Chemical Industry to Nation's Infants & Toddlers: Suck It (Up)

Thursday, November 18, 2010 by NRDC Blog
by Daniel Rosenberg

In the major food safety legislation that the Senate is debating, which will likely pass today or tomorrow, one important provision will probably be missing: a ban on bisphenol A (BPA) in baby bottles or sippy cups.  The provision wasn’t included in the bill, and an amendment to add it before passage wasn’t able to get a vote on the floor of the Senate, due in large part to objections from the chemical  industry – represented in Washington DC by its trade association The American Chemistry Council (formerly known as the Chemical Manufacturers Association).

Give the chemical industry some credit: it has been acting consistently for years, even decades, to oppose any meaningful regulation of chemicals at the federal or state level, spending hundreds of millions of dollars and blocking protection for the public from chemicals that cause cancer, birth defects and learning and developmental disabilities.  And yet, blocking passage, or even a vote, on an amendment to ban bisphenol A in baby bottles and sippy cups still seems like a new low.

Senator Dianne Feinstein has emerged as a strong national leader in the fight for strong public protections from toxic chemicals, especially chemicals to which people are most widely exposed.  She was instrumental in banning three phthalates commonly used as plasticizers in childrens’ toys, and suspending the use of three others pending additional study by the Consumer Product Safety Commission.  That was a fight the chemical industry lost, largely because no Senator was willing to stand on the floor of the U.S. Senate and publicly oppose her efforts.  The chemical industry learned its lesson from that fight, and, in the battle over bisphenol A, the industry was determined to prevent her provision from making it into legislation, or ever allowing it to come up for a vote. According to at least one report, North Carolina Senator Richard Burr has been working with the chemical industry behind the scenes to block the Feinstein provision from being included in the bill.

The food industry, represented by the Grocery Manufacturers Association, has also gone to great lengths to prevent Senator Feinstein from successfully restricting the use of BPA, or fully assessing its potential effects on women and children.  But that is a story for another post.  At the end of the day, the Grocery Manufacturers were willing to go along with legislation that at least banned the use of BPA in baby bottles and sippy cups (where GMA members have less of a direct interest), and that required FDA to complete a safety assessment and determine whether BPA met the safety requirements of the Food Drug and Cosmetic Act by December 2012.

But the chemical industry couldn’t even stomach that.  The ACC – whose members include some of the largest chemical companies in the world such as BASF, Dow, and DuPont and other plastics manufacturers -- has spent millions of dollars to defeat state-led efforts to restrict the use of bisphenol A in infant formula, baby food, baby bottles and sippy cups.  They’ve had a poor return on that investment, though. To date, seven states have adopted some version of restrictions on the use of BPA, along with the City of Chicago.

A little more than a year ago, the ACC, the GMA, and several industry lobbyists and representatives of companies including Coca-Cola and Del Monte met at a private club in Washington DC to plot a strategy for defeating more of those state led-efforts.  Minutes from that meeting ended up in the hands of the Washington Post and the Milwaukee Journal Sentinel which both ran stories about industry’s plans.   These included searching for a pregnant mom to be a spokesperson for BPA, buying the support of scientists, and convincing African-Americans and Hispanics that a ban on BPA in infant formula and baby food would make those products unavailable where they lived.

The industry had one temporary victory in California this year, where it spent millions of dollars to defeat legislation to ban BPA in children’s food products.  The industry (which has continually complained about the “high cost” of complying with the most basic proposals from EPA or Congress to expand the public’s right to know about what products contain toxic chemicals, and which chemicals people should be concerned about) can look forward to spending millions more dollars in California in the near future.  But don’t worry, industry profits remain healthy during these tough economic times. And they’ve shown that they’ll spend whatever it takes on lobbyists, paid scientists, misleading ad campaigns, and, of course, campaign contributions to member of Congress, to ensure that they can block as much reform as possible.

The industry will say: all of the hundreds of peer-reviewed studies by independent scientists not funded by the chemical industry that show strong associations between BPA and breast and prostate cancer, as well as effects on the reproductive system are wrong, mistaken, etc. etc.  My colleague Dr. Sarah Janssen and many others have responded to those bogus charges repeatedly.  But, even if we acknowledge that everything there is to be known about BPA is not yet known, that is hardly an argument for keeping BPA in baby bottles, sippy cups, or any other packaging where it can migrate into our food supply.  BPA is routinely found in more than 90% of us, even though it is quickly excreted from our bodies (we pee it out).  That means we are essentially being exposed to BPA constantly, and the major source of that exposure is our food (including beverages).  BPA crosses the placental wall, which means the developing fetus is being exposed in utero (not only to BPA, but to dozens, and possibly hundreds of other toxic chemicals).

The failure to protect the public from constant exposure to BPA is one part of a much larger problem: our current laws do not protect us from unsafe chemicals, and keep us in the dark about the potential effects of thousands of others, which may be unsafe.  That is why NRDC and our coalition, the Safe Chemicals Healthy Families campaign, is working to reform the Toxic Substances Control Act (TSCA).

The chemical industry has given lip service to supporting TSCA reform and the need to protect children from unsafe chemicals (the trick being that, in the chemical industry’s view, there are no unsafe chemicals). The Feinstein amendment was an attempt to take a tentative baby step toward reform.  But the Chemical Industry snuffed it out.  So, big win for chemical industry lawyers on K Street.  For the children of America and their parents?  Not so much.

World Comparison Shows U.S. Healthcare Lacking

Thursday, November 18, 2010 by Reuters
by Maggie Fox

WASHINGTON - A third of Americans say they have gone without medical care or skipped filling a prescription because of cost, compared to 5 percent in the Netherlands, according to study released on Thursday.

The study is the latest in a series by the non-profit Commonwealth Fund showing that while Americans pay far more per capita for healthcare, they are unhappier with the results and less healthy than people in other rich countries.

The study published in the journal Health Affairs also showed that 20 percent of U.S. adults had major problems paying medical bills, compared with 2 percent in Britain and 9 percent in France, the next costliest country.

"U.S. adults were the most likely to incur high medical expenses, even when insured, and to spend time on insurance paperwork and disputes or to have payments denied," the report reads.

The Commonwealth Fund, which advocates for U.S. healthcare reform, commissioned a Harris Interactive poll of nearly 20,000 people in 11 countries between March and June.

"What we are hearing directly from adults around the world, and what we hear regularly at home, is that there is substantial room for improvement in the U.S. health insurance system," said Commonwealth Fund President Karen Davis.

Healthcare reform was U.S. President Barack Obama's signature policy effort, but not a single Republican voted for the bill that Obama signed into law this year and conservatives in Congress have promised to try to dismantle it.

The new law is meant to address some of the weaknesses in the U.S. system by forcing more Americans to buy health insurance, expanding public insurance and preventing insurers from dropping coverage.

About 60 percent of Americans under 65 get health insurance through an employer -- about 157 million adults. Health insurers include WellPoint, Aetna Inc, Cigna Corp, Humana Inc, UnitedHealth Group Inc, Health Net Inc, Amerigroup Corp and the Blue Cross Blue Shield network.

Roughly 45 million people 65 and older have coverage through the nation's Medicare program for the elderly and disabled.

The system leaves 47 million without any health insurance, and last week the U.S. Centers for Disease Control and Prevention estimated that 59 million Americans had no insurance for at least some of the beginning of 2010.

The 10 other countries in the survey -- Australia, Britain, Canada, France, Germany, the Netherlands, New Zealand, Norway, Sweden and Switzerland -- all provide a mix of public and private insurance.

Adults in Britain, Switzerland, New Zealand and the Netherlands were the most likely to be able to get to a doctor the same day or next day when they needed to, the survey found.

More than 90 percent of Swiss adults said they could see a doctor that fast, compared with 57 percent of adults in Sweden and the United States, and fewer than half in Canada and Norway.

Only 70 percent of adults in the United States or Norway said they were confident they would get the most effective treatment if ill, compared with 90 percent of Britons and 89 percent of the Swiss.

"The United States is the only country in which one-fifth of adults reported serious problems paying health care bills," the study adds.

The Physical and Emotional Costs of Long-Term Unemployment

Thursday, November 18, 2010 by ColorLines
by Yvonne Yen Liu

CNN and the New York Times report new research that shows that long-term unemployment doesn’t just impact the jobless in the short-term, but has deep implications for the lifelong health and well-being of an individual as well as their children and families. One study by a sociologist at Albany, Kate W. Strully, found that people who lose their jobs are 83 percent more likely to develop stress-induced conditions, such as diabetes, arthritis, or depression. 

Another paper by an economist at Columbia University, Till von Wachter, looked at mortality and income records of workers in Pennsylvania during the recession of the early 1980s. Wachter found that death rates increased astronomically for the unemployed in the year they lose their jobs, up to 100 percent. Mortality rates remained significantly higher for those that lose their jobs than for comparable workers who didn’t. In fact, the life expectancy of the unemployed is cut by a year to a year and a half.

The NY Times shared also stories of white steel workers who had heart attacks after being laid off from their jobs because the steel mill closed. We know that workers of color feel these health impacts doubly, on top of the existing trauma of structural racism.

Here’s what all of this adds up to: We need the White House and Congress to put aside partisan bickering and craft a large-scale job creation program that will put the millions of unemployed to work. The crisis has gone on long enough and spread wide enough that the costs of not doing so spread way past economics.

In the short-term, the lame-duck Congress will face a decision over whether to extend unemployment benefits. Typically, benefits last 26 weeks. The maximum time period was extended this past July, but will expire on Nov. 30 unless Congress passes legislation to continue relief. Yesterday, several advocacy groups sponsored a national call-in day to Congress to urge senators to continue unemployment benefits.

Unemployment insurance acts as a buffer, reducing the shock and strain on the jobless during economic hard times. It also stimulates spending in the economy, which can create jobs. The long-term unemployed have to spend their benefits immediately because they don’t have income or savings. That spending on food, rent and other basic needs translates into an infusion of cash into the economy and the creation of jobs. The Economic Policy Institute calculated that extending the unemployment insurance generated 1.7 million jobs in the first quarter of 2010. Were Congress to continue benefits through 2011, EPI estimates that over 700,000 jobs will be created.

Our people are hurting now, not only economically, but also in physical and emotional well-being. Extending benefits for the unemployed is the least our government can due for us, in our time of great need.

Legal Pros Say No to Citizens United

Experts call for Constitutional amendment to take back democracy from corporations

by Jeffrey D. Clements and Ben T. Clements
Thursday, November 18, 2010 by YES! Magazine

In the wake of the Supreme Court's decision in Citizens United v. FEC, corporate money has poured into the 2010 elections in unprecedented amounts. Now, a bipartisan group of leading law professors, former state attorneys general, former prosecutors, and prominent attorneys from across the country has signed a letter calling on Congress to consider a Constitutional amendment to overrule Citizens United and return elections and government to the people. We joined that call because the notion of "corporate rights" expressed in Citizens United is antithetical to Constitutional principles of free speech, democracy, and self-government.

In that case, the Court ruled that the First Amendment prohibits restrictions on so-called "independent expenditures" by corporations to attempt to defeat or elect candidates. The Court equated corporations with people for purposes of free speech rights and struck down key provisions of the federal Bipartisan Campaign Reform Act.

The creation of absolute corporate "speech" rights to spend money on elections is contrary to Constitutional principles and to the American vision of self-government by free people. That vision cannot coexist with elections dominated by hundreds of millions of dollars of corporate electioneering money.

Caution about corporate interference in politics goes back to our earliest days as a nation. James Madison, for example, warned that corporations may be "necessary evils," but they must have proper "limitations and guards." That's why the federal ban on corporate political contributions enacted by Theodore Roosevelt and Congress in 1907 was never, until Citizens United, viewed as a restriction on anyone's free speech.

We know that amending the Constitution must be reserved for what Madison called "great and extraordinary occasions."

Americans have many times used the amendment process to remove obstacles to people's participation in self-government on equal terms. The 13th Amendment ended slavery; the 14th guaranteed liberty, due process, and equal protection to all; and the 15th guaranteed the right to vote could not be abridged on account of race. With the 17th Amendment, the people claimed the right to elect U.S. Senators. The 19th Amendment guaranteed the right of women to vote-directly overruling the Supreme Court. In fact, in the 20th Century alone, we amended the Constitution 12 times.

Constitutional amendments require a wide consensus across all party lines. Citizens United has created that consensus. Most Americans know that corporations are not people and that money is not speech.

Indeed, according to multiple polls, more than two-thirds of the American people, regardless of political party, reject the Citizens United decision and do not accept that we the people cannot decide for ourselves the appropriate level of regulation of the use of corporate money to determine our election results.

We did not lightly conclude that the long, hard work of a Constitutional amendment campaign must begin. But we cannot ignore the state of our nation and the increasing danger that our government may no longer be of, for, and by the people. We look forward to exploring with Congress, our states, and the American people the path back to a spirited and healthy democracy.

Let's Build the New Economy

Friday, November 19, 2010 by CommonDreams.org
by Joe Brewer

We need to build a new economy, one that promotes widespread prosperity while protecting us against ecological disaster.  The problem is that the current economy has been structured explicitly to extract wealth from the global commons and accumulate it in the coffers of an extremely powerful elite.  And it is standing in our way.

I say let the U.S. economy collapse.  It’s not serving us anyway.  Now before you go off and think I’m just a heretic who hates this country, please hear me out.

The current economy is designed to:

• Encourage widespread home ownership, which straps people to a lifetime of mortgage debt;
• Mandate that health care only be provided through employers, which enslaves people to meaningless jobs they don’t like;
• Grow perpetually, which means that natural resources must be depleted to keep the gears turning;
• Accumulate wealth in the hands of those who control capital, which drives a wedge between the haves and the have-nots;
• Drive the creation of sweat shops all over the world that enslave billions in a cycle of perpetual poverty;
• Allow corporations to co-opt our democracy, by granting them the rights of legal personhood and defining money as speech;
• Ultimately destroy the foundations of human well-being, thus spiraling deregulated markets out of control.

As a result, we are seeing massive growth of public debt while a small portion of the population becomes more wealthy than the monarchs of past ages.  These billionaires then build incredibly sophisticated propaganda machines to convince everyday citizens to support their exploitative system.

I would be perfectly happy to let this economy collapse if a better one were to replace it.  Luckily, the collapse is about to be accelerated.  We’re about to see the federal political system become even more dysfunctional.  And the life supports for our economy — the vital infrastructure funded by public dollars — is about to be cut even further to extract wealth for the super rich.  Tea Party supporters have ensured that the next few years will further corrode the existing economy through the attack of a thousand cuts.

We can take comfort in the knowledge that the global economy of the late 20th Century is in the process of collapsing.  It wasn’t serving us anyway.

Now is the time for social entrepreneurs to mobilize and begin the creative process of building the foundational institutions of the 21st Century economy.  Look around and you will see that this effort is already underway.  Micro-credit lending institutions are revolutionizing the world of finance (see Kiva and Grameen Bank).  Social media platforms are replacing the elite communication systems set up to broadcast information from a central source to the masses.  Legal hackers are creating benefit corporations that merge the social missions of non-profits with the economic power of publicly traded corporations.  And urban designers are creating cityscapes that mimic natural ecosystems.

So let’s begin the work of building 21st Century political and economic systems.  The need is clear and the time is right.  Many bottlenecks to progress are about to be removed de facto as state governments grapple with bankruptcy and corporations expand their stranglehold on our judicial and legislative systems.  The weakening of our economic foundations will bring with it a loosening of control that these powerhouses have on economic development.

Rough times lie ahead, no doubt about it.  But we can take heart in the entrepreneurial spirit of the American people and the considerable economic power of our major cities.  A truism that we must all take to heart is that, while the 20th Century was dominated by nations, the 21st Century will be shaped primarily by cities.  If you don’t believe me, look at the rapid urbanization of China and India and ask yourself how many of the remaining resources will be sucked up by the unprecedented growth of buildings, regional transit systems, and commerce in the developing world.

Many Americans are going to be caught off guard when the carpet is pulled out from under their feet.  Others will be relieved that we can finally begin to catch up with the rest of the world, presuming of course that our own cities aren’t entirely decimated by the hording of wealth by short-sighted elites.  We currently house most of the world’s best research labs and continue to attract global intellectual talent to our shores.  (Of course, this may change if the xenophobic tenor of our immigration debate doesn’t catch up with the times.)  And we have several awe-inspiring regional economies like the San Francisco Bay Area, Puget Sound in the Pacific Northwest, and a number of hubs in New England.

So all you social innovators out there, now is the time to heed the call.  Focus your efforts on the new business models, disruptive technologies, collaborative finance systems, and politic organizing platforms.  We’re going to need you.

The time to build the new economy is upon us.

Common Myths about the War on Terrorism

Friday, November 19, 2010 by CommonDreams.org
by Reese Erlich

I'm finishing up a 25-city book tour that took me from New York and Chicago to Elizabethtown, PA, and Spearfish, SD. I met with college students, farmers and laid-off workers. Most people in the US now oppose the wars in Afghanistan and Iraq, but I found a lot of confusion about the War on Terrorism.

Here are four of the more commonly asked questions:

1. Isn't it true that while not all Muslims are terrorists, all terrorists are Muslims?

Well, just asking the question reveals a lot about how those in power have manipulated our concept of terrorism.

To begin, I point out that plenty of non-Muslims have carried out terrorist acts. Here's a partial list.

• Timothy McVeigh was convicted of detonating a truck bomb in front of the Oklahoma City federal building in 1995, which resulted in 168 deaths. He was Catholic.
• In 1994 Baruch Goldstein, a Jewish-American Israeli settler in the West Bank city of Hebron opened fire on Muslim worshippers, killing 29 and wounding 150. He died at the scene, and his grave later became a pilgrimage site for extremists in Israel.
• Murderers of abortion doctors in the US frequently carry out their crimes in the name of evangelical Christianity.
• In 2010, in a protest against federal government policies, Joseph Stack flew a plane into an Austin building housing IRS offices. He came from a Christian background and ranted against all religion.

I understand if you didn't think of those examples right away. We've been conditioned to think of terrorists as foreigners, or people trained by foreigners, preferably dark skinned people with a grudge against the West. But a white guy with a bomb trying to kill civilians for political purposes is still a terrorist.

Targeting civilians with political violence is terrorism, whether carried out by individuals, groups or governments. But the US government and major media have so distorted the word that virtually anyone who uses violence to oppose US policy is branded a terrorist. Conversely, anyone using violence against civilians to support US policy is a freedom fighter.

2. Yeah, but didn't Arabs and Muslims initiate the use of terrorism?

Actually, no.

Zionists fighting in Palestine prior to the formation of Israel pioneered many modern day terrorist tactics. In 1947 an extremist Zionist group called Lechi, also known as the Stern Gang, was the first to use letter bombs. It mailed them to British Cabinet members.

The Stern Gang assassinated major British diplomats and the chief UN mediator trying to negotiate a two-state solution in 1948 Palestine. The Irgun, another Zionist extremist group, planted bombs in Arab East Jerusalem, seeking to kill civilians and drive Palestinians out. Arab insurgent groups also planted bombs intended to kill civilians and used other terror tactics against Jews.

In 1954 Israel became the first country to hijack an airplane for political purposes. It seized a Syrian civilian plane in a failed effort to trade hostages for Mossad intelligence agents captured by the Syrians.

Nor did Muslims originate suicide bombings. That dubious honor belongs to the Tamil Tigers of Sri Lanka, who were Hindus.

3. Others may engage in terrorism, but isn't Arab and Muslim terrorism a serious threat to US national security?

Some extremists acting in the name of Islam do pose a threat to American civilians. The perpetrators of such crimes should be arrested, given fair trials and, if found guilty, severely punished. Muslims and everyone else around the world would cooperate with such police action. After all, extremist groups have killed far more Muslims than Christians or Jews.

But isn't that rather naïve to think police action can dismantle al Qaeda? After all, didn't the US have to invade Afghanistan to put al Qaeda on the run?

It wasn't necessary to invade and permanently occupy Afghanistan to rout al Qaeda. The few hundred members of al Qaeda living in Afghanistan fled the country and set up shop in Pakistan. Today, autonomous cells operate in Yemen and other countries. And, after nine years on the most wanted list, the US has still not managed to capture Osama bin Laden or other top leaders.

Fighting extremist groups such as al Qaeda requires both political and armed action. Undercut their base politically and isolate them among their followers. Turncoats and local officials will help capture the leaders.

But US military actions have had the opposite effect. The US occupation of Iraq and Afghanistan, and the covert war in Pakistan, help recruit angry young men to the extremist cause.

Instead of narrowing the target to the small number of extremist groups, US leaders intentionally expand the enemies list. They lump together al Qaeda with Hamas in Palestine and Hezbollah in Lebanon. We are told that they are all part of a worldwide terrorist network.

In fact, groups such as Hezbollah and Hamas have significant bases of support, and have won free and fair elections, while also maintaining armed wings. They consider themselves national liberation movements opposing foreign occupiers.

If I lived in Lebanon or Palestine, I would never vote for such groups. They represent a conservative, religious trend that opposes real freedom in their countries. For the same reasons, I would never vote for Israel's religious parties. But just as Israel's religious extremists are part of that country's political reality, so Hamas and Hezbollah must be treated a serious political players - not marginalized as "terrorists."

4. So why is the US fighting in so many countries?

Under the guise of combating terrorism, the US has expanded its fleets of aircraft carriers, battle ships, and fighter-bombers - armaments particularly ill-suited to fight terrorist cells. But they do allow the US empire to forcibly expand around the globe, helping guarantee profits for US corporations. Oil pipeline and drilling companies got lucrative contracts in Iraq; US oil companies are preparing for a bonanza if Iraq finally privatizes its oil industry.

Over the past nine years, the US has built over a dozen new military bases throughout the Middle East and Asia. The US has over 750 military bases at home and around the world.

But the empire is in decline. The current wars have cost over a trillion dollars, and the meter is still running. A significant part of the current economic crisis, with 9.5% unemployment, flows from never-ending spending on war. A majority of Americans have come to oppose the wars in Iraq and Afghanistan. People in the Middle East and in the US will eventually force a withdrawal of US troops and an end to the wars.

The US will never win the War on Terrorism. The term will simply fade into the history books, along with the empire itself.

Dangerous Drugs Big Pharma Shoves Down Our Throats

In the pharmaceutical industry’s rush to get drugs to market, safety usually comes last. And the public suffers. 

By Martha Rosenberg, AlterNet
November 19, 2010

In the pharmaceutical industry’s rush to get drugs to market, safety usually comes last. Long studies to truly assess a drug's risks just delay profits after all -- and if problems do emerge after medication hits the market, settlements are usually less than profits. Remember, Vioxx still made money.

The following drugs are so plagued with safety problems, it is a wonder they’re on the market at all. It's a testament to Big Pharma's greed and our poor regulatory processes that they are.

-- Lipitor and Crestor
Why is Lipitor the bestselling drug in the world? Because every adult with high LDL or fear of high LDL is on it. (And also 2.8 million children, says Consumer Reports.) No one is going to say statins don't prevent heart attack in high-risk patients (though diet and exercise have worked in high-risk groups too). But doctors will say statins are so over-prescribed that more patients get their side effects -- weakness, dizziness, pain and arthritis -- than heart attack prevention. Worse, they think it's old age!

"My older patients literally do without food so that they can buy these medicines that make them sicker, feel bad, and do nothing to improve life," says an ophthalmologist web poster from Tennessee. "There is no scientific basis for treating older folks with $300+/month meds that have serious side-effects and largely unknown multiple drug interactions." What kinds of side effects? All statins can cause muscle breakdown (called rhabdomyolysis) but combining them with antibiotics, protease inhibitors drugs and anti-fungals increases your risks. In fact, Crestor is so highly linked to rhabdomyolysis it is double dissed: Public Citizen calls it a Do Not Use and the FDA's David Graham named it one of the five most dangerous drugs before Congress.


-- Yaz and Yasmin

It sounded too good to be true and it was. Birth control pills that also cleared up acne, treated severe PMS (Premenstrual Dysphoric Disorder or PMDD) and avoided the water retention of traditional birth control pills.

But soon after Bayer launched Yaz in 2006 as going "beyond birth control," 18-year-olds were coming down with blood clots, gall bladder disease, heart attacks and even strokes. Fifteen-year-old Katie Ketner had her gallbladder removed. Susan Gallenos had a stroke and part of her skull removed. College student Michelle Pfleger, 18, collapsed and died of a pulmonary thromboemboli from taking Yaz, says her mother Joan Cummins.

While TV ads for Yaz in 2008 were so misleading that FDA ordered Bayer to run correction ads, Yaz sales are still brisk. In fact, financial analysts attribute the third quarter slump in the Yaz "franchise" of 28.1 percent to the appearance of a Yaz generic, not to the thousands of women who have been harmed.

Why is Yaz sometimes deadly? It includes a drug that was never before marketed in the U.S. -- drospirenone -- and apparently causes elevated potassium, heart problems, and a change in acid balance of the blood. Who knew? But not only is Bayer still marketing it, women do not receive "test subject" compensation for using it either.

-- Lyrica, Topomax and Lamictal

Why would Americans take an epilepsy seizure drug for pain? The same reason they'll take an antipsychotic for the blues and an antidepressant for knee pain: good consumer marketing. In August FDA ordered a warning for aseptic meningitis, or brain inflammation, on Lamictal -- but it is still the darling of military and civilian doctors for unapproved pain and migraine. Lamictal also has the distinction of looting $51 million from Medicaid last year despite a generic existing.

All seizure drugs increase the risk of suicidal thoughts and behaviors according to their mandated labels. An April article in JAMA found seizure drugs linked to 26 suicides, 801 attempted suicides, and 41 violent deaths in just five years.

All three drugs can make you lose your memory and your hair, say posters on the drug rating site askapatient.com. Topamax is referred to as "Stupamax" in the military -- though evidently not enough to ask, "Why am I taking this drug again?"

-- Humira, Prolia and TNF Blockers

If you think pharma is producing a lot of expensive, dangerous injectables lately, you're right. Yesterday's blockbuster pills have been supplanted with vaccines and biologics that are more lucrative and safer...from generic competition, that is. The problem is, not only are biologics like Humira and Prolia creepy and dangerous -- they're made from genetically engineered hamster cells and suppress the actual immune system -- the diseases they treat are "sold" to healthy people.

Recently, thousands of college students in Chicago found inserts in their campus newspapers hawking Humira for Crohn's disease, rheumatoid arthritis and psoriatic arthritis. ("Hate psoriasis? Love clearer skin," says an ad on the Humira Web site featuring a pretty woman.) And earlier this year Prolia was approved by the FDA for postmenopausal osteoporosis with a high risk of fracture. Do healthy people really want to suppress their body's tumor necrosis factor (TNF) and invite tuberculosis, serious, possibly lethal infections, melanoma, lymphoma and "unusual cancers in children and teenagers" as the Humira label warns? Nor is it clear these drugs work. The Humira label warns against developing "new or worsening" psoriasis -- a condition it is supposed to treat.


-- Chantix
How unsafe is the antismoking drug Chantix? After 397 FDA cases of possible psychosis, 227 domestic reports of suicidal acts, thoughts or behaviors and 28 suicides, the government banned pilots and air traffic controllers and interstate truck and bus drivers from taking Chantix in 2008. Four months later, some military pharmacies banned the drug, which reduces both cravings and smoking pleasure. In addition to Chantix' neuropsychiatric effects (immortalized by New Bohemians musician Carter Albrecht, who was shot to death in 2007 in Texas by a neighbor after acting aggressively), Chantix is linked to angioedema, serious skin reactions, visual impairment, accidental injury, dizziness, muscle spasms, seizures and loss of consciousness. In defending an increasingly indefensible drug, Janet Woodcock, director of the FDA Center for Drug Evaluation said last year, "Smoking is the leading cause of preventable disease, disability, and death in the United States and we know these products are effective aids in helping people quit." True enough -- but if you smoke cigarettes you can still drive an interstate truck.

-- Ambien
Sleeping pills like Ambien, Lunesta, Sonata and Rozerem only decrease get-to-sleep time by 18 minutes according to the National Institutes of Health (NIH).

But Ambien has additional cachet compared to its soporific brethren: it is the drug Tiger Woods reportedly used when cavorting with his consorts; and former U.S. Rep. Patrick Kennedy was taking it when he crashed his Ford Mustang while driving to Capitol Hill in the middle of the night to "vote" in 2006.

In fact Ambien's legendary somnambulism side effects -- people walk, drive, make phone calls and even have sex while sleeping -- has increased traffic accidents say law enforcement officials, with some drivers not even recognizing arresting police. Thanks to bad Ambien press, Sanofi-Aventis has had to run ads telling the public to get in bed and stay there if you are going to take Ambien. (Or you'll break out in handcuffs, as the joke goes.) Ambien has also increased the national weight problem as dieters wake up amid mountains of pizza, Krispy Kreme and Häagen-Dazs cartons consumed by their evil twins.

-- Tamoxifen

Is it a coincidence that Tamoxifen maker AstraZenaca founded Breast Cancer Awareness Month and makes carcinogenic agrochemicals that cause breast cancer? Both the original safety studies of Tamoxifen, which causes cancer, birth defects and is a chemical cousin of organochlorine pesticides, and its original marketing were riddled with scientific error. In fact, FDA objected to AstraZeneca's marketing claim of breast cancer prevention and the casting of endometrial cancer as an "uncommon" event 10 years ago.

Yet today pharma-linked doctors still tell women to take Tamoxifen to prevent breast cancer even though an American Journal of Medicine study found the average life expectancy increase is nine days (and Public Citizen says for every case of breast cancer Tamoxifen prevents there is a life-threatening case of blood clots, stroke or endometrial cancer). A Gynecologic and Obstetric Investigation study shows an example of Tamoxifen's downside: 57.2 percent of women on continuous Tamoxifen developed atrophy of the lining of the uterus, 35.7 coexisting hyperphasia and 8.1 percent uterine polyps. We won't even talk about eye and memory problems -- or the Tamoxifen cousin, Evista, that pharma is also pushing which has a "death from stroke" warning on its label.

-- Boniva
Why is the bisphosphonate bone drug Boniva available in a convenient, once-monthly formulation? Could patients balk at the fact that after you take it you have to avoid lying down for at least 60 minutes to "help decrease the risk of problems in the esophagus and stomach," wait at least 60 minutes before eating or drinking anything except water, never take it with mineral water, sparkling water, coffee, tea, milk, juice or other oral medicine, including calcium, antacids, or vitamins, and of course, "do not chew or suck"? Nor should you take Boniva, say the warnings, "if you have difficult or painful swallowing, chest pain or continuing or severe heartburn, have low blood calcium or severe kidney disease or if severe bone, joint and/or muscle pain."

Bone drugs like Boniva, Fosamax and Actonel are a good example of FDA approving once-unapprovable drugs by transferring risk onto the public's shoulders with "we warned you" labels. The warnings are supposed to make people make their own safety decisions. Except that people just think FDA wouldn't have approved it if it weren't safe.


-- Prempro and Premarin
You'd think Pfizer's hormone drugs Prempro and the related Premarin and Provera would be history in light of their perks: 26 percent increase in breast cancer, 41 percent increase in strokes, 29 percent increase in heart attacks, 22 percent increase in cardiovascular disease, double the rates of blood clots and links to deafness, urinary incontinence, cataracts, gout, joint degeneration, asthma, lupus, scleroderma, dementia, Alzheimer's disease and lung, ovarian, breast, endometrial, gall bladder and melanoma cancers -- pant pant. But you'd be wrong. Even as we speak, Pfizer-linked researchers are testing the cognitive and cardiovascular "benefits" of hormone therapy, in some cases with our tax dollars, at major universities. Even though the cancer rate in the U.S. and Canada fell when women quit hormone therapy in 2002 (as did the U.S. heart attack rate in women), pharma is rolling out HT "Light" for women who suffer from the "ism" of incredibly short memory.

The Bizarre Tale of Graft and Sleazy Political Opportunism That Brought Us the 'Porno Scanners'

How we got to the point of full body scans, the massive personal intrusion that represents, and the tens of millions spent for machines that irradiate us. 

By Michael Collins, Smirking Chimp
November 18, 201

How did we get to the point of full body scans at airports, the massive personal intrusion that represents, and the tens of millions spent for machines that irradiate us as a consequence of merely flying from here to there?

The proximate cause is the attempted bombing of a December 25, 2009 Northwest airlines flight. Umar Farouk Abdulmutallab, an engineering student, attempted to mix, then detonate a bomb as Northwest Flight 253 from Amsterdam made its descent to Detroit's Metropolitan Airport. Mr. Abdulmutallab somehow got on the flight with the chemicals undetected, hidden in his underwear. (Image)

There was furor followed by calls for tighter airport security. Specifically, Michael Chertoff, former Bush Homeland Security chief, claimed full body scanners were the solution. One thing led to another and here we are today. Full body scanners are in 68 airports and planned for 1,000 across the United States by the end of 2011. Those who refuse the full body scans will be subject to "pat-downs, which include searches of passengers' genital areas."

The Missing Link

Right after the Christmas 2009 bombing attempt, two United States citizens, frequent world travelers, spoke up about what they'd both witnessed prior to the flight departing from Amsterdam's Schiphol International Airport. Kurt Haskell and his wife Lori, attorneys from Taylor, Michigan, were sitting near the ticket counter waiting to board Flight 253. They saw two men approached the counter and speak with the agent on duty. One of the men was later identified as Umar Farouk Abdulmutallab, the Nigerian who would later haplessly try to blow up the Northwest flight. The other was a well dressed man in his 50s (the sharp dressed man) who they took to be an Indian national:

"While Mutallab was poorly dressed, his friend was dressed in an expensive suit," Haskell said. He says the suited man asked ticket agents whether Mutallab could board without a passport. "The guy said, 'He's from Sudan and we do this all the time.'"

Mutallab is Nigerian. Haskell believes the man may have been trying to garner sympathy for Mutallab's lack of documents by portraying him as a Sudanese refugee.

The ticket agent referred Mutallab and his companion to her manager down the hall, and Haskell didn't see Mutallab again until after he allegedly tried to detonate an explosive on the plane.

The Haskell's told their story to U.S. agents investigating the bombing attempt while they and other passengers were held at the Detroit airport. Shortly after being released from the airport, Kurt Haskell posted a comment on a MILive.com news thread. This was the first of a number of media encounters where the story was told consistently.

A summary article in Wikipedia provides the narrative of the official response to the Haskell's story. "The Dutch counter terror agency" reviewed 200 hours of airport security tapes and announced their conclusion that Abdulmutallab had no "accomplices," effectively questioning the accuracy of the Haskells' report. Security officials claimed  the Haskells' report by claiming that the video tape at Schiphol showed no one assisting Abdulmutallab at the ticket counter or anywhere else. The Haskells responded by saying, Show us the tape. At that point, "Federal agents" spoke to ABC's Brian Ross and said, Well, maybe there was a sharp dressed man and here's what he did.

This rejoinder by "Federal agents" is an endorsement of the reasonableness of the account by Kurt and Lori Haskell and, by implication, an admission that their account is correct.

Would Scanners Have Stopped Abdulmutallab?

We know that federal law enforcement quietly allowed the Haskell's story to stand through the statement to Brian Ross. Since key elements of the story have not been formally investigated, we don't know if Abdulmutallab went through normal check-in or if, as witnessed and indicated, he somehow bypassed normal security requirements. We don't know who the sharp dressed man is. We don't know the full extent of the system breakdown that allowed all of this to happen.
We do know that the bomber's father, Umaru Mutellab, one Africa's wealthiest individuals, told U.S. intelligence authorities that his son was a terrorist a month before the bombing. We also know that Abdulmutallab's name was placed in a terrorism database a month before the Christmas flight. However, his name was not transferred from that database to a watch list of 14,000 essentially nominated for the no-fly database, nor was the name transferred to the 4,000 member official no-fly list.

In the furor over the event, a clear voice emerged with a solution to future problems like that presented by the underwear bomber. Michael Chertoff, long time Bush national security official offered these unqualified assertions on December 27 in the Washington Post and December 28 in the New York Times:

Washington Post, Dec 27: "This plot is an example of something we've known could exist in theory, and in order to be able to detect it, you've got to find some way of detecting things in parts of the body that aren't easy to get at," Chertoff said. "It's either pat-downs or imaging, or otherwise hoping that bad guys haven't figured it out, and I guess bad guys have figured it out." 

New York Times, Dec. 28, 2009: "In recent days, Kip Hawley, the former T.S.A. director, and Michael Chertoff, the former homeland security secretary, have called for the rapid installation of a new generation of whole-body scanners that can look underneath clothing to search for hidden weapons or explosives, which officials consider the single most significant aviation threat today..."

From that point forward, the focus on preventing future terror threats to air travel focused on full body scanners. On January 15, 2010, the New York Times appended the December 28, 2009 article with this statement:

"Articles on Dec. 28, 29 and 30, about the apparent bombing attempt on a flight to Detroit, discussed the use of full-body scanners for airport security. They cited Michael Chertoff, the former secretary of homeland security, as supporting wider use of the scanners. Mr. Chertoff has confirmed in several recent interviews that a manufacturer of the devices is a client of his consulting company. That connection should have been noted in the articles."

Chertoff was caught red handed shilling for full body scanners in behalf of a company that was a client of Chertoff's consulting company. He was busted in public by the New York Times editor.
What was the outcome? Chertoff's original, self-interested assertion prevailed. We have full body scans headed for 1,000 airports and, for those who don't want the radiation, the national security grope, invasive searches of the passenger's genital area.

Never mind the first hand eye witness accounts by Kurt and Lori Haskell. Never mind the report by one of the most prominent public figures in Nigeria, the bombers father, that his son was a terrorist and the lack of decisive action on that tip off. Never mind the never released 200 hours of Dutch security footage that could have proven without a doubt the existence of a facilitator, the sharp dressed man who accompanies the bomber.

All of this reveals a systemic defect in anti-terrorism activities, one that, if corrected, could have more efficiently and effectively prevented future terror threats everywhere by logical changes in policies and practices. Instead of decisive action on this clearly documented problem, we now have full body scanners proposed by a Bush era security official with a clear conflict of interest.

Perpetual 9/11

The underwear bomber incident is, in some ways, 9/11 writ small. A credibly identified terrorist is allowed to board U.S. commercial airliner with little scrutiny. There is a tragic outcome. Clear breakdowns in security are exposed, breakdowns that make no real sense to citizens -- failure to put Abdulmutallab on the no-fly list, for example. Congress and others fail to truly examine any of this, while the public is whipped into a fury. Instead of a real solution, a serious, unflinching investigation into who was responsible and why crazy policies are in place that appear to coddle identified threats, we end up with a solution that makes little, if any sense -- full body scanners.

Full body scanners share a common trait with the misdirected solutions to avoid a future 9/11 -- the Patriot Act, illegal wiretapping, suspension of habeas corpus, torture, etc. The scanners represent a major intrusion into our lives, a violation of our rights, a likely health hazard, and a major diversion from the real issue at hand -- incompetence and/or deception in the handling of identified threats to the nation, individuals who somehow bypass the very security protections put in place to stop their attacks.

Replacing Our Failed Economy Is Long Overdue and We Have the Power to Change It

An excerpt from David Korten's Agenda for a New Economy, on what it's going to take to repair our society. 

By David Korten, Berrett-Koehler Publishers
November 19, 2010

The following is an excerpt from the introduction of the 2nd edition of David Korten's Agenda for a New Economy (Berrett-Koehler, 2010). 

I wrote the first edition of Agenda for a New Economy in late 2008 when Wall Street was in the throes of collapse. The phantom wealth machine had been exposed and its devastating effects on the real economy were apparent everywhere.

The book was published just as a new president and new Congress were taking power, and I had hopes they would begin to rein in the Wall Street financial institutions that were causing such pain and set us on the path to a much more sensible economy. I included a chapter with the speech I wanted our youthful, idealistic, articulate new president to give -- one that would recognize the transformation needed in our money system, our economic institutions and the rules that determine their behavior.

I knew the speech was a fantasy. Mostly it was designed to help readers see as clearly as possible the ideas that must redirect our policy making. But in my heart I guess I still hoped that perhaps the new president would in fact put forward some of the ideas in a speech of his own and we would begin the journey to an economy that treats people fairly and is in line with the limits of the planet.

In the 18 months since the first edition came out, we have seen with increasing clarity the extent of Wall Street's hold on Washington. I have abandoned my brief flirtation with the fantasy that Obama might be the exception and that contrary to what I have believed and taught for more than 20 years change might come from the top.

If change comes, the leadership will come from below through citizen action that originates from outside of the institutions that are failing us on so many fronts. Change from below can succeed only when a large number of people have a shared understanding of the roots of the problem and share a vision of the path to its resolution.

As a society, we cannot create a future that we cannot see in our collective mind. One of the most important tasks of the moment is to define a vision of the life-serving New Economy it is ours to create and to build popular commitment to its realization. The first Agenda for a New Economy was a start.

I have since had conversations with a great many intelligent and thoughtful colleagues who have further deepened my own understanding of the issues and options. I've written this second edition to sharpen the framing of the problem and take the vision to the next level as one input to an essential national conversation.

A National Conversation

The Wall Street meltdown in 2008 and the failure of the subsequent bailout effort has in some way touched the life of nearly everyone and is currently at the center of public awareness and concern. People want to understand what went wrong and how it can be set right. It is a propitious opportunity to engage a long-overdue national conversation around some basic yet rarely asked questions.

Most public discussion of the financial crisis has focused on finger-pointing. Who engaged in criminal activity? Who was responsible for falsifying securities ratings? Who was responsible for rolling back essential regulations? Which regulators were asleep at the switch and why? Are Wall Street Bankers over paid?

A few observers -- including Dean Baker (Plunder and Blunder), Kevin Phillips (Bad Money), Gary Weiss (Born to Steal: When the Mafia Hit Wall Street and Wall Street Versus America), Charles Morris (The Trillion Dollar Meltdown), and William Black (The Best Way to Rob a Bank Is to Own One) -- provided extensive documentation of the corruption of Wall Street's most powerful institutions even before the September 2008 financial crash that brought down the global economy. Since the crash there has been an outpouring of such books and articles, including Martin Lowy, Debt Spiral: How Credit Failed Capitalism, RP Bottle, The Trouble with Markets: Saving Capitalism from Itself, Janine R. Wedel, Shadow Elite, and Barry Lynn, Cornered: The New Monopoly Capitalism and the Economics of Destruction. The corruption of Wall Street is beyond dispute and it is now difficult to find anyone not on the Wall Street payroll who publicly denies the need for stronger rules and closer oversight.

Most calls for strengthening regulations and oversight are aimed at keeping reckless bankers and financiers from repeating the crash. While that seems quite a good idea, more fundamental questions are rarely raised.

For example:

• Why should society allow such concentration of power in institutions that benefit only the already rich and powerful while placing the well-being of the larger society at grave risk?
• Do Wall Street institutions do anything so vital to the national interest as to justify opening the national purse strings to shower them with trillions of dollars to save them from the consequences of their own excess?
• Is the whole Wall Street edifice is built on an illusion that has no substance yet carries deadly economic, social, and environmental consequences for the larger society?
• What essential services would a properly structured financial services sector provide in a healthy well-functioning economy and how might that sector best be organized to fulfill those needs?
• What would be the lead indicators that our economies are healthy and well-functioning?

I believe that honest, accurate answers to these questions support the conclusion that rather than repair and restrain the institutions responsible for the crash, the need is to replace them with a system of institutions appropriate to the needs and realities of the 21st century.

Because my rather explicit call to shut down Wall Street, I want to clearly distinguish my position from that of those on the far right who said the too big to fail Wall Street banks should been left to collapse as a self-corrective act of market discipline. As appealing as that option might have been for those of us who are justly outraged by their behavior, because of the interconnections between Wall Street institutions that would have instantly shut down most all of Wall Street and perhaps the rest of the global financial system almost instantly.

The problem is that Wall Street controls the creation and flow of the money on which we depend for meeting most all our material needs. If it suddenly shut down, whether by government action or lack thereof, the credit system would shut down and the money in our bank accounts would disappear. Apart from such exchange as might be supported by the walking around money in our pockets and purses, economic activity would halt, hospitals and government offices would close, and we would have no access to most essentials of daily life, including food and water.

This, of course, is why an otherwise cash strapped and grid locked Washington political establishment and a Congress that can barely reach agreement on the color of the towels in Congressional bathrooms₁ responded instantly with a massive bailout when it appeared that Wall Street's largest banks were on the verge of collapse.

Wall Street must be dismantled slowly and only as alternative institutions are in place to fulfill its necessary and useful functions.

The Story of the First Edition

I wrote Agenda for a New Economy to open a discussion on why a fundamental redesign of our economic institutions is required and what it will involve. The second edition, as the first, is addressed to people who are acutely aware that things are going badly wrong economically, socially, and environmentally and are looking for real solutions based on new approaches and institutions.

The first edition of Agenda (Agenda I) was written and published in immediate response to the meltdown. It launched at a national theological conference at the historic Wall Street Trinity Church at the foot of Wall Street in New York City on January 23, 2009,. the day after the inauguration of Barack Obama as President of the United States.

The nation was in a state of euphoria born of hope that our new president would deliver on his promise of change. The euphoria has since evaporated as the reality became all too evident that Wall Street has a stranglehold on Washington, including on arguably one of the smartest and most visionary president the United States has ever had.

The public outrage at Wall Street excesses that swept Obama into the White House should have created fertile ground for serious action on economic reform. Wall Street's shameless actions since the meltdown have further strengthened the case for radical economic restructuring. Yet nothing of this nature has been forthcoming from the administration.

Wall Street interests stepped into the vacuum and used their financial, political, and media power to deflect the outrage away from themselves and focus it instead on would be reformers who proposed serious corrective action on such critical issues as health care, climate change, and financial regulation.

There are evident political explanations for President Obama's failure in this regard, but that is only part of the story. I realize in retrospect the extent to which his options were severely limited by the fact that neither of the two prevailing schools of economic thought--market fundamentalism or Keynesianism address the underlying institutional, social and environmental foundations of the problem he faced and therefore provide no framework for the needed institutional reforms.

The market fundamentalism of the prevailing Chicago School of economics is more ideology than science and its call to trust in markets driven solely by financial values to solve all problems led to policy decisions that virtually assured the collapse.

The Keynesian School recognizes an essential role for government in managing the money supply. Beyond this, however, it shares the Chicago School's embrace of GDP growth as the defining measure of economic performance, takes institutions as a given rather than a policy choice, makes no distinction between phantom wealth and real wealth, and has nothing to say about environmental limits and the nature and distribution of ownership.

Most of President Obama's economic advisers are inclined to the market fundamentalist view moderated by a Keynesian recognition that government has a necessary role. Neither of the two predominant schools of economics provides the framework needed to address the economic system's critical institutional flaws....

Apart from the political and intellectual context of Barack Obama's presidency, the leadership for institutional transformation rarely comes from those who depend on the existing institutions as their base of power. It necessarily comes from authentic grassroots movements, where the momentum for economic transformation is currently building below the radar of corporate media and the Washington political establishment.

Successful social movements, however, require more than a critique. They need a positive vision of possibility and an agenda for actualizing it. They too suffer from the failure of the prevailing economic models to provide a framework for a comprehensive economic restructuring. Many groups are now engaged in clarifying and elaborating a New Economy vision and agenda. My participation in countless such conversations over the past year and a half have substantially deepened my own understanding of the issues and the possibilities.


1 Although given the sorry state of the U.S. Congress it is all too easy to imagine such a dispute, I made up the point about the towels to make a point.

The Truth About Capital Gains

How the Rich Game the System
By GERALD SCORSE

When it comes to taxes on capital gains, the emperor suddenly has no clothes. He’s been stripped bare, in bipartisan fashion, by the co-chairs of President Obama’s fiscal commission.

The chairs are Republican Alan K. Simpson and Erskine Bowles, a Democrat. Their initial report included a call for equal taxes on capital gains, dividends and ordinary income such as wages. This upends the current tax code, and it contradicts almost the entire history of capital gains taxes in America.

Implicitly, it also rejects the K Street claim that tax breaks for capital gains grow jobs, grow businesses and grow the economy. If the claim had any truth, Messrs. Simpson and Bowles would never support equal taxes on all income as a way to help cut the national deficit.

Liberals instinctively attacked the right-leaning aspects of the report. House Speaker Nancy Pelosi, in full "no" mode, labeled its recommendations “simply unacceptable”. Not quite, Madam Speaker; apropos investment income, Simpson/Bowles is a Democratic dream come true.

Income from wealth and income from work were taxed at the same rate in only two widely-separated times in America—from 1916-21, and after Ronald Reagan’s Tax Reform Act of 1986. President Clinton restored the tax break on capital gains in 1997, cutting the rate on long-term gains from Reagan’s 28 percent to 20 percent. Six years later, President Bush lowered the levy to 15 percent and did likewise for dividends. The Bush cuts were written to expire in 2010, but it’s not certain they will. Even if they did, the capital gains rate would still be less than the rate on middle-class wages.

The Simpson/Bowles recommendations could die a quick death: a unified final report needs the votes of 14 out of the commission’s 18 members, comprised of nine from each party. If a super-majority of 14 can agree, their report arrives at the White House on December 1.

But the proposals are now on the table, so the genie is out of the bottle. President Obama and Congress were already facing a showdown on extending the Bush tax cuts. Now, in addition, Congress and the Administration have a rare opportunity to set a new course for the nation’s fiscal future.

They could start by revisiting the tax code and creating capital gains tax breaks that really would grow jobs and stimulate the economy. Small companies with big dreams raise seed money through initial public offerings (IPOs) and secondary offerings; larger companies sometimes do the same (e.g., the resurgent GM). In a move that would give a built-in boost to the market for new issues, capital gains on these investments could accrue tax-free. Interest on corporate bonds, now taxed as ordinary income, also deserves a tax break. Corporate bonds raise the money to build corporate infrastructure, much like municipal bonds raise money to build local infrastructure. Interest from municipal bonds gets tax breaks; why not corporate interest?

How to pay for these new tax breaks? Easy: the money would come from ending the unproductive tax break on stock market gains, along with the 2003 tax break on dividends.

In 1986, President Reagan essentially traded tax breaks on capital gains for another round of cuts in the marginal rates. A generation later, the initial draft from Obama’s fiscal commission holds the makings of a similar endgame.

One major milestone has already been reached. The notion that investments deserve a lower tax than wages has been vaporized. The emperor has no clothes, and really never did.

The Hidden Cost of Prohibition

Pot and the Deficit
By CHRISTOPHER BRAUCHLI

This week’s musings pertain to a leafy plant with the Latin name of Cannabis. It is a magical plant. When properly ingested or smoked, it can produce pleasurable physical affects on its user. But the didacticism of this column is about the fiscal, as distinguished from the physical, virtues of the plant. It is a column about common sense of which this country has precious little. It is a column about economics and compares the cost of leaving the leafy thing as an outcast in society or taking steps to help it gain respectability.

As might be expected, there are many ways of calculating the cost of treating the plant as something illegal to possess and it is beyond the scope of this column to choose between various studies. A column on AlterNet published by Paul Armentano in 2007 states that it costs $1 billion annually to incarcerate U.S. citizens for criminal violations associated with our little green friend commonly known as marijuana. Referring to the U.S. Department of Justice’s Bureau of Justice Statistics for 2005, Mr. Armentano says in 2005 there were 33,655 state inmates and 10,785 federal inmates incarcerated for marijuana offenses. Mr. Armentano further cites FBI reports that state that police arrested an estimated 786,545 people in 2005 on marijuana charges of which 88% were for possession only. Mr. Armentano was then the senior policy analyst for the NORML Foundation in Washington D.C., an organization devoted to educating American about marijuana and marijuana policy and his figures may be high.

A working paper entitled The Cost of Marijuana Prohibition on the California Criminal Justice System published in July 2010 by the Rand Drug Policy research Center analyzes more recent statistics and the works of Harvard economists, Jeffrey Miron and Dale Gieringer. According to the Rand paper, in 2005 Miron “estimated the dollar value of criminal justice resources being spent enforcing laws against marijuana production distribution and use” at $7.7 billion for the entire U.S. In 2010 those figures were revised upward to $13.7 billion of which $1.87 billion was California’s share. Mr. Giering, dealing exclusively with the California cost, comes in at a cost of $204 million and the Rand paper puts California’s cost in the range of $280 to $370 million per year. Whichever set of numbers is most accurate, the least of them is a large amount of money spent because of the leafy plant’s status in society. The cost of enforcing the laws is not the only cost associated with societal attitudes towards the plant. It is the other side of the equation-the amount of money that would be generated if marijuana were legalized and taxes and license fees imposed on those selling the product. In the United States, however, a puritanical instinct prevails, and communities and states are quite willing to cut off their noses to spite their faces.

In California, a state facing a 6 billion dollar budget shortfall for the current fiscal year and a $19 billion deficit for the 2011-2012 fiscal year, proposition 19, a ballot measure that would have legalized the personal use and possession of small amounts of marijuana, was defeated. Here is a sample of revenues the California voters rejected. Colorado, where medical marijuana sales are legal in a number of cities and towns provides Californians an insight into what they rejected. Fort Collins, home of Colorado State University (that permits its students to carry concealed weapons on campus) anticipates total receipts by year’s end of more than $250,000. Colorado Springs, home to Focus on the Family, is earning more than $50,000 a month in sales tax revenues. Boulder, home of the University of Colorado (whose students remain unarmed on campus pending the outcome of a lawsuit filed by those seeking six gun campus privileges) , anticipates receiving more than $400,000 in 2010. In addition to the amounts received by local communities, the state has received $2.2 million in tax revenue in 2010 and an additional $8.5 million in fees.

According to Donald Boudreaux, a professor of economics at George Mason University, prior to the advent of the personal income tax in 1913, liquor taxes accounted for one-third of the federal tax revenues. Those revenues dried up with passage of the 18th Amendment to the Constitution. Mr. Boudreaux suggests that the 1933 repeal of the 18th amendment had less to do with congress’s belief that prohibition was silly than with its need for the revenues provided by taxes on liquor sales. Following prohibition’s repeal, liquor taxes as a percent of federal government revenues jumped from 2 percent in 1933 to 9 percent in 1934 and 13 percent in 1936. Perhaps some day citizens will awaken and marijuana prohibition will go the way of liquor prohibition and sales and other taxes and fees will rise. So will the spirits of much of the populace. Don’t hold your breath.

Tying Bernanke's Hands

Why We Should be Grateful to China
By MIKE WHITNEY

Say what you will about Alan Greenspan, he was never a whiner. Unfortunately, the same can't be said about present Fed chairman Ben Bernanke. Bernanke's speech on Friday at a conference for the European Central Bank (ECB) was so full of crybaby blabber that attendees must have thought they'd ducked into a Frankfort daycare center by mistake. What an embarrassment! For nearly an hour, Bernanke went on and on about how mean China is and how they manipulate their currency to gain competitive advantage. It was surreal; like listening to a serial arsonist complain about his wife smoking in bed.

“Currency undervaluation by surplus countries is inhibiting needed international adjustment and creating spillover effects that would not exist if exchange rates better reflected market fundamentals,” Bernanke moaned.

Let's get this straight, when China's dollar peg was helping to recycle hundreds of billions of dollars into dodgy mortgage-backed securities and inflating a monstrous asset bubble that enriched Bernanke's crony friends on Wall Street, everything was hunky dory. But now that the Fed can't pump up another credit bubble by lowering interest rates, out come the handkerchiefs and everyone is supposed to feel sorry for poor little Bennie.

"Market fundamentals" be-damned. China is doing what is right for China. What's wrong with that? American citizens wish that the Fed and the Treasury would operate the same way and implement policies that supported the interests of US workers instead of lining the pockets of multinational capitalists and bankers.

Here's more from Bernanke:

"The exchange rate adjustment is incomplete, in part, because the authorities in some emerging market economies have intervened in foreign exchange markets to prevent or slow the appreciation of their currencies. ... why have officials in many emerging markets leaned against appreciation of their currencies toward levels more consistent with market fundamentals? The principal answer is that currency undervaluation on the part of some countries has been part of a long-term export-led strategy for growth and development. This strategy, which allows a country's producers to operate at a greater scale and to produce a more diverse set of products than domestic demand alone might sustain, has been viewed as promoting economic growth and, more broadly, as making an important contribution to the development of a number of countries."

That's right; China's export-led model is the root of its success, and it owes a debt of gratitude to greedy US corporations and the fine folks at the US Treasury who have supported labor-crushing "free trade" policies at every turn. If China has transformed itself into the world's second largest economy in a matter of a years, it has Washington to thank. So, why Bernanke complaining? Has his creation suddenly turned into Frankenstein?

Bernanke again:

"However, increasingly over time, the strategy of currency undervaluation has demonstrated important drawbacks, both for the world system and for the countries using that strategy."

In other words, it's all a matter of whose ox is getting gored. None of this mattered when homeowners were getting swindled in the biggest home equity ripoff of all time ($8 trillion in lost equity) or when Bernanke was bailing out his oily bankster buddies by handing them $1.75 trillion in reserves for their garbage mortgage paper that no one else would buy. Even in the depths of the slump when millions of unemployed workers faced the end of their benefits, and food stamp use had skyrocketed to 10% of the population, and the lines at the homeless shelters could be seen winding from sea to shining sea, Bernanke still refused to help. He still opposed a second round of fiscal stimulus aligning himself instead with the GOP deficit hawks.

But, all that has changed now, because the Fed can no longer move an interest rate lever at the central bank and affect the smooth transfer of wealth from one class to another--from debt peon to fatcat speculator. China is blocking Bernanke's ability to implement policy. Too bad.

Bernanke again:

"On its current economic trajectory the United States runs the risk of seeing millions of workers unemployed or underemployed for many years. As a society, we should find that outcome unacceptable. Monetary policy is working in support of both economic recovery and price stability, but there are limits to what can be achieved by the central bank alone. The Federal Reserve is nonpartisan and does not make recommendations regarding specific tax and spending programs. However, in general terms, a fiscal program that combines near-term measures to enhance growth with strong, confidence-inducing steps to reduce longer-term structural deficits would be an important complement to the policies of the Federal Reserve."

Hallelujah. So Bernanke has finally seen the Keynesian light and now supports more fiscal stimulus. Will wonders never cease? But doesn't that prove that Bernanke was wrong from the get go? Doesn't that prove that Milton Friedman, Anna Schwartz and all the nutcase "quantity of money" people were wrong and that the "aggregate demand" Keynesians were right?

As steward of the world's reserve currency, the Federal Reserve is not used to other countries dictating monetary policy, but that is precisely what is happening. China is in the drivers seat now. The Fed can buy up two-thirds of next years issuance of US Treasuries (which Bernanke plans to do) in order to push a wall of capital into emerging markets, but if China continues to recycle its dollars into US debt and maintain its dollar peg, then the Fed will not succeed. And, it's a good thing, too. If the last 10 years have taught us anything, it's that the unipolar world--where one country dominates politically, economically and militarily--is not good for anyone. It's time for a change. "Let a thousand flowers bloom," as Mao would say.

China has tied Bernanke's hands. The least we can do is be grateful.

Venture Bros. Season Finale Sunday Nov. 21

vidlink

Death of the Middle Class

Mourning in America
by Leo Gerard November 16, 2010

The deficit commission report issued last week is another Saturday night special pressed to the temple of the American middle class.

“Turn over your money and your benefits or your country will die,” the report screams at workers. “You want your country to go bankrupt? No? Then you gotta delay retirement, get less from Social Security, pay more for health insurance and lose your precious few income tax breaks like the one that helps pay your mortgage while the banker is breathing down your neck right now.”

For 30 years, rich conservatives have successfully threatened the American middle class this way, ever since that rich conservative Ronald Reagan converted the White House into a castle.

The result is a country with greater income inequality than during the age of corporate robber barons at the turn of the 20th century. It is a country whose 21st century robber barons, the richest 1 percent of Americans, take nearly a quarter of all income and demand that politicians relieve them of their obligations. The rich — hedge fund owners who rake in billions, Wall Street banksters handed bonuses in the millions, CEOs paid eight-figure golden parachutes after they mess up — insist that politicians place government debt burdens on the middle class, the unemployed, the elderly, the struggling young, people whose income has stagnated for three decades.

The co-chairmen of the deficit commission complied with that mandate from the flush when they recommended the middle class bear the brunt of the cost of reducing the deficit. Simultaneously, conservatives in Congress are acquiescing by insisting on extending tax breaks for the nation’s wealthiest. Those are the very tax breaks that contributed dramatically to creating the debt – the one that the deficit commission now wants heaped on workers’ backs.

This will be the death of the nation’s strength — its successful working class. Without the slightest regret or hesitation, the rich are killing the great American middle, rendering it a casualty of their shirked social responsibilities. Their campaign has been abetted by Republicans since Ronald Reagan. The Gipper contended slashing taxes for the wealthy would increase revenues for the government. Republican George H. W. Bush rightly ridiculed Reaganomics as voodoo.

In the GOP years between the beginning of Reagan in 1981 and the end of Bush II in 2009, the federal deficit exploded as Republican presidents failed to control spending and repeatedly cut taxes for the rich.

Reagan reduced the rate on the richest first down to 50 percent, then to 28 percent. The resulting budget deficit converted the U.S. from the world’s largest international creditor to its largest debtor. And now, the deficit commission sends the bulk of the bill for voodoo economics to the middle class, not the rich.

While Reagan gave the rich those breaks, income inequality increased. The share of total income taken by the richest 5 percent grew from 16.5 percent the year before he took office to 18.3 percent the year before he left. In that same time, the share of total income that went to the poorest 20 percent of households fell from 4.2 to 3.8 percent.

Democrat Bill Clinton fulfilled a campaign promise by increasing taxes on the rich — to a 39.6 percent marginal rate. He balanced the federal budget and left Bush II with a surplus.

Then Bush II squandered it. He gave the rich more tax breaks, accumulated debts larger than all those created by previous presidents combined and worsened income inequality. During his administration, from 2002 to 2007, the pretax income of the richest 1 percent increased 10 percent every year. Over that same period, the median income for working Americans declined and the poverty rate rose.

From Reagan through Bush II, more than four-fifths of the total increase in U.S. income went to the richest 1 percent. Hedge fund owners, whose income is literally in the billions, pay income taxes at 15 percent – lower than the rate paid by their secretaries, who earn far less in a year than any of the top 10 hedgers do in half an hour.

Wall Street recklessness crashed the U.S. economy, throwing millions of middle income earners out of their jobs and their homes. The banksters went to Washington and got politicians to hand them bailout billions, and now those Wall Streeters plan to increase their bonuses — while unemployment remains stuck at 9.6 percent in the Main Street economy.

It is those guys, bankers grabbing year end bonuses totaling two and three times what middle class earners get for a year’s labor; it is the five-home wealthy demanding that the foreclosed-on middle class suffer for the deficit. The rich, who have received the greatest benefits from this society, have no intention of paying their share of this national responsibility.

The deficit, the Social Security shortfall, difficulties with Medicare – they could all be solved if the nation returned to taxing policies that existed under Republican President Gen. Dwight D. Eisenhower, when the rate on top earners was 91 percent. That was not even the high point. In the mid-1940s it was 94 percent. Generally it fluctuated between 81 percent in 1940 and 70 percent when Reagan began slashing it in 1981.

Those rates may sound confiscatory now, but it’s not like the rich actually paid them after they subtracted out all of their exemptions, deductions, loopholes, special deals, tricks and wiles.

The dozen years in the 1950s and 1960s when the rate on the richest officially was 91 percent is a time considered by many Americans to be among the nation’s greatest for the middle class, a period when American workers could afford to buy homes, send their kids to college and travel across American on vacation.

There’s no talk of that now. Raising taxes on the rich now is considered ludicrous. Ridiculous. The whole Social Security shortfall could be solved if the rich paid taxes on their entire incomes, not just the first $110,000, a break that means the wealthy pay a smaller percentage if their income toward Social Security than the impoverished. But the deficit commission didn’t propose that.

No, the rich have succeeded in eliminating as a possibility their paying an increased tax share. Now, the only consideration is cutting their taxes. They didn’t hold an actual Saturday night special to anyone’s head. The rich are snake oil salesmen slick, Bernie Madoff-style schemers. They sold voodoo economics to America, and now they’re intent on making the middle class pay for what that policy has wrought in deficits.

Reagan’s re-election ad was wrong. He didn’t institute “Morning in America.” It was mourning for the once great American middle class.

Extend Jobless Benefits Not Tax Cuts For The Rich

Wednesday, November 17, 2010 by Talking Points Memo
Why The Lame Duck Congress Must Extend Jobless Benefits For Hard-Hit Families But Not Tax Cuts For The Rich
by Robert Reich

America's long-term unemployed -- an estimated 4 million or more -- constitute the single newest and biggest social problem facing America.

Now their unemployment benefits are about to run out, and the lame-duck Congress may not have the votes to extend them. (You can forget about the next Congress.)

The long-term unemployed can't get work because there are still five people needing work for every job opening. And the long-term jobless are often at the end of the job line: Either they don't have the right skills or enough eduction, or have been out of work so long prospective employers are nervous about hiring them.

They're also a big problem for the economy. Without enough money in their pockets, they and their families can't pay their mortgages, which keeps fueling the mortgage crisis. Nor can they replace worn-out cars and clothing, or buy muchof anything else, which is a drag on the economy.

Republicans and many blue-dog Dems say we can't afford another extension.

But these are many of the same people who say we should extend the Bush tax cuts for the wealthy for at least another two years.

Extending the Bush tax cuts for the top 1 percent would cost an estimated $120 billion over the next two years. That's more than another unemployment benefit extension would cost.

The unemployed need the money. The rich don't.

Moreover, the top 1 percent spends a small fraction of their income. That's what it means to be rich -- you already have most of what you want. So extending the Bush tax cut to them won't stimulate the economy.

Yet people without jobs, and their families, are likely to spend every penny of unemployment benefits they receive. That will go back into the economy and save or create jobs.

A Labor Department report shows that for every $1 spent on unemployment insurance, $2 are spent in the economy. If you don't believe the Labor Department, maybe you'll believe Goldman Sachs analyst Alec Phillips, who estimates that if unemployment benefits are allowed to expire, the American economy would slow by a half a percent.

Republicans are still spouting nutty Social Darwinism. Cutting taxes on the rich is better than helping the unemployed, they say, because the rich will create jobs with their extra money while giving money to the unemployed reduces their desire to look for work.

Rubbish. The Bush tax cuts on the top never trickled down. Between 2002 and 2007 the median wage dropped, adjusted for inflation. And job growth was pathetic.

Jobless benefits don't deter the unemployed from finding work. In most states, unemployment benefits are a fraction of former wages. And as long as unemployment remains sky-high, there are no jobs to be had anyway.

Besides, the economic downturn was hardly their fault. If anyone is to blame it's the high-flyers on Wall Street who gambled away other people's money, and the rich denizens of corporate executive suites who have sliced payrolls in order to show higher profits (and get more money from their stock options).

So why reward the people at the top with an extension of the Bush tax cut that will blow a hole in the budget deficit? And why fail to extend jobless benefits to hardworking Americans who got the boot?

Quick action is needed. Jobless benefits begin to lapse in just two weeks. Two million unemployed workers will be affected. If Congress fails to act, another 1.2 million will stop receiving benefits by the end of December. Most of the rest of those who now receive federal emergency extended benefits will gradually lose them.

Don't extend the Bush tax cuts to the wealthy. Give unemployment benefits to people who need them.