Dec 26, 2010
There will be no more California strawberries in this house. Their Department of Pesticide Regulation recently (at the tail end of Republican Schwarzenegger’s last term as governor) approved the use of methyl iodide as a pesticide for their state’s strawberry fields. California’s own Scientific Review Panel stated that “methyl iodide is a highly toxic chemical” whose use “would have a significant adverse impact on public health.”1
But this is how it happens in a corporate-dominated society. If Arysta LifeScience Corporation, the largest private pesticide company in the world according to the Pesticide Action Network (PAN),1 wants to spray a carcinogen all over your strawberries, infecting the workers who plant and pick them and, potentially, the groundwater which millions of Californians depend on, then by god Arysta will do it. They will get the Bush administration’s EPA to sign off on its use, they will hire PR and lobbying firms to buy off our elected representatives, and they will convince you, with lower prices and massive advertising campaigns, to ignore your and your children’s best interests and buy their poison by the truckload.
The Scientific Review Panel’s findings and other documents related to this scandal, may be found at the PAN link below. Read them and weep. Then write the new governor and the EPA, both of whom have indicated they may reverse the decisions allowing this travesty in public health.
1 Pesticide Action Network North America
Nov 10, 2009
If you have not read Naomi Klein’s The Shock Doctrine: The Rise of Disaster Capitalism, then waste no time, click on this link, and buy it now, or run out to your local library for a copy.
Read but a small portion of it and you will understand why our elected representatives could pass a health care “reform” bill last weekend that 1) requires every man, woman, and child in our country to purchase coverage from a corporate health insurance provider for the rest of our lives; 2) does not allow states to craft their own public, single-payer option; 3) protects patents for many of the most important drugs of the future from ever expiring and allowing the manufacture and sale of less expensive generics; and 4) denies coverage for vital and legal medical procedures to the population which needs them most.
We can only hope that the Senate introduces sufficient additional horrors into this bill to assure its failure. In other words, the best health care reform we can hope for now is no health care reform. Because this is not reform. This is Disaster Capitalism at its worst, a huge windfall for the corporatocracy, paid for by the poor and the middle class, yet again.
Klein’s book lays out the pattern and policy of torture—physical, social, and economic—pursued by the corporatocracy, and abetted by their minions in the government, since the end of World War II. The goal: to enrich the few at the expense of the many. And it has been working like a charm, in case you hadn’t noticed. Her book, thoroughly supported with references, is an eye opener of extraordinary proportions. No one who reads it will ever feel the same about our country. And having turned its last page and set it down, you will be forced with a choice: hope or despair.
I still believe there is hope. However, it must manifest itself soon in real action by the American people to reclaim our national ideals. If we aren’t up to the task, more than this nation will suffer the consequences. Our species will self-destruct, and those surviving will not miss us.
Apr 30, 2009
The Federal Election Commission (FEC) has reminded us, exhausted as we all may be from a two-year campaign that seems to have ended only yesterday, that we are indeed in another—indeed always in another—election cycle. The convenient maps they have provided at their web site provide a reminder—as if we needed one—of what this 2009-2010 campaign is really about. (Hint: The same as the last one.) The amount in parentheses is the cash on hand in the candidate’s campaign war chest as of Mar 31, 2009.
Feb 03, 2009
We receive a daily email from the Aerospace Industry Association which provides all sorts of news and gossip regarding the Military-Industrial Corporatocracy that runs the show here in Freedomland. A scan of the latest headlines provides a good taste of this resource, which you can sign up for here.
Jan 26, 2009
On Day One last week, Obama slammed a couple of doors. Time will tell whether he locked them or not.
And it was none too soon, as was revealed in Revolving Doors, a report from Citizens for Responsibility and Ethics in Washington (CREW) released on January 12, 2009. Their painstaking research into the activities of Bush 2 cabinet officials after leaving “public service” is harrowing, maddening, and finally nauseating. We knew there was a revolving door between federal government service and the corporate entities those servants had previously been charged with regulating. But this! To take but one example of the 24 presented in this report:
Spencer Abraham, Sec. of Energy, 2001-2005 (during Enron and the worst blackout in history). Shortly after his government service, he:
Jan 08, 2009
Naomi Klein’s The Shock Doctrine masterfully lays bare the tendency of the right to take advantage of disasters to advance their agenda. There is no reason why progressives can’t take a page from that playbook, and no time like the present.
The Political Economy Research Institute (PERI) of the University of Massachusetts at Amherst, together with the Bernard Schwartz Center for Economic Policy at the New School in New York, have published A Progressive Program for Economic Recovery & Financial Reconstruction (.pdf, 25 pp., 192Kb).
Yesterday, we noted the ways the bailout is going wrong, even failing to achieve its nonprogressive ends. This PERI report shows the way for the Obama administration to reverse these failings and instead achieve a successful financial recovery for progressive ends. Obama’s program, they say, “must promote a fundamental reversal of direction ... [F]inancial markets must ... serve the needs of society.” The report is an excellent summary of the progressive viewpoint toward markets and society. Following are a few of its recommendations, together with an estimated cost of some (see the report for details):
Jan 07, 2009
We have been trying to make head or tail out of the financial debacle for weeks now.1 Two reports have been released in the recent past by the Treasury Department, attempting to explain what they have done with the money and with the power conferred upon them by Congress last fall. One report was sent to Congress2 and one to the Congressional Oversight Panel3.
We diligently attempted to read both of these reports but had to conclude, along with poor Casca, that “it was Greek to [us].” One recalls the “Plain English” laws passed a few years ago in the realm of public contracts (insurance, etc.), and wonder whether we should not pass one for the federal government. Obfuscation, of course, is an important tactic used by the guilty to hide their shame, and one can only conclude that the dense unreadability of these reports is intentional and so motivated. Our frustration level was so high that we send a heartfelt message to Paul Krugman begging him to read the reports and translate them for us common mortals.
In the meanwhile, the New York Times published a pair of op-ed pieces last Sunday entitled The End of the Financial World As We Know It, and How to Repair a Broken Financial World, by Michael Lewis and David Einhorn, which added some to our understanding of what went on and where we go from here:
Jan 03, 2009
See, here’s the problem in a nutshell, and since this nutshell is killing our children, perhaps we’ll be inclined to listen.
We import 90 percent of our toys now, and 90 percent of those imports come from China.1 Yet, while toy imports were increasing 562 percent between 1980 and 2008, the U.S. agency responsible for assuring their safety, the Consumer Product Safety Commission (CPSC) was seeing its budget cut by a fifth and its staff reduced by nearly 60 percent. The CPSC has exactly zero full-time staff working at any of the 326 U.S. ports, and they concentrate their part-time efforts on only two of them, Los Angeles and New York, leaving the other 324 virtually unchecked.
Meanwhile, over a dozen trade agreements have promoted and protected the toy industry’s offshore production and lax safety standards.
Unsafe products are pouring into our country, produced in overseas sweatshops that enforce no labor or environmental protections. Public Citizen’s 2007 report (.pdf, 30 pp., 543Kb) details the major causes of toy recalls over a ten-year period, shows how corporations have created global supply chains to avoid product liability laws, and relates how U.S. CEO pay has skyrocketed over the same period.
Do we see a pattern here? Are we beginning to understand what is behind “Always Low Prices”? Do we see now why all those unruly young people show up at globalization conferences?
The 2008 report discovers a silver lining in the 71 newly elected senators and representatives who favor sane trade policies. Time will tell.
Meanwhile, google toys china and look out you don’t get buried in lead Mattel recall.
1 Closing Santa’s Sweatshop (.pdf, 27 pp., 280Kb), from Public Citizen, December 2008, pg. 3 (accessed December 30, 2008)
Dec 30, 2008
We have written about public-private partnerships (PPPs or P3) before (see Water, Incorporated, Interstate, Inc., and Public-Private Partnerships). In the coming collapse, government on all levels will be sorely tempted to turn over public assets to private business in exchange for a fat check up front. In most cases, they will be making a serious mistake.
No state is more likely to succumb to the fat check temptation than California, and it is good to see that Los Angeles at least is aware of some of the pitfalls and is proceeding with something akin to responsible conduct. The Office of the City Controller has funded a study by The PFM Group entitled Special Study to Assess Opportunities to Develop Public-Private Partnerships (.pdf, 96 pp., 888Kb).
The study takes a stab at covering all the bases that need to be considered by a municipality when it is contemplating turning over to private enterprise an asset or service heretofore provided by the public sector. It has a clear bias toward favoring PPPs. This document is nonetheless important for anyone to read who may become involved in the near future with the questions it addresses, and that probably includes most of us who try to keep an eye on what our town, state, and federal government are up to in advancing PPPs. A section entitled “Addressing Misconceptions Regarding P3s” includes the following:
“PPPs negatively impact labor. ... The concern of many labor representatives is that a P3 concession will result in lost jobs, lower wages, reduced benefits, and loss of job security. However, in many P3 arrangements, contracts have been structured such that all previous government employees are assured a job position with the same level of salary and benefits.”1 Then later, when the paper provides a case study of an existing contract for custodial services that saved L.A. County a lot of money, “the commission concluded that the savings from contracting was attributable to reduced labor costs, as contractors pay lower wages and sometimes employ fewer workers.”2
Exactly. Too often PPPs are merely ill-disguised attempts to, once again, deprive the working man and woman of a decent salary in order to put more dollars into the pockets of the bosses. In 2007, 39.8 percent of public sector workers enjoyed union membership coverage, while only 8.2 percent of private nonagricultural workers were covered.3
We are in a race to the bottom in this country, with a war on unions and an unrestricted globalization that is exporting good-paying jobs as well as doing an end run around decades of struggle for labor and environmental protections.
And let us not forget: We privatize our health care in this country, and it costs us twice what other industrialized countries pay while delivering an inferior product. Federally managed Medicare and Medicaid, on the other hand, are delivered with much greater efficiency and less cost than the health care most of the rest of us receive. Let that be a lesson to us.
Also Noted: See the Rand report, A Call to Revitalize the Engines of Government (.pdf, 28 pp., .2Mb), by Bernard D. Rostker. This call for a return to common sense concludes, “The new administration should not try to fool the American people, perpetuating the myth of smaller government by not counting the hordes of service contractors its engages. Clearly, there are things that should be contracted and that the government need not and should not undertake, but the unfettered use of contractors has skyrocketed and must be brought under control.”
1 Special Study to Assess Opportunities to Develop Public-Private Partnerships, pg. 11, accessed December 27, 2008 (as were other footnoted items in this posting)
2 Op. cit., pg. 35
3 Index of Tables: Union Membership and Coverage, from Georgia State University
Dec 26, 2008
Are unions dead in this country? Are over a hundred years of courageous labor struggles—struggles the working men and women had to wage against their own government as much as against their bosses—now history, only history?
Thirty-five years ago, a quarter of all nonagricultural workers in the private sector were unionized; in 2007, that number was down to 7.5 percent. In private manufacturing, the picture is worse, going from 39 percent unionized workers in 1973 to just over 11 percent today.1
Meanwhile, when the auto industry collapses, it’s the greedy workers’ fault. Cut their pay, cut their benefits, whittle them down as close to nothing as we can. Is education in trouble in this country? Then it’s the greedy teachers’ fault. Bust their selfish union, destroy public education in the only country that attained greatness through that institution.
Bob Herbert wrote in his column this week, “The economic downturn, however severe, should not be used as an excuse to send American workers on a race to the bottom, where previously middle-class occupations take a sweatshop’s approach to pay and benefits.“2
Yet that is exactly what is happening, as is explicated in Naomi Klein’s The Shock Doctrine: The Rise of Disaster Capitalism.3 Whether they use the worst days of the Iraq war to hand over Iraq’s oil reserves to Shell and BP; take advantage of the Southeast Asian tsunami to auction off the beaches to tourist resorts; or “capitalize” on the tragedy of Katrina to destroy public housing and public education in New Orleans, the corporatocracy that controls this nation uses every disaster to further line its pockets at the expense of the population.
The current fiscal crisis is the biggest disaster of them all, and everywhere we look, we see the corporatocracy taking advantage of it, from the massive giveaways to the banking executives, to the pressures on working and middle-class Americans to take less and less of a piece of the pie that they have fought for and earned over and over. Have we made concessions until we are blue in the face? New hires at the Big Three are now paid slightly over $14 an hour.
Is there a silver lining? The tiniest one imaginable. The only year between 1973 and 2007 when union membership increased rather than fell was 2007, when it went up one tenth of one percent.
The ball is in our court. The vote is in our hands. This country can devote itself to the well-being of the greatest number, rather than the fewest. It can be done. It must be done. We can do it.
1 Index of Tables: Union Membership and Coverage, from Georgia State University, accessed December 23, 2008, as are the other sites in these footnotes.
2 A Race to the Bottom, by Bob Herbert, from the New York Times, December 22, 2008
3 The Shock Doctrine, from Amazon.com
Dec 21, 2008
Yes, Virginia, there is a Congressional Oversight Panel (COP) charged with trying to figure out what the Treasury Department is doing with your $700 billion bank bailout. Though they don’t have many answers at this point, they have at least come up with a few relevant Questions About the $700 Billion Emergency Economic Stabilization Funds (.pdf, 1.3Mb). This initial panel report was released on December 10, 2008. They intend to issue monthly reports and we will update this ATN item with links to those reports as they are released.
Among partial answers received from Treasury so far is a confirmation of our worst fear that Treasury has administered the program without seeking to specifically monitor the use of funds supplied to the banks, but instead relying on “general metrics” that will evaluate the overall economic effects of the disbursed funds. As the report notes, “Using general metrics could be a substitute for using no metrics at all, thus committing taxpayer resources with no meaningful oversight.”1
Here are the ten questions the panel hopes to answer in the coming months:
Dec 19, 2008
We don’t see a lot of neckties in Vermont, where we live, or New Hampshire, where we work. We guess Jim Douglas probably wears a tie—probably to bed—but he’s our governor, and he’s in that crowd we’re talking about.
We see all these guys in ties these days, strutting before cameras, taking questions, not taking questions, rationalizing away the acts that have impoverished millions, brought industries to their knees, murdered innocents: greedy guys, corrupt guys, unapologetic, unashamed, unindicted.
We see these guys in ties, and we’re tempted to hide the silver, check for our wallet, lock up our daughters. When we see the odd guy wearing a tie up here in northern New England, we think, what are you trying to get away with today? Whose pension are you going to loot, which union are you going to bust, what sick old person are you going to screw over? We just can’t see guys in ties anymore without wondering what they’re up to. No good, we’re pretty sure.
What is it about that silly sliver of senseless cloth they all wear down their fronts, like badges of mastery, like cryptic IDs in a secret society of despoilers, like a fancy shield against anyone thinking they’re just nasty little schoolyard bullies, narrowminded, grasping, and despicable.
Guys in ties.
Dec 16, 2008
The first ripples are spreading from the center of the financial debacle.
It looks like the White House will have to do an end run around its own party to bail out the auto industry,1 in hopes of saving three million jobs.2 Senate republicans have blocked a Congressional plan to provide a few billion in loans to the industry,3 a plan that even included turning the industry on its head and handing over future business decisions to a “Car Czar” to be appointed by Bush. The Republicans in the Senate wouldn’t buy it without enormous concesssions in pay and benefits from the unions, which have already done more than their part to sustain their industry.
And where is the justice or equity in seven hundred billion taxpayer dollars hastily handed over unconditionally to Wall Street following its shameful despoliation of world finance, and not one dime to bolster an admittedly flawed industry, but one upon which depends a significant percentage of working Americans?
And then there is Republic Windows and Doors.4 When Bank of America pulled the plug on the Chicago company’s line of credit, the owners told the unionized workers the 40-year-old company would close its doors in three days and, gosh, they didn’t think they had the money for the 60-day severance or accrued vacation pay the law required them to provide the workers. So the workers staged a six-day sit-in at the factory. Three-way negotiations among the union, the company, and the banks resulted in the offer of loans sufficient for the company to pay its obligations to the workers. Whether they will or not, however, since the company filed for bankruptcy on December 12, may still be in doubt. Workers are scandalously far from the front of the line of creditors in bankruptcy proceedings. Meanwhile, Republic has renamed itself Echo, moved to Iowa, and opened its factory with nonunion labor.
That the Republic workers’ sit-in to obtain rights assured them by law should be described in the Times as “risky,” “militant,” and “potentially dangerous,” speaks volumes to the skewed priorities that result in a system where capitalism is the master and not the servant of the people.
We need to get money into the pockets of regular Americans, not continue to pick those pockets for the benefit of the superwealthy. Everyone knows this, but as of last weekend, no one in Washington had done anything about it.
1 White House Ready to Aid Auto Industry, by Stephen Labaton and David M. Herszenhorn, from the New York Times, December 12, 2008 (accessed December 13, 2008)
2 Over 3 million jobs would disappear if U.S. auto-makers go bankrupt, from Economic Policy Institute, December 3, 2008 (accessed December 11, 2008)
3 Senate Abandons Automaker Bailout Bid, by David M. Herszenhorn and David E. Sanger, from the New York Times, December 11, 2008 (accessed December 13, 2008)
4 Even Workers Surprised by Success of Factory Sit-In, by Michael Luo and Karen Ann Cullotta, from the New York Times, December 12, 2008 (accessed December 13, 2008)
Oct 31, 2008
There’s a title of a book that has come into parlance now, Clash of Civilizations. There are a lot of people, I think, both in the west and in the Muslim world who believe in the clash of civilizations, who want to see the world as a place dominated by two irrevocably hostile blocks. I don’t want to live in that kind of world. I think that we live in an interconnected world full of rich, flawed, varied civilizations that are inextricably intertwined. So what I am doing in Afghanistan is working for that intertwined world.1Sarah Chayes resigned her position as a reporter for National Public Radio in 2002. She had been covering the fall of the Taliban and the post-Taliban era in Afghanistan. She decided to stay in Kandahar and has since devoted her life to helping the Afghan people find a safe, profitable, and legal route toward self-determination and self-sufficiency. Her cooperative skin-care business, Arghand, established in 2005, has begun to wean local farmers from dependence on an opium crop, and is successfully exporting its natural products to the U.S. and Canada.
Oct 24, 2008
The fiscal meltdown was a manifestation of a tendency that has increasingly infected American society, probably since the “Me Decade” of the 1970s—a growing inability to defer gratification. The masters of the universe who cooked their books during the 00’s did so in order to artificially boost their stock prices in the short run so they could claim huge performance-based bonuses. They invented impenetrable financial instruments they could quickly lay off in a deadly game of musical chairs, a Ponzi scheme they knew they were playing in a rush to claim nine-figure salaries. Their unwillingness to manage their companies with concern for anyone’s welfare—stockholders, customers, workers, or the company itself—in their mad dash for personal profit resulted in a cataclysm that has shaken the global economic system to its foundations.
Today, this unwillingness to defer gratification for the value of long-term goals is manifesting itself in one particularly unfortunate way, as noted by the Progressive Policy Institute (PPI) in their report, Short-Changing Our Future: America’s Penny-Wise, Pound-Foolish Approach to Supporting Tomorrow’s Scientists.
By now, our nation’s pitiful performance in educating a new generation of mathematicians and scientists is old news.1 We need more scientists with advanced degrees dedicating themselves to basic research; however, we are graduating fewer of them, and they are going over to industry, often with only a master’s degree, where they can make a good deal more money. Our technological future depends on basic scientific research, the kind that brought us fiber optics, the transistor, and the laser. Emerging high-tech sectors such as nanotechnology, biotechnology, and clean energy depend on basic research carried out by scientists with advanced degrees in settings that are financially secure. None of these conditions prevails today in America, largely because of our cultural affinity for the quickest route to the short-term payoff.
By the same token, dedicated postdoctoral academic researchers are paid so much less even than graduates with a master’s degree who choose to go into industry that one cannot blame the university “brain drain” entirely on the pursuit of the quick buck. The PPI’s report makes clear the urgent need we have to bolster our support of education at the high end, as we need to bolster it from preschool through college.
We cannot afford to continue luring our best and brightest to MBA degrees with starting salaries of $92,000 plus, while paying the pittance of $50,000 to postdoctoral research scientists in their mid-30s. If there is no one figuring out the ins and outs of the next generation of high technology products, all the MBAs in the world won’t be able to sell them.
1 Science and Math Education Needs an Overhaul, Say Candidates During Final Debate, by Sarah Lai Stirland, from Wired, October 15, 2008 (Accessed October 19, 2008)
Oct 03, 2008
When minerals are extracted from federally owned lands, the businesses doing the extracting are required to pay royalties to the government, that is, to us. Such royalties comprise the second largest source of revenue for the federal government, after taxes. In fiscal 2007 alone, the government collected the equivalent of over $9 billion in oil and gas royalties.
We say “the equivalent” because around ten years ago, during the Clinton administration, the oil and gas industry managed to get a royalty-in-kind (RIK) program initiated by the Department of the Interior (DOI). In some of the key source areas of RIK revenues, over half are received “in kind.”
The recent disclosures regarding drug and sex scandals at DOI1 have ripped the lid off the Minerals Management Service, the office from which the scandals emanated. In the process, the shoddy practices regarding RIK collections and audits have come to light. Millions, perhaps billions, of dollars may have been underpaid by oil and gas companies during the life of the RIK program. The records are so opaque and incomplete that we may never know what happened to the money.
This all comes as no surprise to the Project on Government Oversight (POGO), which smelled a rat associated with the RIK program years ago and, since 1995, has published five reports on it. The latest, Drilling the Taxpayer: Department of Interior’s Royality-in-Kind Program, is the first to call for the abolition of the program altogether.
[I]n light of the proposed plan to expand the program yet again, and given the numerous damning reports about the RIK program and MMS’s inability to prove that it is beneficial to the taxpayers—even ten years after its first pilot program—enough is enough. The RIK program should be terminated, and the system should revert to collecting royalties through the royalty-in-value system.Enron et al., tax cuts for the rich, Cheney’s secretive Energy Task Force, CEOs’ platinum parachutes, a collapsing financial system, and outright scandals such as the above: They all seem to point to a single-minded attempt to remove transparency and accountability from the American business sector, to the detriment of the people, the exhaustion of the people’s coffers, and the enrichment of a tiny few.
Sep 09, 2008
We read in the NYTimes this morning1 that the federal government is taking over management of Fannie Mae and Freddie Mac, replacing the boards and officers with federal functionaries. Their rationale: “Publicly, administration officials have tried to bolster the companies because the nation’s mortgage system relies on their continued ability to purchase mortgages from commercial lenders and pull the housing markets out of their slump.”
The FM/2 failures stand to cost billions of taxpayer dollars in the near future. The home mortgage mess, combined with the Iraq mess, will add trillions more to our already $9.67 trillion national debt.2 Foreclosures are up, ruining the savings and the lives of millions of Americans. And since 2003, the CEO of Freddie Mac has walked away with $38 million in compensation.
Can someone tell us why this should be? Can someone tell us why those “commercial lenders” should be allowed to make loans they have reason to believe are bad ones—indeed, to actively pursue insolvent borrowers and hornswoggle them into signing up for adjustable rate mortgages that only look good until the first adjustment puts them out on the streets—then be able to resell them to a government-guaranteed corporation where, when they go belly up, as millions have, the taxpayer picks up the loss? And expropriate—you certainly cannot characterize it as earning—millions in “compensation” while they’re doing it?
We will tell us why. Because we let them. Because we were so busy shopping and following the vicissitudes of Paris Hilton and watching television and working two jobs that we failed to notice, a few years back, that the henhouse had been turned over to the foxes. And now the henhouse is decimated,3 middle-class income has deteriorated,4 the foxes are fattening up on easy pickings,5 and we are looking around for a third job.
What will it take to wake us up, and may it not, by then, be too late?
1U.S. Rescue Seen at Hand for 2 Mortgage Giants, from the New York Times, September 6, 2008 (free registration may be required) (Accessed September 6, 2008)
2U.S. National Debt Clock, from information obtained from the U.S. Department of Treasury (Accessed September 6, 2008)
3Foreclosures in Connecticut, Nation at Record Rate, from the Hartford Courant, September 6, 2008 (Accessed September 6, 2008)
4Earning Less and Dying Younger: How the Growing Strain on America’s Middle Class Is Pummeling Our Health, from Alternet.org, September 4, 2008 (Accessed September 6, 2008)
5Exxon Shatters Record Profits, from CNNMoney.com, February 1, 2008 (Accessed September 6, 2008)
Sep 04, 2008
Do you want to know what it’s like being poor in America? It’s borrowing on the value of your next paycheck, and paying a 36 percent annual interest rate on the loan, if you’re lucky, and 500 percent and up if you’re not. It’s hocking title to your car for thirty days on the same handsome terms and losing it if you miss a payment, even if your vehicle is worth twice what you borrowed on it.
A recent study from the Consumers Union, the National Consumer Law Center, and the Consumer Federation of America lays it all out for us. They graded the 50 states on their laws regarding four “Short Term Loan Products,” which is what poor people live on from paycheck to paycheck. The states are left alone by the federal government in setting interest rates and other terms for these loans, which typically vary from $250 to $1,000.
The annual percentage rate (APR) on many of these loans is 36 percent, a cap common in state law and one recently endorsed by Congress for certain loan products extended to active-duty service members. However, many states have significantly higher APR caps or no cap at all. The Scorecard1 produced by the consortium of consumer groups gives a Pass or a Fail to four products: A two-week, $250 loan (often called a “payday” loan); a one-month, $300 auto-title loan; a six-month, $500 installment loan; and a one-year, $1,000 installment loan. If the states have a criminal usury law, the Scorecard also graded that law. The criterion used for grading these loans was whether the APR caps were 36 percent or below (Pass) or above 36 percent (Fail).
I live in Vermont and work in New Hampshire, so those two states were of particular interest to me. Vermont receives a passing grade in all five areas; it prohibits the first two types of loans and caps interest on the installment loans at 24 percent. New Hampshire, the “Live Free or Die” state, is a different matter. They fail all four loan categories, which have no APR caps at all, and were not graded on their criminal usury law because they don’t have one. This is arguably better than Missouri, where the cap on a $250 payday loan is 1,955 percent.
The “Show Me” State? They should call it the “Screw Me” State.
Find out at the link below the extent to which your state punishes the poor for being broke.
1The Scorecard (.pdf). (Accessed August 30, 2008)
Aug 23, 2008
As readers are already aware in the short time All Together Now has been online, we are not a fan of privatization. (See Water, Incorporated and Interstate, Inc.) So we were not happy to run across an outfit called the Reason Foundation and its “Annual Privatization Report 2008.”
However, having plumbed about half its 120-page depth so far, a few observations and a somewhat modified stance are called for:
Aug 14, 2008
Since the days of Enron and the other corporate debacles that rang in the beginning of the new millennium, a huge industry has grown up that purports to provide independent judgments on the quality of corporate governance. The industry is dominated by four firms, the best known being Institutional Shareholder Services (ISS). It was sold in 2001 for a reported $45 million.
By tweaking numbers available through SEC filings and other public sources, these companies come up with ratings that they claim can predict future performance of the companies. Problem is, they don’t. In a recent study by the Stanford Graduate School of Business entitled, “Rating the Ratings: How Good Are Commercial Governance Ratings?,” the authors conclude that they aren’t very good at all. The study looked for correlations among the ratings of four leading watchdog companies and five basic performance metrics: restatement of financial results, shareholder lawsuits, return on assets, and some things called the Q Ratio and Alpha which only someone who spends 24/7 wringing money out of the stock market can understand. They found slight to no correlation among the elements, and practically no agreement among the leading companies’ ratings (many of the same corporations were rated by more than one watchdog).
So why then did a company that sold for $45 million in 2001 manage to get itself sold again in 2006 for over half a billion dollars, despite the fact that its product is, well, worthless? I guess it just proves that, even in the heady regions of high finance, there’s one—or two—born every minute.
Aug 11, 2008
We’ve previously noted the ill effects that can arise from letting the private sector intrude on the public infrastructure that delivers and treats our water (see Water, Incorporated). Now comes this Congressional Research Service (CRS) report (RL34567) on “Public-Private Partnerships in Highway and Transit Infrastructure Provision.”
We are moving into Phase II of all those tax cuts we’ve been seeing over the course of the last several administrations. We see now it was all for the purpose of starving government to the point it had to consider introducing the profit motive into areas where the profit motive is inappropriate. Business is a wonderful thing in its place. In a free market where competition is assured, where transactions may occur—or not—between a willing buyer and a willing seller, businesses must be lean and quick, grabbing at opportunities that present themselves and dropping hot potatoes with dispatch. The rough-and-tumble of markets, of buying and selling, of profit and loss, of growth and decline, have no place in the public sector, where products and services essential to a stable social infrastructure must be delivered equally to all, without regard to considerations of supply and demand.
The private sector has one responsibility to its constituents, who are its owner/shareholders and not the public, and that is the maximization of profit before and beyond any other consideration. And that is as it should be. And that is why the private sector must be kept out of the public sector. And that is why only a single-payer, public health care system will ever work—perhaps not as well as we might want it to in our ideal imagination—but far better than it ever could if kept within the private sector, and far, far better than it does now.
And that goes for our roads, our tunnels, our bridges, and our entire transportation infrastructure. Where we have privatized it—in the railroads, in the airways, and in the airwaves—it’s a mess, with no consideration but that of delivering a minimal product at a maximum profit.
Jul 06, 2008
Formula for making a lot of money: Get elected to a position of public responsibility, and collude with your fellow elected officials to neglect your responsibility until the disasters begin to mount, meanwhile investing in the private companies which will ultimately clean up your mess to their own—and your—very tidy profit.
Some services belong in the public sector, and none more so than the provision of clean water and wastewater disposal. That provision is threatened, however, as our aging and neglected national infrastructure deteriorates and industry pushes in to take over the costly task of restoring it. It is estimated we will have to spend up to $1 trillion between 2002 and 2019 to upgrade and repair 1.5 million miles of piping and treatment plants.1
In a report by the Food & Water Watch, a nonprofit consumer organization that works to ensure clean water and food, entitled “Costly Returns,” the group warns that “corporate advocates are deceitfully using the costliness of those [infrastructure] upgrades as ammunition to push elected officials into privatizing their water and sewer systems.” Many of those elected officials don't need much pushing, since they believe everything from Social Security to our armed forces should be privatized, the better to enrich themselves and their cronies.
The report shows in stark terms how undercutting the public good in the management of water services enhances corporate profits at the expense of the environment and the consumer. When the profit motive is substituted for the public good—whether in schools, prisons, libraries, or the delivery of essential public services—you can bet the public good is going to suffer. Profit and public services are incompatible and when they are brought together, the services will suffer for the benefit of the profits. We have seen it happen time and again; the present report documents several instances where large municipalities have rued the day they turned their water management over to the private sector, and have cancelled their contracts.
Our water is one of our collective responsibilities, and the public sector exists to fulfill those responsibilities, notwithstanding the cupidity of many of our current elected officials.
And if you can't drink to that, look for many a dry season ahead.
1 “Future Investment in Drinking Water and Wastewater Infrastructure.” Congressional Budget Office, Washington, D.C., November 2002, p.8.
Copyright © 2008 All Together Now.