Saturday, December 18, 2010

Corporate America's Plan to Loot Our Pensions Is the Latest Battle in Decades-Long Assault on the Middle Class

While the safety net is being withered by attrition, record corporate profits are deemed off-limits for discussion about closing the budget gap.
By Arun Gupta, AlterNet
Posted on December 18, 2010

The severe economic crisis, now in its fourth year, is being used to batter the remnants of the social welfare state. Having decimated aid to the poor over the last 30 years, especially in the United States, the economic and political elite are now intent on strangling middle-class benefits, namely state-provided pensions, health care and education.

The initial neoliberal assault under Ronald Reagan and Margaret Thatcher reorganized the capitalist economy and hammered private-sector unions into submission. This was accomplished by putting labor back into competition with itself by off-shoring industrial production, through deregulation and with frontal assaults on labor rights, organizing and solidarity.

Similarly, the current attack is a two-pronged effort to reorganize state social services, either by eliminating or privatizing them, and decimate public-sector unions whose workers provide those services. While the safety net is being withered by attrition, police and spying agencies are getting more powers and funding, and the wealth of the super-rich and record corporate profits are deemed off-limits to taxation to close any government budget gap.

Simply put, the elderly are superfluous to capitalism. With high rates of joblessness the “new norm,” more and more people are being made disposable. This leads to an efficient if brutal logic: cutting old-age income and health care will make it easier to scrap old, useless workers. In fact, this reality is already coming to pass. One study published in 2008 found that over a 16-year period life expectancy had declined for many poor American women — precisely those who are disproportionately represented among the elderly heavily dependent on Social Security and Medicare.

Slashing social services affects everyone by increasing the pool of workers desperate for any sort of paying job, pushing down wages and benefits. This will all be pushed under the rubric of “personal responsibility,” and it will probably be successful as long as opposition is weak and divided. The main beneficiaries will be the super-wealthy who gain both from tax cuts as the social sector is chopped up and higher corporate profits as wages and benefits are slashed more deeply.

The attack on pensions is mainly occurring in the West and those countries close to its orbit. So while the United States, Greece, Ireland, Japan, France, Turkey, Spain, Poland and Latvia have been cutting or trying to squeeze state-run pensions, others such as Bolivia, China and Venezuela have been increasing funding of old-age pensions in recent years (though within these countries the picture is more complicated because social spending may be declining overall and inflation increasing).

The Right has stridently opposed Social Security since it was enacted in 1935, but the modern attack on pensions originated during the Reagan-Thatcher era. While he proposed making Social Security voluntary during the 1964 Goldwater campaign, when he reached office Reagan temporarily froze cost-of-living adjustments, raised the future retirement age to 67, taxed benefits of higher-income earners, made it more difficult for the disabled to claim benefits and forced the self-employed to pay 100 percent of payroll taxes. Then under Clinton, according to some economists, inflation was understated to suppress cost-of-living adjustments, resulting in benefits that should be 50 percent higher than the current average of $1,072 a month. Thatcher and Tony Blair formed the same one-two punch as Reagan and Clinton, but they went further by partially privatizing much of the state-run pension system.

The second historical component is the current crisis, which is severely widening the economic chasm. According to the New York Times, corporate profits “have grown for seven consecutive quarters, at some of the fastest rates in history,” hitting a record of $1.66 trillion on an annual basis. Taking advantage of Federal Reserve and U.S. Treasury monies, Wall Street has notched record profits over the last two years. And the top one percent actually increased their share of the wealth through the end of 2009.

As for the overall economic picture, industrial production is back to where it was in 2000 and the all-important capacity utilization rate – which measures how much of existing manufacturing plants are actually operating – is below 75 percent, compared to a level above 80 percent before the crash. This is like saying more than one-fourth of factories are idle. The trade deficit is at 3.7 percent of the gross domestic product. Only 874,000 jobs were created during the first 10 months of 2010, well short of the 1.2 million needed to keep up with population growth, and some 260,000 state workers lost their jobs during this period, leaving 7.5 million fewer jobs than when the recession began.

The household picture is even grimmer: family income shrank more than 4 percent in 2008 and 2009; the official poverty rate of 14.3 is the highest since 1994; 13.5 percent of home mortgages are in delinquency or foreclosure; the percentage of people receiving health insurance through their employer has dropped by 13 percent over the last decade and the real unemployment rate -- the “U6 rate” which includes those who have given up looking for work -- is at 17 percent. Household debt stands at 118 percent of after-tax income.

Most economists say there are really only four sources of potential growth in our economy: consumer spending, business investment, trade and government. As the data above indicates, the first three are on life support, while the Obama White House bungled the stimulus plan, helping the right in discrediting government intervention, which is still the only remaining option. These economic conditions prevail throughout the West, which is the backdrop for the global assault on pension plans. Thus the conclusion is stark: there is no functioning engine to drive economic growth.

With so much idle productive capacity, the bromide of giving tax breaks to spur business investment is little more than throwing away money. With American families drowning in debt, getting smacked with rising healthcare costs, having lost $15.8 trillion in wealth and fearing joining the armies of unemployed, they are incapable of pulling the economy out of its funk with increased consumption. Increased trade is one possibility, which would require a weaker dollar to make U.S. exports more competitive. But, as Paul Krugman points out, this is opposed by Republicans who believe continued economic decline will enhance their electoral chances in 2012. Despite investment money pouring into the BRIC countries – Brazil, Russia, India and China – agricultural commodities and precious metals, these markets are too narrow and shallow to form a new asset bubble, such as the ones in tech and housing that fueled economic growth for nearly two decades. And in any case, we know how well those bubbles worked out.

When business investment, consumption, trade, debt and speculation all falter, that leaves government as the only sector that can revive a capitalist economy. But, as I first pointed out in December 2008, the Obama administration knew the stimulus was almost certain to fail because the downturn was sapping a staggering $1 trillion a year from the economy at that point, while the plan offered a relatively meager $787 billion. Of that, only $600 billion of stimulus money was spent in the last two years and, according to Paul Krugman, more than 40 percent of that was in tax breaks that tend to offer the least bang for the buck. So in early 2009, faced with an economy leaking 7 percent of the GDP a year, Obama offers a plan that plugs 1 to 2 percent a year.

In the final equation, the Obama stimulus only covered some of the shortfall in state and local budgets. But that money is drying up, and that, to a large degree, is the reason state services and workers are now under attack.

But now we are in for more bloodletting of social services and government workers because the failed stimulus has legitimized the establishment hysteria over the federal debt. Debt matters but the simplest way to reduce it is by a combination of economic growth and inflation. This is what happened to U.S. debt after WW2, which peaked at about 120 percent of GDP, far more than today even with the economic depression and bailouts. Instead, the right is pushing policies that may result in a worst-case scenario. Cutting spending and taxes –which Obama has endorsed – could lead to further economic contraction and deflation. This will make federal debt payments doubly onerous because tax revenues will shrink as the dollar strengthens.

There is another solution to reviving the economy without piling on debt: tax the wealth of the elite. According to economist Rick Wolff, “high-net-worth” Americans have around $12 trillion in investable assets, which excludes the value of their homes. A 13 percent wealth tax would wipe out the entire 2010 federal budget deficit of $1.56 trillion while doing little to crimp the economy because this money is literally lying around.

Yet Obama never seriously considered even the Keynesian policy of debt-driven financing for national re-industrialization because he was the darling of Wall Street – and number one recipient of its dollars – for his unwavering support of the Bush bailout in September 2008 and by taking counsel from Larry Summers and Tim Geithner during the campaign. Once in the White House Obama shunned jobs programs on a massive enough scale to revive the economy because the indirect method of debt-driven financing would shore up benefits, wages and labor bargaining power, thus cutting into corporate profits, while the direct financing method, taxing the rich, would mean they would have to pay for programs that would eventually cut into their profits.

The Obama administration has consistently fought for policies that involve weakening labor -- such as its attacks on auto workers and teachers and the cynical gesture of calling for a freeze on the pay of federal workers– driving down wages, letting unemployment rise, and squeezing social services and benefits, all to transfer more wealth upward.

The wealthy have profited three times off the crisis: from the bubble itself, during the bailouts and from government bonds sold to them to pay for the bailouts. Putting pensions on the chopping block would give them a fourth opportunity to profit off the same crisis.

If debt is a problem, then bondholders should take a haircut because they took the risk. Of course, that’s not how capitalism works. So, in the case of Social Security, which has nearly $2.6 trillion in its trust fund and can meet ALL obligations through 2037 even assuming no changes are made, the plan is to raid it to pay off bondholders.

That’s why a crisis is being manufactured. Obama’s deal to reduce payroll tax by two percentage points will pilfer an estimated $120 billion from the trust fund that will supposedly be paid back by revenues from the general treasury. This means the deficit will increase, feeding into the fabricated panic over Social Security and debt.

For any country, cutting pensions is disastrous to long-term economic health. In the United States, Social Security accounts for 40 percent of the income of the population over 65 and nearly 50 percent for women in this group. It would also leave more people in the workforce as older workers delay retirement. Because the elderly tend to spend their benefits right away, on housing, food, transportation and medical services this means less demand and lower economic activity. And combining all this with trying to crush public workers also means more unemployed, less tax revenue and a shrinking economy.

It all adds up to a recipe for a depression. Two conclusions are inescapable: Obama is far more Herbert Hoover than FDR, and change will only come from creative independent movements instead of marching into the tomb of the Democratic Party.

Friday, December 17, 2010

The Year in Pills

2010's Hall of Shame

2010 will go down as the year the diet pill Meridia and pain pill Darvon were withdrawn from the market and the heart-attack associated diabetes drug Avandia was severely restricted.

But it was also the year the Justice Department filed the first criminal, not civil, charges against a drug company executive. Lauren Stevens, a former VP and assistant general counsel at GlaxoSmithKline, hid some 1,000 instances of GSK-paid doctors illegally promoting Wellbutrin to other doctors, say authorities.

It was also the year prominent psychiatrists Charles Nemeroff and Alan Schatzberg were accused of writing an entire book for GSK called Recognition and Treatment of Psychiatric Disorders: A Psychopharmacology Handbook for Primary Care.

Here are the drugs which make 2010's Hall of Shame.

Yaz and Yasmin

Soon after Bayer launched the pill Yaz in 2006, billing it as going "beyond birth control," 18-year-olds were coming down with blood clots, gall bladder disease, heart attacks and even strokes. FDA ordered Bayer to run correction ads that detail the drugs' risks though Yaz sales are still brisk. In fact, financial analysts attribute a third quarter slump to a Yaz generic coming online, not dangerous side effects.

Lyrica, Topamax and Lamictal

In August FDA ordered a warning on the seizure drug Lamictal for aseptic meningitis (brain inflammation) but it is still the darling of military and civilian doctors for unapproved pain and migraine uses. All three drugs increase the risk of suicidal thoughts and behaviors according to their mandated labels, in addition to the memory and hair loss patients report.

Humira, Prolia and TNF Blockers

The drug industry's highly promoted biologic drugs are made from genetically engineered hamster cells and suppress the immune system, inviting tuberculosis and several cancers. Yet Humira is advertised to healthy people for "clearer skin" and Prolia is advertised to prevent osteoporosis in healthy women.


After 397 FDA cases of possible psychosis, 227 domestic reports of suicidal behaviors and 28 actual suicides, the government banned pilots, air-traffic controllers and interstate truck and bus drivers from taking the antismoking drug Chantix in 2008. Its neuropsychiatric effects were immortalized when New Bohemians musician Carter Albrecht was shot to death in 2007 in Texas by a neighbor after acting aggressively on the Chantix.


The sleeping pill Ambien was immortalized as the drug Tiger Woods reportedly cavorted with his consorts on and former US Rep. Patrick Kennedy crashed his Ford Mustang on, while driving to Capitol Hill in the middle of the night to "vote" in 2006. Law enforcement officials say it has increased traffic accidents from people who drive in a black out and don't even recognize arresting officers.


Is it a coincidence that Tamoxifen maker AstraZeneca founded Breast Cancer Awareness Month and makes carcinogenic agrochemicals that cause breast cancer? As a breast cancer prevention drug, an American Journal of Medicine study found the average life expectancy increase from Tamoxifen was nine day . Public Citizen says for every case of breast cancer prevented on Tamoxifen there is a life-threatening case of blood clots, stroke or endometrial cancer.

Lipitor and Crestor

Why is Lipitor the best selling drug in the world? Because every adult with high LDL or fear of high LDL is on it. And also 2.8 million children, says Consumer Reports. All statins can cause muscle breakdown called rhabdomyolysis. And Crestor is so linked to the side effect, Public Citizen calls it a Do Not Use and the FDA's David Graham named it one of the five most dangerous drugs before at a Congressional hearing.


Boniva and other bisphosphonate bone drugs are a good example of FDA approving once unapprovable drugs by transferring risk onto the public's shoulders. The list of dangers on the label includes waiting 60 minutes before eating or drinking anything except plain water, never taking the drug with mineral water, sparkling water, coffee, tea, milk, juice or other oral medicine, including calcium, antacids, or vitamins and not lying down after you take it.

Pfizer's hormone drug Prempro is linked to a 26 percent increase in breast cancer, 41 percent increase in strokes, 29 percent increase in heart attacks, 22 percent increase in cardiovascular disease and double the rate of blood clots. But its cognitive and cardiovascular "benefits" are being tested right now at major universities to debut an HT "Light," hoping the public has a short memory.

Prozac, Paxil, Zoloft, SSRIs

Selective serotonin reuptake inhibitor (SSRIs) antidepressants like Prozac, Paxil, Zoloft and Lexapro probably did more to inflate drug industry profits than Viagra. But many say the drugs have also inflated police blotters. In addition to 4,200 published reports of SSRI-related violence, including the Columbine, Red Lake and NIU shootings, SSRIs can cause serotonin syndrome and gastrointestinal bleeding when taken with certain drugs. Paxil is linked to birth defects.

Effexor, Cymbalta, Pristiq, SNRIs

Selective norepinephrine reuptake inhibitors (SNRIs) are like their SSRIs chemical cousins except their norepinephrine effects can modulate pain, which has ushered in your-depression-is-really-pain, your-pain-is-really-depression and other crossover marketing. SNRI's are also harder to quit than SSRIs. 739,000 web sites address "Effexor" and "withdrawal."
Seroquel, Zyprexa, Geodon, atypical antipsychotics

The antipsychotic Seroquel tops 71 drugs on the FDA's January 2010 adverse event report and is linked to unexplained troop deaths and many research scandals. But it's the fifth biggest-selling drug in the world. Atypical antipsychotics cause weight gain and diabetes, the tardive dyskinesia they are marketed to prevent and death in the demented elderly. Yet FDA approved Zyprexa and Seroquel for children last year and the new atypical antipsychotic, Latuda this year. Maybe the FDA is bipolar.

Ritalin, Concerta, Strattera, Adderall and ADHD Drugs

ADHD drugs rob "kids of their right to be kids, their right to grow, their right to experience their full range of emotions, and their right to experience the world in its full hue of colors," says Anatomy of an Epidemic author Robert Whitaker. But they are a gold mine for the drug industry. During an August conference call with financial analysts, Shire specialty pharmaceuticals president Mike Cola lauded the "very dynamic ADHD market," and the "co-administration market" (in which kids don't need one drug but several.

Gardasil and Cervarix Vaccines

A pharma-government plot to inoculate the public with dangerous vaccines? Maybe not but why are governors like Texas' Rick Perry mandating vaccination of girls for HPV? And why was University of Queensland lecturer Andrew Gunn silenced when he questioned the Gardasil vaccine? The HPV vaccine doesn't work for all viral strains, requires a boo$ter and is linked to 56 US girls' deaths as of September, according to the CDC.

Foradil Aerolizer, Serevent Diskus, Advair and Symbicort

Unlike drugs that look safe in trials and develop "safety signals" postmarketing, the long-acting beta agonists (LABA), salmeterol and formoterol, found in many asthma drugs, never looked safe. Studies link them to an increase in asthma deaths, especially in African-Americans and children. They may have contributed to 5,000 deaths said Dr. David Graham at FDA hearings about the controversial asthma drugs.

Singulair and Accolate, leukotriene receptor antagonists

Leukotriene receptor antagonists also never looked safe. Original FDA reviewers said asthma control "deteriorates" on Singulair and it may not be safe in children. Last month, Fox TV reported Singulair, Merck's top selling drug, is suspected of producing aggression, hostility, irritability, anxiety, hallucinations and night-terrors in kids, symptoms that are being diagnosed as ADHD. It is huckstered to parents by the trusted educational service Scholastic, Inc. and the American Academy of Pediatrics.

Putting a Price on Everything

American Exceptionalism

Although there are many (too many to list) superb categories in which the United States is undeniably “exceptional,” there are several important categories where we lag behind the world.

By “lag behind,” we don’t mean the U.S. simply falls a bit short of the leaders; we mean the U.S. is not even on the same page. And by “the world,” we’re not referring to countries like Sweden, Norway, Germany and Switzerland; we’re referring to places like Latvia, Estonia, Guatemala, Honduras, Pakistan and Haiti.

Dr. Jody Heymann is director of the Institute for Health and Social Policy, chairwoman of the Project on Global Working Families, and adjunct professor at the Harvard School of Public Health and Harvard Medical School. Recently, Dr. Heymann and her team put together some statistics comparing America with the rest of the world. Among their findings:
177 nations guarantee paid leave for new mothers; the U.S. does not.
74 nations guarantee paid leave for new fathers; the U.S. does not.*

132 nations guarantee breastfeeding breaks at work; the U.S. does not.

163 nations guarantee paid sick leave; the U.S. does not.

48 nations guarantee paid time off to care for children’s health; the U.S. does not.

41 nations provide leave that can be used for child education needs; the U.S. does not.

33 nations provide paid leave to care for adult family members; the U.S. does not
Clearly, while the overwhelming majority of the world believes that it’s the government’s responsibility and duty to address certain universal macarayphenomena—education, birth, sickness, death—the United States takes a different view. No matter how universal or inevitable the phenomenon, we consider the government’s involvement to be, at best, an unnecessary intrusion, and at worse, a form of socialism.

It’s been said that in the U.S., anything that has a “value” can also be assumed to have a “price.” Put another way, anything that can, in theory, be sold for a profit is considered to be automatically for sale, which illustrates our unshakeable confidence and faith in the virtues of commerce, and helps explain how we got in the fix we’re in.

Not to be coarse or frivolous, but to take the premise to its logical conclusion, it was this impulse that led to pay toilets at the airport. It’s true. If there was going to be a way to make money off something as biologically imperative as a bowel movement, it was going to be an enterprising American who found it.

Arguably, the only free universal program the U.S. has ever had was public education. And while the public school system was once a source of enormous national pride, it is today under attack by privatization hounds dedicated to demonizing and exploiting it with skewed statistics and trumped-up arguments. Seeing private and charter schools as the potential cash cow of the future, they’ve set their sights on jettisoning public education.

Support the Dominant Paradigm

Subverted by the Power Elite

There's a bumper sticker still clinging to the back of my old camper, bearing a phrase you've probably heard before or perhaps even uttered: "Subvert the Dominant Paradigm." At the time I'd placed this on the tailgate for display, it made perfect sense to me. The Dominant Paradigm was the one manufactured by the warmongers, corporateers, securitizers, and mediamen. The rest of us were living in a Subordinate Paradigm, and the path to our salvation lay in tearing down the one imposing itself upon us. Since those halcyon bumper-sticker days, however, I've come to see that this logic is actually inverted, and that in fact WE are the Dominant Paradigm while those ostensibly in charge are the ones who continually attempt to subvert it.

This seems counterintuitive, of course. The world is wired by powerful interests who have propped themselves up by virtue of a nascent "corp d'etat" in which the policies and practices established at the upper echelons serve only to increase their wealth and privilege at the expense of the masses. The billionaires buoy themselves with bailouts, tax breaks, and subsidized boondoggles. They loot the treasury in the name of national security, capitalize on and/or foment dubious threats in order to justify their lockstep control, and interpose Big Brother mechanisms in all spheres of society so as to maintain this ineluctable combination of security and control. Ideologically, they utilize their wholly-owned media subsidiaries and increasingly-regimented school systems to produce a society of dampened consumers with little more on their minds than titillating toys, prescribed pills, and faster faux-food.

Nevertheless, it is increasingly apparent that the forces of subjugation are on the wrong side of history, and are by far a minority class on the planet. They've convinced us that we matter little while their every move is newsworthy. It's a sublime illusion, one that we've been paid a relatively handsome sum (compared to most of history's denizens) to swallow. Over time, it has even come to appear that this stratified state of affairs is the natural order of things, and thus have we generally accepted the rightful status of inherited wealth as a precondition of political power. Democracy has been rendered a quaint exercise in which we are asked to select which robber baron will loot our resources, which moral entrepreneur will pander to us, and which corporate elitist will decide our fates. What makes this openly fascistic enterprise unique in history is precisely its transparent quality and the ways in which it exists alongside popular conceptions of liberty and justice for all. We don't require leaks to expose this blatant corporatocracy; the empire brazenly stands stark naked before our gerrymandered gaze.

Against this state of affairs, people the world over launch rebellions and insurrections of every possible kind. Some openly resist with their bodies, others deploy the power of the pen, still others practice slow-downs and other forms of subtle sabotage, and many raise their voices in response to the myriad injustices delivered on our doorsteps every day. The number of people protesting unconscionable wars, corporate globalization pacts, and other shady deals almost always outstrips the number of those enacting the policies in question. At every turn it is obvious that we are many, and they are few – but the design of the world is a pyramid scheme, where the masses comprising the foundation often feel weak despite shouldering the weight of the freeloading "cloud minders" cavorting in the ether while their wastes trickle down on us.

More than half a century ago, the radical sociologist C. Wright Mills cogently described the workings of this burgeoning "power elite" in terms that in retrospect seem like a feat of gifted insight. Mills depicted a ruling class of military, corporate, and political figures who perpetuate their stations by rendering the citizenry effectively powerless and subject to ready manipulation. Part of the inspiration for his seminal work was a 1942 book called Behemoth that chronicled the Nazis' rise to power, which Mills later said provided him with the "tools to grasp and analyze the entire total structure and as a warning of what could happen in a modern capitalist democracy." The basic thesis of The Power Elite is that a highly unified and centralized elite class has monopolized power, rendered democracy a charade, and coopted the ideologies of both conservatism and liberalism to serve the preordained continuance of their rule. Mills' insights echoed a prior account of these trends by John F. Hylan, New York City mayor, in 1922:

"The real menace of our republic is this invisible government which like a giant octopus sprawls its slimy length over city, State and nation. Like the octopus of real life it operates under cover of a self-created screen. It seizes in its long and powerful tentacles our executive officers, our legislative bodies, our schools, our courts, our newspapers and every agency created for the public protection. It squirms in the jaws of darkness and thus is the better able to clutch the reins of government, secure enactment of the legislation favorable to corrupt business, violate the law with impunity, smother the press and reach into the courts.

"To depart from mere generalizations, let me say that at the head of this octopus are the Rockefeller-Standard Oil interests and a small group of powerful banking houses generally referred to as the international bankers. The little coterie of powerful international bankers virtually run the United States Government for their own selfish purposes. They practically control both parties, write political platforms, make catspaws of party leaders, use the leading men of private organizations and resort to every device to place in nomination for high public office only such candidates as will be amenable to the dictates of corrupt big business. They connive at centralization of government on the theory that a small group of hand-picked, privately controlled individuals in power can be more easily handled than a larger group among whom there will most likely be men sincerely interested in public welfare.

"These international bankers and Rockefeller-Standard Oil interests control the majority of newspapers and magazines in this country. They use the columns of these papers to club into submission or drive out of office public officials who refuse to do the bidding of the powerful corrupt cliques which compose the invisible government. It operates under cover of a self-created screen [and] seizes our executive officers, legislative bodies, schools, courts, newspapers and every agency created for the public protection."
Others have similarly pointed out the hijacked nature of governance and the lockstep union of corporate, political, and military interests – from William Jennings Bryan to Dwight David Eisenhower – and in all of these formulations it is understood that the ruling class is numerically very small, a "little coterie" as Hylan described it. The paradigm in which they operate is a mere fiction plied by a self-perpetuating cadre who claim the mantle of power in order to preempt the exercise of actual power by "the people." Their worldview is designed to insulate their interests from contestation by reinforcing at every turn a sense of resignation among the masses, who are provided with just enough "bread and circuses" to keep their place in the misguided but well-publicized notion that "you can't fight city hall." In this sense, the so-called Dominant Paradigm is actually a wholly contrived and artificially induced version of reality.

The real Dominant Paradigm – the one held by the overwhelming majority of people on the planet – is more decentralized and amorphous, yet is grounded in shared values that merit enunciation. These include: a belief in the virtues of community; a desire to be part of something greater than oneself; a reciprocal relationship with nature and life's essential resources; an aversion to open hostilities and devastating warfare; an interest in the wellbeing of others as a precondition of personal prosperity; an adherence to culturally-transcendent principles such as the Golden Rule; and a willingness to work hard in return for an equitable existence. Remarkably, this truly Dominant Paradigm continues to proliferate despite attempts to manipulate and eradicate it, and despite the fact that its practicability is highly disincentivized in modern life. It is perpetually being subverted by the "power elite" through the interlocking devices of politics, media, education, and economics – and yet it continually emerges from the heart of humanity like green grass poking through the cracks of a lifeless concrete jungle.

At this juncture, the true Dominant Paradigm desperately needs our open encouragement, thoughtful attention, and unconditional support. If humankind is to find its collective way through the storm in a world seemingly gone mad with avarice and despoliation, it will take nothing short of a total paradigm shift – back to the one from whence we came and, by some miracle of persistence in the face of persecution, in many respects have never really abandoned.

Concentrating the Wealth - Death Spiral To Plutocracy

I'm sorry that my main focus on my blogging is this kind of issue with the economy and how it is purposefully being trashed by the wealthy people behind the banks and financial corps, but it really is the defining event of this century so far. It dwarfs 9-11 and both wars as far as its lasting significance.--jef


Obama Aids the Plutocrats

In 2010, an essential moral test of a public policy choice is: Does it further concentrate wealth and power in the hands of a few?

Or does it disperse concentrated wealth and power--and strengthen possibilities for a democratic society with greater equality, improved health and well-being, shared prosperity and ecological sustainability?

Does it move us toward Plutocracy or Peace and Plenty?

Supreme Court Justice Louis Brandeis said, "We can have democracy or concentrated wealth. But we cannot have both."

By the Brandeis Test, President Obama's "tax compromise" fails. By extending the Bush tax cuts for the wealthy and instituting a significantly weakened estate tax, more wealth will flow into the hands of the richest one percent--and within that to richest one-tenth of one percent.

Most of us are aware of President Obama's willingness to trade away his campaign promise to let the tax cuts for high income households expire. This will cost $60 billion next year and an estimated $700 billion if it is permanently extended.

But Obama also backed away from his position on the federal estate tax, which was to freeze it at 2009 levels (wealth exempted to $3.5 million, 45 percent rate). He now supports the Kyl-Lincoln amendment which would raise the exemption to $5 million ($10 million for a couple) and drop the rate to 35 percent. The cost difference between these two measures is at least $100 billion over ten years.

For the last generation, this richest one percent, with some admirable exceptions, has been using its considerable wealth and clout to push for public policy changes that have further concentrated wealth.

We are now in what I could characterize as "Death Spiral To Plutocracy." As wealth concentrates, a hyper-organized segment of this wealth-holder class uses its wealth, privilege and power to change the rules of the economy to further concentrate wealth and privilege.

The logical progression of these policies is a society governed by wealth, a modern high-tech version of the Gilded Age of 1900.

For 30 years, liberal Presidents and Democratic Congress members have cut deals with a growing a bipartisan (mostly Republican Party) Pro-Plutocracy faction. We've won victories for working families--family leave, increased minimum wage, expanded health care, middle class tax cuts--but the price has always been very expensive tax cuts for the wealthy and corporations. Under Clinton and Bush II, you couldn't get anything faintly progressive done without a big bone to the wealthy or corporate class--another capital gains tax cut or corporate loophole.

Such compromises have been central to the Obama political strategy:

  • To get a stimulus package to save the economy, Congress allocates a third of $780 billion for tax breaks to corporations (and still didn't get one GOP vote).
  • To get broader health care coverage for the uninsured, lawmakers surrendered the "public option" that would have forced competition and cut into the power and profits of the health industry cartel.
  • To get a Consumer Financial Protection Bureau included in the June 2010 financial reform bill, lawmakers allowed Wall Street to keep its risky casino operation in place--laying the groundwork for future bubbles, meltdowns and bailouts.

This is a very costly strategy. It diverts trillions of dollars from the Treasury that could be used for long overdue investments in infrastructure, education, energy independence--things that could truly boost the real economy. But worse, it sets up future political battles where the very wealthy and powerful corporations continue to have most of the ammo. In the post "Citizens United" campaign finance environment, this is premeditated surrender.

There are only a few ways to intervene to prevent the "Death Spiral to Plutocracy"--and reverse course. They all require an engaged citizenry to clearly say: "We want an economy that serves everyone, not just the wealthy."

The first intervention is through progressive income, wealth and estate taxes. We urgently need to reinstitute a progressive estate tax. Instead of cutting a deal to institute the Republican estate tax proposal that greatly weakens the law, Congress should press for the Responsible Estate Tax Act which would chip away at concentrated wealth.

The second is through robust campaign finance reform that closes the nexus between wealth and political power. Anything that puts a speed bump between wealth and political influence helps slow the Death Spiral.

The third is to mobilize the silent faction of the wealthy elites that actually see their stake in the common good. Not everyone in the wealth-holding class are actively lobbying to protect their power and privilege. We need a progressive counter-weight to organized defenders of power and privilege. The Wealth for the Common Good network is an inspiring start--with several thousand business leaders and wealthy individuals advocating for policies to broaden prosperity and opportunity. They can counter the deep mythology around wealth creation and deservedness that often justify tax cuts for the wealthy and support the positions of engaged citizens.

Sen. Bernard Sanders is proposing a filibuster against the tax cuts--and he plans to read hundreds of documents about the dangers of extreme inequality in the U.S. Let's all take a similar stand in our own lives--and urge our elected officials to do the same.

Thursday, December 16, 2010

How an Obscure Outfit Called MERS Is Subverting Our Entire System of Property Rights

Banks have scrambled America's system of private property ownership to the point that no one knows who owns what. 
By Yasha Levine, AlterNet
Posted on December 16, 2010

"For the first time in the nation's history, there is no longer an authoritative, public record of who owns land in each county." -- University of Utah law professor Christopher Peterson 
There is an unbelievable scandal in the making that threatens to subvert our four-century-old method for guaranteeing a fundamental building block of the American republic—property ownership. The biggest reason why you probably haven’t heard much about it is that it involves one of the most generic and boring company names imaginable: Mortgage Electronic Registration Systems, Inc., or MERS. It is a story of deception engineered at the highest level of power for short-term gain, and another epic failure of the private sector to uphold the laws and traditions of American society, even something as fundamental as property rights.

Created in 1995 by the country's biggest banks, MERS quietly took control of and privatized mortgage record-keeping across the country and, in the span of a few years, scrambled America's private property ownership records to the point where no one could figure out who owns what. This was no accident, and was done by design: MERS was a tool used by America's top financial institutions to pump up the real estate market. Mortgage-backed securities, robo-signers, lightning quick foreclosures, subprime mortgages and just about everything else that went into feeding the biggest real estate bubble in U.S. history could not function without help from MERS. But unlike many of the Wall Street scandals, this one could blow up in the banks’ faces, with the little guy laughing all the way back to his free McMansion, and local governments seeing their empty coffers fill back up with the billions of dollars in unpaid fees that MERS circumvented.

The story begins in mid-'90s with the founding of MERS, Inc. by the nation's most powerful banks, ostensibly with the aim of streamlining and modernizing the process of registering and tracking mortgages. Traditionally, there has been no centralized registry of real estate ownership information, with counties maintaining their own records for properties within their borders—a system that has remained virtually unchanged since colonial times.

The MERS database went live in the middle of the dot-com bubble, and was supposed take inefficient government bureaucracies kicking and screaming into the future by providing a centralized, national registry of mortgage ownership information. "MERS addresses a problem that was costing the industry a significant amount of money," Rick Amatucci, a Fannie Mae vice president and the agency's liaison with MERS, told Mortgage Banking magazine, just as the new registry went online in 1997. The database would give lenders across the country instant access to real-time mortgage information, diminish potential for fraud, and lower costs for servicers and borrowers, according to Mortgage Banking Association, which was tasked with overseeing the project.

But that kind of talk was just for the press release. The banking industry wasn't concerned with efficiency or transparency or the greater good. It was all about making money, as quickly and cheaply as possible. And that is what MERS was for. It was created to help the industry push its latest money-maker: mortgage-backed securities, a Wall Street financial scam that dressed up the most toxic, guaranteed-to-fail loans as Grade A investment vehicles that could be sold to suckers looking for an easy gain.

But before mortgage-backed securities could be unleashed on the residential housing market on a massive scale, bankers needed to get rid of America's long-standing real estate recording laws, which required lenders to file all mortgage transactions—the origination of a new loan, for instance, or the transfer or sale of a mortgage between banks—with the county in which the property is located. While this recording requirement was not a problem in the sleepy pre-securitization days of the home loan business, when mortgage transactions were kept to a minimum, it was going to be much more difficult—if not impossible—with widespread use of securitization, which jacked up the industry like high-grade meth. Mortgages would be changing hands dozens of times, going from loan originators to banks to Wall Street investment houses, which would collect them by the thousands and package them into complex debt instruments that would be chopped up into shares and sold off to multiple investors all over the world.

Bankers needed a quick, clean way of reassigning mortgages without having to go through the "cumbersome" process of recording them with county courts and recorder offices. But instead of working with municipalities to modernize title registration by a creating a national database that was aboveboard and that everyone could use, the banking industry did what it does best: hid the information with sly accounting tricks.

And it succeeded. In just a few short years, MERS took over the bulk of residential mortgage registration. There are about 80 million residential mortgages in America today, and MERS tracks 60 percent of them.

"[M]ortgage bankers formed a plan to create one shell company that would pretend to own all the mortgages in the country—that way, the mortgage bankers would never have to record assignments since the same company would always 'own' all the mortgages," wrote University of Utah law professor Christopher Peterson, who wrote a key paper on MERS and the mortgage industry.

Here is how the plaintiffs in a class action suit filed in Florida in July 2010 against MERS and a legal firm described the MERS registration system:
The whole purpose of MERS is to allow "servicers" to pretend as if they are someone else: the "owners" of the mortgage, or the real parties in interest. In fact they are not. … With the oversight of Defendant Merscorp and its unknown principals, the MERS artifice and enterprise evolved into an "ultra-fictitious" entity, which can also be understood as a "meta-corporation." To perpetuate the scheme, MERS was and is used in such a way that the average consumer, or even legal professional, can never determine who or what was or is ultimately receiving the benefits of any mortgage payments. The conspirators set about to confuse everyone as to who owned what. They created a truly effective smokescreen which has left the public and most of the judiciary operating "in the dark" through the present time.
The use of MERS as a generic placeholder for the real owner of a mortgage was a crucial component of the entire securitization machine."[T]he entire scheme was predicated upon the fraudulent designation of MERS as the 'beneficiary' under millions of deeds of trust," according to a class action suit filed in Nevada in 2009 against MERS and all the big, crooked banks we’ve learned to fear and hate. "Before MERS, it would not have been possible for mortgages with no market value . . . to be sold at a profit or collateralized and sold as mortgage-backed securities. Before MERS, it would not have been possible for the Defendant banks and AIG to conceal from government regulators the extent of risk of financial losses those entities faced from the predatory origination of residential loans and the fraudulent re-sale and securitization of those otherwise non-marketable loans."

How efficient was MERS at perpetuating trickery in the real estate market? Well, according to statistics published by the U.S. Treasury’s Financial Crime Enforcement Network, from 1997—the year MERS went online—to 2005, mortgage fraud reports increased by 1,411 percent.

The MERS hustle had another benefit: it saved the banking industry—and cost municipal governments—tens of billions of dollars by allowing lenders to avoid paying county filing fees, which cost an average of $30 a pop. According to the AP, if every mortgage tracked by MERS had been resold and re-recorded with a county just one time, the system would have saved the banking industry $2.4 billion in filing fees. In reality, most mortgages are sold and resold a dozen times—sometimes more, which means that MERS extracted at minimum around $30 billion from cash-strapped local governments. "Some counties also use recording fees to fund their court systems, legal aid organizations, low-income housing programs, or schools. In this respect, MERS's role in acting as a mortgagee of record in nominee capacity is simply a tax evasion tool," says Professor Peterson.

But there was one major downside to the scam: because MERS departed from established real estate recording requirements, there was no guarantee that its claim to ownership, if challenged, would be honored by the courts.

Transparent real property registration was one of the earliest—and most important—functions of the American government, a practice that has changed amazingly little since the colonial times. According to "Foreclosure, Subprime Mortgage Lending, and the Mortgage Registration System," American colonists began to enact laws requiring land sales, transfers and mortgages to be entered into the public record with a government agency going back almost 400 years. The Massachusetts Plymouth Bay Colony adopted its first such "recording law" in 1636, which stated that "all sales exchanges giftes mortgages leases or other Conveyances of howses and landes the sale to be acknowledged before the Governor or anyone of the Assistants and committed to publick Record."

By the time the Boston Tea Party rolled around, every English colony had passed laws that required lenders and landowners to enter their names and property and mortgage information into the public record. The reasons for the popularity of the laws are simple and utilitarian: transparent public records of property ownership prevented disputes over who owned what and allowed people to use land as collateral on loans. "The necessity and usefulness of these early public title records is attested to by their nearly universal and uninterrupted force in subsequent American law. Indeed, Pennsylvania's first recording act, first adopted in 1717, remains in force to this day," wrote Peterson. Banks that failed to register mortgage transactions risked losing their ability to enforce the contract. And that is exactly what is on the verge of happening with mortgages registered with MERS.

Dozens of lawsuits all across the country have been filed against MERS and its partners to put this very issue to the test. And while most of them are still ongoing, it's clear that MERS is fighting for its life.

The Wall Street Journal:
Now, critics and homeowners facing foreclosure are increasingly challenging, among other things, MERS' role and legal standing in home foreclosures where it acts as legal representative of the mortgage holder. MERS has fought and won legal challenges in the past. But the nationwide epidemic of foreclosures in the wake of the housing collapse will present it with a wave of challenges unlike any it has seen previously.
Trouble for MERS could add risk to banks by slowing down the securitization process, and creating uncertainty during a time when banks are struggling to reassure shareholders and customers. One hedge fund investor said Friday that questions around MERS are adding to his concerns about banks in the mortgage business and are keeping him from investing in the sector.
While MERS officials say they are confident about their business model, it has become clear that their scheme might very well be on the verge of toppling. On November 17, Congress quietly rammed through a sneaky, vaguely worded bill that would have legalized MERS’ dealings retroactively. And while the bill didn't pass, we can expect Wall Street's lackeys in Congress to continue their efforts. After all, if courts continue to rule against MERS's business model—and it looks like they will—many homes may become foreclosure proof. As Reuters put it: “If court rulings against MERS' authority to foreclose proliferate, many foreclosure cases may be halted indefinitely, and some homeowners in default may end up with clear title to their homes.” Owners will still owe money to banks, but their homes would no longer be counted as collateral on the loan. In short, banks would not be able to kick people out of their homes. And clearly, that is something that America's plutocracy just cannot abide.


So who or what is MERS? How was this little-known corporation able to change nearly 400 years of legal practice in the span of a decade, and do so much damage so quickly? And why did no one blow the whistle?

As a result of the lawsuits being filed against MERS, a lot of previously unknown information about the inner workings of MERS is coming to light.

The people who developed the concept of MERS were connected with Fannie Mae and Freddie Mac, as well as the most corrupt lending institutions in America. People like Brian Hershkowitz, former director of the Mortgage Bankers Association and founder of the association’s technology committee that oversaw the early development of MERS in the early '90s, according to a homeowner-turned-activist-blogger, who is involved in a class action lawsuit against MERS (In 1993, Mortgage Banking magazine referred to this new mortgage resignation system as “New Age Delivery.”)

Hershkowitz was an early tech-booster in the banking industry, heralding a new age where efficiency and profitability would reign supreme. In the early 90s he attributed the success of Countrywide Financial to the fact that it embraced emerging computer technology. "They use technology in ways that give them a competitive advantage and set them apart. They were operating with excess capacity, and now they are putting it to use," Hershkowitz, then-associate director of the Mortgage Bankers Association, told the New York Times in 1991. A few years later he went to work for Countrywide as an executive involved in "areas of strategic planning and executive management." From 1982 to 2003, Countrywide performed like a Ponzi scheme, with shareholders gleefully getting a 23,000.0 percent return on their investment, until the bank collapsed under the weight of its own fraud schemes in 2007.

It seems that MERS has operated along similar lines. According to sworn testimony by various MERS executives, the organization has cycled through four different corporate entities in its brief lifespan. MERS also has almost no paid employees and does not seem to keeps any records or minutes of corporate meetings. When pressed to explain the inner workings of the organization, its executives evaded questions, feigned ignorance and generally acted like provincial mafia bosses on trial—exactly the kind of professionalism one would expect for a company responsible for tracking the ownership information of 50 million mortgages. It was just a couple of guys sitting around, chatting, smoking…and making sure not to leave any evidence behind. No wonder county officials who blew the whistle on MERS early on were squashed.

Edward Romaine, a Republican recorder of deeds for New York's Suffolk County, was one of the few officials who tried to refuse to take filings from MERS. "He argued that not only would the county lose out on fees—$1 million in one year alone—but that MERS failed to even maintain a clear chain of title on a property. He got backing from New York's attorney general," reported the Associated Press. MERS sued Suffolk County and took the case all the way up to the state's highest court, where it won on appeal in 2007. The court forced the county to accept MERS filings because the county lacked the statutory authority. Put another way, the court forced a municipal government to do business with a criminal organization, despite objections from county officials.

MERS cost local governments billions of dollars in lost revenue, but there is a chance that the cash-strapped counties will be able to claw some of that money back. Lawsuits have been filed against MERS in California, Nevada, Tennessee and 14 other states that accuse the company of functioning as a tax evasion vehicle designed to help banks circumvent filing fee requirements. “In California, the suit against MERS could cost the company somewhere between $60 to $120 billion in damages and penalties. With so much money extracted from California's municipalities, no wonder the Golden State is facing a $25 billion budget gap,” reported the Associated Press.

We're constantly being told that liberalization, deregulation and privatization automatically equal greater freedom and increased efficiency. But MERS provides us with a different narrative, one in which the government works perfectly well, when not corrupted by corporations who want to use it to loot public wealth.

Will Obama Sell Us Out on Social Security?The Political Fallout Would Be Devastating!

Obama has signaled that he might include Social Security cuts as part of a grand deficit-reduction deal. If that occurs, expect civil war among the Democrats.
By Robert Kuttner, Huffington Post
Posted on December 16, 2010

If you think the Democratic base is mad at Obama now for making a craven deal with Republicans that continues tax breaks for the richest Americans and adds new ones for their heirs through a big cut in the estate tax, just wait a few weeks until Obama caves on Social Security.

How will this occur? The deficit commission appointed by the President has called for an increase in the retirement age, as well as other cuts in benefits over time. And the deal that Obama made with the Republicans just gave deficit hawks new ammunition by increasing the projected deficit by nearly $900 billion over a decade. Social Security will be in the cross-hairs.

The deficit commission has tried to camouflage these cuts by emphasizing that Social Security benefits for the very poor would not be reduced, and might even be increased. But in the commission's proposal, the cuts would affect middle-class retirees. Larry Summers, who is stepping down as Obama's economic chief, has refused to rule out cuts.

Social Security has also been softened up by the element of the tax deal that temporarily cuts payroll taxes. Supposedly, the trust funds will be made whole by a transfer from general government funds. But this increases the deficit.

So Obama has created a kind of pincer attack on Social Security. One arm is the deficit commission, which has created the blueprint. The other is the tax-cut deal, which increases the deficit, adding to the artificial hysteria that Social Security is going broke. Meanwhile, the right is playing a very cute game, congratulating Obama for the deal. According to columnist Charles Krauthammer, writing in Friday's Washington Post, "Barack Obama won the great tax-cut showdown of 2010." Really? How did he do that? It sure looked like he got rolled. "The President negotiated the biggest stimulus in American history, larger than the 814 $billion 2009 stimulus package."

The New York Times' resident right-wing pundit, David Brooks, also writing Friday, was peddling the same line:

"The fact is, Obama and the Democrats have had an excellent week," Brooks wrote. "The White House negotiators did an outstanding job for their side."

When the right congratulates Obama for winning, you know he is losing. For starters, the proposed compromise isn't much of an economic stimulus. If the deal passes Congress, taxpayers will be paying the same income tax rates in 2011 and 2012 as in 2010. No stimulus there.

The only real stimulus is the temporary cut in Social Security taxes, the extension of unemployment insurance plus a few minor tax breaks for regular people, totaling about $200 billion. That's a little more than one percent of a $15 trillion economy. Pretty puny, certainly a lot smaller than the inadequate stimulus of February 2009 when the recession was only beginning to deepen.

Except for the extension of unemployment insurance, which should be done out of common decency, most of the "stimulus" is pure Republican ideology -- stimulate the economy by cutting taxes. If that had worked, the huge tax cuts of the Bush years would have kept the economy out of recession.

There is not a nickel of public investment or direct job creation in this proposed deal. And it is well recognized by economists that in a recession, temporary tax cuts, especially tax cuts tilted to the rich, provide far less bang for the buck than public investment.

If Obama had fought for a deal that restored Clinton-era tax rates on the richest two percent of the population, and used the revenue for direct investment and job creation, that would have been a stimulus worth celebrating. And doubtless, commentators like Krauthammer and Brooks would be condemning it.

Because the Congressional Budget Office assumed that all the Bush tax cuts would expire on December 31, 2010, the tax-cut deal creates a new budgetary reality. Suddenly, the ten-year deficit will be almost $900 billion larger than projected.

This, in turn, will give new ammunition to the deficit hawks. And here is where Obama has set up Social Security to take the hit, unless he drastically shifts ground.

The supposed crisis of Social Security is a phony. Social Security is financed by payroll taxes. Reduce unemployment, increase wages, and the crisis disappears. Even with only modestly better unemployment rates and wage growth, the modest projected shortfall could be eliminated by eliminating the cap on income subject to tax.

A Democratic president with strong progressive principles and political nerve would have taken his party into the mid-term election pledging never to cut Social Security and daring Republicans to take a similar pledge. Instead, Obama appointed a deficit commission with a majority of appointees wanting to cut the Democrats' signature program -- thus blurring party differences on the Democrats' biggest political winner.

Obama also signaled Democrats in Congress that he might well include Social Security cuts as part of a grand deficit-reduction deal. If that occurs, the civil war in the Democratic Party will only deepen.

Coda: The other day, I was part of a conversation in which the question came up: If Democrats in Congress do hold their noses and vote for the tax-cut deal in order to prevent unemployment benefits from being cut off on Christmas, what might they ask of Obama in return? There is not a great deal that he can deliver legislatively, unless he decides to get serious about wielding his veto pen.

The best idea to emerge was this: Democrats should demand, in return for their aye votes, that Obama appoint Elizabeth Warren to chair the National Economic Council, to succeed the departing Larry Summers. Warren is the one senior administration official who has not stopped fighting to protect regular Americans. She is not a Ph.D economist, but neither was the man for whom the Council was created, its first head, Robert Rubin. Nor was Rubin's successor, Gene Sperling.

According to press reports, the man about to get the job is Roger Altman, an investment banker and former deputy to Rubin. Altman has been to the White House at least three times in recent weeks, and his appointment seems all teed up. Altman would continue the Wall Street dynasty around Obama -- the very gang whose reckless deregulation and speculation brought us the economic collapse whose damage is now being used to justify wrecking Social Security.

Getting Warren instead of Altman would almost justify voting for this stinker of a tax deal. Maybe Warren could even get Obama to think twice about the political and economic wisdom of throwing Social Security on the pyre of deficit reduction.

Austin's Airport Advisory Commission Opposes ABIA Body Scanners

(Way to go, Austin!--jef)


TSA hopeful scanners in place sometime in 2011

by Josh Hinkle
Tuesday, 14 Dec 2010, 10:24 PM CST

AUSTIN (KXAN) - Austin's Airport Advisory Commission approved a resolution on Tuesday night advising the city council to oppose airport body scanners and invasive body searches.

The Transportation Security Administration said it is hopeful advanced imaging technology or “body scanners” will be in the Austin-Bergstrom International Airport sometime next year. Already, March has been thrown out as a possibility, though the TSA said it would likely be late 2011 or even 2012.

"I think people in the United States area little bit spoiled, I think, to quick travel and having everything instantaneous,” said Paula Tye, on her way to a flight to Orlando.

Tye flies out of Austin on business every three weeks to many cities that already have body scanners for extra security. The TSA said 70 airports already have the devices.

"It's like an upright tanning bed actually,” Tye said. “They just scan you, and it really takes two seconds. It's not very long at all. You step out and you're done."

Along with radiation concerns, critics said the machines don't work as well as proponents would like. There are also groups like Texans for Accountable Government saying it is an invasion of privacy.

"What we need to do is let them know it is not acceptable in Austin,” said TAG’s Heather Fazio. We don't have body scanners here. We don't want body scanners here. We don't need them here."

That group was among many people testifying before the commission, trying to convince members to oppose the scanners. In the past, TAG has put up privacy fights against the APD blood draw program, private data concerns at Austin's Fusion Center, and even accountability for toll roads.

Beyond the commission, TAG is planning to meet with Austin City Council members on Friday to further discuss the issue. The group is also planning a protest in the airport terminal on Saturday.

Tye said people who do not like the scanners might just have to live with them. Regardless of any resolutions passed by the commission or city Council, the TSA has the final say.
"I like to think it makes things safer, so we do all we can do. And I hope that's enough,” Tye said.
ABIA has not yet received the scanners, because some thought they might be too heavy for the floors there. The TSA said a new report, set for release next month, shows the machines are actually lighter than originally thought.

Inside TSA scanners: How terahertz waves tear apart human DNA

by Terrence Aym - 12-15-10

While the application of scientific knowledge creates technology, sometimes the technology is later redefined by science. Such is the case with terahertz (THz) radiation, the energy waves that drive the technology of the TSA: back scatter airport scanners.

Emerging THz technological applications

THz waves are found between microwaves and infrared on the electromagnetic spectrum. This type of radiation was chosen for security devices because it can penetrate matter such as clothing, wood, paper and other porous material that's non-conducting.

This type of radiation seems less threatening because it doesn't penetrate deeply into the body and is believed to be harmless to both people and animals.

THz waves may have applications beyond security devices. Research has been done to determine the feasibility of using the radiation to detect tumors underneath the skin and for analyzing the chemical properties of various materials and compounds. The potential marketplace for THz driven technological applications may generate many billions of dollars in revenue.

Because of the potential profits, intense research on THz waves and applications has mushroomed over the last decade.

Health risks

The past several years the possible health risks from cumulative exposure to THz waves was mostly dismissed. Experts pointed to THz photons and explained that they are not strong enough to ionize atoms or molecules; nor are they able to break the chains of chemical bonds. They assert—and it is true—that while higher energy photons like ultraviolet rays and X-rays are harmful, the lower energy ones like terahertz waves are basically harmless. []

While that is true, there are other biophysics at work. Some studies have shown that THZ can cause great genetic harm, while other similar studies have shown no such evidence of deleterious affects.

Boian Alexandrov at the Center for Nonlinear Studies at Los Alamos National Laboratory in New Mexico recently published an abstract with colleagues, "DNA Breathing Dynamics in the Presence of a Terahertz Field" that reveals very disturbing—even shocking—evidence that the THz waves generated by TSA scanners is significantly damaging the DNA of the people being directed through the machines, and the TSA workers that are in close proximity to the scanners throughout their workday.

From the abstracts own synopsis:

"We consider the influence of a terahertz field on the breathing dynamics of double-stranded DNA. We model the spontaneous formation of spatially localized openings of a damped and driven DNA chain, and find that linear instabilities lead to dynamic dimerization, while true local strand separations require a threshold amplitude mechanism. Based on our results we argue that a specific terahertz radiation exposure may significantly affect the natural dynamics of DNA, and thereby influence intricate molecular processes involved in gene expression and DNA replication."

In layman's terms what Alexandrov and his team discovered is that the resonant effects of the THz waves bombarding humans unzips the double-stranded DNA molecule. This ripping apart of the twisted chain of DNA creates bubbles between the genes that can interfere with the processes of life itself: normal DNA replication and critical gene expression.

Other studies have not discovered this deadly effect on the DNA because the research only investigated ordinary resonant effects.

Nonlinear resonance, however, is capable of such damage and this sheds light on the genotoxic effects inherent in the utilization of THz waves upon living tissue. The team emphasizes in their abstract that the effects are probabilistic rather than deterministic.

Unfortunately, DNA damage is not limited only to THz wave exposure. Other research has been done that reveals lower frequency microwaves used by cell phones and Wi-Fi cause some harm to DNA over time as well. ["Single- and double-strand DNA breaks in rat brain cells after acute exposure to radiofrequency electromagnetic radiation."]

The Good Jobs Are Being Shipped Out Of America As Part Of Globalism

Need A Job? Too Bad! 
By Michael Snyder - Published on 12-16-2010

I hope that you enjoy the cheap foreign-made plastic trinkets that you will be exchanging with your family and friends this holiday season, because they are literally destroying the U.S.economy.  As part of the new "one world economy" that both Democrats and Republicans insist is so good for us, millions of good paying middle class jobs have been shipped out of America.  Do you need a job?  Are you wondering where all the good jobs went?  Well, the next time you are out just walk into a store and start looking at the product labels.  Most of the things that are sold in our stores are now made out of the country.  So if you need a good paying job to support your family that is just too bad - you have been merged into a global labor pool where you must compete for jobs with people on the other side of the globe willing to work for less than a tenth of what you usually make.  Welcome to the "one world economy" where big global corporations make a fortune exploiting slave labor on the other side of the world while "overly expensive American workers" get dumped out on the street.

Are you in favor of a redistribution of wealth?  Most of the time when the phrase "redistribution of wealth" is brought up, conservatives and libertarians visibly cringe - as they should.  But did you know that right now the greatest redistribution of wealth in the history of the world is taking place and our politicians are doing nothing about it?

For a moment, imagine a giant map of the world.  On that giant map, put a huge pile of money on the United States, and also put a huge pile of money on China and on the OPEC nations.  Now imagine a big hand coming along once a month that takes tens of billions of dollars out of the U.S. pile and puts it into the piles of China and the OPEC nations.

As this continues month after month after month, what is eventually going to happen?
The U.S. pile of money is going to get far smaller and the other piles of money are going to get much, much larger.

And that is exactly what is happening in our world today.

Back in 1985, the U.S. trade deficit with China was 6 million dollars for the entire year - not really anything to worry about  it.

Well, let's fast forward to 2010.  For the month of August alone, the trade deficit with China was more than 28 billion (that's billion with a "b") dollars.

In other words, the U.S. trade deficit with China in August was more than 4,600 times larger than the U.S. trade deficit with China was for the entire year of 1985.

My, how the world has changed in 25 years.

Oh, but doesn't China "invest" some of that money they are getting from us back into our country?

Well yeah, our top officials regularly go over there to beg them to lend us more money.  Now we owe China close to a trillion dollars.  We also owe the major oil exporting nations of the Middle East massive amounts of money.

Is this a good idea?  Let us keep in mind the ancient principle that the borrower always ends up the servant of the lender.

Is it wise for the United States to become enslaved to China and to the oil exporters of the Middle East?

Is that any way to run an economy?  Is that any way to run a country?

All over the United States factories are closing down.  If you go to shopping centers in many areas of America you would think that the hottest new store was called "Space Available".
Since the year 2000, we have lost 10% of our middle class jobs.  In the year 2000 there were about 72 million middle class jobs in the United States but today there are only about 65 million middle class jobs.

What kind of progress is that?

"But oh", the supporters of the one world economy will declare, "the cheap goods, the cheap goods!"

Yes, I hope you enjoy paying ten percent less for your plastic trinkets.  But you will also support American workers one way or another.  Either you will provide them with good paying jobs, or you will pay for their food stamps and their unemployment checks.

One out of every six Americans is now enrolled in a federal anti-poverty program.  As 2007 began, 26 million Americans were on food stamps, but now 42 million Americans are on food stamps and that number keeps rising every single month.

Can anyone out there please explain how the "one world economy" is supposed to be good for us when 42 million Americans cannot even feed themselves?

Allowing our country to be deindustrialized just so that we can consume more cheap goods from China is like tearing down pieces of your house to keep your fire going.  In the end, you won't have much of a house left.

Whatever your opinion of Donald Trump is, this next video is worth watching.  Trump certainly should not run for president, but as a savvy businessman he definitely understands what China is doing to us....

Stockman: A Leveraged Buy-out of the American Economy

Published on 12-16-2010  - Source: Zero Hedge

After recently debunking the economic “recovery’s” flagrantly misrepresented employment data, the OMB’s David Stockman makes a third appearance in as many months (previously here and here), this time on Dylan Ratigan. And as always, it is a must see: key soundbite: “We have had a Fed engineered serial bubble, that has created the appearance of wealth, that has caused people to consume beyond their means through borrowing, and that has flushed the income and wealth of our society up to the top, as a result of the Fed turning the financial markets into a casino. These are pure casinos, they are not capital markets, they are not adding to the productive capacity of our economy, they simply are a bunch of robots trading with each other by the millisecond as a result of the Fed giving them zero cost overnight money, and giving them all kinds of hand signals on what to front-run.” It is almost as if Stockman reads Zero Hedge… And he continues: “The Fed is destroying prosperity by funding demand that we can’t support with earnings and productions, causing massive current accounts deficits and the flow of funds overseas and the build up in China, OPEC and Korea of massive dollar reserves which is a totally unsustainable, unsupportable system, and we are coming near the edge of where that can continue to remain stable.” Ironically, Stockman is spot one when he notes that America incurred enough debt to have effectively LBOed itself. The net result, as every PE principal knows all too well, is a husk of an entity, whose most valuable assets have been bled dry. At this point, the last straw for America will be the inevitable rise in interest rates (at some point over the next five years, the Fed and Treasury will have to sell a combined $5 trillion in debt – that alone will destroy the supply/demand equilibrium and send rates surging) which will result in either debt repudiation or outright bankruptcy. The only good outcome is that the great experiment of LBOing America by the kleptocratic elite is coming to its sad conclusion.

Some other facts:
• In 2000, there were 72 million middle-class jobs: manufacturing, construction, FIRE, transportation, etc; today, there are 65 million jobs, we have lost 10% of our middle class supporting jobs. We have replaced these with part-time jobs.
• In 1981 the national debt was $1 trillion. Today, it is $14 trillion. The economy in the same period is 3.5-4 times bigger, the national debt is 14 times bigger.
• Booby-trapping the 2012 election with a the latest set of tax-cuts that expire just days ahead, will panic the White House into doing the wrong decision for the economy once again in another political trade off that delays the inevitable collapse.

Science of man-made life can proceed: White House

By Kerry Sheridan (AFP)

WASHINGTON — The White House on Thursday said the controversial field of synthetic biology, or manipulating the DNA of organisms to forge new life forms, poses limited risks and should be allowed to proceed.

An expert panel convened by President Barack Obama advised vigilance and self-regulation as scientists seek ways to create new organisms that could spark useful innovations in clean energy, pollution control and medicine.

The Presidential Commission for the Study of Bioethical Issues "concluded that synthetic biology is capable of significant but limited achievements posing limited risks," it said in its first report.

"Future developments may raise further objections, but the Commission found no reason to endorse additional federal regulations or a moratorium on work in this field at this time."

The 13-member panel of scientists, ethicists and public policy experts was created by Obama last year.

Its first order of business was to consider the issue of synthetic biology after the J. Craig Venter Institute announced in May it had developed the first self-replicating bacteria cell controlled by a synthetic genome.

Critics said the discovery was tantamount to "playing God," creating organisms without adequate understanding the ramifications, and upsetting the natural order.

Announcing the creation of the "first synthetic cell," lead researcher Craig Venter said at the time it "certainly changed my views of the definitions of life and how life works."

But the commission said Venter's team had not actually created life, since the work mainly involved altering an already existing life form.

"Thoughtful deliberation about the meaning of this achievement was impossible in the hours that elapsed between the breaking news and the initial round of commentaries that ensued," it said in its report.

"Of note, many scientists observe that this achievement is not tantamount to 'creating life' in a scientific sense because the research required a functioning, naturally occurring host cell to accept the synthesized genome."

Commission chair Amy Gutmann said the panel considered a range of approaches to regulating the new scientific field, from allowing unbridled freedom to imposing strict government regulation on experiments.

"We chose a middle course to maximize public benefits while also safeguarding against risks," she said.

"Prudent vigilance suggests that federal oversight is needed and can be exercised in a way that is consistent with scientific progress."

As to the risk of releasing modified organisms into nature, a scenario some have warned could spark biological threats or damage to the ecosystem, "scientists and ethicists advised careful monitoring and review of the research," the panel said.

The panel also urged greater cooperation among federal agencies that oversee product licensing and funding of synthetic biology, and collaboration with world governments and global groups like the World Health Organization.

"Educational classes on the ethical dilemmas raised by synthetic biology should be a mandatory part of training for young researchers, engineers, and others who work in this emerging field," it added.

Los Angeles public schools open doors to ‘corporate brand identity’

(Wow, I'm almost afraid to check out how this works out in a few years.--jef)

This algebraic equation, brought to you by Coca-Cola?

corporatelogos Los Angeles public schools open doors to corporate brand identityBy Stephen C. Webster
Thursday, December 16th, 2010 

Absurd as it may sound, that will soon be a figurative reality for many students in Los Angeles county, as public school officials there have announced a plan to solicit corporate sponsorship to help grow their budgets and retain staff.

In a unanimous vote, the board decided yesterday to allow "corporate brand identity" proliferation throughout the facilities of the Los Angeles Unified School District. The district's policy would allow corporate donors to earmark what programs they'd like their money to support, be they sports, arts or academic.

While not the first school district to do so, Los Angeles is certainly the largest, according to The New York Times. The move comes amid one of the state's worst budget crises ever.

The discussion of private money being diverted to aid public schools is not a new one and is not without controversy, but there are reasonable advocates on both sides of the issue.

When two Sheboygan, Wisconsin high schools changed the names of their cafeteria kitchens to "the Kohler Credit Union kitchens" in 2006, critics lined up to attack the plan as indicative of America's social decline. But the schools took in $45,000 for the re-namings, according to USA Today, and promptly put the cafeterias up for sponsorship next at $300,000 apiece.

That translated into more teachers, higher salaries and newer books, supporters said.
Similar words were echoed by Los Angeles school board members, according to the Times.
"This is really our way to be responsive to that reality; we need to look for other sources of revenue," Melissa Infusino, the district's partnerships director, was quoted as saying. "As uncomfortable as it may be for folks, it’s less comfortable to get rid of programs or go through more layoffs."

The board also agreed to shorter summers, with students leaving classes on June 1 and starting again on Aug. 15.

Los Angeles public schools served nearly 700,000 students in the 2007-2008 season, according to district figures.

Pope calls Christians the most persecuted

(What a fraud! Who is persecuting christians? They have all the power and wealth for crying out loud! He looks like a lizard.--jef)

Pope calls Christians the most persecuted
By The Associated Press
Thursday, December 16th, 2010

Pope laments religious persecution as threat to world peace, says Christians suffer most

Pope Benedict XVI singled out Christians as the religious group that suffers from the most persecution on Thursday, denouncing lack of freedom of worship as an "intolerable" threat to world security.

The message reflected a pressing concern by Benedict in recent months for the plight of Christian minorities in parts of the world, especially in the Middle East.

"Sadly, the year now ending has again been marked by persecution, discrimination, terrible acts of violence and religious intolerance," Benedict lamented in the message for World Peace Day, celebrated by the church on Jan. 1, but traditionally released in advance

He wrote that he was especially thinking of Iraq ",which continues to be a theater of violence and strife" as it aims for stability and reconciliation.

Benedict singled out the "reprehensible attack" on a Baghdad cathedral during Mass in October, killing two priests and more than 50 other worshippers, as well as attacks on private homes that "spread fear within the Christian community and (create) a desire on the part of many to emigrate in search of a better life."

The Vatican voiced concerns that the steadily flight of Christians from Iraq will effectively eliminate the ancient community there.

"At present, Christians are the religious group which suffers most from persecution on account of its faith," the pontiff asserted, and cited Christian communities suffering from violence and intolerance particularly in Asia, Africa, the Middle East and the Holy Land.

"This situation is intolerable, since it represents an insult to God and to human dignity" as well as "a threat to security and peace," Benedict wrote in one of the 17-page-long message's strongest passages.

He appealed to authorities to "act promptly to end every injustice" against Christians.

Benedict didn't cite countries, but in past years church officials have lamented that Christians — most of them migrant workers — are forbidden to worship in Saudi Arabia.

He blasted what he called "more sophisticated forms of hostility to religion, which, in Western countries, occasionally find expression in a denial of history and the rejection of religious symbols which reflect the identity and the culture of the majority of its citizens."

Benedict has been continuing a campaign launched by his predecessor, the late John Paul II, to reinvigorate Europe's "Christian roots."

The Vatican has criticized initiatives in some Western countries to ban crucifixes from public places, ranging from classrooms to courtrooms, including in predominantly Catholic Italy.

Espionage Act endangers First Amendment rights, ACLU warns

By Eric W. Dolan - Thursday, December 16th, 2010

Applying the US Espionage Act to third-party publishers of classified information like WikiLeaks would violate protected speech rights, the American Civil Liberties Union (ACLU) told members of the House Judiciary Committee Thursday.

"If the Espionage Act were to be applied to publishers, it would have the unconstitutional effect of infringing on the constitutionally protected speech rights of all Americans, and it would have a particularly negative effect on investigative journalism – a necessary and fundamental part of our democracy," the ACLU said in a statement (.pdf).

"In the current environment, it would be all too easy for inflamed public passions to serve as the basis for arguments to justify broadening even further the proscriptions of the law. Instead, Congress should stand clear-eyed and firm against arguments based on passion, not reason – and narrow the Espionage Act to those who leak properly classified information."

"[W]e urge Congress to resist the urge to broaden the Espionage Act's already overbroad proscriptions and, instead, to narrow the Act’s focus to those responsible for leaking properly classified information to the detriment of our national security," they continued. "Publishers who are not involved in the leaking of classified information should be praised by our society for their contributions to public discourse, not vilified as the co-conspirators of leakers with whom they have no criminal connection."

Government documents are too easy to classify, which has resulted in the classification of thousands of documents that pose no real risk to national security if released, according to the ACLU.

"Documents that are unnecessarily classified under such a system have the effect of grossly expanding the penalties of the Espionage Act to the release and publication of documents having purely innocuous content – but which happen to be designated as secret."

The ACLU urged Congress to amend the Espionage Act by removing all references to "publication" from the legislation and to improve the current classification system.

The committee's Thursday hearing on "the Espionage Act and the Legal and Constitutional Issues Raised by WikiLeaks" included a number of legal scholars and attorneys, including Ralph Nader.

Benjamin Wittes, a senior fellow in Governance Studies at The Brookings Institution, warned Monday that applying the Espionage Act to WikiLeaks founder Julian Assange could make "felons of us all."

Under the Act, anyone "having unauthorized possession of" information relating to the national defense, or information that could be "used to the injury of the United States or to the advantage of any foreign nation" may be prosecuted if he or she publishes it or "willfully retains" it.

"By its terms, it criminalizes not merely the disclosure of national defense information by organizations such as Wikileaks, but also the reporting on that information by countless news organizations," Wittes wrote on his blog. "It also criminalizes all casual discussions of such disclosures by persons not authorized to receive them to other persons not authorized to receive them–in other words, all tweets sending around those countless news stories, all blogging on them, and all dinner party conversations about their contents."

The State Department has argued that Assange is not "journalist" or "whistleblower," but a "political actor" with his own agenda.

Mercury Dental Fillings Might be Bad for You After All

(Gee, ya think?--jef)

By Jeff Neuman - Dec 16, 2010

Last year, the FDA released a report that said mercury fillings are totally harmless when lodged into your head forever. But yesterday, an advisory committee told the FDA to look at new data that might suggest otherwise. Go figure.

The committee, which met with various experts, was quick to state that the FDA was not at fault and that their judgement was sound based on the evidence provided them for last year's research. In its report last year, the FDA stated:
While elemental mercury has been associated with adverse health effects at high exposures, the levels released by dental amalgam fillings are not high enough to cause harm in patients.
But now, experts claim that the mercury in amalgam fillings can seep out from teeth and into the brain, and even kidneys and bones. Many people testified before the committee, both for and against the use of mercury in fillings. Some of those who testified claimed miscarriages, paralysis and memory loss were due to mercury poisoning. One dentist, Dr. Stephen Markus, asked, "I always wondered why we were told by the (American Dental Association) to be careful when disposing of mercury. If it's so dangerous to the environment, why not my patients?" That's a damn good point.

The committee suggested that the FDA change the way it studies the effects of mercury vapor exposure, and that patients and dentists should have more information available to them. And really, there's a simple fix for all of this: They just need to speed up the development of tooth regeneration gel, and we won't have to worry about this ever again.