December 2012 archive

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.

December 19 is the 353rd day of the year (354th in leap years) in the Gregorian calendar. There are 12 days remaining until the end of the year.

On this day in 1776, Thomas Paine publishes The American Crisis.

These are the times that try men’s souls; the summer soldier and the sunshine patriot will, in this crisis, shrink from the service of his country; but he that stands it now, deserves the love and thanks of man and woman. Tyranny, like hell, is not easily conquered; yet we have this consolation with us, that the harder the conflict, the more glorious the triumph.

When these phrases appeared in the pages of the Pennsylvania Journal for the first time, General George Washington’s troops were encamped at McKonkey’s Ferry on the Delaware River opposite Trenton, New Jersey. In August, they had suffered humiliating defeats and lost New York City to British troops. Between September and December, 11,000 American volunteers gave up the fight and returned to their families. General Washington could foresee the destiny of a rebellion without an army if the rest of his men returned home when their service contracts expired on December 31. He knew that without an upswing in morale and a significant victory, the American Revolution would come to a swift and humiliating end.

Thomas Paine was similarly astute. His Common Sense was the clarion call that began the revolution. As Washington’s troops retreated from New York through New Jersey, Paine again rose to the challenge of literary warfare. With American Crisis, he delivered the words that would salvage the revolution.

The American Crisis was a series of pamphlets published from 1776 to 1783 during the American Revolution by eighteenth century Enlightenment philosopher and author Thomas Paine. Thirteen numbered pamphlets were published between 1776-1777 with three additional pamphlets released between 1777-1783. The writings were contemporaneous with the early parts of the American Revolution, during the times that colonists needed inspiring.

They were written in a language the common man could manage and are indicative of Paine’s liberal philosophies. Paine signed them with one of his many pseudonyms “Common Sense”. The writings bolstered the morale of the American colonists, appealed to the English people’s consideration of the war with America, clarified the issues at stake in the war and denounced the advocates of a negotiated peace.

As you know, if you read this blog, or any of the true left wing sites, like FiredogLake and Corrente, that Pres. Obama has once again gone back on his word that cuts to Social Security were off the table as a bargaining chip for a “Grand Bargain.” He has proposed to use  the chained CPI to calculate cost of living increases in Social Security benefits. Now House Minority Leader Nancy is saying that she could live with tying Social Security to the chained CPI, plus she said Democrats would stick with the president to avoid going over the fiscal cliff.

David Dayen at FDL News summed up Pelosi’s meaning and later White House Press Secretary Jay Carney said at the press briefing:

Pelosi tried to emphasize the unformed idea that there would be “protections” for the most vulnerable. For example, the disabled on Supplemental Security Income might not be subject to chained CPI, and there could be a “bump-up” for people aged 80, to compensate for the cumulative effect of the benefit cut. Again, the vulnerable are a massive part of this population (pdf). This is almost the entire income source for almost half of seniors, and for 3/4 of widows or unmarried women. And 15.1% of seniors live in poverty. And if you hold all of them harmless, you erode the actual savings you can derive from this. The three-legged stool of retirement has withered away, especially since the dot-com bust and the Great Recession. This argues strongly for increasing Social Security benefits, not cutting them and not even mitigating cuts.

White House Press Secretary Jay Carney called this a “technical fix” to better calculate inflation. Bullshit. If this were just a technical fix, you would adjust so that the fix wouldn’t hit beneficiaries in a regressive fashion, with the most pain at the bottom. This plan doesn’t, to any real degree. The goal isn’t to properly measure inflation, it’s to save money for the federal government. It always has been.

Well, it time to make noise and fight back. Atrios has sounded the alert and we should take to the phones:

White House

202-456-1111

Your senators

Your House member.

No cuts to Social Security.

Keep it up everyday, jam the lines until the President and Congress get the message:

“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”.

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Dean Baker: Michigan Republicans Deny Police Officers and Firefighters the Right to Work

That is what the headlines would say if anyone really believed that the anti-union laws passed last week in Michigan actually had anything to do with the rights of workers. When the legislature outlawed contracts requiring workers who benefit from union representation to pay for that representation, it explicitly exempted the police and firefighters’ unions. If this law was actually about the “right to work,” the Republican legislature and Governor Snyder were effectively denying the right to work to the state’s police officers and firefighters.

Of course this law has nothing to do with the right to work (RTW), as everyone involved knows; that is just the spin from the anti-labor coalition. This is why police unions and firefighters’ unions were exempted. The Republicans were trying to buy off these workers with special favors, not singling them out for punishment.

There is no issue of rights involved in this dispute. The question is whether workers, through their union, can sign a contract that imposes conditions on employment, just as the employer can impose conditions on employment.

New York Times Editorial: Reason to Hope After the Newtown Rampage

This is a country that has a history of facing tragedy and becoming better for it. It is a country that recoiled in horror at the Triangle shirtwaist factory and took steps to protect the lives of factory workers. It is a country able to rethink deeply seated beliefs – as it did with discrimination against blacks and women and is now doing with antigay discrimination. [..]

So we have found real reason to find hope in the determination to effect change that followed the murders of 20 children and seven adults in Newtown, Conn., last Friday. President Obama said it unequivocally on Sunday – the enormity of controlling the culture of guns and the epidemic of gun violence “can’t be an excuse for inaction.”

Yes, Mr. Obama has said that before, after two previous mass killings during his tenure, and did nothing. The hurdles are just as big as they were before, but there are signs that people are willing to rethink their views.

Pretty damn bad.

What Chained CPI Means, and Why a Cut in a Time of Inadequate Social Security Benefits Makes No Sense

By: David Dayen, Firedog Lake

Monday December 17, 2012 2:45 pm

Let’s just make clear what chained CPI is all about. The idea here is that you should not measure the cost of living simply based on the consumer price index, and then raise the costs accordingly with the rise in prices. Instead, economists say, you have to account for the substitution effect in response to price shifts. When someone cannot afford steak, maybe they buy more chicken, the theory goes. By “chaining” the CPI to account for the substitution effect, you’re really shrinking the inflation in the index, because you’re assuming that the individual will spend less by changing their lifestyle. As a result, cost of living adjustments based on a chained CPI will rise more slowly that COLAs based on an unchained one.

…

(T)he idea of chaining medical treatment, as if you can just substitute a hip replacement with something cheaper, is silly. Overtreatment does exist, but the concept of a senior citizen shopping for cheaper medical care is actually kind of cruel.

Shifting to CPI-E would actually reflect the real costs of seniors, and would have their cost of living adjustment keep up with their actual needs. But of course, that’s not the goal of public policymaking. It’s to “save money,” in this case at the expense of the elderly, particularly those over the age of 80.

Chained CPI only makes sense if you think Social Security benefits and the cost of living adjustment are currently adequate enough for seniors. The fact that 15.1% of seniors are in poverty, according to the newest measure, shows that this is not at all the case. We need higher, not lower, Social Security benefits, as retirement security outside of the program withers. But adequacy is not the goal of those who want to slash benefits. And Democratic enablers call it something they can “live with.” Obviously none of them are 80 or older.

Obama’s Latest Fiscal Slope Offer: I’m Missing the Part Where Republicans Give Up Something

By: David Dayen, Firedog Lake

Tuesday December 18, 2012 6:00 am

From where I’m standing, this is a deal for the President to break his promise on tax rates, allow half of the fiscal slope to go forward, probably cut as much as 2% from GDP in 2013, and enact permanent benefit cuts to Social Security (and other government benefits) as well as unspecified cuts to health care programs, in exchange for…

1. a routine extension of unemployment insurance;
2. no more than $50 billion in infrastructure, probably less;
3. a permanent extension of things Congress does annually like clockwork (making them permanent is good public policy, but doesn’t functionally change much);
4. the chance to do this again in two years.

Meanwhile, Republicans give up tax rates that were going up anyway, an unemployment extension that they have yet to fail to pass, and a bit of infrastructure. That’s it, in exchange for cuts that will put discretionary spending well below traditional levels, cut Social Security benefits and basically ensure smaller government through caps and cuts.

More on Chained CPI, the Benefit Cut for Social Security on the Table in Fiscal Slope Discussions

By: David Dayen, Firedog Lake

Tuesday December 18, 2012 6:45 am

First of all, this is a benefit cut of about 0.3% a year, as Dean Baker points out. He adds that “This loss would be cumulative through time so that after 10 years the cut would be roughly 3 percent, after 20 years 6 percent, and after 30 years 9 percent.” Actually if we started using chained CPI in 2002, we’d be 3.6% behind today. That’s well over $1,000 a year, and the situation grows worse over time. So the greatest impact would be on the oldest seniors, which happens to correlate with the poorest.

If you think that senior citizens have had it too good for too long, getting that sweet sweet cost of living adjustment to make them unfairly wealthy, then maybe you think chained CPI is a solid idea. If you think that the highest expense for a senior is medical costs, that seniors don’t exactly comparison shop when they need medical care, that they cannot substitute along those lines, and that a cost of living index that features that substitution effect prominently doesn’t correspond to the real costs seniors face, well, you would be right.

…

(A)s supporter of a Social Security deal Kevin Drum says, adopting chained CPI for Social Security by itself is a terrible deal. Even if all of the savings from it get plowed back into reducing the long-term income gap, it doesn’t do enough by itself to eliminate that. It reduces the trust fund gap by about 1/3. Which means that fiscal scolds would still be clamoring for a deal to “fix” Social Security, and the fact that the solutions were entirely on the benefit side this time around won’t matter. This is just an invitation to more cuts down the road.

Paul Krugman tries to rationalize and bargain and basically gives a lifeline to cutting these benefits, at a time when senior poverty is on the rise. Ask yourself: are Social Security benefits, which average around $13,000 a year, currently adequate to serve this population, especially when 40% of seniors rely on it for over 90% of their income? Is the solution to 15.1% of seniors in poverty to cut their benefits slowly over time? Should the centerpiece of a deal to reduce the budget contain a benefit cut to a program that has its own dedicated funding stream and no budgetary impact?

UPDATE: First, Krugman has a new post up, saying he is now “marginally negative” on the deal after being “marginally positive.” He ignores the $800 billion in extra budget cuts in the deal.

Also, if anything I undersold the impact of chained CPI, since it would affect federal employee benefits that are tied to COLA, like postal workers.

Here is what Atrios (trained economist BTW) says-

To The Phones

White House

202-456-1111

Your senators

Your House member.

No cuts to Social Security.

Gaius Publius @ Americablog offers this helpful digest-

What are we protecting?

We’re protecting three social insurance programs. These are:

    ■ Social Security

    ■ Medicare

    ■ Medicaid

What are we protecting them from? Anything that:

    ■ Reduces benefits

    ■ Turns the program from insurance to welfare (which only the “deserving” have access to)

How are these programs being threatened?

As near as I can tell, these are the threats. Note to foxes – this is the hands-off list. Each of these seven items is a benefit cut:

Social Security

    1. Raising the retirement age

    2. Chained CPI instead of current COLA

    3. Means-testing benefits

Medicare

    4. Raising the eligibility age

    5. Increasing Part B premiums

    6. Increasing “cost-sharing”

Medicaid

    7. Shifting costs to the states by any means, such as “federal blended rate,” etc.

Serious People Could be Seriously Embarrassed: Why It’s Important that We Not Go Off the "Fiscal Cliff"

Dean Baker, CEPR

Friday, 14 December 2012 09:51

Much of the media has spent the last month and a half hyping the impact of the “fiscal cliff,” the tax increases and spending cuts that are scheduled to take effect at the end of the year. They have been warning of a recession and other dire consequences if a deal is not struck by December 31st. As we are now getting down to the final two weeks and the prospect that there will not be a deal becomes more likely, many in the media are getting more frantic.

What they fear is yet another huge embarrassment, if people see the deadline come and go and the economy doesn’t crash and the world doesn’t end.

…

In other words, if January 1, 2013 comes and there is no deal, we will likely see that the Serious People were again out to lunch. This will be yet another blow to the credibility of the people who are telling us that we have to cut Social Security and Medicare and do all sorts of other things that somehow always seem to have the effect of hurting the poor and middle class.

Of course many may say that the Serious People have recovered from past humiliations. After all, how long did it take them to get over the fact that not one of them was able to see the $8 trillion housing bubble whose collapse wrecked the economy? And there can be little doubt that they will quickly rewrite the history so that none of them was actually issuing the dire warnings we keep hearing about the fiscal cliff.

But some people will remember, and there will always be people rude enough to bring up past mistakes. So the Serious People really do have a lot at stake here. If we go past January 1 and there is no deal, they will be very unhappy.

Crafting a boom economy

By: Jim VandeHei and Mike Allen, Politico

December 11, 2012 04:35 AM EST

What is striking, though, is that if you put everyone from President Barack Obama and Senate Majority Whip Dick Durbin to House Speaker John Boehner and Portman on truth serum, they basically agree: Washington could set the economy on a very safe course, if not on fire, through a half-dozen policies that are not partisan.

The country’s most influential CEOs, who have been meeting with Obama and congressional leaders on these very topics, are telling them if they do some or all of this, investment, market growth and jobs will quickly follow.

Bank of America CEO Brian Moynihan said long-term commitments to measures such as tax reform and trade would provide a “certainty premium” that would help bring corporate cash off the sidelines. “If we can just allow people to keep their confidence up by getting some of these issues off the table,” he said, “you would see the economy grow and momentum continue to build, and unemployment continue to ease down, and housing starts [go] up and housing prices [go] up. All that will continue to build on itself.”

…

Officials largely agree Congress should cut domestic spending, including a nice chunk out of defense, because the budget is bloated, outdated and often designed to placate specific lawmakers or defense contractors. But it will take entitlement changes, which both sides say are inevitable, to get U.S. debt levels where they need to be, which in turn plays into investment into everything from U.S. companies to Treasury bills.

“The critical problem is entitlement reform, and if taxes even have to go up to get an entitlement deal done, that still solves the vast majority of the issue,” said Kenneth Griffin, who founded Citadel LLC, a hedge fund, and is worth an estimated $3 billion. He is a Republican.

Nearly every lawmaker and staffer will tell you privately that they know the Social Security retirement age needs to go up, the rate of growth of benefits needs to be slowed on a sliding scale that protects the poor, the cap on income subjected to the tax that finances the program needs to rise and the rich should get smaller or no payout from the program.

They will also tell you Medicare, which is on pace to be insolvent in 12 years, is a much, much bigger mess and threat to long-term economic vitality – and much harder to solve. Yes, the rich need to get smaller benefits, but that is almost meaningless in terms of fixing it. Ultimately, many Americans will have to get less generous benefits that start to kick in at an older age – and those changes need to start a decade from now. Otherwise, the math simply doesn’t work.

Delusions of Wisdom

Paul Krugman, The New York Times

December 11, 2012, 3:33 pm

In said (above) piece they talk to various Very Serious People, and divine the insider consensus on What Must Be Done – which mainly seems to involve, naturally, cutting Social Security and Medicare while reducing corporate tax rates.

What I find remarkable about this piece is that after everything that has happened these past five years or so, Jim VandeHei and Mike Allen still take it for granted that these people actually know what they’re talking about; the whole premise of the article is that the insiders really do have the key, not just to good policy, but to achieving a dramatic rise in the growth rate.

Now, they don’t tell us everyone they talked to; but I think we can safely assume that, with few exceptions, the insiders in question:

• Believed that financial deregulation was a great idea, because bankers had really learned to manage risk
• Did not believe that there was a housing bubble
• Insisted that budget deficits, even in a depressed economy, would send interest rates soaring any day now
• Insisted that austerity measures would promote recovery, not hurt it, because of the confidence fairy

…

The whole theme of the Politico piece is that great things would happen if only the insiders could override all this messy democracy stuff. But the real lesson is that those insiders are not only self-dealing, but profoundly ignorant and wrong-headed. It’s too bad that so many journalists still can’t see that.

Why is Washington Obsessing About the Deficit and Not Jobs and Wages?

Robert Reich

Thursday, December 13, 2012

So why are we debating how to cut the deficit when we should be debating how best to use the cheap money we can borrow from the rest of the world to put more Americans to work?

Because too many Democrats inside and outside the Beltway have ingested the deficit cool-aide that the “serious people” on Wall Street have serving for two decades.

And the President has been all too willing to legitimize their deficit obsession by freezing federal salaries, appointing a deficit commission, and, now that the election is over, going back to deficit-speak.

A month after the election Obama was on Bloomberg Television saying business leaders need “a deal on long-term deficit reduction” before they’ll increase hiring.

That’s just not true. Before they’ll increase hiring they need customers.

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.

December 18 is the 352nd day of the year (353rd in leap years) in the Gregorian calendar. There are 13 days remaining until the end of the year.

On this day in 1918, the House of Representatives passed the 18th Amendment to the Constitution, along with the Volstead Act, which defined “intoxicating liquors” excluding those used for religious purposes and sales throughout the U.S., established Prohibition in the United States. Its ratification was certified on January 16, 1919. It was repealed by the Twenty-first Amendment in 1933, the only instance of an amendment’s repeal. The Eighteenth Amendment was also unique in setting a time delay before it would take effect following ratification and in setting a time limit for its ratification by the states.

Section 1. After one year from the ratification of this article the manufacture, sale, or transportation of intoxicating liquors within, the importation thereof into, or the exportation thereof from the United States and all territory subject to the jurisdiction thereof for beverage purposes is hereby prohibited.

Section 2. The Congress and the several States shall have concurrent power to enforce this article by appropriate legislation.

Section 3. This article shall be inoperative unless it shall have been ratified as an amendment to the Constitution by the legislatures of the several States, as provided in the Constitution, within seven years from the date of the submission hereof to the States by the Congress.

The amendment and its enabling legislation did not ban the consumption of alcohol, but made it difficult to obtain it legally.

Following significant pressure on lawmakers from the temperance movement, the House of Representatives passed the amendment on December 18, 1917. It was certified as ratified on January 16, 1919, having been approved by 36 states. It went into effect one year after ratification, on January 17, 1920. Many state legislatures had already enacted statewide prohibition prior to the ratification of the Eighteenth Amendment.

When Congress submitted this amendment to the states for ratification, it was the first time a proposed amendment contained a provision setting a deadline for its ratification. The validity of that clause of the amendment was challenged and reached the Supreme Court, which upheld the constitutionality of such a deadline in Dillon v. Gloss (1921).

Because many Americans attempted to evade the restrictions of Prohibition, there was a considerable growth in violent and organized crime in the United States in response to public demand for illegal alcohol. The amendment was repealed by the Twenty-First Amendment on December 5, 1933. It remains the only constitutional amendment to be repealed in its entirety.

Democratic Hawaii Senator Daniel Inouye, age 88, has died from complications of a respiratory infection at Walter Reed National Military Medical Center in Washington, DC. Sen. Inouye has represented Hawaii in both the House and the Senate since it became a state in 1959. He was  the first Japanese-American to serve in the U.S. House of Representatives and later the first in the U.S. Senate. He was elected to the Senate in 1963.

At the time of his death, Sen. Inouye was the most senior senator and  the second longest serving U.S. Senator in history after Robert Byrd. As the most senior senator, he was chosen President pro tempore by the Senate, making him third in the presidential line of succession after the Vice President and the Speaker of the House of Representatives. That post now goes to Sen. Patrick Leahy (D-VT).

Sen. Inouye served in the army during WW2 from 1941 to 1947, first as a volunteer in the medical corps and later in the European theater. In 1945, during a battle in Italy with German troops, he was severely wounded but continued to lead his men in battle:

On April 21, 1945, Inouye was grievously wounded while leading an assault on a heavily-defended ridge near San Terenzo in Tuscany, Italy called Colle Musatello. The ridge served as a strongpoint along the strip of German fortifications known as the Gothic Line, which represented the last and most dogged line of German defensive works in Italy. As he led his platoon in a flanking maneuver, three German machine guns opened fire from covered positions just 40 yards away, pinning his men to the ground. Inouye stood up to attack and was shot in the stomach; ignoring his wound, he proceeded to attack and destroy the first machine gun nest with hand grenades and fire from his Thompson submachine gun. After being informed of the severity of his wound by his platoon sergeant, he refused treatment and rallied his men for an attack on the second machine gun position, which he also successfully destroyed before collapsing from blood loss.

As his squad distracted the third machine gunner, Inouye crawled toward the final bunker, eventually drawing within 10 yards. As he raised himself up and cocked his arm to throw his last grenade into the fighting position, a German inside fired a rifle grenade that struck him on the right elbow, severing most of his arm and leaving his own primed grenade reflexively “clenched in a fist that suddenly didn’t belong to me anymore”.[13] Inouye’s horrified soldiers moved to his aid, but he shouted for them to keep back out of fear his severed fist would involuntarily relax and drop the grenade. As the German inside the bunker reloaded his rifle, Inouye pried the live grenade from his useless right hand and transferred it to his left. As the German aimed his rifle to finish him off, Inouye tossed the grenade off-hand into the bunker and destroyed it. He stumbled to his feet and continued forward, silencing the last German resistance with a one-handed burst from his Thompson before being wounded in the leg and tumbling unconscious to the bottom of the ridge. When he awoke to see the concerned men of his platoon hovering over him, his only comment before being carried away was to gruffly order them to return to their positions, since, as he pointed out, “nobody called off the war!”

The remainder of Inouye’s mutilated right arm was later amputated at a field hospital without proper anesthesia, as he had been given too much morphine at an aid station and it was feared any more would lower his blood pressure enough to kill him.

Although Inouye had lost his right arm, he remained in the military until 1947 and was honorably discharged with the rank of captain. At the time of his leaving of the Army, he was a recipient of the Bronze Star Medal and the Purple Heart. Inouye was initially awarded the Distinguished Service Cross for his bravery in this action, with the award later being upgraded to the Medal of Honor by President Bill Clinton (alongside 19 other Nisei servicemen who served in the 442nd Regimental Combat Team and were believed to have been denied proper recognition of their bravery due to their race).

The senator had been hospitalized since the beginning of this month, fighting complications of a respiratory infection. Doctors were concerned about his blood oxygen levels.

His staff said that his last word was “Aloha.”

Sen. Inouye is  is survived by his wife, Irene, a son, Ken, and a granddaughter named Maggie. Inouye’s first wife, Margaret, died in 2006.

Shortly after the election, South Carolina’s junior senator and Tea Party hero, Jim DeMint announced his resignation to become the head of the right wing Washington based think tank, The Heritage Foundation. That left it to the Tea Party governor, Nikki Haley, to appoint someone to fill the remaining two years of DeMint’s senate term. Gov. Haley stated that she would not appoint a “place holder” but would look for a person who would be a viable candidate for a full term in 2014. Today the governor announced her decision, overlooking polling favorite and native son Stephen Colbert, appointing the African American freshman US Representative Tim Scott to the seat.

David Dayen at FDL News reports:

Scott becomes the first African-American Senator since Roland Burris left in 2010, and the first African-American representing the South in the Senate since Reconstruction (there have only been six other African-American Senators total in the history of the country). Gov. Haley made the announcement at the State House in Columbia a short while ago:

Mr. Scott, 47, offers a unique story and background, one that is in scant supply in the Republican Party right now. Raised by a single mother, he was, by his account, a lost child who struggled with school and with life until a Chick-fil-A franchise owner took him on as a protégé and schooled him in conservative principles.

“Coming from a single-parent household and almost flunking out of high school,” Mr. Scott said in 2010, during his bid for the House, “my hope is I will take that experience and help people bring out the best that they can be.”

As David notes, don’t let Mr. Scott’s background fool you and links to this article at Think Progress:

By Scott Keyes on Dec 17, 2012 at 9:46 am

Tim Scott is America’s newest senator today after getting tapped by South Carolina Gov. Nikki Haley (R) to fill the vacancy left by former Sen. Jim DeMint (R-SC). DeMint announced this month that he was leaving the Senate to head up the Heritage Foundation, an arch-conservative think tank in Washington DC.

Though DeMint left big, controversial shoes to fill for Republicans, few conservatives will be disappointed with Scott’s record. Elected to Congress just two years ago in the Tea Party wave, Scott has already garnered headlines for his plan to impeach President Obama, his legislation to cut off union members’ children from food stamps, and his defense of Big Oil.

Here’s a quick look at Scott’s record:

• Floated impeaching Obama over the debt ceiling. As the debt ceiling debate raged in the summer of 2011 because of the intransigence of Tea Party freshmen like Scott, the nation inched perilously close to defaulting on its obligations. One option discussed by some officials to avoid that scenario was for the president to assert that the debt ceiling itself was an unconstitutional infringement on the 14th Amendment. However, Tim Scott told a South Carolina Tea Party group that if Obama were to go this route, it would be an “impeachable act.”
• Proposed a bill to cut off food stamps for entire families if one member went on strike. One of the most anti-union members of Congress, Scott proposed a bill two months after entering Congress in 2011 to kick families off food stamps if one adult were participating in a strike. Scott’s legislation made no exception for children or other dependents.
• Wanted to spend an unlimited amount of money to display Ten Commandments outside county building. When Scott was on the Charleston County Council, one of his primary issues was displaying the Ten Commandments outside the Council building. According to the Augusta Chronicle, Scott said the display “would remind council members and speakers the moral absolutes they should follow.” When he was sued for violating the Constitution and a Circuit Judge’s orders, Scott was nonplussed: “Whatever it costs in the pursuit of this goal (of displaying the Commandments) is worth it.”
• Defended fairness of giving billions in subsidies to Big Oil. Scott and his Republican allies in Congress voted repeatedly last year to protect more than $50 billion in taxpayer subsidies for Big Oil corporations. When ThinkProgress asked Scott whether it was fair to do that, especially at a time when oil companies are earning tens of billions in profit every quarter, the Tea Party freshman defended the industry: “fair is a relative word,” said Scott.
• Helped slash South Carolina’s HIV/AIDS budget. As a state representative, Scott backed a proposal to cut the state’s entire HIV/AIDS budget, despite the fact that South Carolina ranks in the top-third of reported AIDS cases. The cuts were ultimately included in the state’s budget, impacting more than 2,000 HIV-positive South Carolinians who needed help paying for their medication.

If you thought that the Senate couldn’t possibly be any worse, oh my, were you wrong. Now more that ever, the Senate needs to reform filibuster.

Last summer it was revealed that one of the world’s largest banks based, HSBC, base in Britain, had been laundering billions of dollars for Mexican drug cartels and skirting US government bans against financial transactions with Iran and other countries that aid Al Qaeda and other terrorist groups. In a stunning move during a hearing before the  Senate Permanent Subcommittee on Investigations chief compliance officer, David Bagley, took the blame and resigned.

Last week the federal government and New York State announced a settlement with HSBC:

In a filing in Federal District Court in Brooklyn, federal prosecutors said the bank had agreed to enter into a deferred prosecution agreement and to forfeit $1.25 billion. The four-count criminal information filed in the court charged HSBC with failure to maintain an effective anti-money laundering program, to conduct due diligence on its foreign correspondent affiliates, and for violating sanctions and the Trading With the Enemy Act.

“HSBC is being held accountable for stunning failures of oversight – and worse – that led the bank to permit narcotics traffickers and others to launder hundreds of millions of dollars through HSBC subsidiaries, and to facilitate hundreds of millions more in transactions with sanctioned countries,” Lanny A. Breuer, the head of the Justice Department’s criminal division, said in a statement. [..]

HSBC, based in Britain, has also agreed to pay the Office of the Comptroller of the Currency, one of the bank’s central regulators, an additional $500 million as part of a civil penalty. The Federal Reserve will be paid a $165 million civil penalty. [..]

HSBC also entered into a deferred prosecution agreement with the Manhattan district attorney’s office. As part of that agreement, HSBC admitted that it violated New York State law.

Just like the mortgage and banking fraud that was uncovered during the financial crisis, there will be no criminal charges. The fines that were levied are tantamount to about five weeks of income for the bank. Contributing editor for the Rolling Stone, Matt Taibbi points out the outrageous incongruity of this settlement:

If you’ve ever been arrested on a drug charge, if you’ve ever spent even a day in jail for having a stem of marijuana in your pocket or “drug paraphernalia” in your gym bag, Assistant Attorney General and longtime Bill Clinton pal Lanny Breuer has a message for you: Bite me. [..]

The banks’ laundering transactions were so brazen that the NSA probably could have spotted them from space. Breuer admitted that drug dealers would sometimes come to HSBC’s Mexican branches and “deposit hundreds of thousands of dollars in cash, in a single day, into a single account, using boxes designed to fit the precise dimensions of the teller windows.”

This bears repeating: in order to more efficiently move as much illegal money as possible into the “legitimate” banking institution HSBC, drug dealers specifically designed boxes to fit through the bank’s teller windows. [..]

Though this was not stated explicitly, the government’s rationale in not pursuing criminal prosecutions against the bank was apparently rooted in concerns that putting executives from a “systemically important institution” in jail for drug laundering would threaten the stability of the financial system. The New York Times put it this way:

   Federal and state authorities have chosen not to indict HSBC, the London-based bank, on charges of vast and prolonged money laundering, for fear that criminal prosecution would topple the bank and, in the process, endanger the financial system. [..]

So there is absolutely no reason they couldn’t all face criminal penalties. That they are not being prosecuted is cowardice and pure corruption, nothing else. And by approving this settlement, Breuer removed the government’s moral authority to prosecute anyone for any other drug offense. Not that most people didn’t already know that the drug war is a joke, but this makes it official.

Apparently this settlement has garnered some bipartisan concerns from Senators Jeff Merkley (D-OR) and Charles Grassley. In separate statements released from their offices, they criticized the Justice Department for not sending a stronger message to the banking industry. Sen. Grassley said it best:

   The Department has not prosecuted a single employee of HSBC-no executives, no directors, no AML compliance staff members, no one. By allowing these individuals to walk away without any real punishment, the Department is declaring that crime actually does pay. Functionally, HSBC has quite literally purchased a get-out-of-jail-free card for its employees for the price of $1.92 billion dollars.

   There is no doubt that the Department has “missed a rare chance to send an unmistakable signal about the threat posed by financial institutions willing to assist drug lords and terror groups in moving their money.” One international banking expert went as far as to argue that, despite the “astonishing amount of criminal behavior” from HSBC employees, the DPA is no more than a “parking ticket.”

But, as David Dayen at FDL News notes there are crickets from certain key senators:

Matt Stoller makes a very good point here: where is Patrick Leahy on this? He has made no public statement on the HSBC case, despite being the co-author of the Fraud Enforcement and Recovery Act, which was supposed to deliver funds toward prosecuting fraudulent big bank activity (it never actually did). Grassley, a co-author, has spoken out. Why not Leahy?

Matt Taibbi sat down with Amy Goodman and Juan Gonzalez at Democracy Now to discuss the settlement:

Transcript can be read here

Now, not only are the banks “too big to fail“, they are “too big to jail.”

This is actually a revision to a post i first wrote back in 2007, but it’s still just as pertinent (and pretty much unlearned) today as it was then and always has been… Also, to be clear, it’s going to take a lot of things to help prevent the now seemingly constant shootings we have here, including smart and serious gun control laws being enforced, better mental health awareness and parity, and perhaps even looking at our culture as a whole. I am only addressing that which has directly affected my life.

This post is about an issue near and dear to my heart as well as important in the wake of the Connecticut, Portland, and Aurora shootings, as well as all the other recent instances of mass shootings and suicides recently.

Often the first reaction in the wake of such incidences is shock; shock that it happened, and shock that the person could do what they did. But after all the surrounding knowledge comes to light, it’s really not that surprising that it happened or that the person in question could do it. Such is mental illness; only visible when we choose to see it.