Friday, March 15, 2013

Penis Snatching on the Rise in Africa

Africa’s Genital-Stealing Crime Wave Hits the Countryside - All part of an illicit and lucrative trade in organs. 
By Louisa Lombard | Pacific Standard 

March 14, 2013 | Elaborate greetings are the norm, I’ve found, when one enters a Central African village. So it was a surprise when I noticed that many people weren’t shaking hands the morning I arrived in Tiringoulou, a town of about 2,000 people in one of the remotest corners of the Central African Republic, in March 2010. I soon found out the reason: the day before, a traveler passing through town on a Sudanese merchant truck had, with a simple handshake, removed two men’s penises.

As best I could reconstruct from witness accounts, the stranger had stopped to purchase a cup of tea at the market. After handing over his money, he clasped the vendor’s hand. The tea seller felt an electric tingling course through his body and immediately sensed that his penis had shrunk to a size smaller than that of a baby’s. His yells quickly drew a crowd. Somehow in the fray a second man fell victim as well.

Hearing all this, I was less shocked than intrigued. As an anthropologist who studies the region, I was familiar with the problem of penis snatching. What surprised me was that the phenomenon—or, depending on your perspective, the rumor—had made it as far as Tiringoulou.

Reports of genital theft have spread like an epidemic across West and Central Africa over the past two decades, in tandem with what appears to be a general resurgence of witchcraft on the continent. Anthropologists have explained this rise as a response to an increasingly mystifying and capricious global economy. Which is to say that when the workings of capital are as genuinely obscure as they are in today’s Africa, proceeding behind a veil of complexity and corruption, rumors of “occult economies”—often involving a trade in human organs—offer a less mystifying explanation for the radical disparities in wealth on display.

That said, genital theft is neither new nor confined to Africa. Similar panics afflicted Central Europe in the 15th and 16th centuries. (Malleus Maleficarum  a book-length jeremiad against the dangers of witchcraft from 1486, includes a discussion of sorceresses who “take away male members” and keep them in birds’ nests.) And in 1967, an outbreak of koro—the belief that the penis is retracting into the body—overwhelmed hospitals in Singapore.

In Africa today, scholars who study penis snatching understand it mainly as an urban phenomenon—an extreme expression of the anxieties that pervade a city when villagers become urbanites en masse, living among throngs of unfamiliar people. That’s because most cases have been reported in crowded spots like Lagos, in Nigeria, and Douala, in Cameroon. But here I was in Tiringoulou—a dusty, peanut-growing hamlet so small and poor it barely has a market. If penis snatching had previously been a city dweller’s fear, now it seemed that not even the remotest places would be spared.

But spared from what, exactly?

It’s fair to say there are victims on both sides of the penis-snatching equation.

Shortly after the disturbance in the Tiringoulou market, members of the armed rebel group that governs the town arrested the traveler and subjected him to a harsh interrogation—for his own protection, they told me later. Had they left him to the mob, the town’s women would have torn the stranger limb from limb, they reasoned. But the protection, such as it was, did not last long: the supposed thief was executed by gunshot later that day. (Aware that international law frowns on summary execution, the rebel commander who oversaw the execution relayed a different version of events: he said the thief had mysteriously vanished from his holding cell.)

As for the men whose penises were stolen, several eyewitnesses assured me that the appendages did indeed shrink dramatically. I can’t offer such an intimate eyewitness account myself, but I did visit one of the men at his home, and he clearly seemed to be suffering. He lay propped on one elbow, slack and listless in loose sweatpants, on a woven mat in the shade outside his house. A handful of friends kept him company. Over cups of sweet tea, I asked them about how they understood the recent events.

Penis snatching, they said, was a means of supplying an illicit and lucrative trade in organs. Cameroonians and Nigerians—people from places “where they have multistory buildings”—were seen as particularly well versed in the business. “You see how advanced Cameroon is?” someone said. “It’s because they are so strong in commerce of all kinds, including in genitals and scalps.” The stolen organs, my companions said, are sold to occult healers for use in ceremonies, or else they are quickly fenced back to victims of penis snatching for a price. But the real money was to be made in Europe. One man who had spent some time living in Cameroon said he had heard of a woman there who was nabbed by airport security while trying to smuggle several penises to the Continent inside a baguette.

I asked the town doctor what he thought. Could he help the victims? He shook his head slowly—as if trying to gauge how much I believed about the whole affair—and then responded, “Western medicine is no match for this magic. It is a mysterious thing.”

Mysterious indeed. But perhaps no more so than certain afflictions that are less strange to us in the West. If penis stealing seems beyond-the-pale weird, consider what people in Tiringoulou might think upon hearing of Americans who starve themselves near to death because their reflection in the mirror convinces them they are fat. 

Will J.P. Morgan Chase Be Torn a New One?


by Matt Taibbi
 
Beginning at 9:30 a.m. Friday, I live-blogged a hearing held by Senator Carl Levin's Permanent Subcommittee on Investigations – the best crew of high-end detectives this side of The Wire, in my opinion – who will be grilling J.P. Morgan Chase executives and high-ranking federal regulators in a get-together entitled, "J.P. Morgan Chase "Whale" Trades: A Case History Of Derivatives Risks And Abuses." This follows this afternoon's release of a brutal 301-page report commissioned by Levin and Republican John McCain by the same name.

The Subcommittee investigators, largely the same crew who unraveled financial scandals surrounding infamous Goldman Sachs trades like Abacus and Timberwolf, and also took on HSBC's trans-global money-laundering activities in an extraordinarily detailed report issued last summer, have now taken aim at the heart of the Too-Big-To-Fail issue through its examination of the much-publicized catastrophic derivative trades made by its amusingly-nicknamed "London Whale" trader, Bruno Iksil, last year.

Most ordinary people dimly remember the London Whale episode now, and even at the time struggled to understand even the vaguest contours of the story while mainstream reporters (including people like myself) were trying with all their might to make sense of it from afar. What most people got out of that story was that J.P. Morgan Chase somehow lost buttloads of money through some sort of impossibly complex derivative trade – billions, though nobody could ever settle on an exact number – and that this was somehow a very bad thing that required the attention of the federal government, although even that part of it was a bit of a mystery to most ordinary people.

Gangster Bankers: Too Big to Jail

Why should we care if a private bank, or more to the point a private banker like Chase CEO Jamie Dimon, loses a few billion here and there? What business is it of ours? And why did we have to have congressional hearings about it last year? The whole thing certainly seemed a big mystery to Dimon himself, who dragged himself to Washington and spent the entire time rolling his eyes and snorting at Senators' questions, clearly put out that he even had to be there.

This new report by the Permanent Subcommittee answers the question of why the public needed to be involved in that episode. What the report describes is an epic breakdown in the supervision of so-called "Too Big to Fail" banks. The report confirms everyone's worst fears about what goes on behind closed doors at such companies, in the various financial sausage-factories that comprise their profit-making operations.

If the information in the report is correct, Chase followed the behavioral model of every corrupt/failing hedge fund this side of Bernie Madoff and Sam Israel, only it did it on a much more enormous scale and did it with federally-insured deposits. The fund used (in part) federally-insured money to create, in essence, a kind of super high-risk hedge fund that gambled on credit derivatives, and just like Sam Israel did with his Bayou fund, when it got in trouble, it resorted to fudging its numbers in order to disguise the fact that it was losing money hand over fist.
Chase for years hid the very existence of this operation from banking regulators and lied about the purpose of the fund (saying it was purely a hedging operation when it stopped being a hedge and instead became a wild directional gamble), and it also changed the way it calculated the fund's value once it started to lose hundreds of millions of dollars. Even worse, the bank's own internal auditors signed off on the phoney-baloney accounting of this Synthetic Credit Portfolio (SCP), at one point allowing it to claim $719 million in losses when the real number was closer to $1.2 billion.

How did they do this? In the years leading up to January of 2012, Chase used a standard, plain-vanilla method to price the derivative instruments in its portfolio. The method was known as "mid-market pricing": if on any given day you had a range of offers for a certain instrument – the "bid-ask" range – "mid-market pricing" just meant splitting the difference and calling the value the numerical middle in that range.

But in the beginning of 2012, Chase started to lose lots of money on the derivatives in its SCP, and just decided to change its valuations, that they weren't in the business of doing "mids" anymore. One executive thought the "market was irrational." As the Subcommittee concluded:

By the end of January, the CIO had stopped valuing two sets of credit index instruments on the SCP's books, the CDX IG9 7-year and the CDX IG9 10-year, near the midpoint price and had substituted instead noticeably more favorable prices.

If you can fight through the jargon, what this basically means is that Chase decided to go into the fiction business and invent a new way to value its crazy-ass derivative bets, using, among other things, a computerized model the company designed itself called "P&L predict" which subjectively calculated the value of the entire fund toward the end of every business day.

If this all sounds familiar, it's because it's the same story we've heard over and over again in the financial-scandal era, from Enron to WorldCom to Lehman Brothers – when the going gets tough, and huge companies start to lose money, they change their own accounting methodologies to hide their screw-ups, passing the buck over and over again until the mess explodes into the public's lap. The difference is that Chase is a much bigger and more dangerous company to be engaging in this kind of behavior.

An even scarier section of the report regards the reaction of the Office of the Comptroller of the Currency, or OCC, the primary government regulator of Chase. The report exposes two huge problems here. One, Chase consistently hid crucial information from the OCC, including the sort of massive increases in risk the OCC was created precisely to monitor. Two, even when the bank didn't hide stuff, the OCC was either too slow or too disinterested to take notice of potential problems. From the report:
During 2011, for example, the notional size of the SCP grew tenfold from about $4 billion to $51 billion, but the bank never informed the OCC of the increase. At the same time, the bank did file risk reports

with the OCC disclosing that the CIO repeatedly breached the its stress limits in the first half of 2011, triggering them eight times, on occasion for weeks at a stretch, but the OCC failed to follow up with the bank.

In other words, Chase added nearly $50 billion in risk and failed to mention the fact to the OCC – but the OCC also failed to bat an eyelid when Chase breached its stress limits eight times in a space of six months, often for weeks at a time. Do you feel safer now?

This episode proves what everyone already implicitly understands about these gigantic banking institutions: that their accounting is often little more than a monstrous black box within which any sort of mischief can and probably is being hidden from shareholders, counterparties, and the public, which has a direct interest in the health of these banks because (a) their enormous size makes them systemically important, i.e. we'd all be screwed if any of them collapsed, and (b) they are the supposedly cautious and conservative guardians of billions in federally-insured deposits.

The Senate investigators highlighted a frightening metaphor to explain what they found out about Chase's response to its burgeoning accounting disaster last winter and spring:
The head of the CIO's London office, Achilles Macris, once compared managing the Synthetic Credit Portfolio, with its massive, complex, moving parts, to flying an airplane. The OCC Examiner-in-Charge at JPMorgan Chase told the Subcommittee that if the Synthetic Credit Portfolio were an airplane, then the risk metrics were the flight instruments. In the first quarter of 2012, those flight instruments began flashing red and sounding alarms, but rather than change course, JPMorgan Chase personnel disregarded, discounted, or questioned the accuracy of the instruments instead.

Investigators took note of this and then, sensibly, wondered if Chase was the only bank ignoring all those flashy lights:
The bank's actions not only exposed the many risk management deficiencies at JPMorgan Chase, but also raise systemic concerns about how many other financial institutions may be disregarding risk indicators and manipulating models to artificially lower risk results and capital requirements.

Anyway, officials from Chase and the OCC are being dragged in tomorrow to answer some heavy questions about all of this. Expect a lot of double-talk, sweaty foreheads, pompous "You just don't understand because you don't make enough money" excuses, and other sordid behaviors. Tune in here for updates.

In the meantime, kudos to Senator Levin and to his Republican partner in this investigation, John McCain, for taking on this topic. Increasingly, key voices in the upper chamber like these two, plus Ohio's Sherrod Brown, Iowa's Chuck Grassley, Oregon's Jeff Merkley, Vermont's Bernie Sanders and others are starting to act genuinely worried about the Too Big to Fail issue. Their determination to keep it in the public eye is, to me, a signal that a consensus is forming behind the scenes on the Hill.

Florida Legislature Pushing Fracking Disclosure Bill

Nothing to Sneeze At
by STEVE HORN


Florida may soon become the fourth state with a law on the books enforcing hydraulic fracturing (“fracking”) chemical disclosure. The Florida House of Representatives’ Agriculture and Natural Resources Subcommittee voted unanimously (11-0) on March 7 to require chemical disclosure from the fracking industry. For many, that is cause for celebration and applause.

Fracking for oil and gas embedded in shale rock basins across the country and world involves the injection of a 99.5-percent cocktail of water and fine-grained sillica sand into a well that drops under the groundwater table 6,000-10,000 feet and then another 6,000-10,000 feet horizontally. The other .5 percent consists of a mixture of chemicals injected into the well, proprietary information and a “trade secret” under the Energy Policy Act of 2005, which current President Barack Obama voted “yes” on as a Senator.

That loophole is referred to by many as the Halliburton Loophole because Dick Cheney had left his position as CEO of Halliburton – one of the largest oil and gas services corporations in the world – to become Vice President and convene the Energy Task Force. That Task Force consisted of the Secretaries of State, Treasury, Interior, Agriculture, Commerce, Transportation and Energy. One of its key actions was opening the floodgates for unfettered fracking nationwide.
Between 2001 and the bill’s passage in 2005, the Task Force held over 300 meetings with oil and gas industry lobbyists and upper-level executives. The result was a slew of give-aways to the industry in this omnibus piece of legislation. On top of the “Halliburton Loophole,” the bill also contains an exemption for fracking from Environmental Protection Agency (EPA) enforcement of the Clean Water Act and the Safe Drinking Water Act.
The federal-level response to closing the ”Halliburton Loophole” is the Fracturing Responsibility and Awareness of Chemicals (FRAC) Act, a bill that never garnered more than a handful of co-sponsors.

The state-level response, the story goes, is versions of the bill that recently passed onan 11-0 bipartisan basis in a Florida state house subcommittee.

Introduced as the “Fracturing Chemical Usage Disclosure Act” on Feb. 13, bill sponsor Rep. Ray Rodrigues (R-76) told The Palm Beach Post the day the bill passed in Subcommittee that there is ”every indication…at some point in the future” that fracking will proceed in the Sunniland Shale basin and that being “proactive” is the way to go. A senate companion bill was also introduced as SB 1028 by Sen. Jeff Clemons (D-27) and if the bill passes in both chambers, it will be labeled SB 1776.

What Rodrigues didn’t mention: the law was written by what investigative journalist Steve Coll referred to as a “private empire,” ExxonMobil.

Like its federal-level predecessor, it still contains the “trade secrets” loophole. It’s also a model bill distributed both by the American Legislative Exchange Council (ALEC), as first revealed by The New York Times in April 2012, and the Council of State Governments (CSG), as first revealed here on DeSmogBlog.
FracFocus Façade: Sunshine State’s Copy-Paste and Disaster-in-the-Make

It’s “Sunshine Week” for open government groups and in the Sunshine State we’ve just witnessed a “copy-paste” job that happened out in broad daylight with no one noticing – until now.

A review of the bill’s verbiage reveals it is essentially a mirror image of ALEC’s Disclosure of Hydraulic Fracturing Fluid Composition Act and CSG’s “Act relating to the disclosure of the composition of hydraulic fracturing fluids.”

Most telling is the section of Florida’s bill calling for an “online hydraulic fracturing chemical registry.” That registry, like the Texas model the bill is based off of, would be run by FracFocus. An August investigation by Bloomberg News revealed that FracFocus merely offers the façade of disclosure, or a “fig leaf” of it, as U.S. Rep. Diane DiGette (D-CO), co-sponsor of the FRAC Act put it.

“Energy companies failed to list more than two out of every five fracked wells in eight U.S. states from April 11, 2011, when FracFocus began operating, through the end of last year,” wrote Bloomberg. “The gaps reveal shortcomings in the voluntary approach to transparency on the site, which has received funding from oil and gas trade groups and $1.5 million from the U.S. Department of Energy.

In reality, FracFocus is a public relations front for the oil and gas industry, as we reported here in Dec. 2012, explaining,
FracFocus’ domain is registered by Brothers & Company, a public relations firm whose clients include America’s Natural Gas Alliance, Chesapeake Energy, and American Clean Skies Foundation – a front group for Chesapeake Energy.

In short, the bill offers “sunshine” to the public in name only.

“This disclosure bill has a hole big enough to drive a Mack truck through,” Texas Rep. Lon Burnam (D-90) told Bloomberg.

How the Bill Became a “Model”

In May 2011, the Obama Administration Department of Energy (DOE) fracking subcommittee - consisting almost entirely of officials with ties to the oil and gas industry - convened to produce “best practices” for state-level regulations and disclosure standards for fracking.

Out of the subcommittee came the standards written into a Texas bill, HB 3328, passed one month later in June 2011 in a 137-8 roll call vote, while its Senate companion bill passed on a 31-0 unanimous roll call vote. $1.5 million in FracFocus funding stems from the DOE fracking subcommittee.

A Dec. 2012 Bloomberg probe revealed that the industry utilized the “trade secrets” exemption 19,000 times its first year as law of the land in Texas. For perspective, there are only 6,000 fracking wells in the state at-large.

In Oct. 2011 and Dec. 2011, the Texas bill became a “model bill” both at the CSG and ALEC annual meetings, respectively. ExxonMobil was one of the biggest corporate patrons for CSG’s annual meeting that year, serving as a Gold Level Sponsor.

CSG is a partially corporate-funded and taxpayer-subsidized (via portions of state-level budgets) “trade association” which, like ALEC, passes model legislation often written by and voted upon by corporate lobbyists sitting alongside state-level legislators at its annual meetings. It refers to these bills as “Suggested State Legislation” (SSL). Unlike ALEC, its maintains bipartisan membership.

ALEC is 98 percent funded by corporations, corporate-funded foundations and trade associations. Like CSG, ALEC also passes “model bills” at its annual meetings in similar fashion: behind closed doors, with corporate lobbyists sitting alongside state-level legislators voting “up-down” on proposals. Unlike CSG, it’s predominantly a Republican-centric operation.
The New York Times revealed in an April 2012 investigation that ExxonMobil authored the disclosure standards in the Texas bill that came from the DOE fracking subcommittee. ExxonMobil is the number one producer of shale oil and gas in the United States and a corporation which scored $44.9 billion in profits in 2012, $300 million dollars short of the world record for highest ever annual profit (which Exxon set in 2008).

The model bill has passed in Colorado and Pennsylvania and was proposed but failed in Massachusetts, Maryland, New York, Indiana, California, and Arkansas. Section 77 of Illinois’ proposed Hydraulic Fracturing Regulation Act - as revealed here on DeSmogBlog - also contains the “trade secret” exemption.

Seven of the 15 members of the Florida Agriculture and Natural Resources Subcommittee are ALEC members.

Industry’s Florida Plans Include Fracking the Everglades

A portion of the Sunniland Trend Shale, based in southwestern and southern Florida, overlaps the Everglades National Park. Florida’s Republican Gov. Rick Scott, a climate change denier, has gone on the record stating fracking in the pristine park is fair game.

Department of Environmental Protection enforcement fell to record-low levels in 2011 in Florida, Scott’s first year in office.

“The total number of enforcement cases fell by more than a fourth (28%) and the DEP Office of General Counsel received the third lowest number of case reports in agency history,” wrote The Bradenton Times. “Pollution penalty assessments dipped by a similar proportion (29%) while penalties actually collected dropped by more than half (57%). The number of big fine cases (more than $100,000) also was cut by half.”

While some speculate as to whether fracking will ever actually happen in Florida, the oil and gas industry has shown it’s serious about developing this shale basin and will host the “Emerging Shale Plays USA” conference in Houston, TX from April 24-25. One of the sessions being led by Brandt Temple, the CEO of Sunrise Exploration & Production is titled, “Mapping The Geological Variance Of The Lower Sunniland To Pinpoint Sweet Spots And Identify Where To Place Wells.”

ALEC’s track-record in the “United States of ALEC” is nothing to sneeze at.

“Each year, close to 1,000 bills, based at least in part on ALEC Model Legislation, are introduced in the states. Of these, an average of 20 percent become law,” ALEC boasts on its website.

One would be remiss given this track record, then, to write off the threat of fracking in the Florida swamplands.

Monsanto the devil’s Death Patents

A Death Grip on Our Food Supply
by RANDALL AMSTER


Monsanto the devil has yet another case pending in the court system, this time before the U.S. Supreme Court on the exclusivity of its genetically modified seed patents. Narrowly at issue is whether Monsanto the devil retains patent rights on soybeans that have been replanted after showing up in generic stocks rather than being sold specifically as seeds, or whether those patent rights are “exhausted” after the initial planting. But more broadly the case also raises implications regarding control of the food supply and the patenting of life – questions that current patent laws are ill-equipped to meaningfully address.

On the specific legal issues, Monsanto the devil is likely to win the case (they almost always do). The extant facts make this a relatively poor platform to serve as a test case of Monsanto the devil’s right to exert such expansive powers. The farmer in this situation had previously purchased Monsanto the devil soybeans for planting (back in 1999), and in this instance bought previously harvested soybeans with the intention of planting them – even spraying Monsanto the devil’s Roundup herbicide on them in the hopes that at least some of the generic stock would be of the so-called “Roundup Ready” variety.

Despite this unfortunate posture, the case does provide another opportunity for critical inquiry regarding the unprecedented and perverse level of control Monsanto the devil is asserting over the food supply. It is estimated that 90 percent of the soybeans in the U.S. are genetically modified and thus subject to potential patents. A random handful of soybeans procured anywhere is likely to contain at least some Monsanto the devil-altered beans. Such a near-monopoly effectively gives Monsanto the devil the right to control access to a staple food item that is found in a wide range of consumer products.

Other variations on this theme include pollen from Monsanto the devil corn (similarly dominant in the U.S. market) pollinating a farmer’s crop, or seeds from Monsanto the devil-engineered grains being distributed by animals, winds, or waterways and commingling with non-GMO plantings. In each case, Monsanto the devil could have a cause of action against an unwitting farmer by claiming patent infringement.

More broadly, and unlikely to be addressed in the instant case, is whether Monsanto the devil (or any other company) should be able to patent seeds – the core of global food supplies, and thus of sustenance for billions of people – in the first place. Activists will decry the fact that Monsanto the devil is patenting life, and this is indeed an Orwellian (or perhaps a Huxleyan) prospect, to be sure. Yet I would submit that Monsanto the devil is actually patenting death, which is potentially even more disconcerting.

Consider that by exerting this level of control over the food supply, Monsanto the devil is rapidly creating a world in which people have to pay fealty to the corporation in order to grow food and/or consume it. In this sense, Monsanto the devil gains enormous power to determine who is allowed to eat – and thus who lives or dies. Consider further that Monsanto the devil’s patents also include technologies in which seeds are sold that cannot propagate themselves, resulting in plants terminating rather than perpetuating, requiring farmers to have to go back to the “company store” every season in order to replant their fields.

In the case currently before the Court, shades of the latter issue are present, with the question being whether the seeds of the seeds of Monsanto the devil creations retain their exclusive patent rights – possibly in perpetuity. This sort of argument might give us cause to wonder whether an animal (or even a human being, someday?) who consumes these proprietary foods could be implicated in such assertions if they are somehow genetically altered in the process. Perverse slippery slopes aside, the permeation of patentable materials throughout the food chain is by now a clear and present danger.

These are troubling trends indeed. Monsanto the devil wants the right to exert perpetual control, and with it the power to make decisions about who/what lives or dies. In addition to seed patents, their corporate creations include herbicides, pesticides, and biocides that toxify soils and poison waters. Genetically modified foods increasingly dominate the U.S. food supply (and supplies elsewhere, at least where they haven’t been explicitly banned) despite insufficient testing and concerns about their health impacts. The ability of corporations like Monsanto the devil to continue plying such products with little oversight constitutes a de facto consumer beta test on a mass level, the full effects of which may not be known for decades, if ever.

Taking all of this together, it increasingly appears that Monsanto the devil is patenting death, perhaps even more so than life. Their patent rights should not trump the rights of people to procure safe, healthy, living foods. Whatever the result in the Supreme Court case, we should roundly deem Monsanto the devil a loser in the court of public opinion, and strive to loosen their death grip on our food supply.

Let's also not forget that Justice Clarence Thomas was once upon a time legal counsel to Monsanto the devil for quite a few years and refuses to recuse himself,  even though his ruling on the case is a clear conflict of interest. --jef

Thursday, March 14, 2013

The Bad News About Jobs

The Coming Contraction
by DEAN BAKER


More than five years into the downturn it doesn’t take much to get people excited about the state of the economy. The Labor Department’s February employment report showing the economy generated a better-than-expected 236,000 jobs and the unemployment rate had fallen 0.2 percentage points to 7.7 percent was sufficient to get the optimists’ blood flowing. Unfortunately, they are likely to be disappointed.

First off, if the 236,000 jobs number sounds good to you than you probably are not old enough to remember 271,000 number reported last February or the 311,000 number reported in January of 2012. The strong winter job growth was followed by a dismal spring in which job growth slowed to a trickle.

While most economic measures implied that the economy suddenly shifted from hot to cold, the more obvious explanation was that unusually good winter weather in the Northeast and the Midwest pulled hiring forward, as some of us warned at the time. This is likely part of the story this year as well.

While few people in the northern part of the country have been sunbathing in January and February, we did not see the sort of severe snowstorms or sub-zero weather that typically leads to a few days without work in at least part of the region. This likely explains the 48,000 job growth reported for construction in February, as well as higher-than-expected growth in retail and temporary employment.

The drop in the unemployment rate is also not as good news as it may initially seem. The Labor Department reported that 130,000 people left the labor force in the month so they are no longer counted as unemployed. The percentage of the adult population that is employed—the employment-to-population ratio (EPOP) – was unchanged at 58.6 percent. This is just 0.4 percentage points above the low hit in the summer of 2011 and is unchanged over the last year.

While the unemployment rate has fallen back by 2.3 percentage points from its peak, reversing more than 40 percent of its increase, the EPOP is still down by 4.5 percentage points from its pre-recession level. The drop in unemployment is much more the result of people giving up the search for employment and leaving the labor force than workers finding new jobs.

The one genuinely encouraging piece of news in the February employment data is an uptick in wage growth. Over the last three months, average hourly earnings rose at a 2.85 percent annual rate compared with the prior three months. If this continues it would imply that workers are actually seeing real wage gains. Unfortunately, this increase was likely driven by some state minimum wage increases and the sort of random movements that causes these data to fluctuate erratically, but this is an item that the optimists can look to for hope.

Looking beyond this report, there is not much reason for optimism. Housing construction is rising but from a very low base. It had fallen back to just 2.0 percent of GDP, so even a 20 percent growth rate would add just 0.4 percentage points to GDP growth. The most recent data on investment shows a sharp drop, albeit after 3 months of good growth. We will be fortunate if this category grows at more than a 10 percent annual rate in 2013.

While an upward revision to the 4th quarter GDP data turned a negative 0.1 percent into a positive 0.1 percent, the economy still only grew at a 1.6 percent annual rate in the second half of 2012. Apart from the uptick in construction, there are few good reasons to expect much of an acceleration from this growth rate. On the other hand, the ending of the payroll tax cut will pull more than $100 billion a year out of the economy. The impact of this tax increase was just being felt when the February jobs survey was taken in the middle of the month.

The other big hit to the economy will be from the sequester, which will pull roughly $80 billion in federal spending out of the economy. The forecasts from the Congressional Budget Office and others show the sequester slowing growth by 0.5-0.6 percentage points. The economy has not even begun to feel the impact of these cuts, most of which will not start to effect until April.

In short, we have an economy that had been growing at a not very healthy pace through the second half of 2012 that is virtually certain to be slowed by contractionary fiscal policy through the rest of 2013. Unless there is a rapid reversal of policy, the 7.7 percent unemployment rate is likely to represent a low that we may not see again for some time. While the economy is not likely to fall into a recession and send the unemployment rate soaring, the economy is not growing fast enough to meet the need for jobs from a growing labor force. As a result unemployment will be going in the wrong direction for the rest of the year.

Wednesday, March 13, 2013

This Modern Sequestration




The Ryan Budget vs Women and Children - GOP Misogeny

Paul Ryan is a dick? Say it ain't so...



The Ryan budget won't ever pass the senate. It has to pass both houses to be put in place. Unless Obama sells out to the Republicans again.

Artists Against Fracking Present: "Don't Frack My Mother"

Tuesday, March 12, 2013 by Artists Against Fracking



The artists of Artists Against Fracking worked together to create this music video for “Don’t Frack My Mother,” Sean Lennon’s very own anti-fracking anthem. This is the perfect time to celebrate our progress. In case you missed it, the New York State Assembly passed a two-year moratorium on fracking in New York. But this is also the perfect time to keep the pressure up! The bill’s not a done deal. It still has to pass the State Senate and then get signed into law by Governor Cuomo.

Directors: Sarah Sophie Flicker, Maximilla Lukacs and Tennessee Thomas
Producer: Rebecca Fernandez
Editor: Maximilla Lukacs

Adrian Grenier
Alexa Chung
Ben Lee
Carrie Fisher
Daniel Pinchbeck
Devendra Banhart
Fred Armisen
Ione Skye
Joseph Gordon-Levitt
Josh Fox
Liv Tyler
Lindsey Wixson
Maggie Gyllenhaal
Mark Ronson
Melissa Auf Der Maur
Michael Skolnik
Natasha Lyonne
Penn Badgley
Reggie Watts
Sean Lennon
Susan Sarandon
Yoko Ono
Zoë Kravitz


Also featuring band members from:

Au Revoir Simone
Black Lips
Cibo Matto
The Citizens Band
The Like
The Strokes
Wilco
Wild Belle



Sen. Elizabeth Warren slams Republicans: Worry less about helping big banks

By Eric W. Dolan | RAW Story
Tuesday, March 12, 2013


Democratic Sen. Elizabeth Warren of Massachusetts slammed Republicans on Tuesday for holding up the confirmation of Richard Cordray to be director of the Consumer Financial Protection Bureau.

At a Senate Banking Committee hearing, the progressive senator suggested Republicans were using false arguments to fight the nomination of Cordray. Warren, who was a key figure in setting up the relatively new agency, questioned why Republicans believed it was wrong for the CFPB to have a single director, but was acceptable in the case of numerous other agencies like the Office of the Comptroller of the Currency.

“I see nothing here but a filibuster threat against Director Cordray as an attempt to weaken the consumer agency,” Warren said. “I think the delay in getting him confirmed is bad for consumers, it’s bad for small banks, bad for credit unions, for anyone trying to offer an honest product in an honest market.”

“The American people deserve a Congress that worries less about helping big banks, and more about helping regular people who have been cheated on mortgages, on credit cards, on student loans and on credit reports,” she added.

The Consumer Bureau was created by the Dodd–Frank Wall Street Reform and Consumer Protection Act to regulate financial services such as mortgages and credit cards. The agency issued new rules to restrict high-risk home loans in January and began looking into predatory private student lenders in February.

Senate Republicans previously blocked Cordray’s confirmation to the CFPB in 2011, but Cordray later became the director of the agency through a recess appointment. Republicans have called for the agency to have significantly reduced powers, claiming it currently lacks proper oversight.

Watch video, uploaded to YouTube by Sen. Warren, below:


The Sequester, Explained



Where did the whole idea of sequestration originate? 

It goes back to 1985. The tax cuts of Ronald's Reagan early years, combined with his aggressive defense buildup, produced a growing budget deficit that eventually prompted passage of the Gramm-Rudman-Hollings Act. GRH set out a series of ambitious deficit reduction targets, and to put teeth into them it specified that if the targets weren't met, money would automatically be "sequestered," or held back, by the Treasury Department from the agencies to which it was originally appropriated. The act was declared unconstitutional in 1986, and a new version was passed in 1987.

Sequestration never really worked, though, and it was repealed in 1990 and replaced by a new budget deal. After that, it disappeared down the Washington, DC, memory hole for the next 20 years.

What about the 2013 version? Where did that come from? 

 In the summer of 2011, Republicans decided to hold the country hostage, insisting that they'd refuse to raise the debt ceiling unless President Obama agreed to substantial deficit reduction.

After months of negotiations over a "grand bargain" finally broke down in July, Republicans proposed a plan that would (a) make some cuts immediately and (b) create a bipartisan committee to propose further cuts down the road. But they wanted some kind of automatic trigger in case the committee couldn't agree on those further cuts, so the White House hauled out sequestration from the dustbin of history as an enforcement mechanism. It would go into effect automatically if no deal was reached.

In the end, no immediate cuts were made, but a "supercommittee" was set up to propose $1.5 trillion in deficit reduction later in the year. To make sure everyone was motivated to make a deal, the sequester was designed to be brutal: a set of immediate, across-the-board cuts to both defense spending and domestic spending, starting on January 1, 2013. The idea was that everyone would hate this so much they'd be sure to agree on a substitute.

Needless to say, no such agreement was reached. So now we're stuck with the automatic sequestration cuts.

How big is the sequester?  

You'd think this would be an easy question to answer. In fact, it's surprisingly complicated! Are you ready?

The basic amount of the sequester is $1.2 trillion in deficit reduction over 10 years. But when you reduce spending, you also reduce interest on the national debt. This means that we only need $984 billion in actual program cuts. And since it's for 10 years, naturally that means we divide by nine to get annual spending cuts of $109 billion. For FY2013, this comes to $12 billion per month, because there are only nine months from January (when the sequester begins) through the end of the fiscal year in September.

But wait! The fiscal cliff deal in January delayed the sequester until March 1, so it also lopped off two months of cuts. This means that the total amount of spending cuts for this year clocks in at $85 billion.

So what gets cut? 

The sequester is split evenly between defense spending and domestic spending. The domestic half has two parts: Medicare and everything else. For Medicare, the sequester specifies a flat 2 percent cut in reimbursements. Doctors will continue to bill at their usual rate, but they'll only receive 98 cents on the dollar. According to the Congressional Budget Office, here's how the whole thing nets out (see Table 1-2):
  • Defense: $42.7 billion
  • Medicare: $9.9 billion
  • Other domestic: $32.7 billion
Aside from Medicare, how are the other cuts divvied up?  

The sequester legislation requires the cuts to come evenly from every budget account. This means everything (with a few exceptions) gets cut the same amount. This is an especially stupid way to cut spending, since everyone agrees that some programs are more important than others, but that's the way it is. If you really want to torture yourself, you can read this Office of Management and Budget report, which contains 224 pages listing the sequester amounts from every single agency in the United States government. It's followed by another 158 mind-numbing pages of agency accounts that are exempt from the sequester.

But as stupid as this is, don't get too excited about it. It's only for FY2013, which lasts seven more months. After that, although the total amount stays in place ($109 billion, split evenly between defense and domestic spending), congressional appropriations committees have much more flexibility about how to juggle the cuts.

Aren't we still in a recession? What are these cuts going to do to the economy?  

Technically, we're no longer in a recession, but there's no question the economy remains weak. A big bunch of dumb spending cuts is about the last thing we need.

That said, the actual impact of the cuts is hazy. Among private forecasting firms, Macroeconomic Advisers figures the sequester will cut GDP by 0.7 percentage points, while IHS Global Insight puts it at 0.3 percent. Back before the sequester was delayed, CBO estimated 0.8 percentage points. Given a consensus growth forecast of about 2 percent for this year, this is a fairly substantial headwind. In terms of jobs, it will probably increase the unemployment rate by about half a percentage point. This is why Fed chairman Ben Bernanke basically told Congress on Tuesday that they were nuts to let the sequester proceed.

That's all sort of bloodless. How about some horror stories? You know, three-hour waits at airports because of TSA cutbacks, food poisoning epidemics thanks to USDA cutbacks, that sort of thing?  

The White House has been making a lot of hay over its 50-state breakdown of cutbacks. California, for example, will lose 1,200 teachers, 8,200 Head Start slots, 49,000 HIV tests, $5 million in meals for seniors, etc. You can see the forecasts for your state here. Aside from that, Wonkblog seems to be the go-to site for alarmist coverage of the sequester. Brad Plumer has the impact on R&D spending here. In an interview with Ezra Klein, former NIH director Elias Zerhouni says it will be a "disaster for research." Suzy Khimm interviews a former Homeland Security official here who says smuggling will increase. And MoJo's own Zaineb Mohammed lists six ways the sequester will hurt the environment here, including higher risk of damage from wildfires.

That's terrible! Does anyone have a plan to avoid the sequester? 

 Sure. Sort of. President Obama has proposed a substitute that includes about $1.1 trillion in spending cuts and $700 billion in new revenue. It was dead on arrival because Republicans are flatly unwilling to consider any plan that includes higher taxes. Back in December, Republicans in the House passed a bill that would have kept all the domestic cuts and replaced the defense cuts with yet more domestic cuts, mostly to anti-poverty programs. It was DOA too, for obvious reasons. House and Senate Democrats have plans as well.

But the truth is that there's probably no deal to be made. Republicans won't accept tax hikes, Democrats won't accept any bill that's exclusively spending cuts, and neither party is willing to just kill the sequester outright, which is the most sensible option. For now, all that's really happening is that both sides are barnstorming the country blaming the other guys. Obama seems to be winning that battle at the moment.

The White House Is for Sale Under Barack Obama, Too

Obama joins a long line of presidents to offer exclusive access for big bucks.
—By Andy Kroll | Tue Mar. 12, 2013 | Mother Jones

On Wednesday night, at the swanky St. Regis Hotel three blocks north of the White House, President Barack Obama will schmooze with his biggest donors and most avid grassroots supporters at a "founder's summit" for Organizing for Action, the controversial pro-Obama nonprofit group. OFA will use the email lists, social networks, and cutting-edge technologies honed during Obama's reelection campaign to try to galvanize Americans in support of the president's second-term agenda.

But watchdogs and reformers are up in arms after the New York Times revealed that supporters who raise or donate $500,000 or more will score invites to quarterly meetings with Obama and other exclusive perks unavailable to run-of-the-mill Obama supporters. "Access to the president should never be for sale," said Common Cause president Bob Edgar.

White House Press Secretary Jay Carney denied there was a price tag to meet Obama, but he didn't dispute the story detailing OFA's $500,000 pitch. OFA had originally considered accepting corporate money as it tries to raise $50 million, but last week OFA director Jim Messina backtracked on that plan.

Obama is not the first president who will trade face time for big bucks. Buying and selling access is a long bipartisan tradition in American politics. Here are eight more of its most famous practitioners:

WHO: Andrew Jackson
WHEN: 1829
HOW MUCH: As much as you could afford.
WHAT YOU GET: A job in the Jackson administration under the president's spoils system.
MONEY QUOTE: "To the victor belong the spoils of the enemy"— Sen. William Marcy


WHO: Warren G. Harding
WHEN: 1920
HOW MUCH: $1 million
WHAT YOU GET: A seat at Harding's poker parties and an invitation to overnight at the White House.
MONEY QUOTE: "It's not my enemies…it's my damn friends who keep me walking the floor nights!"— Harding, in the wake of the Teapot Dome scandal embroiling several of his biggest donors.


WHO: Lyndon Johnson
WHEN: 1966
HOW MUCH: $1,000 minimum per year
WHAT YOU GET: Membership in the "President's Club," Johnson's exclusive club of donors who get a "direct relationship" with the White House.
MONEY QUOTE: "Bearing the imprimatur of Lyndon Johnson, [the President's Club] has no rules, keeps no minutes…and transacts no business that anyone talks about"—The New Republic, October 1966


WHO: Richard Nixon
WHEN: 1971
HOW MUCH: $250,000 or more
WHAT YOU GET: An ambassadorship
MONEY QUOTE: "From now on, the contributors have got to be, I mean, a big thing and I'm not gonna do it for political friends and all that crap"—Nixon to his chief of staff H.R. Haldeman, during a discussion on the price of an ambassadorship.


WHO: Jimmy Carter
WHEN: 1979
HOW MUCH: $1,000 per corporation
WHAT YOU GET: A seat at a glitzy White House state dinner celebrating the 1979 Egypt-Israel peace treaty
MONEY QUOTE: "It is hardly a proud Uncle Sam who takes off his tall hat in order to pass it"—a March 27, 1979, editorial in the New York Times.


WHO: George H.W. Bush
WHEN: 1987-88
HOW MUCH: $100,000 or more as part of Bush's Team 100 program
WHAT YOU GET: An invite to a black-tie dinner at the White House, an ambassadorship, or a job in the Bush administration.
MONEY QUOTE: "Quite a high percentage of [Bush fundraisers] who have been helpful haven't gotten anything—at least 50 percent"—Bush's chief fundraiser Robert Mosbacher


WHO: Bill Clinton
WHEN: 1994-95
HOW MUCH: $50,000-$100,000
WHAT YOU GET: An overnight stay in the Lincoln Bedroom or dinner with Clinton at the White House
MONEY QUOTE: "The White House is like a subway: You have to put in coins to open the gates"—Johnny Chung, a Taiwanese-born businessman and major Democratic donor in the 1990s.


WHO: George W. Bush
WHEN: 2002-03
HOW MUCH: $100,000 or more in funds raised for Bush's 2004 campaign
WHAT YOU GET: An overnight stay at the White House or Camp David—or both
MONEY QUOTE: "It is so unbelievably exciting and unbelievable that you are staying in the White House. One hesitates to put a coffee cup down on the coffee table because there's an original copy of the Emancipation Proclamation under glass"—Donald Etra, a Bush donor who overnighted at the White House.

Monday, March 11, 2013

The Chart That Proves The Flaw in How the BLS Figures the Unemployment Rate

March 10th, 2013
InvestmentWatch


The mainstream media is absolutely giddy that the U.S. unemployment rate (U3) has hit a “four-year low” of 7.7 percent. But is unemployment in the United States actually going down? After all, you would think that it should be. The Obama administration has “borrowed” more than 6 trillion dollars from future generations of Americans, interest rates have been pushed to all-time lows, and the Federal Reserve has been wildly printing more money in a desperate attempt to “stimulate” the economy. So have those efforts been successful? Well, according to the mainstream media, the U.S. unemployment rate is falling steadily. Headlines all over the nation boldly declared that “236,000 jobs” were added to the economy in February, but what they didn’t tell you was that the number of Americans “not in the labor force” rose by 296,000.

That is how they are getting the unemployment rate to go down – by pretending that huge numbers of unemployed Americans don’t want jobs. Sadly, as you will see below, the truth is that the percentage of working age Americans that have a job is just 0.1% higher than it was exactly three years ago. And we have not even come close to getting back to where we were before the last economic crisis.

At this point, the “unemployment rate” has become so meaningless that it really isn’t even worth paying much attention to. If you really want to know what the employment picture looks like in the United States, you need to look at the employment-population ratio.

As Wikipedia tells us, many economists consider the employment-population ratio to be far superior to other measurements of employment…
The Organization for Economic Co-operation and Development defines the employment rate as the employment-to-population ratio. The employment-population ratio is many American economist’s favorite gauge of the American jobs picture. According to Paul Ashworth, chief North American economist for Capital Economics, “The employment population ratio is the best measure of labor market conditions.” This is a statistical ratio that measures the proportion of the country’s working-age population (ages 15 to 64 in most OECD countries) that is employed. This includes people that have stopped looking for work.
A chart of the employment-population ratio in the United States over the past several years is posted below…
Employment-Population Ratio 2013


As you can see, the percentage of Americans with a job fell from about 63 percent to below 59 percent during the last economic crisis.  Since that time, it has not risen back above 59 percent.  This is the first time in the post-World War II era that we have not seen the employment rate bounce back following a recession.  At this point, the employment-population ratio has been below 59 percent for 42 months in a row.

Yes, we should be thankful that things have stabilized, but as you can see there has been no recovery.  The percentage of Americans with a job is essentially exactly where it was three years ago.  Despite the trillions of dollars that the U.S. government has borrowed, and despite the reckless money printing that the Federal Reserve has been doing, the employment situation in the U.S. has not turned around.

Data for the employment-population ratio from the beginning of 2008 is posted below…


2008-01-01 62.9
2008-02-01 62.8
2008-03-01 62.7
2008-04-01 62.7
2008-05-01 62.5
2008-06-01 62.4
2008-07-01 62.2
2008-08-01 62.0
2008-09-01 61.9
2008-10-01 61.7
2008-11-01 61.4
2008-12-01 61.0
2009-01-01 60.6
2009-02-01 60.3
2009-03-01 59.9
2009-04-01 59.8
2009-05-01 59.6
2009-06-01 59.4
2009-07-01 59.3
2009-08-01 59.1
2009-09-01 58.7
2009-10-01 58.5
2009-11-01 58.6
2009-12-01 58.3
2010-01-01 58.5
2010-02-01 58.5
2010-03-01 58.5
2010-04-01 58.7
2010-05-01 58.6
2010-06-01 58.5
2010-07-01 58.5
2010-08-01 58.5
2010-09-01 58.5
2010-10-01 58.3
2010-11-01 58.2
2010-12-01 58.3
2011-01-01 58.3
2011-02-01 58.4
2011-03-01 58.4
2011-04-01 58.4
2011-05-01 58.4
2011-06-01 58.2
2011-07-01 58.2
2011-08-01 58.3
2011-09-01 58.4
2011-10-01 58.4
2011-11-01 58.5
2011-12-01 58.6
2012-01-01 58.5
2012-02-01 58.6
2012-03-01 58.5
2012-04-01 58.5
2012-05-01 58.6
2012-06-01 58.6
2012-07-01 58.5
2012-08-01 58.4
2012-09-01 58.7
2012-10-01 58.7
2012-11-01 58.7
2012-12-01 58.6
2013-01-01 58.6
2013-02-01 58.6



So is there anyone out there that still wants to insist that the employment picture in the United States is getting significantly better?

Anyone that wants to claim that “unemployment is going down” should at least wait until the unemployment-population ratio gets back up to 59 percent. Otherwise they just look foolish.

Yes, the Dow is at an all-time high right now. But a bubble is always the biggest right before it bursts.

Most Americans understand that the Dow has been pumped up with all of the funny money that the Fed has been printing. Most Americans understand that the stock market really does not accurately reflect the health of the U.S. economy as a whole.

Just consider these numbers…
  • The number of Americans on food stamps has risen from 32 million to 47 million while Barack Obama has been in the White House.
  • According to the U.S. Census Bureau, more than 146 million Americans are either “poor” or “low income” at this point.
  • Median household income in the United States has fallen for four consecutive years.
  • The number of homeless people sleeping in homeless shelters in New York City has increased by 19 percent over the past year.

No, the truth is that everything is most definitely not fine.

If everything is fine, then why did the Federal Reserve inject another 100 billion dollars into foreign banks during the last full week of February?

The U.S. government and the Federal Reserve are desperately trying to prop up the entire global economy. Unfortunately, the global financial system has been built on a foundation of sand and the tide is coming in.

Back in 2008, a derivatives crisis was one of the primary causes of the worst financial panic since the Great Depression.

So did we learn our lesson?

No, the boys on Wall Street are back at it again as a recent article by Jim Armitage described…
Historically, stock markets, being driven by humans, have tended to have a similar length memory of catastrophes, before making the same dumb mistakes again.

But it hasn’t even been five years since derivatives (on that occasion based on daft mortgages) blew up the world, and yet these exotic creatures have already returned. With a vengeance.

Research from Thomson Reuters declared that banks were creating more derivatives known as asset-backed securities than at any time since before the Lehman Brothers crash. Of those, 22 percent were made up of – and forgive me the alphabet soup here – CDOs and CLOs. The very type of derivatives that exploded last time. At this stage last year, only 6 percent fell into those categories.

In other words, banks are creating more of the riskiest types of the riskiest products.

At some point, we will have another derivatives crisis even worse than the last one.

When that happens, financial markets all over the globe will crash, economic activity will grind to a standstill and unemployment will go skyrocketing once again.

But as you saw above, we have never even come close to recovering from the last crisis.

So you can believe the mind-numbing propaganda that the mainstream media is trying to feed you if you want. Unfortunately, the reality of the matter is that we have not recovered from the last major economic crisis, and another one is rapidly approaching.

Five Poisons of Privatization

Monday, March 11, 2013 by Common Dreams
by Paul Buchheit



It gets more maddening every day. Essential human needs are being packaged into products to be bought and sold. The right to food and water, education, health care, public spaces, and unrestricted speech shouldn't be based on who can pay the most, or on who can generate profits with the slickest marketing pitch.

The free-market capitalism that drives our economy is a doctrine of individuals pursuing profit. Nothing else matters. An executive for Roche, a healthcare company, said "We are not in the business to save lives, but to make money."

With privatization of the common good we risk losing both our heritage and our humanness.

1. The Taking of Public Land

Attempts to privatize federal land were made by the Reagan administration in the 1980s and the Republican-controlled Congress in the 1990s. In 2006, President Bush proposed auctioning off 300,000 acres of national forest in 41 states.

The assault on our common areas continues with even greater ferocity today, as the euphemistic Path to Prosperity has proposed to sell millions of acres of "unneeded federal land," and libertarian groups like the Cato Institute demand that our property be "allocated to the highest-value use." Mitt Romney admitted that he didn't know "what the purpose is" of public lands.

Examples of the takeaway are shocking. Peabody Coal is strip-mining public lands in Wyoming and Montana and making a 10,000% profit on the meager amounts they pay for the privilege. Sealaska is snatching up timberland in Alaska. The Central Rockies Land Exchange would allow Bill Koch to pick up choice Colorado properties from the Bureau of Land Management, while neighboring Utah Governor Gary Herbert sees land privatization as a way to reduce the deficit. Representative Cliff Stearns recommended that we "sell off some of our national parks." One gold mining company even invoked an 1872 law to grab mineral-rich Nevada land for which it stands to make a million-percent profit.

The National Resources Defense Council just reported that oil and gas companies hold drilling and fracking rights on U.S. land equivalent to the size of California and Florida combined. Much of this land is "split estate," which means the company can drill under an American citizen's property without consent. Unrestrained by government regulations, TransCanada was able to use eminent domain in Texas to lay its pipeline on private property and then have the owner arrested for trespassing on her own land, and Chesapeake Energy Corporation overturned a 93-year-old law to frack a Texas residence without paying a penny to the homeowners. Most recently, the oil frenzy in North Dakota has cheated Native Americans out of a billion dollars worth of revenue from drilling leases.

Away from the mountains and the plains, back in the cities of Chicago and Indianapolis and L.A. and San Diego, our streets and parking spaces have been surrendered to corporations until the time of our great-grandchildren, with some of the highest profit margins in the corporate world.

2. Water for Sale

The corporate invasion of the water market is well underway. In May 2000 Fortune Magazine called water "one of the world's great business opportunities..[It] promises to be to the 21st century what oil was to the 20th." Citigroup is on board, viewing water as a prime investment, and perhaps the "single most important physical-commodity based asset class."

The vital human resource of water is being privatized and marketed all over the country. In Pennsylvania and California, the American Water Company took over towns and raised rates by 70% or more. In Atlanta, United Water Services demanded more money from the city while prompting federal complaints about water quality. Shell owns groundwater rights in Colorado, oil tycoon T. Boone Pickens is buying up the water in drought-stricken Texas, and water in Alaska is being pumped into tankers and sold in the Middle East.

A 2009 analysis of water and sewer utilities by Food and Water Watch found that private companies charge up to 80 percent more for water and 100 percent more for sewer services. Various privatization abuses or failures occurred in California, Georgia, Illinois, Indiana, New Jersey, and Rhode Island.

Of course, water monopolization is a global concern, and a life-threatening issue in undeveloped countries, where 884 million people are without safe drinking water and more than 2.6 billion people lack the means for basic sanitation. Whether in the U.S. or in the world's poorest nation, the folly of privatizing water is made clear by the profit-seeking motives of business:
  1. Water corporations are primarily accountable to their stockholders, not to the people they serve.
  2. They will avoid serving low-income communities where bill collection might be an issue.
  3. Because of the risk to profits, there is less incentive to maintain infrastructure.

3. Owning Human Life

Monsanto the devil
and their agro-chemical partners call themselves the "life industry."

In 1980 a General Electric geneticist engineered an oil-eating bacterium, effective against oil spills, and in the first case of its kind the Supreme Court ruled that "a live, human-made micro-organism is patentable subject matter." Fifteen years later a World Trade Organization decision allowed plants, genes, and microorganisms to be owned as intellectual property.

The results, not surprisingly, have been disastrous. One-fifth of the human genome is privately owned through patents. Strains of influenza and hepatitis have been claimed by corporate and university labs, and because of this researchers can't use the patented life forms to perform cancer research. Thus the cost of life-preserving tests often depends on the whim (and the market analysis) of the organization claiming ownership of the biological entity.

The results have also been otherworldly. In 1996 the U.S. National Institutes of Health attempted to patent the blood cells of the primitive Hagahai tribesman of New Guinea. U.S. companies AgriDyne and W.R. Grace tried to gain ownership of the neem plant, used for centuries in India for the making of medicines and natural pesticides. Other examples of 'biopiracy': The University of Cincinnati holds a patent on Brazil's guarana seed; the University of Mississippi holds a patent on the Asian spice turmeric.

Most tragically, tens of thousands of Indian farmers, charged for seeds that they used to develop on their own, and forced to repurchase them every year, have been driven to suicide after experiencing crop failures and ruinous debt.

Monsanto the devil is at the forefront of GMO seeds and litigation against vulnerable farmers. To date the company has won over half of its patent infringement lawsuits. The Supreme Court is currently weighing the arguments in Bowman vs. Monsanto the devil, which asks if a company can have a claim on a farmer whose crops were derived from a seed already paid for. More significantly, the question is whether a company can claim the rights to a form of life that has been nurtured by communities of farmers for centuries.

4. Owning the Air

In polluted Beijing, wealthy entrepreneur Chen Guangbiao is selling "fresh air" in a soft drink can for about 80 cents.

While Americans are not yet dependent on (real or imagined) breathing supplements, we have relinquished public access to the air in another important way: the 1996 Telecommunications Act led the way to a giveaway of the transmission airwaves to the broadcast media. Through an effective lobbying campaign the communications industry gained all the benefits of a lucrative public space without even a licensing fee. Objected former Senate Majority Leader Bob Dole, "The airwaves are a natural resource. They do not belong to the broadcasters, phone companies or any other industry. They belong to the American people."

Closely related is our right to freedom of expression on the Internet, which has been repeatedly threatened, despite the presence of existing copyright laws, by aggressive proposals like the Stop Online Piracy Act (SOPA) and the Protect IP Act (PIPA). Privacy is at risk with the Cyber Intelligence Sharing and Protection Act (CISPA), passed in the House despite objections by Ron Paul and others who recognize the "Big Brother" implications of government monitoring of Google and Facebook accounts. The Foreign Intelligence Surveillance Act has facilitated the monitoring of foreign communications in the name of anti-terrorism.

A 2011 UNESCO report offered this worrisome insight: "..the control of information on the Internet and Web is certainly feasible, and technological advances do not therefore guarantee greater freedom of speech."

5. Children as Products

Leading capitalists like Bill Gates and Jeb Bush and Michael Bloomberg and Arne Duncan and Michelle Rhee, who together have a few months teaching experience, have decided that the business model can pump out improved assembly line versions of our children.

Charter schools simply don't work as well as the profitseekers would have us believe. The recently updated CREDO study at Stanford concluded again that "CMOs (Charter Management Organizations) on average are not dramatically better than non-CMO schools in terms of their contributions to student learning.
 
Approximately the same percentages of charters and non-charters are showing improvement (or lack of improvement) in reading and math. In addition, poorly performing charters tend not to improve over time.

Nevertheless, charters remain appealing to poorly informed parents. The schools like to represent themselves as equal opportunity educational options, but the facts state the opposite, as many of them have strict application standards that ensure access to the most qualified students. Funding for such schools drains money out of the public system.

Children are viewed as products in another way -- on the school-to-prison pipeline. Many school districts employ "school resource officers" to patrol their hallways, and to ticket or arrest kids who disrupt the academic routine, no matter the age of the offender or the nature of the "offense":
  • A twelve-year-old was arrested for wearing too much perfume.
  • A five-year-old was handcuffed for committing "battery" on a police officer.
  • A six-year-old was called a "terrorist threat" for talking about shooting bubbles at a classmate.
Along with these bizarre instances is the frightening precedent set by a private prison, Corrections Corporation of America, which despite having no law enforcement authority was allowed to participate in a drug sweep at a high school in Arizona.

An Antidote?

A successful society doesn't derive from a few Ayn-Rand-type individuals. It's the other way around, as philosopher John Dewey reasoned in the 1930s. It's easy to forget that our country's greatest success was due to a collaborative effort in the years during and after World War 2, when advances in manufacturing and technology made us the strongest economy the world had ever seen. It was a shared success. The common good was not for sale.