Daily Archive: 07/18/2013

Jul 18 2013

Say it ain’t so Joe

Republicans, White House in Talks Toward Big Fiscal Deal

By Chris Frates, National Journal

July 17, 2013 6:42 p.m.

This fall, the country will hit its debt limit and be unable to pay its bills unless Congress authorizes additional borrowing. Republicans plan to use the debate over raising the debt limit to force Democrats to cut spending-a negotiation Obama has said he won’t engage in. But these meetings demonstrate that the president is in fact engaging Republicans in a broader discussion about debt and spending.



An administration official said White House aides have made clear to Republicans that the president’s offer from December-including $600 billion in new tax revenue for $400 billion in Medicare and other health care cuts-still stands.

Republicans are open to $600 billion in revenue, Burr said, but want to see it come from a mix of entitlement and tax reform. And the GOP opposes Obama’s $400 billion in Medicare cuts, arguing they want more structural reforms.

Repeat after me-

There is no budget deficit.  Austerity does.  not.  work.  You can’t cut your way to growth.

(h/t Susie Madrak @ Crooks & Liars)

Jul 18 2013

The Good Bank

Chase, Once Considered "The Good Bank," Is About to Pay Another Massive Settlement

By Matt Taibbi, Rolling Stone

July 18, 12:20 PM ET

In the three-year period between 2009-2012, Chase paid out over $16 billion in litigation costs. Noted financial analyst Josh Rosner of Graham Fisher slammed Chase in a report earlier this year, pointing out that these settlements and legal costs represented a staggering 12% of Chase’s net revenue during this time. There couldn’t possibly be a clearer demonstration of the modern banking model, in which companies break rules/laws as a matter of course, and simply pay fines as a cost – a significant cost – of doing business.

For sheer curiosity’s sake, I thought I’d list, in capsule form, some of the capers Chase has been caught up in in recent years:

  • They were fined $153 million for the infamous “Magnetar” fund case, another scam in which a bank allowed a hedge fund to create a “born-to-lose” mortgage portfolio to bet against. Very similar to the Abacus case that’s at the heart of the ongoing “Fabulous Fab” trial;
  • Chase paid $228 million for its role in the egregious municipal bond bid-rigging case we wrote about in Rolling Stone in 2011;
  • Chase paid $297 million to the SEC last November for fraud involving mortgage-backed securities;
  • Chase paid $75 million in cash and generously agreed to forego $647 million in fines in the Jefferson County, Alabama mess, in which a small-town pol was bribed into green-lighting a series of deadly swap deals;
  • In two separate orders this spring, Chase was reprimanded by the OCC and the Fed for money-laundering behaviors similar to the infamous HSBC case, and also for regulatory failures and fraud in the London Whale episode. There was a separate FBI investigation into the London Whale probe in which they allegedly lied to customers and investors about the loss;
  • They’re under investigation for allegedly failing to disclose Bernie Madoff’s trading activities to authorities;
  • They were one of 13 banks asked to pay up in this year’s $9.3 billion robosigning settlement;
  • They were one of four banks last year to settle for a total of $394 million with the OCC for improper mortgage servicing practices;
  • They were ordered by the CFTC to pay $20 million last year for improper segregation of customer funds (this was part of the Lehman investigation). The CFTC also fined Chase $600,000 last year for violating position limits in the cotton markets;
  • Last year, Chase paid a $45 million settlement to the federal government for improperly racking up fees for veterans in mortgage refinancings. Hey, if you’re going to steal from everyone, you can’t leave out those veterans overseas!
  • In 2010, Chase paid $25 million to the state of Florida for selling unregistered bonds to a state-run municipal money-market fund;
  • The bank last year was convicted in Europe along with several other banks for fraudulent sales of derivatives to the city of Milan. A total of about $120 million was seized from Chase and three other banks.



There are some other civil actions left out, too, like the $110 million class-action settlement for improper charging of overdraft fees, or their part in the gigantic $6 billion settlement completed last year involving Visa, MasterCard and other credit card providers for manipulating card service rates. And states like California have only just begun crawling up Chase’s backside for its role in the lunatic filing of erroneous credit card collection lawsuits, a scam outed by whistleblower Linda Almonte.

Chase is turning into the Zelig of the corruption era.

Speaking of Credit Cards-

Chase Made Errors in Nine Percent of Credit-Card Collection Lawsuits, Internal Survey Finds

By Matt Taibbi, Rolling Stone

July 11, 12:05 PM ET

Thirteen states, as well as the Office of the Comptroller of the Currency, a primary banking regulator, are investigating Chase’s insanely sloppy practices in the area of credit-card collections. I’ve been following this for years thanks to an acquaintance with former Chase VP and whistleblower Linda Almonte, who saw horrific abuses firsthand (I have a chapter on Linda’s crazy experiences coming out in my next book).



I’m glad that the states are finally listening to Linda and that this news is starting to come out. The story is actually far worse than is being described in the papers. It involves allegations of a rather complicated scam tied to secondary sales of credit-card debt – it’s easier to sell credit card debt when a judgment has already been obtained, so it seems companies like Chase will go to great lengths, including mass robosigning and other abuses, to obtain judgments.

Chase is the headline target of these new investigations, but most analysts believe the same exact things go on at other banks and credit companies. Once the bigger state lawsuits gain momentum, we’re likely to find out, as we did in the foreclosure scandals, that faulty paperwork and perjured/robosigned affidavits pervade the entire consumer debt industry.

Jul 18 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

Nasser al-Awlaki: The Drone That Killed My Grandson

I LEARNED that my 16-year-old grandson, Abdulrahman – a United States citizen – had been killed by an American drone strike from news reports the morning after he died.

The missile killed him, his teenage cousin and at least five other civilians on Oct. 14, 2011, while the boys were eating dinner at an open-air restaurant in southern Yemen. [..]

Nearly two years later, I still have no answers. The United States government has refused to explain why Abdulrahman was killed. It was not until May of this year that the Obama administration, in a supposed effort to be more transparent, publicly acknowledged what the world already knew – that it was responsible for his death.  [..]

After the deaths of Abdulrahman and Anwar, I filed another lawsuit, seeking answers and accountability. The government has argued once again that its targeted killing program is beyond the reach of the courts. I find it hard to believe that this can be legal in a constitutional democracy based on a system of checks and balances.

The government has killed a 16-year-old American boy. Shouldn’t it at least have to explain why?

New York Times Editorial Board: A Second Chance for the World’s Disabled

There was a painful moment on Capitol Hill in December when former Senator Bob Dole, seated in a wheelchair, was greeted warmly by old Republican colleagues but then rebuffed by some of those very same members after he had urged Senate ratification of a United Nations treaty defending the rights of people with disabilities. The treaty drew a 61-to-38 vote that fell five votes short of the needed two-thirds majority after skittish Republicans bought into a nonsensical attack by right-wing critics that it would undermine national sovereignty.

Senator Robert Menendez, a New Jersey Democrat and the chairman of the Senate Foreign Relations Committee, is now negotiating with the ranking committee Republican, Bob Corker of Tennessee, to arrange another vote. Should Mr. Corker agree, it is essential that Senate Democrats vote as one to approve the treaty and that Republicans rise above the hackneyed politicking that undermined the vote last year. With the social-issue pandering of the 2012 campaign behind us, the treaty can be seen for what it is: a singular opportunity to apply the principles of the highly effective Americans With Disabilities Act to the world at large.

Richard (RJ) Eskow: The “Filibuster” Fight Was Really About Our Core Values — And It’s Not Over

A deal over the “filibuster” was tentatively reached in the Senate today, but forget all the insider talk about “nuclear options” and “recess appointments.” This isn’t a story about process. It’s a story about ideology – specifically, the radical-right extremism of today’s Republican Party.

It’s also a story about paralysis, the corrupting power of money in politics, and the real reasons why Washington is increasingly failing to serve the people.

The wasn’t a filibuster fight. It was a fight over fundamental principles of democracy and the role of government in society.

And it’s not over.

Jessica Berstein: Whatever Happened to MoveOn.Org? Progressives and NSA Spying

Ever since the Edward Snowden story about the NSA spying program erupted, there has been a disturbingly eerie silence from progressives. Yes, perfunctory articles have been written, the usual pundits have spoken, and the ACLU has filed a much needed lawsuit, but progressive action groups have scarcely eked out a handful of petitions. As we are facing what is arguably one of the greatest historic struggles of our time, there is barely a ripple in the progressive universe.

Many progressives believe they do not have much to worry about because they ‘haven’t done anything wrong,’ and ‘have nothing to hide.’ However, knowledge of the vast surveillance program should raise critical questions about what is actually being done with this information. Heidi Boghosian, executive director of the National Lawyer’s Guild, explains that one of the first things the government does is target the individuals who are challenging either its policies or the corporate power structure. Evidence of such targets is mounting. Environmental activists and animal rights activists were labeled the top domestic terrorism threat in 2005. The brutal tactics used to suppress the Occupy movement should have given serious pause to activists on all fronts.

Robert Reich: Why We Should Stop Subsidizing Sky-High CEO Pay

Almost everyone knows CEO pay is out of control. It surged 16 percent at big companies last year, and the typical CEO raked in $15.1 million, according to the New York Times.

Meanwhile, the median wage continued to drop, adjusted for inflation.

What’s less well-known is that you and I and other taxpayers are subsidizing this sky-high executive compensation. That’s because corporations deduct it from their income taxes, causing the rest of us to pay more in taxes to make up the difference.

This tax subsidy to corporate executives from the rest of us ought to be one of the first tax expenditures to go, when and if congress turns to reforming the tax code.

Jim Hightower: Exceptionally Mediocre on a Global Scale

America became great through deliberate and determined public investments in the common good, not hocus-pocus exceptionalism.

America the Beautiful! America the Greatest! We’re No. 1, right?

Absolutely, naturally, and indisputably. At least that’s the theocratic pronouncement of far-right-wing nativists who preach the dogma of American “exceptionalism.” They use the concept as a not-to-be-questioned litmus test of our patriotism.

Never mind that on many crucial measures of national achievements, our Good Ol’ U.S. of A has slipped in recent years. A simple-minded assertion that we’re No. 1 doesn’t make it so.

Jul 18 2013

On This Day In History July 18

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.

Click on images to enlarge

July 18 is the 199th day of the year (200th in leap years) in the Gregorian calendar. There are 166 days remaining until the end of the year.

On this day in 1940, Franklin Delano Roosevelt, who first took office in 1933 as America’s 32nd president, is nominated for an unprecedented third term. Roosevelt, a Democrat, would eventually be elected to a record four terms in office, the only U.S. president to serve more than two terms.

Roosevelt was born January 30, 1882, in Hyde Park, New York, and went on to serve as a New York state senator from 1911 to 1913, assistant secretary of the Navy from 1913 to 1920 and governor of New York from 1929 to 1932. In 1932, he defeated incumbent Herbert Hoover to be elected president for the first time. During his first term, Roosevelt enacted his New Deal social programs, which were aimed at lifting America out of the Great Depression. In 1936, he won his second term in office by defeating Kansas governor Alf Landon in a landslide.

Election of 1940

The two-term tradition had been an unwritten rule (until the 22nd Amendment after his presidency) since George Washington declined to run for a third term in 1796, and both Ulysses S. Grant and Theodore Roosevelt were attacked for trying to obtain a third non-consecutive term. FDR systematically undercut prominent Democrats who were angling for the nomination, including two cabinet members, Secretary of State Cordell Hull and James Farley, Roosevelt’s campaign manager in 1932 and 1936, Postmaster General and Democratic Party chairman. Roosevelt moved the convention to Chicago where he had strong support from the city machine (which controlled the auditorium sound system). At the convention the opposition was poorly organized but Farley had packed the galleries. Roosevelt sent a message saying that he would not run, unless he was drafted, and that the delegates were free to vote for anyone. The delegates were stunned; then the loudspeaker screamed “We want Roosevelt… The world wants Roosevelt!” The delegates went wild and he was nominated by 946 to 147 on the first ballot. The tactic employed by Roosevelt was not entirely successful, as his goal had been to be drafted by acclamation. The new vice presidential nominee was Henry A. Wallace, a liberal intellectual who was Secretary of Agriculture.

In his campaign against Republican Wendell Willkie, Roosevelt stressed both his proven leadership experience and his intention to do everything possible to keep the United States out of war. In one of his speeches he declared to potential recruits that “you boys are not going to be sent into any foreign war.” He won the 1940 election with 55% of the popular vote and 38 of the 48 states. A shift to the left within the Administration was shown by the naming of Henry A. Wallace as Vice President in place of the conservative Texan John Nance Garner, who had become a bitter enemy of Roosevelt after 1937.

Jul 18 2013

Le Tour 2013: Stage 18

It’s been a while since I’ve tuned into Le Tour, partly because of computer woes (my main drive was deteriorating invisibly, except for the slowness that made it positively painfull to compose).  It is I suppose no great loss except for those who are fans of the scenic countryside the race winds through, and it is spectacular.

The race itself has gone to form which has left me feeling the same ennui and diffidence I do when Vettel gets an early lead and disappears.  You are left hoping for a game changer, something that will put a contender within striking distance and force the favorite to do something other than coast to victory.

Well, if that’s going to happen, it will happen today.

The reason is the course and the conditions.  Today is the double ascent of Alpe-d’Huez and the descent after the Col de Sarenne.  In addition to the two beyond category ascents there are 3 category 2 and a category 3 climb.  Now this in itself is not much of an obstacle to Chris Froome, the maillot jaune, who has out climbed his nearest rivals time and again.

Nope, it will be the descents, especially given the heavy overnight rain and the dampness expected at altitude.

You don’t like to hope for a crash, but it’s a good way to modify the time picture which at this point is entirely unfavorable to any rivals with only 2 riders less than 5 minutes back and merely 2 more under 7.

General Classification

Rank Name Team Time
1 FROOME Christopher SKY PROCYCLING 66h 07′ 09”
2 CONTADOR Alberto TEAM SAXO-TINKOFF + 04′ 34”
3 KREUZIGER Roman TEAM SAXO-TINKOFF + 04′ 51”
4 MOLLEMA Bauke BELKIN PRO CYCLING + 06′ 23”
5 QUINTANA ROJAS Nairo Alexander MOVISTAR TEAM + 06′ 58”
6 RODRIGUEZ OLIVER Joaquin KATUSHA TEAM + 07′ 21”
7 TEN DAM Laurens BELKIN PRO CYCLING + 08′ 23”
8 FUGLSANG Jakob ASTANA PRO TEAM + 08′ 56”

They finish this year’s Tour with 2 more Alpine stages after today before the grand procession to the Champs-Élysées so things could still change if Froome breaks down physically or something else unexpected happens.

In Sprint (Points, Green Jersey) competition things are looking equally set in stone with Peter Sagan almost 100 points ahead and only 8 riders over 100 ponts at all.

Points

Rank Name Team Points
1 SAGAN Peter CANNONDALE 377
2 CAVENDISH Mark OMEGA PHARMA-QUICK STEP 278
3 GREIPEL André LOTTO-BELISOL 223
4 KITTEL Marcel TEAM ARGOS-SHIMANO 177
5 KRISTOFF Alexander KATUSHA TEAM 157
6 ROJAS José Joaquin MOVISTAR TEAM 145
7 KWIATKOWSKI Michal OMEGA PHARMA-QUICK STEP 110
8 FLECHA GIANNONI Juan Antonio VACANSOLEIL-DCM 110

If you like handicapping backmarkers there is a race for Second between Mark Cavendish and André Greipel.

For King of the Mountains (Climber, Polka Dot Jersey) as you would expect Chris Froome has a commanding lead and Alberto Contador is not even in the picture (25 points).  Only 4 riders have over 50 points.

King of the Moutains

Rank Name Team Points
1 FROOME Christopher SKY PROCYCLING 88
2 QUINTANA ROJAS Nairo Alexander MOVISTAR TEAM 69
3 NIEVE ITURRALDE Mikel EUSKALTEL – EUSKADI 53
4 ROLLAND Pierre TEAM EUROPCAR 51

In the Team Competition Sky (Chris Froome’s team) is a surprising 11th, over 1:15 behind.  Also, as you can see, there’s a lot of racing left in the top 6.

Team

Rank Team Time
1 TEAM SAXO-TINKOFF 198h 58′ 43”
2 RADIOSHACK LEOPARD + 01′ 22”
3 AG2R LA MONDIALE + 08′ 14”
4 MOVISTAR TEAM + 12′ 48”
5 BELKIN PRO CYCLING + 22′ 33”
6 KATUSHA TEAM + 30′ 58”

Youth (White Jersey) is a hard category for me to get behind, I think it a poor substitute for amature.  Still, there is no denying Nairo Alexander Quitana Rojas has had an outstanding Tour, sitting at 5th in the GC and 2nd in King of the Mountains.

Young Rider

Rank Name Team Time
1 QUINTANA ROJAS Nairo Alexander MOVISTAR TEAM 66h 56′ 09”
2 KWIATKOWSKI Michal OMEGA PHARMA-QUICK STEP + 04′ 12”
3 TALANSKY Andrew GARMIN – SHARP + 08′ 15”
4 BARDET Romain AG2R LA MONDIALE + 21′ 45”

Sites of Interest-

The Stars Hollow Gazette Tags-

Jul 18 2013

Pravda on the Potomac

One of the many provisions of the National Defense Authorization Act of 2013 that was signed by Pres. Barack Obama late in the night of December 30, 2012, was the repeal of the Smith-Mundt Act of 1948. The original act outlined the State Department’s dissemination of information outside the boarders of the United States:

authorizes the U.S. State Department to communicate to audiences outside of the borders of the United States through broadcasting, face-to-face contacts, exchanges (including educational, cultural, and technical), online activities, the publishing of books, magazines, and other media of communication and engagement.

The legislation included three key provision the first, and most important was a prohibition on domestic dissemination of materials intended for foreign audiences by the State Department.

Section 501(a) of the Act (care of the Voice of America website) provides that

   “information produced by VOA for audiences outside the United States shall not be disseminated within the United States … but, on request, shall be available in the English language at VOA, at all reasonable times following its release as information abroad, for examination only by representatives of United States press associations, newspapers, magazines, radio systems, and stations, and by research students and scholars, and, on request, shall be made available for examination only to Members of Congress.”

“This means that VOA is forbidden to broadcast within the United States.” In reality, of course, any American with a shortwave receiver or an Internet connection can listen to VOA. That’s incidental, however. VOA cannot direct or intend its programs to be “for” Americans. This distinction is often lost on experts who see the letter of the law but with no real understanding of the media. George W. Bush-era State Department official James K. Glassman has called for directing VOA at American audiences.

The 2013 NDAA ended that restriction on July 2:

(T)he Broadcasting Board of Governors (BBG) was given permission to let US households tune-in to hear the type of programming that has previously only been allowed in outside nations.

The BBG is the independent government agency that broadcasts Voice of America, Radio Free Europe, and other networks created “to inform, engage and connect people around the world in support of freedom and democracy” – and a new law now allows the agency to provide members of the American public with program materials originally meant to be disseminated abroad.

Back in 1972, Arkansas Senator J. William Fulbright equated those government stories with propaganda when he said they “should be given the opportunity to take their rightful place in the graveyard of Cold War relics.” A couple of current lawmakers were singing a different tune when they proposed the Smith-Mundt Modernization Act of 2012 last year, though, which became official just two weeks ago.

Reps. Mac Thornberry (R-TX) and Adam Smith (D-WA), who introduced the changes to the Smith Mundt last year argued

“Effective strategic communication and public diplomacy should be front-and-center as we work to roll back al-Qaeda’s and other violent extremists’ influence among disaffected opulations,” [..]

An essential part of our efforts must be a coordinated, comprehensive, adequately resourced plan to counter their radical messages and undermine their recruitment abilities. To do this, Smith-Mundt must be updated to bolster our strategic communications and public diplomacy capacity on all fronts and mediums – especially online.

According to Tim Cushing at Techdirt, there is the good news and bad news of the government’s ability to aim its pre-approved news at US citizens. The “good new”:

BBG spokesperson Lynne Weil says these efforts aren’t simply pro-government hype machines.  [..]

As Weil points out, this will bring a new level of transparency to the BBG as communicating to Americans is no longer prohibited. If nothing else, transcripts of BBG programming will be easier for Americans to get ahold of. A court ruled in 1998 that the limitations of the Smith-Mundt Act exempted the Voice of America from releasing transcripts in response to FOIA requests.

Another possible plus is the fact that the BBG will provide a free, “local” news source for immigrant populations. [..]

However, there is the “bad news”:

(T)he thought of a state-run news agency being allowed to direct its efforts at Americans is still uncomfortable. Despite claims of independence, it’s hard to believe the source is 100% trustworthy when its stated purpose is to run flack for the State Department in foreign nations. (Of course, the mainstream media outlets haven’t shown much reluctance to regurgitate talking points, which almost makes the BBG’s efforts seem redundant.)

While the BBG may provide a less-biased source of news for many foreigners (or at least provide a different bias), the purpose of its broadcasts to its new American audience is less clear. The fact that the State Department is behind the effort doesn’t do much to allay fears that the BBG will become a tool of domestic propaganda. The State Department’s reaction to the leak of diplomatic correspondence by Wikileaks was to block its employees’ access to the site (or any site containing the word “Wikileaks”) and demand the digital documents be “returned.” How will a state-run press react to developments like these? Will it be forced to play by the department’s rules, no matter how illogical, or will it be able to deal with them in a more forthright manner?

In a time where the administration seems to be forced to play defense with increasing frequency, it’s hard to believe it won’t be willing to exploit this addition to its PR arsenal.

In a May 18, 2012 BuzzFeded article, the late Michael Hastings warned that this revision would open the door to Pentagon propaganda:

The evaporation of Smith-Mundt and other provisions to safeguard U.S. citizens against government propaganda campaigns is part of a larger trend within the diplomatic and military establishment.

In December, the Pentagon used software to monitor the Twitter debate over Bradley Manning’s pre-trial hearing; another program being developed by the Pentagon would design software to create “sock puppets” on social media outlets; and, last year, General William Caldwell, deployed an information operations team under his command that had been trained in psychological operations to influence visiting American politicians to Kabul.

A U.S. Army whistleblower, Lieutenant Col. Daniel Davis, noted recently in his scathing 84-page unclassified report on Afghanistan that there remains a strong desire within the defense establishment “to enable Public Affairs officers to influence American public opinion when they deem it necessary to “protect a key friendly center of gravity, to wit US national will,” he wrote, quoting a well-regarded general.

Not only is the government creating an state approved press, it will now have its own news agencies within the US to disseminate its own sanctioned news stories, a true Pravda on the Potomac.