Jobs Bill is a Work in Process

Posted: October 5, 2011 | Author: | Filed under: jobs, unemployment | Tags: | Comments Off on Jobs Bill is a Work in Process

President Obama announced his American Jobs Act with repeated calls to just pass the bill on a Thursday night. The following Monday, he provided a list of revenue sources for the bill to head off Republican complaints on its potential deficit implications.  He then took to the countryside to try to drum up support for the measure.  That was three weeks ago around Labor Day, remember?  So, where’s the bill? As expected, the bill raised a number of issues from both sides of the aisle.  The Republicans are still determined to say no to everything and the Democratic Caucus was less than enthusiastic on many of the bills provisions.  There is some more detail coming up on all of that today so I thought I’d share it.

Senate Democrats have taken issue with the Monday list of things suggested to pay for the bill. As economist, it does seem odd to try to pass a piece of legislation made to jump start the job creation process while offsetting the impact with recessionary fiscal measures.  The President is still more interested in meeting the Republicans more than half way than actually achieving effective legislation, imho.

Reid indicated he is going back to the drawing board to shore up wavering Democratic support for the $447 billion jobs bill.

Reid told his Democratic colleagues Tuesday that he would put together a new plan to pay for the package after rank-and-file colleagues balked at proposals to limit tax deductions for the wealthy and raise taxes on oil and gas companies.

“There are a wide range of things that we’re looking at, because the only objections I’ve heard from my caucus on the president’s jobs bill deal with the pay-fors,” Reid said. “So we’re resolving that issue as we speak.”

The real issue appears to be the tax increases for the extremely wealthy.  It appears to be highly unpopular with the usual group of DINOs.  Most of them are more concerned about their job safety than the jobs that any plan could potentially create. My Senator is still basically representing her donor base.

Sen. Ben Nelson (D), who faces a tough election in conservative Nebraska, said he would vote against a motion to begin floor debate on Obama’s bill.

“No, no, no,” Nelson said, when asked if he would roll the dice by allowing the bill to come to the Senate floor in hopes of amending it. “With the current offsets that are essentially tax increases? No.

“This is a time to be cutting. The cutting stops when the taxes increase,” he said.

Sen. Jon Tester (D-Mont.), another vulnerable incumbent, said Tuesday he would oppose the jobs bill as Obama drafted it.

“I can’t support it in its current form,” he told The Hill.

Sen. Mary Landrieu (D-La.), a critic of the oil and gas tax provisions, which would hurt a crucial industry in her home state, said she had yet to make up her mind.

“I’m going to listen to what the leadership says and make a decision about that later,” she said.

Sen. Kay Hagan (D-N.C.) said she would prefer raising new revenues through comprehensive tax reform instead of zeroing in immediately on specific tax increases.

“I think we’ve got to have comprehensive tax reform,” she said. “I’m always interested in looking at what we can do from a comprehensive standpoint.”

Max Baucus is testing the waters with a surtax on millionaires to fund the act. This measure is considered less controversial for Democrats.

Now, driven by party leadership and Sen. Max Baucus (D-MT), whose powerful Finance Committee has jurisdiction over the jobs bill, they’re considering a simpler, less parochial, and thus less divisivemeasure.

A Senate Dem aide cautioned that nothing’s final yet, and the party could ultimately settle on different measures. And there’s a history of broad Democratic support for raising taxes on millionaires.

During the health care debate in 2009, House Democrats backed a similar surtax on millionaires that would have raised over $500 billion over 10 years — more than enough to pay for Obama’s bill. Republicans and conservative Senate Democrats objected, and the measure didn’t make the cut in the final bill.

During the tax fight last December, Sen. Chuck Schumer (D-NY) proposed a creating a new millionaires tax bracket, rather than letting the Bush tax cuts expire for income above $250,000. It failed to overcome a filibuster but garnered broad Democratic support. And it also would have more than paid for Obama’s jobs bill.

That’s why something along these lines seems likely to bring most, if not all, Dems into the fold.

However, that still leaves the Republicans who continue to hold the economy hostage for their political purposes.  Republicans are said to be more united in their opposition to the American Jobs Act than the Democrats care about getting the act into law.  No surprises there! Anyway, the bill–as well as the current budget fight–seems like just another political prop in a campaign election season.

Meanwhile, there’s a lot of information being released today on the job market.  None of it is good.   Announced job cuts are said to be more than three times what they were this time last year.

U.S. employers announced the most job cuts in more than two years in September, led by planned reductions at Bank of America Corp. (BAC) and in the military.

Announced firings jumped 212 percent, the largest increase since January 2009, to 115,730 last month from 37,151 in September 2010, according to Chicago-based Challenger, Gray & Christmas Inc. Cuts in government employment, led by the Army’s five-year troop reduction plan, and at Bank of America accounted for almost 70 percent of the announcements.

While the bulk of firings are not “directly related” to economic weakness, they “could definitely be a sign of more cuts to come,” John A. Challenger, chief executive officer of Challenger, Gray & Christmas, said in a statement. “Bank of America is not the only bank still struggling in the wake of the housing collapse, and the military cutbacks are probably just the tip of the iceberg when it comes to federal spending cuts.”

More reductions will add to the pool of job seekers competing for work as policy makers, including President Barack Obama and Federal Reserve officials, strive to spur the labor market. Payrolls probably didn’t rise fast enough last month to lower the jobless rate, according to a Bloomberg News survey of economists before the Labor Department’s monthly jobs figures in two days.

However, Obama’s efforts appear to be paying off a little bit because the level of disgust with Congress is hitting a record high.  While Obama isn’t fairing much better, his bright spot was on who was more able to take on the nation’s jobs problem.

But the president’s new jobs package, which is supported by a narrow majority of the public, has bolstered his position on the issue. He now holds a 49 to 34 percent advantage over congressional Republicans when it comes to the public’s trust on creating jobs. That is a change from September, when they were evenly split at 40 percent each.

It’s hard to image that this entire situation could get much worse, but from the recent forecasts I’ve seen–including a new on from Goldman Sachs–there appears to be a consensus building that unemployment will go up again shortly.  This is certainly not good news for any one.  However, there seems like anything but a sense of urgency to do something about these forecasts within the beltway.  As usual, the only jobs they care about are their own.

The Double Standard Still Exists: Misogyny on the Web

Posted: October 4, 2011 | Author: | Filed under: Violence against women, Women's Rights | Tags: , , | 11 Comments

I’ve been on Facebook for a long time.  It used to be limited to folks with mail addresses with the .edu extensions.  It was some place where I could quietly stalk my daughter’ activities and friends and trade things with students. I was glad when the girls left MySpace because most of my time there was spent deleting friend requests from middle age male trolls who had pages full of glittery comic pin up girls and nothing but extremely desperate women for “friends”.  I may have my share of self doubt, but I am not evidently self-loathing enough to befriend stalkers and dudes looking for nasty pictures and opportunities for sexting with one hand.

Later, Facebook proved a good resources for my friends that blogged at FireDogLake and spreading information about activist events.  About a year later, the place went crazy.  It is still mostly where I can track youngest daughter’s activities and pictures.  Doctor Daughter has all but abandoned it since she discovered future employers stalk future employees there.  I specifically hate the chat feature but there are also disturbing pictures and ads that pop up.  I still hang in there but try not to linger. As an example,   I’m still in the process of trying to wash my brain of an animal cruelty photo I wish I hadn’t see yesterday.  I also tire of all those Farmville requests.  But that’s nothing compared to some of the other things I see.  I  find the ads that announce there are men looking for good women supremely offensive. I don’t want to participate in public mating rituals for the desperate.  Honestly, it’s just gross!

Now, Facebook has become a lot more commercial and what probably drives me crazy the most are all the ads.  I’ve been on the internet for nearly 30 years now and it’s no longer the place where you can escape American Consumerism and the pursuit of customers.  It used to be a nice little place where no one but academics, students, and computer geeks hung out.  Facebook is just one good example of what keeps going wrong. Don’t even get me started on all the confusing and unwanted upgrades.

Then, just when I think the social networking biz has hit bottom, something else comes to my attention.  Evidently, I’ve been fortunate enough to miss these websites. Cath Elliot at the UK Guardian’s story is this: ” Facebook is fine with hate speech, as long as it’s directed at women: The social network’s ‘jokes in the pub’ analogy, defending its decision not to take down pro-rape pages, is offensive”.  Never thought I’d say I’d miss the glitterati pin up girls at some point.  Oy!

It was back in August that feminists first began to notice the proliferation of pro-rape pages on the popular social networking site. Two months later over 176,000 people have signed a US-based petition calling on Facebook to take them down, and nearly 4,000 people have signed a UK-based petition calling for the same. The Facebook pages, such as the one cited above and others that include “You know she’s playing hard to get when your [sic] chasing her down an alleyway” still remain.

Facebook’s initial response to the public outcry was to suggest that promoting violence against women was equivalent to telling a rude joke down the pub: “It is very important to point out that what one person finds offensive another can find entertaining” went the bizarre rape apologia. “Just as telling a rude joke won’t get you thrown out of your local pub, it won’t get you thrown off Facebook.”

And in some ways they’re right: telling a rude joke probably wouldn’t get you thrown out of your local pub. I’d suggest, however, that propping up your local bar while inciting others to rape your mate’s girlfriend “to see if she can put up a fight” would not only get you thrown out, it would in all likelihood get you arrested as well. Still, at least you could log on once you got home and post your offensive comments on Facebook instead, safe in the knowledge that they wouldn’t do anything about it.

What Facebook and others who defend this pernicious hate speech don’t seem to get is that rapists don’t rape because they’re somehow evil or perverted or in any way particularly different from than the average man in the street: rapists rape because they can. Rapists rape because they know the odds are stacked in their favour, because they know the chances are they’ll get away with it.

And part of the reason rapists get away with it, time after time after time, is because we live in a society that all but condones rape. Because we live in a society where it’s not taken seriously, and where posting heinous comments online that promote sexual violence are not treated as hate speech or as content that threatens women’s safety, but are instead treated as a joke and given a completely free pass.

Facebook should’ve outgrown its awkward geeky college boy sensibilities years ago when it sold out to the corporate overlords.  However, it’s clear that the last frontier of hatred continues to be sexism.  That Guardian Op Ed popped up just days after this one showed up in The Economist: The changing adult business At a XXX-road:The adult industry is seeking respectability—and profits.  Are the English the only ones concerned with the way businesses on the net exploit women? There’s a title now for it: porntrepreneurs.

Big changes are afoot in the global adult entertainment business. The recent launch of the .xxx internet domain, whose addresses went on sale in September, betokens the industry’s new respectability—although the decision comes at the end of an acrimonious debate that exacerbated criticisms of the internet’s governance (see article). But the ease with which the internet gratifies people’s appetite for porn has—at least so far—eroded their willingness to pay for it. The plethora of free flesh available on “tube sites”, where surfers watch and upload online video clips, has disrupted old business models. Companies are consolidating; and barriers to entry are getting higher because of new technology and savvier competitors.

Old-style pornocrats are struggling. Shares in Private Media Group, an adult company listed on the NASDAQ stock exchange, have fallen from around $10 five years ago to less than 70 cents today. Subscription revenues are flaccid and sales of erotic DVDs have fallen by 70% across the industry in the past five years, reckons Steven Hirsch, the founder of Vivid Entertainment, who is something of a Bill Gates of porn. His strategy has been to focus on specialised products like celebrity sex tapes and pornographic parodies. Other big brands like Hustler and Playboy have chosen to diversify, and now trade on their names as much as their naughtiness. Playboy gets kickbacks from the bunnies that adorn clothing and other consumer-goods worldwide. One of the most profitable parts of Hustler’s business is its casino in Los Angeles.

Manwin, a Canadian firm that owns the world’s largest network of adult sites, is a pioneering pornbroker. The group has expanded fast. It now owns seven of the 20 most trafficked tubes, along with paysites and live camera services. The firm uses technical know-how to boost profits, but it does not keep or sell users’ data. It has figured out the best length for free teasers in various niches: long enough to pique the user’s interest, but not too long to keep him from paying for more.

Jejeune porntrepreneurs need to learn about new technologies. “Cam sites”, whose live sex chats benefit from interactivity, are doing spectacularly well. LiveJasmin, a cam company, is about the 50th most visited site in the world, and is the number one adult destination. Revenues have jumped by between 10% and 20% every year since it launched in 2001.

Many say that mobile technology is the future.

Mobile technology?  Do men EVER get any work done? XXX domain names?

This is serious business and signs of high tech social dysfunction.  It makes me feel like all that stuff I did in the 70s for women’s equality was for naught.  I can’t believe this is the world that’s been left to my daughters some time.  Here’s the ending paragraph from The Economist. I’ll just quote that and end this with a huge sigh.

So long as commodifying desire remains the route to success in the free market, the future of the adult industry seems assured. Some see the tubes as a boon, since they get people used to consuming erotica. The proportion of Google searches that include the word “porn” has tripled since 2004. Boffins disagree about how much troubling tropes in porn affect behaviour. They have certainly shifted the boundaries of normality, towards more exotic practices in the bedroom and fads in pubic hair (or lack of it). To be truly adult, the porn industry may need to be franker about its side-effects.

Late Night Post: a Rogue and/or Broken Nation

Posted: October 3, 2011 | Author: | Filed under: 2012 presidential campaign, Barack Obama, Civil Liberties, Civil Rights, Congress | Tags: , , , | 16 Comments

There’s a pretty good amount of twitter chatter and blog posts on these thoughts at interfluidity by steve randy waldman. I understand the draw because I’ve had very similar thoughts and expressed many of them recently. I thought this would be a good discussion post to follow BostonBoomer’s last post too since it’s very much related to the post called “an echo”.

I no longer trust my own government to be the provider of a civilized society. No government is perfect or without corruptions. But in 2007, I thought I lived in a remarkably well-governed nation that had gone off-kilter under a small and mean administration. In 2011, I view my government as the sharp edge of an entrenched kleptocracy, engaged in ever more expansive schemes of surveillance and arrogating powers of ever less restrained brutality. At a visceral level, I dislike President Obama more than I have disliked any politician in my lifetime, not because he is objectively worse than most of the others — he is not — but because he disproved my hypothesis that we are a country with basically good institutions brought low by poor quality leadership. Whenever I hear the President speak and am impressed by the quality of his intellect, by his instinct towards diplomacy and finding common ground and rising above petty struggles, I despair more deeply. Not just because a leader of high quality failed to restore passably clean and beneficient government. It is worse than that. The kleptocracy has harnassed this man’s most admirable qualities and made them a powerful weapon for its own ends. He has rebranded as “moderate”, “adult”, “reasonable”, practices such as unaccountable assassination lists and Orwellian nonhostilities. He has demostrated that the way grown-ups get things done in Washington is by continually paying off thieves in suits. Perhaps it is unfair to blame Barack Obama for all this. Maybe he has done the very best a person could do under our present institutions. But then it is not unfair to detest the institutions, to wish to see them clipped, contained, or starved.

This message is followed by a mea culpa expressing profound regret for supporting the Bush Administration and the Iraq War.  Also, there’s a link to the Salon article“The due-process-free assassination of US citizens is now a reality” from Glenn Greenwald which is something we’ve previously discussed.  What drug me to the post was a response over at The Atlantic by Conor Friedersdorfer who was just quoted on BB’s post.  We’re treated to some of the top ten abysmal hits of the past few years.  The bailout of banks while their bad business models still wreck havoc on our neighbors and in our cities and towns is there.  The normalization of torture and spying on citizens is listed plus a few other things that I’ve come to view as a bigger problem now than the issues surrounding Watergate and Vietnam were then.

We’ve been lied to before.  We’ve had a few of our citizen’s rights stomped about but nothing quite so systematic and unchecked.  It also seems that our institutions and especially our courts were resilient enough to stand their grounds in the past.  There were people who stood on our principles.  I’m not seeing any institutional response to the lying and executive branch power grab from Congress or the Courts or the loudest and most followed parts of the Media.

We’ve had absolutely no recompense or justice for the atrocities against liberty that we’ve experienced since 9/11. None at all.  This is what led Fiedersdorfer to ask if we were suffering from rogue leadership or broken institutions.  What ever the source, we’ve been acting like a rogue and broken nation for nearly a decade and it’s as worrisome as it is depressing.  He argues that we’ve had broken leadership during this century and that our institutions will heal.  I only wish I had his optimism.

Before pinning the blame on American institutions, let’s ponder how radically different the status quo would be if we merely adhered to longstanding laws and norms, rather than permitting our leaders to flout them in the name of protecting us from terrorism or financial collapse.

Had the Bush Administration followed the law, it never would have tortured prisoners or started secretly spying on American citizens without a warrant. If Barack Obama was as committed to fulfilling our treaty obligations as pushing his domestic agenda in an optimized political climate, he’d have investigated and prosecuted the Bush officials complicit in torture. As President Reagan wrote upon sending the Convention Against Torture to the Senate that ratified it, “Ratification of the Convention by the United States will clearly express United States opposition to torture, an abhorrent practice unfortunately still prevalent in the world today. The core provisions of the Convention establish a regime for international cooperation in the criminal prosecution of torturers relying on so-called ‘universal jurisdiction.’ Each State Party is required either to prosecute torturers who are found in its territory or to extradite them to other countries for prosecution.”

In Libya, where Obama violated the War Powers Act, and in various countries where President Obama is waging undeclared drone wars, more scrupulous adherence to the law would force radical changes in American behavior — as would a modicum of congressional leadership, since the body has for years abdicated its responsibility. The Founders envisioned three branches of government acting as checks on one another, the members of each zealously guarding their authority and pushing back against excesses committed by their fellow branches.

Read the rest of this entry »

Monday Morning Reads

Posted: October 3, 2011 | Author: | Filed under: morning reads | Tags: , , , , , , , , , | 25 Comments

Good Morning!

This is going to be a busy week or so for me.  If you don’t see me around, just know I’m off doing things to put me on a new and hopefully higher path.  I’m defending my dissertation on the 13th, doing paper presentation on the 21st, and sending out CV packets all over the globe.  I love New Orleans but I’m headed to hopefully greener pastures.  I can’t take the war on Higher Education here any more.  Youngest daughter graduates from LSU in the spring and we’re both headed to places that aren’t dedicated to reinstating Plantation economies.  I’m cutting my losses before it gets any worse.

So, I had to bring this to the top of the links this morning.  Minx posted it down thread last night as I was actually reading it.  We have to find a way of cutting the Koch Brothers off the federal teat.  They pay small sums to loot our national resources and then they defy our national security priorities on the side.  They’ve been found getting rich off of secret sales to Iran and also bribing folks for contracts.  Thank goodness for whistle blowers!  It’s time to close them down.  This is from Bloomberg.

In May 2008, a unit of Koch Industries Inc., one of the world’s largest privately held companies, sent Ludmila Egorova-Farines, its newly hired compliance officer and ethics manager, to investigate the management of a subsidiary in Arles in southern France. In less than a week, she discovered that the company had paid bribes to win contracts.

“I uncovered the practices within a few days,” Egorova- Farines says. “They were not hidden at all.”

She immediately notified her supervisors in the U.S. A week later, Wichita, Kansas-based Koch Industries dispatched an investigative team to look into her findings, Bloomberg Markets magazine reports in its November issue.

By September of that year, the researchers had found evidence of improper payments to secure contracts in six countries dating back to 2002, authorized by the business director of the company’s Koch-Glitsch affiliate in France.

“Those activities constitute violations of criminal law,” Koch Industries wrote in a Dec. 8, 2008, letter giving details of its findings. The letter was made public in a civil court ruling in France in September 2010; the document has never before been reported by the media.

Egorova-Farines wasn’t rewarded for bringing the illicit payments to the company’s attention. Her superiors removed her from the inquiry in August 2008 and fired her in June 2009, calling her incompetent, even after Koch’s investigators substantiated her findings. She sued Koch-Glitsch in France for wrongful termination.

Every time I read about one of these things I think about the vast number of times I could’ve whistle blown on almost all the private sector companies I’ve ever worked for at one time or another.  It just makes me wonder what else is out there going unreported. The Federal government should make sure that they get severely fined, taken to court, and banned from accessing federal resources. But, given the lessons of GE, I doubt that will happen.   However, please boycott these brands owned by the Koch brothers: Stainmaster, Brawny, Dixie Cups, and Quilted Northern.

The Hill reports that Republicans are getting restless and eating their young  yet again.  It’s the blame game and the election season rolled into one!  I will pass out some popcorn if you need it!

GOP lawmakers told The Hill that redistricting pitting incumbents versus incumbents, coupled with the threat of Tea Party primary opponents, has sparked a lot of anxiety among House Republicans.

At separate closed-door conference meetings held last month as GOP leaders scrambled for votes on the appropriations bill that would ultimately fail, the topic of primaries and uncertain political futures ranked high among members’ complaints.

A freshman GOP member attributed the initial failure of the bill to assumptions on the part of the leadership. There were expectations, the member said, that enough Democrats would vote yes and that Republicans who backed the debt-reduction deal this summer would also approve of the stopgap appropriations bill. Yet, only 6 Democrats voted yes and 15 Republicans who embraced the debt deal — that set the baseline funding level — rejected the spending bill that fell 195-230.

“It was assumptions being made, not understanding the political landscape, Republicans running against Republicans in primaries and it not being a conservative position that we believe in. Continuing resolutions are not the way to run a government,” the lawmaker explained.

Other GOP lawmakers told The Hill, on the condition of anonymity, that redistricting and the threat of tough primary battles will cause problems for GOP leaders as they seek to round up votes on politically difficult budget bills.

One senior GOP lawmaker said, “[Speaker John] Boehner’s (R-Ohio) starting to have a problem internally because redistricting is pitting Republican versus Republican.”

Just wanted to let you know that it is likely that the Maconda Well is likely leaking again and you’re probably not hearing about it unless you read and watch AJ or live around here. A sheen has been reported since August and throughout September.  Some folks say the oil sheen has been around since March.

Fresh oil has been washing ashore in many areas which took a direct hit from last year’s disaster, including the Chandeleur Islands, Ship Island, Breton Island and the north part of Barataria Bay, Louisiana. AJE reports BP has reactivated clean-up operations with its Vessels of Opportunity program. Some suggest the oil is coming from natural seeps, which always occur in the Gulf. Others note oil could be leaking from the broken riser pipe, still on the ocean floor, which connected the Deepwater Horizon rig to the well. Another possibility, the most serious, is oil could be leaking at the seafloor beneath the capped wellhead, making it impossible to control.

On  September 27th, the Coast Guard said the oil sheen in Gulf could be sign of release from riser pipe and not the Macondo well not itself.  I guess that beats the natural leakage from shale formations we keeping hearing from BP.   Meanwhile, I still have serious questions about Gulf Seafood which is a horrible thing to have to say.  Here’s some information on research on Marsh Fish that are still showing signs of oil effects written up in the Miami Herald.  I’ve personally had some friends in the shrimping business tell me they’ve been hauling up shrimp with no eyes.  Meanwhile, there’s more drilling afoot and I bet you’re not hearing any of this where you live.

“The message that seafood is safe to eat doesn’t necessarily mean that the animals are out of the woods,” said Andrew Whitehead, an assistant professor of biology at Louisiana State University and a lead researcher in the study, which was published this week in the Proceedings of the National Academy of Sciences.

The researchers measured cellular responses in the liver tissue that showed which genes were being turned on and off. Those patterns allowed researchers to predict problems of health and reproduction.

The responses were detected even though the water was clean and only very low or non-detectable concentrations of oil components showed up in fish tissues.

“Where’s the oil? It’s in the sediments,” Whitehead said. Scientists assume that fish can be exposed when waves and storms stir sediments..

The study found the same kind of cellular responses in killifish as were observed in herring, salmon and other animals that later had large population losses as a result of the Exxon Valdez spill, Whitehead said.

It will take several years before it will be known whether the population of Louisiana killifish, an important food for other fish, declines, Whitehead said.

“Ultimately, that’s what we’re interested in – the population consequences over the long term,” he said.

The researchers found that when they exposed developing fish embryos to the same water and sediment in the lab, they showed the same cellular responses.

They also found that the gill tissues weren’t healthy. The gills are important for helping the fish compensate for changes in its environment such as shifts in temperature and levels of salt and oxygen in the water, Whitehead said.

Doug Inkley, a senior scientist with the National Wildlife Federation, said the killifish, also known as the bull minnow or cacahoe, was an important part of the food chain.

“This study is alarming because similar health effects seen in fish, sea otters and harlequin ducks following the Exxon Valdez spill in Alaska were predictive of population impacts, from decline to outright collapse,” he said in a written statement.

So, we’ll leave those living with dispersant and oil toxins alone awhile and move to Georgia where there’s a radioactive leak of “unknown size”.  Minxy, you might want to get a Geiger counter and buy bottled water.  Tritium is said to be 200x over the EPA limit right now.

Radioactive water found beneath Georgia nuclear Plant Hatch, Associated Press, September 30, 2011:

[Emphasis added]

Radioactive water has been found underneath [Hatch nuclear power plant]  in southeast Georgia […]

[The operator] identified radioactive tritium in two test wells about 25 feet below the ground, said Dennis Madison, a utility vice president who oversees the plant. […]

How much is leaking?

  • While the size of the leak was unknown, it was enough to raise the water table in the wells about five feet.
  • “We really don’t know what the rate is,” Madison said. “We know it’s more than a drip.”

How concentrated is the leakage?

The maximum concentrations of tritium reported inside the wells was more than 200 times the limit set by the U.S. Environmental Protection Agency for drinking water […]

So, here’s some quotes about the health of the economy from people you should know (i.e. Wall Street insiders) that was sent to me by one of our readers.

#1George Soros: “Financial markets are driving the world towards another Great Depression with incalculable political consequences. The authorities, particularly in Europe, have lost control of the situation.”

#2 PIMCO CEO Mohammed El-Erian: “These are all signs of an institutional run on French banks. If it persists, the banks would have no choice but to delever their balance sheets in a very drastic and disorderly fashion. Retail depositors would get edgy and be tempted to follow trading and institutional clients through the exit doors. Europe would thus be thrown into a full-blown banking crisis that aggravates the sovereign debt trap, renders certain another economic recession, and significantly worsens the outlook for the global economy.”

#3Attila Szalay-Berzeviczy, global head of securities services at UniCredit SpA (Italy’s largest bank): “The only remaining question is how many days the hopeless rearguard action of European governments and the European Central Bank can keep up Greece’s spirits.”

#4Stefan Homburg, the head of Germany’s Institute for Public Finance: “The euro is nearing its ugly end. A collapse of monetary union now appears unavoidable.”

#5 EU Parliament Member Nigel Farage: “I think the worst in the financial system is yet to come, a possible cataclysm and if that happens the gold price could go (higher) to a number that we simply cannot, at this moment, even imagine.”

As I’m writing this, the Hong Kong exchange is down to its May lows.  The global markets and finance gods are not happy.  Frankly, I’m still thinking a coffee can buried in your back yard may be your best investment for awhile. I have no idea how President Obama is going to get reelected if this keeps up.  His message and policies just don’t stand up to current events.  But, hey, look over there.  Another Islamic Terrorist is toast, feel safer? Frankly, I’m not too worried that Al Qaeda will be after me and my bags and my grocery cart with my fat cat Miles in the kiddie sit.

Oh, here’s my personal favorite.  Try not to panic.

Ann Barnhardt, head of Barnhardt Capital Management, Inc.: “It’s over. There is no coming back from this. The only thing that can happen is a total and complete collapse of EVERYTHING we now know, and humanity starts from scratch. And if you think that this collapse is going to play out without one hell of a big hot war, you are sadly, sadly mistaken.”

If you’re curious about what the difference is between Operation Twist and QE2--no, they are not recreational activities–from the FED here’s a post that might interest you. Doubt it will make much difference because treasuries are still the place to be and we’re still at the zero bound, but at least some one’s doing something.  Basically, the FED’s trying to twist the yield curve and if you’ve had macroeconomics 101, here’s the exact moves.

Is this different from quantitative easing? QE2 was equivalent to the combination of two open market operations:

  • (1) Buying short-term Treasuries with newly created money.
  • (2) Swapping short-term Treasuries for longer-maturity ones.

The Fed’s new policy is just operation (2), disconnected from (1). Operation Twist is less effective than a potential QE3, therefore, to precisely the extent that operation (1) makes a difference.

Does it? First, let’s be even more precise, breaking down (1) into two smaller components:

  • (1A) Buying T-bills (extremely short term Treasuries with duration less than a year) with newly created money.
  • (1B) Swapping T-bills for a broader mix of short-term Treasuries (e.g. those with remaining maturity “3 years or less”).
  • (2) Swapping short-term Treasuries for longer-maturity ones.

You should be able to see that it’s just basically rearranging the chairs on the Titanic.  It’s an asset swap. But, there’s all this wishful thinking that it will send a message to the markets that the FED is serious and tame the deficit hawks a little. Remember that herd I wrote about last weekend?  That’s kind of what the Fed is betting on. Plus, they’re hoping that the twist will stop Perry from threatening their Chairman with bodily harm.

Nice to know that our health and national security is of no concern to our corporate overlords, isn’t it? So, there’s what’s on my mind today.  What’s on your reading and blogging list today?

Guess who Started the Class War?

Posted: October 2, 2011 | Author: | Filed under: U.S. Economy | Tags: , , | 19 Comments

It’s more than a bit disingenuous to start screaming class war now when the first shot was fired some years ago and the little guys are just finally waking up to the smell of $10 cappuccinos on $5 an hour wages. The data shows the income gap has been persistent and widening since the 1980s.  The only thing new under the sun is that the folks that started the entire thing are the ones screaming and shifting blame.

I’ve found some pretty fuzzy math that argues that Barack Obama–of ALL people–has just declared a class war some time this month by the preeminent defenders of the looting.  I thought I’d just share some of the intellectual shenanigans to inspire the pitch folk wielder in you.   This is one little whiny boy who complains the rich are just overtaxed today.  He even trots out some really really bad data to support the temper tantrum.

It’s official: America is at class war, and President Barack Obama proudly leads the charge against this country’s wealthy.

“If asking a millionaire to pay the same tax rate as a plumber makes me a class warrior ― a warrior for the working class ― I will accept that,” Obama shouted Tuesday at Denver’s Abraham Lincoln High School. “I will wear that charge as a badge of honor.”

“Middle-class families shouldn’t pay higher tax rates than millionaires and billionaires. A teacher or a nurse or a construction worker making $50,000 a year shouldn’t pay higher tax rates than somebody making $50 million.”

Obama’s assault on the affluent rests upon a sky-high stack of lies. Obama is too well staffed and too well informed not to know otherwise. So, maddeningly, he straight-out lies to the American people.

For days before Obama opened his mouth in Denver, multiple news accounts and opinion pieces annihilated the casus belli of his War on the Wealthy. Nonetheless, Obama keeps spouting falsehoods, perhaps hoping that his smooth voice will hypnotize Americans into believing his words.

“Fact check: The wealthy already pay more taxes,” read the headline above a September 20 Associated Press. “President Obama says he wants to make sure millionaires are taxed at higher rates than their secretaries,” Stephen Ohlemacher wrote. “The data say they already are.”

Nationwide, Ohlemacher and others dismantled Obama’s soak-the-rich thesis. The rich are soaked today.

Okay, the author of this stupid bit of faux economics is a “media fellow with the Hoover Institution on War, Revolution and Peace at Stanford University.”  He makes THE cardinal dumb mistake for the economic illiterate. He makes no distinction between real and nominal figures which basically means adjusting for changes in purchasing power to dollar figures over time but what do you expect from two ideological journalists.  The other idiot he quotes does the same thing.  You can’t do these kinds of figures in nominal terms and compare anything.  Here’s Paul Krugman explaining the difference between the value of a dollar today and a dollar around world war 2 which is what seems to really confuse these guys.

As background, it helps to know what has been happening to incomes over the past three decades. Detailed estimates from the Congressional Budget Office – which only go up to 2005, but the basic picture surely hasn’t changed – show that between 1979 and 2005 the inflation-adjusted income of families in the middle of the income distribution rose 21 percent. That’s growth, but it’s slow, especially compared with the 100 percent rise in median income over a generation after World War II.

Meanwhile, over the same period, the income of the very rich, the top 100th of 1 percent of the income distribution, rose by 480 percent. No, that isn’t a misprint. In 2005 dollars, the average annual income of that group rose from $4.2 million to $24.3 million.

So do the wealthy look to you like the victims of class warfare?

Paying more in dollars today doesn’t amount to the same thing as paying more in purchasing power and real income today and yesterday.  Additionally, the argument does not take into account the differences in taxes where the money really lies.  First, corporations have weaseled so many exceptions to the tax law, many pay next to nothing in taxes. Corporations are supposed to be people now remember?  Well, they dodge taxes in a big way. Second, most extremely wealthy people get the majority of their income from capital gains and not earned income.  It’s so easy to throw around numbers when you narrow your argument down to a place that ignores the big picture.  One of the biggest problems with this argument is that it ignores the other taxes collected by the federal government.  Social Security Taxes are the most regressive taxes in the country.  They apply only to 100% of the lowest levels of income.   The majority of rich people’s income avoids this tax.  The Social Security cap effectively puts most of the earned income of the wealthiest individuals off the table.  For some reason, Social Security always counts wrong against the federal deficit for these guys but gets ignored in the federal tax equations.

Krugman has argued against the use of fuzzy math a lot on his blog.  Here’s another good example on the Distribution Effect of Tax Cuts.   Again, focusing on one narrow tax and ignoring the rest is fuzzy math.  Also, ignoring the favoritism implied in all the latest tax cut laws is presumptuous.

Another, more subtle trick involves comparing percentage changes in taxes as opposed to tax changes as a percentage of income.

The starting point is that federal taxes are indeed progressive on average (although there are billionaires who pay a lower rate than their secretaries). And this in turn means that you have to be careful about the question when evaluating a change in taxes.

Suppose that it’s 1979, and individual A is a member of the working poor, paying 12 percent of his income in taxes — basically payroll tax and not much else. Meanwhile, individual B is very wealthy, and pays 40 percent of his income in taxes — as the very wealthy did on average 30 years ago.

Now suppose that 30 years of conservative governance lead to a fall of a quarter in both individuals’ average tax rates; A’s rate falls from 12 to 9, B’s from 40 to 30. Would it make sense to say that they have gained equally from tax cuts?

Clearly not. A’s after-tax income has risen from 88 to 91 percent of pretax income, a gain of 3.4 percent. B’s after-tax income has risen from 60 to 70 percent of pretax income, a gain of 16.7 percent. The distribution of after-tax income has become substantially less equal. And that’s the calculation I was doing here.

Now, right-wingers come back and say that this is what has to happen when you cut taxes. No, it doesn’t. And anyway, cutting taxes is itself a choice — and they’re a choice that then leads to demands that we cut programs for the poor and middle class to close the deficit those tax cuts created.

The point is that yes, tax policy these past 30 years has been very much tilted toward benefiting the rich.

Here’s another perspective on that from a letter to the editor in a small daily in Prescott Arizona.  I’m taking this as an example because it’s becoming clearer that more people get this and aren’t falling for the memes.

In this newly announced war, the rich are being cast as victims. Yet the top 1 percent of American taxpaying households has been able to use the power of its wealth to influence government to cut its tax rate by 100 percent in the past generation and a half. In actuality, this groups pays only 17 percent of its income in income taxes. In the past 30 years, the income of the top one percent has increased 256 percent and their percentage of our nation’s wealth has grown from 20 percent to 40 percent.

The story is not the same for middle-class Americans. Their income has moved upward a mere 11 percent in the same time period. The wealth of the middle class resides in its owner-occupied homes. Foreclosures and declining real estate values continue to erode the holdings of the middle class. Since most middle class Americans receive wages, there is little opportunity to reduce their taxes beyond the tax rate applicable to their income.

The number of Americans falling below the poverty line has continued to grow. According to the 2010, census more than 46 million Americans live below the poverty line; or one in six.

Class warfare is indeed a fact in our nation. However, it was not initiated by President Obama. It is a fact in long standing. If Paul Revere were sounding the alarm today, he’d be about 30 years too late.

One of the most disingenuous class war memes out there came one of the truly evil people in Congress these day.  That would be Eric Cantor who suggests that taxing the rich would shut down Soup Kitchens.  If you have ever done any analysis on the types of donations given by the rich compared to that given by the rest of us you’d see pretty clearly that the rich tend to skew their donations to art and culture nonprofits. Again, we have silly arguments that ignore the big picture.

Cantor complained about the president’s proposal to limit the value of the deduction for charitable deductions (and other deductions and some exclusions) to 28 percent. That would raise the cost of giving a dollar to 72 cents because the proposal would cut the tax savings to 28 cents. The higher price of giving would likely induce people to give less (at least in total—we don’t know whether they’d cut their donations to soup kitchens).

But that logic extends to other proposals to change tax rates. By Cantor’s own logic, tax policies that he supports could also harm soup kitchens by reducing donations. Cutting the top tax rate to 25 percent, for example, would raise the cost of giving to 75 cents per dollar, leading high-income donors to give less. (That reduction would be partly offset by what economists call the “income effect”—lower taxes raise after-tax incomes, so people give more because they have more to give. But the “price effect” from raising the cost typically outweighs the income effect.)

Another example: Allowing the 2001-03 tax cuts to expire for high-income taxpayers, which the president has repeatedly proposed and which Cantor opposes, could help charities. Boosting the top tax rate to 39.6 percent would lower the cost of giving and increase contributions. (Again, an income effect would offset at least some of the gain—higher taxes reduce after-tax income so people give less.)

In any case, it’s not soup kitchens that should worry about lower donations from the rich. More than 60 percent of donations in 2005 for basic needs came from people with income under $200,000, according to a 2007 study by the Center on Philanthropy at Indiana University. In contrast, more than 80 percent of contributions to health organizations and more than 90 percent of those for education and the arts were from people making more than $200,000. Those groups have a lot more to fear from reduced tax savings for donations.

Maybe it’s silly to complain that cutting tax rates would hurt charities by leading people to give less. But Cantor’s complaint that the president’s plan would go after soup kitchens in perilous economic times is equally silly. Both arguments are true, but both ignore larger points.

It’s truly odd that a man that wants to eliminate the safety net programs is concerned about shutting down a few Soup Kitchens. Again, the real problem is the rules that let folks like hedge fund managers avoid taxes like crazy when millionaire doctors and business owners have to search for deductions to bring down their tax bill. It wouldn’t exactly bring a windfall amount of revenues but it would at least make the tax system more reasonable.

The Top 400 tax filers  – the very richest Americans – do pay a lower rate of just 18.11 percent of their total income.  Why?  Many of them are hedge fund managers and people like Buffet — their income is pegged how much their investment fund grows.  For some reason, this income is counted as so-called “carried interest” (even though it is not interest at all; it’s more like a performance bonus) and is taxed at the lower 15 percent capital gains rate.

It’s a loophole for hedge managers, pure and simple.  But while it may be an outrage that these uber-rich hedge fund managers pay such a low rate compared to the rest of us, there are just not many of them out there.

But the top 400 tax filers represent a tiny sliver – just .00028 percent of all filers. The vast majority of those earning over $1 million a year pay at a higher rate, which is why the average tax rate for this group, according to the Tax Foundation, is 29.1 percent of taxable income.  And, yes, this number includes income taxes, payroll taxes and capital gains taxes.

So, most of the rich do contribute a good share of their income to taxes. The real conversation should be given the situation our country is in, given the level of taxes in the past, given that the wealthy actually benefit more from everything the country has to offer including its public goods, and given that these lower tax rates have really not produced any thing but bad results, why frame a return to more reasonable rates as “class warfare”?

I think this can be seen in terms of a bigger issue of the new right wing “populism” being driven by monied interests.  Many Fox newscasters and Tea Party types are actually very wealthy people who benefit from the demagoguery they promote.  It’s not so much “populism” as it is creating tension between classes of “have-nots”.  This class war far meme is just the latest in their attempt to get every one’s eye off the things that have really lowered US incomes and standards of living for 98% of the populace.  Cries of unfair taxation take every one’s attention from the real issues and problems.  As long as the political and power centers of the country are enclaves of rich, wealthy, sheltered elites, their media, their agendas, and their memes will be voiced in the corporate media and their interests will garner political attention.

← Older Entries
Newer Entries →