Helicopter to Hell
Category: News and Politics

Question: What could be worse than Hank Paulson's $700-billion proposal to pay banksters too much for worthless derivative securities?

Answer:  "Helicopter Ben" Bernanke on the loose, dropping more than $1 trillion on the banksters, in loans based on their garbage securities' FULL FACE VALUE (hyperinflated by up to 200 percent).

While our eyes and hopes were on the House vote yesterday, Bernanke had ALREADY announced another $630 billion in "emergency lending" -- most of it secured by the very worst of the dog bets.  If these huge Fed loans go bad, as many doubtless will, we get to keep the trash ...

(This has been made a Dandelion Salad Exclusive, so please read on over there.)

2:45 PM - 3 Comments - 4 Kudos - Add Comment

Wall Street wants us to panic, but stocks are just way overpriced.
Category: News and Politics

If you're hyperventilating about the stock market this morning, please calm down.  What's underway is simple Market Justice.  Artificially inflated prices can't be sustained forever -- not for $700 billion or any amount of cash.

For years and years, the housing bubble fed the stock bubble and vice versa.  Far too much money poured into both asset classes, so this isn't a problem more money will solve...

(Lo chose this to be a Dandelion Salad Exclusive, so please continue reading over there.)

12:27 PM - 4 Comments - 4 Kudos - Add Comment

Want to stop the banksters’ bailout?
Category: News and Politics

Rallies are being organized today by Democracy for America, so there may be one in your neighborhood. 

Sadly, there's none in Albuquerque, but I just sent a fax begging Democratic leaders in Washington to stop the lunacy. For several days, I've been writing a huge blog on the subject (tying it to all the other obscene 11th Hour Grabs underway); with luck, that should be ready to post here by tomorrow.

In the meantime, please feel free to cannibalize this fax, adding your own Democratic senators and/or representatives to the list of recipients:

FAX TO: 

Senate Majority Leader Harry Reid, 202-224-7327

House Speaker Nancy Pelosi, 202-225-8259

Financial Services Committee Chair Barney Frank, 202-225-0182

Senator Barack Obama, 202-228-4260

 

Dear Gentlepersons:

 

If the proposed bailout goes through in ANY form, we'll soon be left with no money for anything else -- and it won't even work to restore lending.

 

The QUADRILLION-DOLLAR derivatives bomb aimed at us has to be dismantled by the players.  Trust can't be restored among them, until they admit where all the pieces are and how big they are (as many experts, including Robert Reich, have pointed out).

 

Too, these are only hyperinflated side bets with no essential relationship to the productive economy.  Most are matched sets in which party A bet one way and party B bet the opposite, so they should simply nullify the contracts and refund whatever sums were paid up-front (a tiny fraction of what they're trying to get out of taxpayers).

 

Paulson's plan isn't just cash for trash, it's cash for HOT AIR.

 

You're all economically sophisticated people, so I'm not telling you anything you don't know. 

 

I'm sure you're also aware that, even if the cost of this bailout is paid through a tax on future stock trades or a temporary surtax on the very wealthy, that money would be better spent on other things than to enrich multinational organizations that already have far too much power over every government in the world and now, on the pretext of "reform," are pushing to consolidate all financial regulatory power in the U.S. under the Fed, demonstrably a handmaiden to the international banking cartel.

 

At its core, this lightning raid on our Treasury (or, rather, its remaining ability to borrow) is the strategic equivalent of what Bush is trying to pull off in Iraq, by binding subsequent administrations to agreements made now.  The Wall Streeters' stickup would be more than sufficient to achieve the Republican dream of cutting off social spending in America -- because no future leaders will be able to afford any!  If it goes ahead, we can not only kiss the prospect of universal healthcare and a "green jobs" initiative goodbye, but we'll also risk losing Social Security and everything else a civilized nation is supposed to collect its tax dollars for, maybe even public education. 

 

Please, please explain to the public what's really going on and stand up for the American people against global predators who scorn democracy, crush real competition and prize only money and power, feeling no bonds of patriotic loyalty or human empathy. 

Besides stopping this insane bailout, please also stop the further sale of exotic derivatives and predatory mortgages, as well as speculation in commodities by those who aren't in the commodities business.  And how about using anti-trust powers to break up anything that's "too big to fail"?

 

Thank you for your time.

12:08 PM - 4 Comments - 4 Kudos - Add Comment

Companies Change Hands in Fantasyland
Category: News and Politics

An intended corporate buyout in the billions has been announced with utterly no reference to where either firm is based.  For all we're told, both parties to the deal are extra-cartological -- off in Terra Incognita or "Here Be Dragons" land.

Simple case of sloppy journalism, one might think -- except that the source was The New York Times, citing Reuters.  The story HERE informs us that a giant pharmaceutical company called Teva is to purchase one of its rivals, Barr, for $7.46 billion in cash and stock -- representing $66.50 a share, a generous 42 percent premium over Barr's closing price at mid-week.  The author also bothers mentioning "a wave of consolidation in the generic-drug sector that some analysts suspect will result in only a handful of major global players" and says that Teva – already world leader in generics -- will now command a staff of 37,000 and operate in more than 60 countries, gaining the foothold in Eastern Europe that Barr acquired in 2006 with the Croatian firm Pliva.  (Presumably, the location of a company was still regarded as newsworthy two years ago.)

Now, however, we have to click the right links for investment information to learn that Teva's home base is in Israel and Barr's in the USA.  Thus we can determine that the most likely immediate cuts to that staff of 37,000 will be in Woodcliff Lake, New Jersey.

With a little further sleuthing, we can determine who's to blame for this extraordinary omission.  It wasn't Reuters. THEIR STORY is greatly detailed and raises the possibility of other suitors vying for Barr, as well as the issue of anti-trust risk (although unnamed "analysts" deemed both chances remote).

Interestingly, Reuters points out that Teva has bought three other US drug companies in the past two years: Ivax (for $7.4 billion), CoGenesys (for $400 million) and Bentley (for $360 million).

Had The Times put forward more complete information, perhaps the idea of anti-trust action wouldn't be such a non-starter.  Could this be why they don't even state in passing that yet another American company is slated to bite the dust?

Beyond the fact that it's high time for the leaders of governments to climb out of the pockets of transnational grillionaires and protect their citizens' livelihoods, imagine what will happen to generic drug pricing, if only a few firms soon control them all.

6:21 AM - 4 Comments - 5 Kudos - Add Comment

The Other Gas Crisis
Category: News and Politics

Given the impact of speculative greed on gasoline and food prices, it's hard to enjoy a picnic this summer, let alone a vacation trip -- but these will seem like the good old days, come fall and winter.  We'll be not only hungry and house-bound then, but also freezing our fannies off, because the cost of natural gas is rising at nearly twice the rate of oil!

So far this year, natural gas is up by a whopping 76 percent.  That makes the oil price hike look puny at 42 percent and even outdoes corn's riot-inducing 58 percent increase.

Don't think you're off the hook, if you heat with electricity.  Many power plants are running on natural gas these days, including virtually all built since the turn of the century.  This is one reason why it's a can't-miss bet for futures traders -- the additional causes being an explosion of McMansions across the landscape and the biofuels boondoggle.  (Few realize how much natural gas it takes to grow and distill agrofuels, but the hedge funders and other predators definitely get it.)

BTW, for those who heat with oil and think maybe they'll catch a break for a change, don't bank on it.  The outfit now holding the largest supply of heating oil in New England is Morgan Stanley, as came out in a recent Congressional hearing on commodities market manipulation.  Their actually taking delivery of the stuff is no doubt a ploy to keep themselves in the game, if purely financial investment is finally restricted -- but those capable of such a dramatic move can be assumed capable of profiting richly from it in every way.

So, in "gather ye rosebuds while ye may" spirit, it would behoove us to prepare during warm weather for the heating season.  It's obviously a lot more comfortable to replace inefficient windows, improve insulation, futz with weather-stripping and so forth, before cold winds start to blow, and such efforts will be rewarded also by savings on air conditioning.  I intend to install seriously thermal window-coverings, having read that they produce remarkable bang for the buck, and look into adding some skylights and south-facing windows for solar gain.  Even projects that might have seemed unaffordable previously deserve to be reconsidered in the light of natural gas rates poised to double -- or worse -- by the time you turn your furnace on again.

2:12 PM - 3 Comments - 4 Kudos - Add Comment

Carbon Trading Is Just Another Derivatives Scam
Category: News and Politics

Being so often sold to the highest bidder, governmental legislation has been a product for a long time, but lately it's deliberately spinning off other products, too.

Mind you, these aren't products in any rational sense.  Nothing tangible will be produced – not a road, not a sofa, not even a sandwich. Just money and other paper for elites who'll trade so-called "new assets" created out of whole cloth (or, rather, dirty air) will result if supporters of the Lieberman-Warner climate change bill have their way. Its cap-and-trade provisions will commodify pollution in America into the basis of an "industry" so immense that $150 billion will supposedly spring into being during its first year (and $3 trillion between now and 2050).

These figures in fact represent fictitious value that will have to be sucked out of the productive economy somehow. That's how trading derivatives always works.  The principle was elegantly encapsulated by a gentleman who commented last month on one of Ambrose Evans-Pritchard's columns in the London Telegraph.  He was specifically addressing derivatives associated with commodities like oil and food, but the same trick lies behind the mortage securitization scam and any other bubble. Walt O'Brien wrote (emphasis mine):

... Derivatives are a means of introducing superfluous layers of financing to otherwise pretty tame trades in commodities. On a straight commodity exchange for a tanker owner or freightforwarder who ... wants to move a couple of million gallons ... oftentimes a factor is used (something now called "accounts receivables financing"). The tanker owner ... (makes) a deal with the factor and the buyer where ... the tanker owner takes receipt of the full value of the cargo less the factor's discount -- usually 3 to 7 percent simple interest – and ... the tanker owner and/or freightforwarder know they are paid for the cargo and aren't held up in demurrage at the dock while the greedy buyer tries to starve them out for a lower rate per gallon. If a derivatives trader is involved, the deal is between the fuel supplier and the trader. The trader fronts the cargo in transit with bank money ... chats up the value of the cargo in transit and adds as much as 30-40% of non-value-added cost to the cargo in the process, which the trader then pockets, and the banker pockets ... associated fees and interest. How many layers of useless and unnecessary derivatives trading can you plotz onto a commodity trade? Answer: in theory, an infinite amount; in practice, the highest number of ... re-re-re-financings I've seen is 15 layers of needless trades on one consignment. This ... trade boosted the cargo cost -- not value, as the cargo price for the carrier and cargo owner in transit did not ... change at all, though the cargo owner, to cover the derivatives had to stick the customer with his price plus the derivatives trades -- by a factor of 12 times true cost. The bourses of the world are starving ... the black and Asian world through extortion of unnecessary money while ruining the value of your currency... Annual payouts to derivatives traders looks to be at US$62 trillion, according to this Economist article ("Taming the Beast" in the April 19 -25 edition). That $62 trillion, if expressed as food, energy and metals commodities, could be the vehicle for the New Millenium to move forward in hope and in earnest, but instead is going to golf turf fees, amusing clarets and...eco-tourism by really fat and greedy people who constitute about .005 percent of the population.

Sadly, what's due to be bruited about soon in Washington is NOT whether we should launch ourselves into this lunacy at all, but merely who's to be handed how much of the first $150 billion in fairy money: chits representing the "right" to pollute at a certain level.  Of course the polluters want them free, claiming their charges to consumers will rise horribly otherwise.  Other proponents – including environmental groups and both Democratic presidential contenders – want the chits auctioned off to generate some form of public benefit.  Conciliators favor splitting the difference.  See Marc Gunther's recent analysis for a wealth of detail.

The fundamental problem is that almost nobody's saying hey, let's stop and think before creating another Mad Max market to rob everyone else blind for the sake of the players; couldn't we just pass a law that simply says you WILL reduce pollution by x amount within y timespan, or be subject to penalties?

Exactly the same aversion to laws with no payola for the bankers, traders and mega-corporations is apparent in our government's apprroach to alternate energy -- setting things up in such a way that big business controls it and has already spun off a myriad of derivatives  in solar and wind power (a subject for another day) – and equally apparent in how our legislators are dealing with the housing meltdown.

As Dean Baker pointed out this week, we needn't create yet more mortgages to be securitized, sold and resold, in order to avert foreclosures.  The simple solution would be a law allowing residents to remain in their homes by paying fair market rent.  This would prevent a further price-depressing glut on the housing market and also prompt banks to renegotiate their customers' mortages, rather than become landlords.  Instead, Congress is tussling with a complex bailout proposal that would have the Federal Housing Authority guarantee new lower interest rate mortgages and put taxpayers on the hook for another $1.7 billion (or, as the ranking Republican on the  Senate Banking, Housing and Urban Affairs Committee, Richard Shelby (R-Ala.), prefers, swipe those funds from assistance to low-income renters).

I can see no surer route to utter ruin for most people than keeping the "structured finance" contingent in the catbird seat, sucking the world's real economy dry with more and more derivative schemes.   However, our elected representatives in Washington lack a grain of economic sense or are completely in thrall to Wall Street.  Either way, it's probably far too late to stop carbon trading here, given that it's so entrenched in Europe.  Normally our Pig Men lead the world – off various cliffs, in case you've been dozing since before the dotcom bust – but, in carbon trading, Europe has the jump on us.  Lured by an annual volume that reached $50 billion last year, Morgan and others have already crossed the Pond to play.

And, yes, you're throwing candy to the same beasts if you buy carbon offsets.  We need real laws, not tricky financial mechanisms.

6:23 AM - 4 Comments - 8 Kudos - Add Comment

Grassing for Dollars
Category: News and Politics

"Crime doesn't pay, but we do," advertise police in Jacksonville, Florida.  This and similar campaigns from coast to coast have created a new cottage industry for the downtrodden: turning in their friends, neighbors and even family members. As Sgt, Zachary Self, who answers Crime Stoppers calls in Macon, Georgia, and recognizes the voices of those who've phoned before, observed, "Two or three arrests per week, you could make $700, $750 ... better than a minimum-wage job."

Actually, the take varies from market to market and can be as little as $50 per arrest, but there's the possibility of a bonus, should a gun be recovered, and these pittances can add up for those who move in certain circles.  The real profit, however, stands to be made by the corporate prison industry. No doubt they're thrilled that tips are up from 25 to 44 percent for the first quarter of 2008, over the same period last year. It's another blessing of recession for those who run our world. "We're kind of banking on that, really," admitted Trish Rouette, Crime Stoppers coordinator in Florida's Lee County, site of our nation's top home foreclosure rate in February and March and the recent loss of a vast number of construction jobs.

This shocking account, which evokes the glory days of Hitler Youth, is in today's New York Times -- an edition that also reported on a new crime museum in Washington, DC.   Among the family attractions of this neocon freak show will be information on how to report crime, as well as opportunities to watch Fox TV's John Walsh host "America's Most Wanted" and to participate in the virtual shooting of a suspect.  Its creator, John Morgan, owns various amusement parks and a Florida law firm and believes, ''We as Americans, we as people, have a deep, deep fascination with crime and punishment.''

Although I personally attribute the semblance of that sad obsession to a tedious superfluity of crime-based TV shows and films and would love to see them all vanish, the Times tells us a "somewhat similar National Law Enforcement Museum is slated to open" in the vicinity of Morgan's venue.

Can anyone seriously doubt that all the crime hype is just another circus to distract us while the Masters of Universe continue to impoverish the public – even to such an extreme that many will spy for the police state to make their rent or keep the lights on?  Mind you, I'm no apologist for those who commit serious offenses, but the bulk of this is bound to concern victimless, drug-oriented rubbish and we already have far too many non-criminals behind bars.

3:10 PM - 6 Comments - 6 Kudos - Add Comment

Dungeons and Despots
Category: News and Politics

Like others raised before the age of infotainment, I was taught to scorn the voyeuristic impulse.  I wouldn't dream of watching a building burn, slowing traffic to gawk at a smashup or reading beyond unavoidable headlines about celebrity meltdowns, cult busts and diableries du jour.

However, the Austrian dungeon tales have drawn me in.  They're actual news, in an allegorical way.

Really, could there be a more perfect example of microcosmic/macrocosmic similitude?   I was thinking that already, when this line in a business story underscored it: "I have this feeling that there is a wall in front of us."

Axel Marceau, identified by The New York Times as "a 41-year-old schoolteacher living outside of Frankfurt...(whose) father had a teaching job that afforded the family upward mobility, from owning a home to fancy ski vacations," went on to say, "We're just not going to get any further... (W)e've been in a slow process of losing to the people up top."

"A wall."  "The people up top."  See what I mean?  Betrayed by our supposed protectors, we're in the grip of a monstrous evil. Elisabeth Fritzl and her children call it Father; Axel Marceau calls it Fatherland.  In all its forms, the tyranny of powerful sociopaths has crafted hell on earth for its captives.

In Madrid, Maria Salgado, a TV director and divorced mother of two, is scraping by on little more than she earned 14 years ago as a novice.  "The middle class used to live well.  And if you have lived well, it's hard to live so badly," she said, adding that her daughter asked if they were poor, because they can no longer shop at health food stores or buy fish more than once a week. "I'm surprised we haven't started a revolution," she observed.

"I look at people on the bus and they seem sad and beaten down," said Francesca Di Pietro, who works in Rome but can't afford to live in the city.  She and her partner, both in their 40s, earn middle class wages, yet have to pack lunch, buy secondhand clothes and get beauty school haircuts.  "We should be feeling more combative," she remarked, "but really all we feel is frustrated."

A typical couple of the French middle class reported sinking farther into debt every month, despite selling one of their cars due to gasoline prices, giving their son powdered milk and baking their own bread.  "In France, when you can't afford a baguette anymore, you know you're in trouble," said Anne-Laure Renard, a teacher.  "The French Revolution started with bread riots," she noted.

Across the Channel, London's Daily Mail recently completed an analysis that showed "food costs alone are rising at 15.5 per cent a year - more than six times the official rate.  And there are double-digit increases in other ... essentials such as petrol, gas and electricity. Many families need ... more than £1,200 extra a year just to stand still.  Once higher mortgage costs are added, millions ... (need) at least another £2,000 a year to keep their heads above water."

Despite sharp drops in buying power due to "free trade" policies imposed through our governments by conscienceless oligarchs, the shrinking middle class of Europe are substantially better off than we are.  They have universal healthcare, a stronger currency, a higher wage (both minimum and median), better access to higher education and unions that retain some strength.  Even their poor are more secure than we, thanks to social safety nets that keep everyone who seeks help fed and sheltered.

Thus, within this hell of exploitation in which all but the few – our oppressors – reside, distressed Europeans occupy the top circles.  Americans who work for a living exist on several levels between them and the world's most wretched, descending from those struggling to hold it together to those in extremis: the dispossessed, the sick who have no hope of care, the unemployed, the hungry.

Recognizing that all who lack independent wealth are together in the same dungeon now, we must also admit the only difference between workers surviving in some comfort and the Haitians eating dirt is one of degree.  Given time enough, those who prey on us will reduce our circumstances equally.  They call what they've been doing to us for decades Labor Arbitrage.  If we have a lick of sense, we'll start calling it crime and demanding an end to government complicity.

1:27 PM - 5 Comments - 4 Kudos - Add Comment

Food Fights: Predation vs Protection
Category: News and Politics

The most mercantile "Earth Day" yet – one that stretched into an "Earth Week" of consumerist hype – left a foul taste in my mouth this year, amid all the news of famine. However rightfully we fret about polar bears, plastic bags and the Amazon, the real urgency is feeding hungry people.

In true "Shock Doctrine" style, some have taken this crisis as their cue to make matters worse: Robert Zoellick, for one.  An original "vulcan" responsible for the Iraq debacle, as well as a former U.S. Trade Representative, Deputy Secretary of State and Goldman Sachs executive, he's the neocon now running the World Bank.  While hustling governments to make up a $500 million shortfall in the UN's food aid program, caused by suddenly rocketing prices, he's been screaming, "The solution is to break the Doha Development Agenda impasse," claiming, "It's now or never," inveighing against export controls and declaring himself willing to help Africa by doubling its debt for agricultural spending – with, of course, "increased private-sector initiatives."  And why wouldn't he be willing?   His economy-destroying, resource-grabbing bank and its ally in crime, the International Monetary Fund, have almost no customers left, now that South America wised up.  These days, they get to prey only on the poorest of the poor, apart from Turkey.

His is a pitch as brazen as Treasury Secretary, IMF Governor and ex-Goldman CEO Henry Paulson's proposal to give total control of financial markets to the Federal Reserve – after the Fed let them run mad for years, collecting huge fees and bonuses for wrecking the housing and credit markets, plus bailouts at taxpayer risk – but Zoellick has a subtle side, too.  This heartbreaking story about conditions in Mauritania, for instance, is salted with sneaky "free trade" talking points and deceptions.  But the people aren't starving because well-intentioned trade policies failed; they're starving precisely because they got suckered into a scheme designed strictly to benefit transnational corporations – like the European companies that send fishing fleets to deplete Mauritanian waters.

3:59 PM - 3 Comments - 3 Kudos - Add Comment

Rich vs Right
Category: News and Politics

It's become fashionable to rail about how dumb Americans are – and, yes, we do tend to share some collective impairments (notably in world geography and languages) – but I'm struck again and again by the collective wisdom of my compatriots.

I often learn more from comments on a blog than from the original essayist, even if highly credentialed, and some who call talk show hosts on AirAmerica and NovaM reveal similarly transcendent insight.  Radio being such an ephemeral medium, I can't attribute this remark to a particular speaker or even recall precisely what show was airing, but here are perhaps the pithiest words ever spoken about our nation's partisan disjuncture: "Republicans want to be rich and Democrats want to be right."

That nails it in one, doesn't it?

For some, personal gain is quite simply the highest value.  We on the other side find this hard to believe – but it's demonstrably clear that we'll never win an argument with them, by appealing to their better nature.  It isn't that they don't possess a better nature, but it's kept firmly in its place, restricted to benefiting kith, kin and self-aggrandizing philanthropies. The only occasions on which they've ceded any advantage on a broad basis have been when they'd effectively killed the Golden Goose, so we had to be revived and fattened up for a while. (Think Great Depression, for instance.)

By contrast, those of the greed contingent have grasped that the majority of people honestly place principle ahead of wealth.  That makes us suckers, in their book, and they've managed to play us like suckers by mincing it up – extolling a few token precepts to gain followers.  Mind you, these have no bearing on their all-important financial aims.  Trumpeting biblical strictures costs them nothing and fools believers into thinking they also buy into the rest of the doctrine (those icky parts about service to others, fairness, peace and the spiritual perils of privilege).  Likewise, it costs them nothing to bray about "the right to bear arms" and fools believers into thinking they also buy into the rest of the Constitution (those icky parts about governmental checks and balances, restrictions on war-mongering, even-handed justice and the primacy of individual freedom and conscience).

Thus, our would-be Masters of the Universe have exploited their fellow-citizens ideologically, as well as economically.  In high political circles, it's now considered bad form to point this out, but Barack Obama has been doing it – more gracefully when he spoke of our need to unite against the real enemy than when he spoke specifically of impoverished Americans clinging to God and Guns.  In each case, however, he was expressing essentially the same thought.  I'd like to see him broaden it to embrace these people as persons of principle, who were deliberately misled by being tossed a scrap of what they value.  There's a great affinity waiting to be tapped into, in that they placed something higher than their own pecuniary best-interest – which you'll never see a True Republican do.

9:20 AM - 5 Comments - 6 Kudos - Add Comment

Foreclosure Prevention Act Rewards Giant Homebuilders Complicit in Subprime Scam
Category: News and Politics

Not to be outdone by our scamming Wall Street bankers, our scamming builders have their hands out, too.  If the Foreclosure Prevention Act goes through as written, they’ll profit by as much as $33 billion in tax breaks, according to a new construction industry report: A Multi-Billion Bailout for Those at Fault: Corporate Homebuilders, the Housing Crash and the Mortgage Crisis, issued by LIUNA (the Laborers’ International Union of North America, which represents 10 million construction workers).

What the National Association of Home Builders’ lobbyists have slipped into legislation meant to help troubled homeowners is a "carry-back" provision allowing builders to apply their losses from 2006 and 2007 against taxes paid on profits as long ago as 2003.  This would give them a powerful incentive to dump unsold properties at prices that will further depress the housing market – in addition to billions in savings, at public expense and at a time when we can ill-afford lost revenue.

The builders also stand to benefit enormously from recent changes at Fannie Mae and Freddie Mac, permitting more loans and higher limits – another victory for the NAHB’s so-called "Build PAC", won in concert with lobbyists for the National Association of Realtors. These are the two largest business PACs in the nation and the builders have been pitching a fit lately.  In February, the NAHB angrily announced suspension of all political donations, until its demands were met.  Since the group doled out $3.5 million for the 2005-2006 election cycle, their sudden tight-fistedness was no doubt noticed.

Significantly, many homebuilders have cashed in on the mortgage trade, not just construction.  Their financial subsidiaries leapt onto the predatory lending bandwagon in a massive way and steadily escalated that aspect of the business.  In 2006, for instance, giants like KB Home, DH Horton, Lennar, Pulte and Shea generated from 60-400 percent more subprime loans than during the prior year (with little or no increase in prime loans).

And let’s remember that these guys made out like oilmen for ages – indeed, substantially better for a long while.  In September of 2005, financial analyst Jon Markman wrote, "Stocks of the country’s two largest home-builders, Pulte Homes and D.R. Horton are up 580% and 460% over the past five years, respectively, while shares of the two best-performing major international oil companies, Total and BP are up 101% and 47%."  By contrast, the broad market had then lost 20 percent of its value since September, 2000.

Yes, home sales are down now, but do you really think we need to worry about these huge corporations that fed so richly on the speculative housing bubble they helped inflate?

The president of LIUNA doesn’t.  Terence M. O’Sullivan stated, "This bill will force American taxpayers who are already struggling with foreclosure, job loss and shrinking retirement savings to pay again for homebuilders’ reckless and unethical behavior. Corporate homebuilders are tone deaf to even ask for it and Congress should not acquiesce to it. This bill needs to be fixed so it does not cause further damage by rewarding those who helped cause the crisis and who can well fend for themselves."

7:09 AM - 4 Comments - 2 Kudos - Add Comment

The Joke’s on Us, as Long as We Allow It
Category: News and Politics

As ever, mischief’s afoot on this April Fools’ Day. Did you get the e-mail from Code Pink saying John Conyers found a place on the table for impeachment, or maybe the one from The Daily Reckoning that features Bubbles Greenspan apologizing for the financial mess we’re in and a bevy of CEOs returning grillions in undeserved gains to their shareholders?

The gravity of those issues makes it far less fun to be fooled than when kids switch the sugar and salt or shriek, "There’s a bug on your head!"  About equally serious subjects, tricks are now being played IN DEAD EARNEST.  I speak of two in particular: a recent massing of US forces near Iran and The Paulson Plan.

With respect to the former, our media have grown so corrupt that it took news out of MOSCOW via the blogosphere to let Americans know about it.  (That the Russian press is now more reliable than ours is a separate story, horrific on its own.)

With respect to the latter, although views of foes are also cited, The New York Times today supplied dutiful quotes of endorsement for a proposal that even Treasury Secretary Henry Paulson has admitted was never meant to address our present economic troubles – although he managed with a straight face to claim we didn’t reach these gates of doom from want of regulation.  His plan (for distracting us from what honestly needs to be done) is recycled stuff, as Ian Welsh’s blog points out: a compendium of changes the Wall Street titans have long craved.  At the heart of it is a pitch to hand all oversight of our financial markets to private entities (the Fed, which is owned by the banks, and industry associations).  Quite a timely prank, if one favors heavily ironic humor.

This is like the film Groundhog Day, except it’s April Fools’ Day that keeps replaying.  And day after day, as we wake again and again to their foolery, we’re the butt of the joke.

Are we really going to let Shrub and Darth, our self-styled imperators, compound their foolishness in Iraq by doing exactly the same thing to Iran?

Are we really going to let Wall Street’s self-styled wizards compound the foolishness of securitizing housing debt – routinely raising the risk of millions into billions, on the chance of making a lucky guess – by doing exactly the same thing with convoluted derivative bets on further forms of debt and a myriad of other intangibles?  That’s what crafted the crisis we’re in and they’re gleefully repeating it every day on deals now related to alternate energy, bankruptcy paper and even the weather!

Let’s face it: We’re dealing with addicts, completely unprincipled slaves to greed and power.  How long before we make it clear that they can’t fool us anymore?

3:25 PM - 0 Comments - 0 Kudos - Add Comment

Have you fed your prisoners today?
Category: News and Politics

I write this at 2 a.m., jolted awake by the dream of finding prisoners in my home, in a locked room I'd forgotten.  Upon chancing to open it, perhaps while putting someone in there, I was stunned to see about half a dozen young men sitting forlornly on a cot.  They couldn't recall when they'd last eaten, although thankfully none appeared to be starving or unwell.  I left with the intention of making them omelets, yet aware that I might fail to do it.  With each step along the corridor outside, I kept telling myself to remember – and remember also to bring other meals, not only today but tomorrow.  The prospect seemed so terribly difficult that I wondered how soon I'd forget them again.

This nightmare, obviously prompted by recent news that prisons now hold one American out of every 100, is all too true.  They're OUR prisoners: captives in OUR home, forgotten by those of us who don't see them.  We've actually seen far more of the foreigners held elsewhere in our name, whom Shrub the Head Thug believes he has some God-given right to torture. 

Yes, supposedly we dream all the time, but frankly I doubt it in my case.  I've had no example to report for the nearly two years since writing:

"You know things have gone way too far when Shrub invades your dreams. I don't have many, but there he was on Saturday night, armed and unbelievably dangerous.  While asleep in my bed and simultaneously standing in the corridor of what looked like an English country house hotel, I watched him blast five or six people at point-blank range.  Smirking and certain to get away with it. 

'Even this,' I thought at the time – as if his gunning down a handful of imaginary guests at their imaginary doors were somehow worse than Shrub's public crimes.  I don't recall feeling threatened, myself, but it wasn't in the manner of the old epics, in which a bard is always 'saved for the song's sake.'  It was because his power to spin the story rendered me not only irrelevant but invisible, or perhaps mildly amusing.  This, I see on reflection, is what Shrub and His Thugs have done to us all.  Even though a majority of us now oppose them, we don't count ... "

That nightmare remains all too true, too.  We're merely inmates on longer leashes, "free" to pay endlessly for our captors' wars, jails and economic abuses.

Unreasoning fear lies behind it all.  Reagan first played on this with his "law and order" number, the pretext for building a police state to protect the new robber barons who've preyed increasingly on the rest of us for decades.

A really good first step toward recovering our sanity and strength as citizens would be to demand release of all non-violent criminals.  Among the millions in our prisons, most are kids who did nothing much wrong.  By letting them out of our collective basement to get on with their lives, we'd shed an insupportable moral burden and also free a fortune for wiser uses.

2:39 AM - 5 Comments - 2 Kudos - Add Comment

Horrible Heather Shrugs Off Vote-Buying Scam
Category: News and Politics

While my focus is generally on issues of national or international interest, those who read here regularly may recall that the Congressperson attached to my patch in ABQ is the horrible Heather Wilson, protégé of Senator Pete Domenici –- both involved in Prosecutor-Gate (their target among the Honest Eight being David Iglesias).  Supremely Loyal Bushies, they've never met a purveyor of dirty or otherwise dangerous energy whom they didn't love on sight, or at least at the sight of the checkbook.

Mind you, Heather nearly lost last November and Pete, besides being ancient, would rather retire than be driven from office, so my present topic is essentially a tiny, internecine matter.  Both posts will most likely be filled by Democrats in the future.  However, what Heather is now up to stinks a LOT and serves to underscore the whole fuck-you-very-much attitude of neocons.  The plan afoot is for her to fill the shoes Pete will at last kick off this autumn, and for the present county sheriff (so far, a little-known bully called Darren White) to fill hers.  Their shoe-horn, to extend the metaphor, was HIRING delegates to vote for Wilson and White at the recent Republican nominating convention.

A extremely cool old dude has called them on it!  He's former New Mexico Governor David Cargo (so former a governor that I was in high school in another state, when he was first elected and I'm past 50 now).  Dave Cargo dates from an era when Republicans weren't what they are today.  He's even honest.  Appalled when it became transparently clear (by their own admission) that many attendees at the delegate convention in his ward had been paid to show up and vote for the Wilson/White axis over others contending for nomination, he later spoke with Heather about the abuse – and then went into something close to a shit-fit, when her only response was a SHRUG.

"It was bizarre.  If someone had said that about me, that I was buying votes, I'd have gone through the roof! But she just looked at me and shrugged," Cargo told BradBlog, which has entered the fray on behalf of a veteran radio journalist who tried reporting the affair, with quotes from Cargo, and soon had her stories killed by the Citadel-owned station, whereupon she resigned in an understandable huff.

New Mexico's Attorney General and Secretary of State are conducting investigations now, which seems only fair.

I've boiled the tale down, but you can read loads more, if you want to.  Start at BradBlog or f-brilliant and then follow links and your nose.  In the second piece, by the reporter, there's a goosepimply bit about the sheriff's bully-boys threatening other NM Republicans (including ice-skater Brian Boitano's bro).

Normally I wouldn't bother posting something like this, but am doing so largely in tribute to a much older friend -- long dead -- who was, although progressive in his own views and the host of an incendiary talk show, so close to Dave Cargo that he was offered any gig in Cargo's second administration and duly given charge of the silly Governor's Prayer Breakfast that opens each legislative session in January.  Bruce was an atheist -- I don't know about Cargo -- and took delight in subverting the event by doing things like inviting me (at 25, a fledgling ad/PR person and journalist) and seating me next to the venerable Robert O. Anderson.  I'll never forget that morning -- or the gala on the night before, where I first met Patsy Madrid, who almost smashed Heather last November.  New Mexico was a WAY different place in those days: so small and intermingled a world that the vile Pete had been the college roommate of a guy who was the best friend of a guy who became one of my exes.

Blessings on you, Bruce Hansen, and on Dave Cargo for appreciating you then and for calling Heather on this travesty now.

5:52 PM - 0 Comments - 2 Kudos - Add Comment

A Valediction for the Prince of Sophists (William F. Buckley, Jr. 1925-2008)
Category: News and Politics

"A mind," as the saying goes, "is a terrible thing to waste."  Damn shame about Bill Buckley's.  Imagine the good he might have done, given worthier aims than enlarging fortunes like his family's, reviving social restrictions that even his Catholic church considered shopworn by the 1960s and generally stopping the march of history dead in its tracks.

Even at 16, my age when The Firing Line debuted in 1966, I knew his politics were repugnant.  Besides defending the increasingly bloody American misadventure in Vietnam and, of course, anything big business and theocrats wanted, he was a foe of the civil rights movement and similarly held that students were too uppity.  By then, the world had seen only a few campus sit-ins and minor disruptions, but even this was too much for Buckley, who thought the root of the problem was simply lack of adult discipline.  On one of his earliest shows, the actor and folk singer Theodore Bikel countered, "Do you really think we live in... an age where... a parent can obstinately cling to the belief that the values of today are not substantially different from the values of yesterday?"  "But the parents are right," Buckley retorted, to which Bikel laughed, "I knew that you would say that."

There was seldom a scrap of doubt about what he'd say on any subject.  The fun part was how cleverly he often said it.  In both the elegance of his demeanor and his choice of words – selected with evident gusto from one of the best-furnished toyboxes around – he'd have been at home in a Noel Coward play, with only a few famous lapses (as when he threatened to punch Gore Vidal for calling him a crypto-fascist).

I'd love to know what Vidal is thinking today, having now outlived the last of his three sparring partners, the others being Truman Capote and Norman Mailer.  It was a delight to observe their verbal pummelings – all well within bounds of civility, compared to today's lying, strident body-slams.

Of course the Fairness Doctrine still applied in those days.  Nobody got away with outright falsehood, besides which television wasn't yet a bastion of anti-intellectualism.  It actually brought us live theatre throughout my childhood; Burton played Hamlet in our living rooms and the hosts of talk shows were almost uniformly erudite, the likes of Steve Allen and Dick Cavett.

Buckley set out to match or exceed their class, at a time when conservatism had no such spokesman and, in seeking to legitimize the Robber Barons' perspective, he presented his opposing views gracefully alongside those of people whom we honestly wanted to watch (John Kenneth Galbraith, David Susskind, Dick Gregory, Hugh Hefner, David Merrick, Dore Schary, Pierre Salinger, Daniel Moynihan, anti-Vietnam activist David Dellinger, James Hoffa, the then-young Senator Al Gore and even Black Panther Huey Newton and counterculture stars Timothy Leary and Allen Ginsberg). Have a look at some of these program summaries. Only occasionally was his guest a fellow-Republican, until the later years, so this was a brilliant means of worming into wider consciousness, without seeming to be a public menace.

Among those who've done our country such vast damage, Buckley was certainly one of the most influential, but not one of the absolute worst.  The New Republic was higher-toned before his 1990 retirement, and he had sense enough to favor decriminalizing drugs and to admit failure in Iraq and want us out in 2006.

If we get do-overs, I hope next time he'll be just as smart and amusing, but on the people's side.

1:15 PM - 2 Comments - 4 Kudos - Add Comment