PLEASE FORGIVE THIS ABBREVIATED VERSION. MY INTERNET CONNECTION HAS BEEN ON THE BLINK ON AND OFF ALL DAY!! GRRRRR
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The United States will likely suffer the loss of its triple-A credit rating from another major rating agency by the end of this year due to concerns over the deficit, Bank of America Merrill Lynch forecasts.
A second downgrade — either from Moody’s or Fitch — would follow Standard & Poor’s downgrade in August on concerns about the government’s budget deficit and rising debt burden. A second loss of the country’s top credit rating would be an additional blow to the sluggish U.S. economy, Merrill said.
“The credit rating agencies have strongly suggested that further rating cuts are likely if Congress does not come up with a credible long-run plan” to cut the deficit, Merrill’s North American economist, Ethan Harris, wrote in the report.
“Hence, we expect at least one credit downgrade in late November or early December when the super committee crashes,” he added.
The bipartisan congressional committee formed to address the deficit — known as the “super committee” — needs to break an impassebetween Republicans and Democrats in order to reach a deal to reduce the U.S. deficit by at least $1.2 trillion by November 23.
Those automatic cuts, mostly in discretionary spending, would weigh further on a fragile U.S. economy, Merrill said. In the same report, the bank reduced its 2012 and 2013 growth forecasts for the United States to 1.8 percent and 1.4 percent, respectively.
Moody’s Investors Service, which has a negative outlook on the United States’s Aaa rating, said it is looking at several other factors, including the results of presidential elections and the expiration of the Bush-era tax cuts late in 2012, to decide on the rating.
To be sure, Hess did not rule out the possibility of an early move on U.S. ratings if the country’s economy slips into recession. So far, however, the economic performance “is certainly not super positive but not a disaster either,” he said.
meaning it is more likely to revise that outlook to negative before actually downgrading the rating.
In its latest report on the United States, Fitch says a “negative rating action,” which could be only an outlook revision, could result from a weaker-than-expected economic recovery or by failure by the bipartisan committee to reach agreement on at least $1.2 billion in deficit-reduction measures..
The People’s View:
Bank of America moved some derivatives from its Merrill-Lynch subsidiary to its depository bank and the so-called “progressive” blogs became very upset. One problem with their reporting is that apparently none of the “Progressive” financial experts understands what”notional” means so they really over-state how much money is at risk. But more importantly, they don’t seem to understand what the Dodd-Frank law does. Contrary to what Yves Smith or Susie Madrak or any of the many others who wrote the same story say, the taxpayers and the FDIC are definitely not accepting additional risk – at least under the circumstances described in the Bloomberg article. The Democratic Party and the Obama administration, over bitter opposition from the Republicans and Wall Street changed the law to make stock and bond investors and corporate management liable when systematically important financial companies fail. Dodd-Frank is far from perfect, but there is a reason the Republican representatives of Wall Street hate it so much.
Smith’s key point is that the 2005 bankruptcy law gives owners of derivatives (“derivatives counter-parties”) a ticket the the head of the queue in a bankruptcy. Her argument is that these provisions mean that the counter-parties will grab the assets of the the bank, leaving the FDIC with the debts and the cost of guaranteeing deposits. But that’s something the Dodd-Frank bill fixes. Here’s Smith:
This move reflects either criminal incompetence or abject corruption by the Fed. Even though I’ve expressed my doubts as to whether Dodd Frank resolutions will work, dumping derivatives into depositaries pretty much guarantees a Dodd Frank resolution will fail. Remember the effect of the 2005 bankruptcy law revisions: derivatives counterparties are first in line, they get to grab assets first and leave everyone else to scramble for crumbs. So this move amounts to a direct transfer from derivatives counterparties of Merrill to the taxpayer, via the FDIC, which would have to make depositors whole after derivatives counterparties grabbed collateral. It’s well nigh impossible to have an orderly wind down in this scenario. You have a derivatives counterparty land grab and an abrupt insolvency. Lehman failed over a weekend after JP Morgan grabbed collateral.
The Dodd-Frank resolution provisions specifically permit the FDIC to (a) block “derivatives counterparties” from collecting collateraland (b) to move derivatives and other debts to a “bridge bank” which they create at the moment. This process is described in section 210 of the Dodd-Frank act – an act that specifically states that its provisions overrule any counter provisions of bankruptcy law. So the law anticipates that the FDIC will move derivative transactions to a new company where derivatives will “net out”. There is extensive discussion of this provision available online – for example here and here. Clearly, it is possible that the FDIC will not do its job properly, that the law won’t work out, or that there are problems in the resolution authority – but more clearly, it’s just plain wrong to cite the 2005 Bankruptcy act as the controlling law.
It’s also worth noting that most banks already have their derivatives in the bank and not in a trading company subsidiary and that even for BoA, most the of the derivatives exposure is already in the bank, not in the holding company or the subsidiary. Here’s the original Bloomberg article with bold added to make the point clear.
The White House Blog:
In a typical recession, this is how you expect a recovery to get its legs: Growing families begin to invest in new homes. That investment works its way through the economy. Builders, suppliers, realtors, and the broader community all benefit.
Today, that isn’t happening.
In 2006, the median home price in the United States was $227,100. By May of this year, that price had fallen to $158,700.
Already, at least 5 million people have lost their homes due to foreclosure, and today, one in every three homes purchased is the product of a short sale or a foreclosed property.
Worse still, across the country, nearly 11 million owe more than their property is worth.
Millions of these people have done everything right. They’ve paid all their bills and kept current on their home loans. But right now, they’re stuck with higher payments because their mortgages are underwater. They’re not eligible to refinance because the decline in home prices have made their property worth less than what they owe. And that’s a problem President Obama knows must be addressed.
All of these factors have contributed to a climate where new homes are being built at the lowest rate since World War II and where homeowners feel trapped by financial circumstances outside their control. Those two things together are holding back the recovery.
We can’t wait to help homeowners. The situation is too serious, and too much good can come from improving the state of housing in this country.
So today, President Obama is taking action. It starts with finding ways to allow homeowners to refinance their mortgages.
The Home Affordable Refinance Program is designed to do just that. To date, it’s already helped nearly 1 million homeowners improve their financial situations. But up until now, eligibility regulations and costs associated with the program have kept it from having a wider impact.
Now, a new set of rules will open the program to nearly anyone with a mortgage backed by Fannie Mae or Freddie Mac — no matter what they owe — so long as they are current on their payments, have no late payments in the last six months, and have not made more than one late payment in the past year.
The group that manages the program, the Federal Housing Finance Agency, will also waive a set of unnecessary costs and fees that were dissuading some from taking advantage of the program and work to get rid of certain restrictions in order to increase competition among lenders.
Millions of individuals could see up to $2,500 in savings every year.
But good as this program might prove to be, alone it won’t be enough. The thing that pushes most homeowners into foreclosure is unemployment. Knowing that, Congress still has the opportunity to pass a housing program with sweeping potential — the American Jobs Act.
Until they do, President Obama isn’t waiting on lawmakers to take action. Today’s announcement is just the start of things this Administration will do to get the economy growing again — even if Congress refuses to make jobs a priority.
What are the Occupy Wall Street protesters angry about? The same things we’re all angry about. The only difference is the protestors turned their anger into public action. Occupy Wall Street lit the embers and the sparks are flying. Whether it turns into a genuine populist prairie fire depends on all of us. […]
Here’s a brief list of why we should be angry and the charts to back it up.
1. The American Dream is imploding…
The productivity/wage chart says it all. From 1947 until the mid-1970s real wages and productivity (economic output per worker hour) danced together. Both climbed year after year as did our real standard of living. If you’re old enough, you will remember seeing your parents doing just a bit better each year, year after year. Then, our nation embarked on a grand economic experiment. Taxes were cut especially on the super-rich. Finance was deregulated and unions were crushed. Lo and behold, the two lines broke apart. Productivity continued to climb, but wages stalled and declined. So where did all that productivity money go? To the rich and to the super-rich, especially to those in finance.
2. Our wealth is gushing to the top 1 percent…
Actually the top tenth of one percent. Because of financial deregulation and tax cuts for the rich, the income gap is soaring. Here’s one of my favorite indicators that we compiled for The Looting of America. In 1970 the top 100 CEOs earned $45 for every $1 earned by the average worker. By 2006, the ratio climbed to an obscene 1,723 to one. (Not a misprint!)
3. Family income is declining while the top earners flourish…
4. The super-rich are paying lower and lower tax rates…
5. Too much money in the hands of the few combined with financial deregulation crashed our economy…
When the rich become astronomically rich, they gamble with their excess money. And when Wall Street is deregulated, it creates financial casinos for the wealthy. When those casinos inevitably crash, we pay to cover the losses. The 2008 financial crash caused eight million American workers to lose their jobs in a matter of months due to no fault of their own. The last time we had so much money in the hands of so few was 1929!
6. We’re turning into a billionaire bailout society…
We bailed out the big Wall Street banks and protected the billionaires from ruin. Now we are being asked to make good on the debts they caused, while the super-rich get even richer, some making more than $2 million an HOUR! It would take over 47 years for the average family to make as much as the top 10 hedge fund managers make in one hour.
7. The super-rich still control politics…
8. Unemployment is a catastrophe…
The reckless gambling on Wall Street tore a hole in the economy sending millions to the unemployment lines. Wall Street caused the enormous spike in unemployment and no one else – not the government, not home buyers, not China.
9. Our prospects for the future are growing dim…
It’s bad enough that unemployment is sky-high. But it’s even worse when you can’t find a job for months, even years. Right now the number of unemployed for 26 weeks or more is at record levels. Many of the long-term unemployed will never work again.
10. The big banks are getting even bigger…
Says 24 million people in this country “can’t find a full-time job,” 50 million “can’t see a doctor when they’re sick,” 47 million people need government help to feed themselves and 15 million families owe more than the value of their home.
As anyone knows who has ever had to set up a military encampment or build a village from the ground up, occupations pose staggering logistical problems. Large numbers of people must be fed and kept reasonably warm and dry. Trash has to be removed; medical care and rudimentary security provided—to which ends a dozen or more committees may toil night and day. But for the individual occupier, one problem often overshadows everything else, including job loss, the destruction of the middle class, and the reign of the 1 percent. And that is the single question: Where am I going to pee? […]
Of course, political protesters do not face the challenges of urban camping alone. Homeless people confront the same issues every day: how to scrape together meals, keep warm at night by covering themselves with cardboard or tarp, and relieve themselves without committing a crime. Public restrooms are sparse in American cities—”as if the need to go to the bathroom does not exist,” travel expert Arthur Frommer once observed. And yet to yield to bladder pressure is to risk arrest. A report entitled “Criminalizing Crisis,” to be released later this month by the National Law Center on Homelessness and Poverty, recounts the following story from Wenatchee, Washington:
Toward the end of 2010, a family of two parents and three children that had been experiencing homelessness for a year and a half applied for a 2-bedroom apartment. The day before a scheduled meeting with the apartment manager during the final stages of acquiring the lease, the father of the family was arrested for public urination. The arrest occurred at an hour when no public restrooms were available for use. Due to the arrest, the father was unable to make the appointment with the apartment manager and the property was rented out to another person. As of March 2011, the family was still homeless and searching for housing.
What the Occupy Wall Streeters are beginning to discover, and homeless people have known all along, is that most ordinary, biologically necessary activities are illegal when performed in American streets—not just peeing, but sitting, lying down, and sleeping. While the laws vary from city to city, one of the harshest is in Sarasota, Florida, which passed an ordinance in 2005 that makes it illegal to “engage in digging or earth-breaking activities”—that is, to build a latrine—cook, make a fire, or be asleep and “when awakened state that he or she has no other place to live.”
It is illegal, in other words, to be homeless or live outdoors for any other reason. It should be noted, though, that there are no laws requiring cities to provide food, shelter, or restrooms for their indigent citizens.
The current prohibition on homelessness began to take shape in the 1980s, along with the ferocious growth of the financial industry (Wall Street and all its tributaries throughout the nation). That was also the era in which we stopped being a nation that manufactured much beyond weightless, invisible “financial products,” leaving the old industrial working class to carve out a livelihood at places like Walmart.
As it turned out, the captains of the new “casino economy”—the stock brokers and investment bankers—were highly sensitive, one might say finicky, individuals, easily offended by having to step over the homeless in the streets or bypass them in commuter train stations. In an economy where a centimillionaire could turn into a billionaire overnight, the poor and unwashed were a major buzzkill. Starting with Mayor Rudy Giuliani in New York, city after city passed “broken windows” or “quality of life” ordinances making it dangerous for the homeless to loiter or, in some cases, even look “indigent,” in public spaces.
No one has yet tallied all the suffering occasioned by this crackdown—the deaths from cold and exposure—but “Criminalizing Crisis” offers this story about a homeless pregnant woman in Columbia, South Carolina:
During daytime hours, when she could not be inside of a shelter, she attempted to spend time in a museum and was told to leave. She then attempted to sit on a bench outside the museum and was again told to relocate. In several other instances, still during her pregnancy, the woman was told that she could not sit in a local park during the day because she would be “squatting.” In early 2011, about six months into her pregnancy, the homeless woman began to feel unwell, went to a hospital, and delivered a stillborn child.
Well before Tahrir Square was a twinkle in anyone’s eye, and even before the recent recession, homeless Americans had begun to act in their own defense, creating organized encampments, usually tent cities, in vacant lots or wooded areas. These communities often feature various elementary forms of self-governance: food from local charities has to be distributed, latrines dug, rules—such as no drugs, weapons, or violence—enforced. With all due credit to the Egyptian democracy movement, the Spanish indignados, and rebels all over the world, tent cities are the domestic progenitors of the American occupation movement.
There is nothing “political” about these settlements of the homeless—no signs denouncing greed or visits from left-wing luminaries—but they have been treated with far less official forbearance than the occupation encampments of the “American autumn.” LA’s Skid Row endures constant police harassment, for example, but when it rained, Mayor Antonio Villaraigosa had ponchos distributed to nearby Occupy LA.
All over the country, in the last few years, police have moved in on the tent cities of the homeless, one by one, from Seattle to Wooster, Ohio, Sacramento to Providence, in raids that often leave the former occupants without even their minimal possessions. In Chattanooga, Tennessee, last summer, a charity outreach worker explained the forcible dispersion of a local tent city by saying: “The city will not tolerate a tent city. That’s been made very clear to us. The camps have to be out of sight.”
What occupiers from all walks of life are discovering, at least every time they contemplate taking a leak, is that to be homeless in America is to live like a fugitive. The destitute are our own native-born “illegals,” facing prohibitions on the most basic activities of survival. They are not supposed to soil public space with their urine, their feces, or their exhausted bodies. Nor are they supposed to spoil the landscape with their unusual wardrobe choices or body odors. They are, in fact, supposed to die, and preferably to do so without leaving a corpse for the dwindling public sector to transport, process, and burn.
But the occupiers are not from all walks of life, just from those walks that slope downwards—from debt, joblessness, and foreclosure—leading eventually to pauperism and the streets. Some of the present occupiers were homeless to start with, attracted to the occupation encampments by the prospect of free food and at least temporary shelter from police harassment. Many others are drawn from the borderline-homeless “nouveau poor,” and normally encamp on friends’ couches or parents’ folding beds.
In Portland, Austin, and Philadelphia, the Occupy Wall Street movement is taking up the cause of the homeless as its own, which of course it is. Homelessness is not a side issue unconnected to plutocracy and greed. It’s where we’re all eventually headed—the 99 percent, or at least the 70 percent, of us, every debt-loaded college grad, out-of-work school teacher, and impoverished senior—unless this revolution succeeds.
Ezra Klein’s Wonkbook:
Earlier this summer, Sen. John Cornyn took to the Senate floor to rail against the 46 percent of Americans who pay no federal income taxes. “To show how out of whack things have gotten,” Cornyn (R-Tx.) said, “30 percent of American households actually made money from the tax system by way of refundable tax credits — the Earned Income Tax Credit, among others.” When he puts it that way, it sounds bad. People are leeching off the tax system?
But this turns out to be fairly misleading. A new study offers a more nuanced look at the role the Earned Income Tax Credit actually plays in the U.S. economy. The EITC, remember, is a refundable tax credit that helps supplement the income of poor employed workers with children. The formula’s a bit complicated, but a worker with two kids making $16,000 a year can get up to $5,036 back in taxes. As it turns out, a stunningly large number of Americans use the program.
“Approximately half of all taxpayers with children used the EITC at least once [between 1989 and 2006],” writes Indivar Dutta-Gupta of the Center on Budget and Policy Priorities. Most EITC beneficiaries only use it for a year or two, before scrambling up the income ladder. Workers were especially likely to use the EITC when their kids were very young. By and large, the program helps many workers get ahead, and it alleviates early-childhood poverty. You can see why it’s been so popular for so long among both parties — Ronald Reagan, for one, called it “the best anti-poverty, the best pro-family, the best job-creation measure to come out of Congress.”
And here’s the kicker. Contrary to what Cornyn’s suggesting, EITC beneficiaries don’t seem to be drains on the tax system. In the long run, they pay more in taxes than they receive in benefits. Here’s Indivar Dutta-Gupta again: “Taxpayers who claimed the EITC at least once during the 18-year period from 1989 through 2006 paid several hundred billion dollars in net federal income tax over this period.” It’s a little misleading to look at a single year, note that large numbers of people aren’t paying income taxes, and assume that they’re not paying their fair share. If programs like the EITC are helping people get richer, it can mean more tax revenue in the long term.
Banish the image of a classic American classroom from your mind—chalkboard, desks and all. The future of education has arrived, and next-era classrooms look like, well, call centers: students seated at individual corrals, some with headphones on, being taught and drilled on quadratic equations while a teacher monitors their progress from behind her own computer. With such individualized learning, students can absorb and master subjects “tailored to their pace and needs.”
That was the picture painted by billionaire businessman Rupert Murdoch when he spoke last week at a two-day conference in San Francisco hosted by former Florida Gov. Jeb Bush’s education reform outfit. Murdoch was there, he admitted upfront, as “a businessman” ready to move into the education market. Murdoch’s News Corp. has been quietly developing virtual-learning and technology-driven products for K through 12 schools, and with his address Murdoch made his first large public splash into an arena he’s valued at $500 billion. For entrepreneurs big and small, American public school reform has become a prime business opportunity.
And with help from lawmakers nurtured under Gov. Bush’s legislative guidance, it’ll soon be easier to pick up some of that cash. In an era of declining state budgets and in the face of an urgent educational crisis, Bush argued, now is the time for policy that allows schools to educate their students with cutting-edge digital programs that teach, test and track the progress of school kids for a fraction of the cost of traditional public schools. Bush urged the 750 attendees, most of them state and local school superintendents, education entrepreneurs and lawmakers from state legislatures, to pave the way for schools to adopt digital learning initiatives.
Conveniently, Murdoch and other businesspeople entering the education sector were on hand to sell their wares.
And soon, I realized I was falling under Khan’s spell. He’s an excellent salesman—charismatic and witty and a wonderful storyteller. I started thinking I might want to take up calculus with his YouTube videos, the first surprise, and then quickly wandered into even more challenging territory. I began to wonder: Is there anything inherently wrong with corporations running schools? So we privatize the education system. If corporations are able to do it successfully, is anything wrong with it?
Perhaps the best weapon the market-based reform movement holds is that no one has yet articulated a broadly compelling response to these questions, one that speaks to the urgent desire of individual parents to get their individual kids educated and the equally urgent need of cash-strapped states to pay for it. So far, there’s only one organized group that’s explicitly countering the privatization of U.S. schools, and they’ve yet to craft a rebuke that can overcome both the rhetorical appeal of the pro-business approach and the anti-public sector worker climate that’s gripped the nation. Teachers unions—whose members face ever harsher sanctions under clumsy and testing-focused accountability measures, and who are losing collective bargaining rights and job stability—have been portrayed as selfish and unwilling to change. That may not be the truth, but it’s certainly the dominant narrative.
At the conference, the villains were named explicitly as public educators—or, when haranguing panelists wanted to be more nuanced, as the unions that represent educators. Teachers were consistently portrayed as simultaneously lazy in the classroom and extremely powerful outside of it, resistant to change and ill-equipped to handle the challenges of educating students in the 21st century. The assembled legislators, school chiefs and entrepreneurs often referred to teachers unions as “the other side,” and themselves as the underdogs.
But while teachers are not winning the messaging war, they and other critics of market-based education reform have got data on their side. New studies show that digital learning companies have inflated their claims of success. Charter schools on average do no better than their often comparatively underfunded traditional public school counterparts. Over and over, studies have found that pay-for-performance schemes do not, in fact, make teachers more effective in the classrooms. Critics of punitive teacher accountability measures and market-based reform arguethat social factors—poverty, access to healthcare, family joblessness—have a significant influence on a student’s academic achievement, and that reforms that refuse to acknowledge that reality are doomed to fail.
But these days, the debate is not about any of these things. At its heart, it’s really about fundamental ideological differences over how traditionally public institutions ought to be run and who ought to be responsible for nurturing the nation’s students: publicly run schools accountable to voters and their communities, or private companies accountable primarily to their stockholders. As Indiana state superintendent Tony Bennett said on a panel with other state school chiefs, “We don’t believe we can run schools in the state. We develop contractual relationships with those who can.”
The previous afternoon, just steps away from the hotel ballroom, a protester held aloft a poster asking a question she likely never got an answer to: “The 1% ruined our economy. Why should we trust them with our schools?”
Republican presidential contender Ron Paul said Sunday he wants to end federal student loans, calling it a failed program that has put students $1 trillion in debt when there are no jobs and when the quality of education has deteriorated.
Paul unveiled a plan last week to cut $1 trillion from the federal budget that would eliminate five Cabinet departments, including education. He’s also wants young workers to be able to opt out of Social Security.
The student loan program is not part of those cuts, but Paul said Sunday on NBC’s “Meet the Press” that he’d kill the loan program eventually if he were president. That could put him at odds with some of his young followers, many of whom are college students.
Paul blamed government intervention in the economy for rising tuition.
[…] Absolute versus relative risk/benefit data
Many stories use relative risk reduction or benefit estimates without providing the absolute data. So, in other words, a drug is said to reduce the risk of hip fracture by 50% (relative risk reduction), without ever explaining that it’s a reduction from 2 fractures in 100 untreated women down to 1 fracture in 100 treated women. Yes, that’s 50%, but in order to understand the true scope of the potential benefit, people need to know that it’s only a 1% absolute risk reduction (and that all the other 99 who didn’t benefit still had to pay and still ran the risk of side effects).
Association does not equal causation
A second key observation is that journalists often fail to explain the inherent limitations in observational studies – especially that they can not establish cause and effect. They can point to a strong statistical association but they can’t prove that A causes B, or that if you do A you’ll be protected from B. But over and over we see news stories suggesting causal links. They use active verbs in inaccurately suggesting established benefits.
How we discuss screening tests
The third recurring problem I see in health news stories involves screening tests. … “Screening,” I believe, should only be used to refer to looking for problems in people who don’t have signs or symptoms or a family history. So it’s like going into Yankee Stadium filled with 50,000 people about whom you know very little and looking for disease in all of them. … I have heard women with breast cancer argue, for example, that mammograms saved their lives because they were found to have cancer just as their mothers did. I think that using “screening” in this context distorts the discussion because such a woman was obviously at higher risk because of her family history. She’s not just one of the 50,000 in the general population in the stadium. There were special reasons to look more closely in her. There may not be reasons to look more closely in the 49,999 others.
Two excellent things to read this morning about immigration as an issue, and how it is playing out in the Republican nomination contest and how it may affect the general election. Ed Kilgore has been (correctly I believe) emphasizing the effects of Rick Perry’s immigration policy and comments on his recent collapse in the polls; Jamelle Bouie has a good item focusing on the general election effects of Republican politicians alienating potentially sympathetic Latino voters. I recommend both.
What strikes me as interesting about immigration as an issue is the contrast with abortion, which has also been in the news lately thanks to Herman Cain’s inability to talk about it properly. Sarah Kliff has a good item out about the history of abortion as an issue, but what I think is worth adding is that abortion as an issue has very much been driven (I think especially on the pro-life side) by organized groups. That’s pretty normal in party politics; the same is true about guns, and to a large extent taxes, on the Republican side. I don’t think the same is true about immigration. While there are organized anti-immigration groups, I don’t see them as having the same sort of influence over the debate at all. Instead, immigration as an issue is far more driven by ordinary voter attitudes, which are then reflected back and (in the course of that process) further inflamed by opportunistic politicians.
The other part of this is that immigration is far more cross-cutting than most issues. On the Republican side, business lobbies generally support efforts (such as those supported by George W. Bush and John McCain) to ensure a ready supply of inexpensive labor — which means, in practical terms, supporting easy immigration policies of one kind or another. There are well-known interest group clashes on the Democratic side, as well. But I think what interests me most during the nomination process is that because it’s more voter-driven than group-driven, it’s a much harder issue for candidates to deal with. There’s simply no one with any authority at all to assert what the correct position on the issue is, or what bills or language you’re supposed to use to be there. And so it’s easy to see how any candidate could wind up entangled in the issue, just as Perry was recently.
I think if you add that up it means that Perry was probably right to go after Mitt Romney on immigration, and he should probably keep pushing.
On the screen, a protester from Occupy Orlando was requesting in-kind donations. “We have plenty of deodorant,” he said, “but we could use soap.” A second protester, wearing a Guy Fawkes mask, entered the frame to announce breaking news: “We’re global! Seventeen hundred viewers right now!” The crowd outside the Orlando chamber of commerce cheered.
The video feed had been picked up by globalrevolution.tv, the switchboard for live coverage of the populist protests that began with Occupy Wall Street. The channel, hosted by Livestream.com, attracts between a thousand and twenty thousand viewers at any moment. “The revolution will not be televised,” the masked protester told the crowd. “It’ll be . . . on the Internet.”
The revolution is being streamed from a dilapidated second-story office in NoHo. The A. J. Muste Institute, a pacifist organization that bought the building in 1974, is leasing the space to Global Revolution, a nascent media collective, for around four hundred dollars per month. Last Tuesday night, a pensive young man in a T-shirt that read “I AM A REVOLTING CITIZEN” was at the controls, monitoring feeds from around the country. After Orlando, he cut to a video, from earlier in the week, of Naomi Klein, the critic of corporate globalization, addressing a rally in San Francisco: “Occupation is not a place—it is a state of mind.” While the Klein clip aired, someone entered the studio with footage of Naomi Wolf, the feminist writer, who had just been arrested in an evening dress. “Naomi who?” someone said. “Isn’t she on the feed right now?”
Global Revolution brands itself as non-hierarchical, but if anyone is in charge it is Vlad Teichberg, a thirty-nine-year-old former derivatives trader. “The building’s owners should have known this would happen when they invited us, but we have sort of occupied the space,” Teichberg said last week, as he lit a cigarette with an American-flag lighter.
For the first few weeks of the protest, Global Revolution operated from under a tarp in Zuccotti Park, using wireless hot spots. Two weeks ago, the group, frustrated with the amount of equipment they were losing to theft and rain, moved to NoHo. The studio is a riot of wires taped to walls, bins of battery chargers, and laptops everywhere. A to-do list on a whiteboard includes the items “Make info/tutorial primers about live streaming” and “Troubleshoot Teradeks.” In a corner of the whiteboard, someone has written, “These are good problems to have.”
Teichberg was born in Moscow, and moved with his parents to Queens when he was ten. He attended Princeton, where he wrote a thesis on number theory, then headed to Wall Street, where he worked for Deutsche Bank. “I thought globalization was going to create equality around the world,” he said. After 9/11, his views changed. “The politicization of it—using it to start wars, and the Patriot Act and everything—it was obvious we were heading down the wrong path.” He left finance, helped found a grassroots media collective, and poured his savings into the resistance.
The way Teichberg sees it, he is helping to fuel a global revolution that started on December 17th in Tunis. In February, he went to Madrid to put cameras into the hands of protesters there. Then he came back to New York to build what he calls “camera Kalashnikovs,” in preparation for the American occupation. He sees live video as a check against police brutality. “If everyone is watching, the state can’t just crush people. That’s what kept Tahrir Square from turning into Tiananmen—they knew people were paying attention.” Global Revolution subsists on a stream of small donations. Teichberg and his cohorts buy cheap used computers on the Internet, fix them up, and send them to occupations around the country.
Teichberg lives in a squat in Bushwick with his wife, Nikki, who is expecting their first child. They were married seven weeks ago at Burning Man, with the Reverend Billy officiating. “She insists I sleep at home every night, which is causing some friction,” Teichberg said. On the second night of the Zuccotti Park occupation, the couple camped there in a tent. “I assume we conceived then, because the baby is due on June 17th,” Teichberg said. “It must have been then, because we haven’t really had time for that before or since.” Teichberg admitted that a squat is not an ideal home for a baby, but he has no long-term plan. Neither he nor his wife is working, and his savings are gone. “Maybe this video thing will take off,” he said. ♦
For weeks, Mitt Romney has been parrying attacks on his Massachusetts healthcare record while taking swipes at Rick Perry over his handling of immigration. But Romney could soon face a double-barreled dose of irony in the combination of both issues.
The Los Angeles Times reports that under Romney’s Massachusetts healthcare law, illegal immigrants can access medical care under a government program called the Health Safety Net. This program allows undocumented foreigners and other uninsured to get subsidized care simply by visiting a clinic.
Reports the Times:
Such a policy, some healthcare experts believe, can help control costs by making less expensive care available instead of forcing critically ill, uninsured patients to go to emergency rooms, where care is far more costly.
Massachusetts funds its Health Safety Net with some state money and by assessing fees on hospitals and insurers. The money is redistributed to providers who file claims for the patients who sign up for the program.
What was once an obvious vulnerability for Romney along one dimension — healthcare spending — is now likely to endanger the former governor on other issues. How voters will ultimately respond to the new details about the Massachusetts law is unclear, but given the virulence that Romney and Perry have faced on healthcare and immigration, respectively, merging the two would leave Romney with another wide-open flank.
On the campaign trail, Romney has insisted he’d be tough on illegal immigrants by building a fence on America’s border with Mexico and promising to “stop providing the incentives that promote illegal immigration.”
Of all the protesters milling about the colorful sea of tents covering the grassy lawn outside Los Angeles’ city hall, Matt Rolufs may have the toughest task. As head of the movement’s “demands and objectives committee,” it’s Rolufs’ job to figure out what the people of Occupy Los Angeles actually want. And that’s not easy, even as the movement is going on four weeks of camping outside city hall, having brought some 15,000 out to a protest last week. The signs alone indicate a wide range of issues: “Drop Tuition,” “Dump the Crony Do-Nothing Congress,” “Wall St. = Thieves” and “Save the Humans!”
But while other Occupy movements around the country have a similar lack of direction, Occupy Los Angeles has been different. The city passed a resolution voicing support for the movement. Rolufs was thrilled when city officials said that Occupy Los Angeles had inspired them to move forward on a policy initiative to demand accountability from big banks. While protesters in other cities have battled with the police, Los Angeles is letting around 700 people spend the night on city hall’slawn even though it’s against the law. Mayor Antonio Villaraigosa even handed out ponchos to campers during a rainstorm. But the city council went even further in its resolution by urging implementation of a proposal known as the Responsible Banking program because it would address some of the protesters’ concerns. “Isn’t that great?” says Rolufs, 38, a software engineer who drives 40 miles from work to Occupy Los Angeles to run the committee every day. “The people came together and raised their pitchforks in the air, and as a result we’re the impetus for change.”
First introduced more than two years ago, the proposal had lost steam until the zeal of Occupy Los Angeles gave it momentum, according to its sponsor, councilman Richard Alarcon. “We felt the resolution kind of captured the spirit of the entire movement,” Alarcon says. “We were sort of kindred spirits.” If implemented, the initiative would set up a report-card system to rate banks and deny them business if they score too low. Banks’ scores would be determined by factors such as the number of home-loan modifications they give to homeowners to prevent foreclosures, how much lending they do to small businesses and whether the institutions have committed fraudulent activity. And there is reason to suspect fraud. In 2008, the city of Los Angeles filed a lawsuit against 35 financial institutions alleging wrongdoing like rigging bidding processes to manage city debt. The suit has yet to be settled as the city waits for state and federal investigations to conclude amid similar accusations in other cities. “If we find that companies are bid rigging and defrauding the city’s taxpayers out of money with their actions, then why should we do business with them?” Alarcon says.
Still, some city officials warn cutting ties with banks may not be a good idea. In a memo sent to the mayor this week, city administrative officer Miguel Santana issued a note of caution that jettisoning some of the underwriters for the city’s bond deals could cost the city more than $50 million as it would spur higher interest rates and termination fees. That would jeopardize funding for planned public-works projects such as the replacement of a downtown bridge that has failed earthquake tests, a parking structure and reptile-and-amphibian zoo exhibits, Santana said. And it wouldn’t come at a goodtime, as the city already projects a $250 million deficit for next year amid lower tax revenue. “The issue that we’re raising here is that the policy discussion can’t be held in isolation to the more pragmatic issues of having to borrow money,” Santana said in an interview. Local blog LA Observed chimed in, calling a plan to end deals with lenders “misguided and irresponsible.” Councilman Bernard Parks, chair of the budget committee, also noted that it’s too early to accuse banks of fraud since the city’s lawsuit is still in progress. In addition, he says, the city may not have the capacity to rate and regulate the banks. “I don’t know if we have city employees that can pore through bank records to see how they’re dealing with foreclosures,” he says.
Those objections don’t hold water with the protesters, though. They’re calling for a sea change in the financial system, and they see any measure that’s tough on the banks as a good start. “I’m sure it’d be nice to go see reptiles at the zoo or a new bridge, but is that really the most important thing right now?” Richard Florence, 33, a fashion designer, said inside a tent in front of city hall. “Why don’t we hold those doing wrong accountable? Instead of being afraid we won’t get money, let’s do something bold.” With the protesters literally at its doorstep, the city’s budget committee has until next month to make a decision on the plan.
Herman Cain’s Campaign Videos are Seriously Bizarre
Yes, it’s weird. But by any objective metric, this Cain online ad from August, when he was polling at at 5 percent, is actually much, much weirder:
If you’re in DC, you won’t want to miss this Heritage Foundation extravaganza on Wednesday:
Saving the American Idea: Rejecting Fear, Envy and the Politics of Division
The American commitment to equality of opportunity, economic liberty, and upward mobility, is not tried in days of prosperity. Instead, it is tested when times are tough – when fear and envy are used to divide Americans and further the interests of politicians and their cronies. In this major address at The Heritage Foundation, Congressman Paul Ryan will dissect the real class warfare – a class of governing elites, exploiting the politics of division to pick winners and losers in our economy and determine our destinies for us. In his remarks, Congressman Ryan will outline a principled, pro-growth alternative to this path of debt, doubt and decline.
I hate the politics of envy and division, don’t you?
Nearly 11 years after the 2000 presidential election brought the idiosyncrasies of the United States’ Electoral College into full view, 62% of Americans say they would amend the U.S. Constitution to replace that system for electing presidents with a popular vote system. Barely a third, 35%, say they would keep the Electoral College.
Gallup’s initial measure of support for the Electoral College with this wording was conducted in the first few days after the 2000 presidential election in which the winner remained undeclared pending a recount in Florida. At that time, it was already clear that Democratic candidate Al Gore had won the national popular vote over Republican George W. Bush, but that the winner of the election would be the one who received Florida’s 25 Electoral College votes.
During this period, Democrats were much more likely than Republicans to favor replacing the Electoral College system with a popular vote system. In a Gallup poll conducted Dec. 15-17 — shortly after the Dec. 12 Supreme Court decision that ended the Florida recount, thereby deciding the election in Bush’s favor — 75% of Democrats said they would amend the Constitution so that the candidate who receives the most votes nationwide wins. By contrast, 56% of Republicans favored keeping the Electoral College, while 41% favored replacing it with a popular vote system.
Republicans have grown somewhat more amenable to adopting a popular vote system over the past decade. Now, for the first time since 2000, the majority of Republicans favor it. Independents are not quite as supportive as Democrats of the popular vote system, but the majority of them have consistently favored it.
With 62% of Americans today in favor of abolishing the Electoral College, Americans show relatively little attachment to this unique invention of the country’s Founding Fathers. The system was devised as a compromise between those who wanted Congress to select the president and those who favored election by the people, and it has resulted in a highly state-based approach to presidential campaigning.
Those who advocate abolishing the Electoral College often do so on the basis that the system puts undue emphasis on a small number of swing states. Whether Americans as a whole are concerned about that byproduct is unclear. However, they broadly agree that the country should adopt a system in which the popular vote prevails. While Republicans are less supportive of this than Democrats, 11 years after the 2000 election politicized the issue, the majority of Republicans once again favor the change.
AND IN OTHER NEWS…
Harvard Business Review:
It seems that no one is immune to the tendency to procrastinate. When someone asked Ernest Hemingway how to write a novel, his response was “First you defrost the refrigerator.” But putting off tasks takes a big hit on our productivity, and psyche. Procrastination is not inevitable. Figuring out why you postpone work and then taking concrete steps to prevent it will help you get more done and feel good about yourself.
What the Experts Say
According to Ned Hallowell, a psychiatrist and the author of 12 books, including Driven to Distraction, delaying work is often a symptom of how busy you are. “We procrastinate because we all have too much to do,” he says. And of course, we want to dodge things we don’t like. “Many people procrastinate because they fear the drudgery or the difficulty of the task they are avoiding,” says Teresa Amabile, the Edsel Bryant Ford Professor of Business Administration at Harvard Business School and coauthor of The Progress Principle. But, as you have likely learned, it doesn’t pay to dawdle. “Putting it off doesn’t make it go away. Getting it done does,” says Hallowell. Here are five principles to follow next time you find yourself deferring important work.
1. Figure out what’s holding you back
When you find yourself ignoring or delaying a task, ask yourself why. Hallowell points out that there are two types of tasks most often deferred:
- Something you don’t like to do. This is the most common one. As Hallowell says, “You don’t put off eating your favorite dessert.”
- Something you don’t know how to do. When you lack the necessary knowledge or are unsure of how to start a job, you are more likely to avoid it.
Once you’ve identified why you’ve put something off, you can break the cycle and prevent future bouts of procrastination.
2. Set deadlines for yourself
One of the simplest things you can do is create a schedule with clear due dates for each part of a task. “As soon as you get the project, chunk it down into a few manageable segments that you can complete in sequence,” Amabile advises. Then, assign deadlines for each piece. “Put an appointment in your calendar to work on a small piece of the next segment each day to allow yourself to get it done a bit at a time,” she says. These “small wins” make the work more manageable and contribute to your sense of progress. And achieving them is much easier than trying to barrel through a complex project.
Setting deadlines also makes sure the project doesn’t get buried. For things that you are likely to put off, add reminders in your calendar or put a Post-It on your computer screen. Use whatever visual cues will ensure you don’t avoid the project.
3. Increase the rewards
We often dally because the reward for doing a certain assignment is too far off. Regina Conti, an associate professor of psychology at Colgate University and an expert in motivation, provides the example of doing your taxes. “A person may want to complete their taxes to avoid the legal penalties of not doing so, but because those penalties are far in the future and the task is a boring one, they will not have much incentive to get started with the project,” she says. To make a task feel more immediate, focus on short-term rewards, such as getting a refund. Or if there aren’t any, insert your own. Treat yourself to a coffee break, or a quick chat with a co-worker once you’ve finished a task. You can also embed the reward into the task itself by making it more fun to do. Work with someone on a particularly difficult project or set up a game for yourself so that doing the task isn’t so boring or onerous.
4. Involve others
One of the principles Hallowell often repeats in his work is “Never worry alone.” If you don’t know how to do something, ask for help. Turn to a trusted colleague or a friend for advice. Or, look for an example of the project you are working on to use as a starting point. “Others are a great source of extrinsic motivation,” says Conti. Asking someone to review your work can spur you to get started knowing they will expect it. You can even enter an anti-procrastination pact with a co-worker: share what you are working on and hold each other accountable to set deadlines.
5. Get in the habit
“People throw up a hand and say ‘I’m such a procrastinator’ as if they have no control,” says Hallowell. “You do have control over this and you’llbe very proud when you change it.” Hallowell says that he used to be a procrastinator but trained himself to stop. “I don’t procrastinate at all now. I just do it,” he says. There are immediate benefits when you start getting things done right away, and it’s a habit you can cultivate. Amabile suggests tracking your improvement. “Spend just five minutes a day to note the progress you made, any setbacks you encountered, and what you might do the next day to enable further progress,” she says. She recommends you do this in a work diary. Then see yourself, and talk about yourself with others, as someone who gets things done. “The most powerful event, for maintaining positive inner work life, is making progress in meaningful work,” says Amabile.
Principles to Remember
- Identify which tasks you are most likely to put off
- Use deadlines to motivate you to get things done within a certain timeframe
- Reward yourself for reaching milestones
- Call yourself a procrastinator as if it is an intrinsic part of who you are
- Tackle arduous tasks on your own — ask others to help you get over the hump
- Try to finish a project in one sitting — break it down into smaller, achievable chunks
Case study #1: Know why
Lisa Freitag, a marketing consultant for an online company based in Silicon Valley, noticed she was putting off planning on a major marketing event. Every time she thought about what needed to be done, she got overwhelmed and decided to work on something else. This was odd for her: she was used to taking on big projects and blazing through them, regardless of their complexity. This project was different in that it involved several other people, including many top executives. “I procrastinate when I have to rely on other people. I prefer to just take something and run with it,” she says. For this event, she was worried about depending on others, especially busy leaders with many competing commitments.
Lisa’s anxiety wasn’t helping her and she needed to get the project going. “I wrote down a list of everything that had to happen, mapped it out on a calendar and then backed out to figure out what I needed to do first,” she says. Since many of the tasks required input from others, she wrote down what she needed from each person by when. This helped her to make clear requests to everyone involved. “I realized I was playing a very important role in keeping people on track and the executives involved appreciate that that’s what I was doing,” she says. The project still caused Lisa stress but she got through it. “I made a deal with myself. Each day, I told myself I’m going to work on it for 20 minutes now and then 20 minutes in the afternoon,” she says. Once she put a little time into it, she found it got easier with each day. Lisa also set a long-term reward for herself: when the project is complete she’s planning a team dinner.
Case study #2: Keep it top of mind
Janet Benton was an executive assistant at a medical device company when her boss assigned her an important but lower-priority project she was having trouble completing. Soon, Janet realized she too was putting it off. She couldn’t find the time to even start the project with all of the other pressing tasks on her plate. But since she had no one to delegate the project to, she decided to make progress on it in small increments. “The trick is to recognize there are steps that can be taken even if you can’t get to the final destination on the same day,” she says. She broke the project down into separate tasks that she could accomplish in 15 minutes. Using Outlook, she then scheduled time twice a day — once in the morning and then again after lunch — to take on two of the tasks. “If you give yourself an Outlook reminder and it keeps popping up you’re more likely to deal with it,” she says. Before she left each day, she wrote down the two things she was going to do the following day.
She also kept herself accountable. “The final fail-safe was to secretly vow that two days could not pass without some kind of progress,” By doing that, she was able to gain momentum on the project and it became part of her daily priorities. “That overlooked project was soon completed and turned back over to a very grateful boss. And it was off my desk, which made me happy as well,” she says.
Janet also developed other coping mechanisms to make sure projects that she might put off stay in her physical line of sight. “I always put that pesky project in an off-color folder, and put it under my to-do list at the day’s end, on top of my keyboard or computer.” That way when she comes in the next day, she has a reminder that she can’t let it go.
QUOTE OF THE DAY:
You can discover what your enemy fears most by observing the means he uses to frighten you. -Eric Hoffer |