Spinning Unemployment in a Collapsing Empire

America on the Rocks
By PAUL CRAIG ROBERTS

The Bureau of Labor Statistics (BLS) reported Friday that the economy gained only 103,000 new jobs in December--not enough to keep up with population growth--but the rate of unemployment (U.3) fell from 9.8 per cent to 9.4 per cent. If you are confused by the report, you are among the many.

In truth, what fell was not the number of unemployed people but the number of unemployed people who are actively looking for work. Those who have become discouraged and have ceased looking for work are not considered to be in the work force and are not counted as unemployed in the U.3 measure. The unemployment rate fell because discouraged workers increased, not because employment rose.

The BLS counts short-term discouraged workers (less than one year) in its U.6 measure of unemployment. That unemployment rate is 16.7 per cent. When statistician John Williams (shadowstats.com) adds the long-term discouraged, the US unemployment rate as of December 2010 was 22.4 per cent.

The question to ask yourself is: why do the media focus on the unemployment measure that does not count any discouraged workers? The answer is that the U.3 measurement only counts 42 per cent of the unemployed and makes the situation appear to be a lot better than it is.

Where are the 103,000 new jobs? As I have reported for years, the jobs are in non-tradable domestic services: waitresses and bar tenders, health care and social assistance (primarily ambulatory health care services), and retail and wholesale trade.

Today the United States has only 11,670,000 manufacturing jobs, less than 9 per cent of total jobs. Yet, despite America’s heavy dependence on foreign manufactures and foreign creditors, the idiots in Washington think that they are a superpower standing astride the world like a colossus.

John Williams reports that “the level of payroll employment still stands below where it was a decade ago, despite the U.S.population growing by more than 10 per cent in the same period. The structural impairments to U.S. economic activity continue to constrain normal commercial activity, preventing any meaningful recovery in business activity.”

Another way of saying this is that American corporations have taken American jobs offshore and given them to the Chinese. So much for big business patriotism.

Williams also reports that, unless it is finagled, next month’s BLS benchmark revision of payroll employment data will lower the level of previously reported employment by more than 500,000.

Federal Reserve chairman Ben Bernanke used his testimony before the Senate Budget Committee last Friday to warn that the U.S. government must get its budget deficit under control or “the economic and financial effects would be severe.” Here Bernanke is acknowledging that the Federal Reserve cannot indefinitely print money in order to finance wars and bailouts of the mega-rich.

But how is the government to get its budget under control? The U.S. government, regardless of political party or president, is committed to American hegemony over the world. The Congress has just passed the largest military budget in history, and there is no indication that any of America’s wars and military occupations are near an end.

The financial crisis is not over, with more foreclosures and more losses for the financial sector that will result in more taxpayer bailouts for those “too big to fail.” John Williams says that the double-dip is already happening, just disguised by faulty statistics, and that the deficit implications are horrendous and are likely to result in hyperinflation as the Federal Reserve will have to monetize the otherwise un-financeable deficits.

The dollar is also in danger, its role as reserve currency undermined by the Federal Reserve’s creation of more and more dollars. Temporarily, the dollar is buttressed by the grief that Wall Street’s sale of fraudulent derivative financial instruments to Europe has caused the euro.

The Republicans [ and complicit Democrats led by the President of the United States – Editors ] will try to destroy Social Security and Medicare in order to pay for wars and bailouts. If Americans are capable of realizing that they are threatened on a much greater level by the Republicans’ evisceration of the social safety net than they are by terrorists, the Republican assault on what they call “the welfare state” will fail.

The fallback target will be private pensions, assuming any survive plunder by the Wall Street investment banks. Pension funds could be required to invest in Treasury debt or they could face a levy. In the Clinton administration, Assistant Secretary of the Treasury Alicia Munnell proposed confiscating 15 per cent of all pension assets on the grounds that they had accumulated tax free. Certainly Washington will steal Americans’ pensions, just as Washington has stolen Americans’ civil liberties, in order to continue the empire’s wars of hegemony.

Increasingly, the rest of the world views America as the single source of its financial and political woes. While the superpower massacres Muslims in the Middle East and Central Asia, people in the rest of the world have learned from WikiLeaks that the U.S. government manipulates, bribes, threatens, and deceives other governments in order to have those governments serve the U.S. government’s interest at the expense of the interests of their own peoples.

The American Imperial Empire rests on puppet governments that are increasingly distrusted and hated by the peoples under their rule. Like the Soviet Union’s Eastern European empire, the American Empire is ruled not directly but through puppet states.

Puppet governments are caught between the empire’s power and the power of the local population. To the extent that Europeans have a moral conscience, they will find America’s foreign policy increasingly repugnant. To the extent that Muslim solidarity grows, the Muslim puppet governments that support America’s and Israel’s massacres of Muslims will find themselves threatened from within.

The American Empire is on the rocks, despite its vast arsenal of nuclear weapons and its control over the foreign and domestic policies of its subservient puppet states in Western and Eastern Europe, the United Kingdom, Canada, Australia, parts of Africa, the Middle East, Japan, Thailand, Indonesia, the Baltic states, Georgia, Kosovo, Mexico, Central America, Columbia, and, no doubt, others.

A country that is the font of war and oppression, whose dominance rests on the weak reed of puppet states, and whose economy is collapsing will not long remain dominant.

This Modern World

Don't go blaming guns

The shooter in Tucson could just as easily have used something else -- like, maybe, lawn furniture

By Tom Tomorrow

***

(I am a believer in the 2nd Amendment, but not a gun nut. It's just a sad fact that it's better to have a gun and not need it than to need a gun and not have it. And the cartoon IS funny.--jef)

The Crying Shame of John Boehner

(And he's too damn orange, too!--jef)

***

He's a lazy, double-talking shill for corporate interests. So how's he going to fare with the Tea Party?

by Matt Taibi, Rolling Stone (in the Jan 20, 2011 issue)

John Boehner is the ultimate Beltway hack, a man whose unmatched and self-serving skill at political survival has made him, after two decades in Washington, the hairy blue mold on the American congressional sandwich. The biographer who somewhere down the line tackles the question of Boehner's legacy will do well to simply throw out any references to party affiliation, because the thing that has made Boehner who he is — the thing that has finally lifted him to the apex of legislative power in America — has almost nothing to do with his being a Republican.

The Democrats have plenty of creatures like Boehner. But in the new Speaker of the House, the Republicans own the perfect archetype — the quintessential example of the kind of glad-handing, double-talking, K Street toady who has dominated the politics of both parties for decades. In sports, we talk about athletes who are the "total package," and that term comes close to describing Boehner's talent for perpetuating our corrupt and debt-addled status quo: He's a five-tool insider who can lie, cheat, steal, play golf, change his mind on command and do anything else his lobbyist buddies and campaign contributors require of him to get the job done.

As for what that job is, here's the thing: In this age of greed-enabling bailouts and rampaging Tea Parties and coast-to-coast voter rage toward the entire political process, Congress in particular now ranks as one of the single most unpopular political entities on earth. Recent polls show that only 13 percent of Americans approve of the job performance of their national legislature — which makes our elected representatives even less popular here at home than, say, Al Qaeda is in Pakistan. (Bin Laden and Co. scored an 18 percent approval rating not long ago.)

The reasons aren't hard to figure. Voters are fatigued not only by the seemingly endless kinky-sex and corruption scandals emanating from Capitol Hill, but also by the increasingly infuriating fact that no matter which party is in power, the leadership inevitably borrows like dice addicts on the Vegas strip and uses the money to pay for huge Frankensteinian initiatives that bloat the size and power of the federal government, often without semblance of sense or plan. The underlying dynamic is bought-off congressmen ignoring real social problems and using the legislative process to construct massive perpetual handouts for their campaign-contributor sponsors. Both parties have now made the servicing of the giant handout machine their primary raison d'être — and it's this perception, that Washington is occupied by an unbreakable bipartisan conspiracy of favor-churning hacks, that has inspired anti-Washington revolts like the Tea Party.

"Medicare Part D, No Child Left Behind, the Patriot Act — practically any significant piece of legislation that came out of the Bush presidency, it was a joke," says Chris Littleton, who heads a coalition of 58 Tea Party groups in Boehner's home state of Ohio.

The anger of Tea Partiers like Littleton erupted when they suddenly realized that their elected leaders in Congress had developed a primary allegiance not to constituents back home or even to ideology, but to themselves and their own dissolute, pay-for-play, you-scratch-mine, I'll-scratch-yours intramural bureaucratic calculus. Voters got mad when leaders covered up sex scandals, partied on corporate junkets when they should have been working on the public dime, wasted mountains of taxpayer money on political witch hunts instead of working to stave off another financial crisis or terrorist attack — and they got mad, especially, when congressional leaders stopped having the common decency to hide the lavish gifts funneled to them by their lobbyist pals in exchange for political favors, parading around in public with their goodies in hand without even caring how it looked.

The irony is, no one — no one — represents all of these bile-inspiring qualities better than John Boehner. His most striking achievement is that there's a check mark next to his name on virtually every entry on the list of common public complaints about Congress. And yet, when the Republicans rolled back into the control of the House this past November on the strength of a nationwide Throw-the-Bums-Out movement, it was Boehner, the prototypical bum, who somehow clambered onto the congressional throne. It's hard to imagine that in all of American political history there has been a more unlikely marriage than John Boehner and the pitchfork-wielding, incumbent-eating Tea Party, whose blood ostensibly boils at the thought of business as usual. Because John Boehner is business as usual, a man devoted almost exclusively to ensuring his own political survival by tending faithfully to the corrupt and clanking Beltway machinery. How? Let us count the ways.

From the very start, Boehner's career has been a heartwarming tribute to the gentle spirituality and tender human connections that surround the experience of congressional service. Here's how he got into the House in the first place: His predecessor, a white Republican named Donald "Buz" Lukens, got caught on camera talking with a black woman at a McDonald's in Columbus, Ohio, about how he had slept with her teenage daughter. It came out later that Lukens, his negotiating skills honed by years of public service, had paid 40 bucks to the girl to have sex with him in his Columbus apartment.

Convicted of "contributing to the unruliness of a minor," old Buz refused to resign his seat, and so John Boehner, a young plastics salesman (plastics!), took him on in the primary and won on a platform of restoring morals and ethics to the Congress. Boehner then joined up with a group of other freshmen congressmen, including God-humping Pennsylvanian Rick Santorum, and formed the so-called Gang of Seven. The group made names for themselves by giving sanctimonious speeches blasting Democratic congressional leaders for things like getting free haircuts at the House barbershop and free meals at the Senate restaurant. Shortly thereafter, Boehner ascended to a leadership role himself after helping co-author the "Contract With America," and it wasn't long before the man who swept into office in the shiny red underpants of an ethical crusader was creating his own peculiar ethics record.

Forget about free haircuts: Boehner was soon caught literally handing out checks from the tobacco lobby on the floor of the House. This was 1995; the House was voting to consider an end to federal subsidies of the tobacco industry, and Boehner, at the time the fourth-ranking Republican in the party hierarchy, went on the floor and handed out, by his own admission, "a half-dozen" donation checks from the tobacco lobby to various members.

Boehner only got busted when former-football-star-turned-GOP-congressman Steve Largent got wind of the check-passing and confronted Boehner about it. The fallout from the incident reveals the future House speaker at his absolute finest: While being interviewed by a television reporter about what he had done, Boehner with a straight face tries to turn the tables and present himself as an opponent of the practice.

"It's a practice that's gone on here for a long time that we're trying to stop, and I know that I'll never do it again," he deadpans. Asked how he feels about the episode, he says, "It's a bad practice. We've gotta stop it." While he may have stopped handing out checks on the floor of the House, Boehner didn't stop taking in lobbyist money and doing favors for his favorite industries. If you go back over his record, you'll find one instance after another of Boehner standing up on this or that issue in a way that dovetails perfectly with a pile of money that happens to have been sent to his PAC or his campaign fund from the industry that stood to benefit from his position. For years, Boehner was one of the largest recipients of campaign donations from UPS; by an amazing coincidence, he was also the sponsor of a bill that would have allowed companies that pay into group pension plans — like UPS — to cut pension benefits for their own employees if another employer in the group went out of business. In another curious connection between campaign funding and political favors, Boehner received hundreds of thousands of dollars from for-profit colleges and the private-student-loan industry — and then sponsored laws that restricted the Department of Education from making less expensive government loans to students, pushing for federal subsidies for private colleges and trade schools.

In the Nineties, Boehner started weekly meetings with a group of lobbyists, originally known as "The Thursday Group," that helped him develop close ties to companies like Citigroup, MillerCoors, UPS, Goldman Sachs, Google and R.J. Reynolds. And what does Boehner do with these lobbyists? Well, one thing we know he does is play golf — shitloads and shitloads of golf, which he apparently likes a lot more than, well, working. "Lazy" is how one former congressional aide describes Boehner's work ethic. "Not the hardest worker," said Joe Scarborough, former congressman and current MSNBC host. Congressional sources say that Boehner likes to knock off early, and that seems to square with his record, which reveals a real passion — for the links. He went on 180 junkets in six years, most of them golf trips, and reportedly copped to playing 100 rounds a year at a time when he was collecting a six-figure salary, paid for by the U.S. taxpayer, to serve in Congress. His political action committee spent almost $83,000 on golf events in 2009, and over the past 18 months he has run up a $67,000 tab at the Ritz-Carlton golf resort in Naples, Florida. He flew on a corporate jet 45 times between 2000 and 2007, and took at least 41 other corporate-sponsored trips in the past decade.

When he wasn't playing golf on some lobbyist's tab, Boehner was often sleeping in an apartment rented to him by industry pals; for years he lived in a posh two-bedroom apartment owned by John Milne, a Beltway lobbyist who represents health-insurance companies and restaurant chains, two industries with keen interest in the work of the House Education and Workforce Committee chaired by Boehner.

More than anything else, though, it's Boehner's skill at raising cash that gives him his power base in the House. In his most recent re-election effort, political action committees donated $2.4 million to Boehner's campaign fund, a staggering number for a House member. Boehner also raised some $44 million for other candidates.

Boehner's fundraising prowess is so legendary that his own office uses it as a defense against character attacks. When MSNBC's Scarborough caused a stir by accusing Boehner of being a light worker who's at bars every night by 5 or 6 p.m., Boehner's own spokesman Michael Steel shot back that "the only time [Boehner] is 'around town' these days is to raise money for our House Republican team. Thus far this year, he's headlined more than 230 events and raised about $27 million." At the time, the year was only half over — meaning, as one pundit pointed out, that Boehner was attending 1.25 fundraisers a day.

Look back over almost every controversial episode in the recent history of the U.S. Congress and you will find Boehner's face appearing, Zelig-like, somewhere in the foreground. He was a key figure in the historic waste of time that was his and Newt Gingrich's witch-hunting effort to get Bill Clinton impeached for lying about a blow job. He crossed the aisle to co-author the No Child Left Behind Act, a grotesque and grotesquely expensive expansion of federal power that helped jack up the federal education budget by an astounding 80 percent in the first five years of Bush's presidency, then voted for the obscene Medicare Part D, a staggering $550 billion handout to the pharmaceutical industry — two portentous initiatives that helped turn the Republicans into the new party of big government.

Then, in the middle of the Bush years, the man who got into office thanks to Buz Lukens' child-groping was enmeshed in his own sex scandal involving minors. When the news broke in September 2006 that Rep. Mark Foley, a Republican from Florida, had been sending sexually suggestive e-mails to a 16-year-old male page, it turned out that Boehner had been sitting on the information for months. Nancy Pelosi called for an immediate investigation into the Foley scandal, but Boehner blocked the resolution. Boehner later claimed that he had told then-Speaker Dennis Hastert about the Foley incident as soon as he found out — and promptly retracted his own alibi. The ensuing scandal nearly toppled Hastert, but Boehner survived mostly unscathed.

When he wasn't busy protecting sex offenders, Boehner was gracing the hallowed grounds of the Capitol building with all the dignity and class of a boxing promoter, calling one legislative deal a "crap sandwich" and blasting an Obama tax compromise as "chicken crap" (an unfortunate choice of words, given that massive amounts of poultry waste have created an ecological disaster in his own district). Boehner is also an innovator in the loathsome new political phenomenon of men crying in public, co-owning mastery of the habit with screeching media dillweed Glenn Beck.

But beyond all of that, Boehner just represents a certain type of hollowly driven, two-faced personality unique to the Beltway. It's not so much that he's likely at any moment to start pounding his fist in favor of something that only yesterday he was denouncing as a threat to the American way of life (when benchmarks in Iraq were a Democratic idea, Boehner said they would ensure failure; when George Bush came out for them, he said they were "very important"). Nor is it so much that he's prone to descending into hysterical hyperbole when the well-being of his campaign donors is threatened in even the vaguest way (he called the watered-down Dodd-Frank financial regulation bill "killing an ant with a nuclear weapon," with the ant in question being a financial crisis that wiped out over 40 percent of the world's wealth). It's more that . . . well, you have to spend a lot of time in Washington to know the type, but he's the kind of guy who would step over his mother to score a political point.

This is true almost in a literal sense. One congressional aide tells a story that goes back many years. Boehner's mother, Mary Ann, had just died. The aide, who at the time worked for a prominent Democratic congressman, suggested that his boss offer Boehner condolences. The Democrat, who had just heard that he was going to face an unexpected challenge from a state senator in his own re-election campaign, went along with the aide's advice, despite the fact that he didn't have a good relationship with Boehner.

The story goes like this: The Democrat approached Boehner, and said, "Hey, John, I'm sorry to hear about your mother."

Boehner, not missing a beat, shot back: "And I'm sorry to hear you have an opponent."

"That's John Boehner in a nutshell," the aide says now. "I mean, this is right after his mother died, and that's where his head was at."

Although there's a bit of an omaertà effect going on now that Boehner has risen to the speaker's chair, there are certainly members, particularly on the Democratic side and particularly in the Ohio delegation, who aren't shy about voicing opinions about Boehner's Machiavellian bluntness. Marcy Kaptur, the Ohio congresswoman who garnered nationwide attention back in 2008 when she urged people facing foreclosure to stay in their homes, crossed paths with Boehner last year when he publicly campaigned for Kaptur's opponent, Rich Iott, a lunatic whose weekend hobbies included dressing up in Nazi costumes in military re-enactments.

Iott denied that dressing up in the uniforms of the 5th SS Panzer Division meant that he sympathized with Nazi politics — but that didn't mean there weren't aspects of the Nazi regime that he could admire. "I've always been fascinated by the fact that here was a relatively small country that from a strictly military point of view accomplished incredible things," Iott said. Yet Boehner quietly continued to campaign for Iott even after his beaming Nazi photos were blasted over the national airwaves. "Boehner came to the district to campaign for him through the back door," says a Kaptur aide, "and left just as stealthily."

Kaptur and her staff were mystified as to why Boehner would back a nutjob in an SS costume, especially when Kaptur was so far ahead in the polls. They could come up with only two explanations, both humorously nauseating. One was that it was a personal thing to tweak Kaptur, who had recently held a press conference criticizing a Boehner proposal to raise the Social Security retirement age to 70. The other was that Boehner was milking the moronic Iott, the wealthy heir to a supermarket chain, for future campaign contributions.

"The fact that my opponent is among the wealthiest individuals not just in our region but in the nation leads me to believe Mr. Boehner, sadly, has his eye on the money that can be wrung out of him in the future," says Kaptur.

Another Ohio Democrat, Steve Driehaus, clashed repeatedly with Boehner before losing his seat in the midterm elections. After Boehner suggested that by voting for Obamacare, Driehaus "may be a dead man" and "can't go home to the west side of Cincinnati" because "the Catholics will run him out of town," Driehaus began receiving death threats, and a right-wing website published directions to his house. Driehaus says he approached Boehner on the floor and confronted him.

"I didn't think it was funny at all," Driehaus says. "I've got three little kids and a wife. I said to him, 'John, this is bullshit, and way out of bounds. For you to say something like that is wildly irresponsible.'"

Driehaus is quick to point out that he doesn't think Boehner meant to urge anyone to violence. "But it's not about what he intended — it's about how the least rational person in my district takes it. We run into some crazy people in this line of work."

Driehaus says Boehner was "taken aback" when confronted on the floor, but never actually said he was sorry: "He said something along the lines of, 'You know that's not what I meant.' But he didn't apologize."

Others in Washington see Boehner not so much as a bloodless partisan but as a clueless yutz, one who rose to power through a combination of accidents and bureaucratic inertia. "He's just sort of like, 'Oh, how did I get here?'" says one Democratic aide. "I think of him sort of as a big Saint Bernard to [new Republican Majority Leader] Eric Cantor's yapping Chihuahua." Boehner is the butt of a lot of jokes around the Hill, with his wino eyes, perennial Crayola-orange tan and phallic surname providing even members of his own party with endless comic material. (George Bush, famous for giving colleagues nicknames, called Boehner "Boner.") His pseudo-acceptance speech on the night in November when Republicans retook the House was brilliant clown theater, a Wayne's World version of a right-wing political rally. At the very moment when millions of GOP voters were celebrating their ouster of the great socialist enemy Obama in the name of patriotism and liberty, Boehner was tearing up over what an awesome job he had finally scored for himself.

"I've spent my whole life...[chokes up]...chasing...[chokes up]...the American dream," he sniffed. Becoming verklempt, Boehner waved his hands in a "No, I can't go on" gesture, then went on anyway, as the crowd nonsensically chanted "U-S-A! U-S-A!"

"I put myself through school, working..." — he choked up again — "every rotten job there was, and I poured my heart and soul into running a small business." The words "small business" were too much for Boehner to take (remember, this is a man who went on 180 corporate junkets in six years, who took 45 flights on private jets), and so he cried again, putting a fist over his mouth and squeaking "Uha!" before pronouncing himself "ready to lead." Boehner later repeated his election-night performance in a 60 Minutes interview with Lesley Stahl, not just crying but weeping — he looked like a Girl Scout watching a puppy get pushed through a meat grinder — as he flogged his "I've been chasing the American dream my whole life" act.

The cryfests have left Democrats rolling their eyes. "He cries sometimes when we're having a debate on bills," grumbled Nancy Pelosi. "If I cry, it's about the personal loss of a friend or something like that. But when it comes to politics — no, I don't cry."

And while all prominent politicians live half their lives in front of the cameras and have more than a few verbal hiccups to live down, Boehner seems to have an almost Yogi Berra-ish talent for grammatical violence and logic-defying goofball platitudes. This past summer, in a sage observation that Jon Stewart was moved to call "the most profoundly retarded statement I've ever heard," Boehner remarked that "the only way we're going to get our economy going again and solve our budget problems is to get the economy moving."

Adding to the perception of Boehner as more clown than tyrant is the widespread belief on the Hill that he doesn't really have much, if any, control over his Republican members. More than one Democratic aide describes Boehner as a man who in private negotiations is more than willing to work with the other side, and will make promises of Republican cooperation — only to have his even crazier right-wing members, especially the hyperambitious Eric Cantor, go off the reservation with lunatic amendments and resolutions within hours after Boehner has promised that everyone would be cool. "He's all talk," says one Democratic aide with long experience working with Boehner. "He has no ability to control his base. Look at the TARP vote in '08."

The Troubled Asset Relief Program — the $700 billion bailout of the absurdly irresponsible megabanks that got us into the financial crisis — is a classic example of what Boehner is all about, expressing perfectly his tenuous position vis-à-vis the hard-line anti-spending Tea Party base that thrust him into power. Boehner, who over the course of his political career has collected nearly $4 million from the finance and insurance sectors, backed TARP from the start, summoning his full rhetorical arsenal to argue for the bill.

"None of us came here to have to vote for this mud sandwich!" he declared during the infamous vote on September 29th. "I didn't come here to vote for bills like this!" Then he paused, took a $4 million gulp of air into his lungs, and pulled out all the stops to move his caucus — hilariously whipping out his Coffee Talk crying act on behalf of JP Morgan Chase and Goldman Sachs.

"So I ask all of you, both sides of the aisle," he said, tearing up. "What's in the best interest of our country? Not what's in the best interest of our party! Not what's in the best interest of our own re-election! What's in the best interest of our country!" He choked back tears again. "Vote yes!"

The fact that Boehner supported TARP and No Child Left Behind and mega-handouts to the pharmaceutical industry and a range of other federal subsidies is hardly surprising, for this is what mainstream Washington politicians of both parties do — they take great buttloads of money from giant transnational companies, play golf with the CEOs of those same companies ("If someone I've gotten to know on the golf course comes into my office with a good argument," Boehner once said, "I tend to want to listen"), and deliver taxpayer money back to their buddies when the need arises, or sometimes even when the need doesn't arise. In this regard, Boehner has had a lot more in common with campaign-contribution-devouring Democrats like Chris Dodd and Harry Reid than he has with the Tea Party Republican voters he now ostensibly represents.

Boehner, in short, has for most of his career been a Bush Republican, i.e., a corporate schmoozer and a remorseless spender of taxpayer money for whom the notion of small government is just something to say when the cameras are on, or when the public money in question might go to poor people or immigrants or other such unlikely golfers. This was a fine way to be during the 2000s, back when America was still unfucked enough to enjoy a phony real estate boom and launch recreational wars of conquest in the Middle East — but in this new decade, post-Bush and post-crash, there is serious doubt on the Hill that a reflexive favor-churner like Boehner will be able to keep delivering Republican votes to lavish taxpayer money on his industry pals. Money is simply too tight now, and people are too pissed off.

Getting Republicans to line up for the permanent extension of Bush tax cuts is one thing — GOP congressmen will never have a problem slashing taxes for the Lloyd Blankfeins and Jamie Dimons of the world. But there are TARP-like votes ahead that will prove to be the real indicators of whether or not Boehner leads the Republican caucus, or whether the caucus will end up leading him. Sometime in the spring, for instance, the Republicans will likely be forced to choose between raising the debt ceiling or shutting down the government. Refusing to raise the debt ceiling was an explicit campaign issue for many Tea Party-backed candidates, and in the wake of the election, several prominent Republicans, including dingbat party chief Michael Steele, have vowed to oppose any move to raise the debt limit next year.

"It's going to be really interesting to watch," says one Democratic aide. "Is Boehner going to let the Tea Party shut the government down?"

Boehner, somewhat predictably, has indicated an unwillingness to do so. Reflecting the sentiment of veterans in both parties, he calls raising the debt ceiling a procedural no-brainer, something that simply has to be done. After all, the modus operandi for Bush Republicans like Boehner has always been to talk a good game on spending cuts, so long as the cuts were coming out of the food-stamp program or aid to Katrina victims — but they would never go so far, or be so radical, as to cut overall spending, which would require scaling back the industry handouts they have spent so much time putting together on the golf courses of America. The Republican attitude toward spending during the Bush years was probably best summarized by Alaska congressman Don Young, author of the infamous $223 million "bridge to nowhere" earmark, who scoffed at the idea that spending for Katrina should be paid for by cuts to his transportation pork programs. Proponents of such offsets, Young said, could "kiss my ear."

So one can imagine how Boehner, who has funneled billions to big business over the years, would respond to the idea of shutting the government down. "Whether we like it or not," the new speaker-in-waiting told reporters right after the election, "the federal government has obligations. We're going to have to deal with it as adults."

This may in fact be a rare instance of Boehner being right. After all, the best way to reduce spending is probably to cut down on future obligations, rather than simply to default on the old ones you already passed. But in this case, the speaker has the misfortune of coming from a state with a highly organized and politically aware Tea Party that has absolutely no interest in being lectured about what's "adult" and what isn't.

"They're all worried the government would shut down," says Littleton, the head of the Ohio Liberty Council. "I don't care if it shuts down! So what?" Whether the Republican establishment led by Boehner can keep the support and approval of Tea Party leaders like Littleton over the next year or so is, right now, the most fascinating story line in all of American politics. The whole system of entrenched Beltway hackdom that Boehner represents is at stake. The GOP leadership largely succeeded this past fall in appropriating the political energy of the Tea Party for its own ends, pulling off a brilliant coup by using Tea Party rage to push through the long sought-after extension of the obscene Bush tax cuts. This was always going to be the model of how Republican Party hacks would deal with the Tea Party: Bash the living hell out of hated blue-state Gorgons like Nancy Pelosi and Barack Obama, jack off the mob by incorporating the Tea Party's Constitution-and-liberty rhetoric, hand the Tea Party those reforms that the GOP's big campaign contributors want anyway (most notably, tax breaks for the rich and deregulation of big business), and then cough up a note from the doctor or some other lame excuse when the time comes to actually cut spending.

Of all the longtime Republican Beltway hacks who are now scrambling to find ways to throw enough sunshine on the Tea Party mob to keep their jobs, Boehner has been the most hilariously transparent. In yet another scene straight out of a screwball comedy — maybe it was an early hommage to the now-departed Leslie Nielsen — Boehner in November 2009 stood up in front of a crowd of Tea Partiers who had gathered to protest the upcoming Obamacare vote, and tried to stroke his audience by holding up a copy of the Constitution. Professing his love for the sacred document, Boehner pledged to "stand here with our Founding Fathers, who wrote in the preamble: 'We hold these truths to be self-evident.'" The crowd was silent. Boehner had confused the Constitution with the Declaration of Independence.

Boehner's irrepressible hackosity is a serious problem for the Republican establishment, which desperately needs a more convincing con man to stave off voter anger on the right. In this regard, the contrast between Boehner and Littleton, the Tea Party leader in Boehner's home state, is interesting. The two men live in the same place, the small township of West Chester near Cincinnati, so Littleton is very familiar with Boehner. But Littleton's opinion of the Republican establishment couldn't be lower: It was precisely programs like the Medicare drug benefit bill and No Child Left Behind, programs he considers unacceptably wasteful and intrusive, that moved him to get into politics. "These were all Republican programs," Littleton says. "If you look at Republican congressmen from Ohio, they all voted for this stuff."

What's interesting is that the survival of the hack political class that Boehner represents now depends almost entirely on their ability to neutralize grass-roots leaders like Littleton — and the word "leader" here is used in the real sense of the word. While Boehner often negotiates for a Republican delegation that winds up rejecting the compromises he reaches, Littleton, when I speak with him, strikes me in exactly the opposite way — I feel very aware that I am talking to someone with a lot of political power, who represents quite a lot of actual human beings.

For obvious reasons, this is a real problem for the Republican Party establishment, which would forfeit any ability to squeeze the Goldmans and Citigroups of the world for golf vacations the instant they stop being able to deliver the votes for cushy spending bills and deregulatory goodies — votes that are now, at least in part, controlled by people like Littleton. This is why in some states the Republican Party fought so fiercely against the Tea Party; in Ohio, the party spent nearly $1 million campaigning to stop Tea Party candidates from assuming jobs at the state level. "They hate us more than they hate the left," says Littleton. "The left's just an enemy. We present a legitimate threat to them."

How do you get rid of a threat like that? Littleton recounts some of the ways the party has tried. One tack was dazzling the hayseeds with splendor and bullshit. During a visit to Washington, for instance, Littleton was meeting with Republican officials to go over "nitty-gritty" stuff like monetary policy, when an aide suddenly stopped the session. He was surprised, he told Littleton, that they were bothering with all this serious stuff — he thought the Tea Partiers just wanted to meet famous politicians. The aide's attitude, Littleton recalls, was: "I thought we could just throw you a bone, and bring in my rock star, and you're just really so impressed by him that you're going to smile and hug him and go out and do whatever we need you to do." Another time, when the Tea Party was making noise about a farm subsidy, a staffer for a prominent Republican congressman simply called Littleton up and asked him to be quiet. "Hey, would you mind leaving that issue alone?" the staffer said. "The congressman would really appreciate it — we work with a lot of farmers." Littleton was amazed that Republican leaders seemed to think the Tea Party was engaged in a collaborative effort to keep Republicans in office, but this is just the way things are done inside the Beltway. Everything's negotiable, everyone's pals with everyone else, and the only thing that matters is keeping the right people in office.

Littleton has also been approached with offers of corporate funding from the energy interests as well as FreedomWorks, the much-publicized national umbrella organization led by Dick Armey. While many Tea Parties across the country have been happy to accept such largesse, Littleton was unimpressed. When FreedomWorks offered to set up a rally in Ohio during the heat of the election season, it turned out that Armey only wanted to get a crowd together to hawk his new book, Give Us Liberty: A Tea Party Manifesto. "We're here in trench warfare," Littleton says, laughing, "and they're on a book tour."

This is where Boehner comes in: He represents the last stand of the Bush Republicans against this rising tide of public anger. The GOP establishment want the energy of the Tea Party, but they don't want to have to work for it. They're hoping — and they have plenty of reasons to have this hope — that the vast majority of Tea Partiers will be dazzled by their new status in Congress, or be willing to be bought off with corporate money, or be just plain dumb enough to fall for whatever pulled-out-of-the-ass phony reform rhetoric that guys like Boehner come up with, instead of making real changes to the way Congress does business. In a hilarious example of the former, Boehner with a straight face recently announced that he would push to cut committee budgets and member allowances by five percent, for an anticipated savings of — cue the clueless Dr. Evil laugh — $30 million. "It likely would be one of the first votes we cast," Boehner declared proudly, failing to recognize that paying for trillion-dollar bailouts and $900 billion tax breaks by cutting $30 million at a time is a little like planning a hostile takeover of IBM with a stack of Rite Aid coupons. That's not government; it's stand-up comedy. As for the sweeping changes that the Tea Party is looking for — Littleton's personal litmus test is deep cuts in both defense spending and Social Security — it's virtually unimaginable that Boehner will push for such a radical agenda. When Littleton met with party leaders after the election and asked what programs they are willing to cut, he was brushed aside. "We're going to be discussing that in April," he was told.

"I thought to myself, 'You campaigned on an entire platform of cutting government spending, and you don't know what you're going to be cutting until April?'" Littleton pauses. "I don't trust these guys — whether it's Boehner or anybody else."

It was good times in America for a while. A man could wait for his local congressman to get caught diddling a 16-year-old, make a run for his seat, and then spend the next 20 years getting hustled around the world on golf junkets and showered with campaign checks and apartments and corporate-jet flights, and nobody would utter so much as a peep of protest. Congress was an easy job for any man with a nice fairway stroke, a limited moral compass and a keen sense of bureaucratic loyalty; it was half an acting job and half clerical work, taking orders from industry captains and selling the resultant giveaway bills to your voters as principled blows for Adam Smith, the flag and the free-enterprise system. Back when America was still a feared international bully that was flush with borrowed Saudi and Chinese cash and could stand to blow a few hundred extra billion in public funds every year on budget-padding deals — back in the Bush years — John Boehner was the perfect candidate for congressional leadership, a lifetime company man who didn't give a shit about most Americans but could shed tears on national television on behalf of Jamie Dimon's bottom line.

Things are different now. America is so broke, there's no longer really any money in the Treasury to give away — the job of overseeing corporate handouts that used to belong to the leaders of Congress has now moved to the Federal Reserve, which itself is so broke that it has to invent dollars out of thin air before it can give them away to influential billionaires. This leaves congressional leaders with nothing to do but their ostensible jobs — i.e., fixing the country's actual problems — and few of the current leaders have any experience with that, Boehner being a prime example. The new speaker represents an increasingly endangered class of Beltway jobholders who know how to raise money and get elected, but not much beyond that. He now finds himself the party's last line of defense against millions of angry voters who, for the first time in recent memory, are at least attempting to watch what Congress is up to. The tee times are over.

Quote

"Men fight for liberty and win it with hard knocks. Their children, brought up easy, let it slip away again, poor fools. And their grand-children are once more slaves." ~ D.H. Lawrence

Hackers find new way to cheat on Wall Street

Hackers find new way to cheat on Wall Street -- to everyone's peril
Published on 01-10-2011
Source: InfoWorld

High-frequency trading networks, which complete stock market transactions in microseconds, are vulnerable to manipulation by hackers who can inject tiny amounts of latency into them. By doing so, they can subtly change the course of trading and pocket profits of millions of dollars in just a few seconds, says Rony Kay, a former IBM research fellow and founder of cPacket Networks, a Silicon Valley firm that develops chips and technologies for network monitoring and traffic analysis.

Kay, an Israeli-born computer scientist and one-time Intel engineering manager, says the root of the problem is the increasing speed of networks; as they get faster and faster, our ability to actually understand events taking place within them isn't keeping up. Network monitoring technology can detect perturbations in network traffic happening in milliseconds, but when changes occur in microseconds, they're not visible, he says.

cPacket has developed a proof of concept showing that these side-channel attacks can be used to create tiny delays in the transmission of market data and trades. By manipulating specific trading activities by several microseconds, an attacker could gain unfair trading advantage. And because the operation occurs outside the range of monitoring technology, it would remain invisible. "We believe that such techniques pose a substantial risk of creating unfair trading, if used by the wrong people," Kay says.

(A side-channel attacker looks at indirect information related to the computer -- the electromagnetic emanations from screens or keyboards, for example -- to determine what is going on in the machine. )

Latency threatens other applications as well

The lack of visibility into high-speed networks is of concern to more than the financial community. Managing traffic on today's 10Gbps and faster networks is becoming difficult, resulting in degradations of performance, particularly to virtualized systems. "It's difficult to take corrective actions when you can't really see what's taking place," Kay says. "If you cannot measure network latency, you cannot control it and cannot improve it."

In a PDF whitepaper on latency, Kay wrote, "Traditionally, applications that have latency requirements include: VoIP and interactive video conferencing, network gaming, high-performance computing, cloud computing, and automatic algorithmic trading. For example, one-way latency for VoIP telephony should generally not exceed 150 milliseconds (0.15 seconds) to enable good conversation quality, while interactive games typically require latencies between 100 and 1,000 milliseconds. However, the requirements for automated algorithmic trading are much more strict. A few extra milliseconds, or even a few extra microseconds, can enable trades to execute ahead of the competition, thereby increasing profits."

Indeed, latency, even at the very highest speeds, is so concerning that researchers at MIT recommended  any organization dealing in complicated time-sensitive global interactions should take a hard look at where they locate their data centers.

The MIT researchers even suggested that financial firms could gain some advantage by taking advantage of limitations posed by the speed of light. For example, it typically takes about 50 milliseconds to send a message from New York to London. Placing a server between the two could cut the speed of communication in half, they said, which may be enough time to take advantage of some momentary pricing discrepancy. Trading on that discrepancy is known as arbitrage, and it's becoming increasingly common.

Lessons of the "flash crash"

The vulnerability of markets in which high-frequency trading is common became all too evident last May, when exchanges experienced a "flash crash" that drove the Dow Jones down about 600 points in just five minutes. The incident was not the result of deliberate manipulation, but it shows just how dependant the financial world is on technology it doesn't really understand.

"Financial institutions and exchanges with [high-frequency trading] are spending millions to improve latency by microseconds and at the same time can't measure the data at that resolution in real time. It's disturbing," Kay says.

A side-channel attack on a high-frequency trading network is analogous to a denial-of-service attack. In a typical DoS attack, bots flood a target website with enormous numbers of hits, often causing a crash. A side-channel attack would be infinitely more subtle, but it would still function by adding extraneous packets to a legitimate data stream. Those extra packets slow the data just enough to give someone else a chance to move first in the market.

Kay says he does not know if anyone has yet launched a side-channel attack against a high-frequency trading network -- but it worries him. And it worries me. Financial markets are supposed to be a level playing field. They're not, of course. Small players, like the millions of us who invest for our 401(k)s and other retirement accounts, are at an immense disadvantage even when everything is kosher. But the proliferation of high-frequency trading widens the gap even more. If someone can really take advantage of a weakness in those networks, we're all really in trouble. And that's just another reason why more -- not less -- regulation is required in the financial markets.

Horse Meat in US Diet?

Put Horse Meat in US Diet, Slaughter Groups Say
01-10-2011
Source: CBS

(AP) LAS VEGAS - Ranchers and horse owners in the United States should be allowed to slaughter their animals and sell the meat as food, said dozens of breeders, trainers and lawmakers gathered in Las Vegas this week to revive the nation's shuttered horse processing industry.

The first Summit of the Horse on Tuesday drew advocates from across the West who slammed animal rights groups and implored the federal government to once again embrace horse meat as a legal source of nutrition, saying horse meat is already safely consumed in dozens of countries.

Sue Wallis, a Wyoming legislator and vice president of United Horsemen, said horse processing is the humane and ethical solution to controlling horse populations.

"What's happening is we've taken a valuable asset and turned it into a very expensive liability," she said. "The United States will become like Europe, where only the very wealthy will be able to afford horses."

Congress ended the killing of horses for human consumption in 2007 after animal-rights activists objected to the way the animals were treated.

Bureau of Land Management chief Robert Abbey is scheduled to address the conference late Tuesday to discuss problems created by growing populations of feral horses.

Abbey has expressed opposition to horse euthanasia but still faces criticism from animal rights groups for agreeing to face the pro-slaughter advocates in Nevada - a state that is home to nearly half of the nation's wild horses and burros.

Animal rights activists planned to host a protest against the horse summit Tuesday.

Horse processing proponents said the federal government's policy of rounding up excess horses and storing them amounts to public welfare for horses. The Bureau of Land Management spent $36.9 million in 2010 to feed and care for horses rounded up and confined in corrals.

Critics also portray the federal program as a job killing solution that undercuts the West's tradition of ranching and meat processing.

"The Chinese are chomping at the bit to buy our horses," said former U.S. Rep Charlie Stenholm, D-Texas. "The Russians are chomping at the bit to buy our horses. Why can't we sell it to them?"

Feral horses compete with other wildlife for forage. They can quickly overwhelm an area because they have long life spans and are unlikely to be threatened by predators or disease. The Bureau of Land Management estimates wild horses could double their population in four years if left unchecked.

Wallis of United Horsemen said extreme environmentalists have pushed policy that has allowed wild horses to overrun the West and U.S. markets to devalue privately owned horses.

Since 2007, some horses have been trucked to Canada and Mexico for slaughter, an expensive business cost that has rendered the horse industry unprofitable, slaughter advocates argue.

Some say over-breeding, not the slaughter ban, has caused the overpopulation problem.

"Just like the housing industry over saturated itself and collapsed, the horse breeding industry is self-destructing and bringing down horse values, and horse slaughter is their bail out," Simone Netherlands, a natural horsemanship trainer from Arizona and founder of Respect4Horses.

Netherlands said federal horse policy threaten horses and could eventually lead to their extinction.

Economists foretell of U.S. decline, China's ascension

 (Again, I can't stress this enough: when you see mainstream media talking heads report on the economic recovery, they are spouting nonsense. We are being placated, because the powers that be know most Americans will panic and make bank runs and riot, and make things worse. By the way, if you are going to withdraw your funds in anticipation of ill economic winds, do it soon before you lose the ability to do so.--jef)


US Economic Decline
by Mark Felsenthal
Reuters US Online Report Business News
Jan 09, 2011

DENVER (Reuters) - To hear a number of prominent economists tell it, it doesn't look good for the U.S. economy, not this year, not in 10 years.

Leading thinkers in the dismal science speaking at an annual convention offered varying visions of U.S. economic decline, in the short, medium and long term. This year, the recovery may bog down as government stimulus measures dry up.

In the long run, the United States must face up to inevitably being overtaken by China as the world's largest economy. And it may have missed a chance to rein in its largest financial institutions, many of whom remain too big to fail and are getting bigger.

On the one hand, Harvard's Martin Feldstein said he believes the outlook for U.S. economic growth in 2011 is less sanguine than many believe.

First, the boost to growth from government spending will be drying up this year, he said. Renewal of expiring tax cuts is no more than a decision not to raise taxes, and the impact of one-year payroll tax cut is likely modest, he said.

"There's really not much help coming from fiscal policy in the year ahead," he said. Woes from the dire situations of state and local governments may actually be a drag on growth, he said.

Growth got a lift from a lower saving rate in 2010, but that probably will not last this year as households worried about an uncertain future return to paring back debt and socking more away, Feldstein added. Discouraging declines in home values mean there is less to save from, he said.

"People are worried, so there's a strong reason for precautionary saving," he said.

THE RACE IS ON

On the other hand, there is the race with China and the dynamic Asian economies, including India. Most estimates put the size of the Chinese economy on par with the United States by the early 2020s, said Dale Jorgenson, also of Harvard.

Jorgenson sees Asian emerging markets as the most dynamic in the world, eclipsing other emerging market contenders such as Brazil and Russia with steady growth over the next decade.

"The rise of developing Asia is going to accompany slower world economic growth," he said.

The United States will need to come to terms with the fact that its prevalence in the world is fated to come to an end, Jorgenson said. This will be difficult for many Americans to swallow and the United States should brace for social unrest amid blame over who was responsible for squandering global primacy, he said.

MIT's Simon Johnson put it more bluntly, saying the damage from the financial crisis and its aftermath have dealt U.S. prominence a permanent blow.

"The age of American predominance is over," he told a panel. "The (Chinese) Yuan will be the world's reserve currency within two decades."

Johnson said he believes the United States has failed to learn its lesson from the financial crisis and continues to implicitly back its largest financial institutions.

"I'm concerned about the excessive power of the largest global banks," he said. "Who are the government-sponsored enterprises now? It's the six biggest bank holding companies."

To be sure, Raghuram Rajan, a former IMF chief economist now with the University of Chicago's Booth School of Business, could still envision an ongoing U.S. leadership role.

Nothing proceeds in a straight line, he said, and there are many pitfalls along the way even for dynamic Asian economies.

"I would say the age of American dominance may be nearing an end. But America as the biggest mover will be in place for a long time," he said.

Consumer Product Safety Commission to launch public database of complaints

By Lyndsey Layton - Washington Post Staff Writer
Monday, January 10, 2011

The federal government is poised for the first time to make public thousands of complaints it receives each year about safety problems with various products, from power tools to piggy banks.

The compilation of consumer complaints, set to be launched online in March by the Consumer Product Safety Commission, has been hailed by consumer advocates as a resource that will revolutionize the way people make buying decisions.

But major manufacturing and industry groups have raised concerns about the public database, saying it may be filled with fictitious slams against their brands. Competitors or others with political motives could post inaccurate claims, business leaders say, and the agency will not be able to investigate most of the complaints.

Arguing that this could present a new burden in an already difficult economic environment, they are working behind the scenes to delay or revamp the project.

"We're not opposed to a database," said Rosario Palmieri, vice president of the National Association of Manufacturers. "We're opposed to a database that's full of inaccurate information."

Agency officials say they have built in safeguards to prevent such abuse and have carefully balanced the interests of consumers and manufacturers. On Tuesday, they will offer the public an online preview of how the database will work.

The new system was created as part of a landmark consumer product safety law passed by Congress in 2008. It has taken shape amid bitter partisan divisions at the CPSC, with Democratic appointees backing it and Republican appointees deriding it as a waste of taxpayer money that could damage businesses.

The CPSC already collects reports of defective products from a wide range of sources, including consumers, health-care providers, death certificates and media accounts.

But most of that information is shielded from public view. Until now, the only way for consumers to access safety complaints is to file a public-records request with the CPSC. The agency is then required by law to consult with the manufacturer before releasing information about their products, and the company can protest or sue to stop disclosure.

If the agency thinks a dangerous product should be pulled from the market, it must negotiate a recall with the manufacturer, a process that can take months or years.

Meanwhile, unwitting shoppers can continue to buy the item.

Under the new system, a complaint filed by a consumer will be posted for anyone to read within 15 days.

"This is a world of sunshine that we think will be tremendously beneficial to consumers," said Ami Gadhia, policy counsel at Consumers Union.

C. Gibson Vance, president of the association of trial lawyers, said in written comments submitted to the CPSC that the database will amount to an early-warning system. He pointed to the example of toxic drywall imported from China.

"Had this database been available, both the CPSC and American consumers likely would have been able to determine that there was, in fact, a systemic problem with drywall from China and stopped using it," he wrote. "Without this database in place, it took the CPSC and the general public approximately three years to conclude that there was in fact a problem."

Rachel Weintraub, a lawyer and director of product safety at the Consumer Federation of America, cited the example of drop-side cribs, which were banned after they were linked to a string of infant deaths.

"With cribs, we know that consumers reported safety incidents involving drop-side cribs to manufacturers and were told 'Oh, we don't know of any other incidents', when in fact they knew of many," she said. "This will create a new generation of more educated consumers."

But for industry groups, the new system is plagued by troubling rules, including that it allows complaints from a broad array of people, including trial lawyers and consumer groups, even if they lack direct knowledge of the defective product.

"This can create a database full of misinformation, that will be of less use to the consumer," Palmieri said. What's more, despite a disclaimer on the database that the CPSC cannot guarantee the accuracy or completeness of the complaints, it will carry the imprimatur of the federal government, he said. "When the CPSC as a government organization publishes this information . . . it gives it weight and credibility."

Under the new system, when a consumer files a complaint, the CPSC has five days to notify the manufacturer, which in turn has 10 days to respond. A company can challenge the complaint as false, argue that it will give away a trade secret, or submit a response. The response will be published alongside the complaint in the database.

If a company says a complaint is false or would disclose confidential business information, the CPSC will decide whether to withhold or publish the complaint.

Those safeguards will protect companies, agency officials said.

Anyone filing a complaint must identify themselves, but that information will not be published and would be disclosed to the manufacturer only with the consumer's permission.

The database will not include peeves about reliability or quality, only information about defects that can cause injury or death. And it is restricted to the 15,000 types of consumer goods overseen by the CPSC, which do not include food, drugs, medical devices, cosmetics, tobacco, automobiles or tires.

Only one other federal agency - the National Highway Traffic Safety Administration - keeps a similar database. That database allows consumers to post complaints about cars, tires or child car seats but does not permit manufacturers an opportunity to post a rebuttal.

CPSC Chairman Inez Tenenbaum says the database will be rolled out on time despite pushback from the business community. "The consumer database is on budget and on schedule to be launched in March," she said last week.

The agency, which received about 16,000 consumer complaints in 2009, does not know how many to expect in the new system, according to spokesman Scott Wolfson.

Tenenbaum and the other two Democrats on the CPSC trumpeted the final version of the database as a powerful tool for consumers, while the two Republicans, Anne Northup and Nancy Nord, were opposed.

After the vote, Northrup released a statement that said the CPSC opted to create a database that "wastes taxpayer money, confuses and misleads consumers, raises prices, kills jobs, and damages the reputations of safe and responsible manufacturers."

Nord said the move was "another example of poorly conceived and excessive regulation that, sadly, has become the norm at CPSC."

The database, which is scheduled to be launched March 11, will be available at www.saferproducts.gov.

AT&T's Man in the White House

Saturday, January 8, 2011 by Save the Internet

by Timothy Karr

When President Obama said he was going to "bring change to Washington," no one expected William Daley to be his choice to get the job done. 

Obama's incoming chief of staff is about as corporate friendly as any Democratic insider can be, which is saying a lot. 

For supporters of an open Internet, Daley's appointment raises the prospect that the president will break all promises to defend Net Neutrality at the urging of a chief of staff determined to cozy up with industry and protect the status quo. 

The outlook for any progress under Daley is dim. 

Daley currently serves as a top executive at J.P. Morgan Chase & Co -- concerning those who had hoped to see this president rein in a reckless financial sector.

Daley once told the New York Times that the Obama administration had "miscalculated" by moving too far to the left on health care reform -- concerning those who had hoped the president would fight Republican efforts to repeal the law. 

Daley served as a special counsel to President Clinton in 1993, helping the administration's successful push to ratify NAFTA -- concerning those across the labor movement, who delivered supporters to Obama by the busload. 

It's worse for advocates of open and democratic media. From 2001 through 2004, Daley led lobbying efforts for SBC Communications, Inc. His first assignment was to lock in the company's local monopolies while allowing it to charge extortionate rates for competitors seeking to share SBC's lines, defying a basic communications principle known as "common carriage."

He was a top executive at SBC as the company laid the groundwork for its 2005 takeover of AT&T Corporation, after which it rebranded the merged entity as AT&T Inc. During that time, Daley worked very closely with Randall Stephenson, who has since risen through the ranks to become AT&T CEO and chairman. 

He joined Stephenson and former AT&T CEO Ed Whitacre in a 2002 meeting to lobby the FCC's top brass for industry deregulation. Daley, Stephenson and Whitacre wanted the FCC to declare that high-speed Internet access would no longer be considered a "telecommunications service," but rather an "information service." The regulatory change would give phone and cable companies broad latitude to raise prices, stifle competition and control consumer choice on the Web.

An all-too-compliant FCC obliged later that year, removing high-speed Internet access services from regulation under common carriage. Daley supported this radical move, which reversed the long-held rule establishing nondiscriminatory communications networks as essential to economic opportunity and innovation. (Read Aparna Sridhar's 2010 report for a good history of this deregulatory process). 

In so doing, the FCC undercut its own ability to keep Internet providers from gutting Net Neutrality and interfering with our right to connect to any website, service or application on the Web.

AT&T Stakes Its Claim to the Oval Office

Now companies like Comcast and AT&T are vying to be the Internet's new gatekeepers -- creating special lanes for their own websites and services, or for those of a few big corporate partners, while leaving the rest of us on a digital dirt road.

However you look at it, there are very few degrees that separate Daley from his successor at AT&T, James Cicconi, who now leads lobbying efforts for the communications giant. 

Daley's appointment to the White House brought praise from the U.S. Chamber of Commerce, where Cicconi serves as a director. The Chamber marches in lockstep with AT&T in opposing Net Neutrality. Working together, the two groups have been very effective in buying up opposition to Net Neutrality among Democrats and Republicans alike. 

AT&T is the largest single corporate contributor to congressional campaigns, since 1989 giving more than $45 million in donations to both Republican and Democratic candidates. It spent nearly $13 million on DC lobbyists just in 2010. 

AT&T has staked out the legislative branch. With Daley to start work in days, it can now make a claim to the White House, too. 

Thus far, AT&T-funded Republicans have introduced one bill, designed to strip the FCC of its power to protect the open Internet. The president was expected to veto this and other anti-Net Neutrality legislation should it make its way to his desk. 

But with Daley at his side, how long will it be before Obama caves?

Homeland Security Encourages Americans to Spy and Report on Their Neighbors

The federal government's new anti-terrorism program promotes spying and incites fear among ordinary citizens.
By G.W. Schulz, Center for Investigative Reporting
January 10, 2011

Urging everyday Americans to report suspicious activity they believe could be linked to terrorism remains a leading priority for Barack Obama’s homeland security secretary, Janet Napolitano. Bridge workers, shopping retailers, hoteliers, garbage collectors, patrol officers and your next-door neighbor have all been encouraged to notify authorities if they witness something out of the ordinary.

The program is rolling out state by state, and local police as well as private businesses like Minnesota’s Mall of America are joining in the campaign to help officials compile evidence of possible terrorism in databases and analyze it as intelligence for leads.

An earnest-looking Napolitano appeared in a “see something, say something” public-service announcement at the height of the holiday season that aired near checkout stands for Walmart shoppers as they waited to ring up cartloads of plastic goodness. Some Internet commentators jeered, calling Napolitano “Big Sister” and Walmart shoppers something worse. The video may have done more to spark a debate about suspicious activity than anything else so far.

One issue is that “out of the ordinary” remains elusive. As the program grows, it’s difficult to imagine citizen surveillance won’t suffer from the same disapproval that befell similar Bush-era plans, like the now-defunct Operation TIPS, which enlisted utility employees, long-haul truckers and postal workers to keep an eye out for bad guys.

CNN’s Candy Crowley offered a typical response to the resurrected initiative last month while interviewing Napolitano: “It just sounds very Big Brother to me, turning in the next-door neighbor.” Americans may believe they’re already responsible enough to report conduct that seems truly out of the ordinary, and arguably, few would neglect to speak up if their neighbor was burying C4 in the front yard.

On the other hand, security experts told Congressional Quarterly recently that the Homeland Security Department is simply doing its job by conditioning Americans in an age of peril to both be aware of threatening behavior and report it. Americans are freedom-loving enough not to spy needlessly, one of them said. Added Rich Cooper of the security consulting firm Catalyst Partners:

The department will always be in a damned-if-you-do, damned-if-you-don’t situation when it comes to information. People need to get a life and take a look at the proactive piece of this. They’re looking for a conspiracy where none exists.

Two new documents required for some government intel systems became publicly available just in recent weeks and provide fresh though slim details about what actually happens after police and civilians alert the government to suspicious activity. According to the first, a desk officer at the DHS National Operations Center receives a tip that, say, someone was observed snapping photographs or drawing sketches of a government building or chemical manufacturing facility.

The officer then determines if it’s “credible” and “possibly linked to terrorism and/or criminal behavior” before writing up what’s called a “patriot report.” These patriot reports can contain rich details about an individual “engaged in and/or connected to the suspicious activity” – name, gender, age, race, ethnicity, Social Security number, driver’s license number, birth date and distinguishing features. Anything’s conceivable, even a “reliability rating of the informational source,” presumably for indicating the trustworthiness of your neighbor or local beat officer who reported the suspicious activity.

From there, patriot reports flow outward to other DHS personnel, the FBI’s own 24-hour counterterrorism center and the dozens of state and local fusion centers constructed since Sept. 11 for swapping and analyzing terrorism data.

But what happens if authorities discover there is no credible threat? A second document says the government could hold at least some records anyway:

There is a privacy risk that records containing [personally identifiable information, e.g. birthdates] collected under the SAR initiative will be deemed to not qualify as suspicious activities after further investigation and analysis but will be retained in the system.

Much of the contact police have with the public is governed by legal concepts like “probable cause” and “reasonable suspicion” that require evidence of a crime. Suspicious activity isn’t a new legal phenomenon, but it has created a new, potentially vast stream of intelligence and sensitive personal information for the government to collect without absolute clarity about what should be considered genuinely suspicious.

By Jan. 3, Congressional Quarterly had decided that “unexpected opposition” was growing due to criticism that the federal government’s suspicious activity program “promotes spying and incites fear.” “Backlash,” as the headline described it, is probably an overstatement. Few Americans are even aware of the program’s breadth to begin with, but the Washington news service did point to online reaction over Napolitano’s video appearance at hundreds of Walmart stores.

There are other nagging questions in the meantime. Florida generated thousands of suspicious activity reports for a pilot program, but how many of them could confidently be linked to terrorism or crime? A Los Angeles police commander told Congress in 2009 that of 1,400 reports there, four led to arrests with no indication of whether they were connected to terror. Will data systems and intelligence analysts become overwhelmed by the deluge of new and not-always-reliable information? For now, Uncle Sam and his sister want you to keep an eye out.

Who's To Blame for Our Polluted Tap Water?

(Water and access to safe drinking water are to me the biggest issue under the radar. We all need it, and big corporations are doing everything they can to either obtain it and sell it at ridiculous mark ups, or pollute it so bad, it destroys whole regions of crops and people's lives. From Nestle and T. Boone Pickens buying up any aquifers and springs everywhere and selling it at prices most poor people can't afford, or the Natural Gas Industry destroying the water table in Pennsylvania with their fracking (so that folks can light their tap water on fire!), big corporations are out of control. Destroying access to water will be an extinction event if someone doesn't figure out how to stop these greedy shortsighted corporate dicks.--jef)

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The real culprits are the industries that dump pollutants into our water, and the elected officials who are failing to fund our drinking and waste water systems.
By Wenonah Hauter, AlterNet
Posted on January 8, 2011

Recent coverage of the revelations of increased levels of hexavalent chromium (also known as chromium 6) in some of our nation's water supplies vilified the wrong institutions: our municipal water utilities. The real culprits are the industries that dump this and other pollutants into our drinking water sources, and the elected officials who are short-sightedly failing to fund our drinking and wastewater systems.

I repeat: tap water and the public agencies that provide it are not the enemy.

A vital resource, tap water is sometimes taken for granted until something goes wrong. Unfortunately, this lax attention often starts at the federal level, where not enough money is allocated to modernizing and maintaining public drinking water systems, and a blind eye is often turned to the ways in which industries are allowed to exploit and pollute them.

While hexavalent chromium can end up in water naturally, industrial pollution can cause it to reach levels that threaten public health. The current problem with hexavalent chromium reflects decades of insufficient government regulation of the chemicals used by major industries in the U.S. Every year, more than 80,000 chemicals, many of them suspected carcinogens, are approved for use by industry, and discharged into waterways that also happen to serve as drinking water sources.

The presence of hexavalent chromium in some municipal water is yet another sign that it's time for the U.S. to renew its commitment to providing consumers with safe, affordable tap water. Unfortunately, this requires money, and water utilities across the country lack the funds to meet Environmental Protection Agency (EPA) regulations for drinking water quality, much less more protective ones to fix problems not addressed by the EPA. Inadequate federal funding for local public water systems only exacerbates these problems even more.

Rather than putting the onus on municipalities and taxpayers to clean up the mess left by major industries, the EPA needs to step up and do a better job of thoroughly testing the safety of chemicals before allowing them to be dumped into our water.

Consumers using this recent scare as an excuse to abandon tap water in favor of the bottled kind should think again -- almost half of all bottled water comes from tap water supplies. Moreover, independent testing by the Environmental Working Group found 38 contaminants present in 10 brands of bottled water.

Despite these recent developments that may suggest otherwise, U.S. tap water is among the safest in the world. And unlike bottled water, your local utility tests it hundreds of times a month for toxic chemicals. Tap water is also the most environmentally sustainable and socially equitable way to provide drinking water to the public. But in order to keep it that way, we must protect our source water by tightening regulation of the chemicals that threaten the integrity of this vital public resource.

The Future of Food Riots

Monday, January 10, 2011 by CommonDreams.org
by Gwynne Dyer

If all the food in the world were shared out evenly, there would be enough to go around. That has been true for centuries now: if food was scarce, the problem was that it wasn't in the right place, but there was no global shortage. However, that will not be true much longer.

The food riots began in Algeria more than a week ago, and they are going to spread. During the last global food shortage, in 2008, there was serious rioting in Mexico, Indonesia, and Egypt. We may expect to see that again this time, only bigger and more widespread.

Most people in these countries live in a cash economy, and a large proportion live in cities. They buy their food, they don't grow it. That makes them very vulnerable, because they have to eat almost as much as people in rich countries do, but their incomes are much lower.

The poor, urban multitudes in these countries (including China and India) spend up to half of their entire income on food, compared to only about ten percent in the rich countries. When food prices soar, these people quickly find that they simply lack the money to go on feeding themselves and their children properly - and food prices now are at an all-time high.

"We are entering a danger territory," said Abdolreza Abbassian, chief economist at the Food and Agriculture Organisation, on 5 January. The price of a basket of cereals, oils, dairy, meat and sugar that reflects global consumption patterns has risen steadily for six months, and has just broken through the previous record, set during the last food panic in June, 2008.

"There is still room for prices to go up much higher," Abbassian added, "if for example the dry conditions in Argentina become a drought, and if we start having problems with winter kill in the northern hemisphere for the wheat crops." After the loss of at least a third of the Russian and Ukrainina grain crop in last summer's heat wave and the devastating floods in Australia and Pakistan, there's no margin for error left .

It was Russia and India banning grain exports in order to keep domestic prices down that set the food prices on the international market soaring. Most countries cannot insulate themselves from this global price rise, because they depend on imports for a lot of domestic consumption. But that means that a lot of their population cannot buy enough food for their families, so they go hungry. Then they get angry, and the riots start.

Is this food emergency a result of global warming? Maybe, but all these droughts, heat waves and floods could also just be a run of really bad luck. What is nearly certain is that the warming will continue, and that in the future there will be many more weather disasters due to climate change. Food production is going to take a big hit.

Global food prices are already spiking whenever there are a few local crop failures, because the supply barely meets demand even now. As the big emerging economies grow, Chinese and Indian and Indonesian citizens eat more meat, which places a great strain on grain supplies. Moreover, world population is now passing through seven billion, on its way to nine billion by 2050. We will need a lot more food than we used to.

Some short-term fixes are possible. If the US government ended the subsidies for growing maize (corn) for "bio-fuels", it would return about a quarter of US crop land to food production. If people ate a little less meat, if more African land was brought into production, if more food was eaten and less was thrown away, then maybe we could buy ourselves another fifteen or twenty years before demand really outstripped supply.

On the other hand, about a third of all the irrigated land in the world depends on pumping groundwater up from aquifers that are rapidly depleting. When the flow of irrigation water stops, the yield of that highly productive land will drop hugely. Desertification is spreading in many regions, and a large amount of good agricultural land is simply being paved over each year. We have a serious problem here.

Climate change is going to make the situation immeasurably worse. The modest warming that we have experience so far may not be the main cause of the floods, droughts and violent storms that have hurt this year's crops, but the rise in temperature will continue because we cannot find the political will to stop the greenhouse-gas emissions.

The rule of thumb is that we lose about 10 percent of world food production for every rise of one degree C in average global temperature. So the shortages will grow and the price of food will rise inexorably over the years. The riots will return again and again.

In some places the rioting will turn into revolution. In others, the rioters will become refugees and push up against the borders of countries that don't want to let them in. Or maybe we can get the warming under control before it does too much damage. Hold your breath, squeeze your eyes tight shut, and wish for a miracle.

Unique internet ID for all Americans coming--Big Brother will be watching you and know who you are

(The Obama Administration--to whom many bad bad ideas have already been attached--has come up with another incredibly bad idea and way to violate our rights to anonymity. This is another thing Bush would have loved to do that the fake liberal Obama will do. Hope and change feel just as bad as the despair and angst we've felt since 2000. Obama is the antithesis of everything he "stood" for during his campaign, making those who voted for him feel like suckers. Thanks to Matt S. for the share.--jef)

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Obama administration moves forward with unique internet ID for all Americans, Commerce Department to head system up
By Laura June posted Jan 9th 2011

President Obama has signaled that he will give the United States Commerce Department the authority over a proposed national cybersecurity measure that would involve giving each American a unique online identity. Other candidates mentioned previously to head up the new system have included the NSA and the Department of Homeland Security, but the announcement that the Commerce Department will take the job should please groups that have raised concerns over security agencies doing double duty in police and intelligence work. So anyway, what about this unique ID we'll all be getting? Well, though details are still pretty scant, U.S. Commerce Secretary Gary Locke, speaking at an event at the Stanford Institute, stressed that the new system would not be akin to a national ID card, or a government controlled system, but that it would enhance security and reduce the need for people to memorize dozens of passwords online. Sorry, Locke, sounds like a national ID system to us. Anyway, the Obama administration is currently drafting what it's dubbed the National Strategy for Trusted Identities in Cyberspace, which is expected at the Department of Commerce in a few months. We'll keep you posted if anything terrifying or cool happens.--CBS News

The Very Wealthy Man