February 2014 archive

“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: No Big Deal

Everyone knows that the Obama administration’s domestic economic agenda is stalled in the face of scorched-earth opposition from Republicans. And that’s a bad thing: The U.S. economy would be in much better shape if Obama administration proposals like the American Jobs Act had become law.

It’s less well known that the administration’s international economic agenda is also stalled, for very different reasons. In particular, the centerpiece of that agenda – the proposed Trans-Pacific Partnership, or T.P.P. – doesn’t seem to be making much progress, thanks to a combination of negotiating difficulties abroad and bipartisan skepticism at home.

And you know what? That’s O.K. It’s far from clear that the T.P.P. is a good idea. It’s even less clear that it’s something on which President Obama should be spending political capital. I am in general a free trader, but I’ll be undismayed and even a bit relieved if the T.P.P. just fades away.

New York Times Editorial Board: Business and the Minimum Wage

Much of the discussion about the Democratic proposal to raise the minimum wage to $10.10 an hour by 2016 has rightly focused on the workers who will clearly benefit from the move. But what about businesses? How would higher wages affect them?

The answer – contrary to a great deal of reflexive hand-wringing by some conservative think tanks and politicians – is surprisingly positive. Scholarly studies and the experience of businesses themselves show that what companies lose when they pay more is often offset by lower turnover and increased productivity. Businesses are also able to deal with higher costs by modestly increasing prices and by giving smaller increases to higher-paid employees. [..]

The argument that a higher minimum wage would hurt business is old and tired. There is clear and compelling evidence that the economy and companies enjoy real benefits when workers are paid more.

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.

February 28 is the 59th day of the year in the Gregorian calendar. There are 306 days remaining until the end of the year (307 in leap years)

On this day in 1953, Cambridge University scientists James D. Watson and Frances H.C. Crick announce that they have determined the double-helix structure of DNA, the molecule containing human genes.

History of DNA research

DNA was first isolated by the Swiss physician Friedrich Miescher who, in 1869, discovered a microscopic substance in the pus of discarded surgical bandages. As it resided in the nuclei of cells, he called it “nuclein”. In 1919, Phoebus Levene identified the base, sugar and phosphate nucleotide unit. Levene suggested that DNA consisted of a string of nucleotide units linked together through the phosphate groups. However, Levene thought the chain was short and the bases repeated in a fixed order. In 1937 William Astbury produced the first X-ray diffraction patterns that showed that DNA had a regular structure.

In 1928, Frederick Griffith discovered that traits of the “smooth” form of the Pneumococcus could be transferred to the “rough” form of the same bacteria by mixing killed “smooth” bacteria with the live “rough” form. This system provided the first clear suggestion that DNA carries genetic information, the Avery-MacLeod-McCarty experiment, when Oswald Avery, along with coworkers Colin MacLeod and Maclyn McCarty, identified DNA as the transforming principle in 1943. DNA’s role in heredity was confirmed in 1952, when Alfred Hershey and Martha Chase in the Hershey-Chase experiment showed that DNA is the genetic material of the T2 phage.

In 1953, James D. Watson and Francis Crick suggested what is now accepted as the first correct double-helix model of DNA structure in the journal Nature. Their double-helix, molecular model of DNA was then based on a single X-ray diffraction image (labeled as “Photo 51”) taken by Rosalind Franklin and Raymond Gosling in May 1952, as well as the information that the DNA bases are paired – also obtained through private communications from Erwin Chargaff in the previous years. Chargaff’s rules played a very important role in establishing double-helix configurations for B-DNA as well as A-DNA.

Experimental evidence supporting the Watson and Crick model were published in a series of five articles in the same issue of Nature. Of these, Franklin and Gosling’s paper was the first publication of their own X-ray diffraction data and original analysis method that partially supported the Watson and Crick model; this issue also contained an article on DNA structure by Maurice Wilkins and two of his colleagues, whose analysis and in vivo B-DNA X-ray patterns also supported the presence in vivo of the double-helical DNA configurations as proposed by Crick and Watson for their double-helix molecular model of DNA in the previous two pages of Nature. In 1962, after Franklin’s death, Watson, Crick, and Wilkins jointly received the Nobel Prize in Physiology or Medicine. However, Nobel rules of the time allowed only living recipients, but a vigorous debate continues on who should receive credit for the discovery.

Credit Suisse helped wealthy Americans cheat the IRS, Senate report says

By Danielle Douglas, Washington Post

Published: February 25

Swiss banking giant Credit ­Suisse helped wealthy Americans hide billions of dollars from U.S. tax collectors for several years and federal prosecutors have done little to hold violators accountable, according to a U.S. Senate subcommittee report due out Wednesday.

The allegations were particularly stunning in the face of the budget cuts and deficits that the United States faces, lawmakers said. The report casts the Justice Department as a hapless enforcer that has dragged its feet in getting Credit Suisse to turn over the names of some 22,000 U.S. customers.

Lawmakers have accused the bank of helping wealthy Americans avoid paying taxes on as much as $12 billion in assets held at the institution. Prosecutors have been aware of the misconduct at Credit Suisse for at least four years, in which time they have indicted seven bankers and launched a probe of the institution, according to the report. But no one has stood trial, and the bank has not been held legally accountable, the report says.

The Golden Rule: Why Bankers Are In Charge

by Ian Welsh

2014 February 26

The most potent message, and the strongest effect on behaviour, is when someone has the right to create money. Money, in our society, is created by borrowing. Banks and other financial institutions which have the right to lend thus have the right to create money. They have to have some form of collateral, even if that collateral is just an expectation of future earnings “great business idea, we’ll lend you money, and use your expected profits as our collateral.”

This money can be loaned out at multiples of the underlying asset. During the 2000s some brokerages were allowed multipliers (leverage) of over 40%. Even better, often whatever you buy with a leveraged loan can then be used as an asset for another round of leverage, leading to extremely high levels of effective leverage.

Some organizations also have access to very low interest rates: they can borrow at close to “prime” the rate the central bank offers to the very best credit risks. Major banks are amongst those who can borrow at this rate. They can then lend out to other people, again, at a higher interest rate, and with leverage.

If you, personally, could borrow money at 1% annual interest rate, and lend out ten times that, do you think you could make a profit? What is your mortgage rate? What is your credit card’s interest rate?

…

In theory profits are supposed to be self-limiting. If an industry makes more money than other industries, outsiders should see an opportunity, start up businesses, compete and drive down prices.

In the real world, that doesn’t happen as often as it does in theory, because you can’t just start up a bank with access to the Central Bank’s window. You can’t easily start up new pharmaceutical businesses, because it’s vastly expensive and there are huge regulatory hurdles. And when it does happen, why would you compete? Why not take the outsize profits? Why would you drive down profits? How does that benefit you?

The other check is supposed to be diminishing returns. The more money you have, the harder it is to find something to invest in: you run out of mortgages, or you run out of businesses to invest in which can make those returns. This does work, somewhat. It is at the heart of why the financial collapse happened: there weren’t enough assets for all the money chasing them, so widespread fraud occurred (liars loans, for example) and many people were given loans who couldn’t pay them back, while artificial assets were created which were not worth what they were sold for. Eventually this collapsed, but because the financial industry had already bought the political world, they were bailed out at a cost of trillions.

…

When you make millions in a few years: enough to live on for the rest of your life, in high style, it isn’t important if you’re driving the firm to bankruptcy. You don’t need the bank or the firm to be there, you’ve already made your mint.

Now, as a politician, if you do what the financial industry (or any other wealth industry) wants, they donate to your reelection campaign. They make sure your friends and family have jobs. They invite you to the best parties. And if you’re defeated, and have voted the right way, well, they’ll take care of you afterwards as well, with a cushy job. Bill Clinton, who deregulated Wall Street, is worth 100 million dollars.

Because bankers control a lot of money, they control what other people do.

So, just how much do you trust the NSA?  Do you even trust it’s “professionalism”?

Your Humble Blogger is the Probable Target of Penny-Ante Cyber Predation

by Yves Smith, Naked Capitalism

Posted on February 26, 2014

I was hacked yesterday.

On the scale of hacks, it was simultaneously trivial but meant to intimidate. Or else hugely inept.

I am on some politically-oriented listservs. They are all Google Groups, hence one has to have a Google account to post to them and receive messages from them. I also have one political correspondent who was very communicative a while back, and so I also filtered his messages into a separate folder. Generally I’m not a fan of filtering (I prefer to get everything in my main mail account) but these were two exceptions where it made sense to put them in a separate place. He uses Gmail. I set up both folders under my Gmail account.

Both those email boxes were gone yesterday. That does not mean the contents were gone, that means the folders were deleted and the messages were gone too (I use IMAP, not POP).

I am highly confident (to use the old Drexel formulation) that I didn’t delete them by accident. First, Macs give you all sorts of warnings for actions like that. Second, I only occasionally access those folders, and you have to highlight those accounts to do something stupid to them. Third, the removal of one could conceivably be an accident, but two? Particularly since these are the only two that are focused solely on political activity (by contrast, my main email box has so much spam, both genuine spam and news-related spamming, that the noise to content ratio is very high).

…

The more interesting question is therefore what this signifies. Deleting two folders both politically-related, is either very clumsy or intended to send a message. If the latter, even though I regularly harass banks, I doubt they’d be that interested. I don’t do much original reporting, as opposed to interpreting and sharpening public domain information. Banks are more concerned about what runs in the New York Times or the Washington Post or USA Today (or until recently, Rolling Stone). Blogs are ankle-biters at most and I doubt they see them as any threat. By contrast, I’ve been told our efforts have been helpful in at least for now stymieing the TransPacific Partnership, and we’ve also been consistent critics of Obamacare. My sense is the Democratic party feels vulnerable on the Obamacare front, with the Senate majority at risk in the midterm elections and the Republicans pounding on that topic (as confirmed by the frequency of the attacks in Democrat-favoring blogs on the MSM stories critical of Obamacare). So the odds favor this being someone who is not happy with our political writings of late. Note that the Project on Government Oversight, clearly a more influential group than NC, had a break-in that looked designed to intimidate rather than extract information. So this may be the fashion of the month in incursions.

Nevertheless, this sort of incursion is the cyber analogue of the sort of penny-ante predation the banks engage in routinely, like charging 3% for foreign exchange transactions. Yes, you can get a separate no-FX charge card, but if you are busy like me, and you actually do buy once in a while from foreign sites, it’s altogether too easy to forget to check to pay that weirdo card you hardly use and incur more in late fees than the 3% ripoff on your regular card. Or how about the $25 account charge if you balance drops below a certain level? I had that happen all of one day in one month last year and was royally pissed, and it was due to the order in which they credited charges versus deposits that day. Not worth fighting it.

Remember, if my aim was to end vulnerability, I can’t secure my communications by myself. I either have to encrypt (which requires two party cooperation) or at least get my most important correspondents on a more secure mail service. And I can’t participate in these very useful Google Groups. And if you’ve got a determined, well-connected intruder, we now know computers have backdoors at the Bios level. How does a mere mortal like me contend with that when even the hard-core techies seem flummoxed?

So just as we’ve all become resigned to having banks take more than they deserve, most of us are similarly resigned to routine snooping (the capture of data by vendors, use of cookies, etc). Those of us who are more visible on the Web face a correspondingly greater level of exposure. It’s just not possible to be secure and be on the Web, and I may accidentally be a little less at risk than most people in my shoes, not by virtue of great planning or even adequate defenses, but simply by not having migrated as much of my life to the computer or even a stupid phone as have the overwhelming majority of Americans.

Yes, we should be alarmed by documentation that shows spy agencies could be involved in dirty tricks

by digby, Hullabaloo

2/25/2014 01:30:00 PM

I notice that people are complaining about Glenn Greenwald’s latest piece about the spy agencies’ ratfucking operations because of its “tone” and I realize that it’s time to remind people of this little episode in case anyone’s gotten it into their heads that this is just some paranoid conspiracy theory.

…

If they could give us even one good reason beyond “because we can” and “maybe we might find it useful some day” perhaps people would be less alarmed. But when you have documented misuse of the data by private organizations, documented plans to use propaganda and dirty tricks to discredit dissenters along with not even one example of how these programs have been helpful, it’s just beyond my ken as to why people are still defending the government’s ongoing insistence that this is perfectly above board.

…

I truly believe that lies at the center of this issue. The national security apparatus and, in particular, the spy agencies, are like a cloistered cult at this point, completely oblivious to the real world implications of what they are doing or how it’s being perceived. They seem to be stunned that anyone would question them — a very bad characteristic for any institution with the kind of power they have. You don’t have to be an oracle to see how that can go sideways very easily. Indeed, all you have to do is look at that Chamber of Commerce gambit to see exactly how it can happen.

Conspiracy Theories

CASS R. SUNSTEIN University of Chicago – Law School

ADRIAN VERMEULE  Harvard University – Harvard Law School

January 15, 2008

Of course some conspiracy theories, under our definition, have turned out to be true. The Watergate hotel room used by Democratic National Committee was, in fact,  bugged by Republican officials, operating at the behest of the White House. In the 1950s, the Central Intelligence Agency did, in fact, administer LSD and related drugs under Project MKULTRA, in an effort to investigate the possibility of “mind control.” Operation Northwoods, a rumored plan by the Department of Defense to simulate acts of terrorism and to blame them on Cuba, really was proposed by high-level officials (though the plan never went into effect).

…

For our purposes, the most useful way to understand the pervasiveness of conspiracy theories is to examine how people acquire information. For most of what they believe that they know, human beings lack personal or direct information; they must rely on what other people think. In some domains, people suffer from a “crippled epistemology,” in the sense that they know very few things, and what they know is wrong. Many extremists fall in this category; their extremism stems not from irrationality, but from the fact that they have little (r elevant) information, and their extremist views are supported by what little they know. Conspiracy theorizing often has the same feature. Those who believe that Israel was responsible for the attacks of 9/11, or that the Central Intelligence Agency killed President Kennedy, may well be responding quite rationally to the informational signals that they receive. Consider here the suggestive fact that terrorism is more likely to arise in nations that lack civil rights and civil liberties. An evident reason for the connection is that terrorism is an extreme form of political protest, and when peo ple lack the usual outlets for registering their protest, they might resort to violence. But consider another  possibility: When civil rights and civil liberties are restricted, little information is available, and what comes from government cannot be trusted. If the trustworthy information justifies conspiracy theories and extremism, and (therefore?) violence, then terrorism is more likely to arise.

…

Cognitive infiltration

Rather than taking the continued existence of the hard core as a constraint, and addressing itself solely to the third-party mass audience, government might undertake (legal) tactics for breaking up the tight cognitive clusters of extremist theories, arguments and rhetoric that are produced by the hard core and reinforce it in turn. One promising tactic is cognitive infiltration of extremist groups. By this we do not mean 1960s-style infiltration with a view to surveillance and collecting information, possibly for use in future prosecutions. Rather, we mean that government efforts might succeed in weakening or even breaking up the ideological and epistemological complexes that constitute these networks and groups.

How might this tactic work? Recall that extremist networks and groups, including the groups that purvey conspiracy theories, typically suffer from a kind of crippled epistemology. Hearing only conspiratorial accounts of government behavior, their members become ever more prone to believe and generate such accounts. Informational and reputational cascades, group polarization, and selection effects suggest that the generation of ever-more-extreme views within these groups can be dampened or reversed by the introduction of cognitive diversity. We suggest a role for government efforts, and agents, in introducing such diversity. Government agents (and their allies) might enter chat rooms, online social networks, or even real-space groups and attempt to undermine percolating conspiracy theories by raising doubts about their factual premises, causal logic or implications for political action.

In one variant, government agents would openly proclaim, or at least make no effort to conceal, their institutional affiliations. A recent newspaper story recounts that Arabic-speaking Muslim officials from the State Department have participated in dialogues at radical Islamist chat rooms and websites in order to ventilate arguments not usually heard among the groups that cluster around those sites, with some success. In another variant, government officials would participate anonymously or even with false identities. Each approach has distinct costs and benefits; the second is riskier but  potentially brings higher returns. In the former case, where government officials  participate openly as such, hard-core members of the relevant networks, communities and conspiracy-minded organizations may entirely discount what the officials say, right from the beginning. The risk with tactics of anonymous participation, conversely, is that if the tactic becomes known, any true member of the relevant groups who raises doubts may be suspected of government connections. Despite these difficulties, the two forms of cognitive infiltration offer different risk-reward mixes and are both potentially useful instruments.

There is a similar tradeoff along another dimension: whether the infiltration should occur in the real world, through physical penetration of conspiracist groups by undercover agents, or instead should occur strictly in cyberspace. The latter is safer, but  potentially less productive. The former will sometimes be indispensable, where the groups that purvey conspiracy theories (and perhaps themselves formulate conspiracies) formulate their views through real-space informational networks rather than virtual networks. Infiltration of any kind poses well-known risks: perhaps agents will be asked to perform criminal acts to prove their bona fides, or (less plausibly) will themselves  become persuaded by the conspiratorial views they are supposed to be undermining;  perhaps agents will be unmasked and harmed by the infiltrated group. But the risks are generally greater for real-world infiltration, where the agent is exposed to more serious harms.

Indeed, for some sycophantic OLC conception of “It’s legal if the President does it” that was Nixon’s last refuge from the rule of law.  Even England rejected this concept of despotic rule 799 years ago.

In a Web-exclusive interview, political scientist Adolph Reed Jr. talks with Bill Moyers about his new article in the March issue of Harper’s Magazine – a challenge to America’s progressives provocatively titled, “Nothing Left: The Long, Slow Surrender of American Liberals.”

In the piece, Reed writes that Democrats and liberals have become too fixated on election results rather than aiming for long term goals that address the issues of economic inequality, and that the administrations of Bill Clinton and Barack Obama too often acquiesced to the demands of Wall Street and the right.

As a result, Reed tells Moyers, the left is no longer a significant force in American politics. “If we understand the left to be anchored to our convictions that society can be made better than it actually is, and a commitment to combating economic inequality as a primary one, the left is just gone.”

Liberals Face a Hard Day’s Knight?

By Michael Winship, Moyers and Company

That’s a pretty pathetic knight up there on the cover of the March issue of Harper’s Magazine. Battered and defeated, his shield in pieces, he’s slumped and saddled backwards on a Democratic donkey that has a distinctly woeful – or bored, maybe – countenance. It’s the magazine’s sardonic way of illustrating a powerful throwing down of the gauntlet by political scientist Adolph Reed, Jr. He has challenged the nation’s progressives with an article in the magazine provocatively titled “Nothing Left: The Long, Slow Surrender of American Liberals.”

His thesis flies in the face of a current spate of articles and op-ed columns touting a resurgence of progressive politics within the Democratic Party – often pointing to last year’s elections of Senator Elizabeth Warren in Massachusetts and Bill de Blasio as mayor of New York City as evidence – although at the same time many of the pieces note that the wave is smashing up against a wall of resistance from the corporate wing of the party. [..]

Reed says that the presidencies of Democrats Bill Clinton and Barack Obama too often acquiesced to the demands of Wall Street and the right. Of Clinton’s White House years, he clams, “It is difficult to imagine that a Republican administration could have been much more successful in advancing Reaganism’s agenda.” And President Obama “has always been no more than an unexceptional neo-liberal Democrat with an exceptional knack for self-presentation persuasive to those who want to believe, and with solid connections and considerable good will from the corporate and financial sectors… his appeal has always been about the persona he projects – the extent to which he encourages people to feel good about their politics, the political future, and themselves through feeling good about him – than about any concrete vision or political program he has advanced. And that persona has always been bound up in and continues to play off complex and contradictory representations of race in American politics.”

“The left has no particular place it wants to go,” Reed asserts. “And, to rehash an old quip, if you have no destination, any direction can seem as good as any other… the left operates with no learning curve and is therefore always vulnerable to the new enthusiasm. It long ago lost the ability to move forward under its own steam…”

Up dated with a link to Prof. Reid’s article in Harper’s Magazince

The Long, Slow Surrender of American Liberals

For nearly all the twentieth century there was a dynamic left in the United States grounded in the belief that unrestrained capitalism generated unacceptable social costs. That left crested in influence between 1935 and 1945, when it anchored a coalition centered in the labor movement, most significantly within the Congress of Industrial Organizations (CIO). It was a prominent voice in the Democratic Party of the era, and at the federal level its high point may have come in 1944, when FDR propounded what he called “a second Bill of Rights.” Among these rights, Roosevelt proclaimed, were the right to a “useful and remunerative job,” “adequate medical care,” and “adequate protection from the economic fears of old age, sickness, accident, and unemployment.”

The labor-left alliance remained a meaningful presence in American politics through the 1960s. What have become known as the social movements of the Sixties – civil rights activism, protests against the Vietnam War, and a renewed women’s movement – were vitally linked to that egalitarian left. Those movements drew institutional resources, including organizing talents and committed activists, from that older left and built on both the legislative and the ideological victories it had won. But during the 1980s and early 1990s, fears of a relentless Republican juggernaut pressured those left of center to take a defensive stance, focusing on the immediate goal of electing Democrats to stem or slow the rightward tide. At the same time, business interests, in concert with the Republican right and supported by an emerging wing of neoliberal Democrats, set out to roll back as many as possible of the social protections and regulations the left had won. As this defensiveness overtook leftist interest groups, institutions, and opinion leaders, it increasingly came to define left-wing journalistic commentary and criticism. New editorial voices – for example, The American Prospect – emerged to articulate the views of an intellectual left that defined itself as liberal rather than radical. To be sure, this shift was not absolute. Such publications as New Labor Forum, New Politics, Science & Society, Monthly Review, and others maintained an oppositional stance, and the Great Recession has encouraged new outlets such as Jacobin and Endnotes. But the American left moved increasingly toward the middle.

Today, the labor movement has been largely subdued, and social activists have made their peace with neoliberalism and adjusted their horizons accordingly. Within the women’s movement, goals have shifted from practical objectives such as comparable worth and universal child care in the 1980s to celebrating appointments of individual women to public office and challenging the corporate glass ceiling. Dominant figures in the antiwar movement have long since accepted the framework of American military interventionism. The movement for racial justice has shifted its focus from inequality to “disparity,” while neatly evading any critique of the structures that produce inequality.

“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

Dean Baker: Time to tax Wall Street

Horror stories of obnoxious investment bankers should make the public scream, ‘Enough!’

Many people already had low opinions of the Wall Street elite. I’m referring to the investment-banker types who get incredibly rich through financial manipulations, government bailouts and implicit government guarantees provided for too-big-to-fail banks. But a recent New York magazine piece showed that even the most jaded were being too generous in their assessment of this gang.

Kevin Roose, who was working as a New York Times reporter at the time, managed to infiltrate a black-tie party at the St. Regis Hotel sponsored by a secret Wall Street fraternity. The so-called Kappa Beta Phi (the reverse of Phi Beta Kappa, the academic honor society) was not made up of a bunch of college kids or recent grads. It featured many of the leading figures on Wall Street – multimillionaires and billionaires, all of whom were well past the age at which we expect people to start being responsible for their actions. [..]

The anger prompted by Roose’s account makes this a great time to bring back the idea of taxing their speculation. While Dodd-Frank reforms will curb some of the worst abuses, the Wall Streeters are still making huge fortunes shuffling money rather than doing anything productive. A modest tax can raise a huge amount of money for productive ends, such as infrastructure and education, while making shuffling money a bit less profitable.

David Cay Johnston: The shocking numbers behind corporate welfare

Boeing and its stockholders fly high on tax dollars

State and local governments have awarded at least $110 billion in taxpayer subsidies to business, with 3 of every 4 dollars going to fewer than 1,000 big corporations, the most thorough analysis to date of corporate welfare revealed today.

Boeing ranks first, with 137 subsidies totaling $13.2 billion, followed by Alcoa at $5.6 billion, Intel at $3.9 billion, General Motors at $3.5 billion and Ford Motor at $2.5 billion, the new report by the nonprofit research organization Good Jobs First shows.

Dow Chemical had the most subsidies, 410 totaling $1.4 billion, followed by Warren Buffett’s Berkshire-Hathaway holding company, with 310 valued at $1.1 billion.

The figures were compiled from disclosures made by state and local government agencies that subsidize companies in all sorts of ways, including cash giveaways, building and land transfers, tax abatements and steep discounts on electric and water bills.

In fact, the numbers significantly understate the true value of taxpayer subsidies to businesses, for reasons explained below.

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.

February 27 is the 58th day of the year in the Gregorian calendar. There are 307 days remaining until the end of the year (308 in leap years).

On this day in 1827, New Orleanians take to the streets for Mardi Gras with groups of masked and costumed students dance through the streets of New Orleans, Louisiana, marking the beginning of the city’s famous Mardi Gras celebrations.

The celebration of Carnival–or the weeks between Twelfth Night on January 6 and Ash Wednesday, the beginning of the Christian period of Lent–spread from Rome across Europe and later to the Americas. Nowhere in the United States is Carnival celebrated as grandly as in New Orleans, famous for its over-the-top parades and parties for Mardi Gras (or Fat Tuesday), the last day of the Carnival season.

History

The celebration of Mardi Gras was brought to Louisiana by early French settlers. The first record of the holiday being celebrated in Louisiana was at the mouth of the Mississippi River in what is now lower Plaquemines Parish, Louisiana, on March 3, 1699. Iberville, Bienville, and their men celebrated it as part of an observance of Catholic practice.

The starting date of festivities in New Orleans is unknown. An account from 1743 notes that the custom of Carnival balls was already established. Processions and wearing of masks in the streets on Mardi Gras took place. They were sometimes prohibited by law, and were quickly renewed whenever such restrictions were lifted or enforcement waned. In 1833 Bernard Xavier de Marigny de Mandeville, a rich plantation owner of French descent, raised money to fund an official Mardi Gras celebration.

James R. Creecy in his book Scenes in the South, and Other Miscellaneous Pieces describes New Orleans Mardi Gras in 1835:

   Shrove Tuesday is a day to be remembered by strangers in New Orleans, for that is the day for fun, frolic, and comic masquerading. All of the mischief of the city is alive and wide awake in active operation. Men and boys, women and girls, bond and free, white and black, yellow and brown, exert themselves to invent and appear in grotesque, quizzical, diabolic, horrible, strange masks, and disguises. Human bodies are seen with heads of beasts and birds, beasts and birds with human heads; demi-beasts, demi-fishes, snakes’ heads and bodies with arms of apes; man-bats from the moon; mermaids; satyrs, beggars, monks, and robbers parade and march on foot, on horseback, in wagons, carts, coaches, cars, etc., in rich confusion, up and down the streets, wildly shouting, singing, laughing, drumming, fiddling, fifeing, and all throwing flour broadcast as they wend their reckless way.

On Mardi Gras of 1857, the Mystick Krewe of Comus held its first parade. Comus is the oldest continuously active Mardi Gras organization. It started a number of continuing traditions. It is considered the first Carnival krewe in the modern sense. According to one historian, “Comus was aggressively English in its celebration of what New Orleans had always considered a French festival. It is hard to think of a clearer assertion than this parade that the lead in the holiday had passed from French-speakers to Anglo-Americans. . . .To a certain extent, Americans ‘Americanized’ New Orleans and its Creoles. To a certain extent, New Orleans ‘creolized’ the Americans. Thus the wonder of Anglo-Americans boasting of how their business prowess helped them construct a more elaborate version of the old Creole Carnival. The lead in organized Carnival passed from Creole to American just as political and economic power did over the course of the nineteenth century. The spectacle of Creole-American Carnival, with Americans using Carnival forms to compete with Creoles in the ballrooms and on the streets, represents the creation of a New Orleans culture neither entirely Creole nor entirely American.”

In 1875 Louisiana declared Mardi Gras a legal state holiday. War, economic, political, and weather conditions sometimes led to cancellation of some or all major parades, especially during the American Civil War, World War I and World War II, but the city has always celebrated Carnival.

The Secretary of Defense Chuck Hagel announced that the upcoming Pentagon budget would focus on the 21st century realities of warfare with more emphasis on targeted assassinations and cyberwarfare. It also cuts the strength of the Army to pre-World War Two levels relying more heavily on the National Guard.

   Defense Secretary Chuck Hagel plans to shrink the United States Army to its smallest force since before the World War II buildup and eliminate an entire class of Air Force attack jets in a new spending proposal that officials describe as the first Pentagon budget to aggressively push the military off the war footing adopted after the terror attacks of 2001 [..]

   The new American way of war will be underscored in Mr. Hagel’s budget, which protects money for Special Operations forces and cyberwarfare. And in an indication of the priority given to overseas military presence that does not require a land force, the proposal will – at least for one year – maintain the current number of aircraft carriers at 11.

The Guard and Reserves, which proved capable in their wartime deployments although costly to train to meet the standards of their full-time counterparts, would face smaller reductions. But the Guard would see its arsenal reshaped.

The Guard’s Apache attack helicopters would be transferred to the active-duty Army, which would transfer its Black Hawk helicopters to the Guard. The rationale is that Guard units have less peacetime need for the bristling array of weapons on the Apache and would put the Black Hawk – a workhorse transport helicopter – to use in domestic disaster relief.

The proposed budget would also eliminate the old U-2 spy plane in favor of unmanned drones and eliminate the entire fleet of Air Force A-10 attack aircraft. However, it does keep the allocations for the controversial F-35 warplane, which has been extremely expensive and has run into costly delays, that the Air Force says it doesn’t want.

There will be pain for the troops, too.

The fiscal 2015 budget also calls for slowing the growth of tax-free housing allowances for military personnel and would reduce the $1.4 billion direct subsidy provided to military commissaries, which would most likely make goods purchased at those commissaries more expensive for soldiers.

The budget also proposes an increase in health insurance deductibles and some co-pays for some military retirees and for some family members of active servicemen.

The savings on groceries will reduced, costing a military family as much as $3000 per year, and pay raises will be capped:

Besides paring back grocery savings, the Pentagon would also cap military pay raises at 1% in 2015 and trim housing subsidies for families who don’t live on bases. They will also no longer be reimbursed for rental insurance.

Families are likely to feel the sharpest pain every week when they shop for their grocery. By the end of the third year, the savings will be slashed by about two-thirds, a senior defense official acknowledged on Monday.

Currently, a family of four can save $4,500 a year at commissaries on average, according to the Defense Commissary Agency, which puts savings around 30% compared to retail grocery stores. Under the new proposal, the savings for a similar family would be closer to $1,500 a year or 10% of a grocery bill at other stores.

Despite these cuts and the claims, this hardly an austerity budget still exceeding the budgets of next ten military budgets in the world combined.

A better idea, as suggested by DSWright at FDL News Desk would be “to rethink 800 military bases and a $700 billion annual budget to defend against an enemy that no longer exists.” But the fear mongers will persist regardless:

Despite ‘historic’ cuts, the US will still have 450,000 active-duty soldiers

By Michael Cohen, The Guardian

The Pentagon is able to maintain a bloated and extravagant military force even when the US faces no actual security threats

Rather than a reflection of a changing global security environment, the growing and continued obsolescence of inter-state war and the country’s lack of interest in future military adventures, the cuts announced yesterday by Hagel are an indication of something else altogether: how tenaciously the Pentagon is able to maintain a bloated and extravagant military force even when the US faces no actual security threats.

Indeed, what was missing from yesterday’s headlines was some much needed context. For example, “smallest size since 1940” sounds, on the surface, like quite a step back. Did Neville Chamberlain rise from his grave and become president of the United States? Let’s put aside for a second that the size of the army in 1940 was about 270,000 and the Marine Corps stood at about 30,000 – a far cry from the proposed 180,000 today.

The truth is the military budget is still bloated with wasted tax dollars that could got to rebuilding the US infrastructure that would create jobs increasing economic growth and reducing income disparity.