A Call to Action

Chris Hedges (author of  the great book, War is a Force that Gives Us Meaning) wrote this about our current political landscape:

Either we begin to militantly stand against the coal, oil and natural gas industry or we do not. Either we defy pre-emptive war and occupation or we do not. Either we demand that the criminal class on Wall Street be held accountable for the theft of billions of dollars from small shareholders whose savings for retirement or college were wiped out or we do not. Either we defend basic civil liberties, including habeas corpus and the prosecution of torturers or we do not. Either we turn on liberal institutions, including the Democratic Party, which collaborate with these corporations or we do not. Either we accept that the age of political compromise is dead, that the corporate systems of power are instruments of death that can be fought only by physical acts of resistance or we do not. If the liberal class remains gullible and weak, if it continues to speak to itself and others in meaningless platitudes, it will remain as responsible for our enslavement as those it pompously denounces. 

(This echoes a sentiment I’ve seen in many progressive circles:  it is futile  to engage Republicans politically on any issue; the only solution is to vote them out of office or at an individual level to boycott those companies and organizations which provide support for them).

Mark Shields on the lunacies of Arizona gun laws:

In Arizona, in order to cut toenails and fingernails, and to shampoo another person’s hair for profit, you must first undergo a background check and obtain a license from the State Board of Cosmetology.

To operate as a massage therapist in Arizona, you must, by state law, have had a minimum of 500 hours of instruction from a school recognized by the secretary of the Department of Education.

Before you can legally qualify as a pest-control applicator, you must undergo and pass a state-mandated background check.

Arizona requires a state license to sell minnows or other live bait. The Arizona Board of Athletic Training will decide whether you are qualified to be an athletic trainer. If your life’s ambition is to intern as a cremationist, you must win the approval of the Arizona Board of Funeral Directors and Embalmers. Hope to become an Aquatic Animal Processor, cleaning aquatic animals? Not until the Arizona Department of Agriculture approves and licenses your application.

It’s entirely possible that all of this licensing and permits and paperwork are needed to protect the public health and safety of the good people of Arizona.

But please tell me why to buy a Glock 9 mm pistol, modified with a high-capacity magazine to fire 31 rounds, Jared Lee Loughner, an obviously troubled and alienated young man, had to undergo no background check at all.

I’m pretty horrified by the news that Judge Thomas didn’t disclose his wife’s income source for working as a conservative lobbyist. Perhaps it was an error of omission, but remember that the Citizens United case was a 5-4 case and if Thomas had recused himself (because his wife received substantial sums from corporate donations), the case would not have gone the way it did.

Jonathan Schwartz explains why TARP was insignificant compared to how much the  Federal Reserve spent to rescue the commercial paper market.

This WAS a real, frightening problem. No commercial paper market, and Wal-Mart can’t pay for everything being delivered to its stores. Big grocery chains can’t pay for food. And no one is paying their workers. The entire economy could grind to a halt, and no one knew how hard it would be to start it again.

But there’s one thing Bernanke and Paulson left out, and that all the people talking about on TV didn’t know: there was no need for congress to pass a bill to save the commercial paper market, because the Fed could buy it directly. We know this because the Fed DID buy giant amounts of it, over $300 billion — but not until October, well after TARP had passed.

So in September, Bernanke was saying: "Help! We need $700 billion or else the commercial paper market will destroy the world!"

Then a month later in October, Bernanke quietly went ahead and saved the commercial paper market, using non-TARP money — something he could have easily done the month before.

This can all be seen in the above graph that I made. The Fed balance sheet exploded starting in mid-September. They spent $500 billion by October 1st, two days before TARP passed. They spent $1 trillion by the time the first trickles of TARP money were allocated in late October. (This in itself is damning — we had to give them the money or else Planet Earth would explode, and yet it took Paulson three weeks to dole out the first TARP sliver.) All along, the Fed side of the bailout had dwarfed TARP.

Yet it’s been completely invisible. While we were all screaming about that little pink line, the Fed was carrying out the real bailout via the blue line and we never noticed.

A chart sheds light on this: image

(More here). This way too macro for me to concern my little head about. I’m too worried about just making ends meet.   But loftier minds should be giving such items intense scrutiny. 

More locally, the way Texas is dealing with its budget deficit is scary. Houston ISD mentions the possibility of having to reduce its budget by 15-20%. (That’s the likely scenario; the failure of the state to take action to increase revenue will cause school districts to increase taxes, thereby giving governor Rick Perry someone to blame). Ponder this for a moment:

Texas, which crafts a budget every two years, was facing a $6.6 billion shortfall for its 2010-2011 fiscal years. It plugged nearly all of that deficit with $6.4 billion in Recovery Act money, allowing it to leave its $9.1 billion rainy day fund untouched.

One Chronicle blogger has given a name for the phenomena for starving government: the Perry Spiral:

Call it ‘The Perry Spiral’ – a terrible cycle in which further budget cuts just create new needs which cannot be met which lead to more budget cuts, which create new needs which cannot be met, which…you get the idea.

You could cut the quality of government to such an extreme that it begins to create new costs. It works like this. Say, in order to keep taxes low this year, you cut back food/housing aid to poor families with children, literacy programs, CHIPS, and school funding. You also eliminate any money being spent on health care for illegal aliens. Easy enough. Done. Maybe they’ll finally go back to Mexico.

Sustain that over time and you start seeing other costs surge up through the cracks. Counties experience ballooning emergency room expenses, eroding the quality of care at local hospitals. Demand for police and prison beds climbs. Graduation rates and the quality of the workforce decline.  And so on and so on in an ever-accelerating game of whack-a-mole.  The response to this new round of needs for prisons and schools and cops and hospital spending?  Cut some more. 

Sound familiar? 

You may continue to attract more new jobs because you’re a cheap place to do business, but an increasing percentage of those jobs are in low-wage, low-skill activities. Real estate is cheap, but for good reason. Cost of living is low, for the same reasons as the real estate.

On paper the economy looks pretty good, but median incomes begin to wobble. Why? Because it gets harder to attract or develop high-end jobs. A greater percentage of the most attractive jobs come to be located in places where the best employees would rather live; where their kids can go to good schools, enjoy a library, and not be surrounded by shanty-towns and strip-joints.

Robert Reich explodes the myths that public sector labor unions are blowing up budgets

The final Republican canard is that bargaining rights for public employees have caused state deficits to explode. In fact there’s no relationship between states whose employees have bargaining rights and states with big deficits. Some states that deny their employees bargaining rights – Nevada, North Carolina, and Arizona, for example, are running giant deficits of over 30 percent of spending. Many that give employees bargaining rights — Massachusetts, New Mexico, and Montana — have small deficits of less than 10 percent.

It’s only average workers – both in the public and the private sectors – who are being called upon to sacrifice.

This is what the current Republican attack on public-sector workers is really all about. Their version of class warfare is to pit private-sector workers against public servants. They’d rather set average working people against one another – comparing one group’s modest incomes and benefits with another group’s modest incomes and benefits – than have Americans see that the top 1 percent is now raking in a bigger share of national income than at any time since 1928, and paying at a lower tax rate. And Republicans would rather you didn’t know they want to cut taxes on the rich even more.






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