I find it disturbing that a major city being put on lockdown in order to accommodate the international elite and suppress the underclass has become standard — and acceptable — procedure.
Right now, the leaders of rich and developing nations are in Toronto, and the authorities anticipated that there will be a series of protests during the conferences because there are always protests during the G8/G20 meet-ups.
Capitalism is particularly unpopular right now because the US has unleashed a steroid-filled version of it unto the world, and this economic system has failed to provide for the majority of people. It has, however, created a dwindling elitist echelon who control a vast majority of riches. In the year of Hayward and his yachting adventures, there’s no reason to doubt there will be any fewer protests against the douchiest rich people among us.
Toronto was ready to suppress such dissent, and shape a nice, pleasant narrative for the city’s visitors, by implementing a complete and total lockdown.
The “lockdown” of central Toronto includes a 3m-high (10ft), 3.5km (2.2-mile) concrete and metal fence enclosing the G20 meeting area and a huge security presence. Banks and theatres will be closed, as will one of Canada’s most famous tourist attractions – the CN Tower.
It’s important to remember that the supposed goal of the G20 summit is “to continue the work of building a healthier, stronger and more sustainable global economy.” And what better way to express that kind of egalitarian unity than to build a 10-ft-high, 2-mile-long fence to keep out the serfs?
These kinds of global gatherings have also become a playground for authorities to experiment with their newest, shiniest crowd control devices. Last year, I reported that Pittsburgh police demonstrated the latest suppression technology on protesters near that year’s G20 summit. The weapon du jour were sound cannons.
Here is an interesting interactive map that shows the more than 10 million relocations made by Americans from one county to another during 2008. I took a few screen shots to highlight some interesting trends.
Sully focuses on the migration to Texas, which he calls the “Blue flight to a red state.”
I really doubt the people fleeing from New York and California are mostly diehard Libertarians, who don’t want their tax dollars going to The Man. More than likely, they’re looking for jobs, and hey, if they can save money by not being taxed by the state, what poor person is going to turn that down?
I’m not condoning that logic. After all, citizens fleeing to Texas is a race to the bottom. If all states suddenly adopted Texas’s bare bone approach, citizens would lose all kinds of services, namely because no one would be paying to preserve public services. What I’m saying is it’s understandable that poor, desperate people would see moving to taxless Texas as a perk.
Politicians from both sides of the aisle are claiming that they can’t invalidate AIG’s staggering $165 million in bonuses because This is America And We Honor Contracts. On Sunday, Larry Summers, Obama’s director of National Economic Council, said that while the bonuses were outrageous, they represented contracts that could not be broken. Of course, Glenn Greenwald points out that the government had absolutely no qualms with breaking the United Autoworkers’ contracts with the Big Three during their bailout.
And Summers’ claims are false because This is America and We Break Contracts All The Time. In fact, corporations and the government are super talented at wiggling out of contracts that prove too strenuous to honor. That’s why there are so many lawyers trolling around Washington – they’re there precisely for this occasion when lawmakers need to get out of an unsavory contract.
Lawrence Cunningham, a professor at George Washington University Law School, spells out all the easy ways the government and/or AIG could get out of paying those bonuses:
1. If employees did not meet performance goals, AIG doesn’t have to pay them bonuses. Considering AIG was one of the worst offenders when it came to selling bundled subprime mortgages, it should be fairly easy to prove that AIG employees don’t deserve to be paid $165 million in bonuses.
2. If you were fired (or should have been fired,) AIG doesn’t have to pay you. Again, you breached your contract, so you’re shit out of luck.
3. If an employee was not absolutely candid about their shady practices, their bonuses can be withheld. Everyone at AIG knew their subprime mortgage dealings were shady, but that doesn’t excuse individual players from responsibility.
4. It’s impractical for AIG to shell out cash loaned to them by taxpayers. AIG does have the option to say, “Sorry, we can’t afford to do this right now.”
5. Sweetheart deals are illegal. Cronyism hurts not only shareholders, but in this case, taxpayers.
And there are many more ways for AIG and the government to deny these bonuses. It’s a lack of will preventing that from happening. But the excuse that AIG and the government are somehow “obligated” to pay $165 million to AIG employees is complete and utter bullshit.
Update: Kevin, a reader, makes the excellent point that the We Don’t Break Contracts logic would mean California’s gay marriages should be made legal again. After all, This is America. We Honor Contracts, and what contract is more sacred than the vow of marriage?
Glenn Greenwald has written an excellent piece about the AIG bonuses, and the contracts guaranteeing those bonuses that are apparently too sacred and holy to break. Of course, our government stood idly by and let the Big Three shatter all kinds of contracts with the UAW, and nary a word was uttered about the holiness of those contracts. In America, the only contracts that matter are the ones belonging to billionaire CEOs.
An excerpt from Greenwald’s article:
Apparently, the supreme sanctity of employment contracts applies only to some types of employees but not others. Either way, the Obama administration’s claim that nothing could be done about the AIG bonuses because AIG has solid, sacred contractual commitments to pay them is, for so many reasons, absurd on its face.
As any lawyer knows, there are few things more common – or easier — than finding legal arguments that call into question the meaning and validity of contracts. Every day, commercial courts are filled with litigations between parties to seemingly clear-cut agreements. Particularly in circumstances as extreme as these, there are a litany of arguments and legal strategies that any lawyer would immediately recognize to bestow AIG with leverage either to be able to avoid these sleazy payments or force substantial concessions.
Read the rest here.
Working families were in deep trouble long before this megarecession hit. But too many of the public officials who should have been looking out for the middle class and the poor were part of the reckless and shockingly shortsighted alliance of conservatives and corporate leaders that rigged the economy in favor of the rich and ultimately brought it down completely.
As Jared Bernstein, now the chief economic adviser to Vice President Joseph Biden, wrote in the preface to his book, “Crunch: Why Do I Feel So Squeezed? (And Other Unsolved Economic Mysteries)”:
“Economics has been hijacked by the rich and powerful, and it has been forged into a tool that is being used against the rest of us.”
Working people were not just abandoned by big business and their ideological henchmen in government, they were exploited and humiliated. They were denied the productivity gains that should have rightfully accrued to them. They were treated ruthlessly whenever they tried to organize. They were never reasonably protected against the savage dislocations caused by revolutions in technology and global trade.
Working people were told that all of this was good for them, and whether out of ignorance or fear or prejudice or, as my grandfather might have said, damned foolishness, many bought into it. They signed onto tax policies that worked like a three-card monte game. And they were sold a snake oil concoction called “trickle down” that so addled their brains that they thought it was a wonderful idea to hand over their share of the nation’s wealth to those who were already fabulously rich.
America used to be better than this.
The seeds of today’s disaster were sown some 30 years ago. Looking at income patterns during that period, my former colleague at The Times, David Cay Johnston, noted that from 1980 (the year Ronald Reagan was elected) to 2005, the national economy, adjusted for inflation, more than doubled. (Because of population growth, the actual increase per capita was about 66 percent.)
But the average income for the vast majority of Americans actually declined during those years. The standard of living for the average family improved not because incomes grew but because women entered the workplace in droves.
As hard as it may be to believe, the peak income year for the bottom 90 percent of Americans was way back in 1973, when the average income per taxpayer, adjusted for inflation, was $33,000. That was nearly $4,000 higher, Mr. Johnston pointed out, than in 2005.
Men have done particularly poorly. Men who are now in their 30s — the prime age for raising families — earn less money than members of their fathers’ generation did at the same age.
It may seem like ancient history, but in the first few decades following World War II, the United States, despite many serious flaws, established the model of a highly productive society that shared its prosperity widely and made investments that were geared toward a more prosperous, more fulfilling future.
The American dream was alive and well and seemingly unassailable. But somehow, following the oil shocks, the hyperinflation and other traumas of the 1970s, Americans allowed the right-wingers to get a toehold — and they began the serious work of smothering the dream.
Ronald Reagan saw Medicare as a giant step on the road to socialism. Newt Gingrich, apparently referring to the original fee-for-service version of Medicare, which was cherished by the elderly, cracked, “We don’t get rid of it in Round One because we don’t think it’s politically smart.”
The right-wingers were crafty: You smother the dream by crippling the programs that support it, by starving the government of money to pay for them, by funneling the government’s revenues to the rich through tax cuts and other benefits, by looting the government the way gangsters loot legitimate businesses and then pleading poverty when it comes time to fund the services required by the people.
The anti-tax fanatic Grover Norquist summed the matter up nicely when he famously said, “Our goal is to shrink the government to the size where you can drown it in a bathtub.” Only they didn’t shrink the government, they enlarged it and turned its bounty over to the rich.
Now, with the economy in free fall and likely to get worse, Americans — despite their suffering — have an opportunity to reshape the society, and then to move it in a fairer, smarter and ultimately more productive direction. That is the only way to revive the dream, but it will take a long time and require great courage and sacrifice.
The right-wingers do not want that to happen, which is why they are rooting so hard for President Obama’s initiatives to fail. They like the direction that the country took over the past 30 years. They’d love to do it all again.
WARREN BUFFETT knows there’s something very unfair about the American tax system. He’s often complained that while his 2006 tax rate (for federal income taxes and Social Security withholding) on $46 million of income was 17.7 percent, his secretary’s combined tax rate was 30 percent.
There are effectively two tax systems in America: one for the very rich and one for the rest of us. Income from stock dividends and capital gains, which makes up a disproportionate amount of the earnings of the very rich, is taxed at 15 percent. But the bulk of what the rest of us earn — wages and interest from savings accounts — is taxed at up to 35 percent. Though President Obama’s recent tax proposals are progressive and comprehensive, his reforms don’t do nearly enough to address this significant disparity.
Yes, President Obama’s plan would eliminate the loophole that has allowed hedge fund titans, whose income comes in no small part from management fees, to be taxed at just 15 percent instead of the ordinary income tax rate.
Families earning more than $250,000 and singles earning more than $200,000 would likewise see taxes on their wages and interest increased to a top rate of 39.6 percent from 35 percent. And the rate on both capital gains and dividends on the sale of stock would increase, but only to 20 percent from 15 percent. These changes lessen the unfairness in our tax system; they don’t eliminate it.
The gap between the tax rates for the rich and the rest of us is relatively recent. Until 1921, capital gains were taxed at the same rate as ordinary income. Then Congress enacted a law that taxed capital gains at 12.5 percent while ordinary income was taxed at as much as 58 percent.
In the decades since, the tax rate on capital gains varied — sometimes it increased, sometimes it decreased. But with the exception of a brief period in the late 1980s, it was always lower than the tax on ordinary income. That was not the case for stock dividends, which were taxed like wage income and savings account interest — that is, until President George W. Bush and Congress in 2003 gave dividends the same preferential treatment as capital gains. The Bush tax cuts moved our tax system too far in the wrong direction.
There is a flip side to raising the tax rates for dividends and capital gains. In this market, there won’t be too much capital gain to worry about. So how should we treat capital losses?
Under current law, capital losses that exceed capital gains can be deducted up to $3,000 (losses above that limit can be carried forward indefinitely into future tax years). If we increase the tax rate on capital gains, then a more generous limit on capital losses should almost certainly be allowed. During the presidential campaign, Senator John McCain proposed increasing the $3,000 offset against ordinary income to $15,000. It’s an idea worth dusting off.
The question of how to tax capital gains and dividends is one of fundamental fairness. Why should tax law treat income from savings accounts differently from income from a diversified stock portfolio? Either we push up the rates on corporate dividends and capital gains or we lower the rates on wages and interest: it’s all income and it should all be taxed at the same rate.
(Please Note: Since first posting this piece, some claims asserted in the Ames/Levine post cited herein have been responded to in a way that makes my initial reading of that article less certain. To reflect that, I have revised the title to include a “?”, added an UPDATE section at the bottom of the post, and included in-line links to that update section where relevant. Some questions were answered, some new questions have emerged, and so the conversation has grown. –ed.)
Populist revolt against the U.S. government is all the rage in the Republican Party, these days. As they tell the story, the public is so outraged by the recovery and reinvestment efforts of the Obama administration that Americans everywhere are turning out to overthrow the tyrannical king of the federal government by re-enacting the Boston Tea Party.
Everything about this so called “Tea Party” movement was pre-planned–from the supposedly “spontaneous rant” of CNBC stock market reporter, Rick Santelli, to the presumed ground-level organizing of protests all over the country. Fake, fake, fake–like a product launch staged covertly to look like a spontaneous trend. (please UPDATE below)
What hasn’t been reported until now is evidence linking Santelli’s “tea party” rant with some very familiar names in the Republican rightwing machine, from PR operatives who specialize in imitation-grassroots PR campaigns (called “astroturfing”) to bigwig politicians and notorious billionaire funders. As veteran Russia reporters, both of us spent years watching the Kremlin use fake grassroots movements to influence and control the political landscape. To us, the uncanny speed and direction the movement took and the players involved in promoting it had a strangely forced quality to it. If it seemed scripted, that’s because it was.
What we discovered is that Santelli’s “rant” was not at all spontaneous as his alleged fans claim, but rather it was a carefully-planned trigger for the anti-Obama campaign. In PR terms, his February 19th call for a “Chicago Tea Party” was the launch event of a carefully organized and sophisticated PR campaign, one in which Santelli served as a frontman, using the CNBC airwaves for publicity, for the some of the craziest and sleaziest rightwing oligarch clans this country has ever produced. Namely, the Koch family, the multibilllionaire owners of the largest private corporation in America, and funders of scores of rightwing thinktanks and advocacy groups, from the Cato Institute and Reason Magazine to FreedomWorks. The scion of the Koch family, Fred Koch, was a co-founder of the notorious extremist-rightwing John Birch Society.
It helps, in other words, to have field experience ferreting out Soviet propaganda to understand how Rick Santelli suddenly became the figurehead of a right-wing “grassroots” revolt against the United States government. It is worth reading the entire post.
The next time you hear that the Tea Party Republican revolt is “grassroots,” “spontaneous,” and “populist,” just swap out those PR keywords for the more accurate terms: “planned,” “scripted,” “billionaire bigwigs.”
All of this makes sense, of course. Santelli’s philippic had all the hallmarks of a rehearsed piece of political theater–the pre-planned message launched of a viral marketing campaign. (please UPDATE below)
Not that any of this comes as a surprise, but…my goodness.
Even though the curtain has been pulled back on this astroturf marketing by GOP megabucks elite backers, it is important to keep in mind what the larger stakes are and how to respond.
Scripted or not–this Tea Party revolt needs to be treated as politically real. People engaged in this agitation will not acknowledge ever that it is scripted, because these folks sincerely think they are engaged in some kind of revolution against their own government. They really want the country to evaluate whether or not an elected President and Congress are the same as a tyrannical king and whether a tax by fiat from the 18c is the same as a legislature approved public investment program from the 21c. Those folks just want to make noise–lots of noise–to throw the debate off its tracks.
The big story to defend and advance, in other words, is a president advancing real solutions aimed at helping millions of Americans in serious economic trouble. The agitation against it, whether it is scripted or not, is designed to stop those solutions from being discussed seriously, from unfolding, and then to weaken the president making them happen. That is a basic confrontation between pragmatic action and ideological politics–between investment in people and inaction in the name of dogma.
In the end, then, we need to make themselves aware of the massive resources the right is spending to block any effort by the American people to work together to repair the damage to our economy and restore our national confidence. And after we have made ourselves aware of how far the opposition is willing to go, we need to get back to work making sure the debate states focused on the real issue at hand here: millions and millions families who need help right now, and the greatness of a nation that stands together in times of need to overcome seemingly impossible obstacles.
: This Story Has Grown (3.3.09)
Well, that was fast: this story, less than a week old, seems way out of date. Among other things, there have been lots of answers to the claims posed in the Ames/Levine piece that it warrants opening up my initial title to a bigger question about what exactly happened. First and foremost, I have added a question mark (“?”) to the end of the post title to reflect how this story has grown since I first posted about the Ames/Levine piece on Rick Santelli. Here is the list of events that I think are relevant for everyone to know:
1. Santelli finally made a statement about this whole thing here. This is his first paragraph:
First of all let me be clear that I have NO affiliation or association with any of the websites or related tea party movements that have popped up as a result of my comments on February 19th, or to the best of my knowledge any of the people who organized the websites or movements. By the way of background, I am not and never have been a stockbroker. Not that there is anything wrong with being a stockbroker. The home I have lived in for 20 years is a 2,500-square foot ranch. Not that there is anything wrong with owning a larger, grander house. I am currently an on air editor with CNBC. Prior to my 10 years in this capacity I was a member in good standing on both the Chicago Futures Exchanges. My career in the futures industry spanned 20 years.
Seems like an answer, although I wish he had not used the phrase ‘to the best of my knowledge’–which makes him sound like he talked to a lawyer first. When people deny that they knew someone or were involved in something ‘to the best of my knowledge,’ that typically means they are concerned about accidentally committing perjury if a fact comes out later that shows they were in fact involved. Does that mean Santelli might have been involved in something without knowing it? I have no idea; I am not an attorney. It could be that Santelli just adds that sentence as a routine part of insulating himself from accusations of financial conflicts of interests. Since he reports from a trading floor, that kind of legalese could just be routine. So, Santelli has spoken and that is where it ended up.
2. Whether or not CNBC actually asked Santelli if he was involved in any organizing is the obvious question. As a result of filing that exact query, the Columbia School of Journalism’s blog Full Court Press(FCP) posted the following exchange they had with CNBC spokesman Brian Steel:
All this led Mark Ames and Yasha Levine to speculate at playboy.com that Santelli’s fifteen minutes were actually part of a right-wing Republican disinformation campaign to undermine Obama’s efforts to rescue the economy. Asked about this charge by FCP, CNBC spokesman Brian Steel sent an e-mail saying, “Rick Santelli’s comment clearly struck a nerve among a large portion of American citizens and sparked a debate which is something Rick has done for more than a decade as a commentator on CNBC. To try to make anything more of his comment than that is ridiculous and without basis in fact.”
FCP e-mailed back, “On the record: was he asked by his bosses if he was part of a larger organized effort? What “news” purpose was served by repeating this rant over and over again on CNBC, and promoting him (and it) on the Today Show?”
“We don’t comment on internal CNBC discussions,” Steel replied. Then, although FCP had specified that it was only interested in an on-the-record response, he added: “Off the record it strikes me that my first answer is unquivocal [sic] and should answer all your questions. Also off the record I am curious as to why CJR has written about it at least three times particularly since each time your readers via the comments section of your website have overwhelming disgreed [sic] with your views. It seems as if you are both tone deaf and hypocritcal [sic].”
So much for asking follow-up questions in the world of cable news.
Once the accusations of ‘hypocrisy’ come out, that tends to be a sign that nobody wants to have a grown-up conversation anymore. Steel is clearly doing his job, which is to spread the chosen message that Santelli’s performance was consistent with his long history of making statements that spark widespread debate amongst American citizens. In all fairness to Steel trying to get out CNBC’s message, the only example of Santelli sparking debate I can think of is the time he called for ‘Tea Parties’ last week. So CNBC should probably issue a list of debates Santelli sparked if they want that message to take.
3. Playboy took down the Ames/Levine post (as of Mar 2, from what I can tell). They have not issued any kind of statement.
4. Ames and Levine are sticking by their story, following up with a not-so-subtle piece titled CNBC Bitch-Slaps Santelli Into Line, FreedomWorks Admits It Organized “Grassroots” Tea Parties, Jon Stewart Cancels Santelli & Megan McArdle Queefs On Our Founding Fathers.
5. Among other things, the Ames-Levine follow-up piece cites an AP article that they say backs up their initial claims. The provide a link to a Star-Tribune article titled CNBC Says Ranting Rick Santelli is not Affiliated with Political Site that Uses his Name (David Bauer, Mar 2, 2009). The article goes on to desccribe how the site reateaparty.com included enough references to Santelli for readers to conclue that Santelli was involved with the group–right up to an ‘About Rick Santelli’ page, but took down all the references when asked to do so by CNBC.
So, what can we conclude thus far? The Tea Party folks would have us conclude that anyone who asked these questions about Santelli (me, for example) is an idiot leftie. No surprise about that reaction, but there is more to be said.
In particular, I still wonder about two missing pieces of information: (1) why did Playboy take down the original post and (2) why did Santelli use the phrase ‘to the best of my knowledge’ in is rebuttal. It seems fair to wonder about those things, given that the debate supposedly sparked by all this has led to cries of anti-government revolution (no small thing).
To speculate on the first: Playboy probably took it down for fear of a boycott or of being sued or both. Despite the racy content of the magazine, Playboy is still a relative newcomer to the world of political blogging. They likely decided to just pull back and wait this thing out.
To speculate on the second: Santelli probably said ‘to the best of my knowledge’ because CNBC advised him to–which is perfectly legal, logical, reasonable, etc. And CNBC probably advised him to say it because they had not yet figured out if Santelli was really involved with any of the sites that seemed to claim him as a participant. CNBC then got to work examining all the free marketing they received as a result of Santelli’s performance, putting Santelli and their brand back in the bottle as much as they could (which is their legal right), and pushing back against questions from bloggers and journalists who were wondering (also fairly) about those connections.
And that brings us up to date.