Weekend Economists Under the Influence of Saturn, November 16-18, 2012

[Demeter]

Saturday, I say goodbye to my dear friend:



This isn't the actual car, but the 1994 Saturn SL1 that kept me going for several years and 95,000 miles (I bought it with 117,000 from the original owner) is very like it...a little more battered, and unless gifted with a new engine, permanently immobile.

The Saturn was a new concept in American automobiles: it was designed to compete with the sporty, sleek, small Japanese brands that were taking over the American market. And it did! Even today, there are Saturns all over Michigan's highways. Except for my old friend...

The Saturn Corporation was an automobile manufacturer and brand, established on January 7, 1985 as a subsidiary of General Motors in response to the success of Japanese automobile imports in the United States. The company marketed itself as a "different kind of car company," and operated somewhat independently from its parent company for a time, with its own assembly plant in Spring Hill, Tennessee, unique models, and a separate retailer network.

Following the withdrawal of a bid by Penske Automotive to acquire Saturn in September 2009, General Motors discontinued the Saturn brand and ended its outstanding franchises on October 31, 2010. All new production was halted on October 1, 2009. ---wikipedia

The Saturn was designed by engineers, and you could tell. It ran like a champ...my baby never died until AFTER I finished my daily paper route, and the mechanics could fix it quickly and cheap. It had a lot fewer parts than most cars...there were parts in the Volvo (before Ford) that I'd never heard of before or since.

So Demeter is in mourning....the baby got its death sentence in June, and I've grieved enough to let go (more like, got enough more pressing problems out of the way so that I can deal with this one...)

[Demeter]

1. A History of Saturn

1982–90: Formation

Alex C. Mair began discussions of a "revolutionary new, small-car project codenamed 'Saturn'" in June, 1982. In November, 1983, the Saturn idea was publicized by General Motors' Chairman Roger B. Smith and GM's President F. James McDonald. Twelve months later, the first Saturn demonstration vehicle was revealed. On January 7, 1985, the Saturn Corporation was officially founded.[6]
1990–2000: "A new kind of car company"
Saturn S-Series

In July 1990, GM Chairman Roger Smith and UAW President Owen Bieber drove the very first Saturn off the assembly line in Spring Hill, Tennessee. The brand was marketed as a "different kind of car company," and Saturn operated outside the GM conglomerate, with its own assembly plant in Spring Hill, unique models and a separate retailer network.

Results at Saturn were mixed. According to The Wall Street Journal, the project was too ambitious, as "everything at Saturn is new: the car, the plant, the workforce, the dealer network and the manufacturing process. Not even Toyota, everyone's candidate for the world's best automaker, tackles more than two new items on any single project." While Saturn cars proved very popular with buyers, actual sales never met the optimistic projected targets, in part because of a recession in 1990. It also proved cannibalistic as 41% of Saturn buyers already owned a GM car. Its separation from the rest of its GM parent, plus the fact that it drained $5 billion from other car projects, stirred resentment within GM ranks. Also, Saturn opened at considerably higher cost than the Japanese transplants (factories that Japanese automakers established in the United States). [7][8]

Nonetheless, the brand was immediately known for its "no haggle" prices. The first Saturn model, the S-Series, was significantly successful. A year later, Saturn hit the Canadian market. 499,999 Saturns later, "Carla" entered the market in 1993. In May 1995, "Jasper", Saturn's Millionth car is produced. In 1996, Saturn Dealerships distributed the electric General Motors EV1, the first car released under the GM marque. In 1997, Saturn became the first General Motors North American vehicle to be fully built with right-hand-drive on the same assembly line as the left-hand-drive vehicles (the previous right-hand-drive GM North American vehicle were built in the countries with left-hand road rule using the CDK kit and customised dashboard and steering components) as it entered the Japanese market. In January 1999, Saturn rolled out its two millionth car. Later that year, Saturn began production of its all new L-Series.
Saturn L-Series
2000–08: model expansion

Saturn's first compact crossover SUV was introduced for the 2002 model year as the Vue, based on a globally used GM design. For 2003, Saturn introduced the Ion as a replacement to the S-Series. For 2005, Saturn began selling the Relay, a minivan and the first Saturn based on similar models from other GM brands. That same year, the L-Series was discontinued. The Sky roadster was introduced in 2006 as a 2007 model. Also for 2007, the Aura midsize sedan made its way to dealerships, alongside the Outlook, a larger CUV than the Vue, and was the last year the Ion was produced. The Ion was replaced by the European-built Astra in 2008. During the 2008 North American International Auto Show (NAIAS), Saturn revealed its Flextreme concept vehicle, which was a rebadged Opel Flextreme.[6]

In 2004, GM and the United Auto Workers dissolved their unique labor contract for the Spring Hill manufacturing plant, allowing Saturn operations to be integrated with the rest of GM.[9]
2008–09: attempt to sell brand, market changes

In US Congressional hearings on December 2, 2008, General Motors announced its intentions to focus on four core brands (Chevrolet, Cadillac, Buick, GMC), with the sale, consolidation, or closure of Saturn and the remaining brands (Pontiac, Hummer, and Saab).[10] General Motors Chairman and former CEO Rick Wagoner announced during a news conference on February 17, 2009 that Saturn will remain in operation through the end of the planned lifecycle for all Saturn products (2010–11).

In February 2009, GM declared its intent to part with this brand by closing or selling the division, either to investors or to dealers, as part of restructuring plans dependent upon the receipt of a second round of government loans ("bailout" funding).[11] It is the third such action for GM in the 21st century, following those of Oldsmobile, which ceased production in 2004, and Pontiac, which ended production of the 2010 model year by the end of 2009.[12]

General Motors announced in June 2009 that it was selling the brand to Penske Automotive Group.[13] The arrangement was similar to the deal under which Penske distributes Daimler AG's Smart Car in the United States.[14] Penske was not planning to buy the factories and would eventually have to contract other car companies to build cars sold as Saturns. GM would have built the Aura, Vue, and Outlook for Penske for two years. To replace GM as the brand's manufacturer, Penske was in discussions with several global automakers, including Renault Samsung Motors of Korea.[15]
Wikinews has related news: Penske Auto selected to buy General Motors' Saturn unit

By the end of 2009, GM closed all of its 46 Saturn dealerships in Canada, even for Saturn dealerships also selling Saab vehicles. GM and Penske decided that they could no longer make a business case to distribute Saturn vehicles in Canada after the sale of the brand. Saturn's customer service, parts, and warranty operations will move to other GM dealerships in Canada.[16]
2009: sale falls through

On September 30, 2009, Penske terminated its discussions with GM to acquire its Saturn subsidiary. The tentative agreement was for GM to continue to produce the Saturn line until 2011; after that time, an undisclosed third company would assume production responsibilities. Penske's decision to back out of the sale came after an undisclosed company's board rejected plans to take over production of the Saturn line.[17] The undisclosed "company" was later reported to be the Renault-Nissan alliance, reacting mainly to objections from the latter.[18] Subsequently, GM stated they will shut down the division and dealers would have to close by October 2010.[19] Since that date Saturn vehicles have been serviced at other GM dealerships.[17]

Meanwhile, the Outlook was the last Saturn to be produced, although it is unknown when production ended. Although all Saturn production ended October 2009, only the Outlook resumed from hiatus by February 2010 for production.

In February 2010, as a means of customer retention, GM announced it was offering existing Saturn owners up to US$2,000 in incentives on purchasing a new Chevrolet, Cadillac, Buick or GMC vehicle until March 31. Customers were required to have owned their Saturns for at least six months and were not required to trade them in to be eligible for the incentives.[20]

Saturn Authorized Service Providers have been introduced since the closing of the Saturn brand. Most Saturn Authorized Service Providers are at Cadillac and Chevrolet dealers. Saturn Authorized Service Providers are responsible for all aspects of service, including warranty service, on Saturn vehicles.
Models
Earlier models

Originally, the company's products used a dedicated platform called the Z-body and a dedicated engine, the 1.9 L Saturn I4 engine, and a dedicated plant in Spring Hill, Tennessee. All of the original Saturns featured dent-resistant plastic body panels which were also touted as allowing the company to change the look of the vehicles readily. However, in practice, the company did not often take advantage of this capability.

Saturn S-Series cars were produced from 1991–2002. There were 3 Generations of S-Series Cars. First Generation S-Series cars were produced from 1991–1994. For the 1995 Model year, Saturn implemented a "First Generation" exterior, and "Second Generation" interior. The exterior of the 1995 model year looked the same as the first generation cars, but exhibited larger gauge faces on the instrument cluster, and a redesigned middle console. First Generation engines were rated at 85 horsepower (63 kW) for the Single Overhead Cam Engines, while the Dual Overhead Cam Engines were rated at 124 horsepower (92 kW) for the entire run of S-Series cars (1991–2002). In 1996, the Second Generation S-Series Sedan was introduced and remained virtually unchanged for the rest of the vehicle's production run. In 1997, the Second Generation of the Sport Coupe model was introduced with a more "scooped" headlight front. The 1999 Coupe models received a suicide door behind the driver side door. The S-Series was produced in three variations: Coupe (SC), Sedan (SL), and Wagon (SW). The Wagon was introduced for the 1993 Model year and was produced until 2001.

The first real change came with the 2000 Saturn L-Series mid-size car. It shared the GM2900 platform with the Opel Vectra, along with its engine, and was built at a GM factory in Wilmington, Delaware. In 2003, the Saturn Ion replaced the S-Series compact.

The market did not respond well to these models. Ion production lines were halted for two weeks in 2003 to allow dealer inventory to reduce. The L-Series was canceled after production of the 2005 models, and the Ion was canceled after 2007.

[Demeter]

2. Winning Awards Wasn't Enough for Corporate Bean Counters

1991
Saturn receives two "Silver Anvil" awards for community and internal relations.

Saturn receives Popular Mechanics "Design and Engineering" award for "manufacturing processes that result in exceptionally high quality for an all-new vehicle."

Saturn receives "Driver's Choice awards for best small car" from MotorWeek.

1992

Saturn receives "Driver's Choice awards for best small car" from MotorWeek.

Saturn is in the "Top Ten Domestic Buys" according to Motor Trend magazine.

Saturn receives the "EVE" award for Saturn's attempt to employ women and minorities.

1993

Saturn receives the Best American Car Value Under 13,000; Lowest Total Cost To Own—American Car; Best Overall Value—Compact Class under 16,500; from Intellichoice.

Saturn receives Technology of the Year from Automobile Magazine.
1995

Saturn receives Best American Car Value under 13,000; Best Compact Under 17,000; Best Subcompact over 12,500; from Intellichoice.

1996

Saturn receives Best American Car Value under 20,000; Best Compact Value under 17,000 (import or domestic); by Intellichoice.

Saturn receives the award for Best Small Wagon (import or domestic).

Saturn receives the award for Best Subcompact value under 12,000 (import or domestic).

Saturn receives the award for Best Subcompact value over 12,500 (import or domestic).

1997

Saturn receives Best Car Value Under 20,000; Best Compact Value under 15,000; Best Subcompact Value under 14,000; Best Small Wagon Value; from Intellichoice.

Saturn is the Leader in "Brands under 20,000".

1999

Saturn receives awards for Best Compact Value under 20,000; Best Small Wagon Value.

Saturn S-Series gets a Double 5-Star rating in Driver & Passenger in front-collision tests.

2000

Saturn is voted MotorWeek's "Best Family Sedan".

Saturn receives "Best Overall Value of the Year" for SL and SL1 from Intellichoice.

Saturn in Spring Hill receives "Most Valuable Pollution Prevention."
2007

Saturn's 2007 Aura claims North American Car of the Year.
2008

Saturn's Outlook receives Parents Magazine/Edmunds.com "Best Family Car 2008", "Best Crossover Utility" by MotorWeek Drivers, "Best New Family Vehicle" from kbb.com.

[Demeter]

3. How GM Destroyed Its Saturn Success David Hanna, 03.08.10

http://www.forbes.com/2010/03/08/saturn-gm-innovation-leadership-managing-failure.html

A lesson in how to win at innovation in even the most traditional company--and then how to crush that innovation...

General Motors is once again reshuffling its management team--a common occurrence ever since the government took control of the company to save it from bankruptcy last July. One has to keep asking what is so deeply wrong at GM that it can't escape constant turmoil and ongoing struggle. And what really happened to its Pontiac, Hummer and Saturn brands?

A look at the story of the Saturn Corporation provides some answers. Saturn, a GM company that had great promise in the early 1990s, ultimately failed because senior GM leaders couldn't see the benefits of new ways of doing things and a new kind of organizational culture.

In the 1980s Roger Smith, then GM's chief executive, and Donald Ephlin, head of the United Auto Workers for the company, stood together behind the creation of a new kind of American carmaker, but their successors were less committed to breaking with tradition. The initial passion and vision gradually dissipated, and now it is being officially extinguished. Saturn stopped production in October and is expected to close down completely later this year. Apparently GM and the UAW really didn't want a "different kind of company" or a "different kind of car."

The company was launched at a time when confidence in American cars and the morale of American autoworkers were both plummeting. Smith and Ephlin wanted to prove that a U.S. car company could hold its own against formidable foreign competition. The basic concepts behind the Saturn Corporation were simple and self-evident: having a team of people who were committed to both their customers' needs and one another's success; demanding accountability for results and developing multi-skill flexibility throughout the system so that team members could work and assist others wherever there was a need; treating all stakeholders as partners, because that was exactly what they were; doing whatever it took to be competitive with the best carmakers in the world....Whenever the name Saturn has come up in my conversations through the years, it has usually gotten either of two opposite responses. People either admired the company and its cars or were skeptical, cynical and belittling of anything it did. Some of the most passionate in the latter group were GM managers, employees and UAW officials in other GM divisions. They resented Saturn and are happy to see it go. But here are some impressive early accomplishments that were largely unpublicized at the time and have been forgotten in the years since.

--Because of an enthusiastic market response to their "different kind of car," Saturn retailers were chronically short of vehicles for the first five years of production.

--Saturn was the third best-selling car model in the U.S. in 1994. When the production lines switched over to the 1995 models, there were only 400 '94 Saturns left on lots across the country.

--J.D. Powers consistently rated Saturn as among the top three cars in owner and customer sales satisfaction. Even as late as 2000 it ranked second in owner satisfaction, behind Lexus.

--Most of the 9,000 Saturn employees (at the mid-1990s peak) came from other GM plants, through an agreement between GM and the UAW. This different kind of company was created by people who all came from the old, traditional kind of company. They changed the way they thought about the workplace, committed themselves to being world-class and altered many work habits to keep their promises to their customers. And they did so without any external incentives.

--Thanks to a unique partnership between Saturn and its retailers, in 1993 the retailers rebated back to Saturn 1% of the cars' sales price, to get GM's permission to start a third production shift. That brought $13 million to Saturn's bottom line, moving its finances into the black a year ahead of plan.

--Owner enthusiasm went off the charts, as was demonstrated when nearly 100,000 owners attended two "homecoming" celebrations in 1994 and 1999....

[Demeter]

4. What happened to that 1990s success story?

...Despite what you may read elsewhere, there were just two underlying forces behind Saturn's demise: GM's insistence on managing all its divisions centrally with a tight fist, and the demand by leadership at both GM and the UAW that Saturn get in line with traditional ways of doing things.

As I learned from many GM executives at Saturn and elsewhere, GM manages its businesses monolithically. When it launched Saturn, it told the other divisions they couldn't have any money to upgrade or introduce new models, because the Saturn launch was gobbling up all the funds. Hence everyone in the GM family was hostile toward and jealous of the new arrival. The same dynamic hit Saturn again a few years later when the market shifted and it desperately needed a midsize car and an SUV. Sorry, GM leadership said. It was the other divisions' time to get the money. Everyone had to take a turn--and every division was penalized in the process.

GM also came to want Saturn to be like the rest of its offerings, a compilation of standard GM parts with a different nameplate, not a different kind of car. Saturn's unique power train (the so called "smart" transmission), its polymer body panels that didn't dent or rust, its sand-cast aluminum engine block and its no hassle, no dickering retail sales experience--those were all nice experiments, but they weren't really the GM way. Company leaders even lectured Saturn that the GM way was more profitable, because it used the same parts across many automobile platforms.

Just as GM management wanted to scrap the different kind of car, the UAW wanted to end the unique memorandum of agreement between Saturn and UAW Local 1810 that permitted profit sharing, more rigorous accountability for results, multi-skills assignments and job flexibility. Despite Saturn's early success, Local 1810 came under constant fire from above to get in line. One local president was removed from his position by the UAW, and a successor was treated as a heretic for wanting, as he put it, to "create a viable model for the labor union in our modern era."

Three times the UAW International came to Saturn's Spring Hill, Tenn., production facility with its international contract in hand and told Saturn's workers to vote for it. Three times those workers voted no and clung to their memorandum of agreement. (Which, by the way, was the size of a brochure, not the volumes one typically sees in such agreements; when the commitment is clear and genuine and the partners trust each other, you don't need volumes to document your agreement.) A local union membership rejecting the standard labor contract? Such a thing had never happened before, at least not in the auto industry...

[Demeter]

5. Sounds Japanese, no?

...The problem, GM and UAW executives came to realize, was the new organizational culture that had been born in Spring Hill. Saturn people didn't think of themselves as GM subordinates or as UAW card carriers. They were Saturn team members with a common mission.

The only way to overpower such a culture is to draw and quarter it. GM, with the UAW's obvious blessing, broke up the Saturn empire. Production was taken out of Spring Hill and divided among other GM plants. Saturn's workers, now only one small piece of a larger population, became part of the larger GM workforce in their new locations and subject to the UAW International contract.

Unity was achieved. Tradition was protected. Everyone was back in line.

To all the outsiders who have witnessed Saturn's failure, if you ever find your corporation in a losing position in the marketplace, if you feel your people just can't compete with world-class, if you don't believe your organization can make enough changes to stay in the race, or if you feel someone else needs to bail you out, just remember--you can create a different kind of company and a world-class product.

That is Saturn's legacy.

***********************************************************

David Hanna is a Principal with The RBL Group, a firm that provides consulting and executive education in strategic HR and leadership. He has worked with clients in North and South America, Asia, Europe, Australia and Russia.

HE WAS A FOND OWNER OF A 1994 SATURN, TOO!

[Fuddnik]

11. I almost bought a Saturn in 1993.

I had my choices narrowed down to 3 cars. A Saturn, an Eagle Talon, and a two seater Honda. I forget the model.

Didn't like the Saturn at all. The Eagle just wasn't what I wanted, and I stood around unnoticed at the Honda dealer for about 30 minutes and left. Stopped at the Ford dealer and fell in love with a Probe GT, and drove it home.

[Demeter]

6. AND WE HAVE A BANK DOWN IN GEORGIA, FOR A CHANGE

Hometown Community Bank, Braselton, Georgia, was closed today by the Georgia Department of Banking and Finance, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with CertusBank, National Association, Easley, South Carolina, to assume all of the deposits of Hometown Community Bank.

The two branches of Hometown Community Bank will reopen on Saturday as branches of CertusBank, N.A...As of September 30, 2012, Hometown Community Bank had approximately $124.6 million in total assets and $108.9 million in total deposits. In addition to assuming all of the deposits of the failed bank, CertusBank, N.A. agreed to purchase essentially all of the assets...The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $36.7 million. Compared to other alternatives, CertusBank, N.A.'s acquisition was the least costly resolution for the FDIC's DIF. Hometown Community Bank is the 50th FDIC-insured institution to fail in the nation this year, and the tenth in Georgia. The last FDIC-insured institution closed in the state was Jasper Banking Company, Jasper, on July 27, 2012.

[Demeter]

7. Fiscal Cliff Talks Get Started

http://www.npr.org/blogs/thetwo-way/2012/11/16/165266514/fiscal-cliff-talks-get-started?ft=1&f=1001

President Obama and congressional leaders from both major parties are meeting at the White House ... for the first of what will likely be many negotiations aimed at averting a plunge over the so-called fiscal cliff...

AND MAY GOD HAVE MERCY ON OUR SOULS

[Fuddnik]

12. Get your parachutes ready.

We know who's going over the cliff.

[Demeter]

8. 10 things stores won’t say about Black Friday

YEP! TIME TO GET IN SHAPE FOR THE SHOPPING MARATHON OF THE YEAR....

http://www.marketwatch.com/story/10-things-stores-wont-say-about-black-friday-2012-11-17?siteid=YAHOOB

1. “Expect pandemonium at the stores.”

Stores are anticipating a huge turnout — read: crowds — this year. According to a survey conducted by management consulting firm Accenture, 53% of consumers say they plan to shop on Black Friday, up from 44% last year. That would reverse three years of declining consumer interest in the day, based on the company’s previous surveys...

2. “We ruined Thanksgiving.”

Thanks to retailers, Black Friday comes earlier each year. This year, some stores will roll out their Black Friday deals before the Thanksgiving dinner table is cleared. Sears, Toys “R” Us and Wal-Mart deals will kick off at 8 p.m. on Thanksgiving night in most locations. Most Target stores will open at 9 p.m., while Macy’s and Best Buy will open doors at most locations at midnight. Retail experts say it’s all meant to build up consumer demand for the day....

3. “Black Friday came early.”

Lots of retailers started the Black Friday-like come-ons in early November this year. The reason is simple. Consumer spending this holiday season is expected to increase 4.1% over the last holiday season. Still, that’s down from the 5.6% growth retailers saw last year, according to the National Retail Federation. With consumers putting a cap on their budgets, retailers are jockeying to be the first stop shoppers make, says Jason Baker, a partner with X Team International, a retail brokerage alliance...

4. “You should have stayed home.”

Jen Dorman, 28, was on the hunt for a cheap slow cooker. She spent hours at the stores on Black Friday two years ago looking for a doorbuster discount. By the time she got to the stores, the model she wanted was nowhere to be found. “I felt like I’d gone through an obstacle course and I was wasting all this time,” Dorman says. Tired and annoyed, she says, she returned home and searched for the appliance online and found it. What’s more, it was selling at a lower price than the brick and mortar stores were advertising. Oh, and, she got free shipping too. As retailers compete for more sales, they’re putting their Black Friday deals online as well...

5. “Prepare for violence.”

6. “You won’t give us your email address? Say goodbye to some deals.”

7. “Don’t expect good quality.”

8. “We market to women (but not the best deals).”

9. “Don’t be fooled by credit card discounts offers.”

10. “We’ll try to keep you in the store all day.”

DETAILS AT LINK....I'M PLANNING TO SLEEP IN, MYSELF. SORT OF AN EARLY XMAS GIFT.

[Demeter]

9. Obama administration officials hopeful FHA can avoid a bailout

DELUSION FOR XMAS...

http://www.latimes.com/business/money/la-fi-mo-fha-bailout-federal-housing-administration-20121116,0,2518680.story

Obama administration officials said Friday they are hopeful that the Federal Housing Administration can avoid a bailout despite the agency's increasingly troubled finances.

The FHA said it ended the latest fiscal year in September with $16.3 billion in projected losses, which could require an infusion of taxpayer money into the government agency for the first time in its 78-year history.

A final determination on a bailout would not come until next September and could hinge on continued improvement in the housing market, officials said. The agency also plans changes, including increasing the premiums it charges homeowners to back their loans, that it hopes will boost its reserves...

[Warpy]

10. No more bailouts!

If it is insolvent, re nationalize it.

Yes, it was never meant to be in private hands. It was started as a government bank to take over 30 year mortgages so that local banks could afford to relend the money, thus making home ownership more possible than the old balloon mortgages had made it.

Bankers thought they were getting a great deal in the 30s, passing along loans that would take forever to pay off and getting a kickback to administer them. By the 70s, they saw how much that 3-8% interest was raking in and lobbied Congress to privatize Fannie Mae. Freddie Mac was created a little over a year later to give the illusion of competition.

Putting these mortgage holders into private hands just encouraged risky behavior, although they still had to create Indy Mac to take all the really toxic paper off their hands and recycle it into toxic investments.

There was no earthly reason to privatize Fannie Mae but greed on the part of the bankers. It should never have been privatized. No more bailouts. Put it back into public hands where it has always belonged.

[Demeter]

13. Saving the Planet or ‘Fixing’ the Debt By Dean Baker

http://www.nationofchange.org/saving-planet-or-fixing-debt-1352562807

Imagine Japan attacked at Pearl Harbor in December of 1941 and our political leaders responded by debating the best way to deal with the deficits projected for 1960. This is pretty much the way that Washington works these days. The political leadership, including the Washington press corps and punditry, were already intently ignoring the economic downturn that is wreaking havoc on the lives of tens of millions of people across the country. Now, in the wake of the destruction from Hurricane Sandy, they will intensify their efforts to ignore global warming. After all, they want the country to focus on the debt, an issue that no one other than the elites view as a problem.

The reality of course is straightforward. The large deficits of recent years are due to the economic downturn caused by the collapse of the housing bubble. If the economy were back near its pre-recession level of unemployment then the deficits would be close to 1 percent of GDP, a level that could be sustained indefinitely. But the deficit scare mongers are not interested in numbers and economics; they want to gut key government programs, most importantly Social Security and Medicare. That is why they are pushing the fear stories about the debt and deficit. This is the rationale for the Campaign to “Fix” the Debt, a collection of 80 CEOs ostensibly focused on getting the budget in order.

What is perhaps most infuriating about this crew is the claim that their efforts are somehow designed to benefit our children and grandchildren. This is bizarre for a number of reasons. First, while they do want to cut Social Security and Medicare for current retirees and those expecting to benefit from these programs in the near future, the biggest cuts in their plans will hit today’s young. In effect they are promising to “save” these programs for young workers by destroying them. Under most of the proposals designed to “fix” these programs Social Security will provide a sharply reduced benefit for retirees in 40-50 years compared with the currently scheduled level, and Medicare will by no means ensure most seniors access to decent health care.

However the even more bizarre aspect of their generational equity logic is the idea that somehow the well-being of future generations can be measured in any way by the size of the government debt. This point should have been pounded home to even the thickest deficit hawk by Hurricane Sandy. What we do or don’t do in the next decade will have a huge impact on the climate conditions that our children and grandchildren experience. Imagine that we listen to our Campaign to Fix the Debt friends and find a way to pay down the debt while neglecting any steps to curb global warming. We’ll be able to tell our children and grandchildren that they don’t have to pay interest on government bonds (they also won’t be receiving interest on government bonds, but let’s not complicate matters with logic) as they evacuate their homes ahead of flood waters. Undoubtedly they will be very thankful for this great benefit that we will have bestowed on them courtesy of the public-minded CEOs of the Campaign to Fix the Debt. In reality the Campaigners are spewing utter nonsense when they imply that the well-being of future generations will be in any way determined by the size of the government debt that we pass on to them. We hand down to future generations a whole society and a planet that will be damaged to varying degrees depending on our current actions. Neglecting the steps necessary to fix the planet out of a desire to reduce the deficit is incredibly irresponsible if we care about future generations...

MORE

[xchrom]

14. i see you...

[Demeter]

21. Not much to look at

I'm feeling rather blurry, despite crashing into bed early. Got a busy day ahead...so keep on posting!

[xchrom]

24. well i hope it's a good busy...

[xchrom]

15. AS EUROZONE ECONOMY SHRINKS, GOV'T DEBT LOADS GROW

http://hosted.ap.org/dynamic/stories/E/EU_EUROPE_ECONOMY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-11-17-02-39-59

FRANKFURT, Germany (AP) -- Europe's government-debt crisis is no longer panicking financial markets. But it won't end until the region's economy starts growing strongly again.

And that will be a while.

The economy of the 17 countries that use the euro has shrunk for two straight quarters - a common definition of a recession - and analysts forecast little or no growth until 2014.

Without growth, there won't be enough tax revenue to help countries like Greece, Italy, Spain and Portugal narrow their deficits and slow the expansion of their debts. Their debt burdens as a percentage of economic output, a key measure of fiscal health, look worse by the day.

The eurozone's combined debts are equal to about 93 percent of the region's gross domestic product this year and that figure is forecast to rise to peak at 94.5 percent next year. In 2009, the eurozone's debt-to-GDP ratio was 80 percent. A ratio above 90 percent is generally considered high and can put pressure on governments' borrowing costs.

GASP -- you don't say?!?

[xchrom]

16. 2 YEARS AFTER IPO, GM IS PILING UP CASH

http://hosted.ap.org/dynamic/stories/U/US_GENERAL_MOTORS_IPO_ANNIVERSARY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-11-16-18-08-24

DETROIT (AP) -- Two years after a wounded General Motors returned to the stock market, the symbol of American industrial might is thriving again.

Sunday marks the anniversary of GM's initial public stock offering in November 2010. The company has made money for 11 straight quarters, piling up more than $16 billion in profits. Its cars and trucks are selling for good prices. And sales are strong in China.

But there are signs of trouble. GM's U.S. sales, the prime driver of its profits, aren't rising as quickly as the overall market. There's been turmoil in the executive ranks, and the company is hemorrhaging cash in Europe.

Since the IPO, here are GM's achievements, struggles and question marks.

ACHIEVEMENTS:

BIG PROFITS: GM is making money - nearly $4 billion so far this year. Most of that came from the U.S., where GM cars and trucks are selling for almost 6 percent more than they did in January of 2011. The average selling price is $32,662, says the TrueCar.com auto pricing site. GM also is making good money in China and the rest of Asia, and it has turned around its money-losing South American operations with a host of new products.

[xchrom]

17. Industrial Production in U.S. Drops 0.4% on Sandy Effect

http://www.bloomberg.com/news/2012-11-16/industrial-production-in-u-s-drops-0-4-on-sandy-effect.html

Industrial production unexpectedly fell in October as superstorm Sandy disrupted output of goods from food to chemicals, adding to the woes of companies contending with cooling global demand.

Production at factories, mines and utilities dropped 0.4 percent after a revised 0.2 percent increase in September that was smaller than previously estimated, Federal Reserve data showed today in Washington. Economists projected a 0.2 percent gain, according to the median forecast in a Bloomberg survey.

Manufacturing, which makes up 75 percent of total production, slumped 0.9 percent and was little changed excluding the effects of the storm, the Fed said. Europe’s recession and slower growth in Asia risk stemming overseas orders, while sales of capital equipment falter as U.S. companies brace for the so- called fiscal cliff of federal spending cuts and tax increases.

“Manufacturing is pretty much treading water,” said Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc. in New York and the top-ranked forecaster on the U.S. economy, according to data compiled by Bloomberg. “There’s soft domestic demand and weakening export demand. The overall trend hasn’t changed much regardless of the storm.”

[Demeter]

18. From Tansy: The Artist is Evelyn Pickering de Morgan

"I recognized the painting instantly.

When I did a paper on her for a graduate class in about 2002, I emailed the de Morgan Centre in England and received a delightful reply. I have it in my notes here somewhere.

My professor, who taught "Women in Art," knew virtually nothing about her.

She was quite a remarkable woman, though also quite eccentric and sometimes not entirely in touch with reality. Apparently one autumn before she and husband William left to spend the winter in Italy (for William's health) they had acquired a kitten. Rather than taking it with them, they left instructions for its care by the servants back in England. Over the next few months, Evelyn received numerous notes regarding the enormous amount the kitty was eating and how expensive it was. Thinking the servants were exaggerating because they didn't like being bothered with the care of small animal, Evelyn ignored the matter. Upon their return to England, however, the matter could no longer be ignored, for what she had brought home as an adorable black kitten had turned into a full-grown black leopard.

The de Morgans were good friends with William and Janey Morris, too, and the rest of the Pre-Raphaelites."

[xchrom]

20. lovely

[xchrom]

19. Both sides appear upbeat on opening round of ‘fiscal cliff’ talks

http://www.washingtonpost.com/business/economy/fiscal-cliff-negotiations-to-begin/2012/11/16/f2c04f12-2faa-11e2-9f50-0308e1e75445_story.html

After a brutally divisive presidential campaign and two years of acrimony over the federal budget, the nation's leaders joined hands Friday and pledged fast and far-reaching action to tame the public debt and avoid economy-shaking tax hikes set to hit in January.

In a display of bipartisanship unseen since the GOP captured the House in 2010, Republican and Democratic leaders met for more than an hour with President Obama at the White House. They emerged unified, with a message of reassurance for nervous taxpayers and investors — though intense haggling over the shape of a deal is yet to come.

“I feel very good about what we were able to talk about in there,” Senate Majority Leader Harry M. Reid (D-Nev.) told reporters outside the White House, standing shoulder-to-shoulder with Republicans John A. Boehner (Ohio), the House speaker, and Mitch McConnell (Ky.), the Senate minority leader, as well as House Democratic leader Nancy Pelosi (Calif.). “We all know something has to be done. There is no more ‘Let’s do it some other time.’ We’re going to do it now.”

The usually sharp-tongued McConnell even praised Obama for his upcoming trip to Southeast Asia, although it will take the president away from Washington as policymakers rush to reach an agreement to avert $500 billion in tax hikes and automatic spending cuts that threaten to throw the nation back into recession early next year.

[Demeter]

22. I'd feel so much safer and confident

if they weren't talking at all, just fighting in the press....

[xchrom]

25. well -- since i have my doubts about this 'crisis' -- for me it's just another reason for democrats

to abandon a progressive position.

[Demeter]

23. Real Danger of “Obamacare”: Insurance Company Takeover of Health Care By Nomi Prins

http://www.nationofchange.org/real-danger-obamacare-insurance-company-takeover-health-care-1352648027

...The average cost for health insurance for a family is $15,745 per year vs. a median income of $50,502, or about half post-tax take-home pay. “Obamacare” is the name commonly used for the Patient Protection and Affordable Care Act (PPACA) of 2010. The very moniker is indicative of how name-and-image-centric our world has become; Medicare was never called “Johnsoncare” when President Johnson signed it into law in 1965 and Johnson was not exactly a man of small-personality. At any rate, Obamacare or the PPACA ranks as one of the most misrepresented issues from the campaign, by both sides of the ever-slimming aisle. The Tea-Party Conservative types get it embarrassingly wrong when they call it a “government takeover of health care.” Likewise, Progressive Obama-supporters are deluded in accepting it as the most sweeping healthcare reform since Medicare. (Side note: I wish the word ‘sweeping’ could be retired from politics until it actually means -sweeping.) Here’s why. The PPACA does nothing to restructure the health insurance industry, anymore than the Dodd-Frank Act restructures the banking industry. This means everything else it attempts to do, positive or negative, will be vastly overshadowed by an industry accelerating to morph itself into a acquisition machine in order to circumvent anything that even smells like a restriction, including laws that exist and ones to come.

How? By doing the same thing energy and telecom companies did after they were deregulated in 1996, and that banks did after they were summarily deregulated (after moving that way for decades) in 1999. They are merging, consolidating, eliminating competitors, and controlling their domain. They are manufacturing power. Investment bankers are roaming the world to exploit this hot new opportunity. That’s one reason insurance companies don’t even call themselves that anymore. Now, they are ‘managed health care’ companies. Call yourself a managed health care company, and you can buy everything from other insurance companies to hospitals to clinics to doctors. The more consolidation, the more fees bankers rake in, and the more premiums and medical reimbursements and health care procedures, each company can control.

The result of 1996 energy deregulation was a glut of crime-spawned bankruptcies like Enron. Likewise WorldCom led a pack of telecom degenerates in the production of tens of billions of dollars worth of accounting fraud. The final repeal of Glass-Steagall ignited a merge-fest of investment and commercial banks, their linkages ensuring that taxpayers, whose deposits have been protected since the New Deal, provide a safety-net upon which they can mint toxic assets loosely based on over-leveraged home mortgages, and engage in risky, speculative activity; big banks don’t go bankrupt when they fabricate values or lose big on stupid bets, they get federally subsidized in all sorts of ways.
You know who else is similarly too big to fail? The insurance industry. UnitedHealth Group, the nation’s largest health insurer covers 50% of the insurable population in over 30 states. Blue Cross-Blue Shield, covers 100 million people through a constellation of 38 sub-companies. They, and other insurance companies are growing in breadth. When companies consolidate, the result is less transparency, less competition, and more possibility for fraud and shady behavior. Every. Single. Time...Managed Health Care companies don’t just administer private, but government health insurance policies as well. The http://www.healthcare.gov website says that under the PPACA, the life of the Medicare Trust Fund will be extended to 2024 as a result of reducing waste, fraud, abuse, and slowing cost growth. President Obama promised to reduce Medicare fraud 50% by 2012 according to the site – but if he did, he forgot to mention it during the campaign period.

To supposedly combat price hikes, the PPACA calls for a new Rate Review program, wherein insurance companies must justify premium hikes of more than 10% to a state or federal review program. Given that banks aren’t supposed to hold more than 10% of the nation’s deposits in any one institution, and three do, this isn’t a comforting constraint...By January 2014, the PPACA will require insurance companies to list their prices on competitive exchanges. In Obama-theory, this is supposed to reduce premiums via competition. But what if, say, only three companies control nearly all of the premiums? Consider the fact that it costs the same $3 to extract your money from a Chase, Bank of America or Citigroup ATM (if you don’t get it directly from the firm you bank at.) They constitute a monopoly that defies anti-trust inspection (thank you, Department of Justice.) What incentive would any of them have to charge less? None. That’s why they don’t...While it is positive that the PPACA requires coverage of people with pre-existing conditions and prohibits lifetime caps, it can’t control what people pay for insurance, because it doesn’t limit actual premiums, which have risen 13% on average since the Act was passed. The medical cost ratio limitation the PPACA instills; that 80% of premiums must be used for medical care in the case of individuals and small groups, and 85% in the case of large groups) to supposedly ensure companies operate on a more efficient premium in vs. premium out basis, is a joke. Its punch line is accounting manipulation. Call everything a medical cost; even buying another company, and the ratio is meaningless...WellPoint got that joke immediately. The largest for-profit “managed health care” company in the Blue Cross and Blue Shield Association, it began trading publicly on December 1, 2004. Depending on the state, it operates under Blue Cross and Blue Shield, Blue Cross or Anthem. After the PPACA was passed, in March 2010, WellPoint allegedly reclassified certain administrative costs as medical care costs in order to meet the law’s new medical loss ratio requirements (which requires insurers spend at least 80% or 85% of premiums on health care services, depending on the type of plan, individual or group respectively.) A month earlier, WellPoint announced its Anthem Blue Cross unit would raise insurance rates for some individual policies in California up to 39%. Federal and California regulators are still investigating this, but the premium hikes remained. WellPoint is also one of Wall Street’s favorite “managed health care” companies; cause it keeps getting bigger through acquisitions that pay hefty fees to the bankers involved. On October 23rd, WellPoint got approval from Amerigroup’s shareholders to acquire Amerigroup, a Medicaid-focused health insurer, in a $4.9 billion cash deal. The deal makes WellPoint the nation’s largest Medicaid insurer, and provides it greater access to Medicaid patients who also qualify for Medicare.

It was the largest cash deal ever, and the largest premium paid for a company in the managed health care realm...

EVER SO MUCH MORE AT LINK, NONE OF IT GOOD

WE DONE BEEN SOLD DOWN THE RIVER....THE IRONY! IT HURTS!

[xchrom]

26. Pension Benefit Guaranty Corp. running $34 billion deficit

http://www.washingtonpost.com/business/economy/pension-benefit-guaranty-corp-running-34-billion-deficit/2012/11/16/7c1a54da-303a-11e2-9f50-0308e1e75445_story.html

The federal agency that insures pensions for 43 million Americans saw its deficit swell to $34 billion in the past year, the largest in its 38-year history.

In its annual report released Friday, the Pension Benefit Guaranty Corp. blamed the growing shortfall on its inability to charge private employers adequate premiums for insuring pensions.

Citing the increasing deficit, PBGC Director Joshua Gotbaum called on Congress to give the agency power to set its own premiums. “We continue to hope that PBGC can have the tools to set its own financial house in order, the way other government and private insurers do,” he said in a statement.

The Obama administration has called on Congress to give PBGC’s board the power to set premiums. But those efforts have been unsuccessful, in large part because some members of Congress say that a new premium structure could significantly raise costs for companies whose retirement funds already are at risk of running out of money. Although Congress has raised PBGC premiums repeatedly in the past, they have not gone up in recent years.

[xchrom]

27. New Studies: Austerity Is Crushing, Not Saving, Europe

http://www.commondreams.org/headline/2012/11/16-1


BERLIN - The austerity programmes being rolled out in virtually every member state of the European Union (EU) – particularly in Greece, Portugal, Spain and Italy – have failed to reach their stated objective of consolidating public finances in order to solve sovereign debt crises.

Instead, these programmes – which entail massive public spending cuts in sectors such as education, health and governance – are “leading to collective folly” and even to “a social breakdown” across the continent, according to numerous economic experts.

Far from solving the debt crisis, as promised, the current fiscal consolidation plans will result in higher debt-GDP ratios in the EU in 2013, according to recent research.

Several reports have now confirmed what economists and activists warned months and even years ago: that the economic crisis, triggered by the financial collapse of 2007-2008 and the subsequent state-sponsored bailout of banks and investment funds, has resulted in higher unemployment and poverty rates in every country.

[Demeter]

28. Don't Fall for the Right's "Fiscal Cliff" Hysteria

http://www.alternet.org/dont-fall-rights-fiscal-cliff-hysteria?akid=9689.227380.-i-5Dn&rd=1&src=newsletter745744&t=14


They’re up to it again – this time with what they call the “fiscal cliff.” Beware of con men bearing slogans. The oldest trick in the book is for conservatives – cons – to create hysteria around something, and then get all of us to give them billions of our tax dollars to fix the problem they’ve gotten us all hysterical about. Four generations ago, the right was whipping up hysteria about Reefer Madness. They got us to spend trillions over the years incarcerating mostly poor people for a mostly victimless crime. But they made a fortune doing it! And now they’re even building private prisons to hold potheads. Three generations ago, the right was whipping up hysteria about Communism. Although Khrushchev never actually said, “We will bury you,” right-wingers and their PR machine made sure every American thought he did. And the Red Chinese were going to take down Vietnam and that domino would flip other countries from Laos to Canada – and pretty soon North Dakota would be filled with commies. They got us to spend trillions over the years building nukes and having pointless wars. But they made a fortune doing it! And now that they’re making money partnering with China, they’d like us to forget that it’s still officially a communist country. No droids in this car!

Two generations ago, the right was whipping up hysteria about taxes and regulation. Reagan told us that – even though the decades of the 50s, 60s, and 70s had been among the strongest in American history in terms of GDP growth and growth of the middle class – still, taxes on rich people were so high, and regulation of industry was so bad, that if we didn’t do something about it now, disasters would happen. They got us to spend trillions giving tax breaks to billionaires, and deregulated giant corporations so they could destroy most small and medium-sized American businesses in the great Mergers and Acquisitions frenzy. But they made a fortune doing it! And in this generation, the right is whipping up hysteria about our national debt.

They want us to be afraid, very afraid, that because of their war on drugs, their war on communism, and their war on taxes and regulation, our country now is trillions of dollars in debt. It becomes particularly ironic when they get hysterical about a program that goes into effect at the end of this year that will modestly raise taxes back to where they were when Bill Clinton was president, and will cut spending, particularly military spending, although not even close enough to take us back to where it was before Bush. They call this the “fiscal cliff,” as if it’s something we could fall over the edge of and die from the crash. But it’s all hysteria. The tax increases on middle class people are easily remedied with a tax cut – something Republicans say they love. And the spending cuts sound like a lot – over a trillion dollars – but that’s over the next ten years. That’s plenty of time to go through those things and decide which is important, like keeping long-term unemployment benefits flowing, and which can wait, like building more bombs. In other words, the “fiscal cliff” is another classic example of what Naomi Klein called “Disaster Capitalism.” Create a panic, and then profit from it. For example, Wall Street is helping fund groups like the Third Way that are pushing hard for us to give our Social Security Trust Fund – which has over two and a half trillion dollars in it – to Goldman Sachs and Citibank so they can take care of it for us. Doesn’t that make you feel all safe, and warm-and-fuzzy? While we have a large debt, it’s not as large as it was after World War II. And how did we solve it then? Presidents Truman and Eisenhower – a Democrat and a Republican – both realized it wasn’t a “cliff” or a debt problem: it was a jobs problem. So they invested billions of dollars in sending millions of Americans to college for free, and billions more in building highways, schools, and hospitals. Those investments paid off in more and better jobs, which meant more taxpayers, which meant more tax revenue.

As if by magic, the World War Two debt was paid off! We need to change the conversation. We don’t have a “fiscal cliff” to worry about – we have a jobs cliff. Giant corporations and their conservative buddies have been sending those jobs overseas as fast as they can, and, while it’s making the fat cats rich, it’s wiping out the middle class. It’s time for a national conversation about our insane trade policies and how we can grow real jobs, not just fast-food jobs. No fiscal cliff or grand bargain needed – let’s just put Americans back to work.

*************************************************************

Thom Hartmann is an author and nationally syndicated daily talk show host. His newest book is The Thom Hartmann Reader.

[Demeter]

29. Why Jobs Should be Obama’s Top Priority -- Not Suicidal Austerity By William K. Black

http://www.alternet.org/news-amp-politics/why-jobs-should-be-obamas-top-priority-not-suicidal-austerity?akid=9689.227380.-i-5Dn&rd=1&src=newsletter745744&t=16

President Obama gave a major speech this week on his legislative agenda. He said that the overriding national priority had to be jobs. We agree.

David Brooks’ November 8, 2012 column called on the Republican Party to become “The Party of Work.” He put his primary message in his final paragraph for emphasis:

“Don’t get hung up on whether the federal government is 20 percent or 22 percent of G.D.P. Let Democrats be the party of security, defending the 20th-century welfare state. Be the party that celebrates work and inflames enterprise. Use any tool, public or private, to help people transform their lives.”

Other than the gratuitous and inaccurate slap at the Democratic Party, we agree. The problem is that Republicans and Democrats are pushing a “Grand Bargain” that would reduce jobs. (The so-called Grand Bargain would also produce a “Great Betrayal” that would begin the process of shredding the safety net.)

...Guess who insisted on creating the fiscal cliff and ensuring that it had a “trigger” that made it automatic absent a Great Betrayal? That would be Obama – with the full support of the Republicans. Obama insisted on mandating austerity, particularly cuts in Medicaid and Medicare, if austerity failed. That was significantly insane economically and politically. The people who caused the insanity now tell us we must end their insane austerity – by adopting the Great Betrayal and its austerity. “Incoherent” does not begin to capture the incoherence of both parties on austerity...

[Fuddnik]

33. The Austerity Bomb.

One economist on Spitzers show used it the other night, and Elliot has been using it ever since. I like it.

"Fiscal Cliff" is meant to scare people. "Austerity Bomb" calls it what it really is.

Now, if Dems in Congress would learn how to use language like repukes.......

[xchrom]

30. Prison of Debt Paralyzes West

http://www.spiegel.de/international/business/playing-poker-with-trillions-a-prison-of-debt-on-both-sides-of-the-atlantic-a-867404.html


"A Bigger Bank," by Justine Smith, banknotes on paper.

In the midst of this confusing crisis, which has already lasted more than five years, former German Chancellor Helmut Schmidt addressed the question of who had "gotten almost the entire world into so much trouble." The longer the search for answers lasted, the more disconcerting the questions arising from the answers became. Is it possible that we are not experiencing a crisis, but rather a transformation of our economic system that feels like an unending crisis, and that waiting for it to end is hopeless? Is it possible that we are waiting for the world to conform to our worldview once again, but that it would be smarter to adjust our worldview to conform to the world? Is it possible that financial markets will never become servants of the markets for goods again? Is it possible that Western countries can no longer get rid of their debt, because democracies can't manage money? And is it possible that even Helmut Schmidt ought to be saying to himself: I too am responsible for getting the world into a fix?

The most romantic Hollywood movie about the financial crisis isn't "Wall Street" or "Margin Call," but the 1995 film "Die Hard: With a Vengeance." In the film, an officer with the East German intelligence agency, the Stasi, steals the gold reserves of the Western world from the basement of the Federal Reserve Bank of New York and supposedly sinks them into the Hudson River. Bruce Willis hunts down the culprit and rescues the 550,000 bars of gold, which, until the early 1970s, were essentially the foundation on which confidence in all the currencies of the Western world was built.
Creating Money out of Thin Air

Until 1971, gold was the benchmark of the US dollar, with one ounce of pure gold corresponding to $35, and the dollar was the fixed benchmark of all Western currencies. But when the United States began to need more and more dollars for the Vietnam War, and the global economy grew so quickly that using gold as a benchmark became a constraint, countries abandoned the system of fixed exchange rates. A new phase of the global economy began, and two processes were set in motion: the liberation of the financial markets from limited money supplies, which was mostly beneficial; and the liberation of countries from limited revenues, which was mostly detrimental. This money bubble continued to inflate for four decades, as central banks were able to create money out of thin air, banks were able to provide seemingly unlimited credit, and consumers and governments were able to go into debt without restraint.

This continued until the biggest credit bubble in history began to burst: first in the United States, because banks had bundled the mortgages of millions of Americans, whose only asset was a house bought on credit, into worthless securities; then around the globe, because banks had foisted these securities onto customers in many countries; and, finally, when these banks began to totter, debt-ridden countries turned private debt into public debt until they too began to totter, and could only borrow money from banks at even higher interest rates than before.

[Demeter]

36. German Hysteria From An Economic Idiot

This is a great example of the European equivalent of the Tea Party....

[xchrom]

31. Judges slam royal decree on stemming evictions as inadequate{spain}

http://elpais.com/elpais/2012/11/16/inenglish/1353098560_658576.html

The country’s three main judge associations on Friday called the government eviction decree “arbitrary” and “absolutely insufficient.”

Magistrates criticized the fact that while the Popular Party administration is calling a two-year moratorium on evictions for the most vulnerable people, it does nothing to reform mortgage legislation, effectively providing a temporary solution to a long-term problem.

José María Fernández Seijo, the judge at Barcelona’s third Mercantile Court, said the decree avoids the core of the problem. The conditions for eligibility to the moratorium also include senseless discrimination, the associations said.

The decree sets stringent requirements. Those eligible must make no more than 19,200 euros a year and spend over 50 percent of their household income on the mortgage. Households with three children are automatically eligible, but those with two are not. “Do those two children not have the same right not to be thrown out on the street?” asks Judge María Teresa Sáez, president of the Professional Magistrate Association. “We lament that the conditions are not more flexible to give us some margin to interpret whether a case is critical.”

[xchrom]

32. Spain faces cut in EU budget allocation of 20 billion euros

http://elpais.com/elpais/2012/11/16/inenglish/1353093553_090230.html

A new blow at the height of the crisis: Spain looks set to lose around 20 billion euros in European Union budget allocations from 2014 to 2020 compared with the previous seven-year period, according to diplomatic sources familiar with the negotiations.

For the first time, Spain will be a net contributor to European coffers, most likely during that entire period.

The news is all the more striking because it comes in the middle of Spain’s economic crisis, with GDP contractions of around 1.5 percent expected this year and the next, unemployment hovering at 25 percent and rising fast, and the long shadow of a second bailout looming over Madrid.

However, the 20-billion-euro budget cut is not a done deal. Just a week away from a EU summit, its 27 member countries are still far from reaching an agreement. Figures could change depending on the reference period used for calculations: either figures from 2009 and 2010, when the crisis was not quite so acute, or the more recent data that Spain is lobbying to use. But this will require further negotiations, and diplomatic sources said it is unrealistic to expect significant improvement on that front.

[Demeter]

34. THEY....ARE....INSANE!

What kind of souless adding machines run the EU anyway? I used to look upon Europe with envy. I think I've been cured of that. They have everything to lose and everything at risk.

We in the US STILL have everything to gain...and the means to do so. If we are canny enough to slit the throats, cut off the hands, and roast the feet of the 1%, while refurbishing the dignity of the Common People.

[xchrom]

39. ...

[Demeter]

35. Doonesbury

http://assets.amuniversal.com/89a04f700b560130fb37001dd8b71c47?width=900.0

[Demeter]

37. Mark Fiore--Cliff Diving with Newly Frugal Guy

http://www.dailykos.com/story/2012/11/16/1161821/-Cliff-Diving

[Demeter]

38. Mark Fiore--Big Secret Bucks

&feature=plcp

[Tansy_Gold]

40. When the Nerds Go Marching In --

Long article, but very interesting, in the coolest of Arte Johnson ways.


http://www.theatlantic.com/technology/archive/2012/11/when-the-nerds-go-marching-in/265325/

How a dream team of engineers from Facebook, Twitter, and Google built the software that drove Barack Obama's reelection


. . .


They'd been working 14-hour days, six or seven days a week, trying to reelect the president, and now everything had been broken at just the wrong time.And that was the point. "Game day" was October 21. The election was still 17 days away, and this was a live action role playing (LARPing!) exercise that the campaign's chief technology officer, Harper Reed, was inflicting on his team. "We worked through every possible disaster situation," Reed said. "We did three actual all-day sessions of destroying everything we had built."

Hatch was playing the role of dungeon master, calling out devilishly complex scenarios that were designed to test each and every piece of their system as they entered the exponential traffic-growth phase of the election. Mark Trammell, an engineer who Reed hired after he left Twitter, saw a couple game days. He said they reminded him of his time in the Navy. "You ran firefighting drills over and over and over, to make sure that you not just know what you're doing," he said, "but you're calm because you know you can handle your shit."


. . .

We knew what to do," Reed maintained, no matter what the scenario was. "We had a runbook that said if this happens, you do this, this, and this. They did not do that with Orca."

THE NEW CHICAGO MACHINE vs. THE GRAND OLD PARTY

Orca was supposed to be the Republican answer to Obama's perceived tech advantage. In the days leading up to the election, the Romney campaign pushed its (not-so) secret weapon as the answer to the Democrats' vaunted ground game. Orca was going to allow volunteers at polling places to update the Romney camp's database of voters in real time as people cast their ballots. That would supposedly allow them to deploy resources more efficiently and wring every last vote out of Florida, Ohio, and the other battleground states. The product got its name, a Romney spokesperson told NPR , because orcas are the only known predator of the one-tusked narwhal.



******************

Thanks to FarCenter for posting this in GD
http://www.democraticunderground.com/10021837617

[Demeter]

41. Karl Rove Loses Election After Being Checkmated By Cyber Sleuths?

http://occupyforaccountability.org/index.php?q=node/1075

THIS POST IMPLIES THAT THE EFFORT WAS MUCH BIGGER THAN THAT....

Last month, we offered a million dollar reward for information leading to the arrest and conviction of anyone who rigged a federal election on November 6th. We urged computer experts to contact us with information about any election manipulation of the tabulation results.

We Received A Letter

On November 12th, we received a letter from “The Protectors,” apparently a group of white hat cyber sleuths, mentioning our reward and stating that two months ago, they began monitoring the “digital traffic of one Karl Rove, a disrespecter of the Rule of Law, knowing that he claimed to be Kingmaker while grifting vast wealth from barons who gladly handed him gold to anoint another King while looking the other way.”

“The Protectors” said that they had identified the digital structure of Rove’s operation and of ORCA, a Republican get out the vote software application. After finding open “doors” in the systems, they created a “password protected firewall” called “The Great Oz,” and installed it on servers that Rove planned to use on election night to re-route and change election results “from three states.”

The letter indicated that “ORCA Killer” was launched at 10am EST and “The Great Oz” at 8pm EST on November 6th. “The Protectors” watched as ORCA crashed and failed throughout Election Day. They watched as Rove’s computer techs tried 105 times to penetrate “The Great Oz” using different means and passwords.

Finally, they issued the following warning to Mr. Rove: don’t do it again or they would turn over the evidence to Wikileaks founder Julian Assange...

[Demeter]

42. SEE ALSO

http://www.velvetrevolution.us/images/Anon_Rove_Letter.pdf

[Demeter]

43. The Deficit Crisis Mongers Go Off the Deep End By Dean Baker

http://www.nationofchange.org/print/32526

Washington elites have spent much of the last three decades getting hysterical about budget deficits; however they are outdoing themselves in the current budget standoff which they labeled as “the fiscal cliff.” Their story is that scheduled increases in taxes at the end of 2012, coupled with mandated cuts in spending, will send the economy tumbling into recession if Congress doesn’t take action before the end of the year. The horror story associated with this January 1 deadline depends on fundamentally misrepresenting reality. There are projections from the Congressional Budget Office and other independent forecasters that show the combination of tax increases and spending cuts would chop more than 3.5 percentage points off GDP growth. This hit would mean a contracting economy and push the unemployment rate back over 10.0 percent.

However, the part is generally downplayed in this genuine horror story, or left out altogether, is that the projection of a recession is not based on missing the January 1 deadline. The projection assumes that the higher tax rates and lower spending levels are left in place throughout the year, a scenario that almost no one considers plausible. A more realistic scenario would be that Congress and the president would quickly reach an agreement in the new year, extending most of the tax cuts and limiting the decline in spending. This would mean that some people may see some extra taxes deducted from a paycheck or two, but they would get this money refunded to them in subsequent checks. The predicted effect on consumption would be close to zero.

On the spending side, President Obama has enormous control over the pace of spending. If he believes that a deal is imminent, there is no reason for him to cut spending below a pace that would be consistent with the amount that he expects to agree to with Congress. In other words, the direct hit to the economy from missing the January 1 deadline is close to zero. However, the deficit crisis mongers are a persistent bunch. If they can’t make a case based on economics, they turn to their good friend the confidence fairy. The story presented to us in a column in the Washington Post was that business people will get freaked out if there is no deal by January 1 and that financial markets will panic. New York Times columnist David Brooks pushed the same line in a column earlier in the week. This sort of warning, coming from people who have a near-perfect track record in being wrong on everything they say about the economy, would ordinarily be laughable. Unfortunately, these warnings come from people who have prominent positions in national policy debates. Therefore it is likely that such warnings will be taken seriously.

The deficit hawks want to promote a sense of crisis because it is essential to advancing their agenda. If the January 1 deadline passes, the political ground shifts to those who just want to see an end to the Bush tax cuts for the wealthy. After January 1, the Bush tax cuts will have expired. This means that when President Obama pushes his campaign pledge to keep in place the Bush tax cuts for 98 percent of households, he will be asking Congress to lower taxes for 98 percent of the people, not to raise them for 2 percent. It would be difficult even for a Republican Congress to refuse this tax cut. The deficit hawks desperately want to avoid this outcome, both because many do not want to see taxes rise on the wealthy, but also because they see a crisis over this fiscal standoff as providing an excellent opportunity to cut Social Security and Medicare. For this reason, the deficit hawks are doing everything they can to convince the public that waiting until after January 1 to reach a deal would be an economic disaster. Of course none of us can predict the future with certainty, which means it is possible that the financial markets really will panic and economy will tumble if we miss the January 1 deadline. However, in addition to the horrible track record of the crisis crew, there is another important consideration to keep mind. The immediate impact of fluctuations in financial markets on the economy is quite limited. The economy does not respond to the daily ups and downs of the stock market. Even the crash of October 1987 did not prevent the economy from growing at a 7.0 percent annual rate in the fourth quarter of the year. This means that if the markets are in fact dominated by Chicken Littles who run for cover if the January 1 deadline is missed, then it is likely that more sober-minded investors will restore stability in the next month or two after a deal is reached and the world is still standing. The net effect on the economy is likely to be minimal, even if some fortunes may have been made and lost with the volatility.

The real bottom line is whether the country will allow the deficit hawks to scare us into a deal that we would never make under normal circumstances. We’ll know the answer to this one in six weeks.

[Demeter]

44. Why BP Isn’t a Criminal By Robert Reich (HINT: YOU HAVE TO BE A HUMAN BEING)

http://www.nationofchange.org/why-bp-isn-t-criminal-1353162629

Justice Department just entered into the largest criminal settlement in U.S. history with the giant oil company BP. BP plead guilty to 14 criminal counts, including manslaughter, and agreed to pay $4 billion over the next five years. This is loony. Mind you, I’m appalled by the carelessness and indifference of the BP executives responsible for the disaster in the Gulf of Mexico that killed eleven people on April 20, 2010, and unleashed the worst oil spill in American history.

But it defies logic to make BP itself the criminal. Corporations aren’t people. They can’t know right from wrong. They’re incapable of criminal intent. They have no brains. They’re legal fictions — pieces of paper filed away in a vault in some bank. Holding corporations criminally liable reinforces the same fallacy that gave us Citizen’s United v. the Federal Election Commission, in which five justices decided corporations are people under the First Amendment and therefore can spend unlimited amounts on an election. Even if 49 percent of their shareholders are foreign citizens, corporations now have a constitutional right to affect the outcome of American elections.

We don’t know exactly how much corporate money was spent on the last election but it’s a fair guess that were it not for Citizen’s United, the House of Representatives might now be under control of Democrats, and Senate Democrats might have a filibuster-proof majority. The perfidious notion that corporations are people can lead to even more bizarre results. If corporations are people and they’re headquartered in the United States, then presumably corporations are citizens. That means they have a right to vote as well.

I’ll believe corporations are people when Texas executes one.

Can we please get a grip? The only sentient beings in a corporation are the people who run them or work for them. When it comes to criminality, they’re the ones who should be punished. Punishing corporations as a whole almost always ends up harming innocent people – especially employees who lose their jobs because the corporation has to trim costs, and retirees whose savings shrink because their shares in the corporation lose value. Remember the accounting firm Arthur Andersen, convicted in 2002 of obstruction of justice when certain partners destroyed records of the auditing work they did for Enron as the energy giant was imploding? After the firm was convicted, its clients abandoned it and the firm went under. The vast majority of its employees had nothing to do with Enron but lost their jobs anyway. Yet the real perpetrators came out fine. Anderson’s CEO moved to a lucrative job in a private-equity firm, and other senior partners formed a new accounting firm. Likewise, the people responsible for BP’s deaths and oil spill weren’t BP’s rank-and-file employees or its shareholders. They were the executives who turned a blind eye to safety while in pursuit of their own rising stock options, and who conspired with oil-services giant Halliburton to cut corners on deep water drilling when they knew damn well they were taking risks for the sake of fatter profits. They’re the ones who should be punished. Failure to punish them simply invites more of the same kind of criminal negligence by executives more interested in lining their pockets than protecting their workers and the environment. (Today brought another tragedy in the Gulf when an oil rig exploded off the Louisiana coast — killing at least two workers and sending four others to hospitals Friday while two others were believed to be missing.)

But the Justice Department’s criminal settlement with BP gives these top executives a free pass — allowing the public to believe justice has been done.

MORE

[Demeter]

45. Why Credit Unions? (#OWS) Cathy O'Neil, mathbabe

http://mathbabe.org/2011/10/23/why-credit-unions-ows-part-1/

This is a guest post by FogOfWar. See also the “Credit Unions in NYC flyer“.

Moving your money from a megabank to a credit union or community development bank makes for a good sound bite, but is it really an action that can have an impact in the right direction? I think so (although the matter is not free from doubt), and thought it would be worthwhile to lay out thoughts on the subject as a follow-up to the “What is a Credit Union?” post.

I’ll focus this discussion on credit unions, rather than community development banks or smaller locally owned banks as that’s where my knowledge lies.
Credit Unions are not Too Big To Fail

A quick google search indicates the largest credit union in America is Navy FCU with $34Bn in assets. (Internationally, it may be the Dutch Rabobank, although I’ve never gotten a good handle on whether Rabo is still a cooperative or not.) Individual credit unions fail regularly, just like individual banks, but there isn’t one CU that’s in danger of crashing the entire financial system in the same manner as BAC, C, JPM or WF.

During the 2008 crisis and aftermath the only credit unions that got a federal bailout were the corporate credit unions. There’s a good article about that here. The corporate credit unions definitely got into trouble buying structured products and I don’t want to gloss this fact over. There’s a split between the retail credit unions, who are going to have to pay for these mistakes, and the corporate credit unions which made the bad investments as well as the NCUA, who was asleep at the switch when the corporate CUs were making that investment. Also worth noting that the NCUA has filed suit against the banks for selling crap product to the corporate CUs.

The corporate credit union bailout was small proportionate to the overall credit union size. $30 bn of gov’t backed bonds equates to $270 bn proportionate for banks—less than ½ of the official state of TARP and a small fraction of the overall size of the taxpayer support given to the large (non-CU) banks indirectly through TAF, TSLF, PDFC, TARP, TALF, etc.,… (see this for an explanation of term).

All in all, I’d say CUs come out somewhat ahead by this measure.
Volker Rule/Glass Steagall

Unlike commercial banks, credit unions never revoked the Glass Steagall act and remained segmented as “pure” traditional banking entities. This means that CUs don’t mingle traditional banking (deposits, checking accounts, loans to customers), with investment banking activities (IPOs, M&A advisory) or derivatives trading or sales desks, let alone prop desk frontrunning of client information.

There’s a lot of ink out there on Volker and Glass Steagall. In short, it seems like a good idea, if not sufficient as a complete solution, to keep traditional banking segmented from investment banking and proprietary trading. The core point is that trading risk should not infect the core banking business putting it (and the taxpayer standing behind the federal deposit insurance) at risk. Very good recent example of this here.

CUs come out dramatically ahead on this measure.
Lobbying—just as bad?

Credit Unions do lobby, largely through two groups, CUNA and NAFCU. In fact, NAFCU has been an opponent of the CPFB, and the CU lobby got itself removed from the debit swipe fee cap.

There was a time I can remember when CUNA and NAFCU just went up to the hill to remind Congress that they existed and defend against the ABA’s occasional attempts to change the tax status of CUs. It seems times have, rather unfortunately, changed.

Regrettably, no advantage to Credit Unions here.

Part 2 will talk about investments in local communities, democratic control (the good, the bad and the ugly) and securitization/mortgage transfers.

LINKS AT ORIGINAL POST

[Demeter]

46. San Diego's drone industry doubles in size

http://www.nctimes.com/news/science/san-diego-s-drone-industry-doubles-in-size/article_81e5b68e-ca71-5a81-8553-3c9603d415ea.html

The size of San Diego County’s unmanned aerial vehicle industry doubled over the past five years and could double again as UAVs are increasingly used for everything from spying on suspected terrorists abroad to monitoring the U.S.-Mexico border, says a National University System report released Wednesday.

The industry, which is centered in North County, generated at least $1.3 billion locally in 2011 and directly and indirectly supported 7,135 jobs. The report says the true impact could be far higher due to classified programs that are not included in public records.

Most of the business can be tied to two defense giants — Northrop Grumman of Rancho Bernardo, which specializes in Global Hawk UAVs, and General Atomics Aeronautical Systems of Poway, which is best-known for Predators.

Both companies develop a variety of the so-called drones, primarily for use outside the U.S. by the military and government. The UAVs were extensively used in the Iraq war, and are being used in the ongoing conflict in Afghanistan. But the UAVs may soon also be used domestically by law enforcement and other agencies, a move that is opposed by many privacy advocates.

Analysts say the global market for such aircraft could exceed $12 billion by 2019.

MORE

[Demeter]

47. 10 Filthy-Rich, Tax-Dodging Hypocrites Pushing Disastrous Austerity on America

http://www.ips-dc.org/articles/10_filthy-rich_tax-dodging_hypocrites_pushing_disastrous_austerity_on_america

“Fix the Debt ” is a coalition of more than 80 CEOs who claim they know best how to deal with our nation’s fiscal challenges. The group boasts a $60 million budget just for the initial phase of a massive media and lobbying campaign.

The irony is that CEOs in the coalition’s leadership have been major contributors to the national debt they now claim to know how to fix. These are guys who’ve mastered every tax-dodging trick in the book. And now that they’ve boosted their corporate profits by draining the public treasury, how do they propose we put our fiscal house back in order? By squeezing programs for the poor and elderly, including Social Security, Medicare, and Medicaid.

Fix the Debt claims their agenda is not just about spending cuts. But when it comes to their tax proposals, they use the slippery term “pro-growth reform” to push for cuts in deductions that are likely to include credits for working families and — you guessed it — more corporate tax breaks. Chief among these is a proposal to switch to a territorial system under which corporate foreign earnings would be permanently exempted (instead of being taxed when they are returned to America).

This idea, also supported by the Bowles-Simpson deficit commission, would make it even more profitable for big corporations to use accounting tricks to disguise U.S. profits as income earned in tax havens. Citizens for Tax Justice estimates that such tax haven abuse will cost the Treasury more than $1 trillion over the next decade....MORE

1. Jeffrey Immelt, General Electric
2. Jim McNerney, Boeing
3. Lloyd Blankfein, Goldman Sachs
4. Brian T. Moynihan, Bank of America
5. David Cote, Honeywell Corporation
6. Randall Stephenson, AT&T
7. Arne Sorenson, Marriott International
8. Alexander Cutler, Eaton Corporation
9. Lowell McAdam, Verizon
10. Steve Ballmer, Microsoft

[Demeter]

48. Is The World Abandoning The U.S. Economy? By Brandon Smith

http://www.alt-market.com/articles/1108-is-the-world-abandoning-the-us-economy

Go to any university, any center of equities trade, any meeting place for financial academia, any fiscal think tank, and they will tell you without the slightest hint of doubt in their eyes that the U.S. economy is essential to the survival of the world. To even broach the possibility that the U.S. could be dropped or replaced as the central pillar of trade on the planet is greeted with sneers and even anger. But let’s set aside what we think (or what we assume) we know about the American financial juggernaut and consider the sordid history of the money powerhouse myth.

Germany, especially in the decade leading up to WWI, was an industrial giant, rivaling Britain in the production of raw commodities like steel, as well as the banking envy of the world. I’m sure very few economists of the era would have given any credence to the idea that the German foundation would in the near future collapse into hyperinflationary ruin. However, that is exactly what it did. In the span of 10 to 15 years, Germany was completely supplanted as the shining beacon of economic prosperity, never to return to a similar glory....The British Empire from WWII up until the late 1950’s was the primary force in the global trade of oil, and the pound-sterling was dominant in the export and import of raw petroleum between nations. Extreme debt obligations and draining interventions in the Middle East set Britain on the path to currency devaluation, and the loss of its coveted reserve status. The point is, there is no such thing as an invincible economy, especially if it is predicated on overt debt creation, fiat printing, and reckless foreign policy. When it comes down to the raw data, the American system is just as fragile as any corrupt third world shanty-town nation.

The possibility of a U.S. without financial hegemony is very real. To understand that this possibility exists is one thing; to understand that the process of destabilization has already begun is another. Many analysts with their heads stuck in the mainstream clouds attempt to argue against the “theory” of foreign markets decoupling from the U.S., not realizing that their entire debate platform is pointless because the decoupling is happening right under their noses… The recent press covering the ongoing plan by BRIC nations (or “BRICS” if you count the latest bilateral agreements with South Africa) to establish their own supranational banking hub merely highlights the fact that developing countries are not simply “talking” about decoupling from the United States, they are taking actions to make it happen:

http://www.bloomberg.com/news/2012-10-16/goldman-sachs-s-o-neill-sees-brics-bank-gathering-momentum-1-.html

The response from mainstream financial analysts is, of course, that the project for a BRIC bank will fail. Their argument, however, usually revolves around the assumption that this new central bank is designed to “compete” with the IMF, and is a merely an overreaction to the IMF and World Bank’s failure to give developing nations more inclusion in decision making processes. I see no evidence that the BRICS are trying to create a counter-system which would conflict with IMF control. Instead, it would seem that the BRICS are much more interested in forcing the issue of greater inclusion, and garnering greater favor within the already existing IMF structure:

http://www.reuters.com/article/2012/04/19/imf-idUSL2E8FJ90K20120419

Last year the G20 discussed heightened participation by China and the BRICS in the IMF’s global basket currency, the SDR. French Finance Minister and later “elected” IMF chief Christine Lagarde agreed with the idea while stating that certain conditions, including appreciation of the Yuan’s value, would have to take place:

http://www.bbc.co.uk/news/business-12905205

Contrary to the belief that the BRICS are building opposition to the IMF, China has on several occasions called for the EXPANSION of the IMF’s power, as well as widespread circulation of the SDR:

http://www.businessweek.com/news/2011-11-03/chinese-president-hu-calls-for-reform-of-imf-sdr-currency-basket.html

How have the MSM talking heads missed this trend? Simply put: Bias, controlled and pre-written talking points from their editors, as well as many half-baked presumptions. The popular belief amongst financial academia is that the IMF is a product of American economic might, and that the organization will do whatever is in the best interests of the U.S. at all times. The reality is that the IMF is fast becoming the central authority of economic operations around the globe, and America just happens to be paying the largest “tithe” to the respective coffers of the banking syndicate. Do you get more control in the operations of the IRS when you pay more taxes? The IMF’s goal is world centralization of economic control. For them, any sovereign nation is expendable in pursuit of the end game, including the United States. The IMF would not be pushing the issuance of a new world reserve currency to unseat the dollar if they did not intend to follow through, and they certainly would not hobble the greenback if they cared in the slightest about American economic concerns.

Rather than running counter to the IMF, BRIC partners and the newly realized ASEAN bloc are making themselves indispensible to the globalists, ensuring wider partnership in the near future. A BRIC central bank is, I believe, a bargaining chip to be used to open the door to more leadership in the IMF while reducing American influence. To summarize, the BRICS are not in conflict with the IMF, rather, they are in conflict with the U.S., and this conflict is coming to a climax…Trade amongst BRIC nations continues to climb while exports to the U.S. have diminished. Between 2001 and 2009, exports and imports between BRICS skyrocketed, even amidst the derivatives collapse:

http://www.bbc.co.uk/news/business-13046521

Last year, ASEAN overtook Japan as China’s third largest trading partner. With the announcement of increased participation by Japan in the ASEAN bloc this year, the economic body looks poised to eclipse the U.S. and perhaps even the EU as China’s primary source of export and import business:

http://www.channelnewsasia.com/stories/afp_asiapacific_business/view/1197997/1/.html

Meanwhile, overall exports around the world have dropped for five consecutive months in 2012 on slowing demand in the West. The expectation of a massive resurgence in consumer demand from the U.S. has been proven unfounded, while the recession in the EU is exacerbating the downturn. U.S. exporters, who not long ago held dreams of foreign buyers clamoring for goods in the midst of Federal Reserve inflation and dollar devaluation, have discovered that they are instead floundering:

http://www.nytimes.com/2012/10/23/business/global/chinas-slowing-economy-puts-pressure-on-american-exporters.html?pagewanted=all&_r=1&

The mainstream claim is that this is due to a breakdown in general Chinese demand, but with exponential bilateral trade deals (many of which cut out the U.S. dollar completely as a reserve currency) being made between China and major producing and consuming countries, it is clear that this is not just a demand issue in China; it is an ongoing process of removal of the U.S. from the trading picture. That is to say, China is deliberately reducing purchases of U.S. goods and turning towards BRIC and ASEAN partner countries to fill the void. This may be the reason why China recently surpassed the U.S. as the top sanctuary for foreign investment:

http://online.wsj.com/article/SB10001424052970203406404578074683825139320.html?mod=asia_home

A Treasury report on China’s status as a “currency manipulator” already due but now delayed until after the elections may become the catalyst for the final phase of the global shunning of American markets. With China being presented as a primary issue during the presidential debates, it would seem that regardless of who “wins” the election there will be strain applied to Chinese trade relations.

China’s incredible gold buying extravaganzas over the past few years (including an estimated 500 tons in 2011 and another 500 tons so far in 2012) indicate that they are indeed hedging against what they obviously expect will be devaluation in the dollar or multiple currencies around the world including the dollar. India continues its long tradition of gold buying, while Russia is now increasing its reserves by half-a-billion dollars a month. These are the actions of countries getting ready for a break in the financial system, not a recovery, and certainly not a return to the old days of American consumer bliss.

The argument over whether or not the BRICS and the rest of the world can drop the U.S. economy and move onward has, ultimately, been rendered obsolete. Many will claim that a decoupling is impossible, but the fact remains that a decoupling is taking place. The consequences of this fiscal divorce remain to be seen, and the mainstream could very easily predict disaster for the BRICS. The real question they should be asking themselves, though, is which countries are better placed to survive such an event? Is the U.S. economy really built to withstand a loss of the dollar as the world reserve currency? Is the U.S. prepared for plummeting foreign investment and a reduction in its already dismal production capacity (production taking place by Americans on American soil, that is)? Is the U.S. really ready for extreme inflation in imported goods (most of the goods we consume)? Who really needs who more? It is time for the pundits and average Americans alike to set aside their commercialized and subsidized fake patriotism and question how strong our economy truly is. To ignore vast weakness today, is to feel vast pain tomorrow…

*********************************************************

You can contact Brandon Smith at: [e-mail]
Alt-Market is an organization designed to help you find like-minded activists and preppers in your local area so that you can network and construct communities for mutual aid and defense.

[Demeter]

49. Wall Street Week Ahead: Going off "cliff" with a bungee cord

http://news.yahoo.com/wall-street-week-ahead-going-off-cliff-bungee-232345278--finance.html

The 1987 crash. The Y2K bug. The debt ceiling debacle of 2011.

All these events, in the end, turned out to be buying opportunities for stocks. So will the "fiscal cliff," some investors say as they watch favorite stocks tumble during the political give-and-take happening in Washington...

IS THE AUTHOR ADMITTING THAT THE FISCAL CLIFF IS YET ANOTHER HOAX DESIGNED TO SCARE PEOPLE INTO DOING FOOLISH THINGS?

I CAN'T BE BOTHERED TO READ FURTHER TO FIND OUT.

[Demeter]

50. IMF'S Lagarde says Greek deal should be "rooted in reality"

CHER CHRISTINE, WHY START NOW?

http://news.yahoo.com/imfs-lagarde-says-greek-deal-rooted-reality-160634730--finance.html

An agreement among Greece's international creditors on reducing its large debt pile should be "rooted in reality and not in wishful thinking," the head of the International Monetary Fund said ahead of a tense meeting with European leaders.

Cutting short a visit to Asia to attend a Eurogroup meeting on Tuesday in Brussels, Christine Lagarde, the IMF's managing director, told Reuters it was important that an agreement provide a lasting solution to Greece's debt to avoid prolonged uncertainty and further damage to the Greek economy.

"I am always trying to be constructive but I am driven by two objectives," she said in an interview, "to build and approve a program for Greece that is solid, that is convincing today, that will be sustainable tomorrow, that is rooted in reality and not in wishful thinking.

"The second objective is to maintain the integrity, credibility and quality of advice that we are giving, not for the Fund itself, which obviously is a concern of mine, but to lend that to the Europeans because that is what they are interested in," she said late on Saturday.

The IMF and euro zone governments are at loggerheads over how to reduce Greece's massive debt load, which is holding up the release of 31 billion euros in emergency loans to Athens.

[Demeter]

51. Why even President Obama won't champion social security Dean Baker

IF IT'S OBVIOUS TO THE BRITS, WHY IS IT SO HIDDEN TO AMERICANS?

http://www.guardian.co.uk/commentisfree/2012/oct/24/president-obama-social-security

It is remarkable that social security hasn't been a more prominent issue in the presidential race. After all, Governor Romney has proposed a plan that would imply cuts of more than 40% for middle-class workers just entering the labor force. Since social security is hugely popular across the political spectrum, it would seem that President Obama could gain an enormous advantage by clearly proclaiming his support for the program.

But President Obama has consistently refused to rise to the defense of social security. In fact, in the first debate, he explicitly took the issue off the table, telling the American people that there is not much difference between his position on social security and Romney's.

On its face, this is difficult to understand. In addition to being good politics, there are also solid policy grounds for defending social security. The social security system is perhaps the greatest success story of any program in US history. By providing a core retirement income, it has lifted tens of millions of retirees and their families out of poverty. It also provides disability insurance to almost the entire workforce. The amount of fraud in the system is minimal, and the administrative costs are less than one 20th as large as the costs of private-sector insurers.

In addition, the program is more necessary now than ever. The economic mismanagement of the last two decades has left the baby boomers ill-prepared for retirement – few have traditional pensions. The stock market crashes of the last 15 years have left 401(k)s depleted, and the collapse of the housing bubble destroyed much of their housing equity, which has always been the main source of wealth for middle-income families. It would be great if we had reason to believe that the generations that followed had better retirement prospects, but we don't. Even in good times, the 401(k) system does more to enrich the financial industry than to provide a secure retirement income. Any reasonable projection indicates that social security will provide the bulk of retirement income for most middle-class retirees long into the future. In this context, the idea of cutting back benefits, even for younger workers, seems misguided....MORE

[Demeter]

52. ACLU Asking the Federal Government How It’s Using Drones Inside the U.S.

By Scott Bulua & Stephen Elkind, NYU School of Law ACLU Technology Law & Policy Clinic

http://www.aclu.org/blog/technology-and-liberty/aclu-asking-federal-government-how-its-using-drones-inside-us

It’s a bird! It’s a plane! It’s a drone armed with an arsenal of video surveillance technology!

Today (OCTOBER 23, 2012) the ACLU filed Freedom of Information Act requests seeking records related to the federal government’s domestic use of Unmanned Aerial Systems (UAS) – better known as drones – as well as plans for the future rollout of drones in the United States. Drone technology is largely a product of our war efforts abroad, but the federal government is repurposing these machines for surveillance purposes at home.

We sent the FOIA requests to five federal agencies:

Federal Aviation Administration: Following the FAA Modernization and Reform Act of 2012, the FAA has been tasked with developing a plan for incorporating drones into the national airspace by 2015, and authorizing private and public entities to utilize drones. We’d like to see the FAA’s records on drone flights as well as any policies they’ve been developing.

Department of Justice: DOJ oversees several agencies that we know are using drones in the U.S., including the FBI and DEA. We’d like to know how each agency is using their own drones, drones that they’re borrowing, and drones that they’re lending.

Department of Homeland Security: DHS also oversees several drone-totin’ departments, including U.S. Customs and Border Protection. We’d like to know how DHS is using, and sharing, its drones.

General Services Administration: According to a recent GAO report, “Federal agencies that own or lease UAS report their UAS inventory, cost and utilization data to GSA.” We’ve asked them to share this information.

U.S. Air Force: In a recent document implementing new policy, the Air Force listed several permissible domestic drone uses, including responding to natural disasters, counterintelligence, vulnerability assessments, training, and testing. We’d like to find out how they’ve been using drones for these purposes, or any others.

The ACLU wants to know how the government is using, acquiring, paying for, and sharing drones. We’ve asked the following questions to the government:

How are drones being funded and purchased?

What are the technical capabilities of drones that are being flown in the U.S.?

What type of surveillance data is being captured, and how long is it being stored?

Who can access drones and the data they capture?

What other policies or procedures currently govern the domestic use of drones?

Though the full extent of government ownership of drones remains unclear, one example of government drone use involves U.S. Customs and Border Protection, which is using drones to patrol both our northern and southern borders. The U.S. Border Patrol owns nine drones and is awaiting the delivery of its tenth. Additionally, the Department of Justice is rumored to have four drones of its own that it loans out to police departments.

The ACLU released a report on domestic drones in December 2011, urging that rules be put in place to safeguard Americans’ privacy. The report recommends limits on when drones can be deployed and for what purposes, and calls for restrictions on retention of and access to data collected by drones employed for any purpose. Today’s FOIA requests seek to determine how extensively the government has heeded this advice.

The Electronic Frontier Foundation (EFF) filed a FOIA request in April of 2011 with the FAA to uncover data on the certificates of authorization (COAs) the agency has issued. One year later, after EFF sued the agency, they released a list of all 60 entities that have active, expired, or disapproved COAs. In July 2012, FAA released information for 18 of the 60 entities (who own 125 out of 300 total COAs) that included “extensive details about the specific drone models some entities are flying, where they fly, how frequently they fly, and how long they stay in the air.” Yesterday, EFF reported on their over 200 public records requests to local and federal agencies. With only 19 agencies responding with responsive documents so far, the verdict is still out on how local and federal agencies are utilizing, and plan to utilize, the new technology. Our requests build upon EFF’s by asking the federal government broader questions about its policies and plans for domestic drones.

The government wants drones for surveillance purposes. EFF points out that these drones are “made for watchin’.” Indeed, DARPA has developed a system of surveillance known as ARGUS-IS (Autonomous Real-time Ground Ubiquitous Surveillance-Imaging System). ARGUS-IS produces up to 65 video streams simultaneously, allowing for unprecedented citywide aerial surveillance, even in the dark. This technology is equivalent to utilizing 60 to 100 independent drones and is capable of surveilling tens of square miles simultaneously.

As drone technology becomes less expensive and more ubiquitous, the likelihood of government misuse and abuse of this unprecedented surveillance power increases proportionally. The public should know how the government is using drones in the U.S. and, perhaps more importantly, what it intends to do in the near future.

[Demeter]

58. DHS to start testing drones over US for 'public safety'

https://rt.com/usa/news/dhs-us-public-safety-019/

Don’t be surprised if you catch a federal fleet of sneaky spy drones soaring over your head in the near future, but don’t be too terrified — it’s all in the name of public safety. The US Department of Homeland Security is asking the makers of small unmanned aerial vehicles to submit their crafts for consideration as the agency ramps up the construction of a full-fledged surveillance state across America. The DHS plans to soon conduct drone tests over the Fort Sill, Oklahoma US Army base, and they’re already soliciting spy planes from the private sector so they can select what kind of UAV to use.

According to a request for information published on the Federal Business Opportunities website recently, the DHS is determined to begin drone tests over the military base soon and is seeking submissions from drone makers that don’t mind making a few bucks by having their products put into the US airspace to conduct sweeping surveillance. The Borders and Maritime Security Division of the DHS “will conduct flight testing and evaluation of airborne sensors and small unmanned aerial systems,” the request reads, and now invites vendors to submit drones to be tested “under a wide variety of simulated but realistic and relevant real-world operation scenarios.” The solicitation says that drones will be evaluated to see how well they perform law enforcement operations and conduct search and rescue missions, but once a craft is handed over to the DHS then the details will be put under lock and key. Specifically, the call for work says, "the information within each test report will be classified as For Official Use Only, and will not be shared with the general public."

Given that the department has already addressed the issue of acquiring drones to give the DHS a better eye of domestic doings, though, those law enforcement operations in question could very well transcend away from legitimate uses and quickly cause civil liberty concerns from coast-to-coast. Homeland Security Janet Napolitano told a House Committee panel in July that the DHS was “looking at drones that could be utilized to give us situational awareness in a large public safety [matter] or disaster” and the next piece of the puzzle is already being put into place. With their latest solicitation, the DHS acknowledges that it is specifically testing a “Robotic Aircraft For Public Safety,” but the components necessary to be considered suggest that any drone adopted by the agency will be brought in for sweeping surveillance.

The solicitation request requires that all drones be equipped with Electro-Optical/Infra-Red sensors, as well as the technology to sniff out certain chemicals from thousands of feet from above. The UAV must also have an integrated laser designator, can be hand-launched by a single person and must be able to be remotely managed by a pilot with only one day of training. The Federal Aviation Administration is working towards putting the finishing touches on rules and regulations for widespread domestic drone use, and the agency expects as many as 30,000 UAVs will be in America’s airspace by the decade’s end.

[Demeter]

59. Data Shows Massive Spike In Electronic Surveillance By DOJ

“Pen registers” are devices which detect outgoing information about who telephone or Internet users are contacting and when those communications took place. “Trap and trace” devices capture similar incoming data. So this surveillance would capture the phone numbers that a target is dialing or the email addresses of the people they are in contact with, but it should not capture the actual content of their conversations or emails.

http://thinkprogress.org/justice/2012/10/10/976551/data-shows-massive-spike-in-electronic-surveillance-by-doj/?mobile=nc

[Demeter]

61. Plan for Hunting Terrorists Signals U.S. Intends to Keep Adding names to Kill Lists By Greg Miller

http://www.washingtonpost.com/world/national-security/plan-for-hunting-terrorists-signals-us-intends-to-keep-adding-names-to-kill-lists/2012/10/23/4789b2ae-18b3-11e2-a55c-39408fbe6a4b_story.html

...Among senior Obama administration officials, there is a broad consensus that such operations are likely to be extended at least another decade. Given the way al-Qaeda continues to metastasize, some officials said no clear end is in sight.

“We can’t possibly kill everyone who wants to harm us,” a senior administration official said. “It’s a necessary part of what we do. . . . We’re not going to wind up in 10 years in a world of everybody holding hands and saying, ‘We love America.’ ”

...The number of militants and civilians killed in the drone campaign over the past 10 years will soon exceed 3,000 by certain estimates, surpassing the number of people al-Qaeda killed in the Sept. 11 attacks...

“The problem with the drone is it’s like your lawn mower,” said Bruce Riedel, a former CIA analyst and Obama counterterrorism adviser. “You’ve got to mow the lawn all the time. The minute you stop mowing, the grass is going to grow back.”

HOW SICK IS THAT? NOT TO MENTION, BLIND.

[Demeter]

53. The Top 20 Airports for TSA Theft

http://news.yahoo.com/top-20-airports-tsa-theft-220010013--abc-news-topstories.html

Your suitcase has been tagged and whisked away for a TSA security check before being loaded onto a plane en route to your final destination. How safe are the belongings inside? The TSA has fired nearly 400 employees for allegedly stealing from travelers, and for the first time, the agency is revealing the airports where those fired employees worked.

Newly released figures provided to ABC News by the TSA in response to a Freedom of Information Act request show that, unsurprisingly, many of the country's busiest airports also rank at the top for TSA employees fired for theft.

Sixteen of the top 20 airports for theft firings are also in the top 20 airports in terms of passengers passing through.

At the head of the list is Miami International Airport, which ranks twelfth in passengers but first in TSA theft firings, with 29 employees terminated for theft from 2002 through December 2011. JFK International Airport in New York is second with 27 firings, and Los Angeles International Airport is third with 24 firings. JFK ranks sixth in passenger traffic, while LAX is third. Chicago, while second in traffic, ranked 20th in theft firings.

The four airports listed in the TSA's top 20 list of employee firings for theft that aren't also among the FAA's top 20 for passenger activity are Salt Lake City International, Washington Dulles, Louis Armstrong New Orleans International, and San Diego International.

The top airports across the U.S. for TSA employees fired for theft are:

1. Miami International Airport (29)

2. JFK International Airport (27)

3. Los Angeles International Airport (24)

4. Hartsfield-Jackson Atlanta International Airport (17)

5. Las Vegas-McCarren International Airport (15)

6. Dallas/Fort Worth International Airport and New York-Laguardia Airport (14 each)

8. Newark Liberty, Philadelphia International, and Seattle-Tacoma International airports (12 each)

11. Orlando International Airport (11)

12. Houston-George Bush Intercontinental Airport and Salt Lake City International Airport (10 each)

14. Washington Dulles International Airport (9)

15. Detroit Metro Airport and Louis Armstrong New Orleans International Airport (7)

17. Boston-Logan International, Denver International and San Diego International airports (6)

20. Chicago O'Hare International Airport (5)

During a recent ABC News investigation, an iPad left behind at a security checkpoint at the Orlando airport was tracked as it moved 30 miles away to the home of the TSA officer last seen handling it....

[Demeter]

54. Thank You, Dear Anonymous, for the Star

It is very kind of you.

[Demeter]

55. Democrats stiffen spine against trimming benefits

AHA! THE GAME IS AFOOT! NOW, SHALL THE PEOPLE BE PREDATOR FOR ONCE, OR PREY, AS USUAL?

http://news.yahoo.com/democrats-stiffen-spine-against-trimming-benefits-135744343--finance.html

President Barack Obama's re-election has stiffened Democrats' spine against cutting popular benefit programs such as Medicare and Social Security. Their new resolve could become as big a hurdle to a deal that would skirt crippling tax increases and spending cuts in January as Republicans' resistance to raising tax rates on the wealthy.

Just last year, Obama and top Democrats were willing during budget negotiations with Republicans to take politically risky steps such as reducing the annual inflation adjustment to Social Security and raising the eligibility age for Medicare. Now, with new leverage from Obama's big election victory and a playing field for negotiations that is more favorable in other ways, too, Senate Majority Leader Harry Reid and other Democrats are taking a harder line.

"I've made it very clear. I've told anyone that will listen, including everyone in the White House, including the president, that I am not going to be part of having Social Security as part of these talks relating to this deficit," Reid, D-Nev., told reporters.

Reid's edict would appear to take a key proposal off the table as an ingredient for a deal on avoiding the "fiscal cliff," the year-end combination of expiring President George W. Bush-era tax cuts and harsh across-the-board spending cuts. AND WE ALL KNOW HOW STUBBORN HARRY CAN BE--IF HE DOESN'T GET A PAYOFF, THAT IS...

At issue is the inflation adjustment used by the government to calculate cost-of-living adjustments for Social Security and other federal programs. A less generous inflation measure that takes into account consumers finding alternatives when prices go up could reduce deficits by more than $200 billion over the next decade. It's a no-brainer for many budget wonks because it means gradual, less noticeable curbs to the growth of benefits. It also means about $70 billion more tax revenues over 10 years because automatic rises in tax brackets to account for inflation would be smaller. That new inflation index, known as chained Consumer Price Index, is a magic elixir for budget writers. But it's anathema to many liberals, who say that moving to the new cost-of-living measure could cut average retiree benefits by about $600 a year a decade after taking effect and mean a cut of about $1,000 a year after 20 years.

"Think about it this way. You're standing on the deck of a boat and you're in very deep water and they want you to swim, but they're going to put a log chain around your ankle," Sen. Tom Harkin, D-Iowa, told a group of liberal activists assembled for a rally Thursday in a Senate hearing room. "That's chained CPI."

Sixteen months ago, Obama's White House took a different view during talks with House Speaker John Boehner, R-Ohio, on a possible budget deal. A White House draft offer by top Obama aide Rob Nabors, made public by Washington Post author Bob Woodward, proposed several controversial changes to benefit programs, including the lower inflation adjustment, raising the eligibility age for Medicare and higher Medicare premiums. Those negotiations, however, were conducted on a playing field that favored Republicans. It was less than a year after Obama's self-described "shellacking" in the 2010 elections and the president was desperate to win an increase in the government's borrowing cap and avoid a government default on its debt that should shatter financial markets. Also, Obama still faced re-election in 2012.

Now conditions favor Obama.

He decisively won re-election and Republicans seem fearful of being tagged with the blame if an impasse results in the government going over the fiscal cliff. Obama and Democrats already are portraying Republicans as hostage-takers willing let tax rates rise on everyone if the lower Bush-era tax rates are not also extended for the top 2 percent to 3 percent of earners — those with incomes above $200,000 for individuals and $250,000 for joint filers. The new balance of power means that Democrats who once would have acquiesced reluctantly to GOP demands for stiff benefit cuts are now balking at ideas such as chained CPI or an increase in the Medicare retirement age, as well as demanding GOP concessions to higher taxes.

"The price for that kind of thing has gone up," said a senior House Democrat who required anonymity to speak frankly on party strategy. "Negotiations depend on the situation. No one should expect to get the same kind of deal."

Republicans have gotten the message, but insist that higher tax revenues be paired with cuts to rapidly growing programs such as Medicare and the Medicaid health care program for the poor and disabled... No way, say many liberals.

"We're going to send a loud message to the leadership in the House, in the Senate, and President Obama: 'Do not cut Social Security, do not cut Medicare, do not cut Medicaid,'" said Vermont Sen. Bernie Sanders, a self-declared socialist who aligns with Democrats. "Every now and then elections have consequences. We won."

Republicans and even some Obama allies worry that liberal demands will make it harder for the president to seal a bargain with the GOP.

Rep. Mike Quigley, D-Ill., said Obama has the same problem with his party's liberal base that Boehner has with some conservative Republicans. "Boehner has a disproportionate group of his folks skewing things too far out and the president has equally the same sort of problems with people who are horribly unreasonable," Quigley said.

SOMEBODY PRIMARY THAT QUISLING QUIGLEY OUT, SHOW HIM HOW UNREASONABLE WE CAN BE.

[Demeter]

56. Blue Dogs Are Dwindling By Molly Ball, The Atlantic

http://news.yahoo.com/blue-dogs-dwindling-125014813--politics.html;_ylt=Anxyhdwa_Sk1odTJuHGTRq.ECu9_;_ylu=X3oDMTVxaGtodXUxBGNjb2RlA2dtcHRvcDEwMDBwb29sd2lraXVwcmVzdARtaXQDQXJ0aWNsZSBNaXhlZCBMaXN0IE5ld3MgZm9yIFlvdSB3aXRoIE1vcmUgTGluawRwa2cDOTJiZGZlNGQtZjU5Zi0zZWRmLWIwNmUtZDA4MTkxMjU3ZjY3BHBvcwMxBHNlYwNuZXdzX2Zvcl95b3UEdmVyA2YwZDZlM2UxLTMwY2QtMTFlMi1iZmY1LTU5NzQ2YzU2YmU5Zg--;_ylg=X3oDMTM0ZG40b2tuBGludGwDdXMEbGFuZwNlbi11cwRwc3RhaWQDYTI3YmE0NzYtZjA2Zi0zOTAxLWEzNDAtMjk5NDViYzE5ZjgwBHBzdGNhdANwb2xpdGljc3xjb25ncmVzcwRwdANzdG9yeXBhZ2U-;_ylv=3

The Democrats' gains in the House and Senate in last week's election were modest: just five seats in the former and two in the latter, at last count. (Several House races remain too close to call). And yet the Left is jubilant. Why? Because they see a changed Congress in terms of quality, not quantity.

Nov. 6 was "probably one of the best election nights progressives will ever have," says Adam Green, cofounder of the Progressive Change Campaign Committee. "Underlying the fact that Democrats picked up a few seats is that the progressive ranks are growing while the Blue Dogs are dwindling."

The Blue Dogs, the caucus of self-styled moderate House Democrats, had 54 members two years ago. When the new Congress convenes in January, there will be 14 of them. "We replaced Joe Lieberman with a real progressive," Green says, referring to Connecticut Democrat Chris Murphy. Nebraska Senator Ben Nelson is out; Elizabeth Warren, of Massachusetts, is in. North Dakota's old Democratic senator was the moderate Kent Conrad; its new Democratic senator, Heidi Heitkamp, campaigned on a platform of ending tax cuts for millionaires and protecting Social Security from cuts. Green expects the Congressional Progressive Caucus to have between 90 and 100 members when it reconvenes. Progressive advocates believe these new faces will lead to more favorable policies out of Congress. No longer will they have to deal with the likes of Rep. Jason Altmire, who voted against Obamacare and lost in this year's primary, or the rest of the Blue Dogs whose opposition kept the public option out of the party-line health care bill.

But the progressives also make a political argument. For years, they've claimed that Democrats need to be more progressive, not less, if they want to win elections. The idea that tacking to the middle and embracing center-right positions is what wins, they say, is a canard. Now, they point to the 2012 results as proof. In the red states of North Dakota and Montana, where Sen. Jon Tester won reelection, Democratic candidates succeeded with "prairie populism" — defiantly embracing taxing the rich and protecting entitlements. Right-wing interest groups spent millions calling them tax-hikers, but they didn't back down, and they won anyway. Progressive stalwart Sherrod Brown was reelected to the Senate in Ohio; Rep. Tammy Baldwin, a member of the Progressive Caucus, was elected to the Senate from Wisconsin. Meanwhile, in Nebraska, Bob Kerrey, who embraced entitlement cuts, lost his Senate bid. "When Democrats stand up boldly on economic issues, even conservative voters will vote for them," Green says. This is not an uncontested theory of the 2012 elections, of course. Kerrey, for example, probably was hurt more by his years living in New York than his economic platform, according to observers, and he faced an appealing Republican opponent in soon-to-be-senator Deb Fischer. Meanwhile, for every leftist partisan who celebrates the more liberal composition of the Democratic caucus, there's a centrist who worries that Congress's increasing polarization — Democrats on the far left, Republicans on the far right — makes it harder to reach consensus and get things done. But Green still cherishes the lessons of his formative political jobs in South Dakota, where he worked as the press secretary for Sen. Tim Johnson's reelection campaign in 2002. "I ended up being the campaign's liaison to the farmer and rancher community — culturally conservative, pro-gun rural voters," Green recalled. "Johnson fought back against big agribusiness, and these Republicans were willing to vote for a Democratic politician who stood up for their families." Johnson won that race over then-Rep. John Thune by 524 votes. Two years later, Thune ran for Senate again, this time against then-Majority Leader Tom Daschle. "Daschle was different," Green said. "He was in favor of free-trade agreements. He voted with big corporations and Wall Street." Thune defeated Daschle by 4,508 votes, the first toppling of a Senate party leader since 1952.

Now, progressives' hopes rest on this new crop of liberal representatives — particularly Warren, whose election was boosted by donations and groundwork from Green's group, and who sent its members a thank-you note after Election Day. Postelection, progressive groups and labor unions have mounted an aggressive campaign to keep the pressure on Obama and Democrats to hike taxes on the wealthy, and they're counting on Warren and her ilk to back them up.

"Elizabeth Warren is the capstone. She's a game changer," Green said. "She will not be a typical freshman. With her track record and her megaphone, we predict a major Elizabeth Warren bandwagon effect."

[Demeter]

57. Now Ireland is Nationalizing the Banks

AND ABOUT TIME, TOO

[Demeter]

60. The following are 28 good questions that the mainstream media should be asking....

http://theeconomiccollapseblog.com/archives/28-good-questions-that-the-mainstream-media-should-be-asking

1. Why is the IMF warning that there is an "alarmingly high" risk of a deeper global economic slowdown?

2. Why is Switzerland preparing for "major civil unrest" throughout Europe?

3. If the Spanish financial system completely collapses, what is that going to mean for the rest of Europe and the rest of the globe?

4. Is Turkey about to drag the rest of NATO (including the United States) into a war with Syria?

5. Why aren't people screaming in outrage about the fact that the U.S. national debt increased by more than a trillion dollars for the fourth straight year in 2012?

6. Should we be concerned that the U.S. government added more to the U.S. national debt on the first day of fiscal year 2013 than it did from 1776 to 1941 combined?

7. If temporary refinery problems can cause some gas stations to shut down and cause gas prices in California to skyrocket to all-time highs, what would a real crisis do?

8. Why are some analysts predicting that a "rapid collapse" is coming for the U.S. dollar?

9. Will the U.S. dollar soon lose its status as the primary reserve currency of the world?

10. Why is Marc Faber warning that the wealthy "may lose up to 50 percent of their total wealth"?

11. By keeping interest rates near zero, is the Federal Reserve crushing the retirement dreams of millions of elderly Americans?

12. Why do Barack Obama, Mitt Romney and most members of Congress continue to stand behind the TSA when nearly 400 TSA employees have been fired for stealing from travelers since 2003?

13. Why are nearly half a million employees of the federal government making over $100,000 a year?

14. How in the world can you have a debate about the economy that lasts for an hour and a half and never even mention Ben Bernanke, the Federal Reserve or quantitative easing?

15. Why are Romney campaign signs being smeared with excrement?

16. British taxpayers spent 57.8 million dollars on the royal family in 2011. U.S. taxpayers spent 1.4 billion dollars on the Obamas that same year. How in the world can this be justified?

17. Why does the U.S. government treat our military veterans like garbage? Many of them have given everything for their country. Shouldn't we treat them with more respect?

18. Why is the mainstream media ignoring a warning that an international gang of cybercriminals plans "to steal money from the online accounts of thousands of consumers at 30 or more major U.S. banks"?

19. The New England Complex Systems Institute in Cambridge, Massachusetts is warning that rapidly rising global food prices could soon lead to massive food riots all over the planet. Is this something that we should be concerned about?

20. Why is the United Nations pushing to have the authority to impose "global taxes" on all of us?

21. How did we get to the point where sex trafficking is now at epidemic levels all over the United States?

22. Why are so many young people being arrested? Should we be concerned that 41 percent of all Americans have been arrested by the time they reach the age of 23?

23. Why are most Americans either overweight or obese or severely obese?

24. How was one Baltimore woman able to accumulate 30 free cell phones all paid for by the federal government?

25. Why are nearly 30 percent of all young adults in the 25 to 34 year old age bracket living at home with their parents?

26. Why has the birth rate in the United States fallen to an all-time low?

27. With the race for president incredibly tight right now, will the side that loses end up accusing the other side of using voter fraud to steal the election?

28. Is the U.S. Supreme Court about to make it illegal to resell our own stuff at yard sales, in thrift stores and on eBay?

Do you have any questions to add to this list?

[Demeter]

62. Gonna Quit While I'm Ahead Here

It's been nice just posting along, seeing the inbox drop to bearable levels, and finding so much relatively good news that doesn't seem to be mere election hyperbole and snake oil.

I don't know if I'll continue posting on Sunday...this thread is full enough if I don't.

You are, of course, welcome to add to it! Many hands give us a clearer picture.

We're going into Turkey Week, and by popular request (AnneD is popular, isn't she?) next weekend's thread will feature:

"Turkeys I Have Known"

Be prepared to baste, bake, deep-fry, broil and incinerate your pet peeves on WEE!

[AnneD]

77. It isn't a case of popularity...

It is just that I know a turkey when I see it, literal or metaphorical.

[Demeter]

63. PRE-ELECTION: Obama Campaign Struggles to Find Voters Hit by Foreclosures

http://news.firedoglake.com/2012/07/18/obama-campaign-struggles-to-find-voters-hit-by-foreclosures/


I remember talking with candidates in hard-hit foreclosure areas in 2010 about the impact of that on their campaign strategies. Simply put, many of the traditional Democratic voters in those areas, who came out in large numbers in 2008, had scattered, victims of the foreclosure crisis. Even if they could be found, they may no longer be in the district, and they certainly aren’t focused on politics so much as survival. The other problem is that it’s hard to schedule an effective precinct walk when you go to a neighborhood and half of the homes are vacant.

The Obama campaign, after four years of ineffective programs to deal with the foreclosure crisis, now has to deal with these problems first-hand.

By day, Lynnette Acosta, a 34-year- old mother of two, is an information-technology manager in Orlando, Florida. By night, she’s a sleuth for President Barack Obama’s re-election campaign, scouring for potential voters.

In central Florida, that means knocking on doors in Hispanic neighborhoods with foreclosure rates as high as 30 percent, where once-registered Democrats have been evicted, their homes now owned by the bank. Volunteers walk house-to- house to determine the number of empty homes per precinct, then look for contact information for voters who once lived in them [...]

As Obama confronts a housing crisis that he’s acknowledged underestimating, his campaign is facing a different kind of foreclosure problem on the streets of Florida and other battleground states, where evictions have left holes in its voter lists. Volunteers like Acosta are central to the campaign’s effort to populate its databases with current addresses and working phone numbers to get out the vote.

It will take a massive use of resources to map out entire neighborhoods and entire swing states, particularly ones in high-foreclosure areas like Florida and Nevada and Ohio, to determine who lives in the homes and who doesn’t. And it’s not only about finding those voters, it’s about convincing them of the worthiness of the Administration that allowed massive continued abuse in the mortgage market and did little to help them keep their homes. And the communities most ravaged by the crisis line up demographically with the communities that most supported Obama – African-Americans and Hispanics, primarily.

This is a less relevant side effect to the destruction of communities in the foreclosure crisis than, say, the actual destruction. But for the Obama campaign, it represents chickens coming home to roost, to paraphrase Rev. Jeremiah Wright. Maybe they should have thought about keeping their promises and helping people stave off illegal foreclosures, with the recognition that they’d have to go back and locate the same people four years later.

PROVING IT WAS THE LESSER OF TWO EVILS...NOT GOOD

[xchrom]

64. ...

[xchrom]

65. Economic Data Confirms Hurricane Sandy Was Worse Than We Thought

http://www.businessinsider.com/hurricane-sandy-worse-than-we-thought-2012-11

***SNIP

The data was so bad that Morgan Stanley's Vincent Reinhart was forced to reduced the firm's Q4 GDP tracking estimate to +0.6% from +0.8%.

From Morgan Stanley's Macro Dashboard:

Economic data released the past week pointed to a larger hit to the economy from Hurricane Sandy than initially expected. Katrina was generally estimated to have cut GDP growth in the last third of 2005 by about 0.5 to 1.0 percentage points, with a corresponding boost to activity in 2006. Rebuilding after Sandy will likewise probably provide a boost to growth over the course of 2013, but early data suggest the initial hit to the economy might be comparable to Katrina. Significantly worse than expected retail sales and industrial production results in October, on what appeared to be sizable negative impacts from Sandy, and jobless claims and regional manufacturing surveys point to further drag in November.

Overall retail sales fell 0.3% in October and the key retail control category fell 0.1%, as disruptions to auto and mall sales in the last weekend of the month on the East Coast were only partly offset by pre-hurricane stockpiling at grocery and drug stores. Incorporating this worse than expected result, we see Q4 GDP tracking at +0.6%, down from our +0.8% estimate coming into the week. Manufacturing output plunged 0.9% in October, with the Fed estimating that the hurricane knocked a point from growth to exacerbate a deteriorating trend in factory output since early in the year. Jobless claims in the week before the survey period for the November employment report surged 78,000 to 439,000, pointing to significant job losses in the aftermath of the hurricane, and the Empire State and Philly Fed manufacturing surveys remained weak, with the two averaging 47.3 on an ISM-comparable weighted average basis.


Read more: http://www.businessinsider.com/hurricane-sandy-worse-than-we-thought-2012-11#ixzz2Ca6t5p9T

[xchrom]

66. OPTIMISM: What Keeps Us Alive Today Will Kill Us Tomorrow

http://www.businessinsider.com/optimism-bias-2012-11

***SNIP

I've said it many times before: we are the most tragic species. We not only destroy all of the world around us, we are aware of doing it but unable to stop ourselves. We have faith and hope that things will get better, that we can turn around at the last second what we've screwed up over years and decades. Which of course is nothing but an excuse to keep on screwing up. All courtesy of our optimism bias.
Here's the graph:



The thing about this graph and its consequences is that the policies for what happens at the final stages shown in the graph are defined by the predictions at the early stages. Once reality sinks in, it's too late, the damage has been done. The difference is then made up for by firing an additional million people here and there, cut pensions and benefits for a few million more, and keep talking about a recovery just around the corner. Beyond the horizon, more like it.

This is how all those who have a public voice you care to listen to treat their audiences. Because they are well aware that if they spread a message that fits in with the prevalent optimism bias, they will be more popular, sell better, get more votes, get elected into office. When Jack Nicholson said you don't want the truth because you can't handle the truth, he was talking to a much wider audience than we would like to acknowledge.

And so we get what we get. Still, you can't always get what you want. In the end, all that's left is what you need. And we know that, unconsciously. It's just that in the meantime we like to be sitting pretty. And not think about the fact that this very attitude of ours will hasten and worsen the end. We're creatures bent on instant gratification. Which is, come to think of it, precisely why we have our optimism bias in the first place.


Read more: http://www.businessinsider.com/optimism-bias-2012-11#ixzz2Ca9o0Vjv

[xchrom]

67. Here's What The "Fiscal Cliff" Tax Deal Is Starting To Look Like...

http://www.businessinsider.com/fiscal-cliff-taxes-2012-11



THE election dust had barely settled when Barack Obama and his Republican adversaries returned to their traditional rhetoric over taxes. "Raising tax rates is unacceptable," John Boehner, the Speaker of the House of Representatives, declared on November 8th. The next day Mr Obama said "I am not going to ask students and seniors and middle-class families to pay down the entire deficit while people like me, making over $250,000, aren’t asked to pay a dime more in taxes."

Optimists, however, took note of what the men did not say: Mr Boehner did not rule out raising tax revenues. Mr Obama did not explicitly insist that the two top income tax rates, now 33% and 35%, return to 35% and 39.6%, as they are scheduled to do when George W. Bush’s tax cuts expire at the end of this year.

This has aroused hopes that the two men can find common ground on tax reform that leaves marginal tax rates where they are while raising new revenue by curbing credits, deductions and exemptions (collectively called tax expenditures), which distort economic activity. Numerous such proposals have been aired in recent years, some of which Republicans hated because they raised new revenue; others Democrats rejected because they gave a windfall to the wealthy.

One way this could be done is to target deductions that primarily benefit the rich. During the election campaign, Mitt Romney proposed paying for big marginal rate cuts by setting a cap on total deductions. The Tax Policy Centre, a think-tank, reckons a cap of $50,000 would raise $749 billion over ten years, comparable to the $800 billion that Mr Boehner entertained during failed negotiations with Mr Obama in 2011. Importantly, this fix would make the tax system much more progressive: 80% of the additional money would come from the top 1% of earners. This has helped draw interest from some Democrats.


Read more: http://www.businessinsider.com/fiscal-cliff-taxes-2012-11#ixzz2CaCM1mCB

[xchrom]

68. Spain Deepens EU Budget Deadlock as Rajoy Spars With Van Rompuy

http://www.bloomberg.com/news/2012-11-17/spain-deepens-eu-budget-deadlock-as-rajoy-spars-with-van-rompuy.html

Spanish Prime Minister Mariano Rajoy rejected a proposal for the European Union budget made by its president Herman Van Rompuy, while European Commission President Jose Manuel Barroso requested “solidarity” from members.

“The EU president’s current proposal is not acceptable for Spain,” Rajoy told reporters today following a two-day summit of Ibero-American leaders in Cadiz, southern Spain.

While the European Commission’s initial proposal was “a good starting point”, Spain rejects a second proposal made by Van Rompuy due to plans for cohesion funds and a “radical” reduction in the budget for the common agricultural policy, Rajoy said.

Spanish opposition deepens a deadlock between European governments over the bloc’s budget for 2014 to 2020 before a Nov. 22-23 summit of EU leaders. With unemployment at 26 percent after a five-year economic slump, Spain’s struggle to restore growth is at the heart of a debate about how to balance reordering public finances and stimulating growth.

[xchrom]

69. World’s Wealthiest Lose $26 Billion as Fiscal Cliff Nears

http://www.bloomberg.com/news/2012-11-16/world-s-wealthiest-lose-26-billion-as-fiscal-cliff-nears.html

The 100 wealthiest people on the planet lost $26.1 billion from their collective net worth this week as global markets fell amid concern about the U.S.’s so- called fiscal cliff and Europe’s debt crisis.

Microsoft Corp. (MSFT) co-founder Bill Gates, 57, lost $1.8 billion as shares of the world’s largest software maker retreated 8 percent during the week. The Redmond, Washington- based company replaced its Windows division chief Steven Sinofsky on Wednesday, less than a month after the release of Windows 8. Gates, the world’s second-richest man, is worth $60.4 billion, according to the Bloomberg Billionaires Index.

“Investors got buried under global headlines,” Jack Ablin, chief investment officer at BMO Harris Private Bank in Chicago, which oversees about $60 billion of assets, said in a phone interview. “Anything with an international growth bias got hammered.”

The Standard & Poor’s 500 Index (SPY) has dropped 4.8 percent since U.S. President Barack Obama was re-elected on Nov. 6th. He met with congressional leaders Friday to discuss the fiscal cliff, a collection of $607 billion in tax increases and spending cuts scheduled to take effect next year. House Speaker John Boehner said the budget talks were constructive and he would accept an increase in government revenue if coupled with spending cuts.

[bread_and_roses]

70. "5 Ways Most Americans Are Blind to How Their Country Is Stacked for the Wealthy"

http://www.alternet.org/economy/5-ways-most-americans-are-blind-how-their-country-stacked-wealthy?paging=off

How many people know that out of 150 countries, we have the fourth-highest wealth disparity? Only Zimbabwe, Namibia and Switzerland are worse.

... Here are some of the common misconceptions.

1. Americans believe that the poorest 40 percent own about 10% of the wealth... in reality they own much less than 1% of the wealth. Out of every dollar, they own a third of a penny...or every dollar of non-home wealth owned by white families, people of color have only 1 cent...

2. Entitlements are the problem...

3. Welfare benefits are a drag on the economy...

4. The American Dream is still alive, if you just work hard enough...

5. Prison puts away the bad guys.

And why do people believe these things? One reason is that our pusillanimous Dems repeat them in accordance with the wishes of their Corporate Paymasters so that the pusillanimous echo-chamber MSM has the excuse of parroting them as well as the rabid Right-wingers constant drumbeat.

A pox on both their Houses.

[bread_and_roses]

71. "Why Even President Obama Won't Champion Social Security"

https://www.commondreams.org/view/2012/10/24-9

Published on Wednesday, October 24, 2012 by The Guardian
Why Even President Obama Won't Champion Social Security
Although millions of middle-class Americans strongly support social security, big bucks campaign donors hate it. That's why
by Dean Baker

It is remarkable that social security hasn't been a more prominent issue in the presidential race. After all, Governor Romney has proposed a plan that would imply cuts of more than 40% for middle-class workers just entering the labor force. Since social security is hugely popular across the political spectrum, it would seem that President Obama could gain an enormous advantage by clearly proclaiming his support for the program.

But President Obama has consistently refused to rise to the defense of social security. In fact, in the first debate, he explicitly took the issue off the table, telling the American people that there is not much difference between his position on social security and Romney's.

On its face, this is difficult to understand. In addition to being good politics, there are also solid policy grounds for defending social security. The social security system is perhaps the greatest success story of any program in US history. By providing a core retirement income, it has lifted tens of millions of retirees and their families out of poverty. It also provides disability insurance to almost the entire workforce. The amount of fraud in the system is minimal, and the administrative costs are less than one 20th as large as the costs of private-sector insurers.

... But there is another set of economic considerations affecting the politics of social security. These considerations involve the economics of the political campaigns and the candidates running for office. The story here is a simple one: while social security may enjoy overwhelming support across the political spectrum, it does not poll nearly as well among the wealthy people – who finance political campaigns and own major news outlets. The predominant philosophy among this group is that a dollar in a workers' pocket is a dollar that could be in a rich person's pocket – and these people see social security putting lots of dollars in the pockets of people who are not rich.

... For this reason, a candidate who comes out for protecting social security can expect to see a hit to their campaign contributions.

[Demeter]

72. 538 members of Congress will have to get off their asses then

and do the work they are paid for. By the People.

[bread_and_roses]

73. Nate Silver: "looking for the next low-hanging fruit...Economic news, he thinks"

LOL. Article on Nate Silver - I love the line emphasized below (emphasis mine).

http://www.guardian.co.uk/world/2012/nov/17/nate-silver-interview-election-data-statistics

Nate Silver: it's the numbers, stupid

... "I was looking for something like baseball, where there's a lot of data and the competition was pretty low. That's when I discovered politics."

Silver thought that by taking the available data and applying Bayesian theory to it, he might have "some small edge". There is a lot of data in American politics and Bayesian theory, a way of calculating conditional probabilities, has been around since an English clergyman, Thomas Bayes, first formulated it sometime at the start of the 18th century. It was not, as his critics have been quick to point out, exactly rocket science.

... "Numbers aren't perfect, but for me, it's numbers with all their imperfections versus bullshit. You had people saying, 'You can't quantify people's feelings through numbers!' But what's the alternative?

...He's looking for the next low-hanging fruit, an area with lots of data and "not much competition". Economic news, he thinks, is ripe for the approach.

I agree, Nate.

[Demeter]

74. Hostess Blames Union for Bankruptcy after Tripling CEO’s Pay By Annie-Rose Strasser

NOT TO MENTION MORE THAN DOUBLING THE DEBT IN 8 YEARS...

http://www.nationofchange.org/hostess-blames-union-bankruptcy-after-tripling-ceo-s-pay-1353255416

Today, Hostess Brands inc. — the company famed for its sickly sweet desert snacks like Twinkies and Sno Balls — announced they’d be shuttering after more than eighty years of production.

But while headlines have been quick to blame unions for the downfall of the company there’s actually more to the story: While the company was filing for bankruptcy, for the second time, earlier this year, it actually tripled its CEO’s pay, and increased other executives’ compensation by as much as 80 percent. At the time, creditors warned that the decision signaled an attempt to “sidestep” bankruptcy rules, potentially as a means for trying to keep the executive at a failing company. The Confectionery, Tobacco Workers & Grain Millers International Union pointed this out in their written reaction to the news that the business is closing:

BCTGM members are well aware that as the company was preparing to file for bankruptcy earlier this year, the then CEO of Hostess was awarded a 300 percent raise (from approximately $750,000 to $2,550,000) and at least nine other top executives of the company received massive pay raises. One such executive received a pay increase from $500,000 to $900,000 and another received one taking his salary from $375,000 to $656,256.

Certainly, the company agreed to an out-sized pension debt, but the decision to pay executives more while scorning employee contracts during a bankruptcy reflects a lack of good managerial judgement.

It also follows a trend of rising CEO pay in times of economic difficulty. At the manufacturing company Caterpillar, for example, they froze workers’ pay while boosting their CEO’s pay to $17 million. And at Citigroup, CEO Vikram Pandit received $6.7 million for crashing his company, walking off with $260 million after the business lost 88 percent of its value.

[Demeter]

75. They Led Us to the Cliff but Can’t Make Us Jump By Froma Harrop

http://www.nationofchange.org/they-led-us-cliff-can-t-make-us-jump-1353250762

...The tea party is one reason we're at the fiscal cliff — a kind of witching hour on Jan. 1. It is when the Bush tax cuts are scheduled to expire, along with a payroll tax cut included in the 2009 stimulus bill. It is kick-off time for $1.2 trillion in automatic spending cuts over 10 years. Taking that much money out of the economy so quickly could send America back into recession. The spending cuts are a hangover from the debt-ceiling fiasco of a year ago. Recall from that time of national insanity the patriots threatening to send the United States into default on its debt. Recall their stopping so-called Republican leaders from making a deal that included any new tax revenues. Recall grownups from both parties — terrified of economic disaster in the event of a default — agreeing on the above radical spending cuts should a better plan not arrive in time.

The Republican Party

A new Washington Post-Pew Research poll has 53 percent of Americans ready to blame Republicans if America actually goes over the edge and only 29 percent planning to point fingers at President Obama. Understanding this, thoughtful Republicans are feeling freer to risk the tea partiers' wrath and cooperate with Democrats. The teams may disagree on much, but at least they're now playing in the same ballpark. Obama wants the Bush cuts to expire only for the wealthy. Republicans want to extend them for everyone but eliminate some deductions and close a bunch of loopholes. They also talk of limiting the amount of deductions the rich can take. All solid ideas, though it appears that ending tax breaks alone will not raise enough revenues. Put another way, the middle class would have to pay more in taxes to make the numbers work. Americans in the comfortable middle may eventually have to pitch in, but since the richest Americans benefited most mightily from the Bush tax cuts, they should go first.

On spending, Republicans are agonizing over the automatic $600 billion cut in military spending. During the campaign, they wanted additional defense spending. Now they should settle for less. More Americans are asking why they spend as much on defense as the next 10 countries put together.

Deficit hawks must also look at entitlements. (The exception would be Social Security, an earned benefit.) The Affordable Care Act makes a start on slowing the rising costs of Medicare, and the Obama administration has long indicated a willingness to go further...

[Demeter]

76. The Trojan Horse in the Debt Debate By Sarah Anderson

http://www.nationofchange.org/trojan-horse-debt-debate-1353254600


...A major player in this hot debate is a new corporate coalition called "Fix the Debt." They've recruited more than 80 CEOs of America's most powerful corporations and raised $60 million for a big media and lobbying blitz. Their ads call for what appears to be a moderate agenda of balancing spending cuts with some tax increases in order to bring down the deficit and ensure a bright future for the United States. But a closer look suggests the Fix the Debt campaign is a Trojan Horse. Behind their moderate slogans is an extreme agenda focused on further reducing corporate taxes and shifting the burden onto the poor and elderly.

Take a look, for example, at a slideshow presentation the campaign has prepared as a "CEO tool" for wooing supporters. You can check it out right on their web site. It says flat out that the so-called "fiscal cliff" is an opportunity to push for "considerably less" spending on Medicare and Medicaid. It also calls for a shift to a "territorial tax system," which would permanently exempt U.S. corporations' foreign income from U.S. taxes. At the Institute for Policy Studies, we analyzed how much the Fix the Debt member corporations would have to gain from this particular corporate tax break. The results are staggering.

We focused on the 63 Fix the Debt member companies that are publicly held and therefore must report how much they've amassed in overseas profits. Combined, these firms stand to gain as much as $134 billion in tax windfalls if the territorial system is adopted. That's $134 billion that won't go towards fixing the debt. To put that figure in perspective, it would be enough to cover the salaries of two million elementary school teachers for a year. One of the biggest potential winners from a territorial tax system is Microsoft, which could reap a savings of $19.4 billion on its $60.8 billion in accumulated foreign earnings. Why does Microsoft have so much dough stashed overseas? A Senate investigation this year shed light on this question. They found that Microsoft takes the patents for software developed at its U.S. research facilities and registers them in tax haven countries. That way, when a U.S. customer buys a copy of Microsoft Office, a hefty chunk of the profits is recorded in no-tax zones. Under current rules, Microsoft would have to pay U.S. taxes on such foreign earnings if they bring them back to the United States to invest or pay shareholder dividends. But under Fix the Debt's favored territorial system, they would be permanently exempted.

The Fix the Debt campaign's CEOs are attempting to portray themselves as the reasonable compromisers. Some of them have even offered to give up the Bush-era tax cuts for the rich in exchange for other parts of their agenda. But given the massive windfalls they could get from a shift to a territorial tax system and other corporate tax breaks, this is hardly surprising. If their companies save billions in tax dollars, corporate profits will soar — and their CEO pay will skyrocket too. Beware of this Trojan horse. These CEOs may try to conceal their tired old agenda of more corporate tax breaks in a patriotic package. But if they're serious about helping America, they wouldn't be trying to balance the budget on the backs of the most vulnerable.