ANS -- Occupy’s Asshole Problem: Flashbacks from An Old Hippie

This is someone else quoting a Sara Robinson article.  It's about how the Occupy Movement should deal with Assholes.  What do you think?
Find it here:  http://www.spockosbrain.com/2011/11/04/occupys-asshole-problem-flashbacks-from-an-old-hippie/  
--Kim

Occupy's Asshole Problem: Flashbacks from An Old Hippie

By spocko, on November 4th, 2011

I've been writing lately about how to deal with the vandals at the #occupy movement in my piece yesterday at Firedoglake, Time to Identify the Occupy Vandals. Today my friend Sara Robinson wrote an excellent piece on dealing with people with over-the-top behavior. I think this will be useful context for thinking about dealing with outliers.

By, Sara Robinson, Senior Fellow, Campaign for America's Future

November 4, 2011

I wish I could say that the problems that the Occupy movement is having with infiltrators and agitators are new. But they're not. In fact, they're problems that the Old Hippies who survived the 60s and 70s remember acutely, and with considerable pain.

As a veteran of those days ­ with the scars to prove it ­ watching the OWS organizers struggle with drummers, druggies, sexual harassers, racists, and anarchists brings me back to a few lessons we had to learn the hard way back in the day, always after putting up with way too much over-the-top behavior from people we didn't think we were allowed to say "no" to. It's heartening to watch the Occupiers begin to work out solutions to what I can only indelicately call "the asshole problem." In the hope of speeding that learning process along, here are a few glimmers from my own personal flashbacks ­ things that it's high time somebody said right out loud.

1. Let's be clear: It is absolutely OK to insist on behavior norms. #Occupy may be a DIY movement ­ but it also stands for very specific ideas and principles. Central among these is: We are here to reassert the common good. And we have a LOT of work to do. Being open and accepting does not mean that we're obligated to accept behavior that damages our ability to achieve our goals. It also means that we have a perfect right to insist that people sharing our spaces either act in ways that further those goals, or go somewhere else until they're able to meet that standard.

ANS -- How Ayn Rand Seduced Generations of Young Men and Helped Make the U.S. Into a Selfish, Greedy Nation

This is a short biography of Ayn Rand and analysis of how she affected the US. It's quite interesting.  It leaves out that she ended up living on welfare. 
Find it here:  http://www.greanvillepost.com/2011/12/17/how-ayn-rand-seduced-generations-of-young-men-and-helped-make-the-u-s-into-a-selfish-greedy-nation/
--Kim


Home > ANNOTATED NEWS, BASTARDS, BATTLE OF COMMUNICATIONS > How Ayn Rand Seduced Generations of Young Men and Helped Make the U.S. Into a Selfish, Greedy Nation

How Ayn Rand Seduced Generations of Young Men and Helped Make the U.S. Into a Selfish, Greedy Nation

December 17th, 2011 shorty


By Bruce E. Levine

Thanks in part to Rand, the United States is one of the most uncaring nations in the industrialized world.

Ayn Rand's "philosophy" is nearly perfect in its immorality, which makes the size of her audience all the more ominous and symptomatic as we enter a curious new phase in our society….To justify and extol human greed and egotism is to my mind not only immoral, but evil.­ Gore Vidal, 1961

Only rarely in U.S. history do writers transform us to become a more caring or less caring nation. In the 1850s, Harriet Beecher Stowe (1811-1896) was a strong force in making the United States a more humane nation, one that would abolish slavery of African Americans. A century later, Ayn Rand (1905-1982) helped make the United States into one of the most uncaring nations in the industrialized world, a neo-Dickensian society where healthcare is only for those who can afford it, and where young people are coerced into huge student-loan debt that cannot be discharged in bankruptcy.

Rand's impact has been widespread and deep. At the iceberg's visible tip is the influence she's had over major political figures who have shaped American society. In the 1950s, Ayn Rand read aloud drafts of what was later to become Atlas Shrugged to her "Collective," Rand's ironic nickname for her inner circle of young individualists, which included Alan Greenspan, who would serve as chairman of the Federal Reserve Board from 1987 to 2006.

In 1966, Ronald Reagan wrote in a personal letter, "Am an admirer of Ayn Rand." Today, Rep. Paul Ryan (R-WI) credits Rand for inspiring him to go into politics, and Sen. Ron Johnson (R-WI) calls Atlas Shrugged his "foundation book." Rep. Ron Paul (R-TX) says Ayn Rand had a major influence on him, and his son Sen. Rand Paul (R-KY) is an even bigger fan. A short list of other Rand fans includes Supreme Court Justice Clarence Thomas; Christopher Cox, chairman of the Security and Exchange Commission in George W. Bush's second administration; and former South Carolina governor Mark Sanford.

But Rand's impact on U.S. society and culture goes even deeper.

The Seduction of Nathan Blumenthal

Ayn Rand's books such as The Virtue of Selfishness and her philosophy that celebrates self-interest and disdains altruism may well be, as Vidal assessed, "nearly perfect in its immorality." But is Vidal right about evil? Charles Manson, who himself did not kill anyone, is the personification of evil for many of us because of his psychological success at exploiting the vulnerabilities of young people and seducing them to murder. What should we call Ayn Rand's psychological ability to exploit the vulnerabilities of millions of young people so as to influence them not to care about anyone besides themselves?

While Greenspan (tagged "A.G." by Rand) was the most famous name that would emerge from Rand's Collective, the second most well-known name to emerge from the Collective was Nathaniel Branden, psychotherapist, author and "self-esteem" advocate. Before he was Nathaniel Branden, he was Nathan Blumenthal, a 14-year-old who read Rand's The Fountainhead again and again. He later would say, "I felt hypnotized." He describes how Rand gave him a sense that he could be powerful, that he could be a hero. He wrote one letter to his idol Rand, then a second. To his amazement, she telephoned him, and at age 20, Nathan received an invitation to Ayn Rand's home. Shortly after, Nathan Blumenthal announced to the world that he was incorporating Rand in his new name: Nathaniel Branden. And in 1955, with Rand approaching her 50th birthday and Branden his 25th, and both in dissatisfying marriages, Ayn bedded Nathaniel.

What followed sounds straight out of Hollywood, but Rand was straight out of Hollywood, having worked for Cecil B. DeMille. Rand convened a meeting with Nathaniel, his wife Barbara (also a Collective member), and Rand's own husband Frank. To Branden's astonishment, Rand convinced both spouses that a time-structured affair­she and Branden were to have one afternoon and one evening a week together­was "reasonable." Within the Collective, Rand is purported to have never lost an argument. On his trysts at Rand's New York City apartment, Branden would sometimes shake hands with Frank before he exited. Later, all discovered that Rand's sweet but passive husband would leave for a bar, where he began his self-destructive affair with alcohol.

By 1964, the 34-year-old Nathaniel Branden had grown tired of the now 59-year-old Ayn Rand. Still sexually dissatisfied in his marriage to Barbara and afraid to end his affair with Rand, Branden began sleeping with a married 24-year-old model, Patrecia Scott. Rand, now "the woman scorned," called Branden to appear before the Collective, whose nickname had by now lost its irony for both Barbara and Branden. Rand's justice was swift. She humiliated Branden and then put a curse on him: "If you have one ounce of morality left in you, an ounce of psychological health­you'll be impotent for the next twenty years! And if you achieve potency sooner, you'll know it's a sign of still worse moral degradation!"

Rand completed the evening with two welt-producing slaps across Branden's face. Finally, in a move that Stalin and Hitler would have admired, Rand also expelled poor Barbara from the Collective, declaring her treasonous because Barbara, preoccupied by her own extramarital affair, had neglected to fill Rand in soon enough on Branden's extra-extra-marital betrayal. (If anyone doubts Alan Greenspan's political savvy, keep in mind that he somehow stayed in Rand's good graces even though he, fixed up by Branden with Patrecia's twin sister, had double-dated with the outlaws.)

After being banished by Rand, Nathaniel Branden was worried that he might be assassinated by other members of the Collective, so he moved from New York to Los Angeles, where Rand fans were less fanatical. Branden established a lucrative psychotherapy practice and authored approximately 20 books, 10 of them with either "Self" or "Self-Esteem" in the title. Rand and Branden never reconciled, but he remains an admirer of her philosophy of self-interest.

Ayn Rand's personal life was consistent with her philosophy of not giving a shit about anybody but herself. Rand was an ardent two-pack-a-day smoker, and when questioned about the dangers of smoking, she loved to light up with a defiant flourish and then scold her young questioners on the "unscientific and irrational nature of the statistical evidence." After an x-ray showed that she had lung cancer, Rand quit smoking and had surgery for her cancer. Collective members explained to her that many people still smoked because they respected her and her assessment of the evidence; and that since she no longer smoked, she ought to tell them. They told her that she needn't mention her lung cancer, that she could simply say she had reconsidered the evidence. Rand refused.

How Rand's Philosophy Seduced Young Minds

When I was a kid, my reading included comic books and Rand's The Fountainhead and Atlas Shrugged. There wasn't much difference between the comic books and Rand's novels in terms of the simplicity of the heroes. What was different was that unlike Superman or Batman, Rand made selfishness heroic, and she made caring about others weakness.

Rand said, "Capitalism and altruism are incompatible….The choice is clear-cut: either a new morality of rational self-interest, with its consequences of freedom, justice, progress and man's happiness on earth­or the primordial morality of altruism, with its consequences of slavery, brute force, stagnant terror and sacrificial furnaces." For many young people, hearing that it is "moral" to care only about oneself can be intoxicating, and some get addicted to this idea for life.

I have known several people, professionally and socially, whose lives have been changed by those close to them who became infatuated with Ayn Rand. A common theme is something like this: "My ex-husband wasn't a bad guy until he started reading Ayn Rand. Then he became a completely selfish jerk who destroyed our family, and our children no longer even talk to him."

To wow her young admirers, Rand would often tell a story of how a smart-aleck book salesman had once challenged her to explain her philosophy while standing on one leg. She replied: "Metaphysics­objective reality. Epistemology­reason. Ethics­self-interest. Politics­capitalism." How did that philosophy capture young minds?

Metaphysics­objective reality. Rand offered a narcotic for confused young people: complete certainty and a relief from their anxiety. Rand believed that an "objective reality" existed, and she knew exactly what that objective reality was. It included skyscrapers, industries, railroads, and ideas­at least her ideas. Rand's objective reality did not include anxiety or sadness. Nor did it include much humor, at least the kind where one pokes fun at oneself. Rand assured her Collective that objective reality did not include Beethoven's, Rembrandt's, and Shakespeare's realities­they were too gloomy and too tragic, basically buzzkillers. Rand preferred Mickey Spillane and, towards the end of her life, "Charlie's Angels."

Epistemology­reason. Rand's kind of reason was a "cool-tool" to control the universe. Rand demonized Plato, and her youthful Collective members were taught to despise him. If Rand really believed that the Socratic Method described by Plato of discovering accurate definitions and clear thinking did not qualify as "reason," why then did she regularly attempt it with her Collective? Also oddly, while Rand mocked dark moods and despair, her "reasoning" directed that Collective members should admire Dostoyevsky, whose novels are filled with dark moods and despair. A demagogue, in addition to hypnotic glibness, must also be intellectually inconsistent, sometimes boldly so. This eliminates challenges to authority by weeding out clear-thinking young people from the flock.

Ethics­self-interest. For Rand, all altruists were manipulators. What could be more seductive to kids who discerned the motives of martyr parents, Christian missionaries and U.S. foreign aiders? Her champions, Nathaniel Branden still among them, feel that Rand's view of "self-interest" has been horribly misrepresented. For them, self-interest is her hero architect Howard Roark turning down a commission because he couldn't do it exactly his way. Some of Rand's novel heroes did have integrity, however, for Rand there is no struggle to discover the distinction between true integrity and childish vanity. Rand's integrity was her vanity, and it consisted of getting as much money and control as possible, copulating with whomever she wanted regardless of who would get hurt, and her always being right. To equate one's selfishness, vanity, and egotism with one's integrity liberates young people from the struggle to distinguish integrity from selfishness, vanity, and egotism.

Politics­capitalism. While Rand often disparaged Soviet totalitarian collectivism, she had little to say about corporate totalitarian collectivism, as she conveniently neglected the reality that giant U.S. corporations, like the Soviet Union, do not exactly celebrate individualism, freedom, or courage. Rand was clever and hypocritical enough to know that you don't get rich in the United States talking about compliance and conformity within corporate America. Rather, Rand gave lectures titled: "America's Persecuted Minority: Big Business." So, young careerist corporatists could embrace Rand's self-styled "radical capitalism" and feel radical ­ radical without risk.

Rand's Legacy

In recent years, we have entered a phase where it is apparently okay for major political figures to publicly embrace Rand despite her contempt for Christianity. In contrast, during Ayn Rand's life, her philosophy that celebrated self-interest was a private pleasure for the 1 percent but she was a public embarrassment for them. They used her books to congratulate themselves on the morality of their selfishness, but they publicly steered clear of Rand because of her views on religion and God. Rand, for example, had stated on national television, "I am against God. I don't approve of religion. It is a sign of a psychological weakness. I regard it as an evil."

Actually, again inconsistent, Rand did have a God. It was herself. She said:

I am done with the monster of "we," the word of serfdom, of plunder, of misery, falsehood and shame. And now I see the face of god, and I raise this god over the earth, this god whom men have sought since men came into being, this god who will grant them joy and peace and pride. This god, this one word: "I."

While Harriet Beecher Stowe shamed Americans about the United State's dehumanization of African Americans and slavery, Ayn Rand removed Americans' guilt for being selfish and uncaring about anyone except themselves. Not only did Rand make it "moral" for the wealthy not to pay their fair share of taxes, she "liberated" millions of other Americans from caring about the suffering of others, even the suffering of their own children.

The good news is that I've seen ex-Rand fans grasp the damage that Rand's philosophy has done to their lives and to then exorcize it from their psyche. Can the United States as a nation do the same thing?

>Bruce E. Levine is a clinical psychologist and author of Get Up, Stand Up: Uniting Populists, Energizing the Defeated, and Battling the Corporate Elite (Chelsea Green, 2011). His Web site is www.brucelevine.net.

ANS -- Crippling the Right to Organize

More Republican destruction by obstruction.  More Americans need to know about all the ways the Republicans are blocking things in government.
this one is about the Labor Relations board. 
find it here:  http://www.nytimes.com/2011/12/17/opinion/crippling-the-right-to-organize.html?_r=1&src=tp
--Kim


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Op-Ed Contributor

Crippling the Right to Organize

By WILLIAM B. GOULD IV


Published: December 16, 2011

Stanford, Calif.
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UNLESS something changes in Washington, American workers will, on New Year's Day, effectively lose their right to be represented by a union. Two of the five seats on the National Labor Relations Board, which protects collective bargaining, are vacant, and on Dec. 31, the term of Craig Becker, a labor lawyer whom President Obama named to the board last year through a recess appointment, will expire. Without a quorum, the Supreme Court ruled last year, the board cannot decide cases.

What would this mean?

Workers illegally fired for union organizing won't be reinstated with back pay. Employers will be able to get away with interfering with union elections. Perhaps most important, employers won't have to recognize unions despite a majority vote by workers. Without the board to enforce labor law, most companies will not voluntarily deal with unions.

If this nightmare comes to pass, it will represent the culmination of three decades of Republican resistance to the board ­ an unwillingness to recognize the fundamental right of workers to band together, if they wish, to seek better pay and working conditions. But Mr. Obama is also partly to blame; in trying to install partisan stalwarts on the board, as his predecessors did, he is all but guaranteeing that the impasse will continue. On Wednesday, he announced his intention to nominate two pro-union lawyers to the board, though there is no realistic chance that either can gain Senate confirmation anytime soon.

For decades after its creation in 1935, the board was a relatively fair arbiter between labor and capital. It has protected workers' right to organize by, among other things, overseeing elections that decide on union representation. Employers may not engage in unfair labor practices, like intimidating organizers and discriminating against union members. Unions are prohibited, too, from doing things like improperly pressuring workers to join.

The system began to run into trouble in the 1970s. Employers found loopholes that enabled them to delay the board's administrative proceedings, sometimes for years. Reforms intended to speed up the board's resolution of disputes have repeatedly foundered in Congress.

The precipitous decline of organized labor ­ principally a result of economic forces, not legal ones ­ cemented unions' dependence on the board, despite its imperfections. Meanwhile, business interests, represented by an increasingly conservative Republican Party, became more assertive in fighting unions.

The board became dysfunctional. Traditionally, members were career civil servants or distinguished lawyers and academics from across the country. But starting in the Reagan era, the board's composition began to tilt toward Washington insiders like former Congressional staff members and former lobbyists.

Starting with a compromise that allowed my confirmation in 1994, the board's members and general counsel have been nominated in groups. In contrast to the old system, the new "batching" meant that nominees were named as a package acceptable to both parties. As a result, the board came to be filled with rigid ideologues. Some didn't even have a background in labor law.

Under President George W. Bush, the board all but stopped using its discretion to obtain court orders against employers before the board's own, convoluted, administrative process was completed ­ a power that, used fairly, is a crucial protection for workers. In 2007, in what has been called the September Massacre, the board issued rulings that made it easier for employers to block union organizing and harder for illegally fired employees to collect back pay. Democratic senators then blocked Mr. Bush from making recess appointments to the board, as President Bill Clinton had done. For 27 months, until March 2010, the board operated with only two members; in June 2010, the Supreme Court ruled that it needed at least three to issue decisions.

Under Mr. Obama, the board has begun to take enforcement more seriously, by pursuing the court orders that the board under Mr. Bush had abandoned. Sadly, though, the board has also been plagued by unnecessary controversy. In April, the acting general counsel issued a complaint over Boeing's decision to build airplanes at a nonunion plant in South Carolina, following a dispute with Boeing machinists in Washington State. Although the complaint was dropped last week after the machinists reached a new contract agreement with Boeing, the controversy reignited Republican threats to cut financing for the board.

In my view, the complaint against Boeing was legally flawed, but the threats to cut the board's budget represent unacceptable political interference. The shenanigans continue: last month, before the board tentatively approved new proposals that would expedite unionization elections, the sole Republican member threatened to resign, which would have again deprived the board of a quorum.

Mr. Obama needs to make this an election-year issue; if the board goes dark in January, he should draw attention to Congressional obstructionism during the campaign and defend the board's role in protecting employees and employers. A new vision for labor-management cooperation must include not only a more powerful board, but also a less partisan one, with members who are independent and neutral experts. Otherwise, the partisan morass will continue, and American workers will suffer.

William B. Gould IV, a law professor at Stanford, was chairman of the National Labor Relations Board from 1994 to 1998.

ANS -- The Defense Bill Passed. So What Does It Do?

No, this bill does not do what most news people are saying it does.  However, it's still not a good idea. 
I think the article is correct because it was linked by Norman Goldman (radio talker) who is a lawyer (and a Progressive).
Find it here:  http://motherjones.com/mojo/2011/12/defense-bill-passed-so-what-does-it-do-ndaa  
--Kim

MoJo

Previous | Next
Civil Liberties, Congress, Courts, Crime and Justice, Military, Must Reads, Politics

The Defense Bill Passed. So What Does It Do?

­By Adam Serwer
| Fri Dec. 16, 2011 2:34 PM PST

66

 Paul Keller/Flickr

Following the Obama administration's withdrawal of its veto threat Wednesday, the National Defense Authorization Act passed both houses of Congress easily and is now headed to the president's desk.

So what exactly does the bill do? It says that the president has to hold a foreign Al Qaeda suspect captured on US soil in military detention­except it leaves enough procedural loopholes that someone like convicted underwear bomber and Nigerian citizen Umar Abdulmutallab could actually go from capture to trial without ever being held by the military. It does not, contrary to what many media outlets have reported, authorize the president to indefinitely detain without trial an American citizen suspected of terrorism who is captured in the US. A last minute compromise amendment adopted in the Senate, whose language was retained in the final bill, leaves it up to the courts to decide if the president has that power, should a future president try to exercise it. But if a future president does try to assert the authority to detain an American citizen without charge or trial, it won't be based on the authority in this bill.

So it's simply not true, as the Guardian wrote yesterday, that the the bill "allows the military to indefinitely detain without trial American terrorism suspects arrested on US soil who could then be shipped to Guantánamo Bay." When the New York Times editorial page writes that the bill would "strip the F.B.I., federal prosecutors and federal courts of all or most of their power to arrest and prosecute terrorists and hand it off to the military," or that the "legislation could also give future presidents the authority to throw American citizens into prison for life without charges or a trial," they're simply wrong.

The language in the bill that relates to the detention authority as far as US citizens and permanent residents are concerned is, "Nothing in this section shall be construed to affect existing law or authorities relating to the detention of United States citizens, lawful resident aliens of the United States, or any other persons who are captured or arrested in the United States."

As I've written before, this is cop-out language. It allows people who think the 2001 Authorization to Use Military Force against the perpetrators of the 9/11 attacks gives the president the authority to detain US citizens without charge or trial to say that, but it also allows people who can read the Constitution of the United States to argue something else. That's why Sen. Dianne Feinstein (D-Calif.) has proposed legislation to make it clear that indefinite detention authority does not apply to US citizens arrested in the US­which at the very least, should force Congress to go on record about who exactly is opposed to detention without trial at the whim of the executive branch.

Does the defense bill change the status quo? Yes. Though detention of non-citizen Al Qaeda suspects captured in the US is now mandatory in name only, because of procedural loopholes that allow the president to avoid placing such a suspect in military custody, the bill nevertheless writes into law an assumed role for the military in domestic counterterrorism that did not exist before. This is not a power this president is likely to use, because neither he nor his top national security officials seem to think they even need it. A future US president, even one more enamored of executive power, might still not use it for similar reasons: Because his non-political advisers tell him it's a bad idea.

Still, the reason supporters like Senator Lindsey Graham (R-S.C.) are happy with this bill is that it codifies into law a role for the military where there was none before. It is the first concrete gesture Congress has made towards turning the homeland into the battlefield, even if the impact in the near term is more symbolic and political than concrete.

But "symbolic" and "political" doesn't mean "meaningless." Codifying indefinite detention on American soil is a very dangerous step, and politicians who believe the military should have an even larger domestic counterterrorism role simply aren't going to be satisfied with this. In fact, if there is another attack, it's all but certain they will hammer the president should he choose not to place the suspect in military detention.

There really is no telling where inertia brings us from here. Graham and his colleagues have made no secret of the fact that they believe the president should (and does) have the ability to detain American terrorism suspects captured in the US indefinitely, and they may even have enough votes in Congress to make it happen some day. At that point, the only defense for Americans will be the Constitution and a Supreme Court willing to read what it says.

UPDATE: In case it's not clear, I still think the president should veto the bill. What it does is bad enough. It just doesn't do what a lot of people are saying it does.

ANS -- Anonymous donors pay off Kmart layaway accounts

I just thought this was sweet.  Some holiday cheer. 
Find it here: http://finance.yahoo.com/news/anonymous-donors-pay-off-kmart-222535611.html  
--Kim

Anonymous donors pay off Kmart layaway accounts

At Kmart stores, Santa gets help: Anonymous donors are paying off strangers' layaway accounts

By Margery a. Beck, Associated Press | AP – Fri, Dec 16, 2011 11:33 AM EST

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• Kmart store manager Ted Straub talks Thursday Dec 15, 2011 in his Omaha, Neb store. Dozens of Kmart customers across the country have had their layaways paid off by strangers. (AP Photo/Dave Weaver)

OMAHA, Neb. (AP) -- The young father stood in line at the Kmart layaway counter, wearing dirty clothes and worn-out boots. With him were three small children.

He asked to pay something on his bill because he knew he wouldn't be able to afford it all before Christmas. Then a mysterious woman stepped up to the counter.

"She told him, 'No, I'm paying for it,'" recalled Edna Deppe, assistant manager at the store in Indianapolis. "He just stood there and looked at her and then looked at me and asked if it was a joke. I told him it wasn't, and that she was going to pay for him. And he just busted out in tears."

At Kmart stores across the country, Santa seems to be getting some help: Anonymous donors are paying off strangers' layaway accounts, buying the Christmas gifts other families couldn't afford, especially toys and children's clothes set aside by impoverished parents.

Before she left the store Tuesday evening, the Indianapolis woman in her mid-40s had paid the layaway orders for as many as 50 people. On the way out, she handed out $50 bills and paid for two carts of toys for a woman in line at the cash register.

"She was doing it in the memory of her husband who had just died, and she said she wasn't going to be able to spend it and wanted to make people happy with it," Deppe said. The woman did not identify herself and only asked people to "remember Ben," an apparent reference to her husband.

Deppe, who said she's worked in retail for 40 years, had never seen anything like it.

"It was like an angel fell out of the sky and appeared in our store," she said.

[See also: 5 Super Stocking Stuffers for Under $10]

Most of the donors have done their giving secretly.

Dona Bremser, an Omaha nurse, was at work when a Kmart employee called to tell her that someone had paid off the $70 balance of her layaway account, which held nearly $200 in toys for her 4-year-old son.

"I was speechless," Bremser said. "It made me believe in Christmas again."

Dozens of other customers have received similar calls in Nebraska, Michigan, Iowa, Indiana and Montana.

The benefactors generally ask to help families who are squirreling away items for young children. They often pay a portion of the balance, usually all but a few dollars or cents so the layaway order stays in the store's system.

The phenomenon seems to have begun in Michigan before spreading, Kmart executives said.

"It is honestly being driven by people wanting to do a good deed at this time of the year," said Salima Yala, Kmart's division vice president for layaway.

The good Samaritans seem to be visiting mainly Kmart stores, though a Wal-Mart spokesman said a few of his stores in Joplin, Mo., and Chicago have also seen some layaway accounts paid off.

Kmart representatives say they did nothing to instigate the secret Santas or spread word of the generosity. But it's happening as the company struggles to compete with chains such as Wal-Mart and Target.

Kmart may be the focus of layaway generosity, Yala said, because it is one of the few large discount stores that has offered layaway year-round for about four decades. Under the program, customers can make purchases but let the store hold onto their merchandise as they pay it off slowly over several weeks.

The sad memories of layaways lost prompted at least one good Samaritan to pay off the accounts of five people at an Omaha Kmart, said Karl Graff, the store's assistant manager.

"She told me that when she was younger, her mom used to set up things on layaway at Kmart, but they rarely were able to pay them off because they just didn't have the money for it," Graff said.

He called a woman who had been helped, "and she broke down in tears on the phone with me. She wasn't sure she was going to be able to pay off their layaway and was afraid their kids weren't going to have anything for Christmas."

"You know, 50 bucks may not sound like a lot, but I tell you what, at the right time, it may as well be a million dollars for some people," Graff said.

Graff's store alone has seen about a dozen layaway accounts paid off in the last 10 days, with the donors paying $50 to $250 on each account.

"To be honest, in retail, it's easy to get cynical about the holidays, because you're kind of grinding it out when everybody else is having family time," Graff said. "It's really encouraging to see this side of Christmas again."

[See also: White House Christmas Trees: Then and Now]

Lori Stearnes of Omaha also benefited from the generosity of a stranger who paid all but $58 of her $250 layaway bill for toys for her four youngest grandchildren.

Stearnes said she and her husband live paycheck to paycheck, but she plans to use the money she was saving for the toys to help pay for someone else's layaway.

In Missoula, Mont., a man spent more than $1,200 to pay down the balances of six customers whose layaway orders were about to be returned to a Kmart store's inventory because of late payments.

Store employees reached one beneficiary on her cellphone at Seattle Children's Hospital, where her son was being treated for an undisclosed illness.

"She was yelling at the nurses, 'We're going to have Christmas after all!'" store manager Josine Murrin said.

A Kmart in Plainfield Township, Mich., called Roberta Carter last week to let her know a man had paid all but 40 cents of her $60 layaway.

Carter, a mother of eight from Grand Rapids, Mich., said she cried upon hearing the news. She and her family have been struggling as she seeks a full-time job.

"My kids will have clothes for Christmas," she said.

Angie Torres, a stay-at-home mother of four children under the age of 8, was in the Indianapolis Kmart on Tuesday to make a payment on her layaway bill when she learned the woman next to her was paying off her account.

"I started to cry. I couldn't believe it," said Torres, who doubted she would have been able to pay off the balance. "I was in disbelief. I hugged her and gave her a kiss."

ANS -- Forgive Us Our Debts

I need to read this one again.  It's Doug Muder again, and he makes things very clear, but this is a different viewpoint than one usually sees on economics -- as he says, it's a bird's eye view, and then a very high bird's eye view.  It questions whether, if loaned a foolish loan, it is really the debtor who is to blame. 
Find it here:  http://weeklysift.com/2011/12/05/forgive-us-our-debts/#comment-1467  
--Kim

Forgive Us Our Debts

It's striking how many of the big stories in the news revolve around debt:

• the European debt crisis, with its Greek, Italian, Irish, Spanish, and Icelandic subplots;
• the failure of the so-called "Super Committee" to reach an agreement, which is just the latest episode in the long-running saga of the U.S. federal budget deficit;
• the continuing not-technically-a-recession, with its roots in the debt-fueled housing bubble;
• the increasing separation of American society into a creditor class and a debtor class;
• popular anger ­ expressed in both Occupy Wall Street and the Tea Party ­ about the misdeeds of the too-big-to-fail banks and their special relationship with the government;
• new revelations about the role of the Federal Reserve in creating profits for the big banks, and the role of the SEC in helping them cover up their crimes. (See this week's Short Notes.

Each one of these stories has its own nuances. Plunging into the details, understanding why none of them is exactly what it appears to be, can be strangely comforting. It feeds the illusion that if we can get to the bottom of one of these stories, eventually we can get to the bottom of all of them.

But we also need to get to the top of the story. At some point we need to get a bird's eye view so that we can see how all those trees make a forest: What is up with debt, anyway? Why do all our problems, no matter how disconnected they seem initially, seem to revolve around it?

Several authors have tried to provide the birds-eye view, painting a unified if somewhat disturbing picture: This isn't just about economics. It's about democracy.

Haslett. One recent aerial reconnaissance was Adam Haslett's Salon article This is Our New Normal. Haslett says we can't get into a normal recovery because we aren't in a normal recession. Instead,

In many countries, the fundamental political and economic bargain of postwar society is in the process of coming apart.

The West's rapid economic recovery from World War II made that bargain work for about a quarter century. Wages could rise without hurting profits or causing unemployment. The poor could be lifted up and middle class could achieve a new level of prosperity without dragging down the rich.

But growth slowed down in the 1970s, and Haslett retells economic history since then as a series of lesser problems caused by our evasion of the larger problem: What should a slow-growth social contract look like? Basically, inflation and debt are two ways to hide lackluster growth. So we had inflation in the 70s, government budget deficits in the 80s, and multiple cycles of private-investment-bubble/debt-crisis from the 1990s on.

Such growth as we have seen in the last four decades is increasingly based on finance rather than manufacturing, and concentrated on the already rich. These opportunities are not only out of most people's reach, but beyond their understanding.

Most people can understand what political forces are at play when a union demands higher wages and a company resists, citing foreign competition. … But what happens when a politician says we must lend billions of dollars to undercapitalized banks or indebted countries in order to provide liquidity to the financial system, and if we don't we will enter a depression or blow up the euro? The content, let alone the truth, of such a proposition is hard for most people to assess.

The result is an across-the-board loss of faith in democracy: Big-money interests are unwilling to leave their fate in the hands of the ignorant masses, while the average citizen wants to believe that somebody somewhere understands this stuff and can manage it properly. And so

the key decisions are made without democratic consultation by financial bureaucrats working with private bankers. … Financial policy becomes more like foreign policy, conducted by an executive strong-arming a parliament or legislature under conditions of emergency.

But without democratic process, public debts start to lose their legitimacy. Why shouldn't the People simply repudiate debts that have been thrust upon them by technocrats? And if they do, will creditors absorb the loss? Mount a coup? What? Haslett has no answer, but believes that even framing that question advances the needed discussion.

Hudson. An even-higher-altitude view comes from economist Michael Hudson's article Debt Slavery in the current issue of Counterpunch. Hudson observes that ancient societies regularly ran into trouble when creditors gained too much power.

The general pattern went like this: During droughts and other natural disasters, small landholders would need more help that they could pay for and so would be forced to borrow on the lender's terms. (As Adlai Stevenson put it, "A hungry man is not free.") Eventually the lenders would end up owning the land, turning the original owners into serfs, slaves, or criminals.

Since small landowners were the core of effective ancient armies, this gradual reduction to slavery was a disaster from a king's point-of-view. So mass cancellation of debts was a frequent feature of ancient imperial governance, and got instituted in the Torah as the Jubilee Year.

If creditors became too powerful for the king to cancel debts, the empire usually fell. That is Hudson's explanation for the fall of Rome, which lost its ability to raise an army of native landowners and had to rely instead on foreign mercenaries, who eventually over-ran the empire.

"Creditor power and stable growth rarely have gone together," Hudson writes.

The rise of democracy in the 1600s meant that debts could be owed by the People as a whole, rather than by individuals or kings who might be overthrown. However, eventually the ancient problem re-appears:

The tendency for debts to grow faster than the population's ability to pay has been a basic constant throughout all recorded history. Debts mount up exponentially, absorbing the surplus and reducing much of the population to the equivalent of debt peonage.

Modern democracies don't have jubilee years, but they achieve the same purpose by progressive taxation financing a social safety net, plus government control of central banks and regulation of banking in general. In recent years, though, the creditor class has gained enough political power that it can lower its own tax rates, cut the safety net, and deregulate. Hence the current global crisis.

When banks are permitted to be self-regulating and given veto power over government regulators, the economy is distorted to permit creditors to indulge in the speculative gambles and outright fraud that have marked the past decade.

The result is the kind of tension Haslett noted: Creditors want economic decisions taken away from elected officials and turned over to technocrats. But the bankers have lost sight of the big picture: Technocratic management causes the People to lose commitment to "their" public debt, which they will eventually repudiate, as has already happened in Argentina and Iceland.

Graeber. According to an old saying, you can't tell a fish that it swims in water. That's a good way to think of anthropologists: They're fish who study the water the rest of us take for granted. David Graeber's recent book Debt: The First 5,000 Years is an anthropologist's take on economics. And so, mixing my animal metaphors, it is the highest-flying bird of all.

Graeber is writing this book to answer the question: Why do people have to pay their debts? It's an almost universal moral principle, but its applications are perverse. He notes what he saw while studying the highland peoples of Madagascar: IMF-imposed austerity killed the mosquito eradication program. Predictably, malaria returned, killing thousands of poor children.

Now, few people would knowingly make the moral choice "Children should die so that Madagascar can give money to Citibank", especially since the country's indebtedness is all bound up in its colonial history. But once expressed as debt, the logic somehow seems obvious.

There is no better way to justify relations founded on violence, to make such relations seem moral, than by reframing them in the language of debt ­ above all, because it makes it seem that it's the victim who's doing something wrong.

Banks can and have, for example, lent irrational sums of money to countries whose corrupt dictators stole it. Should the People have to repay those loans? The logic of this isn't even good capitalism. Graeber imagines asking the Royal Bank of Scotland for a million-pound loan to bet on a horserace. Good bankers would wisely turn him down.

But, imagine there was some law that said they were guaranteed to get their money back no matter what happens, even if that meant, I don't know, selling my daughter into slavery or harvesting my organs or something. Well, in that case, why not? Why bother waiting for someone to walk in who has a viable plan to set up a laundromat or some such?

Good capitalism, in other words, depends on foolish loans not being repaid.

Moral framing. The rest of the book is a long historical/anthropological meditation on how repaying debts came to seem like the bedrock of morality. The answer is surprisingly deep and bizarre: Our language for framing moral questions has come to be based on the metaphor of debt. Moral obligations of all sorts are expressed as what we "owe". It's baked into the language: ought and owe come from the same root; should comes from the German schuld, meaning debt.

Even God is pictured as maintaining a ledger of our good and bad deeds, which will be read at a Day of Reckoning ­ a term that comes from accounting. Afterward, some will be dragged away to an eternal debtors prison, while others will see their slates wiped clean in a massive Jubilee.

As George Lakoff teaches, "common sense" is nothing more than what is implied by the unexamined assumptions contained in our framing metaphors. Consequently, "people have to pay their debts" is common sense, even though it's actually fairly dubious.

The net effect of Graeber's book is to de-mystify debt, and to strip it of its undeserved moral trappings. If you're killing children to enrich bankers, the morality of that has to stand on its own.

The hidden history of money. Graeber can't cover debt without re-examining money, whose history has largely been hidden behind myths.

Econ 101 teaches that primitive barter economies developed money to make trade more efficient. In fact, anthropologists know that there has never been a primitive barter economy. Economies based on trade develop after money, not before. (Pre-monetary economies are like families or mafias ­ based on relationships of mutual obligation, not trade of goods and services.) Economists hide the history of money out of shame, because it is all bound up with slavery. It's only a slight exaggeration to say that money developed in order to buy people.

A personal relationship is a long series of inexact exchanges of favors. Money introduces the idea that indebtedness can be precisely quantified and that the account can be settled, allowing both parties to walk away from the relationship clean. (That, Graeber explains, is why we instinctively rebel at mixing money and friendship. Settling accounts is preparation for ending the relationship.)

The true history of money shows why it has destabilized the moral structure of one traditional society after another. Money distances people from each other, and reduces everything to the status of a commodity. And so we are distanced from the consequences of our demands: I don't want parents to starve their children or old people to go without health care ­ I just want a good return on my money.

Summing up. Debt and its repayment is not some technical issue to be worked out by economic experts. Ultimately, a country's debt is only meaningful in two situations: If the People are committed to repaying it, or if the country has an undemocratic government strong enough to force repayment against the People's will. "Technocratic" solutions start us down the second path.

And finally, what a country does with its resources is a moral choice. The morality of that choice can be hidden by the language of debt, but not forever. The sooner we see through our illusions about debt, the better.

ANS -- Alabama Can't Find Anyone to Fill Undocumented Immigrants' Old Jobs

this is what happens when you chase out all the undocumented immigrants.
Find it here:  http://www.examiner.com/immigration-reform-in-springfield-ma/alabama-can-t-find-anyone-to-fill-undocumented-immigrants-old-jobs   
--Kim

Alabama Can't Find Anyone to Fill Undocumented Immigrants' Old Jobs

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Edward Deragon

, Springfield Immigration Reform Examiner
December 6, 2011 -


Alabama agriculture officials are stumped over how to keep farms operating now that the state's draconian new immigration law chased away all of the low paid (however illegal) labor. The latest idea: Hire prisoners. The Associate Press reports:

The nursery and landscape industry will need as many as 4,000 workers in southern counties early in 2012 to get ready for the growing season, he said, and forestry and farming will require still more laborers. Unable to find legal residents to fill all the employment gaps, [Deputy commissioner with the Alabama Department of Agriculture and Industries Brett] Hall said the Agriculture Department is consulting with the Department of Corrections to determine whether prisoners could do some of the work.

But we thought America was experiencing an economic downturn, leaving many Americans out of work. A quick Google search reveals that Alabama is actually worse off than the rest of the country, with a 9.3 percent rate of unemployment. What's wrong with helping out on a farm? Is the pay crappy? That's actually not it:

Farmers have complained of a lack of field hands since parts of the law took effect in late September. Many have said legal residents aren't physically able or mentally tough enough to perform the work, and others won't do so because it doesn't pay enough.

Hall said the agriculture positions pay well above minimum wage, but many Americans find them too "physically taxing" to perform.

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ANS -- INTERPRETING THE "AUSTERITY" FOLLY

Here is a very interesting idea, not quite fully developed, by Andy Schmookler, whom many of you will recognize from previous posts, and who is running for congress in his state (I believe it's Virginia, if I remember right.)  It is about the economy and the impulse to sacrifice, especially to sacrifice someone else, and how this impulse to sacrifice seems dominant even when it is provably counter-productive.  It's short.
Find it here:  http://www.facebook.com/photo.php?fbid=303813666305986&set=a.230022150351805.58794.229965547024132&type=1
--Kim


Andy Schmookler for Congress

INTERPRETING THE "AUSTERITY" FOLLY

In the following, I'm building on a well-developed foundation built, stone by stone, by Paul Krugman. In the following, I'm also disregarding what political people have told me is the appropriate kind of communication to come from someone running for Congress. I want to say it because it is interesting, because it may illuminate something deep, and because trying to understand such things is part of who I am.

Krugman has been watching with a combination of outrage and bewilderment the triumph of a policy of "austerity" not only in the United States but also in Europe (including the Cameron government in the U.K., and the policy decisions of the European Central Bank) in the face of this economic crisis.

Austerity is precisely the wrong thing to be doing. It makes the crisis worse. Witness how Cameron's policies are damaging the British economy.

Yet the austerity regime lives on, supported by what Krugman calls "zombie" ideas that somehow will not die despite all the evidence and theoretical models that show that they are counter-productive, and that they don't make sense.

Krugman eventually came to see it is a function of economic analysis being overwhelmed by some kind of impulse to see it all as a moral drama. The decision-makers have decided that the necessary response to the crisis is for there to be pain and suffering. Strangely, or not so strangely, their image of the proper way for pain to pay for the misdeeds of the past, in this morality play, is to see to it that OTHER people than the decision-makers are the ones to suffer.

Here's where my own small contribution comes in.

For 45 years, I've wondered about the meaning of "sacrifice" in the history of religions. I studied it first, when I was 20, when I wrote a thesis on the PSYCHOLOGY OF HEROIC TRAGEDY. The question has arisen a number of times since then: why is it that in so many religions, from different cultural traditions, through the millennia, the idea of sacrifice has played so central a role?

I am not sure that I've got any answer that wholly satisfies me. I'm still wondering what it is in human beings, or in such a large subset of them, that has this impulse that when things go awry --or in order to keep things from going awry-- the way to make or keep things right is to perform a sacrifice.

But here is what I do feel ready to say, without certainty but with an intuitive feeling about it: I believe that this insistence on austerity that Krugman notes is a manifestation in our own civilization of that impulse that led Greeks to slay bulls upon the altar and that led the Aztecs to sacrifice living human beings to their gods.

I am persuaded, with Krugman, that these policies are irrational, for they make things worse. And for otherwise intelligent people to ignore the economic evidence of their errors and pursue such a policy, the impulse to sacrifice (often someone else) when times are insecure must be very powerful.

In the U.S., this sacrificial austerity is combined with other forms of scapegoating the vulnerable. But that's because, unlike the other democracies, our political system is infected with additional dark impulses close to the heart of power-- impulses like rage and sadism, going after those least able to defend themselves.

But this austerity folly is not at all limited to the United States. And indeed, under President Obama, the United States has responded to the economic crisis more constructively than many of the Europeans.
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ANS -- The Bomb Buried In Obamacare Explodes Today-Hallelujah!

If this guy (and it's from Forbes Magazine) is right, Obama really has been playing chess while the rest of us play checkers. Read it. It's fairly short.
Find it here:  http://www.forbes.com/sites/rickungar/2011/12/02/the-bomb-buried-in-obamacare-explodes-today-halleluja/  
--Kim

12/02/2011 @ 3:44PM |324,139 views

The Bomb Buried In Obamacare Explodes Today-Hallelujah!

39 comments, 20 called-out
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Image by AFP via @daylife

I have long argued that the impact of the Affordable Care Act is not nearly as big of a deal as opponents would have you believe. At the end of the day, the law is – in the main – little more than a successful effort to put an end to some of the more egregious health insurer abuses while creating an environment that should bring more Americans into programs that will give them at least some of the health care coverage they need.

There is, however, one notable exception – and it's one that should have a long lasting and powerful impact on the future of health care in our country.

That would be the provision of the law, called the medical loss ratio, that requires health insurance companies to spend 80% of the consumers' premium dollars they collect­85% for large group insurers­on actual medical care rather than overhead, marketing expenses and profit. Failure on the part of insurers to meet this requirement will result in the insurers having to send their customers a rebate check representing the amount in which they underspend on actual medical care.

This is the true 'bomb' contained in Obamacare and the one item that will have more impact on the future of how medical care is paid for in this country than anything we've seen in quite some time.  Indeed, it is this aspect of the law that represents the true 'death panel' found in Obamacare­but not one that is going to lead to the death of American consumers. Rather, the medical loss ration will, ultimately, lead to the death of large parts of the private, for-profit health insurance industry.

Why? Because there is absolutely no way for-profit health insurers are going to be able to learn how to get by and still make a profit while being forced to spend at least 80 percent of their receipts providing their customers with the coverage for which they paid. If they could, we likely would never have seen the extraordinary efforts made by these companies to avoid paying benefits to their customers at the very moment they need it the most.

Today, that bomb goes off.

Today, the Department of Health & Human Services issues the rules of what insurer expenditures will­and will not­qualify as a medical expense for purposes of meeting the requirement.

As it turns out, HHS isn't screwing around. They actually mean to see to it that the insurance companies spend what they should taking care of their customers.

Here's an example: For months, health insurance brokers and salespeople have been lobbying to have the commissions they earn for selling an insurer's program to consumers be included as a 'medical expense' for purposes of the rules. HHS has, today, given them the official thumbs down, as well they should have. Selling me a health insurance policy is simply not the same as providing me with the medical care I am entitled to under the policy. Sales is clearly an overhead cost in any business and had HHS included this as a medical cost, it would have signaled that they are not at all serious about enforcing the concept of the medical loss ratio.

So, can private health insurance companies manage to make a profit when they actually have to spend premium receipts taking care of their customers' health needs as promised?

Not a chance-and they know it. Indeed, we are already seeing the parent companies who own these insurance operations fleeing into other types of investments. They know what we should all know – we are now on an inescapable path to a single-payer system for most Americans and thank goodness for it.

Whether you are a believer in the benefits of single-payer health coverage or an opponent, mark this day down on your calendar because this is the day seismic shifts in our health care system finally get under way.

If you thought that the Obama Administration chickened out on pushing the nation in the direction of universal health care for everyone, today is the day you begin to understand that the reality is quite the contrary.

If you believe that the end of private, for-profit health insurance is some type of nefarious step towards a socialist society, then you might want to attend church this Sunday to mourn the loss of health insurers being able to worm out of covering the bills of a cancer patient because she forgot to write down on her application that she had skin acne for three months when she was a teenager.

Of course, those of you who fear the inevitable arrival of universal health care really shouldn't be too fretful. There will always be a for-profit health insurance industry for those who want to pay for it. The only difference will be that those who cannot afford private coverage will also have an opportunity to get their families the medical care that they need

Everyone wins-except the for-profit health insurers.

I can live with that.

 

 

contact Rick at thepolicypage@gmail.com

twistter @rickungar

read Rick's column on politics at washingtonmonthly.com

 

ANS -- This is our new normal

the Weekly Sift says this about this article: 

Adam Haslett looks at the current economic crisis as part of something that has been playing out for four decades: slower growth, economic manipulations increasingly beyond the ken of ordinary voters, and the consequent shifting of power to unelected technocrats whose loyalties may not be to the People.

Unfortunately, like most articles, it offers no solution to the problem.  I offered our solution in the comments, but the only other solution I saw was "eat the rich".  It may come to that.....

Find it here:  http://www.salon.com/2011/11/30/is_the_financial_crisis_now_permanent/singleton/   
--Kim





Wednesday, Nov 30, 2011 11:40 AM Pacific Standard Time

This is our new normal

The economic elite who caused the global recession are tasked with fixing it -- and they'll fix it in their favor

By Adam Haslett


Protesters shout slogans as they protest against austerity policies in Greece.  (Credit: Reuters/Grigoris Siamidis)
Topics: Occupy Wall Street, Germany, European Union, European Financial Crisis

"Everything seems to be running exactly on schedule here, which is not what you expect in Italian politics … It looks like by Monday the markets will have Monti as their Prime Minister."   ­BBC TV Rome correspondent, Nov. 12, 2011

As we move further into the fourth year of the global financial crisis, the questions of where it will end are becoming ever more insistent. When will political leaders finally come up with a solution? When will the atmosphere of dread and panic subside? Put most simply, when will life get back to normal?

There have been recessions before. Unemployment has risen, government revenues have dropped, but after a couple of years some combination of economic policy and new consumer demand has turned the tide and Western democracies have reverted to politics as usual, with parties of the left and right arguing over the distribution of social goods within their own countries. Why isn't that happening again?

There are plenty of answers that speak to the immediate causes: the economic stimulus packages on both sides of the Atlantic have been too small to restart substantial growth; the European Union bureaucracy has been dysfunctionally slow to respond; the euro zone lacks a process for countries to give up the currency.

But as most people can sense by now, the changes we are experiencing go well beyond these headlines. In many countries, the fundamental political and economic bargain of postwar society is in the process of coming apart. The question, then, isn't when will public life return to normal? It won't. Nor should we be asking when will the crisis end. It won't end for a very long time, perhaps decades. And it will change most people's lives more profoundly than the end of the Cold War or 9/11 ever did.

- – - – - – - – - -

For two and a half decades after World War II, the West enjoyed a remarkably sustained period of economic expansion. Industry thrived, wages grew, there was something close to full employment and tens of millions of people entered the new middle class.  Modern consumer society was born. By the late 1960s, however, this expansion had begun to sputter out. This was not just an economic problem but a serious political one, because businesses had become accustomed to sustained growth and voters to plentiful jobs and steadily rising income. Deviation from this condition was seen as an aberration that the government was obliged to fix.

As Wolfgang Streeck, managing director of the Max Planck Institute for the Study of Societies, has recently argued, this problem of slower growth in the West from the 1970s onward ­ and the societal expectation that it be overcome ­ led to a series of crises in the capitalist system. The first was inflation. Faced with recession in the early '70s, governments eased monetary policy, i.e., printed more money, to raise consumer demand and ward off unemployment. But by the end of the decade inflation had reached the point where investors no longer found it profitable to risk their capital in new ventures and unemployment began to rise. In the early 1980s, again faced with recession, most governments turned instead to large public deficit spending to boost consumption, and in the U.S. and Britain in particular, they aggressively took on unions in an effort to break their power to demand wage increases.

But by the beginning of the 1990s, the resulting national debt and annual budget shortfalls had begun to worry financial markets and they were turned into a major political issue. In trying to maintain economic growth while at the same time cutting the deficit, both Washington and London dramatically deregulated their financial industries, leading to what some economists call "privatized Keynesianism." By allowing financiers to invent and market endless new forms of private debt, these governments in effect shifted the site of borrowing from sovereign states to companies and individuals who could now fund their own current consumption (and speculation) by borrowing from their own future.

What ensued were two asset bubbles, the first in Internet stocks in the late 1990s, and the second, far more devastatingly in American real estate and the financial instruments derived from it, so-called mortgage-backed securities, which brought down Lehman Brothers in 2008 and began the current crisis.

- – - – - – - – - -

Seen in historical context, then, what we are experiencing right now is not simply a particularly severe economic contraction in the ordinary business cycle which will eventually abate. It is the acceleration of an endemic crisis in Western economies that has been building for four decades as we have attempted to replicate the supposedly "normal" economic gains of what were in fact historically anomalous postwar years. This is not to say there hasn't been substantial growth since the 1970s. There certainly has been. But unlike during the postwar period, its distribution has skewed steadily upward producing an ever-greater inequality of income, particularly in the U.S. While GDP has grown, more in some countries than others, real wages have stagnated over the course of the last 40 years. In addition, over the last 20 years, the deregulated financial industry has become so politically powerful it can effectively block any serious reform of its practices, particularly on a global scale where reforms are needed most, thus locking in the trend of the upward distribution of any overall economic gains.

One of the related effects of this dramatic rise of finance capitalism has been to steadily erode the general public's ability to understand how the modern economy actually functions. Most people can understand what political forces are at play when a union demands higher wages and a company resists, citing foreign competition. We can choose which politician to vote for based on the position they take in such a conflict and have a reasonable sense of whose interests we are supporting by so doing.

But what happens when a politician says we must lend billions of dollars to undercapitalized banks or indebted countries in order to provide liquidity to the financial system, and if we don't we will enter a depression or blow up the euro? The content, let alone the truth, of such a proposition is hard for most people to assess. More troubling still, their assessment doesn't much matter anymore. Because the answer to the question is now considered technical and because the situation demands immediate action, the key decisions are made without democratic consultation by financial bureaucrats working with private bankers. The public is relegated to the role of bystander, reading reports of what the (supposedly neutral but in fact determinedly free-market) technocrats have decided in the name of saving the economy. Financial policy becomes more like foreign policy, conducted by an executive strong-arming a parliament or legislature under conditions of emergency.

And so people get angry: They get angry at bankers, at politicians, at entire countries for not budgeting more carefully, and at the press for failing to explain what's going on in such a way that they can understand where their interests actually lie.

Which brings us to our current moment. In the United States the bleak economy and the increasingly oligarchic division of wealth have led to protests on a scale not seen since the 1960s. In Europe, the euro is in danger of collapse and the entire postwar project of integration could conceivably begin to run in reverse, far more quickly than most people imagine.

Under intense pressure from the bond markets, Greece and Italy have essentially suspended their democracies and agreed to the installation of European bureaucrats (and former Goldman Sachs advisors) as their prime ministers. Their assignment is to impose steep cuts in public spending, raise taxes and privatize state-run enterprises at a time when their economies are either stagnant or already shrinking. This operation will be painful, the authorities in Brussels and Berlin say, but they will save the patient.

There are sound and, in fact, quite conventional economic arguments about why this will not work. Take the example of Ireland. It accepted these same conditions in order to escape having to pay such high interest on its sovereign debt. In return, it got a European bailout. For a time, the interest rate it had to pay to borrow money declined. But once investors examined how deeply the Dublin government was cutting spending, they decided the Irish economy was unlikely to recover any time soon, there being so little demand for goods. Thus, precisely because of its austerity, Ireland's bonds now have a higher interest rate than before the bailout, setting the stage for further disaster.

But there is another ­ and in many ways deeper ­ reason why the technocrats put in charge in Greece and Italy are likely to fail, and it is related to the larger story of where Western capitalism has been heading for the last 30 years. The decisions the technocrats make will lack legitimacy with the populations they govern. In Europe, this is made clear by the imposition of the leaders by external forces. In the U.S., the imposition of the market's sovereignty is felt through the now unlimited corporate campaign contributions that effectively circumvent the public preference for a more equitable distribution of income by bribing the Congress. In both places, the demands of the financial elite run against the popular will, and in both places the popular will is being ignored. There is no reason to believe that these abrogations of popular sovereignty cannot be sustained for a very long time with the tactical application of force. But if they do persist they will lead us into a condition we would no longer recognize as democratic. Capitalist, yes. Democratic, no.

- – - – - – - – - -

I write this article from Berlin where I have been living for the last three months. I've had occasion while I've been here to talk to a lot of people from the worlds of business and finance as well as ordinary Germans. And most all of them have held Germany up as the counter-example of what I've been describing thus far. The economy has done quite well over the last several years; unemployment continues to decline; there has long been greater cooperation between capital and labor. And here the popular will is being followed. Most Germans don't want to send more of their tax money south to bail out countries they see as profligate and poorly managed. And their government's policies more or less reflect that preference. If the crisis leads more countries to be more like Germany ­ living within their budget, enforcing their tax laws ­ than so much the better, they say.

As an American, I hail from a country whose banking sector and previous government are more responsible than any other for virtually all the trends toward instability and inequality I have been discussing, so I say what follows with all due humility. German prosperity relies on exports. As global confidence in the euro zone has declined so has the value of the euro, making German goods more affordable all over the globe. Indeed, for several years now, the worse the crisis gets for Europe's southern rim, the better the German economy does. This is not entirely the German government's fault, and it's certainly not the German people's fault. But it has created a perverse dynamic in which the very instrument that was meant to bind Europe even closer together ­ a common currency ­ now threatens to tear it apart.

And this is a tension that cannot be sustained. If enough members of the euro zone are driven into recession by German demands for austerity, and if major, basically solvent trading partners like Italy are pushed toward sovereign default, then Germany's fortunes will decline. Moral bromides about countries having to live within their means like ordinary families will do no more good for Germany and Europe than they do for alleviating unemployment in the U.S. The structure of global finance is fiendishly more complex than a family checking account and politicians who suggest otherwise, including Barack Obama of late, are doing the public a disservice.

The prospects for even a short-term solution of the European crisis seem dimmer than ever as the interests of different nations within the euro zone are increasingly set against each other in the popular press. Comity seems a long way off and the democratic legitimacy of any resolution even further afield.

It is little comfort to be able to step back and see that this crisis is part of a much broader and endemic instability in Western capitalism that continues to redistribute wealth upward, weaken democratic institutions, and concentrate power in the hands of the few. But it is this larger force, not the daily ups and downs of the current troubles, that will continue to shape our lives for decades. Even if we cannot at present see a path to reversing this force, we can at least endeavor to understand it more clearly.

Adam Haslett is the author of the novel "Union Atlantic." His story collection "You Are Not A Stranger Here" was a finalist for the Pulitzer Prize.More Adam Haslett

ANS -- Massachusetts Announces First Comprehensive Lawsuit Against Major Banks

Here is a short article about the banks being sued for illegal foreclosures.  I hope you heard about it elsewhere, but just to make sure you did hear about it, here it is.  Holding them accountable is important, but I'm afraid it comes too late for those who lost their homes for no good reason. 
Find it here:  http://www.nakedcapitalism.com/2011/12/massachusetts-announces-first-comprehensive-lawsuit-against-major-banks.html
--Kim

Thursday, December 1, 2011

Massachusetts Announces First Comprehensive Lawsuit Against Major Banks

The Massachusetts Attorney General has announced a major lawsuit against the biggest banks in the foreclosure game, namely Bank of America, JP Morgan, Citigroup, Wells Fargo, GMAC (now Ally) as well as MERS and its parent MERSCorp.

It seeks accountability for violations in the foreclosure process, including robosiging, initiating foreclosures when they were not entitled to do so, the use of MERS (both a violation of land records requirements and what amounts to unjust enrichment via failure to pay local recording fees) and deceptive practices in foreclosure (as in failing to offer modifications as required by law and would be good for borrowers).

In the press conference, Coakley described that there were numerous unnecessary and illegal foreclosures, and cited how not for profits had succeeded in obtaining loan mods, yet were unable to get mods processed for vastly larger number of similar borrowers.

She stressed how the banks didn�t care about the impact of their actions on borrowers and communities, and engaged in the same sort of reckless conduct as they did in predatory mortgage lending.

Coakley specifically discussed what amounts to a failure of the 50 state settlement negotiations, particularly the failure of the banks to provide accountability and their insistence on obtaining broad relief, including on MERS-related issues, which Coakley said Massachusetts had said was always off the table as far as she was concerned. She had said the negotiations had taken too long and were unwilling to provide real relief.

This is an important step forward, and shows clearly what a sham that the so called �settlement� talks.

The claim is detailed and the banks look to be in very hot water. The lawsuit, for instance, describes the specific and detailed steps that a bank must take in order to disclose in Massachusetts (including giving the borrower the right to cure the default before accelerating the debt) and also (per Ibanez) questions whether the parties had taken the steps to put themselves in a position to act. It describes how the target banks did not have the mortgage at the time of filing for foreclosure.

Coakley said she intends to move the litigation forward quickly.

The claim is here. This is an important step forward.

ANS -- The Explosive Story That Could Burn Electric Cars

Here is an article about the problem with electric cars going up in flames.  If you read to the end you will see that it only happens after a bad crash and it's the damaged battery after a crash that has the problem, it's fixable, and it also happens to gas cars.  but it's the reputation that's the problem here.  Who is trying to ruin the reputation of electric cars?
Find it here:  http://www.theatlantic.com/business/archive/2011/11/the-explosive-story-that-could-burn-electric-cars/249288/
--Kim


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The Explosive Story That Could Burn Electric Cars

By Jordan Weissmann

Nov 30 2011, 2:58 PM ET 61

The government is investigating the Chevy Volt for being a fire risk. That's bad news for GM and fans of green cars.  



Reuters

Few phrases give car-makers nightmares like the words "fire hazard."

The reasons are fairly obvious. Nobody wants to drive their family around in a rolling tinder box. And the image of a burning vehicle can cause lasting damage to a company's brand. More than 30 years after it was taken off the road, the famously combustable Ford Pinto is still shorthand for everything that can go wrong with a car design.

So executives at General Motors are probably are losing sleep now that auto-safety officials are investigating whether the company's prized Chevy Volt poses a fire risk after a crash.

The National Highway Transit Safety Administration announced its official inquiry on Friday, but the issue had been building up for months. It first emerged back in May, when a Chevy Volt caught fire three weeks after a side-impact crash test. The test involved slamming the car into a pole, rolling it over to simulate a particularly nasty accident, and leaving it to sit in storage, where it eventually went up in flames. The NHTSA concluded that damage to the car's lithium ion battery was responsible. It ran three additional tests where they beat up a few batteries in a lab, two of which eventually caught on fire, as well.

It's an unpleasant story for GM. But it's also bad news for the rest of the electric car movement. The Volt is no ordinary sedan. It's a standard bearer. When GM was seeking a bailout from Congress, it trotted out the plug-in hybrid electric Volt as proof that the company was changing its truck-obsessed ways. Since then, executives have taken to calling it GM's "moonshot." Fewer than 6,000 have been sold. But the company already has plans to use the Volt's engineering on other models, such as a new Cadillac.

For all those reasons, the car generates an inordinate amount of media attention. And arguments about its success or failure have a habit of turning into bigger discussions about the future of green cars in America. So it's not hard to imagine how, in the public's imagination, questions about Volt's safety could easily turn into bigger questions about electric vehicles overall. After all, there's not much difference between the Volt's battery and, say, the Nissan Leaf's. Already, The Wall Street Journal has already run a piece titled, "GM's Volt Woes Cast Shadow on E-Cars."

They shouldn't.

As of now, there's no evidence that drivers have much to worry about, with the Volt or any other electric vehicle. The government still believes the Volt is safe, since the fires have only happened well after crash tests. GM says it's developed appropriate post-crash steps for removing and discharging Volt batteries, which would eliminate the risk of a fire.

There's also no sign at this point that the Volt is any more of a fire risk than your average gasoline-powered car. According to the National Fire Protection Association, more more than 280,000 vehicles catch fire each year, causing hundreds of deaths. In 2009, Ford recalled millions of vehicles when it discovered faulty cruise control buttons were catching on fire. Audi, BMW, and even GM have also had fire-risk related recalls on gas-powered vehicles in last few years.

But again, the Volt is as much a symbol as a car. That's why it's a favorite target of pundits like Fox's Neal Cavuto, who aired a segment on the fires titled "Hybrid From Hell." (One of his guests describes it here). How bad could the Volt scandal get? Think of the hysteria over Toyota's "sudden acceleration" problem -- which government engineers never corroborated -- and add flames.

GM has been out in front of the issue so far. The company has been more communicative than Toyota ever was during its own crisis, the LA Times reported. It has already offered loaner cars to any concerned Volt owners, and says few drivers have accepted. But the story is far from over. How GM handles it will have lasting implications not just for the company, but the industry as a whole.