Daily Archive: 02/09/2015

Feb 09 2015

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”.

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Paul Krugman: Nobody Understands Debt

Many economists, including Janet Yellen, view global economic troubles since 2008 largely as a story about “deleveraging” – a simultaneous attempt by debtors almost everywhere to reduce their liabilities. Why is deleveraging a problem? Because my spending is your income, and your spending is my income, so if everyone slashes spending at the same time, incomes go down around the world.

Or as Ms. Yellen put it in 2009, “Precautions that may be smart for individuals and firms – and indeed essential to return the economy to a normal state – nevertheless magnify the distress of the economy as a whole.”

So how much progress have we made in returning the economy to that “normal state”? None at all. You see, policy makers have been basing their actions on a false view of what debt is all about, and their attempts to reduce the problem have actually made it worse.

Charles M. Blow: Beyond ‘Black Lives Matter’

The Black Lives Matter protesters took some criticism for what others viewed as a lack of clear focus and detailed agenda. But in truth, raising an issue to the point where it can no longer be ignored is the grist for the policy mill. Visibility and vocalization have value.

In the same way that Occupy Wall Street forever elevated that concept of income inequality, the Black Lives Matter protesters have elevated the idea of inequity in policing as it relates to minority communities. [..]

But, as is often the case, there was no full resolution or reconciliation. The issue of police-community relations was raised but not solved. The memory of mistrust still wafts through the air like the smell of rot being carried by the breeze.

What was it all for? What came of it? Where do we go from here?

Richard (RJ) Eskow: More Evidence That ‘Centrist’ Solutions Can’t Save Us

We have become a profoundly unequal society. That reality is explored in new detail in a recent study from the Institute for New Economic Thinking (INET). Even more importantly, the INET study shows that it will take a dramatic shift in policy to restore the equilibrium. Unless we can build momentum for a new political agenda, we’ll be divided into a small minority with fabulous wealth and a permanent underclass with few hopes or prospects.

Unfortunately, our mainstream political dialogue shows no sign of adapting to these realities. As the INET study confirms, mainstream Democratic ideas won’t protect us from this dismal future.

Republican policies? Don’t ask.

Robert Kuttner: Will the Recovery Finally Translate into Better Wages?

The good news about the economy’s improved job creation dominated the weekend’s headlines. Many commentators concluded that the economy is finally shaking off the effects of the financial collapse of 2008 and the long period of stagnation that followed. [..]

In this recovery, the economy has been creating more low-wage jobs than high-wage ones. The shift from standard payroll jobs to temp and contract work continues.

The uptick in the measured unemployment rate, from 5.6 percent to 5.7 percent, suggests that discouraged workers are only just coming back into the labor force and we are a long way from full employment. Even at the present rate of improved job creation, it will be 2017 before we get back to the pre-recession level of unemployment.

The beginning of a process where job creation actually translates into improved living standards is long overdue, but there are several dangers ahead.

Gary Younge: Deluded and dysfunctional, the Republicans have lost the plot

Recently, in an effort to embarrass Republicans pandering to their scientifically challenged base, Senate Democrats proposed a series of votes on climate change. While most Americans and the overwhelming majority of scientists believe climate change is real and people are the primary cause of it, Republican voters are evenly divided on whether it exists at all, and reject the idea that we are responsible. [..]

As a means, bipartisanship is, of course, an admirable goal: the more politicians are able to work together, put the interests of their constituents first and get things done, the better. The grandstanding, bickering and procedural one-upmanship that characterises so much of what passes for politics is one of the things that makes electorates cynical and drives down voter turnout.

But as an end in itself, bipartisanship is at best shallow and at worst corrosive. For it entirely depends what parties are joining together to do. This is particularly true in America, where constituencies are openly gerrymandered, both parties are funded by big money, and legislation is often written by corporate lobbyists.

Michael Smerconish: Mr. President, Release the 28 Pages

Zacarias Moussaoui has just upped the ante on the White House to release 28 top-secret pages from a congressional report pertinent to a possible Saudi role in the events of 9/11. [..]

Moussaoui’s account of being a liaison between Osama bin Laden and members of the Saudi royal family was told to Philadelphia lawyer Sean Carter over the course of two days of questioning in October at the federal supermax prison in Florence, Colo., and has only now been cleared for public release by the U.S. government.

Carter has been defending against a Saudi motion to dismiss his case, facing the unenviable burden of producing evidence of a Saudi link to al-Qaeda without the benefit of taking discovery. Moussaoui’s testimony was unforeseen. The man who once took flight lessons in Oklahoma and Minnesota in preparation for a terror strike contacted the federal judge presiding over the case and offered to provide information.

Feb 09 2015

TBC: Morning Musing 2.9.15

I have 3 things for your perusal this morning.

First, on the big oil worker strike going on right now:

First Nationwide Oil Worker Strike In Decades Grows Even Bigger

In January there were at least four major mishaps at a U.S. pipelines that resulted in costly explosions or spills. In 2013, Texas led the country in oil and gas sector fatalities with 106. Overall, oil and gas workers are six times more likely to die on the job than average Americans. With the recent growth of the industry due to the proliferation of new drilling techniques such as fracking, safety measures can suffer. In North Dakota, which has been at the forefront of the oil boom, the fatality rate for industry workers was three times the national average in 2013.

On Friday, the local Toledo union posted on its Facebook page that the “strike is NOT about money, this is about addressing safety issues that have been ignored for way too long … 138 workers were killed on the job while extracting, producing, or supporting oil and gas in 2012 … the number was more than double that of 2009.”

Jump!

Feb 09 2015

On This Day In History February 9

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 9 is the 40th day of the year in the Gregorian calendar. There are 325 days remaining until the end of the year (326 in leap years).

On this day in 1950, Joseph Raymond McCarthy, a relatively obscure Republican senator from Wisconsin, accuses State Department of being infiltrated by communists. McCarthy announces during a speech in Wheeling, West Virginia, that he has in his hand a list of 205 communists who have infiltrated the U.S. State Department. The unsubstantiated declaration, which was little more than a publicity stunt, suddenly thrust Senator McCarthy into the national spotlight.

Asked to reveal the names on the list, the reckless and opportunistic senator named officials he determined guilty by association, such as Owen Lattimore, an expert on Chinese culture and affairs who had advised the State Department. McCarthy described Lattimore as the “top Russian spy” in America.

These and other equally shocking accusations prompted the Senate to form a special committee, headed by Senator Millard Tydings of Maryland, to investigate the matter. The committee found little to substantiate McCarthy’s charges, but McCarthy nevertheless touched a nerve in the American public, and during the next two years he made increasingly sensational charges, even attacking President Harry S. Truman’s respected former secretary of state, George C. Marshall.

Wheeling speech

McCarthy experienced a meteoric rise in national profile on February 9, 1950, when he gave a Lincoln Day speech to the Republican Women’s Club of Wheeling, West Virginia. His words in the speech are a matter of some debate, as no audio recording was saved. However, it is generally agreed that he produced a piece of paper that he claimed contained a list of known Communists working for the State Department. McCarthy is usually quoted to have said: “The State Department is infested with communists. I have here in my hand a list of 205-a list of names that were made known to the Secretary of State as being members of the Communist Party and who nevertheless are still working and shaping policy in the State Department.”

There is some dispute about whether or not McCarthy actually gave the number of people on the list as being “205” or “57”. In a later telegram to President Truman, and when entering the speech into the Congressional Record, he used the number 57. The origin of the number 205 can be traced: In later debates on the Senate floor, McCarthy referred to a 1946 letter that then-Secretary of State James Byrnes sent to Congressman Adolph J. Sabath. In that letter, Byrnes said State Department security investigations had resulted in “recommendation against permanent employment” for 284 persons, and that 79 of these had been removed from their jobs; this left 205 still on the State Department’s payroll. In fact, by the time of McCarthy’s speech only about 65 of the employees mentioned in the Byrnes letter were still with the State Department, and all of these had undergone further security checks.

At the time of McCarthy’s speech, communism was a growing concern in the United States. This concern was exacerbated by the actions of the Soviet Union in Eastern Europe, the fall of China to the communists, the Soviets’ development of the atomic bomb the year before, and by the contemporary controversy surrounding Alger Hiss and the confession of Soviet spy Klaus Fuchs. With this background and due to the sensational nature of McCarthy’s charge against the State Department, the Wheeling speech soon attracted a flood of press interest in McCarthy.

Feb 09 2015

Bank That Laundered Drug Money Revealed to Be Doing Worse

It seems that since 2010, the US Department of Justice has known that one of the largest banks in Europe has been sheltering money for dictators and arms dealers, among others:

Banking Giant HSBC Sheltered Murky Cash Linked to Dictators and Arms Dealers

By Gerard Ryle, Will Fitzgibbon, Mar Cabra, Rigoberto Carvajal, Marina Walker Guevara, Martha M. Hamilton and Tom Stites, February 8, 2015, The International Consortium of Investigative Jouranlists

Team of journalists from 45 countries unearths secret bank accounts maintained for criminals, traffickers, tax dodgers, politicians and celebrities

Secret documents reveal that global banking giant HSBC profited from doing business with arms dealers who channeled mortar bombs to child soldiers in Africa, bag men for Third World dictators, traffickers in blood diamonds and other international outlaws.

The leaked files, based on the inner workings of HSBC’s Swiss private banking arm, relate to accounts holding more than $100 billion. They provide a rare glimpse inside the super-secret Swiss banking system – one the public has never seen before. [..]

These disclosures shine a light on the intersection of international crime and legitimate business, and they dramatically expand what’s known about potentially illegal or unethical behavior in recent years at HSBC, one of the world’s largest banks.

The leaked account records show some clients making trips to Geneva to withdraw large wads of cash, sometimes in used notes. The files also document huge sums of money controlled by dealers in diamonds who are known to have operated in war zones and sold gemstones to finance insurgencies that caused untold deaths.

These are some of the key findings the journalists found:

 

HSBC Private Bank (Suisse) continued to offer services to clients who had been unfavorably named by the United Nations, in court documents and in the media as connected to arms trafficking, blood diamonds and bribery.

   HSBC served those close to discredited regimes such as that of former Egyptian president Hosni Mubarak, former Tunisian president Ben Ali and current Syrian ruler Bashar al-Assad.

   Clients who held HSBC bank accounts in Switzerland include former and current politicians from Britain, Russia, Ukraine, Georgia, Kenya, Romania, India, Liechtenstein, Mexico, Lebanon, Tunisia, the Democratic Republic of the Congo, Zimbabwe, Rwanda, Paraguay, Djibouti, Senegal, Philippines and Algeria.

   The bank repeatedly reassured clients that it would not disclose details of accounts to national authorities, even if evidence suggested that the accounts were undeclared to tax authorities in the client’s home country. Bank employees also discussed with clients a range of measures that would ultimately allow clients to avoid paying taxes in their home countries. This included holding accounts in the name of offshore companies to avoid the European Savings Directive, a 2005 Europe-wide rule aimed at tackling tax evasion through the exchange of bank information.

If this seems all too familiar, that’s because it is. HSBC was fined $1.6 billion in June of 2013 after it reached an agreement with the US Department of Justice which resolved charges it enabled Latin American drug cartels to launder billions of dollars

HSBC was accused of failing to monitor more than $670 billion in wire transfers and more than $9.4 billion in purchases of U.S. currency from HSBC Mexico, allowing for money laundering, prosecutors said. The bank also violated U.S. economic sanctions against Iran, Libya, Sudan, Burma and Cuba, according to a criminal information filed in the case. [..]

Under a deferred prosecution agreement, the U.S. allows a target to avoid charges by meeting certain conditions — including the payment of fines or penalties — and by committing to specific reforms.

US government faces pressure after biggest leak in banking history

So just what was the Department of Justice and the IRS doing with this information about the bank and its clients? Apparently not much.

Confronted by the Guardian’s evidence, HSBC admitted wrongdoing by its Geneva-based subsidiary. “We acknowledge and are accountable for past compliance and control failures,” the bank said in a statement. The Swiss arm, the statement said, had not been fully integrated into HSBC after its purchase in 1999, allowing “significantly lower” standards of compliance and due diligence to persist. [..]

The 2012 settlement was overseen by Loretta Lynch, who was then US Attorney for the Eastern District of New York. Lynch is currently Barack Obama’s current nominee for attorney general.

At the time, the HSBC settlement was heavily criticised by both Republicans and Democrats for allowing the bank to escape criminal indictments and keep the charter which enables it to operate in the US. Lynch and other senior DoJ officials defended the deal, pointing out it committed HSBC to a five-year plan to stamp out money laundering and other illicit practices, an ongoing process that is being overseen by an independent, court-appointed monitor. [..]

The DoJ was under pressure to go beyond financial penalties – to bring criminal charges against HSBC or its bankers – in July 2012, after the Senate’s permanent subcommittee on investigations published its crushing 330-page report documenting how the bank’s lax anti-money laundering controls had been exploited by drug traffickers. [..]

The settlement proved controversial because it stopped short of criminally indicting the bank or its executives; lawmakers from both parties complained it revealed some Wall Street institutions were considered “too big to jail”. [..]

HSBC is now just over two years into its reform plan, and has been deemed to be complying with the terms of the settlement. However the court-appointed monitor, Michael Cherkasky, who oversees a team of banking investigators who review HSBC’s changes, has expressed some concern over the pace of reform. Cherkasky’s most recent assessment of HSBC’s ongoing efforts to clean up its act has once again concluded it could do better, according a recent report in the Wall Street Journal which cited people familiar with its findings.

CBS’s “60 Minutes” aired The Swiss Leaks a report by Bill Whitaker that examined “HSBC’s business dealings with a collection of international outlaws.”

Transcript can be read here

The sickening part of this is the US Justice Department was well aware of this when they settled the HSBC’s drug laundering case in 2013. Also. HSBC is one of the institutions that is refusing to handle the money of legitimate marijuana businesses.

Nice going, Eric.

Feb 09 2015

Sunday Night Movie