’s biggest banks, departed the agency last month. And Jill E. Sommers, a Republican commissioner, left months ago.

The vacancies have raised the stakes for Mr. Massad’s nomination. If Mr. Chilton and Mr. Gensler depart before their successors are confirmed, the five-member commission will be down to just two members: one Republican, Scott D. O’Malia, and one Democrat, Mark Wetjen.

That would not be good. I know Dakinikat is busy today, but here’s another article for her to weigh in on if she has time: Confessions of a Quantitative Easer. From Andrew Huszar at the Wall Street Journal:

I can only say: I’m sorry, America. As a former Federal Reserve official, I was responsible for executing the centerpiece program of the Fed’s first plunge into the bond-buying experiment known as quantitative easing. The central bank continues to spin QE as a tool for helping Main Street. But I’ve come to recognize the program for what it really is: the greatest backdoor Wall Street bailout of all time.

Five years ago this month, on Black Friday, the Fed launched an unprecedented shopping spree. By that point in the financial crisis, Congress had already passed legislation, the Troubled Asset Relief Program, to halt the U.S. banking system’s free fall. Beyond Wall Street, though, the economic pain was still soaring. In the last three months of 2008 alone, almost two million Americans would lose their jobs.

The Fed said it wanted to help—through a new program of massive bond purchases. There were secondary goals, but Chairman Ben Bernanke made clear that the Fed’s central motivation was to “affect credit conditions for households and businesses”: to drive down the cost of credit so that more Americans hurting from the tanking economy could use it to weather the downturn. For this reason, he originally called the initiative “credit easing.”

Huzar claims that Janet Yellen will likely continue Bernanke’s policies.

Even when acknowledging QE’s shortcomings, Chairman Bernanke argues that some action by the Fed is better than none (a position that his likely successor, Fed Vice Chairwoman Janet Yellen, also embraces). The implication is that the Fed is dutifully compensating for the rest of Washington’s dysfunction. But the Fed is at the center of that dysfunction. Case in point: It has allowed QE to become Wall Street’s new “too big to fail” policy.

0225-warren-clinton-630x420

More pundits are joining the anti-Hillary ranks. According to The Hill’s Alex Bolton:

Liberal leaders want Hillary Clinton to face a primary challenge in 2016 if she decides to run for president.

The goal of such a challenge wouldn’t necessarily be to defeat Clinton. It would be to prevent her from moving to the middle during the Democratic primary.

“I do think the country would be well served if we had somebody who would force a real debate about the policies of the Democratic Party and force the party to debate positions and avoid a coronation,” said Roger Hickey, co-director of Campaign for America’s Future, an influential progressive group….

Clinton raised concern among the Democratic Party’s populist base when she recently accepted an estimated $400,000 from Goldman Sachs for two speeches.

Influential progressives wonder whether someone who accepted such a large sum from one of Wall Street’s biggest investment firms could be expected to hold corporate executives accountable if elected president.

They also wonder how aggressively she’d call for addressing income inequality, which many see as one of the biggest economic problems facing the nation.

That’s odd, since Obama ran to Hillary’s right in 2008 and received more contributions from Goldman Sachs and other Wall Street firms than either Hillary or John McCain. But let’s not get caught up in facts…

Politico has taken up the suggestion from Noam Scheiber at The New Republic that Dakinikat wrote about yesterday that Elizabeth Warren should run against Hillary. Concern trolls Ben White and Maggie Haberman write:

There are three words that strike terror in the hearts of Wall Street bankers and corporate executives across the land: President Elizabeth Warren.

The anxiety over Warren grew Monday after a magazine report suggested the bank-bashing Democratic senator from Massachusetts could mount a presidential bid in 2016 and would not necessarily defer to Hillary Clinton — who is viewed as far more business-friendly — for the party’s nomination.

And the fear is not only that Warren, who channels an increasingly popular strain of Occupy Wall Street-style anti-corporatism, might win. That is viewed by many political analysts as a slim possibility. It is also that a Warren candidacy, and even the threat of one, would push Clinton to the left in the primaries and revive arguments about breaking up the nation’s largest banks, raising taxes on the wealthy and otherwise stoking populist anger that is likely to also play a big role in the Republican primaries.

So what does Warren think about all this?

A spokesperson for Warren declined to comment on whether she would consider a presidential bid against Clinton, though Warren has previously said she has no plans to run. People close to Warren note that she signed a letter from female Democratic senators urging Clinton to run in 2016. And Warren associates, mindful of any appearance of creating the narrative of a Warren-for-president campaign, have corresponded with Clinton associates to stress that they didn’t fuel the New Republic story by Noam Scheiber.

Assholes. Hey, I have an idea–why not get Kirstin Gillibrand to run against Hillary too? Of course Chris Cillizza is also rooting for Warren and Clinton to destroy each other’s chances to do anything positive about the economy:

Quick, name someone who would have a realistic chance of beating out Hillary Clinton for the 2016 presidential nomination. Martin O’Malley? Nope. Joe Biden? Maybe but probably not. Howard Dean. No way. There’s only answer to that question that makes even a little sense. And that answer is Elizabeth Warren.

And so on… bla bla bla… Don’t these idiots have anything important to write about? Like maybe jobs, children without food or health care, or the upcoming battle over the debt limit?

Thank goodness for TBogg at Raw Story: What if Elizabeth Warren went back in time and smothered Baby Hitler in his crib?

If you have been  perambulating about the internet these past few days, the above is exactly the kind of linkbait bullshit narratives that are being peddled by people who have wearied talking about President of New Jerseymerica Chris Christie or whether Rand Paul was the real life inspiration for the J.L. Borges short story, Pierre Menard, Author of the Quixote. It seems that frustrated  writers lacking hobbies have turned their lonely eyes to the Democratic side of the 2016 presidential election which is just around the corner, if by corner, you mean: three years from now. But with Hilary “Killary” Clinton pretty much chillaxing with the nomination ripe for the taking (providing she doesn’t rehire Mark Penn, aka The Man Who Could Fuck Up A Baked Potato) there isn’t a whole lot of  tension the likes of which you can find on a daily basis on the Republican Wingnut Flavor of the Week side.

So naturally, Noam Scheiber felt obligated to create some Democratic conflict. T-Bogg responds:

I love Elizabeth Warren. I would totally have her baby if she would have me. You love Elizabeth Warren. We all love Elizabeth Warren. Someday Elizabeth Warren t-shirts may very well become as ubiquitous as Che T’s. But, outside of the hazy crazy patchouli-scented fever palaces that are the comment sections of the manic progressive websites, nobody really thinks that Warren could, would, or should run an insurgent primary campaign against Clinton. And, to be quite frank, those who think Warren should run to in order to “start a conversation” are the  kind of people who have attempted this kind of thing in the past and , as my grandmother used to put it, “don’t have dick to show for it”.

Read his replies to Politico and Cillizza at the link. BTW, I wrote comment before I discovered T-Bogg’s piece. Great minds think alike, but T-Bogg expressed my reactions so much better than I could.

That should be enough to get us started on the day’s news. What stories are you following? Please post your links in the comment thread and have a terrific Tuesday!


Saturday Morning Open Thread

Abortion rights advocates fill the rotunda of the State Capitol as the Senate neared its vote Friday night (Tamir Kalifa/AP)

Abortion rights advocates fill the rotunda of the State Capitol as the Senate neared its vote Friday night (Tamir Kalifa/AP)

Good Morning Sky Dancers!!

There sure is a lot of news out there for a summer Saturday. Beginning in Texas, the state senate passed a restrictive anti-abortion bill that will threaten women’s lives. The New York Times reports:

AUSTIN, Tex. — The Texas Senate gave final passage on Friday to one of the strictest anti-abortion measures in the country, legislation championed by Gov. Rick Perry, who rallied the Republican-controlled Legislature late last month after a Democratic filibuster blocked the bill and intensified already passionate resistance by abortion-rights supporters.

The bill would ban abortions after 20 weeks of pregnancy and hold abortion clinics to the same standards as hospital-style surgical centers, among other requirements. Its supporters say that the strengthened requirements for the structures and doctors will protect women’s health; opponents argue that the restrictions are actually intended to put financial pressure on the clinics that perform abortions and will force most of them to shut their doors.

Mr. Perry applauded lawmakers for passing the bill, saying “Today the Texas Legislature took its final step in our historic effort to protect life.” Legislators and anti-abortion activists, he said “tirelessly defended our smallest and most vulnerable Texans and future Texans.”

Mr. Perry does not appear to include any “right to life” for adult women in his “effort to protect life,” however. I wonder if anyone has ever asked him one simple question: are women human beings? Forced childbirth is tantamount to slavery in my opinion. Furthermore, childbirth is far more dangerous than abortion, and the restrictions will likely mean that women with problematic late term pregnancies will die or suffer grievous harm. According to the NYT story,

The bill was opposed by many doctors, including leaders of the American Congress of Obstetricians and Gynecologists and the Texas Medical Association; the gynecologists’ group has run advertisements locally that question the scientific underpinnings of the legislation and tell legislators to “Get out of our exam rooms.”

Andrea Grimes writes at RH Reality Check: As Out-Of-State Gawkers Look On, Texas Lawmakers Prepare to Pass ‘Death Sentence’ Anti-Abortion Bill. She describes a young man from Minnesota who traveled down to Texas to watch the show.

This young guy, probably a senior in high school or a freshman in college—I didn’t catch his name—said he was real tired of wearing blue, the chosen color of anti-choice supporters of HB 2. I wore orange that day, the same color as thousands of Texans who have turned up at the capitol to stand up for reproductive rights. I also wore pink earbuds, trying to follow the house debate while waiting in line. Maybe this young guy thought I couldn’t hear him. Maybe he didn’t care.

“I’m looking forward to all this being over so I can wear my orange shirts again!” he joked.

She contrasts his blase attitude with that of Yatzel Sabat, a gay woman of color

who was dragged out of that same gallery Wednesday morning by law enforcement. Sabat was not wearing orange. She was wearing black.

Her limbs bound by state troopers, she screamed in a clear, strong voice, “This bill will kill women!” as the Texas House of Representatives gave its approval to HB 2, passing the devastating legislation along to the state senate for final passage….

This bill will kill. Period.

It will kill Texans who already travel to Mexico to buy abortion pills from flea markets because they are too poor to go to a legal abortion clinic, or unable to take time off work to find a doctor’s office and wait 24 hours between a state-mandated sonogram and an abortion procedure. It will kill Texans who, if HB 2 passes, cannot travel a thousand miles round trip to a San Antonio or Dallas ambulatory surgical center for a safe, legal abortion.

Please read the whole thing if you can.

hunger-facts-slider-2

Next up, the U.S. Congress debates more cuts in food stamps as American children go hungry. From Martha White at NBC News:

For one in seven Americans, the federal government’s Supplemental Nutrition Assistance Program, aka food stamps, is all that stands between them and too little food.

But the complicated calculus of financial survival for the working poor also means any cuts to the roughly $80 billion SNAP, as it’s known, being considered by Congress would be felt well beyond the grocery checkout line. Buying new school clothes, family outings, even getting a toehold in the financial mainstream could be thrown into limbo.

For many of the working poor, wages just don’t go far enough. The National Employment Law project says nearly 60 percent of jobs created in the post-recession recovery pay $13.83 or less an hour, and hourly wages for some low-wage occupations fell by more than 5 percent in just three years.

Food service and temporary employment make up 43 percent of the post-recession job growth, according to NELP policy analyst Jack Temple. “They overwhelmingly pay low wages,” Temple said. “For that lower segment, you’re going to see increased use of safety net programs to make up the difference.”

Read it and weep, folks; and while you do keep in mind that the Federal deficit has been dropping steadily. The only possible reasons for the austerity agenda are to make the rich richer and punish the working poor.

snowden_screens_russia_rtr_328

The Snowden saga continues.  Reuters reports that Russia has not yet received an application for asylum from the American hacker/leaker/whistleblower/dissident–or whatever he’s being called at the moment.

Russia kept former U.S. spy agency contractor Edward Snowden at arm’s length on Saturday, saying it had not been in touch with the fugitive American and had not yet received a formal request for political asylum.

Remarks by Foreign Minister Sergei Lavrov signaled Russia is weighing its options after Snowden, who is stranded at a Moscow airport, broke three weeks of silence and asked for refuge in Russia until he can secure safe passage to Latin America.

Washington urged Moscow to return Snowden to the United States, where he is wanted on espionage charges after revealing details of secret surveillance programs, and President Barack Obama spoke by phone with Russian President Vladimir Putin….

“We are not in contact with Snowden,” Russian news agencies quoted Lavrov as saying in Kyrgyzstan, where he attended a foreign ministers’ meeting.

He said he had learned of Snowden’s meeting with Russian human rights activists and public figures at the airport on Friday from the media, “just like everyone else.”

220px-Elizabeth_Warren_CFPB

Senator Elizabeth Warren is working on bringing back Glass-Steagall-like regulations on banks. From the LA Times:

Sen. Elizabeth Warren has launched a campaign to make banks boring again as she pushes legislation to enact stricter regulations forcing deposit-taking financial institutions out of the investment business.

The Massachusetts Democrat wants to reinstate the Depression-era Glass-Steagall law, which separated what she called boring checking and savings accounts that are backed by the Federal Deposit Insurance Corp. from risky investment banking.

And after joining three other senators Thursday in introducing a bipartisan bill to do that, Warren went toTwitter to rally support.

She urged her Twitter followers to retweet the message, “Banks should be boring.” She emailed her political backers, asking them to support her 21st century Glass-Steagall Act, which she introduced along with Sens. John McCain (R-Ariz.), Maria Cantwell (D-Wash.) and Angus King (I-Maine).

Yesterday Warren went on CNBC to argue her case with some blonde talking head. Check it out:

As you know, yesterday Malala Yousafzai spoke to the United Nations and told the world: Being shot by Taliban made me stronger (NBC News)

Malala Yousafzai addresses the UN

Malala Yousafzai, the Pakistani teenager shot in the head by the Taliban for campaigning for girls’ education, was given a standing ovation at the United Nations Friday as she declared the attempt on her life had only given her strength and banished any fear she once felt.

“Dear friends, on the 9th of October, 2012, the Taliban shot me on the left side of my forehead. They shot my friends too,” she said in her first major public appearance. “They thought that the bullets would silence us, but they failed.”

Speaking on her 16th birthday, she said the “terrorists thought that they would change my aims and stop my ambitions, but nothing changed in my life except this — weakness, fear and hopelessness died, strength, power and courage was born.”

“I am the same Malala, my ambitions are the same, my hopes are the same and my dreams are the same,” she said to thunderous applause.

What an courageous, intelligent, and inspiring and young woman she is!

On that note, I’ll turn the floor over to you. What stories are you following today. Please post your links on any topic in the comment thread. Have a stupendous Saturday


Monday Reads

ladiesworld_golf_mediumGood Morning!

I spent Mother’s Day napping on dad’s sofa mostly.  I am such an exciting person!!  I have no idea why I am so cold and so worn out but it is what it is.

Meanwhile,  all hell broke loose in New Orleans.  The gun violence that hit a Mother’s Day parade there was pretty much the kind of urban violence we see all too often with such easy access to guns. I wish I could say that gun violence was rare in the 7th ward.  But it is not.  Here’s a word from my congressman Cedric Richmond:

According to FBI data, 1,464 people were killed by firearms in New Orleans between 2008-2011. That’s 1,464 families who will never see their loved ones again. If we were to have passed the entirety of President Obama’s proposed reforms, sadly, many of those victims would probably have still been killed because violence is a pervasive and complex problem with a diverse set of causes. Economic insecurity, poor mental health treatment options, inferior education options and the scarcity of positive opportunities are all contributors, which one regulation alone cannot eliminate. That being said, if we only acted on just a few of the president’s proposals, we could decrease the supply of guns used in the homicides by reducing the supply of illegally purchased guns via universal background checks. This would decrease the use of guns in violent crime and keep a few more families from having to bury a loved one.

While I was serving as a member of the Louisiana House of Representatives, I introduced an assault weapons ban bill on numerous occasions. I took on the National Rifle Association in these battles not because I have a grudge against gun owners, but because I could find no reasonable defense of having these weapons of mass destruction on our streets. As a resident of Sportsman’s Paradise, I am a strong supporter of the Second Amendment. However, I do not ascribe to the belief that Congress has no role in responding to the gun violence epidemic plaguing communities like New Orleans, Chicago and Detroit.

It seems that 19 people were injured with no fatalities.

A Mother’s Day second-line shooting on Frenchmen Street in the 7th Ward, on Sunday about 1:45 p.m., left 19 people injured, according to the latest NOPD numbers. Earlier Sunday afternoon, NOPD Superintendent Ronal Serpas said that about 12 people had been injured, but the toll later grew to 19, with the NOPD explaining that some victims initially hadn’t reported being injured and more people continue to come forward.

Police said 10 adult men, seven adult women, a 10-year-old boy and a 10-year-old girl were struck by bullets.  Both of the 10-year-old victims had graze wounds to the body and were in good condition. A man and a woman were reported to be in surgery Sunday evening.

The shooting occurred in the 1400 block of Frenchmen Street at the intersection of North Villere Street. Immediately after the shooting police reported seeing three suspects running from the scene. One suspect was seen running on Frenchman toward North Claiborne, police said.

NOPD spokeswoman Remi Braden said many of the victims were grazed, some by bullets that ricocheted. “At this point, there are no fatalities, and most of the wounds are not life-threatening,” she said in an email.

“But all medical conditions are not known at this time as victims were rushed to nearby hospitals,” Braden continued. “Detectives are conducting interviews, retrieving any surveillance video in the area and, of course, collecting all evidence. This is an extremely unusual occurrence, and we’re confident that we will make swift arrests.”

Kevin Allman, editor of Gambit Weekly, said one of the publication’s writers, Deborah Cotton, also known as the blogger Big Red Cotton, was shot and was in stable condition after undergoing surgery.

Shannon Roberts, 32, was in the Interim LSU Hospital in New Orleans on Sunday afternoon and early evening alongside reams of other crying and fear-ridden – and at times, angry –  family members whose loved ones were injured in the shooting. Roberts said she was waiting on a 21-year-old nephew who was shot in the arm and stomach, a 37-year-old niece shot in the arm, and a 39-year-old cousin shot in the back.

“All innocent bystanders got hit,” Roberts said. “When I got the call saying they were shot, I wasn’t thinking at all, I was just shivering and crying… just hoping they be all right.

Hatred evidently has a basis in geography in this country.  This is an interesting twist on studying information from Twitters, locations, and Printdisplays of racism, homophobia, and basic hate speech.

Twitter, even more than many other social media tools, can feel disconnected from the real world. But a group of students and professors at research site Floating Sheep have built a comprehensive map of some of Twitter’s most distasteful content: the racist, homophobic, or ableist slurs that can proliferate online. Called Geography of Hate, the interactive map charts ten relatively common slurs across the continental US, either by general category or individually. Looking at the whole country, you’ll often see a mass of red or what the map’s creators call a “blue smog of hate.” Zooming in, however, patches appear over individual regions or cities; some may be predictable, while others are not.

The map builds on an earlier Floating Sheep project that showed where President Obama was referenced with racial slurs, but it’s far more comprehensive and well-constructed. Unlike many other studies, for example, the tweets weren’t collected and analyzed algorithmically — a method that could accidentally collect non-derogatory uses of these terms. Instead, the team first searched through a year’s worth of geotagged tweets for words, then had a group of students at Humboldt State University look at each one. Only tweets they found explicitly negative went on the map: a derogatory use of the word “dyke” would be added, for example, but one reclaiming the term for a gay pride parade would not. In total, the map charts about 150,000 negative, slur-filled tweets.

Here is some “Terrible News About Carbon and Climate Change”.

This past Thursday, the daily average atmospheric concentration of carbon dioxide, as measured by the Mauna Loa observatory in Hawaii, passed four hundred parts per million. In some way it was a meaningless milestone. We know that CO2 is increasing; we knew this moment would come; we know that four hundred is no more different from three hundred and ninety-nine than it is from four hundred and one.

Still, the number should shake us, if not shock us. We’ve got more carbon dioxide in the atmosphere now than at any point since the Pliocene, when there were jungles in northern Canada. And the number hurdles ever upward, as ocean levels rise and extreme weather becomes routine. Three-fifty was the old target; four-fifty is the new one. But what indication is there that we’ll stop at five hundred, six hundred, or even more?

We’ve failed collectively. As Ryan Lizza explained in miserable detail in 2010, the United States government couldn’t pass a tepid, eviscerated law. Activists have failed. We’ve all failed morally: a problem created by the world’s rich will now crush the world’s poor. In a grand sense it’s also a failure of the creators, and deniers, of climate change: the Exxon-Mobils, say, or the Wall Street Journal editorial page. A victory isn’t worth much if your children and grandchildren will one day think of you with anger and shame.

How do we get out of this mess? The political system seems hopeless. Yes, government regulation has done much to relieve us of acid rain and smog. But global warming combines two intractable problems. Reducing emissions mainly benefits people who aren’t born and don’t vote. And it requires international coördination, which is hopeless, and international law, which is toothless. We should do things like build more public transportation, which helps people here and now. We should design our cities for a future with terrible weather. But solving the problem of climate change through the U.N. is like a small man with olive oil on his hands trying to pull a whale from the water.

Man's-Life-Vintage-Magazine-Covers-12I’ve become somewhat fascinated with charter schools given their presence in New Orleans and their supposed success.  Who makes money from these things and why is that important?  It has a lot to do with Real Estate Developers and Hedge Fund Managers.  This is worth reading.

Studies shows that charter schools don’t typically outperform public schools and they often tend to increase racial and class segregation. So one must wonder, what exactly is motivating these school “reformers”? And why have they pushed for more and more closure — and new charter schools — at such an unprecedented rate in recent years?

Pro-charter supporters will tell you that it’s time for public institutions like our schools to start competing more like for-profit institutions. Test scores and high enrollment, then, define success. Unsuccessful schools, they say, should close just as unsuccessful businesses do. For neoliberal school reformers from today’s Arne Duncan-led Department of Education to scandal-ridden movement leader Michelle Rhee to billionaire Bill Gates, it is taken on faith that market principles are desirable in education.

But since it’s not clear that market principles are benefiting students on a large scale, it seems likely that something else is at stake. And reformers may be more than a little disingenuous in publicly ignoring that other, less high-minded thing: Profit. Critics of charter schools and school closings point out that proponents may not really be motivated by idealism, but by self-gain.

But who precisely is profiting? And how? Untangling answers to these questions is a more daunting task. Compared to public schools, charters schools are an extremely unregulated business. They contract with private companies to provide all kinds of services, from curriculum development to landscaping. Most of the regulations that bind charter schools are implemented at the state level. And unlike public institutions, the finances of charter schools are managed on a school-by-school basis. Because they are not consistently held accountable to the public for how they distribute funds, charter schools are often able to keep their business practices under wraps, and thus avoid too much scrutiny.

Here’s economist Joseph Stiglitz warning us about the crushing student debt in the U.S.

According to the Federal Reserve Bank of New York, almost 13 percent of student-loan borrowers of all ages owe more than $50,000, and nearly 4 percent owe more than $100,000. These debts are beyond students’ ability to repay, (especially in our nearly jobless recovery); this is demonstrated by the fact that delinquency and default rates are soaring. Some 17 percent of student-loan borrowers were 90 days or more behind in payments at the end of 2012. When only those in repayment were counted — in other words, not including borrowers who were in loan deferment or forbearance — more than 30 percent were 90 days or more behind. For federal loans taken out in the 2009 fiscal year, three-year default rates exceeded 13 percent.

America is distinctive among advanced industrialized countries in the burden it places on students and their parents for financing higher education. America is also exceptional among comparable countries for the high cost of a college degree, including at public universities. Average tuition, and room and board, at four-year colleges is just short of $22,000 a year, up from under $9,000 (adjusted for inflation) in 1980-81.

Compare this more-than-doubling in tuition with the stagnation in median family income, which is now about $50,000, compared to $46,000 in 1980 (adjusted for inflation).

Like much else, the problem of student debt worsened during the Great Recession: tuition costs at public universities increased by 27 percent in the past five years — partly because of cutbacks — while median income shrank. In California, inflation-adjusted tuition more than doubled in public two-year community colleges (which for poorer Americans are often the key to upward mobility), and by more than 70 percent in four-year public schools, from 2007-8 to 2012-13.

With costs soaring, incomes stagnating and little help from government, it was not surprising that total student debt, around $1 trillion, surpassed total credit-card debt last year. Responsible Americans have learned how to curb their credit-card debt — many have forsaken them for debit cards, or educated themselves about usurious interest rates, fees and penalties charged by card issuers — but the challenge of controlling student debt is even more unsettling.

Curbing student debt is tantamount to curbing social and economic opportunity. College graduates earn $12,000 more per year than those without college degrees; the gap has almost tripled just since 1980. Our economy is increasingly reliant on knowledge-related industries. No matter what happens with currency wars and trade balances, the United States is not going to return to making textiles. Unemployment rates among college graduates are much lower than among those with only a high school diploma.

Who is the one person in the beltway looking for answers?  Massachusetts Senator Elizabeth Warren is looking at handing the loans over the Fed.  The problem is that no one seems to be taking the bill seriously.

Senator Elizabeth Warren (D-MA) has just introduced a new bill, the Bank on Students Loan Fairness Act, to offer student loans at the same rates that the Federal Reserve charges big banks through its discount window lending program. At the moment, that rate is about 0.75%. The rates on federally guaranteed student loans, meanwhile, is set to double to 6.8% this summer.

“Some may say we can’t afford this proposal,” said Senator Warren as she introduced the bill. “I would remind them that the Federal Government currently makes 36 cents in profit for every dollar it lends to students . . . meanwhile, the banks pay interest that is one-ninth of the amount that students will be asked to pay. That’s just wrong. It doesn’t reflect our values.”

“Now some explain that the banks get exceptionally low interest rates because the economy is still shaky and banks need access to cheap credit to continue the recovery.” She sighed loudly. “But our students are just as important to the economic recovery as our banks, and the debt they carry poses a serious risk to that recovery.”

It’s probably true that some say banks need low interest rates to keep the economy growing. But no one except possibly a lunatic has told Elizabeth Warren that banks are getting 0.75% at the discount window as a thank you for all the hard work they’re doing helping the economy. Discount window loans are cheap for three reasons: the borrowers have assets and income that are easy to seize, the loans are quite short term, and the banks are required to put up collateral.

As you’ll have discovered with your own mortgage or car loan, the shorter the term of the loan, the lower the interest rate. You will also have discovered that loans secured by collateral, like your car loan or mortgage, carry lower interest rates than loans such as credit card expenditures, which are secured by nothing more than your heartfelt promises to pay. You may even have noticed that the more durable the collateral, the more attractive a rate your banker will extend on it.

So it is with loans to other people, and businesses. Banks get a very low rate because they’re borrowing for very short periods of time–often overnight, always less than a year. The Fed correctly figures that the bank is unlikely to go out of business by next month–and anyway, they’re putting up collateral, which is unlikely to lose all its value in such a short period of time.

Students, on the other hand, are borrowing for a decade, and the only thing they’re putting up as a guarantee is their character. How good a collateral is their character? In 2011, 9.1% of borrowers had defaulted on their student loan within the first two years of the payment period.

The interest paid by the folks who don’t default is the only thing keeping this program from hemorrhaging money. Elizabeth Warren proposes to cut that interest rate to less than the rate of inflation.

So, those are my suggestions this morning.  What’s on your reading and blogging list today?