January 2012

When Government Spending Gets Really Obscene

by Richard Morrison on April 23, 2009

in Culture, Regulation, Tech & Telecom, Zeitgeist

My good friend and Bureaucrash ally Xaq Fixx recently altered me to an interesting story on the intersection of politics, technology and free speech. It seems that the state government of California, through the California Employment Training Panel, is paying contractors who train in-state workers in new skills – an effort to boost the Golden State’s notoriously sagging economy. Nothing too unusual there.

Enter SF Weekly’s Matt Smith, who noticed that the list of recipients of this state-subsidized training were employees of Cybernet Entertainment LLC. Cybernet in turn is the proprietor of a number of websites which feature videos catering to adult and, ah, highly specialized interests. Kinky but legal, in other words. Smith submitted a public records request regarding the company’s participation to the state, and received a reply to the effect that “the government had been unaware that Cybernet was in the business of narrowcasting videos depicting sexualized torture.”

Thus informed, however, officials at the Employment Training Panel promptly canceled Cybernet’s participation in the program, citing a policy of not working with the adult entertainment industry. The company’s COO Daniel Riedel, has vowed to fight the state to keep the subsidy. Interestingly, scribe Smith goes on to cite the possibility that denying participation in the program based on the content produced by Cybernet may violate the First Amendment:

Does the state’s refusal to train porn-makers violate constitutional free-speech guarantees? I’m not joking. Some serious and credible people says it’s worth considering whether it’s legal to deny training to porn workers merely because they film naked, shackled women with live electrodes clipped to their genitals.

Smith then goes on to cite experts from the California First Amendment Coalition and the UC Hastings College of the Law to the effect that there might, in fact, be a case here for Cybernet. And, of course, they have their natural allies within their own industry – porn titan Vivid Entertainment Group is also opposed to the decision.

So what do we think, OpenMarket readers? Assuming that there’s going to be an employment training subsidy program in place at all, should the people running it have discretion to deny participation to legal businesses because they don’t like the product being pedaled? Should vegan grant administrators, for example, be able to veto applications from meat processing plants, or Catholic administrators applications from health clinics that provide abortions? Tell us what you think in the comments section.

Celebrating the Bard’s birthday

by Fran Smith on April 23, 2009

in Culture

shakespeare1

‘Though there’s uncertainty about the exact date, April 23 is observed as William Shakespeare’s birthday, and Reason’s Nick Gillespie and National Review Online celebrate the Bard. Here’s a quote for today:

Neither a borrower nor a lender be,
For loan oft loses both itself and friend,
And borrowing dulls the edge of husbandry.

(Hamlet, Polonius)

Torture Prosecutions for Thee, But Not for Me

by Hans Bader on April 23, 2009 · 1 comment

in Bailout Watch, Economy, International, Legal, Personal Liberty, Politics as Usual, Sanctimony, Stimulus to Nowhere

House Speaker Nancy Pelosi wants Bush Administration officials prosecuted for facilitating torture. Fair enough. But if they get prosecuted, she should get prosecuted, too. She knew of the torture and knowingly funded the very programs that engaged in it. She only objected to it after Bush’s poll ratings went down.

Andrew Sullivan, who detests the Bush Administration, observes that “The Speaker was briefed on waterboarding and other torture techniques used by the White House. She was part of the select group of congressmen and women told of the program. She did nothing to stop it.” Indeed, said the CIA’s Porter Goss, “Not only was there no objection, there was actually concern about whether the agency was doing enough” to extract confessions.

Similarly, lawyer John Hinderaker notes that Senator Diane Feinstein (D-Cal.), who wants to investigate the Bush Administration, “enthusiastically endorsed waterboarding and other ‘enhanced’ interrogation techniques back in the days” following 9/11.

Liberals like Pelosi can’t logically object to being held responsible for “aiding and abetting” torture by knowingly funding it, without engaging in hypocrisy. After all, they support punishment based on very broad theories of “aiding and abetting.” For example, liberals support the massive, and worthless, $400 billion Alien Tort Claims Act lawsuits against American companies that did business in South Africa, under the theory that merely by selling products in South Africa, the companies thereby “aided and abetted” South Africa’s apartheid regime — never mind that South Africa’s current, democratically-elected, black-majority government is utterly opposed to these lawsuits, and that the companies now being sued complied with a set of human-rights principles known as the “Sullivan Principles” while operating in South Africa.

Torture produced lots of false information that wasted the CIA’s time and money, and produced bogus orange alerts that inconvenienced travelers. But the creepy Dick Cheney is still defending torture, making claims that are as illogical as his ridiculous claim (now echoed by the Obama Administration, which is running up record deficits in violation of Obama’s disingenuous “net spending cut” pledge) that “deficits don’t matter.”

Obama has been vague about the possibility of torture prosecutions. He seemed open to them on Tuesday, but not on Thursday “when it became apparent that any investigation would . . . include Congressional Democrats who signed off on the interrogations.”

While Andrew Sullivan is to be commended for not deliberately overlooking liberal complicity in the Bush Administration’s torture (the way most bloggers advocating torture prosecutions have), he has been less consistent in his attempts to defend the policies of the Obama Administration, such as his attacks on the tea-party anti-tax protesters.

Sullivan erroneously attacked the tea parties as “opposition to the Obama administration’s spending plans, manned by people who made no serious objections to George W. Bush’s” — even though the protests focused on the bailouts as well as the $800 billion stimulus package, which the Congressional Budget Office says will actually shrink the economy in the long run.

But after it became clear that many of the protesters had opposed the costly bailouts over the past year, including the Wall Street and auto bailouts during the Bush Administration, Sullivan switched gears to defend that wasteful spending, which even many original supporters of the bailouts now regret (and which even Treasury Secretary Geithner, an architect of the bailouts, admits have had “mixed” results). Sullivan now attacks the tea party protesters because they OPPOSED the bank bailout last year pushed through by the Bush Administration.

To Sullivan, criticism of Obama’s wasteful spending seems suspect regardless of whether the critic supported or opposed Bush’s fiscal policies.

Sullivan, the self-described “fiscal conservative” and believer in “limited government,” now supports Obama’s massive $800 billion stimulus package, sneering at people who “think the recession demands no fiscal stimulus” — seemingly oblivious to the Congressional Budget Office’s finding that Obama’s pork-filled stimulus package will actually shrink the economy in the long run by exploding the national debt.

Andrew Sullivan, not the tea party protests, was once a cheerleader for one of the most costly items on George Bush’s agenda: the 2003 invasion of Iraq. Today, with the benefit of hindsight, Sullivan bashes Bush for invading Iraq. But Sullivan long advocated invading Iraq before Bush did so, at times even chiding Bush for his perceived slowness to act against Saddam Hussein. Ironically, he now trumpets the idea of prosecuting Bush Administration officials. He cites the Administration’s use of torture, which I have also repeatedly criticized; but one of those Sullivan wants prosecuted, Doug Feith, staunchly opposed the use of torture. Feith’s real sin was to espouse the same cause Sullivan once did with such zest: the perfectly lawful, although extremely costly, invasion of Iraq.

Sullivan may variously claim to be conservative or libertarian in an effort to lend weight to his endorsement of big-spending liberal politicians like John Kerry and Barack Obama, but it would be more accurate to describe him, as Forbes magazine did, as a liberal journalist.

Comedic highlights of the Waxman-Markey bill hearing

by Marlo Lewis on April 23, 2009 · 2 comments

in Global Warming, Sanctimony

File these vignettes among the endless list of political inanities that would be uproariously funny if the potential economic fallout were not so toxic.

Yesterday, in honor of Earth Day, House Energy & Commece Chairman Henry Waxman (D-CA) held an interminable hearing on global warming legislation that he and Rep. Ed Markey (D-CA) have drafted.

Ranking Member Joe Barton of Texas today issued a press release providing some comedic highlights from the proceeding. A grim green award goes to anyone who can read it without laughing. 

Scenes from an Earth Day Hearing, Part II
House Energy & Commerce Committee, April 21-23

April 23, 2009

Is $8 gas good or bad? Energy Secretary: ‘Yes’

REP. CLIFF STEARNS, R-Fla.: Last September you made a statement that somehow we have to figure out how to boost the price of gasoline to the levels in Europe, which at the time exceeded $8 a gallon. As Secretary of Energy, will you speak for or against any measures that would raise the price of gasoline?
SEC. CHU: As Secretary of Energy, I think especially now in today’s economic climate it would be completely unwise to want to increase the price of gasoline. And so we are looking forward to reducing the price of transportation in the American family. And this is done by encouraging fuel-efficient cars; this is done by developing alternative forms of fuel like biofuels that can lead to a separate source, an independent source of transportation fuel.
REP. STEARNS: But you can’t honestly believe that you want the American people to pay for gasoline at the prices, the level in Europe?
SEC. CHU: No, we don’t.
REP. STEARNS: No. But somehow, your statement, “Somehow we have to figure out how to boost the price of gasoline to the levels in Europe,” doesn’t that sound a little bit silly in retrospect for you to say that?
SEC. CHU: Yes.

Huh? What was the question? Nukes? Ah…, we’ll…uh…work on it…hmmm.

REP. STEARNS: The first question I have is, this is directed to the Secretary of Energy. During your confirmation hearing, you testified that DOE has a legal obligation to safely dispose of nuclear waste. You said, “I’m supportive of the fact that the nuclear industry is and should have to be part of our energy mix in this century.” Doesn’t it concern you then that nuclear energy does not even seem to be a part of this bill? I think this is a follow-up to Mr. Upton’s question.
SEC. CHU: Well, while not specifically part of this bill, if you look at the sum package of all the bills like the American Recovery Act, nuclear energy is supported in those other bills.
REP. STEARNS: But don’t you think there should be a separate title in this bill for nuclear energy? Just yes or no.
SEC. CHU: Pardon? What was the question?
REP. STEARNS: Do you think there should be a separate title in this bill for nuclear energy? Just yes or no.
SEC. CHU: We’re looking forward to working with the committee on –
REP. STEARNS: No. Just yes or no. Do you think it should be? Can I have your yes or no answer?
SEC. CHU: A separate title in nuclear energy?
REP. STEARNS: Yes. Yes or no?
SEC. CHU: I think nuclear energy can be mentioned in this bill, but again it’s working with this committee and the administration in developing –
REP. STEARNS: Is that a “no” then? You don’t think that –
SEC. CHU: No. That was a, that was a – we will look forward to working with the committee and making sure that nuclear energy is part of our energy mix.

Green jobs go missing

REP. ED WHITFIELD, R-Ky.: I wanted to ask you all, you Mr. Chu particularly and Ms. Jackson, if you had read Gabriel Alvarez’ study – he’s at King Juan Carlos’s University in Madrid. And he used empirical data based on the government subsidizing renewable energy in Spain. And he came up with the conclusion exactly how much every job cost. And I know that President Obama in this renewable energy package is modeling using Spain as a model, one of the models. But for every job created in the renewable energy sector, so-called green job, that they lost 2.2 jobs. And this is a 50-page empirical study that he conducted. And I was just, have either one of you seen his study?
MS. JACKSON: No. I’m not familiar with his study….

We didn’t model that

REP. STEVE SCALISE, R-La.: Administrator Jackson, in your opening statement you talked about the jobs that would be created – green jobs that would be created under a cap-and-trade bill. Can you quantify how many jobs you estimate would be created under this legislation?
MS. JACKSON: I believe what I said, sir, is that this is a jobs bill and that the discussion draft bill in its entirety is aimed to jumpstart our move into the green economy.
REP. SCALISE: And I think you quoted President Obama saying that it was his opinion that he would – that this bill would create millions of jobs. I think you used the term “millions.” Is there anything that you can base your determination on how many jobs will be created?
MS. JACKSON: EPA has not done a model or any kind of modeling on jobs creation numbers.

Doomsday comes early to Ohio

REP. SCALISE: And, I mean, while you might not be a jobs expert, you’re obviously talking about, you know, and touting this bill as a jobs bill. If you would claim that it would create jobs, are you making an assumption that it won’t lose any jobs, that no jobs will be lost? Or if you don’t make that claim, how many jobs would you expect to be lost? Because groups have made very large claims. I mean, the National Association of Manufacturers claims our country would lose 3 to 4 million jobs as a result of a cap and trade energy tax.
So I just wanted to know if you or any members of the panel want to answer that question.
MS. JACKSON: I’ll go first and –
(Cross talk.)
REP. SCALISE: – if you would.
MS. JACKSON: I know that lobbyists keep playing large doomsday scenarios – quiet deaths for businesses across the country. That’s what lobbyists said about the Clean Air Act in 1990 and it didn’t happen. In fact, the U.S. economy grew 64 percent…
…REP. JOHN SHIMKUS, R-Illinois: Let me ask Administrator Jackson. Do you know how many jobs – coal miner jobs were lost in Ohio because of the Clean Air Act amendments which you were addressing earlier?
MS. JACKSON: No, sir.
REP. SHIMKUS: Thirty-five-thousand.

I know what the policy is because I saw it on the TV

EPA ADMINISTRATOR. JACKSON: The administration has no goal that is nefarious for coal. The president, on TV, in ads I see him talking about clean coal and how clean coal is crucial not only for the environment but to create jobs…

These buffooneries speak for themselves. The only comment I’d like to add is that Ms. Jackson should watch television (or Youtube) more often. Evidently, she missed these clips in which presidential candidate Obama acknowledged that his cap-and-trade plan would “necessarily” cause electricity prices to “skyrocket” and “bankrupt” anyone foolish enough to invest in new coal generation.

General Growth Properties (GGP) — Bankruptcy the way it ought to be

by John Berlau on April 23, 2009

in Bailout Watch, Culture, Deregulate to Stimulate, Politics as Usual, Precaution & Risk

On the surface, given the economic turmoil we’ve had, there was nothing that remarkable about the bankruptcy of shopping mall owner General Growth Properties (GGP). Late last week, GGP filed for Chapter 11 bankruptcy, an action that some had been expecting for months  given its debt of almost $25 billion.

GGP was the second largest mall owner in the country — with properties including Chicago’s Water Tower and the DC area-Tyson’s Gallleria – and filed for what has been described the biggest U.S. real estate bankuptcy ever. Yet the bankruptcy barely made a ripple in the stock market, which was up last Thursday the 16th, the day of its filing. And most of its malls, according to various local press reporties, operated as if nothing had changed.

Yet, in another way, the fact that this bankruptcy has so far gone off so smoothly is itself remarkable. Given the stretched definition of “systemic risk” and firms “too big to fail,” GGP would seem to meet that definition, at least as much as General Motors and Chrysler do. After all, thousands of stores and restaurants are anchored at malls, and if their landlord has cash flow troubles, these businesses and their employees could certainly suffer. For months, there had been talk that the commercial real estate was next on the list to be bailed out.

But perhaps sesnsing the “bailout fatigue” of American taxpayers and the strings attachted to money received from TARP, GGP’s owners and creditors decided to take the road less traveled. Or rather the road most often traveled by failing firms until the federal government opened its spigots last year. They filed for an old-fashioned Chapter 11 bankruptcy. And except for court costs — minimal in comparison to the billion-dollar bailouts – there is no taxpayer money involved.

Because of various raps against bankruptcy rather than bailouts, it’s worth going through the mechanics of the GGP bankruptcy, to show how they disprove them. One argument that has been made against a car company bankruptcy is that in these times of tightened credit, it would be impossible to get debtor-in-possesion, or DIP financing. DIP is necessary to finance a company’s operating costs while the court is reorganizing the company under the Chapter 11 proceedings. Yet GGP shows that large amounts of DIP financing are available — for a price.

 According to the New York Times, “General Growth will pay 12 percent over the London interbank offered rate, a commonly cited reference rate for bank lending.” The DIP loan is coming from Pershing Square Capital Management, the hedge fund run by William Ackman. And that price — though steep — is one that GGP shareholders and creditors see as well worth the price, given that it could facilitate a successful reorganization of the company that would be in everyone’s interest.

Ackman has been most often been noted for betting against companies in the real estate boom — and being spectacularly right.  As I wrote in Reason, Ackman “provided some of the earliest warnings about flaws in mortgage lending, securitization models, and the credit ratings process.” One of the ways Ackman would make his bets was by both shorting the stocks of financial firms and buying the much-derided credit default swaps that pay off in the event of firms’ default. Those swaps paid off handsomely when firms went belly up.

Ackman also bought swaps against GGP, and there has been criticism implying that some creditors pushed the company  into bankruptcy so that the swaps would pay up. Not mentioning Ackman by name,  columnist Daniel Gross writes in Slate about the supposed “scary rise of the empty creditor,” arguing that  ”if a lender or creditor believes it can profit more from a complete failure—i.e., if it has an insurance policy that pays off only in the event of utter devastation—that creditor might be more inclined to push a company toward bankruptcy.” Echoing an earlier assertion by the Financial Times that “CDS holdings were … a factor in the default and filing for Chapter 11 protection” of GGP, Gross claims that “the logic of empty creditors may similarly have been a reason why [GGP] ended up filing for Chapter 11.”

A couple problems with these complaints, in particular if they are directed at Ackman. One is that, according to the SEC filings as as reported by the investor web site SeekingAlpha.com, the GGP swaps Ackman holds don’t appear to be actual credit default swaps. Instead, they are based on “share price performance” of the company’s common stock. So an actual bankruptcy wouldn’t have made as much of  a difference as a low share price.

Second, if Ackman wanted to profit solely from General Growth’s poor performance, he could have simply walked away when the company filed for bankruptcy or the stock tanked. Instead, he is now betting that the company will have a successful reorgnization by lending it money to facilitate an orderly bankruptcy. The loan may have lucrative terms, but Ackman is still taking a risk that the company will fail. He simply hedged his risks with some swaps.

The most important point is that Ackman, with 25 percent of the company’s stock, as well as any other potential holders of  GGP swaps would not have been able to convince the other shareholders and creditors to go along with the bankruptcy unless it offered something beneficial for all parties. What does bankruptcy offer GGP?  What bankruptcy offers all filers: a chance to say “time out” to the creditors while the company is being reorganized. When asked if there was a danger that GGP would have to sell its properties at fire sale prices to rvial firms, Ackman told Bloomberg News, “The probability of … the other mall REITs buying any of General Growth Properties on the cheap is zero. They’re not going to be forced to do anything because they’re in bankruptcy.”

Isn’t it ironic? GM takes billions in bailout money as a preferred alternative to a “disorderly” bankruptcy. Yet it now may end closing its plants for several weeks. Yet not one mall has closed so far after GGP has taken the plunge into bankruptcy. This is in signficant part because the baliout money for the car companies has actually been an impediment to effective restructuring.

As I have stated previously on the auto bailouts, “The prospect of an ever-increasing supply of tax dollars is leading parties with auto industry contracts – unions, bondholders, dealers and others – to play a game of chicken. No one wants to renegotiate a contract when they think the government will come in with more money to cover the losses. And the Obama administration, as with AIG, does not have the power of a bankruptcy court to discharge debt. ”

So kudos to Ackman and the other GGP parties for finding an innovative solution for bankruptcy and restructuring without bailout money from taxpayers. And maybe if the option of bailout money is completely cut off, as it should have been in the first place, a private sector innovator like Ackman will appear to lead an orderly reorganization of the auto industry.

Obama credit card meeting — should meet with economists instead

by John Berlau on April 23, 2009

in Bailout Watch, Deregulate to Stimulate, Mobility, Nanny State, Politics as Usual, Precaution & Risk, Zeitgeist

Instead of meeting with the executives of credit card issuers and sactimoniously lecturing them about not raising rates, as he is doing today,  President Obama would serve card holders more effectively by meeting with economists and listening to their concerns about the dangers of price controls on credit card services. Economists from all schools of thought — from Keynesian to supply-side — recognize the basic principle of microeconomics that price controls lead to shortages of  commodities, including credit, and cause distortions that harm ordinary consumers.

Limits on risk-based pricing, as enacted in rules last year from the Federal Reserve, and in proposals in Congress that go beyond these rules, could result in sharp limits in the availability of credit at  a time when policy makers want to get credit flowing again. Recent cuts in consumers’ lines of credit over the past few months are in part responses to thes Fed rules that ban sensible risk-based pricing practices, such as the so-called “universal default.” Under this longstanding practice, credit card issuers would sometimes raise rates for defaults on another credit card or loan, because this may have signaled a weakeniong in a consumer’s credit profile. Now with the looming ban of this practice, credit card issuers may be reacting by limiting credit lines for all card holders because of the loss of the ability to engage in this type of risk-based pricing. So responsible card holders who never miss a payment are paying the price for these misguided rules.

And consumers and the economy will pay an even higher price if further restrictions are enacted such as proposed caps on annual percentage rates. Politicians don’t seem to grasp that expanding credit responsibly is incompatible with limiting risk-based pricing. Again, responsible card holders — some of whom don’t even pay interest because they completely pay off their balances — could lose out in the form of the return of annual fees and the loss of credit card “rewards” such as airline miles to make up for the costs from bans on risk-based pricing.

President Obama may also want to read studies sponsored by the respected Kauffman Foundation in Kansas City, Mo., that find that personal credit cards are a major source of funding for startup entrepreneurs. Most famously, Sergey Brin used personal credit cards as a college student in the 1990s to start the web search engines that is today know as Google.

In some instances, credit cards have been issued foolishly by banks and used foolishly by consumers. Fraud in credit card practices should be punished just as fraud is in any type of business. But there should not be a “Nanny State” standing between willing lenders and willing consumers who desire to lend and borrow at agreed-upon rates. Otherwise, the enterprises of the future Sergey Brins may be snuffed out from the lack of innovation in credit.

Diamond in the rough?

by Fran Smith on April 22, 2009 · 2 comments

in International

Hmm. A Papua New Guinea tribesman is suing the The New Yorker magazine over an article penned by MacArthur “Genius” and Pulitzer Prize winning author Jared Diamond. The $10-million suit claims that Diamond falsely accuses the tribesman and another colleague of criminal acts, including murder, in a bloody revenge tale.

While PNG tribesman Daniel Wemp admitted telling stories to Diamond and others, a friend of his said that it’s common practice:

When foreigners come to our culture, we tell stories as entertainment. Daniel’s stories were not serious narrative, and Daniel had no idea he was being interviewed for publication.

My brother-in-law and his wife spent eight years in PNG in isolated villages. They often recounted how the villagers would tell them stories they insisted were true – in most cases, for good-natured entertainment to see how gullible the Americans were. John and Kim soon learned to recognize and enjoy being the butt of the jokes.

I’m reminded of anthropologist Margaret Mead’s acclaimed work “Coming of Age in Samoa,” which celebrated sexual openness among Samoan adolescents. Some scholars have dismissed those claims as untrue, arguing that the 23-year-old Mead herself may have been told “stories” by the young people she interviewed.

Jared Diamond is celebrated for his “Guns, Germs, and Steel,” but I was appalled by the tunnel-vision approach in his more recent book “Collapse: How societies choose to fail or succeed,” in which he claims overuse of resources led to the collapse of several societies and should serve as a warning for our current societies. For an excellent critique of Diamond’s “Collapse,” read Ron Bailey’s article, “Under the spell of Malthus.”

Diamond is also celebrated for his ornithological studies in PNG. Maybe he needs to spend more time studying humans to recognize when he’s being gulled.

Unions Disunited — and Fighting

by Ivan Osorio on April 22, 2009

in Economy, Labor

The civil war between the two factions that until recently made up the union UNITE-HERE heated up further this week. Yesterday, the leadership of the rump UNITE-HERE voted to suspend the union’s general president, Bruce Raynor, who led a dissident faction out of the union. Raynor’s group incorporated as a new union, Workers United, which is now affiliated with the Service Employees International Union (SEIU), as a “conference” of SEIU. Today, UNITE-HERE followed up with a protest outside SEIU’s Washington, D.C., headquarters, at which UNITE-HERE claims it had 300 people. SEIU, for its part, is accusing UNITE-HERE of suppressing dissent and of trying “to raid Workers United and SEIU” for new members.

UNITE-HERE was the result of the 2004 merger between the Union of Needletrades, Industrial & Textile Employees (UNITE), which was headed by Raynor, and the Hotel Employees and Restaurant Employees (HERE), headed by John Wilhelm, who now heads the current version of UNITE-HERE. Before the split, Wilhelm headed the union’s hospitality division.

Earlier this year, Raynor accused Wilhelm of trying to take over what had been UNITE’s resources, which were greater than those of the former HERE, whose hospitality constituency showed greater possibility for unionizing large numbers of workers. This combination of more workers to organize (HERE) and greater resources (UNITE) created the alleged synergy that brought the two unions together in the first place. Now the fight has grown into a proxy war between the AFL-CIO, which UNITE-HERE has decided to rejoin, and SEIU President Andy Stern, who led his union out of the AFL-CIO in 2005 and formed his own labor coalition, Change to Win — of which UNITE-HERE was a member.

It’s hard to say what will come next, other than the Wilhelm/UNITE-HERE/AFL-CIO vs. Raynor/Workers United/SEIU fight is unlikely to cool down any time soon — especially with control over the former UNITE-HERE’s assets at stake, and Stern’s propensity to never relent in pursuit of his goals. As union activist Steve Early writes in the left-wing online journal Counterpunch:

With family jewels up for grabs (in the form of UNITE-HERE’s $4.5 billion Amalgamated Bank), guess which Purple Knight stood ready to unite with either or both of the estranged partners, as long the bank was part of the deal.

That’s not not chump change anyone will let go of easily.

For more on SEIU, see here.

“We don’t need no stinking baseload,” FERC Chairman

by Marlo Lewis on April 22, 2009

in Global Warming

Okay, Federal Energy Regulatory Commission (FERC) Chairman Jon Wellinghoff didn’t actually say America doesn’t need coal-fired and nuclear power plants. He stopped short of openly embracing the We Can Solve It! agenda of ”repowering” America” with zero-emissions, non-nuclear electricity in 10 years.  He is not an avowed apostle of Gorethodoxy.

But he’s close enough for government work. Wellinghoff told reporters (Greenwire, subscription required) that we “may not need any [new coal and nuclear power plants], ever.” One reason being that new coal plants will be “too expensive.” Huh?

If coal plants are too costly, then why have eco-litigation groups fought so hard to stop coal plants from being built?

Silly me, Wellinghoff undoubtedly means that once Congress enacts the Waxman-Markey cap-and-trade bill, it will be too expensive to own and operate a coal plant. 

Wellinghoff, after all, is a member of Team Obama, and when the President was a candidate, he candidly admitted that his cap-and-trade plan would cause electricity prices to “skyrocket” and would ”bankrupt” anyone foolish enough to invest in coal-based power.

Wellinghoff believes that wind, solar, and biomass are poised to take off as sources of “distributed” generation, turning coal and nuclear baseload power into an “anachronism.” Funny, that’s what eco-visionaries told us in the 1970s. Yet, despite decades of taxpayer and ratepayer support and market-rigging rules, non-hydro renewables today provide about 3% of all U.S. electric power.

Does it worry you that folks like Obama and Wellinghoff are the anointed stewards of our economy in these troubled times? It does me.

¿Can We Be Amigos?

by Anthony Atchison on April 22, 2009 · 1 comment

in International, Legal, Trade

The Fifth Summit of the Americas held in Trinidad and Tobago on April 17th shed light on America’s new role in the Western Hemisphere. The most controversial issue was President Obama’s welcoming attitude towards the Republic of Cuba. According to CBSnews.com, at the summit President Obama made it the issue there by stating:

We all have a responsibility to see that the people of the Americas have the ability to pursue their own dreams in democratic society… I have already changed a Cuba policy that has failed to advance liberty or opportunity for the Cuban people.

President Obama lifted the travel ban but has yet to lift the trade embargo. He wants this act to signify the beginning of a new open relationship between the two nations. The U.S. could approach this openness in three different ways: lift the tourism and trade embargo, offer lenient trade terms, or provide civilian and military aid during national disasters or external threats.

All these points sound good and many are saying, “Caesar’s better parts
Shall be crown’d in Obama” (Act 3 Scene 2). But why should our attitude toward Cuba change? There are two reasons, one is that the U.S. is willing to open negotiations with some concessions; or the Cuban government admits the errors they have committed and wants to open up a dialogue with concessions. The second option is what the US has always wanted: for the country of Cuba to hold peaceful and democratic elections, provide liberty and security for its citizens, and have cordial relations with other American nations. Few realize that Cuba is the only country in the Western Hemisphere that does not hold public elections on any level. The first option is what Cuba has always wanted: for the US to realize that its ongoing approach failed, That the US was not the sole power in the Americas, that socialism in Cuba and other Latin American countries worked exceptionally well and should be emulated or praised, and for Cuba to rule itself as it has for the last 60 years.

Neither series has occurred nor should President Obama support either unless he and President Raúl Castro come to certain agreements. Cuba is still the same communist country that it has been since Fidel Castro took over. The storming of the Peruvian Embassy on April 6, 1980 by ten thousand impoverished citizens , the Mariel boatlift, and the imprisonment during “Black Spring” all point to strife and unrest in a citizen suppressed country. In April 20’s Wall Street Journal Laura Meckler wrote,

‘Once the U.S. and Cuba are seated across the table, the Americans will realize that the Cubans are willing to talk but not to give anything up,’ said Brian Latell, a former Central Intelligence Agency Cuba analyst who has written a biography of Raúl Castro. Mr. Castro has made similar assertions before without following through. After taking over from his ailing brother in 2006, he promised a host of changes, few of which materialized.

Before a dialogue is opened between the US and Cuba, Cuba must recognize the need for change. It could start with President Obama asking the Castro brothers to believe in change. A dissolution of the old ways, a renewed pledge of peace and prosperity, a restructuring of an old state which used oppression, intimidation, and injustice to control a nation. I think that a correct and well timed impersonation of a strong leader with a vision such as Theodore Roosevelt would be appropriate now and could be more effective than an uninhibited open door policy with which other foreign leaders, as Hugo Chavez has shown, would misuse.

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