Dec 282011



By Matt Taibbi, Rolling Stone

A good friend of mine sent me a link to a small story last week, something that deserves a little attention, post-factum.

The Bloomberg piece is about J.P. Morgan Chase winning a bid to be the lead underwriter on a $400 million bond issue by the state of Massachusetts. Chase was up against Merrill for the bid and won the race with an offer of a 2.57% interest rate, beating Merrill’s bid of 2.79. The difference in the bid saved the state of Massachusetts $880,000.

Afterward, Massachusetts state treasurer Steven Grossman breezily played up the benefits of a competitive bid. “There’s always a certain amount of competition going on out there,” Grossman said in a telephone interview yesterday. “That’s good. We like competition.”

Well … so what, right? Two banks fight over the right to be the government’s underwriter, one submits a more competitive bid, the taxpayer saves money, and everyone wins. That’s the way it ought to be, correct?

Correct. Except in four out of five cases, it still doesn’t happen that way. From the same piece [emphasis mine]:

Nationwide, about 20 percent of debt issued by states and local governments is sold through competitive bids. Issuers post public notices asking banks to make proposals and award the debt to the bidder offering the lowest interest cost. The other 80 percent are done through negotiated underwriting, where municipalities select a bank to price and sell the bonds.

By “negotiated underwriting,” what Bloomberg means is, “local governments just hand the bid over to the bank that tosses enough combined hard and soft money at the right politicians.” […]




By Washington’s Blog

Is the Tide Turning on SOPA?

While a short week ago the Internet censorship bill – SOPA – looked certain to pass, the tide appears to be quickly turning.

Politico notes today:

The conservative and liberal blogospheres are unifying behind opposition to Congress’s Stop Online Piracy Act, with right-leaning bloggers arguing their very existence could be wiped out if the anti-piracy bill passes.

“If either the U.S. Senate’s Protect IP Act (PIPA) & the U.S. House’s Stop Online Piracy Act (SOPA) become law, political blogs such as Red Mass Group [conservative] & Blue Mass Group [liberal] will cease to exist,” wrote a blogger at Red Mass Group.


“Some good news on the SOPA front: Its corporate base of supporters is starting to crumble,” David Dayden wrote at Firedoglake. “GoDaddy is not alone. Scores of law firms are requesting their names be removed from the Judiciary Committee’s official list of SOPA supporters.”

In the blogosphere, the trajectory of the bill seemed set — that it is destined for failure if the pressure of the online community is kept up.

“The dynamic is clear. Once SOPA — and its Senate counterpart, Protecting IP Act, or PIPA — became high-profile among the Internet community, the lazy endorsements from companies and various hangers-on became toxic. And now, those supporters are scrambling, hollowing out the actual support for the bill. Suddenly, a bill with ‘widespread’ corporate support doesn’t have much support at all,” Dayden said.

Conservatives took a slightly different tact, though with similar disdain for the anti-piracy measures.

Indeed, blogger Erick Erickson said that he would encourage a primary for any Republican who supports the bill.

“I love Marsha Blackburn. She is a delightful lady and a solidly conservative member of Congress. And I am pledging right now that I will do everything in my power to defeat her in her 2012 reelection bid” due to her co-sponsorship for SOPA, Erickson wrote at RedState. “Congress has proven it does not understand the Internet. Perhaps they will understand brute strength against them at the ballot box. If members of Congress do not pull their name from co-sponsorship of SOPA, the left and right should pledge to defeat each and every one of them.” […]




By Glenn Greenwald, Salon

American presidential elections are increasingly indistinguishable from the reality TV competitions drowning the nation’s airwaves. Both are vapid, personality-driven and painfully protracted affairs, with the winners crowned by virtue of their ability to appear slightly more tolerable than the cast of annoying rejects whom the public eliminates one by one. When, earlier this year, America’s tawdriest (and one of its most-watched) reality TV show hosts, Donald Trump, inserted himself into the campaign circus as a threatened contestant, he fitted right in, immediately catapulting to the top of audience polls before announcing he would not join the show.The Republican presidential primaries – shortly to determine who will be the finalist to face off, and likely lose, against Barack Obama next November – has been a particularly base spectacle. That the contest has devolved into an embarrassing clown show has many causes, beginning with the fact that GOP voters loathe Mitt Romney, their belief-free, anointed-by-Wall-Street frontrunner who clearly has the best chance of defeating the president.In a desperate attempt to find someone less slithery and soulless (not to mention less Mormon), party members have lurched manically from one ludicrous candidate to the next, only to watch in horror as each wilted the moment they were subjected to scrutiny. Incessant pleas to the party’s ostensibly more respectable conservatives to enter the race have been repeatedly rebuffed. Now, only Romney remains viable. Republican voters are thus slowly resigning themselves to marching behind a vacant, supremely malleable technocrat whom they plainly detest. […]




Wall Street has destroyed the wonder that was America.

By Michael Thomas, The Daily Beast

Imagine a vast field on which a terrible battle has recently been fought, the bare ground cratered by fusillade after fusillade of heavy artillery, trees reduced to blackened stumps, wisps of toxic gas hanging in the gray, and corpses everywhere.

A terrible scene, made worse by the sound of distant laughter, because somehow, on the heights commanding the dead zone, the officers’ club has made it through intact. From its balconies flutter bunting, and across the blasted landscape there comes a chorus of hearty male voices in counterpoint to the wheedling of cadres of wheel-greasers, the click of betting chips, the orotund declamations of a visiting congressional delegation: in sum, the celebratory hullabaloo of a class of people that has sent entire nations off to perish but whose only concern right now is whether the ’11 is ready to drink and who’ll see to tipping the servants. The notion that there might be someone or some force out there getting ready to slouch toward the buttonwood tree to exact retribution scarcely ruffles the celebrants’ joy.

Ah, Wall Street. As it was in the beginning, is now, and hopes to God it ever will be, world without end. Amen.

Or so it seems to me. It was in May 1961 that a series of circumstances took me from the hushed precincts of the Metropolitan Museum of Art, where I was working as a curatorial assistant in the European Paintings Department, to Lehman Brothers, to begin what for the next 30 years would be an involvement—I hesitate to call it “a career”—in investment banking. I would promote and execute deals, sit on boards, kiss ass, and lie through my teeth: the whole megillah. In consequence of which, I would wear Savile Row and carry a Hermès briefcase. I had Mme. Claude’s home number in Paris and I frequented the best clubs in a half-dozen cities. But I had a problem: I was unable to develop the anticommunitarian moral opacity that is the key to real success on Wall Street.

I had my doubts from the beginning. A few months after I started to work downtown, I ran into an old friend from college and before, a man later to become one of New York’s most esteemed writers and editors.

“So,” he asked, “how do you like what you’re doing now?”

“I like it quite a lot,” I said. And this was true: these were new frontiers for me, the pace was lively, the money was good enough ($6,500 a year), and there was so much to learn. But there was one aspect of Wall Street that I found morally confusing if not distasteful: “There’s one thing that bothers me, though. It’s this: on the one hand the New York Stock Exchange has sent its president, the estimable G. Keith Funston, out into the countryside, supported by an expensive, extensive advertising campaign, to exhort the proletariat to Own your share of America! As if buying 50 shares of IBM or GM in 1961 is as much of a civic duty as buying a $100 war bond in 1943.”

I then added, “But here’s the thing. At the same time as Funston’s out there doing his thing, if you ask any veteran Wall Street pro how the Street works, the first thing he’ll tell you is: The public is always wrong. Always.” I paused to let that sink in, then confessed, “I have to tell you, I have trouble squaring that circle.”

And that was back when Wall Street was basically honest, brought into line thanks in part to Ferdinand Pecora’s 1933 humiliation of the great bankers of the Jazz Age and even more so because of the communitarian exigencies forced on the nation by war. From Pearl Harbor to V-J Day, greed was definitely not good, and that proscriptive spirit lingered on right up to 1970, when everything started to change, and the traders began their long march through our great houses of finance, with the inevitable consequence that the Street’s moral bookkeeping grew more and more contorted, its corruptions more elaborate, its self-interest less and less governable. What someone has called the “Greed Wars” began. […]




By Victoria Collier and Ronnie Cummins, Truthout

[…] So, do elections matter anymore? Is representative democracy for the People even possible?

Wherever you are on the revolutionary road, whoever you are in your mind and soul, we ask you to please listen to the message we’re conveying today, and consider how it impacts your activism in the coming year.

American elections are not going away any time soon. They are rigged, and we must end the rigging – for the sake of our planet and its 7 billion people, entwined in complex technological and social systems that do require some form of representative government to function.

Our electoral process is rigged in the following ways:

The battle to topple the corporatocracy must strategically attack all of these points. But for the purpose of this call to action – Occupy Rigged Elections – we’re going to focus on the last, least understood bullet point: computerized election fraud.

In the end, how ballots are counted – the central control mechanism of democracy – could prove the easiest piece to reclaim; our first real step toward radically shifting power back toward the people.

Computerized Vote Rigging Is a Democratic Cancer

Undiagnosed, spreading through our nation’s bones, centralized election rigging has been undermining the health of our democracy for decades, eating away at it from within, leaving us exhausted and hopeless – though unsure of why we’re so sick.

But let’s get something clear up front: not every election is rigged, so don’t be confused by the few decent people who managed to get into office and stay there. First, ask yourself this question: Have they stopped the corporatist takeover? The answer is no.

Pay attention to the balance of power; watch it tipping ever further toward the corporatist/fascist side of the scale. Meanwhile, the spectacle of democracy maintains a pacified public. In other words, they will let some of “our” people in, or let some of our initiatives pass, while they keep winning more power, overall. Additionally – not all elections are easy to rig, and some have far higher stakes. But there is one constant in the equation:

Every election can be rigged. Undetectably.

If this is news to you, hang on to your hat. Once you understand how the machinery of the American voting system actually works, you’re going to feel a little stunned, as if you came home from a three month vacation to discover you left your keys hanging in the front door.

Over the past 40 years – since computers first came online for use in processing and reporting votes – our secretaries of state and election supervisors have literally sold our democratic system to a small criminal cadre of extreme right-wing and religious ideologues who lurk behind shady voting machine companies. The top three are Diebold (purchased by ES&S in 2009), ES&S, and Sequoia Pacific (purchased by Dominion). They manufactured the majority of voting machines and software that secretly count our ballots. […]




By Katherine Goldstein/Gazelle Emami, HuffPo

In a study released by the International Journal of Biological Sciences, analyzing the effects of genetically modified foods on mammalian health, researchers found that agricultural giant Monsanto’s GM corn is linked to organ damage in rats.

According to the study, which was summarized by Rady Ananda at Food Freedom, “Three varieties of Monsanto’s GM corn – Mon 863, insecticide-producing Mon 810, and Roundup® herbicide-absorbing NK 603 – were approved for consumption by US, European and several other national food safety authorities.”

Monsanto gathered its own crude statistical data after conducting a 90-day study, even though chronic problems can rarely be found after 90 days, and concluded that the corn was safe for consumption. The stamp of approval may have been premature, however.

In the conclusion of the IJBS study, researchers wrote:

“Effects were mostly concentrated in kidney and liver function, the two major diet detoxification organs, but in detail differed with each GM type. In addition, some effects on heart, adrenal, spleen and blood cells were also frequently noted. As there normally exists sex differences in liver and kidney metabolism, the highly statistically significant disturbances in the function of these organs, seen between male and female rats, cannot be dismissed as biologically insignificant as has been proposed by others. We therefore conclude that our data strongly suggests that these GM maize varieties induce a state of hepatorenal toxicity….These substances have never before been an integral part of the human or animal diet and therefore their health consequences for those who consume them, especially over long time periods are currently unknown.” […]




By Mike Masnick, techdirt

Over the summer, we wrote about a ridiculous new lobbying effort, led by the author of the DMCA, Bruce Lehman, to create an artist resale right in the US. We’ve discussed similar plans found elsewhere, and there’s no way to describe them other than as a ridiculously bad idea. It’s basically an attempt to have artists get paid multiple times for the same piece of work, without anyone planning these things by talking to an economist about how badly that will backfire. Either way, it looks like the lobbying effort has succeeded so far, as Rep. Jerrold Nadler and Senator Herb Kohl, have introduced bills to create such a right across the US in both the House and the Senate.

Basically, the idea is that after an artist sells a work, if the work is later resold, the artist gets a piece of the proceeds. The economically clueless thinking behind this is that artists sell works off when they’re unknown and starving for little money… but then when they become famous, it seems only “fair” that the artist should get a cut of the multi-million dollar sale of their artwork. Except that ignores common sense and reality (is it any wonder that it was easy to find two politicians to support such a plan?). First of all, artist resale rights harm artists. That’s because it now makes it more expensive for anyone to invest in art, knowing that they get less on every resale, because some has to go back to the artist. Any time you make it more expensive for people to invest in young artists, you harm those artists.

More importantly, this only helps already super successful artists, because they’re the only ones who make money off of this. The Nadler and Kohl bills only apply to sales of artwork over $10,000. If an artist has works that are selling for that much they’re already super successful and can make a lot more money by simply making new art and selling it themselves. In other words, once you’ve reached the stage where your old art is selling for $10,000, you shouldn’t be relying on an artist resale right anyway. You should be making new art and selling it for a lot of money directly and cashing in. […]





The United States has a passion for pills, being the world’s biggest users of psychotropic drugs, consuming 60 per cent of them. And pharmaceutical firms are keen to keep cashing in on the multibillion-dollar market, even if it costs people’s health.

America is regarded as a country with a prodigious appetite for consumption. Today, a widespread fondness for pharmaceuticals has turned the US into a nation of pill-poppers.

With over $14 billion in annual sales, antipsychotics remain the top-selling therapeutic class of prescription drugs in the US.

Dr. Harriet Fraad believes Big Pharma has manufactured a climate of insanity by manipulating and even creating illness for capital gain.

“One of the things that drives Big Pharma is to find a diagnosis that is very vague, so that everybody can fall into that,” she told RT. “Everybody is sad sometimes. There are good reasons. The point is to market pharmaceuticals. And the advertising strategy is to have vague diagnosis and then find wiggle room so that they apply to everyone.”

The US is the only Western country that allows direct-to-consumer advertising of prescription drugs. For example, an ad for Attention Deficit Hyperactivity Disorder warns that untreated patients will likely end up divorced. Another commercial promises to make you happier, but side-effects may include dry mouth, insomnia, sexual dysfunction, diarrhea, nausea and sleepiness.”

Critics also say Big Pharma uses its financial muscle to ply doctors with gifts, cash kick-backs and research funding in exchange for endorsing or prescribing the latest and most lucrative drugs.

Harriet Fraad says there is a whole network of doctors hustling these drugs. […]




By Tyler Durden, Zero Hedge

Remember, back in the day, when a bankruptcy was simply called a bankruptcy? Naturally, this was well before ISDA came on the scene and footnoted the living feces out of everything by claiming that a bankruptcy is never a bankruptcy, as long as the creditors agree to 99.999% losses at gunpoint, with electrodes strapped to their testicles, submerged in a tank full of rabid piranhas, it they just sign a piece of paper (preferably in their own blood) saying the vaseline-free gang abuse was consensual. Well, now we learn that as the global insolvency wave finally moves to China, a bankruptcy is now called something even less scary: “deferred loan payments” (and also explains why suddenly Japan is going to have to bail China out and buy its bonds, because somehow when China fails, it is the turn of the country that started the whole deflationary collapse to step to the plate). After all, who in their right mind would want to scare the public that the entire world is now broke. Certainly not SWIFT. And certainly not that paragon of 8%+ annual growth, where no matter how many layers of lipstick are applied, the piggyness of it all is shining through ever more acutely. Because here are the facts, from China Daily, and they speaks for themselves: “China’s biggest provincial borrowers are deferring payment on their loans just two months after the country’s regulator said some local government companies would be allowed to do so….Hunan Provincial Expressway Construction Group is delaying payment on 3.11 billion yuan in interest, documents governing the securities show this month. Guangdong Provincial Communications Group Co, the second-largest debtor, is following suit. So are two others among the biggest 11 debtors, for a total of 30.16 billion yuan, according to bond prospectuses from 55 local authorities that have raised money in capital markets since the beginning of November.” So not even two months in and companies are already becoming serial defaulters, pardon, “loan payment deferrers?” And China is supposed to bail out the world? Ironically, in a world in which can kicking is now an art form, China will show everyone just how it is done, by effectively upturning the capital structure and saying that paying interest is, well, optional. In the immortal words of the comrade from Georgia, “no coupon, no problem.”

Our advice: go long Teva, which recently acquired Cephalon, and its wonderful drug Provigil, which is basically legalized cocaine, speed, meth and heroin all in one perfectly legal pill, as the newsflow, up until now only picking up with the idiot headlines out of Europe at 3 am Eastern is about to become one constant 24/7 flashing red rumor/disinformation mill. Also, next time someone wants to make THE drug cocktail of choice for the headline reacting speed trading junkie, please name it appropriately. Jeffrey will suffice. […]




By Bill Keller, NYTimes

IN the waning days of the Soviet Union, I spent a lot of time in a cluster of apartment towers along the Moscow River, contemplating what seemed to me an essential question about the future of our cold-war adversary: Could Russia grow an authentic middle class? Not a privileged class, favored wards of the state, but independent achievers who would be the engine and the evidence of upward mobility.

The place on the river was called a youth living complex, the product of a classically harebrained Young Communist League scheme to ease a housing shortage. Young professionals at important state enterprises — in this case mainly scientists from a nuclear research institute and engineers from the plant that manufactured the Russian version of the space shuttle — were given months away from their jobs to labor as an overeducated communal construction crew. Each family put in hundreds of hours pouring concrete and installing drywall, and then moved into a precious new apartment. The theory was that, liberated from sharing their parents’ overcrowded flats, forged into a contented new community, they would devote themselves even more loyally to their high-priority jobs.

But this was 1991, a time of possibilities. Many of the families in my little microcosm moved into their new homes in the youth living complex “Atom” and promptly quit their state jobs to join the new private sector. I followed a sample of Atom families as they tried to figure out the novelty of a self-reliant life.

(Meanwhile one of their contemporaries, Vladimir Putin, was winding up his own formative experience in the ultimate bastion of the state, the K.G.B. Colonel Putin’s last assignment for the spy agency was conducting surveillance on students at Leningrad State University.)

My favorite Atom dweller was a brawny, idealistic engineer named Igor. While most new capitalists practiced some form of wheeling and dealing — importing jeans, computers, rock albums — Igor was one of the few who had set out to make it as a private manufacturer. His plan was brilliant. People were suddenly making money, but they regarded the new private banks with suspicion. Igor retooled an old factory to produce high-quality safes.

For Russia, it was a time of confused quest, a longing to be normalniye lyudi — normal people. Thousands, including a contingent from Atom, had poured into the streets to face down an attempted coup by hard-liners, and to celebrate their newfound power. But then what? Everything from the rules of the marketplace to the meaning of life had to be improvised on the still-festering ruins of a monstrous failed experiment. Rackets abounded. Mystics and healers and hypnotists attracted huge crowds. In their search for something to believe in, Atom residents invited a priest to give weekly instruction on their closed-circuit TV channel. One resident, seeking a more secular kind of fulfillment, hosted a free-love commune.

Flash forward a decade, halfway to the present. The new Russia was still a work in progress. That obscure K.G.B. colonel was a popular president. Putin provided prosperity enough, a paternalistic sense of order and a reassuring narrative of national pride. The price — unless you represented a real threat to the regime, in which case the price could be very high indeed — was bearable: an unspoken acceptance of the way things are, a small surrender of dignity. Shut up, get rich.

For many, the endearing confusion of the early ’90s had given way to disillusionment. Robin Hessman’s splendid documentary “My Perestroika,” released last year, follows five Moscow friends a little younger than my Atom focus group. The film captures the ambivalence of those who straddled the Soviet days and the new freedom. They live reasonably well, they are free to say what they think, but something, some larger purpose, is missing. “You know,” says Borya, a high school history teacher, who had been at the barricades in 1991, “the ideals that burned in a person’s heart in the early ’90s, they were profaned, and there was nothing left to fight for.”

At Atom, the closed-circuit priest was gone, and a shiny new Reebok health club had been installed, with tanning beds and rows of elliptical machines, a haven of self-improvement in a land where the actuarial charts had always belonged to vodka and tobacco. The Atom grade school had dropped many of its experimental programs (and its free-thinking principal) in favor of a cram-for-success curriculum. My microcosm had scattered. A few had left for Canada, or Israel, or the U.S. A former Young Communist League apparatchik, who had been so officious at meetings of the housing complex in its early days, had found his natural calling in the cynical world of arms dealing.

Igor the safe-maker and his wife, Tanya, had struggled to learn the business ropes in a country that had no business ropes. Their company expanded and prospered. They moved to a bigger apartment, bequeathing the Atom unit to a daughter and son-in-law. Igor drove a Mercedes S.U.V. But they were uneasy with the soul-sucking consumerism and the corruption around them. Their great consolation was that their two daughters had chosen cultural accomplishment over commercial ambition — Maria as a painter of religious icons, Katya as a classical pianist.

Flash forward another decade. When tens of thousands massed in Moscow this month to protest questionable parliamentary elections and Putin’s high-handed manner, the news reports characterized it as a revolt of the middle class. My first thought was to track down Igor, my model new middle-classnik. […]




As a US marine who lost close friends in the siege of Fallujah in Iraq seven years ago, I understand that we were the aggressors

By Ross Caputi, Guardian UK

It has been seven years since the end of the second siege of Fallujah – the US assault that left the city in ruins, killed thousands of civilians, and displaced hundreds of thousands more; the assault that poisoned a generation, plaguing the people who live there with cancers and their children with birth defects.

It has been seven years and the lies that justified the assault still perpetuate false beliefs about what we did.

The US veterans who fought there still do not understand who they fought against, or what they were fighting for.

I know, because I am one of those American veterans. In the eyes of many of the people I “served” with, the people of Fallujah remain dehumanised and their resistance fighters are still believed to be terrorists. But unlike most of my counterparts, I understand that I was the aggressor, and that the resistance fighters in Fallujah were defending their city.

It is also the seventh anniversary of the deaths of two close friends of mine, Travis Desiato and Bradley Faircloth, who were killed in the siege. Their deaths were not heroic or glorious. Their deaths were tragic, but not unjust.

How can I begrudge the resistance in Fallujah for killing my friends, when I know that I would have done the same thing if I were in their place? How can I blame them when we were the aggressors?

It could have been me instead of Travis or Brad. I carried a radio on my back that dropped the bombs that killed civilians and reduced Fallujah to rubble. If I were a Fallujan, I would have killed anyone like me. I would have had no choice. The fate of my city and my family would have depended on it. I would have killed the foreign invaders.

Travis and Brad are both victims and perpetrators. They were killed and they killed others because of a political agenda in which they were just pawns. They were the iron fist of American empire, and an expendable loss in the eyes of their leaders.

I do not see any contradiction in feeling sympathy for the dead US Marines and soldiers and at the same time feeling sympathy for the Fallujans who fell to their guns. The contradiction lies in believing that we were liberators, when in fact we oppressed the freedoms and wishes of Fallujans. The contradiction lies in believing that we were heroes, when the definition of “hero” bares no relation to our actions in Fallujah.

What we did to Fallujah cannot be undone, and I see no point in attacking the people in my former unit. What I want to attack are the lies and false beliefs. I want to destroy the prejudices that prevented us from putting ourselves in the other’s shoes and asking ourselves what we would have done if a foreign army invaded our country and laid siege to our city. […]


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