The nightmare of CA's prison system

http://www.npr.org/templates/story/story.php?storyId=111843426

A must-read/hear, and I don't say that much.

Those of us who have the misfortune of living in dysfunctional CA already know some of this, but it's really sick how the prison guard's union has really capitalized on human misery to gain money, numbers, and power. The people claiming to hold the line between the dangerous criminals and the vulnerably citizenry are the ones making the crime problem worse. Like the pharma-medical industries, they partially exist to help people, but mainly exist to help themselves. Currently 10% of state corrections employees make six figures. There's more money in treatments than cures. Repeatedly locking up people instead of educating and rehabilitating them may increase the prison guards' job security, but it bankrupts the state and makes our streets actually less safe.

And then there were the grandstanding GOP politicians like ex-governor Pete Wilson seeking to "get tough on crime". Yes the crack epidemic promoted terrible gang problems and violence in urban centers. Something had to be done, but instead of increasing drug treatment and education programs, they just made sentencing tougher. People who show a total disrespect for the law and public safety should be punished accordingly, but a nonviolent pot smoker doesn't pose the same criminal threat as Pablo Escobar. Wilson and company wanted to make California's streets safe for Joe Blow suburbanite consumer, so of course that meant locking up Jose and Mookie of the underclasses (and in dozens of cases, giving them lethal injection too). And middle-to-upper class CA supported it. What kind of society is that where we incarcerate people we don't feel comfortable with? And it's not like those same suburbanites weren't snorting blow, hiring illegal immigrant nannies, or cheating on their taxes either.

Out of sight, out of mind. Using a marketing campaign of extreme examples of extreme criminality, con men like Wilson and Reagan (remember the Willie Horton ad?) scared us silly, to the point where we would gladly cancel indeterminate sentencing in favor of mandatory (so forget the hope of early release for good behavior), and imprison someone for their entire life for stealing a TV three times, or being in the same car while a kidnapping was taking place. Missing one parole meeting would send you back to the slammer. Since Wilson's time, CA's prison population rose from 20,000 to 167,000. Yet the number of violent, maximum security convicts has remained relatively stable. The difference is the "petty offenders", who only get nastier in the racist, inhumane confines of prison instead of rehabilitated. And some depraved prison guards even derive entertainment from that tragedy. CA has set inmates up for failure, and the 75% recidivism rate proves it. Despite all these extra people locked away, CA is not really a safer place now than 1980. Some cities even suggest the contrary. Overall US crime and CA crime did drop a lot in the 1990s, but rates have rebounded in this decade. Yet the prison population has only risen steadily, so there isn't a correlation. Those politicians, prison guard's union, and apathetic, intolerant suburban voters (yes that's us), have hurt the state far worse than a million Crips ever could.

Well our bigotry and overzeal of the past have now come home to roost. Apart from the obvious challenges to our budget ($10B a year to keep the "prison industrial complex" running, on par with our entire "bloated" education budget), we have to live with the moral stain that Californians chose the path of apartheid - and I don't say that lightly. Conditions in our prisons are so horrible that we are probably in violation of the Constitution, and I'm not even talking about the assaults, rapes, and riots. Inadequate health care causes hundreds to die each year of treatable conditions, and the court-appointed receiver for prison health reform believes we would need to spend at least $2.5B in construction and $0.48B annually just to provide the legal minimum service. We've created a monster who is eating us out of house and home. The prisoners are not the monsters; it's the system and those who gain from its existence.

http://www.lao.ca.gov/2007/cj_primer/cj_primer_013107.aspx
http://www.facts1.com/general/Casey.htm

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Folsom Embodies California's Prison Blues

by Laura Sullivan


August 13, 2009

In January 1968, Johnny Cash set up his band on a makeshift stage in the cafeteria at Folsom State Prison in California.

"Hello, I'm Johnny Cash," he said in his deep baritone to thunderous applause. Song after song, the inmates thumped their fists and cheered from the same steel benches now bolted to the floor.

The morning that Cash played may have been the high-water mark for Folsom — and for the California Department of Corrections and Rehabilitation.

The men in the cafeteria lived alone in their own prison cells. Almost every one of them was in school or learning a professional trade. The cost of housing them barely registered on the state budget. And when these men walked out of Folsom free, the majority of them never returned to prison.

It was a record no other state could match.

Things have changed. California's prisons are all in a state of crisis. And nowhere is this more visible than at Folsom today.

Overcrowded, Underfunded
A Look at Folsom Prison

Credit: Amy Walters and Laura Sullivan/NPR

Folsom was built to hold 1,800 inmates. It now houses 4,427.

It's once-vaunted education and work programs have been cut to just a few classes, with waiting lists more than 1,000 inmates long.

Officers are on furlough. Its medical facility is under federal receivership. And like every other prison in the state, 75 percent of the inmates who are released from Folsom today will be back behind bars within three years.

California's prison system costs $10 billion a year. Its crumbling, overcrowded facilities are home to the highest recidivism rate in the country. And the state that was once was the national model in corrections has become the model every state is now trying to avoid.

'Kind Of Like A Pressure Cooker'

Lt. Anthony Gentile, spokesman for Folsom, stands in the prison's empty cafeteria, beneath chipping paint, rusting pipes and razor wire.

"There's drug activity, gang activity," Gentile says. "It's kind of like a pressure cooker."

Where a photographer stood 40 years ago and captured Cash's famous concert, an officer now stands in a metal cage. He's armed with three guns and pepper spray.

When they're confined in this environment, the problems tend to simmer and stay there. It creates somewhat of the mob mentality.

- Lt. Anthony Gentile, spokesman for Folsom

There are now 15 to 20 assaults a week here at Folsom. And while inmates used to mix with one another, Folsom today is entirely segregated by race — in the cafeteria, on the yard and in the cell blocks.

"When they're confined in this environment," Gentile says, "the problems tend to simmer and stay there. It creates somewhat of the mob mentality."

To figure out how California could have gotten to such a place, you have to start in Sacramento.

Jeanne Woodford is one of four secretaries that the Department of Corrections and Rehabilitation has had in the past five years. She spent 30 years in the department. As secretary, she lasted two months.

"Honestly, I was very hopeful when I went up there," Woodford said about Sacramento. "I thought it was all about the right policy and the right principle. It's really about the money."

And lots of it. California can't afford its prisons. Taxpayers spend as much money locking people up as they do on the state's entire education system.

How Did Things Get So Bad?

Experts agree that the problem started when Californians voted for a series of get-tough-on-crime laws in the 1980s. The state's prison population exploded immediately. It jumped from 20,000 inmates, where it had held steady throughout the 1960s, 1970s and early 1980s. Today there are 167,000 inmates in the system.

Jeanne Woodford was warden of San Quentin during the prison population boom.

"The violence just went out of control," she remembers. "And then the programs started going away. I was there during an 18-month lockdown. It was just unbelievably horrific."

California wasn't the only state to toughen laws in the throes of the 1980s crack wars. But Californians took it to a new level.

Voters increased parole sanctions and gave prison time to nonviolent drug offenders. They eliminated indeterminate sentencing, removing any leeway to let inmates out early for good behavior. Then came the "Three Strikes You're Out" law in 1994. Offenders who had committed even a minor third felony — like shoplifting — got life sentences.
Derrick Poole is enrolled in Folsom's mill and cabinetry program.
Enlarge Laura Sullivan/NPR

Derrick Poole is enrolled in Folsom's mill and cabinetry program. Due to the high prison population and budget problems, Poole is one of only 10 percent of Folsom inmates who can participate in the prison's vocational programs.

Voters at the time were inundated with television ads, pamphlets and press conferences from Gov. Pete Wilson. "Three strikes is the most important victory yet in the fight to take back our streets," Wilson told crowds.

But behind these efforts to get voters to approve these laws was one major player: the correctional officers union.

A Prison Guard Union With Political Muscle

In three decades, the California Correctional Peace Officers Association has become one of the most powerful political forces in California. The union has contributed millions of dollars to support "three strikes" and other laws that lengthen sentences and increase parole sanctions. It donated $1 million to Wilson after he backed the three strikes law.

And the result for the union has been dramatic. Since the laws went into effect and the inmate population boomed, the union grew from 2,600 officers to 45,000 officers. Salaries jumped: In 1980, the average officer earned $15,000 a year; today, one in every 10 officers makes more than $100,000 a year.

Lance Corcoran, spokesman for the union, says it does what is best for its members.

"We have advocated successfully for our members," he said.

But he disputes that the union has purposefully tried to increase the prison population.

"The notion that we are some prison industrial complex, or that we are recruiting felons or trying to change laws, is a misnomer," he said.

Money And Influence

I think that prisons should be a place where an individual has the opportunity to change if they choose to and we move forward from there.

- Fulsom Warden Michael Evans

Campaign records, however, show much of the funding to promote and push for the passage of the laws came from a political action committee the union created. It is run out of a group called Crime Victims United of California.

Its director, Harriet Salarno, says the committee is independent from the union. But a review of the PAC's financial records shows the PAC has not received a donation from another group besides the union since 2004.

Corcoran does not deny that the two are closely connected.

"We support a number of victims' rights groups," he said.

When asked why the correctional officers union is involved in victims' rights at all, Corcoran said: "There are people that think that there's some sort of ulterior motive, but the reality is we simply want to make sure [the victims'] voices are heard."

But Corcoran acknowledges that the union has benefited from the increase in the prison population after these laws passed.

"We've had the opportunity to grow," Corcoran says, "and that has brought with it both success and criticism."

Secret Dealings With The Governor

Woodford says she stepped down as secretary of the corrections department when she found out that the union had been going on behind her back to negotiate directly with the governor's office.

"The union is incredibly powerful," Woodford says.

Former Secretary Roderick Hickman resigned for the same reason in February 2006.

"The biggest problem that I had was the relationship that I had with the union," Hickman says.

Hickman says the union was able to control the department's policy decisions, including undermining efforts to divert offenders from prison and reduce the prison population.

"Maybe I was just impatient," he says, "or it wasn't going to go fast enough, but [the department] is still in the same place I left it, with an over $8 billion budget. Now it's over $10 billion."

Today, 70 percent of that budget goes to pay salaries and benefits to the union and staff. Just 5 percent of the budget goes to education and vocational programs — the kind of programs that study after study in the past 10 years has found will keep inmates from returning to prison.

Shop Talk: A Chance To Cross Race Lines

From the instant you walk through the metal doors of the mill and cabinetry workshop at Folsom, you get a different feeling from other parts of the prison. In the shop on a recent day, a group of black, white and Latino inmates are bent over a table, talking to each other, discussing measurements for a conference table.

"When we're down here, we put all the politics to the side," says inmate Derrick Poole as he works on the table's legs. "It gives us a place to go where we can we can get out of the prison politics gang, where we don't get along, where we don't socialize outside our race. We socialize outside our race here."

Poole is spending nine years at Folsom for drug possession with intent to sell. In his life, he has been released from prison at least six times that he can remember. It hasn't worked out well.

"When I got out, you kind of lose your social skills," Poole said. "You get used to segregating yourself. You already weren't learned on the street. Then you come in here and you're not learning, and now your mind is more hollow, more empty."

Poole got very lucky this time, beating out hundreds of others to land a spot among just 27 inmates in the cabinetry program. When he's done, Poole will be an accredited woodworker with his GED.

Most of the men in Folsom won't be so fortunate. Just across from the cabinetry shop, program administrator and school Principal Jean Bracy sits in her makeshift office next to the welding class. She knows the statistics by heart.

"I have 1,797 inmates who read below the 9th grade level; 394 of those read below the 4th grade level," Bracy says. "When we put them back out on the streets, they're not employable."

And back on the streets is where 85 percent of all California's inmates are going one day when their sentences run out, regardless of whether they spent their time in prison dealing drugs and running a gang or learning how to weld.

Bracy only has a handful of vocational programs left, enough to reach less than 10 percent of Folsom's inmates — and the state plans to cut even that in half in the next few weeks.

"I think this is the worst I've ever seen it," Bracy says.

'A Merry-Go-Round'

It only costs her about $100,000 to run these programs — not even a blip in a $10 billion-a-year prison budget. But, says Bracy, the programs are always the first to go. Sometimes she almost feels like giving up.

"It's just not cost-effective to throw men and women in prison and then do nothing with them," she said. "And shame on us for thinking that's safety. It's not public safety. You lock them up and do nothing with them. They go out not even equal to what they came in but worse."

The numbers bear that out, with 90,000 inmates returning to California's prisons every year.

But compare that to the Braille program here at Folsom. Inmates are learning to translate books for the blind. In 20 years, not a single inmate who has been part of the program has ever returned to prison. This year, the program has been cut back to 19 inmates.

Out on the prison yard, one of the oldtimers, an inmate named Ed Steward — or "Lefty" — sits in old chair in the only bit of shade on the dusty dirt field. He watches the inmates stand in groups by their race and shakes his head.

"Nowadays, you know, the kids are just coming through this like it's a merry-go-round," he said. "Like there's nothing to it."

Most of these inmates here on this yard aren't here for serious or violent crimes. The number of inmates incarcerated in California's prisons for murder, assault or rape has been relatively unchanged in two decades. The difference is this yard is now packed with drug dealers and drug users, car thieves and shoplifters who stole something worth more than $500.

What Used To Be

But all across this prison are signs of what this place once was — when administrators came from New York and Texas to find out how Folsom kept its violence so low and its inmates from coming back.

There's the deserted shop where inmates used to train to be butchers; it was closed when the prison couldn't afford to remove the asbestos.

Its thriving medical facility was shuttered when it couldn't keep up with thousands of new inmates.

And hovering above the prison is China Hill, a now-barren field where inmates once trained to become landscapers. The prison can't afford to pay the teacher.

Warden Michael Evans can see China Hill just outside his office. Its meaning is not lost on him.

"If I have a dog and I put him in a cage and I beat [him] regularly, ultimately [it] will bite me when I open that door," he said.

After three decades working in corrections, Evans says he has come to one conclusion.

"I think that prisons should be a place where an individual has the opportunity to change if they choose to," he said, "and we move forward from there."

For now, California is at a standstill, unable to find the money to move forward with a different strategy, unable to move backward to a time when it didn't need one.

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In addition to being rife with typos and grammatical errors this article is disheartening from a topical perspective as well... There's a reason why it's possible to hear of a prison colloquially referred to as "Crime University" and it's a shame that we continue to push in the same direction with respect to criminal justice rather than stopping to consider whether an alternative approach might be feasible (e.g. Vipassana)...

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the three strikes prgrm works fine, it is the overwhelming number of prisoners in the jail system that is the problem which is the obvious problem...we simply need to reintroduce the death penalty to separate the "strikers" from the true "strikers" - i watched a documentary that showed an overwhelming ratio of inmate to guard in the prison system in the california system - it was something like 15 to 1 that is what they are dealing with...fights, riots, etc are occuring on a daily basis and this will continue to happen with our economy as it is - the prison system is a low priority - obama does not have that on the top of his list...

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What are we going to do? Kill people for possession of pot? Stealing a bike? There are a number of 3 strikers in jail along with drug possession criminals filling the cells in CA. My suggestions?
1. the state needs to take ownership of the prison system. They're privatized at this point and full beds means more income for these investors. Who's one of the biggest investors in the private CA prison system? Bar Bush. The private prisons get 50K per inmate per year. Hell, what if we gave these people 35K a year to live on their own? Oh, I'm sorry that would be welfare, giving people money for nothing. What's prison? Maybe we should do like they did in a prison in Tennesee? They were starving the inmates so the management could pocket the extra money.
2. legalize drugs, let all people out of jail immediately that are there for drug arrests, period.
3. Assess risk to the population based upon violence and keep those that are violent out of the general population. Unfortunately, soon all of them will be dangerous to the general population b/c they're being tortured in jail. They use sleep deprivation, bright lights and isolation in these systems. I know someone who'd been there and saw it firsthand.
4. Lock up the real violent criminals-Rumsfeld, Cheney, John Yoo, Alberto Gonzalez and Karl Rove. Let them share a 6X10 cell with a toilet in the corner.

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Some of what you proposed may happen anyway, due to economic forces. Because of prison overcrowding, they are releasing hundreds, if not thousands, of elderly or minor-offense convicts early. Drug legalization always seems to be on the table (at the back of the table), but now with CA's deficit it seems like a reasonable price to pay for the extra revenue. Amsterdam did not deteriorate into Gomorrah, and it is much better than most, if not all, US cities.

If the prison guards treated the inmates better and tried to forge a respectful relationship, then there would be less violence. In other prisons around the world (maybe not in the US, but definitely in the past), guards don't even carry weapons. There is no lock down and solitary confinement. If you want people to treat you right, start by treating them right. And for how much we want to forget, inmates are still human beings.

I do not know how many of our life-sentence inmates are there for Three Strikes, but it is not an effective program. As I said, overall US and CA crime did drop precipitously in the 1990s. But that would have happened with or without Three Strikes. If you've read Freakanomics, the author has a very controversial theory on the reason behind US crime reduction (he cites the legalization of abortion in the 1960s putting fewer poor, desperate, crime-prone people on the streets by the 1990s, but also increases in law enforcement budget/personnel, reduced crack use, and prosperous economic conditions). We have to use data and predictions to estimate how much worse crime would have been without Three Strikes. Since it's installment of 1994, a GWU study charted its enforcement county-by-county. Since different CA counties enforced Three Strikes more or less strictly, if the program worked, you would expect crime rates to have decreased the most in counties where the enforcement was strictest. But there was no correlation, despite Sacramento's assurances that the program "drastically" reduced crime. So we're spending a lot of extra money and ruining more lives for very little social benefit.

The punishment is not proportional. Yes it's terrible if you are convicted for a felony three times in your life, but it does not warrant losing your freedom forever. Violent crime is another matter, and usually the sentencing for those offenses become de facto life terms anyway. Actually reading up on Three Strikes, it seems that the first two strikes have to be "serious" felonies, and the third can be any felony (auto theft, burglary, property theft >$500, even if no one is hurt). The second strike mandates 2X length of normal sentencing, and the third strike you are in prison for 25 to life. Good behavior rewards are reduced from 50 to 20% of sentence. And even for non-violent, non-escape-risk inmates, they are not permitted to serve their time in county jails, probation, or house arrest (as they used to do in the past) - further bloating the prison population. I was not in the state at the time, but in 2004 there was a Proposition 66 that would have toned down Three Strikes at a savings of several hundred million dollars per year to the state. It was narrowly voted down (53% to 47%), so that shows nearly as many Californians disapprove of Three Strikes as approve.

http://www.lao.ca.gov/2005/3_Strikes/3_strikes_102005.htm
http://www.rand.org/pubs/research_briefs/RB4009/index1.html

Or maybe the better solution is prevention. As L said, why spend $50k per prisoner when you can spend a fraction of that on social programs and urban outreach? Attack the seeds of crime before they grow. Poverty and low education are heavily correlated with criminality. But again, that would reduce job security for cops and prison guards, so no-go. They would rather spend millions on GPS parolee tracking, Tazers, Kevlar, assault rifles, and faster cars. You can't get rid of 100% of crime, but the whole point is getting the most bang for your buck, and hopefully doing it humanely. Yeah the private prisons idea is terrible. Just another way to fleece the gov't, like defense contracts. But it's the gov'ts fault too for shirking their responsibility on this serious issue, and passing it off to the for-profit "private sector" that is supposedly more efficient.

Sotomayor confirmation

http://www.washingtonpost.com/wp-dyn/content/article/2009/08/04/AR2009080401691.html?wprss=rss_nation
http://www.azcentral.com/news/articles/2009/05/24/20090524obama-court0524.html

"Latinos see [Sotomayor] as a symbol of Hispanic leadership in America," said Lionel Sosa, a Latino political strategist who has advised several presidential candidates on Hispanic outreach, including McCain. "If they vote against Sotomayor, it's a vote against Hispanic leadership in America. That's the way Latino voters will see it."

Well if they see it that way, then they are idiots.

It's not good for the country if symbolism and identity take too prominent a role in politics. Just because you oppose a public official doesn't mean you oppose their entire ethnic group's involvement in politics. It's like how AIPAC and other groups blanketly label any Israel critics as anti-Semitic. That is a sad reflection on our country and our political culture if some Latino-American politicians and activists threaten to punish any GOP "no" votes during the next election cycle. What does that say about their community if they feel the need to bully and blackmail opponents into agreement? The NRA and right-wing radio are doing the same thing for any Republicans who confirm Sotomayor, so what are they to do? I hope the Latino-American political machine doesn't want to lower itself to the level of the NRA and Limbaugh. I know it's not like they're in the streets with torches and pitchforks, but still I would hope for more restraint. If Sotomayor truly is the most worthy nominee in the eyes of the Latino community (and I doubt many even bothered to read up on her beyond the sound bites, or share much in common with her beyond speaking Spanish), then they should trust that the public, media, and Senate will come to the same conclusion. And if some don't, well you can't please everyone. Let the political process, which they seek greater visibility in, work.

Sotomayor probably well exceeds qualifications for the job. But it's not like she is the overwhelming obvious choice. Other names floating around were Kagan, Wood, Granholm, Wardlaw, and Napolitano (all white women), and their records are similarly impressive. Obama is playing politics too, and it would be a great boost to the Democrats for them to take credit for her historic nomination, considering that Latino swing votes may become more influential in future elections. It shouldn't be so consequential, but that is reality. And there's no need to play affirmate action with our High Court. Yes it would be nice if the Nine represent their country's demographics and were also the top judicators in the land, but it's not like we need quotas for various minorities. We are supposed to pick the most qualified, blindly. At least Sotomayor knocks off two categories: female and Latina. But if America worries about quotas and representation, then why nominate another Catholic when 5 of 8 justices are already Catholics?

After all, she will surely be confirmed despite 28 or so GOP nays. So what is the point of all their fussing? Maybe it's just media overexposure, but still this should really be a non-issue. I guess they wanted to hit a home run with nay votes in the teens or fewer, to send a positive message for Obama and the Latino community. And to put things in perspective, she is but one vote out of nine, and not even a swing vote. The court still leans conservative. Probably LA Mayor Villeraigosa is a more influential Latino leader, and he was elected directly by the people, unlike the undemocratic Senate-decided life term of a justice. Latino-Americans vote majority Democrat, so I don't remember them threatening Democrat senators over no-votes for Alberto Gonzales' nomination by Bush to AG a few years ago. He was a "historic" first Latino to that position too. Lastly, I don't recall the black community threatening the opposition party for refusing to support Thurgood Marshall, Eric Holder, or even Barack Obama - all three being the first African-Americans to their respective positions. I guess the GOP figured it was a moot point, since blacks vote over 90% Democrat anyway (even if the candidate isn't black), so very few additional votes to lose. But maybe it matters more with Latinos, who are projected to occupy a much larger slice of the American population in the coming decades vs. other minorities.

Pro-Sotomayor Republicans say that they are disappointed with their party for placing ideology concerns over professional qualifications over the Sotomayor confirmation. Well unfortunately for a Supreme Court nominee, ideology is part of your qualifications. Maybe that is true for most jobs in Washington (remember the attorney firings during the Bush years?). But probably they have little to worry about, since Sotomayor was rumored to be under consideration by right-winger Bush for the Supreme Court opening that Alito eventually took. Liberals would do the same thing against nominees who may want to overturn Roe-v-Wade, prohibit gay marriage, or other sensitive liberal issues. Of course nominees are smart enough to keep mum about their personal views during the long-winded confirmation hearings, and will come up with all sorts of confusing excuses to explain their past controversial comments, because they want the job so badly - and I guess we all do the same at job interviews.

I only have one thing to add about the "wise Latina" comments. She can say whatever she wants as a private citizen off duty, and that has nothing to do with her professional performance. But anyone who declares herself as "wise" demonstrates the contrary. The truly wise don't have to announce it to anyone, and Pascal said, "Do you wish people to think well of you? Don't speak well of yourself. " Gandhi followed with, "It is unwise to be too sure of one's own wisdom. It is healthy to be reminded that the strongest might weaken and the wisest might err." That comes from two of the wisest humans in history. She wasn't wise enough to maintain her marriage, and has no children (and nothing edifies a person like having kids). So by missing out on those "life experiences", can she empathize as well as the other justices with families? She's very bright and a geek of the law. She's wise in the courtroom, but probably not on the streets. That's no better or worse than the other justices, so she and the public should stop trying to claim that she's something more. I don't mean to be so harsh on her, but suffering through her boooooring confirmation hearings on NPR for a week made me bitter! I think Sir Oscar Wilde summed up the Senate confirmation hearings process well ahead of his time: "In examinations, the foolish ask questions the wise cannot answer.”

She says that her background will help her empathize and understand more cases/people than a white male justice. But Sotomayor does not think, act, and live like a typical Latino-American now and for many years. She is rich and powerful, and actually lives more like an upper class white. Although much "poorer" than recent millionaire nominees Roberts and Alito, her net worth is over $770k plus full judge salary pension after she turns 65, according to NYT. The Pew Hispanic Center cited the median net worth of Latino American households at $7,900 in 2002, and I doubt it's much better now. So how much does she have in common with people who are 100X poorer? I am sure she is well versed in Latino issues from books and colleagues, but it has been decades since she was a poor Puerto Rican from the Bronx. It's just like the Obamas - what kind of personal/social connection do they have with the African Americans in Oakland or Alabama? Yet those communities love and embrace them as if they are a product of their neighborhood. I guess that is the "cult of personality". We love and vote for people who we identify with (in our minds at least), which is sadly no better than the fragmented Afghans and sectarian Iraqis.

Problems with our Afghanistan approach

http://www.lrb.co.uk/v31/n13/stew01_.html

I found these 3 quotes from the author to be most telling:

-Counter-insurgency is neither a necessary nor a sufficient condition for state-building.
-Americans are particularly unwilling to believe that problems are insoluble.
-The new UK strategy for Afghanistan is... not a plan; it is a description of what we have not got.

From Rory Stewart, Kennedy School of Government, Afghanistan expert. NATO may find it a lot harder to achieve Iraq-level "success" in Afghanistan (how disheartening is that?). A troop surge may buy time for government to fill the Taleban void, reconcile the hostile groups, and improve the rule of law/human services, except that this is the Afghan government we're talking about - completely incapable of doing any of that. It's not necessarily their fault, since Afghanistan is one of the 10 poorest nations on Earth, very remote/harsh, with a very under-educated populace, and recovering from decades of war and social turmoil. In addition, there are no marginalized, deal-making Sunnis to "awaken" to our side, and Afghanistan is geographically larger than Iraq yet we've devoted 38% fewer troops: 146,000 for Iraq vs. 90,000 for Afghanistan (that is including the less motivated, experienced, risk-taking non-US forces, as well as the upper estimate of Obama's 2009 surge request). But of course military models recommend a force of at least 500,000 to properly stabilize a nation like Afghanistan. That is impossible, and so is this: the Pentagon seeks to train and deploy a combined Afghan security force of approx. 450,000 men to take over as we draw down (assuming Surge part 2 succeeds). But supporting such a force would require 500% of Afghanistan's current budget (narco-commerce not included).

This is what Obama recently said of the Afghanistan challenge:

[The Afghan gov't] is undermined by corruption and has difficulty delivering basic services to its people. The economy is undercut by a booming narcotics trade that encourages criminality and funds the insurgency . . . If the Afghan government falls to the Taliban – or allows al-Qaida to go unchallenged – that country will again be a base for terrorists who want to kill as many of our people as they possibly can . . . For the Afghan people, a return to Taliban rule would condemn their country to brutal governance, international isolation, a paralysed economy, and the denial of basic human rights to the Afghan people – especially women and girls. The return in force of al-Qaida terrorists who would accompany the core Taliban leadership would cast Afghanistan under the shadow of perpetual violence.

‘There can be only one winner: democracy and a strong Afghan state,’ Gordon Brown predicted in his most recent speech on the subject.

Well that leaves very little room for error, doesn't it? Isn't this the same problem Bush/Blair had justifying/selling the Iraq quagmire? I guess Democrats can do fear-mongering too, like LBJ in Vietnam. Just as it was ludicrous to fear that Saddam would equip terrorists with WMD to strike America, it's unrealistic to think that Western inaction will lead to Taleban/Qaeda takeover of 2 failed states and Pakistan's nuclear arsenal. And it's not a foregone conclusion that those 2 groups will even be able to cooperate in the future, as they have poor track records and clearly different objectives.

And Stewart continues: It misleads us in several respects simultaneously: minimising differences between cultures, exaggerating our fears, aggrandising our ambitions, inflating a sense of moral obligations and power, and confusing our goals. All these attitudes are aspects of a single worldview and create an almost irresistible illusion. It conjures nightmares of ‘failed states’ and ‘global extremism’, offers the remedies of ‘state-building’ and ‘counter-insurgency’, and promises a final dream of ‘legitimate, accountable governance’. The path is broad ... general ... and almost too abstract to be defined or refuted. It papers over the weakness of the international community: our lack of knowledge, power and legitimacy. It conceals the conflicts between our interests: between giving aid to Afghans and killing terrorists. It assumes that Afghanistan is predictable. It makes our policy seem a moral obligation, makes failure unacceptable, and alternatives inconceivable. It does this so well that a more moderate, minimalist approach becomes almost impossible to articulate.

Sounds like a blast from the past. New administration but same ignorance, hubris, and vague/misplaced goals. Yes it's true that the stakes are great and Afghanistan is a critical foreign policy priority, but framing the discussion in this manner is not helpful or responsible. In other words, we can't approach Afghanistan as a test of wills or a holy war. That is how our opponents think (or so some say), and that is what they want from us. Yet strangely everyone and their mother are on board for Obama's plan (the UN, aid groups, NATO, our Muslim allies, and even Afghans). It's just because they hate/fear the oppressive Taleban so much, and are terribly war-weary and desperate. We all hope that an increase in troops will magically fix Afghanistan, but we have to remember history and consider the objective data.

Stewart suggests a sleeker approach with less of a Western footprint on Afghanistan. Nation-building must be an Afghan-driven process, and nothing that we implement will work well or last. Our special forces operations to cripple Qaeda have been effective since 2001, so let's continue that instead of clogging the battlefield and Afghan communities with our regular troops that weren't built or trained for this delicate, difficult purpose. Careful air strikes and 20,000 special forces are enough for surgical missions that will place fewer civilians at risk. If we truly want to increase the rule of law, government functionality, and development over there, then we should stop pretending and actually seriously fund/equip those projects to the level that is required. So we need more boots on the ground for sure, just not boots toting rifles.

Cash for clunkers

http://www.cars.gov/
http://www.kbb.com/kbb/cash-for-clunkers/list.aspx
http://www.npr.org/templates/story/story.php?storyId=111456626&ft=1&f=1006

I question the necessity and execution of this program. Yes it appears to be a success when the $1B CARS fund has nearly depleted after a week of enrollment, and the House quickly passed another $2B replenishment. Assuming that the average rebate is $4,000, that means 250,000 new car sales were subsidized by CARS (assuming no overhead and clunker junking costs). But what is the purpose of the program? A) to get surplus new vehicles off dealer lots, B) to make America's auto fleet less polluting, and/or C) to help consumers fight the recession with increased spending and enjoy the quality-of-life benefits of a new car? And shouldn't this program accomplish those goals fairly and efficiently?

Well let's look at goal A. If Uncle Sam wanted to incentivize Americans to buy more cars (and more fuel-efficient cars... tie-in to goal B), why not just give a tax rebate for buying high-MPG vehicles? Hybrids already have a tax credit, and under the Bush admin. they even gave polluting mega-trucks and SUVs up to a $12k tax break if the vehicle was used for a small business (an easily abused condition). Efficient vehicles are already cheaper than gas-guzzlers, and it's easier to get a great deal for a new car these days, but maybe another $1-2k off the sticker price would help consumers do the right thing. Because if the Feds are essentially rewarding consumers for making poor decisions in the past, that is no different than the bank and mortgage bailouts to irresponsible lenders/borrowers.

So for goal B - will this program make America's auto fleet a bit less polluting? Hard to say but doubtful. There are over 140M autos in the US (1 car for ever 2.5 people, so even if CARS facilitates 500k trade-ins, that will raise our overall fleet MPG under 0.1%). To qualify for the program, clunkers must achieve 10 MPG (or 4 MPG for "work trucks") according to Kelly Blue Book. And to get a full rebate, you must buy a new car that is 10 MPG more efficient. So if I trade in a guzzler 9 MPG Suburban, that means I can buy another medium-sized SUV that gets 19 MPG, and Uncle Sam takes $4,500 off my bill. Why? We know that SUVs not only consume more fuel, but their emissions are dirtier and some studies suggest they are more accident-prone (maybe more a function of the SUV-driver demographic than the actual vehicle class, but still). SUVs may hurt Americans more than cigarettes, yet we tax the hell out of the latter and subsidize the former? So this program hardly discourages the purchase of low-MPG vehicles, which is why the Senate may re-think the weak MPG rules attached to the addition $2B in funding that the House passed. One may still buy a new car that is only 3-5 MPG better than the trade-in clunker and receive $3,500 credit, which is 78% of the maximum rebate. So I can trade in my old Suburban for a slightly smaller Suburban, and somehow that makes me worthy of $3,500 from the taxpayers?

It doesn't make sense. If anything, you should receive a smaller rebate proportional to how low your trade-in vehicle MPG is. If one trades in an efficient but old Civic for a new Civic, that is the "model consumer" the government should reward, not the person trading in an old truck for a new one. And in order to achieve the maximum effect, the trade-in vehicle should be the person's primary or secondary car. If many of these clunkers are a family's "forgotten" fifth car that sits in the driveway and maybe gets 1,000 miles a year, then by removing it from circulation we haven't really helped fight the CO2 problem, because even badly polluting vehicles don't pollute much if they're not driven. So again, the government is subsidizing a family's poor consumer decision and giving them a free pass to the junkyard. And speaking of junking these clunkers - it's not cheap to safely dispose of a junked car. Parts must be salvaged, toxic components must be safely disposed of, and the bulk metal must be compressed or shredded. Or they'll just end up in a Third World nation with laxed environmental laws, like much of the West's consumer trash.

And lastly for goal C - how will this program stimulate the economy? If anything, it looks like another cash infusion to auto companies. Why not just cut a check to the Big 3 and call it even? Because the administrative costs of running this program are not trivial either. "Cash for appliances" seems just as appropriate to meet goals A-C, if not moreso since appliances are cheaper so we can reach more people. As far as I know, there are no income eligibility requirements for CARS. So Warren Buffet and I are equal in the program's eyes. I know it's too early, but I would like to see some demographic data for those who used the CARS program. I highly doubt many of them are "needy" in this recession. Was there even an effort to spread awareness of this program to lower-income or non-English speaking communities? I know CARS is not a charity (it seems DC is mainly interested in helping the rich and irresponsible during this recession), but still. Why not cap eligibility at $150k household income? Otherwise we are giving people who were going to buy a new car anyway a pointless subsidy. Or you have the "cheapskate rich" who are financially able to buy a new car any time they want, but are just waititng for an opportunity like this for Uncle Sam to save them money. Other Americans who unfortunately must rely on their clunker to get to work and pick up the kids from school every day may not be able to afford a newer, better, more efficient vehicle, even with an extra $4,500.

So is this program fair, effective, green, and edifying for America? Possibly but I have my doubts.

Frost/Nixon

http://www.youtube.com/watch?v=jw6LhKCYUCQ

I recently saw Ron Howard's "Frost/Nixon" and was wondering if you've seen it too. I thought the actor who played Nixon (Frank Langella) was pretty poor, mostly mumbling and quasi-senile emotional. His facial and gesture acting were better. I guess they had to make it true to the play, but I don't know why they can't have Nixon talk like a normal person (which he did mostly) instead of the caricatured style he's now famous for. "I am not a crook (flabby cheeks flapping and hands raised giving the 'V for victory')!" I thought Anthony Hopkins was an awesome Nixon in Olliver Stone's "Nixon" from the 1990s; wish they could have brought him back.

They made the film too much like "A Few Good Men" with a big, dramatic "gotcha" moment (a sign of the times I'm sure), but I guess they had to spice up the interviews beyond their original, dry 12-hour form containing mostly heavy political dialogue. Though I did like the theme of how Nixon, so tortured by the fact that he never won the public approval/love that he so craved (in fact he alienated his public), and desperate to restore his honor, grew tired of the incessant denying, blame-shifting, and making excuses for everything. Even if it wasn't the politically intelligent thing to do, he needed to confess and level with the American people (and his soul). The last scene of the film (his revelation) was so over-the-top that I had to see the real interview footage for myself to cut through the BS (sorry it's not on YouTube though). Fortunately the DVD contained some of that material, and I was amazed at the similarities (when you strip away the Hollywood excesses). A shell of his former self, slow and contemplative, with distant eyes and heavy heart, he literally said that he was to blame, he let down his friends and the American people, and most importantly, our system of government - and he'd have to live with that for the rest of his life. I couldn't believe what I saw. I can't imagine a modern politician or CEO doing something even as remotely honest as that. With the Bushies, Clinton, or others, it's always "mistakes were made", "well I can't really comment on that," "we had only the best intentions", etc. The only ones who ever admit to anything are the stupid adulterers who cry in front of the cameras and tell their families and voters that they're sorry - after they repeatedly denied it and only concede once the evidence/public opinion is overwhelming, of course.

But getting back to Nixon, he really was a living Greek tragedy. Strangely I found myself rooting for him in the movie vs. Frost, even though I knew he must fold at the end for this to be a movie. He wanted those interviews to be a vindication of his actions and restoration of his legacy (and maybe even a springboard back into Washington life), and for much of the film he deftly responded to Frost's novice and weak critiques against him with misdirection, irrelevant long-winded tangents, and party-line cliches. I mean, Nixon verbally sparred with JFK, Mao, and Brezhnev; surely he could handle Frost if he wanted to. For a pure SOB and the king of deception, Tricky Dick, to be barely prodded by Frost and mostly of his own accord, rationally admit to the world that he lied, broke the law, and dishonored his office, could be one of the greatest accomplishments of his life, beyond starting the EPA, opening dialogue with China, and detente with the USSR. I guess that is a sad reflection of our times when it's such an amazing feat for a leader to admit wrongdoing long after the fact. America loves a redemption story, and of course Nixon never got that far, but living in today's cynical, insulting-of-our-intelligence political climate, it is a breath of fresh air to see a criminal admit to us, and more importantly himself, what he is. Even if he escaped jail time and other official punishments, one of the largest abusers of presidential power (maybe only behind Lincoln, but of course he had a bigger excuse) served his penance the day he put pen to paper to relinquish the throne of the most powerful person in the world.

NIXON: When a president does it that means it is not illegal (yes, he actually said that, and not on one of his secret tapes).

.......

FROST: Is there anything in the Constitution or the Bill of Rights that suggests the president is that far of a sovereign, that far above the law?

NIXON: No, there isn't. There's nothing specific that the Constitution contemplates in that respect. I haven't read every word, every jot and every title, but I do know this: That it has been, however, argued that as far as a president is concerned, that in war time, a president does have certain extraordinary powers which would make acts that would otherwise be unlawful, lawful if undertaken for the purpose of preserving the nation and the Constitution, which is essential for the rights we're all talking about.

http://www.landmarkcases.org/nixon/nixonview.html

Compare that to Bush and his War on Terror. The only difference is that Bush won't admit that he has exceeded the Constitution, and in fact his team of lawyers seek to reinterpret it. Wartime/national security is always the excuse. Yes, surely waterboarding Osama's driver or tapping my cell phone without a warrant, just like breaking into the DNC offices at Watergate a generation earlier, is essential to the preservation of the Republic. 30 years later, the American people, our system of justice, and our leaders are still wrestling with Nixon's shadow.

---------

i haven't seen the movie but it's funny how you see nixon compare to how i perceive nixon. i was home sick with mono when the watergate investigations were going on(i was only 10 at the time). nixon was the image of the old guard, the previous way of thought left behind along with solving problems with killing. but, was i wrong, but that perception of him stays with me. now, LBJ, he seemed like a tragic figure to me. still does....

---------

I don't know how the Beltway operates these days, but I would hope that Nixon's brand of paranoid "nemesis politics" is over. I guess under Bush II, dissenters were cast out into the wilderness and Kerry was swift-boated, but it's not like Bush was using the PATRIOT Act to nail his political enemies, so far that we know. Well, I guess he didn't have to, since 9/11 solidified his job security, the GOP controlled all 3 branches of gov't until Nov. 2006, and most of Bush's enemies were foreigners. Heh, instead of ex-CIA whack-job plumbers, it seems these days the GOP uses 527 groups and Faux News Channel to do its dirty work.

It's funny how Nixon's people railed against the "liberal establishment" at the time, maybe sowing the seeds for today's right-wing media. As if the NYT and Hollywood were conspiring to help the Viet Cong and foment campus unrest. Nixon often gave the excuse that he abused his power because the nation was in a civil war. Well maybe inside his mind, but he never tried to "bring people together" like our current president seeks to do. Maybe someone like Nixon was more comfortable in conflict. He was always so awkward with the American public, yet craved their approval. Maybe he found his element while negotiating with other SOBs like Kissinger, Mao, and Brezhnev.

At least Nixon didn't use his position to get rich and get his friends rich at the expense of the nation, at least not that I know of. He did use his position to help kill millions of poor people and topple their governments if there was a trace of leftist inklings, but so did many Cold War presidents. Like Obama, Nixon inherited a country at war and struggling with the tensions of a changing population/culture. Let's hope BHO handles our current crisis/opportunity better than Nixon.

---------

Two of your comments stand out in my mind, but probably because I'm thinking of all the modern portrayals of Nixon in popular culture:


"America loves a redemption story, and of course Nixon never got that far..."
"He was always so awkward with the American public, yet craved their approval."


Oliver Stone's "Nixon" really emphasizes those two points in the way Nixon is depicted in the portrayal of the 1960 election: Hopkins' Nixon is anxious, sweaty, and awkward and goes down in flames in the televised debate; he cries to Pat about how the public just won't love him. Even Hunter S. Thompson (who wrote "Fear and Loathing on the Campaign Trail in '72" and hated Nixon with a passion) conceded that the only time he found Nixon to be even remotely congenial was when they discussed college football on a train ride between campaign stops where HST was (somehow) granted an interview.


When I think about the fact that Nixon was an admirer of Henry J. Kaiser's healthcare experiment in California I'm left to think that Nixon was simply "too weird to live, too strange to die"...

Goldman & Chrysler get aid but not CIT?

http://www.chicagotribune.com/business/chi-fri_cit_0717jul17,0,1042812.story?track=rss
http://www.nytimes.com/2009/07/17/business/17factor.html?_r=1&ref=business
http://marketplace.publicradio.org/display/web/2009/07/16/pm_cit/
http://money.cnn.com/2009/07/17/news/companies/goldman_sachs_tarp_ingratitude.fortune/index.htm?section=money_latest

Politicians often laud the entrepreneurial spirit of Americans and claim to be supporters of "small businesses" at the core of this economy. Small businesses need a lot of credit (payroll, raw materials, etc. until sales revenues come in), and many of them fail. So interest rates on them can be fairly high if they patronize traditional banks. That's where CIT (Commercial Investment Trust) comes in. For over 100 years, that company has collected private investment money and in turn loaned it out to small businesses at more reasonable rates. They have over 1M clients and $40B worth of loans, from Dunkin' Donuts franchises to Eddie Bauer to Dillard's to Wal-mart subcontractors. They are on the Fortune 500 and service 80% of the Fortune 1,000, so it's not like they're a podunk community S&L.

Last year, Bush made his case for Wall Street and big bank rescue based on the fact that credit is the lubricant that keeps the gears of our economy rolling. CIT has already received $2.3B of TARP funds, but may need another $3-6B to stay afloat (they asked for $2B yesterday but were rejected by the Obama administration). Credit raters and analysts have already written CIT off as a dead man walking, and the company has lost $3B over the last 2 years. Maybe the company is doomed, and most of us on this email list are against "panic bailouts" to rescue "necessary" players in our economy. CIT is not too big to fail, but its credit services are crucial to retail commerce, and retail needs to rebound if we are to have a real economic recovery. So what do you do? Well, what has Uncle Sam done in the recent past?

Goldman Sachs, an investment bank (before it became a bank holding company to qualify for TARP), received a $10B bailout and government backing of its debt. Whether they desperately needed the money like AIG or BofA is doubtful, but their industry was in free-fall at the time. Did I mention that Goldman was the #2 corporate contributor to the Obama campaign, and gave plenty to Bush, Clinton, and other elite politicians too. Months later it returned its TARP portion of course (on its own accord, not due to government requests), in order to break free of executive compensations limits and other factors. Goldman also posted a huge $3.4B profit in Q2 2009, and analysts expect the company to doll out huge compensation bonuses to those responsible (mostly their fixed income division dealing with currency/commodities trading). Can't you just hear "The Boys are Back in Town" song playing? But now Goldman finds itself in a very different millieu. It's rivals Merrill, Bear, and Lehman, that invested much more heavily in toxic mortgage-backed securities to their own peril, are no more. In fact Goldman poached a lot of talent from those firms in the last half year, and now finds itself the dominant investment house on Wall Street, and they are going to be kicking ass despite this recession and however long it lasts. Less competition and mostly steady demand for their services means they can increase costs (and profits, obviously). So why can't the government give part of Goldman's returned cash to guarantee some of CIT's loans to worthy clients? Obviously they are in great shape and won't need another bailout.

Chrysler is not critical to the national economy, no matter how you slice it. Chrysler reported 58,000 employees in 2008, which is 1/6 the size of Target Corp. They were literally in the grave by the time they filed for Chapter 11 and Fiat took one for the team. As part of the bankruptcy settlement, Chrysler is guaranteed up to $8B US and 4B Canadian dollars (from the gov't of Ontario) in loans, on top of the $4.5B given in 2008 by the Bush crew. That is way more than what CIT is asking for, and those dollars won't go as far. But many Chrysler factories and their unions are very important to various Midwest Congressmen, as well as it's "sentimental value" in the American manufacturing landscape, so I guess they are worthy of rescue.

But not CIT, even though losing them would significantly impact already struggling retail and small business credit sectors. There wasn't enough credit to go around for small business needs before CIT took a nose dive, so if they fail it will get much worse. Desperate small businesses will need to turn to the Big Banks and Wall Street sharks for credit, and will pay dearly for it. Since many small business owners are emotionally and personally invested in their professions, they may go to irrational lengths to keep their life's dream going despite all their red ink. Droves of such desperate borrowers are a banker's wet dream. That tells you how bad the credit market still is when underwriters are still hesitant to loan to such small businesses, even at highway-robbery 20% monthly interest rates. Big banks even have loan vehicles where a small business owner can put his/her retirement account down as collateral. They really smell blood. So much for government reforms to protect borrowers.

It's not like CIT deserves its fate due to incompetence and greed. It was not heavily into the subprime mess. It had a tiny home mortgage arm that it is currently selling, but the core of its business was small-to-medium business loans. The problem is Wall Street investment in CIT is just drying up because investors are clutching their purses tightly in this recession, and as I said, small businesses often go under (especially now). Yet maybe CIT is "too big to fail" anyway; they are 60% of their market. They loan to 2,000 manufacturers that supply 300,000 retailers (60% of apparel makers). It's not like goods just magically appear on store shelves. Even large retailers usually don't own factories and make the goods they sell. It's not efficient. Suppliers/distributors need to be paid, and CIT facilitates that. We often hear of the "ripple effect" that losing a big auto company would have on our country (parts, mechanics, dealerships). Well losing CIT is a Maverick's wave compared to auto's ripple. I don't want to sound alarmist; it's not like CIT will disappear overnight. Parts of the company may be chopped up and sold. But for its core lending function, why can't the government guarantee those loans or even assume CIT's role (temporarily)? It's already sitting on GM's board for Pete's sake. The Federal Reserve has already broken tradition and become a direct lender to commercial banks. I think the government is doing something similar for college loans. Why can't they step in and use some of the TARP billions to support the small businesses that they constantly invoke on the campaign trail?

Well, I guess CIT execs didn't donate enough to the right campaigns. I say this with all seriousness, since they obviously qualify for aid based on the other economic considerations and rationale give to us by Washington leaders. Plus the only reason why a company like Chrysler would qualify for aid is political connections.

To better understand the Iran situation (no BS version)

One of the better discussions I've heard about Iran from Karim Sadjadpour of the Carnegie Endowment for International Peace on "Fresh Air":

http://www.npr.org/templates/story/story.php?storyId=105802915

Certainly some of the recent events in Iran have been disappointing and even abominable to our sensibilities in this country, but we should remember a few things. Like Cuba, the US traditional establishment of the last 30 years has had a fetish for hating anything Iranian. Cuba was the Mob's cash cow that they let get away to the Reds, and Iran was the oil cow they lost to the Muslims. Ironically, Iran is probably the nation-state most culturally compatible with Western values and democracy in the region, yet due to internal decisions and external pressures, they have embraced (or been forced down a path of) revolutionary Islamic philosophy instead. Well maybe not the young people - who comprise over half of the population - but the gray beards clinging to power at least. It was obviously not a foregone conclusion that Iran would become a theocracy, nuclear wanna-be, and financier of terror groups, but probably more of the blame lies with Western imperialists than radical clerics.

Was there blatant fraud in this election and tyrannical government violence against protesters post-election? Surely. Their regime is populated by a bunch of thugs and barbarians, right? They subjugate women and repress civil rights. I have no love for their government (that seems to either be comprised of hard-line fossils like Khamenei or corrupt egomaniacs like Rafsanjani), but let's have a little perspective. The candidate who nets the most votes may not necessarily win an election in this country. In 2000, it is pretty clear that there were significant voting irregularities in Florida. Maybe not enough to change the result, but it was more or less swept under the rug by 5 old men in robes. Protests ensued in many US cities, and in some cases the participants were beaten down and jailed (I am not sure if there were any deaths). Hanging chads, glitches in the electronic voting machines, ineligible voters voting, and vice versa. It even happens here, in the "greatest democracy" of history. And let's not forget the influence of money in our elections. Remember the big protests over the WTO meeting in Seattle, or Bush's Republican Convention in NYC? Government thugs beat up citizens and deprived them of their rights, in our backyard. Probably people died. I wonder if other nations like Iran were condemning us then?

So let's show some humility before chastising Iran for some of the same faults we commit, albeit to a less extreme degree. But even that is debatable, since fraud and tyranny in the US has far more global impact than the same in Iran. And for the hard-liners who criticize Obama for being too "timid" on the issue: what do you expect him to do? Bomb, bomb, bomb... bomb, bomb Iran? We already have harsh sanctions on them. We have no strings to pull over there - they're not Palau. And if we "take a side", back Mousavi, and demand a re-vote, we would play right into the tyrants' hands. All of a sudden their accusations of US tampering and foreign coup seem more plausible, and they can justify a more serious crackdown. Blood will be gushing in the streets - GUSHING.

If we do support the protesters and reformers, then maybe it's best that we keep our big mouths shut and let them decide their own destiny, at least for now. Although most Iranians don't hate America, they're not exactly eager to embrace us either. They know we lust after their resources, will always side with Israel, wish to deprive them of their NPT-approved development of civilian nuclear power, and have over 150,000 troops in their front and back yards. The spectre of Bush is still present, and even Obama said that all options are still on the table (in regards to preventing their nuclear ambitions). In the past, we helped overthrow an elected leader (Mossadeq) who dared to want to nationalize their oil (ahem, I mean Shell and BP's oil), we bankrolled the dictator Shah who abused many Iranians, we mostly took Saddam's side in the brutal Iran-Iraq War where over a million died, and we shot down an Iranian passenger plane (and never apologized for it). So we're not exactly in the best position to send a message.

Case study in health care abuse: McAllen vs. El Paso

“Come on,” the general surgeon finally said. “We all know these arguments [why Medicare costs are highest per capita in McAllen than anywhere else US] are bullshit. There is overutilization here, pure and simple.” Doctors, he said, were racking up charges with extra tests, services, and procedures. The surgeon came to McAllen in the mid-nineties, and since then, he said, “the way to practice medicine has changed completely. Before, it was about how to do a good job. Now it is about ‘How much will you benefit?’ ”

Providing health care is like building a house. The task requires experts, expensive equipment and materials, and a huge amount of coördination. Imagine that, instead of paying a contractor to pull a team together and keep them on track, you paid an electrician for every outlet he recommends, a plumber for every faucet, and a carpenter for every cabinet. Would you be surprised if you got a house with a thousand outlets, faucets, and cabinets, at three times the cost you expected, and the whole thing fell apart a couple of years later? Getting the country’s best electrician on the job (he trained at Harvard, somebody tells you) isn’t going to solve this problem. Nor will changing the person who writes him the check.
- Atul Gawande

http://www.newyorker.com/reporting/2009/06/01/090601fa_fact_gawande?currentPage=all

With the health care debate in DC in full swing, controlling costs and usage are obviously key factors to any reform plan. We previously discussed comparative effectiveness analysis, and it will probably be a key ingredient to any American universal coverage program. This New Yorker piece clearly demonstrates why comp. eff. is long overdue to counter "zealously entrepreneurial" physicians and clinics. We know more care is more costly, but more care is not necessarily better for your health either. "The most expensive tool in medicine is a doctor's pen." I'd laugh if it wasn't so true. The author suggests that the abuses taking place by medical professionals in McAllen is analogous to unscrupulous mortgage brokers in the sub-prime mess. They just want to get as many patients through the door as possible and collect more commission (in some cases, illegal kickbacks). And like the financial industry, incentive systems are set up in medicine to reward these types of excesses, so it's a miracle when some communities like Grand Junction, CO or the Mayo Clinic like can actually buck the trend and offer better health outcomes for less money ("accountable care org's"). The story was written by a doctor too, so he is not just MD-bashing.

Some highlights from the article:

-McAllen... is one of the most expensive health-care markets in the country. Only Miami—which has much higher labor and living costs—spends more per person on health care. In 2006, Medicare spent fifteen thousand dollars per enrollee here, almost twice the national average. The income per capita is twelve thousand dollars. In other words, Medicare spends three thousand dollars more per person here than the average person earns.

-Yet public-health statistics show that cardiovascular-disease rates in [McAllen] are actually lower than average, probably because its smoking rates are quite low. Rates of asthma, H.I.V., infant mortality, cancer, and injury are lower, too. El Paso County, eight hundred miles up the border, has essentially the same demographics. Both counties have a population of roughly seven hundred thousand, similar public-health statistics, and similar percentages of non-English speakers, illegal immigrants, and the unemployed. Yet in 2006 Medicare expenditures (our best approximation of over-all spending patterns) in El Paso were $7,504 per enrollee—half as much as in McAllen. An unhealthy population couldn’t possibly be the reason that McAllen’s health-care costs are so high. (Or the reason that America’s are. We may be more obese than any other industrialized nation, but we have among the lowest rates of smoking and alcoholism, and we are in the middle of the range for cardiovascular disease and diabetes.)

-And yet there’s no evidence that the treatments and technologies available at McAllen are better than those found elsewhere in the country. The annual reports that hospitals file with Medicare show that those in McAllen and El Paso offer comparable technologies—neonatal intensive-care units, advanced cardiac services, PET scans, and so on. Public statistics show no difference in the supply of doctors. Hidalgo County actually has fewer specialists than the national average. Nor does the care given in McAllen stand out for its quality. Medicare ranks hospitals on twenty-five metrics of care. On all but two of these, McAllen’s five largest hospitals performed worse, on average, than El Paso’s. McAllen costs Medicare seven thousand dollars more per person each year than does the average city in America. But not, so far as one can tell, because it’s delivering better health care.

-“[The reason for McAllen's high costs is] malpractice,” a family physician who had practiced here for thirty-three years said. “McAllen is legal hell,” the cardiologist agreed. Doctors order unnecessary tests just to protect themselves, he said. Everyone thought the lawyers here were worse than elsewhere.
That explanation puzzled me. Several years ago, Texas passed a tough malpractice law that capped pain-and-suffering awards at two hundred and fifty thousand dollars. Didn’t lawsuits go down? “Practically to zero,” the cardiologist admitted.
-In a 2003 study, another Dartmouth team, led by the internist Elliott Fisher, examined the treatment received by a million elderly Americans diagnosed with colon or rectal cancer, a hip fracture, or a heart attack. They found that patients in higher-spending regions received sixty per cent more care than elsewhere. They got more frequent tests and procedures, more visits with specialists, and more frequent admission to hospitals. Yet they did no better than other patients, whether this was measured in terms of survival, their ability to function, or satisfaction with the care they received. If anything, they seemed to do worse. That’s because nothing in medicine is without risks. Complications can arise from hospital stays, medications, procedures, and tests, and when these things are of marginal value the harm can be greater than the benefits. In recent years, we doctors have markedly increased the number of operations we do, for instance. In 2006, doctors performed at least sixty million surgical procedures, one for every five Americans. No other country does anything like as many operations on its citizens. Are we better off for it? No one knows for sure, but it seems highly unlikely. After all, some hundred thousand people die each year from complications of surgery—far more than die in car crashes.

-To make matters worse, Fisher found that patients in high-cost areas were actually less likely to receive low-cost preventive services, such as flu and pneumonia vaccines, faced longer waits at doctor and emergency-room visits, and were less likely to have a primary-care physician. They got more of the stuff that cost more, but not more of what they needed.

-In an odd way, this news is reassuring. Universal coverage won’t be feasible unless we can control costs. Policymakers have worried that doing so would require rationing, which the public would never go along with. So the idea that there’s plenty of fat in the system is proving deeply attractive. “Nearly thirty per cent of Medicare’s costs could be saved without negatively affecting health outcomes if spending in high- and medium-cost areas could be reduced to the level in low-cost areas,” Peter Orszag, the President’s budget director, has stated.

-She wasn’t the only person to mention Renaissance [Hospital]. It is the newest hospital in the area. It is physician-owned. And it has a reputation (which it disclaims) for aggressively recruiting high-volume physicians to become investors and send patients there. Physicians who do so receive not only their fee for whatever service they provide but also a percentage of the hospital’s profits from the tests, surgery, or other care patients are given. (In 2007, its profits totalled thirty-four million dollars.) Romero and others argued that this gives physicians an unholy temptation to overorder.

-“In El Paso, if you took a random doctor and looked at his tax returns eighty-five per cent of his income would come from the usual practice of medicine,” he said. But in McAllen, the administrator thought, that percentage would be a lot less. He knew of doctors who owned strip malls, orange groves, apartment complexes—or imaging centers, surgery centers, or another part of the hospital they directed patients to. They had “entrepreneurial spirit,” he said. They were innovative and aggressive in finding ways to increase revenues from patient care. “There’s no lack of work ethic,” he said. But he had often seen financial considerations drive the decisions doctors made for patients—the tests they ordered, the doctors and hospitals they recommended—and it bothered him. Several doctors who were unhappy about the direction medicine had taken in McAllen told me the same thing. “It’s a machine, my friend,” one surgeon explained.

-Beyond the basics, however, many physicians are remarkably oblivious to the financial implications of their decisions. They see their patients. They make their recommendations. They send out the bills. And, as long as the numbers come out all right at the end of each month, they put the money out of their minds. Others think of the money as a means of improving what they do. They think about how to use the insurance money to maybe install electronic health records with colleagues, or provide easier phone and e-mail access, or offer expanded hours. Then there are the physicians who see their practice primarily as a revenue stream. They instruct their secretary to have patients who call with follow-up questions schedule an appointment, because insurers don’t pay for phone calls, only office visits. They consider providing Botox injections for cash. They take a Doppler ultrasound course, buy a machine, and start doing their patients’ scans themselves, so that the insurance payments go to them rather than to the hospital. They figure out ways to increase their high-margin work and decrease their low-margin work.

-In a few cases, the hospital executive told me, he’d seen the behavior cross over into what seemed like outright fraud. “I’ve had doctors here come up to me and say, ‘You want me to admit patients to your hospital, you’re going to have to pay me.’ ”
“How much?” I asked.
“The amounts—all of them were over a hundred thousand dollars per year,” he said. The doctors were specific. The most he was asked for was five hundred thousand dollars per year. He didn’t pay any of them, he said: “I mean, I gotta sleep at night.” And he emphasized that these were just a handful of doctors. But he had never been asked for a kickback before coming to McAllen.

-Powell suspects that anchor tenants play a similarly powerful community role in other areas of economics, too, and health care may be no exception. I spoke to a marketing rep for a McAllen home-health agency who told me of a process uncannily similar to what Powell found in biotech. Her job is to persuade doctors to use her agency rather than others. The competition is fierce. I opened the phone book and found seventeen pages of listings for home-health agencies—two hundred and sixty in all. A patient typically brings in between twelve hundred and fifteen hundred dollars, and double that amount for specialized care. She described how, a decade or so ago, a few early agencies began rewarding doctors who ordered home visits with more than trinkets: they provided tickets to professional sporting events, jewelry, and other gifts. That set the tone. Other agencies jumped in. Some began paying doctors a supplemental salary, as “medical directors,” for steering business in their direction. Doctors came to expect a share of the revenue stream.

-Something even more worrisome is going on as well. In the war over the culture of medicine—the war over whether our country’s anchor model will be Mayo or McAllen—the Mayo model is losing. In the sharpest economic downturn that our health system has faced in half a century, many people in medicine don’t see why they should do the hard work of organizing themselves in ways that reduce waste and improve quality if it means sacrificing revenue.

In El Paso, the for-profit health-care executive told me, a few leading physicians recently followed McAllen’s lead and opened their own centers for surgery and imaging. When I was in Tulsa a few months ago, a fellow-surgeon explained how he had made up for lost revenue by shifting his operations for well-insured patients to a specialty hospital that he partially owned while keeping his poor and uninsured patients at a nonprofit hospital in town. Even in Grand Junction, Michael Pramenko told me, “some of the doctors are beginning to complain about ‘leaving money on the table.’ ”

Another little known casualty of the war on terror

http://www.guardian.co.uk/politics/2008/oct/22/chagos-islanders-lose
http://www.guardian.co.uk/world/2007/may/24/politics.topstories3

Diego Garcia is probably the most important US military base you've never heard of. It's located on the biggest island of the tiny Chagos Archipelago in the Indian Ocean, on land given to us by Britain after it won it from France in the 19th Century. The base has been used to stage bombing missions in the Middle East (though now most sorties originate from our base in Qatr), refueling for long range aircraft (including CIA rendition flights, which they have confirmed to be true), maritime patrol to thwart Somali pirates, a NASA observatory, and a control hub for the GPS system. There are even some allegations, from the UN among others, that it is used as a Gitmo-style prison.

It's geographic location allows critical projection of US force and influence in the Indian Subcontinent, Near East, and Africa, which is partially why India has called for the closing of the base during the Cold War (when they were more aligned with the USSR). But then 9/11 happened, the US and India got chummier, and 40% of the active US military found itself deployed to the region. And now with Russian influence persuading many former Soviet nations to cancel their lease agreements with the Pentagon, overseas airbases are all the more precious.

Now for the victims. The islands have been mostly unpopulated historically, but current "native" Chagossians are descendants of Indian and African slaves brought by Europeans to work the islands' plantations, and decided to permanently reside there. About 2,000 of them were deported during the 1960s-70s to make room for the base's construction. The Guardian reports that some were tricked to leave the islands on temporary work assignments, and then now allowed back. Others were driven out of their homes with dogs and tear gas, and most now live in poverty on the island of Mauritius 1,200 miles away. After a 10-year legal battle, in 2007 a British court ruled in favor of the Chagossians despite pleas from the Foreign Ministry. They pronounced that the eviction was illegal and exiles should be able to return to every Chagos island but Diego Garcia, so it's not like the US had to pack its bags. However, Downing Street appealed the ruling to the House of Lords, and they overturned the lower court's decision the following year by a 3-2 vote.

The US has claimed all along that any native civilian presence there could pose a security risk, and therefore the archipelago should remain unpopulated. But the "security card" argument seems quite dubious, since the US has much larger bases in Iraq, Saudi Arabia, and Afghanistan that are a stone's throw from militants (and have been repeatedly attacked by militants), and we haven't called for the mass deportations of locals around those facilities. While the chance of a terrorist attack is slim at best, Lord Hoffman in the majority decision put it this way: "Some of these scenarios might be regarded as fanciful speculations, but in the current state of uncertainty the government is entitled to take the concerns of its ally into account."

So in this case, pressure from an ally (for the purposes of waging wars on foreign peoples) trumps legitimate redress and civil rights issues of thousands of people under the jurisdiction of overseas British territorial government. While locals have protested US military presence in many nations like the Phillipines and Korea, the Chagossians aren't even hostile to the US base dominating their homeland. Putting bread on the table comes before politics, and they merely want to work in the fishing or eco-tourism industries, or even be part of the base's 3,500 strong workforce. Only about 150 Chagossian families have expressed interest to return, so it wouldn't be a resettlement nightmare, and estimates put the cost of the process at a mere 25M pounds. But instead, the US and UK governments have declared them a security risk, so that's just the way it is.

Making a buck off swine flu panic

My wife works on FDA stuff and found that there are at least 9 companies that the FDA has identified and cautioned for hocking products that claim to "help protect you from H1N1" without any clinical evidence. Magic herbs to protect you against the virus LOL. The "pandemic" didn't last a month and already these guys are working harder than the vaccine makers! Here is an example:

http://www.fda.gov/foi/warning_letters/s7221c.pdf

So if 9 got warning letters, than means that probably 10x as many scamsters exist out there. Well, in panic people will always try to exploit fear for profit. And it's up to the consumer to have the discipline to see past it. But we don't have a very good track record (duct tape after 9/11, stocking up food/water for Y2K, buying up guns/bullets now that Obama is president).

Obama's first 100 days

To Newsweek,

I am writing in response to Jonathan Alter and Fareed Zakaria's articles in the May 4 issue evaluating President Obama's first one hundred days in office. I believe that your publication is continuing its habit from the 2008 campaign period of being a one-sided Obama cheerleader. The fact that your magazine has not printed a single satirical cartoon (of many available, see link below) depicting President Obama, when George W. Bush caricatures were a weekly mainstay, is telling. While I think that Obama's performance is above-average thus far (especially on the environment and science fronts, as well as incremental gains in health care, which your columnists did not recognize), how can Alter and Zakaria fill two pages with accolades while neglecting to make even a single criticism or suggestion for improvement?

http://politicalhumor.about.com/od/barackobama/ig/Barack-Obama-Cartoons/

Plenty of nonpartisan journalists and economists have voiced concerns over some of the White House's more questionable actions. Domestically, Alter and Zakaria totally overlooked:

-Problems associated with unfilled staff positions in the Obama government, because of his well-intentioned but flawed "no ties to lobbyists" policy (yet he has packed his economics team with people well connected to Wall Street).
-Corruption allegations associated with some key cabinet nominees.
-Caving to Congressional Democrats during the crafting of the generally helpful but pork-laden Reinvenstment and Recovery Act.
-Backing down on gun control campaign promises (and virtual silence on the issue), despite multiple atrocious mass shootings.
-Retaining Bush-era state secrecy policies despite pledges to be the most transparent administration ever.
http://www.salon.com/opinion/greenwald/2009/04/06/obama/index.html
-Ambiguity over CIA torture (declaring the practice outlawed and un-American, yet refusing to investigate or prosecute those responsible in the previous regime).
-More mixed signals and controversy over the AIG bonuses.
-Making generous concessions to banks/investors at the expense of taxpayers on TARP.
-Additional billions of Treasury rescue dollars so far have not impelled banks to increase lending, and did not slow the slide of the US auto industry.

While some of these events are out of a president's control, and beyond his influence in the first hundred days, they are at least worth mentioning. I would also like to point out that as of April 29, Alter is incorrect about Obama's budget being approved. Congress did pass interim spending to keep the government running through the summer, but have not passed a version of Obama's massive and contentious $3.6 trillion budget plan that was first proposed in February. According to the Minneapolis Star-Tribune, after months of stalemate Congress is preparing to pass merely a nonbinding budget outline this week.

http://www.startribune.com/ politics/43971737.html

On the international front, Obama has been quite successful and very well received by foreign leaders and cheering crowds, which we have seen before. Mending fences with Russia, making overtures to Iran, easing some restrictions with Cuba, and proposing new arms control talks was refreshing news, and several heads of state have noted that Obama simply winning the presidency has done so much to restore America's image. But so far it's been more words than deeds; Europe has not cooperated much with fiscal/monetary policy or Afghanistan, and there has been no progress towards consensus on Iran or peace in the Holy Land. While no one expects Obama to solve global problems overnight, I think his first steps have been exaggerated. After eight frustrating Bush years, I think any new American leader would be celebrated and welcomed abroad, short of Sarah Palin.

One of his first actions as president was to sign the closing of Guantanamo Bay prison. But declaring it so is different than getting it done, and very few detainees have been transferred or tried. Plus Bagram Air Base in Afghanistan may become our new Gitmo, and there have been testimonials of abuse as well. Obama's near silence over the recent Israeli siege of Gaza (that the UN and other aid groups vociferously condemned) spoke volumes to the Muslim world, regardless of his pledge that the US is a friend. And lastly, Iraq is barely on his radar, even though it was a prominent aspect of his early campaign identity. Violence has spiked recently, and he may find it difficult to adhere to his pledge to bring all combat troops home by the end of 2011.

http://www.newsweek.com/id/168022
http://www.salon.com/opinion/feature/2009/03/09/bagram/index.html?source=rss

He has performed reasonably well considering the circumstances, but I feel that your writer's unwavering praise is somewhat premature and misleading at this point.

http://www.npr.org/templates/story/story.php?storyId=103540635

Obama and CIA torture immunity

"This is a time for reflection, not retribution." - President Barack Obama

"Justice deferred is justice denied." - Congresswoman Diane Watson, at the 50th Anniversary of Brown vs. Board of Education, a ruling that allowed blacks like Watson and Obama to get a quality education that would allow them to one day run for public office.
http://news.yahoo.com/s/ap/20090417/ap_on_re_mi_ea/ml_torture_memos_reaction
http://www.kqed.org/epArchive/R904170900 (first 10 minutes of the interview on this subject)

So Obama and Holder have decided to declassify the CIA memos that describe the torture techniques used during the interrogations of the Bush years. Some have praised that move. This shows that they are all about decency, change, and transparency, right? Well, the CIA has been fighting the release of these documents to the public for years, and ostensibly, Obama has only decided to finally do it because the ACLU lawsuit on the matter looks surely to prevail.

But even worse, he has declared immunity for the CIA personnel who participated in the tortures. He said that those people were patriots who were trying to protect America, and were given assurances by Bush's Justice Dept. that what they were doing was legal. But the same can be said of Nazi concentration camp guards. Did the Nuremberg Commission buy that excuse? They were following orders, they were assured it was ok, they did it for their country.

But the rules of war (and US military rules) state that soldiers have a DUTY to disobey unlawful orders. I don't know about CIA regulations, but many of the jailers and torturers were soldiers borrowed by the CIA for unofficial duties. If someone waves a paper in front of your face saying it's ok to execute the prisoners in your care, what will you do? Hopefully you will disobey because you know that it's wrong and others will punish you when the dust settles, even if at the moment your superiors reassure you that it's legal. But torture is different than execution, right? Is it? Detainees have died in US custody due to "harsh interrogation" that was supposed to be non-life-threatening. Sleep deprivation, stress positions, exposure to severe cold, and beatings with blunt objects don't leave visible damage, but the trauma killed several detainees with health ailments. They could even kill healthy people. At least 3 Gitmo detainees committed suicide, either out of desperation for their predicament, ideological conviction, or a coverup for murder. So when a jailer is ordered to do certain things to a detainee that he is assured are legal, and the physical reaction by the detainee is urination, screaming, vomiting, and even unconsciousness - do you continue as if everything is kosher? Not once do you feel that as a US serviceperson and conscientious citizen, you have the obligation to question whether it is right? Not once as a human do you stop and wonder why you have to cause so much pain to a defenseless stranger (who hasn't even been charged with a crime and has not seen any evidence against them), and whether such brutality is even helping national security? People who didn't stop to ponder those questions are criminals; there's no way around it Obama.

http://www.laprensa-sandiego.org/archieve/may21-04/disobey.htm
http://www.pubrecord.org/torture/677.html?task=view
http://www.truthout.org/article/three-guantanamo-detainees-die-suicides-army-says

The world still looks up to us for moral leadership and social justice (I have no idea why). What kind of message does this send? How can we protest Darfur atrocities, or journalists detained and tortured in Iran? How can we mend fences with the skeptical, angry Muslim world? And beyond that, how do we encourage them to reform politically and respect the rule of law, when we are exonerating the criminals among us? At least jail a couple of Company slackers who had poor performance records anyway, and force some spooks to resign as early retirement with a nice pension. Do something superficial at least, but don't just try to sweep it under the rug as if nothing is wrong. Obama said he would respect the opinion of his AG on the matter, but that is a cop-out. Obviously prosecuting CIA torturers is a legal nightmare. It's probably a tougher challenge than prosecuting terror suspects. Most of these crimes happened years ago overseas, and evidence is shaky at best (remember how the CIA admitted to destroying hours of interrogation and torture videos?). The chain of command is not evident. Well, I'm not expecting convictions and speedy justice, but at least do a little digging around. If the DoJ went after allegedly corrupt US legislators with so much zeal (and made plenty of stupid errors along the way), then I think we can at least try to build some cases against petty CIA torturers, if not the ex-leaders who deployed them. But politics win the day again, and Obama doesn't want to appear that he is on a "partisan witch-hunt", fearing that the GOP may circle the wagons and further impede his ambitious economic recovery efforts.

Obama on the campaign trail, April. 4, 2008:

What I would want to do is to have my Justice Department and my Attorney General immediately review the information that's already there and to find out are there inquiries that need to be pursued. I can't prejudge that because we don't have access to all the material right now. I think that you are right, if crimes have been committed, they should be investigated. You're also right that I would not want my first term consumed by what was perceived on the part of Republicans as a partisan witch hunt because I think we've got too many problems we've got to solve.

So this is an area where I would want to exercise judgment -- I would want to find out directly from my Attorney General -- having pursued, having looked at what's out there right now -- are there possibilities of genuine crimes as opposed to really bad policies. And I think it's important-- one of the things we've got to figure out in our political culture generally is distinguishing betyween really dumb policies and policies that rise to the level of criminal activity... I think a basic principle of our Constitution is nobody above the law -- and I think that's roughly how I would look at it.
http://www.philly.com/philly/blogs/attytood/Barack_on_torture.html
http://www.salon.com/news/feature/2008/08/04/obama/

I think it should be obvious to a law professor that you don't know if a crime has been committed unless you investigate first. So investigate instead of sweeping it under the rug! Both Obama and Holder have been quoted proclaiming unequivocally that waterboarding is torture. Warterboarding was a sanctioned technique in the declassified CIA memos. Torture is illegal according the US Army Field Manual, Geneva Conventions, and many other codes. "No one is above the law". "Genuine crimes as opposed to really bad policies?" Well torture is a really bad policy as well as a genuine crime, and no one is above the law, right? Even the CIA. But I am sure Obama and Co. don't want to piss off the spooks, whom they will need to help defend America, assist our allies, and win our overseas wars. Obama already nominated an outsider to head the CIA, probably insulting the senior staff who were looking for a promotion. He doesn't want to hurt morale any further, even at the cost of justice.

Goldman Sachs TARP payback

http://www.npr.org/templates/story/story.php?storyId=103122382
http://en.wikipedia.org/wiki/Goldman_Sachs
http://www.marketwatch.com/news/story/story.aspx?guid=%7B18220CBF%2D2FAB%2D4943%2D9693%2D0336B2D16A01%7D&siteid=rss

"Clearly we have created banks that are too big to fail; should we be asking if they are also too big to exist?" - Simon Johnson

There was an interesting interview on Fresh Air yesterday with Simon Johnson, the chief economist at the International Monetary Fund during 2007 and 2008. He is a professor at MIT's Sloan School of Management. He raised some interesting points about the bank bailout and the concerns over the Goldman TARP payback news. He also wrote a piece in The Atlantic describing the ways that the financial sector asserts its dominance over Washington, often at our expense.

http://www.theatlantic.com/doc/200905/imf-advice

Goldman (stock was near 200 before the crash, hit a low of 45 in Dec., and now is back to 120) claims that it took $10B in TARP money last year because the gov't twisted its arm - Treasury wanted to give aid to healthy banks as well, so that it wasn't obvious to the public which banks were the most troubled, in order to head off bank runs. Goldman claims it didn't really need a rescue, and now like Wells Fargo they are doing fine, so they want to repay their TARP loan. They want to do this to unfetter themselves from all the TARP-associated restrictions, namely compensation limits. With their competitors struggling, Goldman thinks it will be able to attract the top talent during this recession, so that they will be better poised to clean house once the economy rebounds. Basically they want to stack the deck, even if it puts the overall bank recovery and TARP program at risk. With the entire system still near the precipice, old habits die hard for greedsters like Goldman.

But TARP rules state that it is the GOVERNMENT, not the banks, that makes the final call about how and when institutions pay back their TARP loans. So this may become a showdown between the "bank oligarchy" and the Federal Government about who calls the shots during this precarious process. But in Goldman's case, it's more complex. Some think that the Feds would love to get Goldman's $10B returned, because it validates their bailout efforts and demonstrates that the financial industry may be on the mend. Also Geithner will have a fresh $10B to dole out to others. Seems good, right? Well, $10B is a drop in the bucket compared to the trillion dollars Bush/Obama have already injected into economic recovery efforts. More critically, if Goldman returns its loan to show that it is doing well, what does that say about other banks that don't? Will the public assume the worst about them? Even relatively healthy banks may not plan to repay TARP loans in the next 12 months, but now they may feel pressured to accelerate their plans, which may not be beneficial to their institution, clients, and shareholders. But to be fair, Goldman is not the first to try to repay its federal loans; 6 others banks have already done so, and others are considering it, though they're small regional banks and not household names with global influence like Goldman.

This pre-emptive strike is a big middle finger from Goldman to its competition... and to the gov't/taxpayers too. Many critics think that the Feds have already bent over backwards to help Wall Street. You'd think the least the banks could do is hold up their end of the bargain and play straight with us. Nope. Obama had to practically beg them to even accept conditional bailouts (with pay limits), and throw in huge incentives/guarantees for them to offer up their "troubled assets" to investors through the Geithner plan (many banks are still mulling it over). Trying to cover their own asses, the banks have fought us every step of the way, which has only worsened the financial crisis and delayed recovery. And now they have the hubris to think that beggars can be choosers. If the Feds let Goldman have its way now, it will show the public (and other banks) who's boss, as well as cast doubt on the gov'ts ability to better reform and regulate the financial sector in the future.

But we really shouldn't be surprised. Goldman is an investment bank, but during last fall's crash, it applied to become a bank holding company (like Citi and BofA), just so they could be eligible for Federal Reserve assistance. Morgan Stanley did the same, so now actually none of Wall Street's historic i-banks exist anymore. But Goldman is not a bank, it's a risk-taking brokerage house. Just because it bought a few struggling boondocks community banks, doesn't mean it should enjoy savings and loan status. Also, it's hard to argue that Goldman was healthy all along and just took TARP to be a team player. $13B of the initial $80B that went to help AIG meet its debt underwriting obligations went to Goldman.

We have discussed the "revolving door" between Congress and lobbyists, but what about the r-door between Wall Street executives and financial regulators? Clinton's Treasury Sec. Robert Rubin, W's Treasury Sec. Hank Paulson, Geithner's chief of staff, the current head of the CFTC, and others in government are ex-Goldman employees. There is no way they aren't getting preferential treatment from Washington. Oh, and did I forget to mention that Goldman was Obama's #2 campaign donor?

The American financial industry gained political power by amassing a kind of cultural capital—a belief system. Once, perhaps, what was good for General Motors was good for the country. Over the past decade, the attitude took hold that what was good for Wall Street was good for the country. The banking-and-securities industry has become one of the top contributors to political campaigns, but at the peak of its influence, it did not have to buy favors the way, for example, the tobacco companies or military contractors might have to. Instead, it benefited from the fact that Washington insiders already believed that large financial institutions and free-flowing capital markets were crucial to America’s position in the world.

Big banks, it seems, have only gained political strength since the crisis began. And this is not surprising. With the financial system so fragile, the damage that a major bank failure could cause—Lehman was small relative to Citigroup or Bank of America—is much greater than it would be during ordinary times. The banks have been exploiting this fear as they wring favorable deals out of Washington. Bank of America obtained its second bailout package (in January) after warning the government that it might not be able to go through with the acquisition of Merrill Lynch, a prospect that Treasury did not want to consider.

-Simon Johnson