Daily Archive: 03/22/2013

Mar 22 2013

NCAA Men’s Basketball Tournament 2013: Day 4 Late Evening

A surfeit of games.

Time Network Seed Team Record Seed Team Record Region
9 TBS (7) San Diego State 22-10 (10) Oklahoma 20-11 South
9:30 CBS (7) Notre Dame 25-9 (10) Iowa State 22-11 West
9:30 TNT (1) Kansas 29-5 (16) Western Kentucky 20-15 South
9:30 True (6) UCLA 25-9 (11) Minnesota 20-12 South

Mar 22 2013

Cyprus: No Good Deed Goes Unpunished

Up Date 3.23.2013 0100 AM EDT: The Cyprus Parliament has passed part of a bailout plan but has delayed voting on a tax for unsecured deposits:

One of the provisions Parliament approved Friday would impose new restrictions on withdrawing cash or moving money out of the country when the banks reopen. These new capital controls would prohibit or restrict check-cashing and bar “premature” account closings or any other transaction the authorities deemed unwarranted.

Lawmakers also voted to restructure the nation’s largest and most troubled bank, Laiki Bank, by splitting off its troubled assets into a so-called bad bank. Accounts with no problem would be transferred to the nation’s largest financial institution, the Bank of Cyprus. Lawmakers also voted to require that any bank on the verge of bankruptcy be split apart in the same way. [..]

Still to be voted on is the measure to impose a tax of 22 to 25 percent on uninsured deposits at the Bank of Cyprus. That proposal was made after lawmakers rejected a plan earlier in the week to tax insured deposits to help raise the amount needed to secure the bailout. The Parliament appears to be trying to make up the difference in part by shifting the burden to large account holders.

Cyprus Finance Minister Michael Sarris returned empty handed from Russia after the Russians ruled  out helping until after a deal is struck with European Union. Yesterday, German Chancellor Angela Merkel rejected the proposal to nationalize pension funds and insisting that depositors, especially large savings accounts, be taxed to raise the needed €5.8 billion of the €10 billion bailout deal. Part of the reason for the refusal to accept nationalization of pensions as part of the deal is that Germany did just that to finance both world wars. Germans also face an election in six months and have been reluctant to give up on the bank levy since it protects them from accusations of using European taxpayers money to bail out big Russian investors in Cyprus.

In a nut shell, Cyprus got into this mess because the country’s banks were using Russian deposits to buy Greek bonds to help forestall the collapse of the Greek banks. The Greek bonds went bad, and the Cypriot banks lost a bundle. No good deed goes unpunished.

So where is Cyprus now? At this time, the Parliament is going over a series of bills that would consolidate its ailing banks and the creation of a fund that pools state and church assets, i.e. real estate and pensions, against which they would issue bonds. The deputy leader of he ruling Democratic Rally party, Averof Neophytou, cleared the way for the reconsideration of tax levy on savings accounts which had been flatly reject ted on Tuesday.

The other monkey wrench in all of this is Turkey’s challenge of the any move by Cyprus to speed up offshore natural gas exploration as a way of attracting desperately needed investment to save the economy.  

“This resource belongs to two communities and the future of this resource can’t be subject to the will of southern Cyprus alone. (We) may act against such initiatives if necessary,” one of the Turkish officials told Reuters.

“The exclusive use of this resource … by Southern Cyprus is out of question … and unacceptable.”

Cyprus has been divided between the Greek Cypriot south and Turkish north since a Greek coup d’etat followed by a Turkish army invasion in 1974. Efforts to reunite the island have repeatedly failed and Turkey is the only nation to recognise the self-declared Turkish Republic of Northern Cyprus.

At the Washington Post‘s “Wonkblog”, Dylan Matthews predicted two possible scenarios if Cyprus accepts the EU bailout terms:

What’s the best case scenario from a bailout?

The best we can hope for is that Cyprus takes the hit, gets some money, recapitalizes its banks, and recovers from there. It had a fairly conservative banking sector before the crisis, with deposits far outstripping loans, and its government was actually running surpluses, so it doesn’t have to engage in the kinds of fundamental structural reforms that appear necessary in Greece. So if the Greek losses were just a temporary shock, the rescue money should get the country back on its feet.

And the worst-case scenario?

The worst-case scenario under a plan with a haircut is that the plan triggers a run on banks not just in Cyprus (that appears to already be happening) but in other vulnerable countries like Spain and Italy as customers worry that the E.U. will try to impose similar conditions there. That would exacerbate an already bad situation as it would increase bank shortfalls; fewer deposits, after all, mean a worse deposit-to-liability ratio. Those kinds of runs could lead to a continent-wide crisis of the kind observers have been fearing since the euro zone started its slow-motion collapse back in 2009.

However, the failure of the initial haircut plan renders this outcome less likely. It does render a Cypriot exit from the monetary union quite a bit more likely. That would trigger bank runs in Cyprus as people try to get their money out before the Cypriot pound falls dramatically in value relative to the Euro, and could trigger further runs in Spain and Italy. That’s bad for the same reason haircut-inspired bank runs are bad.

Truthfully, it’s all bad and there is no reason for this since as Ezra Klein points out that the solution is to just give Cyprus the money:

Seriously. €15.8 billion ($20.5 billion) is not a lot of money in the scheme of European finance. It is trivially easy for the European Central Bank, or the IMF, or the Federal Reserve, or really any central bank of any consequence to just hand it over. That the troika is already committing €10 billion ($13 billion) is evidence enough. All the troubles in the negotiations are linked to the demand that €5.8 billion ($7.5 billion) come from Cyprus’ own coffers. Dropping that requirement could solve everything.

The Germans will never allow that until they are in the same boat. This is also why the euro will eventually fail.  

Mar 22 2013

NCAA Men’s Basketball Tournament 2013: Day 4 Early Evening

A plethora of games.

Time Network Seed Team Record Seed Team Record Region
6:30 TBS (2) Georgetown 25-6 (15) Florida Gulf Coast 24-10 South
7 CBS (2) Ohio State 26-7 (15) Iona 20 – 13 West
7 TNT (8) North Carolina 24-10 (9) Villanova 20-13 South
7 True (3) Florida 26-7 (14) Northwestern State 23-8 South

Mar 22 2013

NCAA Men’s Basketball Tournament 2013: Day 4 Late Afternoon

Games 5 through 8.

Time Network Seed Team Record Seed Team Record Region
2:30 CBS (7) Creighton 27-7 (10) Cincinnati 22-11 Midwest
3 True (4) Kansas State 27-7 (13) La Salle 21-9 West
4 TBS (1) Indiana 27-6 (16) James Madison 21-14 East
4:30 TNT (7) Illinois 22-12 (10) Colorado 21-11 East

Mar 22 2013

Punting the Pundits

“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Punting the Pundits”.

Follow us on Twitter @StarsHollowGzt

Paul Krugman: Treasure Island Trauma

A couple of years ago, the journalist Nicholas Shaxson published a fascinating, chilling book titled “Treasure Islands,” which explained how international tax havens – which are also, as the author pointed out, “secrecy jurisdictions” where many rules don’t apply – undermine economies around the world. Not only do they bleed revenues from cash-strapped governments and enable corruption; they distort the flow of capital, helping to feed ever-bigger financial crises. [..]

So, about Cyprus: You might wonder why anyone cares about a tiny nation with an economy not much bigger than that of metropolitan Scranton, Pa. Cyprus is, however, a member of the euro zone, so events there could trigger contagion (for example, bank runs) in larger nations. And there’s something else: While the Cypriot economy may be tiny, it’s a surprisingly large financial player, with a banking sector four or five times as big as you might expect given the size of its economy.

Mary L. Dudziak: Obama’s Nixonian Precedent

ON March 17, 1969, President Richard M. Nixon began a secret bombing campaign in Cambodia, sending B-52 bombers over the border from South Vietnam. This episode, largely buried in history, resurfaced recently in an unexpected place: the Obama administration’s “white paper” justifying targeted killings of Americans suspected of involvement in terrorism.

President Obama is reportedly considering moving control of the drone program from the Central Intelligence Agency to the Defense Department, as questions about the program’s legality continue to be asked. But this shift would do nothing to confer legitimacy to the drone strikes. The legitimacy problem comes from the secrecy itself – not which entity secretly does the killing. Secrecy has been used to hide presidential overreach – as the Cambodia example shows.

Robert Kuttner: Cyprus: The Mouse that Roared

The Cyprus banking crisis presents, in microcosm, everything that is perverse about the European leaders’ response to the continuing financial collapse. And bravo to the Cypriot Parliament for rejecting the EU’s insane demand to condition a bank bailout on a large tax on small depositors.

If this crisis threatens to spread to other nations, it’s a good object lesson. Here is the punch line of this column: Its time for Europe’s small nations, who are getting slammed into permanent depression by the arrogance of Berlin and Brussels, to think about abandoning the euro. At least the threat would strengthen their bargaining position, and if they actually quit the euro, the result could hardly be worse than their permanent sentence to debtors’ prison.

Elizabeth Holtzman: Statutes of Limitations Are Expiring on Some Bush Crimes

Americans have been facing a number of momentous deadlines, including the expiration of the Bush tax cuts and the “sequester” of $1 trillion from federal programs. But another critical deadline is fast approaching without attracting much notice. Statutes of limitations applicable to possible crimes committed by former President George W. Bush and his top aides, with respect to wiretapping of Americans without court approval and to fraud in launching and continuing the Iraq War, may expire in early 2014, less than a year from now.

President Bush has publicly admitted to authorizing wiretaps of Americans on more than thirty separate occasions without a court order, an apparent violation of the Foreign Intelligence Surveillance Act (FISA). In justification, Bush claimed legal advice exempted him as commander-in-chief from obeying FISA. Normally, a lawyer’s advice is not a defense to prosecution, particularly when the client shapes the advice. Here, the White House worked closely with Justice Department lawyer John Yoo on the legal opinion and blocked standard Justice Department review, even though the opinion was seriously flawed according to Yoo’s successors. The opinion bears the hallmarks of a handy stay-out-of-jail card, instead of a serious independent analysis prepared and relied upon in good faith.

Robert Reich: Selling the Store: Why Democrats Shouldn’t Put Social Security and Medicare on the Table

Prominent Democrats — including the President and House Minority Leader Nancy Pelosi — are openly suggesting that Medicare be means-tested and Social Security payments be reduced by applying a lower adjustment for inflation.

This is even before they’ve started budget negotiations with Republicans — who still refuse to raise taxes on the rich, close tax loopholes the rich depend on (such as hedge-fund and private-equity managers’ “carried interest”), increase capital gains taxes on the wealthy, cap their tax deductions, or tax financial transactions.

It’s not the first time Democrats have led with a compromise, but these particular pre-concessions are especially unwise.

John Buell: Combating US Capitalism’s Moral Blinders

US capitalism is not merely a set of institutions that include large corporate ownership of the means of production, concentrated product markets, unregulated finance, and “flexible” labor markets, and corporate-advertiser-financed media. It is also an ethic, a set of moral sensibilities regarding profits and wealth. Whereas both were once regarded as signs of one’s social contributions, they have become ends in themselves.

Anything that maximizes profits-and often even for the CEO alone-is regarded as fair game. And except in cases where the wealthy have swindled other wealthy citizens, the megarich are treated with deference or at least kid gloves. Thus Bernie Madoff does go to jail, but authors and abettors of other ponzi schemes like Jamie Dimon remain honored guests on CNBC.

Mar 22 2013

NCAA Men’s Basketball Tournament 2013: Day 4 Early Afternoon

It never stops.  It just never stops.

Sixteen more games today.

Time Network Seed Team Record Seed Team Record Region
noon CBS (2) Duke 25-4 (15) Albany 24-10 Midwest
12:30 True (5) Wisconsin 23-11 (12) Mississippi 26-8 West
1:30 TBS (8) NC State 24-10 (9) Temple 23-9 East
2 TNT (2) Miami 27-6 (15) Pacific 22-12 East

Mar 22 2013

On This Day In History March 22

This is your morning Open Thread. Pour your favorite beverage and review the past and comment on the future.

Find the past “On This Day in History” here.

March 22 is the 81st day of the year (82nd in leap years) in the Gregorian calendar. There are 284 days remaining until the end of the year.

On this day in 1784, the Emerald Buddha is moved with great ceremony to its current place in Wat Phra Kaew, Thailand.

The Emerald Buddha is the palladium of the Kingdom of Thailand, a figurine of the sitting Buddha, made of green jadeite (rather than emerald), clothed in gold, and about 45 cm tall. It is kept in the Temple of the Emerald Buddha (Wat Phra Kaew) on the grounds of the Grand Palace in Bangkok.

According to the legend, the Emerald Buddha was created in India in 43 BC by Nagasena in the city of Pataliputra (today’s Patna). The legends state that after remaining in Pataliputra for three hundred years, it was taken to Sri Lanka to save it from a civil war. In 457, King Anuruth of Burma sent a mission to Ceylon to ask for Buddhist scriptures and the Emerald Buddha, in order to support Buddhism in his country. These requests were granted, but the ship lost its way in a storm during the return voyage and landed in Cambodia. When the Thais captured Angkor Wat in 1432 (following the ravage of the bubonic plague), the Emerald Buddha was taken to Ayutthaya, Kamphaeng Phet, Laos and finally Chiang Rai, where the ruler of the city hid it. Cambodian historians recorded capture of the Buddha statue in their famous Preah Ko Preah Keo legend. However, some art historians describe the Emerald Buddha as belonging to the Chiang Saen Style of the 15th Century AD, which would mean it is actually of Lannathai origin.

Historical sources indicate that the statue surfaced in northern Thailand in the Lannathai kingdom in 1434. One account of its discovery tells that lightning struck a pagoda in a temple in Chiang Rai, after which, something became visible beneath the stucco. The Buddha was dug out, and the people believed the figurine to be made of emerald, hence its name. King Sam Fang Kaen of Lannathai wanted it in his capital, Chiang Mai, but the elephant carrying it insisted, on three separate occasions, on going instead to Lampang. This was taken as a divine sign and the Emerald Buddha stayed in Lampang until 1468, when it was finally moved to Chiang Mai, where it was kept at Wat Chedi Luang.

The Emerald Buddha remained in Chiang Mai until 1552, when it was taken to Luang Prabang, then the capital of the Lao kingdom of Lan Xang. Some years earlier, the crown prince of Lan Xang, Setthathirath, had been invited to occupy the vacant throne of Lannathai. However, Prince Setthathirath also became king of Lan Xang when his father, Photisarath, died. He returned home, taking the revered Buddha figure with him. In 1564, King Setthathirath moved it to his new capital at Vientiane.

In 1779, the Thai General Chao Phraya Chakri put down an insurrection, captured Vientiane and returned the Emerald Buddha to Siam, taking it with him to Thonburi. After he became King Rama I of Thailand, he moved the Emerald Buddha with great ceremony to its current home in Wat Phra Kaew on March 22, 1784. It is now kept in the main building of the temple, the Ubosoth.

Mar 22 2013

CIA Drones War Shift To Pentagon

Earlier this week it was leaked to the press by those “anonymous White House sources” that the CIA’s drone program would be gradually transferred to the Pentagon supposedly making oversight by Congress more transparent and according to Daniel Klaidman, who first reported the shift at the Daily Beast it would also toughen the “criteria for drone” strikes and “strengthen the program’s accountability:”

Currently, the government maintains parallel drone programs, one housed in the CIA and the other run by the Department of Defense. The proposed plan would unify the command and control structure of targeted killings and create a uniform set of rules and procedures. The CIA would maintain a role, but the military would have operational control over targeting. Lethal missions would take place under Title 10 of the U.S. Code, which governs military operations, rather than Title 50, which sets out the legal authorities for intelligence activities and covert operations. [..]

Officials anticipate a phased-in transition in which the CIA’s drone operations would be gradually shifted over to the military, a process that could take as little as a year. Others say it might take longer but would occur during President Obama’s second term. [..]

uring that time, CIA and DOD operators would begin to work more closely together to ensure a smooth hand-off. The CIA would remain involved in lethal targeting, at least on the intelligence side, but would not actually control the unmanned aerial vehicles. Officials told The Daily Beast that a potential downside of the agency’s relinquishing control of the program was the loss of a decade of expertise that the CIA has developed since it has been prosecuting its war in Pakistan and beyond. At least for a period of transition, CIA operators would likely work alongside their military counterparts to target suspected terrorists.

Spencer Ackerman at The Wire, doesn’t think that this is much of a change. The CIA will still be involved telling military personnel what and who to target. Nor does Ackerman think that the program will be more transparent:

The congressional reporting requirements for so-called Title 50 programs (stuff CIA does, to be reductive) are more specific than those for Title 10 (stuff the military does, to be reductive). But the armed services committees tend to have unquestioned and broader oversight functions than the intelligence committees enjoy, not to mention better relationships with the committees: Witness the recent anger in the Senate intelligence committee that the CIA lied to it about its torture programs. The military is more likely than the CIA to openly testify about future drone operations, allow knowledgeable congressional staff into closed-door operational briefings and allow members of Congress to take tours of drone airbases.

As, Klaidman pointed out this could lead to even less transparency since there is nothing in the law that requires the military to account for its lethal operations while the CIA is obligated to report its activities.

Sen. Diane Feinstein (D-CA), the chair of the Senate Intelligence Committee which has oversight of the CIA, expressed her concerns

Feinstein told reporters her “mind, certainly, is not made up.” But she quickly added she has reservations about turning over to the military the CIA’s armed drone fleet and the missions they conduct.

   During the last few years, she said, “We’ve watched the intelligence aspect of the drone program: how they function. The quality of the intelligence. Watching the agency exercise patience and discretion,” Feinstein said.

   “The military [armed drone] program has not done that nearly as well,” she said. “That causes me concern. This is a discipline that is learned, that is carried out without infractions…. It’s not a hasty decision that’s made. And I would really have to be convinced that the military would carry it out that way.”

Sen. John McCain (R-AZ) preferred the program be transferred to Defense bringing it under the House and Senate Armed Services Committees:

“I believe the majority of the responsibility for this should rest with the military,” McCain told reporters Tuesday. [..]

“The majority of it can be conducted by the Department of Defense,” McCain said. “It’s not the job of the Central Intelligence Agency. … It’s the military’s job.”

Transferring the program to the Pentagon — and under the auspices of the House and Senate Armed Services committees — would create more “openness” and “oversight” and public hearings about the program, he said.

In reality, the Obama administration would still be running a secretive and questionably legal program.

Rachel Maddow, host of MSNBC’s “The Rachel Maddow Show,” gives a a short history of the CIA and talks with former congressman and now MSNBC contributor, Patrick Murphy, who served on the House Armed Services Committee, about oversight of the drone program.

Mar 22 2013

NCAA Men’s Basketball Tournament 2013: Day 3 Late Evening

Even More Games!

9 TBS (8) Colorado State 25-8 (9) Missouri 23-10
9:30 CBS (5) VCU 26-8 (12) Akron 26-6
9:30 TNT (3) New Mexico 29-5 (14) Harvard 19-9
9:30 True (4) Syracuse 26-9 (13) Montana 25-6