Tuesday, September 23, 2008

BREVITAS

CRASH TALK

One of the scariest things we've heard: ""I think we have to recognize the reality that we don't have a choice now of debating whether this is a good or a bad thing." - Barnie Frank, chair of House Banking Committee

Wall Street Journal - The Federal Reserve, unleashing its latest attempt to inject more cash into the nation's ailing banks, loosened longstanding rules that had limited the ability of buyout firms and private investors to take big stakes in banks. It marks the latest move by the Fed to rewrite the rulebook in response to the financial crisis. Regulators have grown worried about a shortage of capital at banks, in particular smaller thrifts and regional institutions. The Fed has been crafting this policy for at least two years, and private-equity firms have been aggressively lobbying for more lenient policies.

John Halle - What is missing from all of the discussion is any mention of how the plan will be paid for, as it is taken for granted that the average taxpayer is sure to be stuck with the ultimate cost of the $700 billion dollar price tag. But we don't need to pay. And in this case we should not. For very few Americans have benefited from the giant casino which Wall Street has become over the past generation. Yes it has spun off enormous wealth but this has gone overwhelmingly to a small number at the top. . . It is time to make those who have danced their jigs on our backs pay the fiddler. And that means that not one dime of the bailout should come from the 99.9% of Americans who are the victims of Wall Street. All of it should come from the enormous store of assets controlled by the upper . 1%.

The way to do this is by instituting a wealth tax - a tax on accumulated assets above $10 million. . . Eight-figure salaries have been routine in investment banking firms for two decades with Henry Paulson himself having earned $35 million in 2005 on the road to socking away accumulated assets of more than $700 million (not including stock options). His Democratic Party counterpart and predecessor at Goldman Sachs, key Obama advisor Robert Rubin, received similar compensation before moving to Citibank, where his wealth ballooned still further. Hedge fund operators, who have benefited from the absurd exemption on capital gains tax, have accumulated wealth beyond their dreams of avarice, one of them, John Paulson, of Paulson & Co. raking in a cool $3.7 billion for one years work. . . Simple arithmetic demonstrates that more than enough is available from these and other charter members of the plutocracy to fully finance the bailout, as well any additional items those with sufficiently resourceful minds would like to make part of the package.. . . Pushing for all of this, and more, should be the bottom line of progressives right now and we should be in the streets and in our representative offices demanding it.

Dean Baker, Prospect - The Washington Post complained in a front page article that the Presidential candidates have not adjusted their tax and spending plans to accommodate the new fiscal realities implied by the bailouts. The article calls for them to advocate spending cuts and/or tax increases. While this reflects the Post's editorial position, it is not clear that it reflects the fiscal and economic reality. At this point, neither the Post or anyone else knows how much a bailout will cost. It is possible that it will be structured so that most of the burden will be placed on the banks. The Post also doesn't know how severe the current recession will be. There are few economists who would advocate cutting spending or raising taxes in the middle of a serious recession. In short, this article is reflecting the editorial perspective of the Post, not economic or fiscal necessities.

Wall Street Journal - With stocks falling, credit tightening and unemployment rising, small investors have been raiding their 401(k) accounts or slashing contributions to the popular retirement plans, according to the latest tallies of plan administrators. Others, eager to shield their portfolios from further damage, are reducing their exposure to stock mutual funds to near record lows. The behavior -- described by some market watchers as panicky in the past week -- has led to worries that the retirement prospects are dimming further for Americans, most of whom no longer have private-sector pensions to rely on. Recent 401(k) winnowing is coming in the form of "hardship withdrawals" -- removing cash from the fund, with a 10% tax penalty, for exigencies such as job loss, the prospect of losing your home to foreclosure or a big medical expense.

Wall Street Journal - "Is there anyone who isn't a backlasher?" asked Jared Bernstein, senior economist at the Economic Policy Institute, a left-of-center think tank. "I haven't seen people saying, 'Good plan -- like it.'"Mr. Bernstein noted that the government is in a bind: Paying rock-bottom prices for shaky mortgage-backed securities might hurt the firms that the bailout is supposed to rescue, but if the government pays a higher price, taxpayers might end up with securities it can't resell except at a big loss.

"I think it's awful," said Allen Meltzer, a former Reagan economic adviser now teaching at Carnegie Mellon University. "It puts private interests ahead of the public interest." Mr. Meltzer pointed to past occasions when, he said, doomsayers warned of financial panic, the government resisted the urge to bail out the markets, and nothing terrible ensued. Among those he cited was President Richard Nixon's decision not to rescue the commercial-paper market in the aftermath of the collapse of the Penn Central railroad.

Former St. Louis Federal Reserve Bank President William Poole, a senior fellow at the free-market Cato Institute, said, "The Treasury will be stuck with the least-attractive paper, and that means taxpayer losses will be large."

C. Fred Bergsten, director of the Peterson Institute for International Economics, called the package essential, given the unusual circumstances. He predicted taxpayers would ultimately be on the hook for about $100 billion, once the government resells the securities it plans to take off financial firms' hands.

Rep. Frank said the Treasury agreed to an independent board to monitor the bailout and report on its progress to Congress and the public. The board wouldn't have authority to veto Treasury investment decisions, and the bailout's launch wouldn't be delayed while a board was being put in place.

While details are still being worked out, both sides have also agreed to a measure that would allow -- but not require -- the Treasury to take an equity stake in a financial institution that sells assets to the government. Whether it did so might be dependent on the size of the capital injection the government makes when it buys the assets, according to a person familiar with the matter.

OUTLYING PRECINCTS

Stateline
- Hoping to boost voter turnout in a historic presidential election year, civil rights groups and other advocacy organizations are trying to get as many ex-felons as possible to cast ballots in November. . . Both in little-contested states such as Texas and in perennial presidential-election battlegrounds such as Ohio, activists are knocking on doors trying to find former prisoners and inform them of their voting rights, visiting state prisons and jails to speak with soon-to-be-released inmates and helping to register those who are interested and allowed to vote. Looking beyond November, the American Civil Liberties Union is waging a broader campaign to persuade state legislatures to do away with so-called felony disenfranchisement laws, which keep an estimated 5.3 million Americans with felony convictions from the polls, including 2.1 million who no longer are in prison. Only two states -Maine and Vermont -allow incarcerated felons to vote. . . Eleven states restrict ex-offenders' voting rights even after their sentences are served: Kentucky and Virginia bar almost all ex-felons from going to the polls, unless they petition the governor to restore their rights, while nine states either ban some ex-felons from voting or have waiting periods before they can vote again. In addition, 35 states prevent parolees from voting, while 30 ban those on probation from casting ballots.

Rob Richie, Fair Vote
- The Washington Post has a front page article on its new poll in the tight presidential race in Virginia -one that is newsworthy in showing Democrat Barack Obama leading Republican John McCain in a state that a Democrat hasn't carried since 1964. The Post highlights Obama's lead as 3% (49% to 46%), showing that result in a page one chart. Then, as an aside on page A6, it reports "When third-party candidates - Ralph Nader and Bob Barr - were included in the questioning. Obama edged to a five-point lead." Nader and Barr in fact are on the ballot in Virginia, as they each are in at least 45 states according to Ballot Access News. So are the Green Party's Cynthia McKinney and the Constitution's Party's Chuck Baldwin, who recently picked up the endorsement of former Republican presidential candidate Ron Paul. Why on earth wouldn't the poll lead with the full results as its main story? Which is more accurate: reporting the results of a hypothetical two-candidate election or reporting the results of what voters will actually see on their ballot - and indeed are seeing on their ballot, as early voting has already begun in Virginia?

USA Today
- Voters by the thousands will begin casting ballots for president this week in an early voting process that's expected to set records this year. Residents of Virginia, Kentucky and Georgia are among the first in the nation eligible to vote in person, as well as by mail. During the next few weeks, at least 34 states and the District of Columbia will allow early in-person voting for Nov. 4 elections. Experts such as Paul Gronke of the Early Voting Information Center predict nearly a third of the electorate will vote early this year, up from 15% in 2000 and 20% in 2004. In closely contested Colorado, Nevada and New Mexico, about half the voters are expected to cast ballots before Election Day. Florida could be 40%.

Governing
- The [Vermont] poll shows Republican Gov. Jim Douglas at 48%, Democrat Gaye Symington at 33% and independent Anthony Pollina at 7%. In any other state this would be unequivocally good news for Douglas. In Vermont, though, if no gubernatorial candidate makes it past 50%, the election is thrown into the state House of Representatives. With 12% still undecided, Douglas isn't in bad shape, but there's a realistic chance state legislators will be deciding this one. . . The best news for Douglas is that it looks increasingly likely that he will be the candidate who gets the most votes, which, from a public relations standpoint, would put him in an excellent position to win a vote in the House (despite the large Democratic majority).

Political Wire
- Gov. Sarah Palin drew a crowd of nearly 60,000 people to a rally she held in the battleground state of Florida, according to the Fort Myers News-Press.

Maine Today - Republican John McCain's campaign claims the endorsement of the Maine Snowmobile Association, which has more than 30,000 members. Snowmobilers Executive Director Bob Meyers says McCain and Sarah Palin are on the side of the snowmobilers when it comes to public access to land for recreation.

THE MIX

AJ Press
- The percentage of Californians opposing a constitutional amendment that would reinstate a ban on same-sex marriages have grown over the past year, according to the Field Poll, an independent and nonpartisan organization. The surveys revealed that 55 percent of Californians opposed while 38 percent favored Proposition 8, the initiative to ban same-sex marriage In May, the Field Poll's first survey on the subject found that 51 percent had opposed the proposition.

Ms Magazine
- The United Nations Development Fund for Women has released a report that details an increase in women's participation in politics by 8 percent worldwide since 1998. Globally, 18% of parliament-level officials are women. . . Ellen Johnson Sirleaf, President of Liberia, is quoted in the report: "Half, even more than half, of 'the people' are women. Yet for far too long, women's will, women's voices, women's interests, priorities, and needs have not been heard, have not determined who governs, have not guided how they govern, and to what ends. Since women are amongst the least powerful of citizens, with the fewest social and economic resources on which to build political power, special efforts are often needed to elicit and amplify their voice."

Black Press USA -
A group of seasoned black community activists and organizers will gather in New Orleans Nov. 19-23 well after the Nov. 4 election - to discuss the "state of the black world." . . . "We're excited about the prospect of Obama winning the White House," says Dr. Ron Daniels, convener of the conference. "But we must work to create and advance a progressive black agenda no matter who wins the White House. . . We must not make the mistake of believing that the new president will be able to resolve all our problems without a powerful grassroots movement to promote our agenda."

THE WORLD

Reuters
- Russian warships set sail on Monday for maneuvers in the Caribbean area calculated to demonstrate to the United States Moscow's return as a global power on the military and political stage.The exercises, drawing on a strong alliance with Venezuela's anti-American President Hugo Chavez, will be closely watched by Western navies as the first such projection of Russian power close to U.S. shores since the collapse of the Soviet Union. Navy spokesman Igor Dygalo said the nuclear-powered heavy missile cruiser Peter the Great and antisubmarine destroyer Admiral Chabanenko left their base near Murmansk with two support ships for the 15,000 mile passage to Venezuela. Washington denounced Moscow for its crushing of pro-Western Georgia in a brief conflict last month over two rebel provinces. Russia then expressed anger over the appearance of U.S. warships in the Black Sea region -- which it considers its sphere of influence -- to deliver aid to Georgia.

SCHOOLS & THE YOUNG

BBC - Tiffin boys' school, in Kingston, south west London, has limited homework to 40 minutes per night, saying pupils should have more time for their own interests. Head teacher Sean Heslop said boys had been doing up to four hours a night, and that what had been set was often "mechanistic" and "repetitive". Homework is not compulsory in England's schools but is officially encouraged. The government's guidelines for schools in England say children should be doing homework from the day they start primary school. . . But research has cast doubt on its effectiveness, and has even suggested that too much is counter-productive. Some independent schools have abolished the practice. And earlier this year a teaching union, the Association of Teachers and Lecturers, called for an end to homework in primary schools and for it to be scaled back in secondary schools. Mr Heslop said the school had spent two years looking at teaching and learning in class time which inevitably had led staff to look at what homework was being set. Now it sets just 40 minutes per night plus 20 minutes of independent learning, which could include playing music or doing sport, for example. . . "The boys absolutely love it. But there has been a mixed response from parents."

BOOKS

Public Housing That Worked:
New York in the Twentieth Century

ARTS & CULTURE

Boing Boing
- Boris Kachka's long feature on NY publishing's crisis in New York Magazine is a sad but important read. But Kachka puts a lot of emphasis on greed and foolishness and media and bookstore consolidation, while ignoring the largest contraction in book-sales since the heyday: sales through non-bookstore venues like Wal-Mart and the local grocery store. Historically, these outlets have sold more books than bookstores, and were a vital induction system that coaxed people who didn't (yet) love books into the bookstores. When these chains went national, they demanded national distributors to stock them from coast-to-coast. The result: a huge shift in the way these shelves are stocked: once stocked by local distributors who chose from a very wide range of titles and hand-picked the right books for each little grocery store and pharmacy, now they are supplied by a national database totalling somewhere around 100 titles. The consolidated distributors demand gigantic discounts from publishers -- and even so, they go bankrupt with dismal regularity, often with FBI arrests of top execs for corruption.

MONEY & WORK

Mark Weisbrot, Portside -
"Battle in Seattle" opens in movie theaters across the country, a rare combination of high drama and history-making events as they actually happened when thousands of protesters shut down the World Trade Organization in Seattle nearly nine years ago. It has an all-star cast including Oscar-winning beauty Charlize Theron, Woody Harrelson, Michelle Rodriguez, Ray Liotta, and Andre Benjamin (of Outkast hip-hop fame). Perhaps most unusual for a feature film, it gives the protesters credit for what they accomplished: they changed the debate over what has been deceptively marketed as "free trade." They were beaten and jailed, choked with tear gas and shot with rubber bullets, but they succeeded in raising awareness about what these organizations and international agreements really do.

0 Comments:

Post a Comment

<< Home