Month: February 2009

Facebook: “Platform?” Or “Co-Owner”

Posted on by Liz

Plenty has  been written about recent changes in Facebook’s Terms of Use  (See: NY Times “Wrap-up”) but  the kerfuffle raises serious questions about the “concept” – the form, function and purpose — of platforms like Facebook and the relationship those platforms have to their users’ personal, private  “belongings.”  (The distinction between public and private is integral to the question because in law, if you tell friends in a public setting  that you’re a drug addict, you probably don’t have a cause of action when someone else repeats or publishes the information. Facebook users believed, rightly or wrongly, that they were sharing in a private or semi-private setting. Why?  Because Facebook is a private website with walls that provide for private sharing  in a way that The Huffington Post, for instance, would never conceive.)

Facebook acts like a giant convention center where people meet for private and  semi-private interactions.  We exchange things that matter to us with particular groups of people.  In support of that exchange, Facebook provides friendly rooms where, if we have permission, we can ooh and ah over each other’s photos, artistic efforts, political doings and  family events.  In terms of cyber-relationships, it’s a one-stop-shop or very like  hosting an open house for your friends and their invitees.

As a convention center, Facebook provides space and services.  However, it has broadened the concept of the host relationship to include joint ownership and control over the distribution rights of the personal thoughts and “objects”  we share within its walls.  For instance, Facebook can alter and distribute your images for profit/promotion.

Facebook says its rationale is based on user privacy settings.  If the owner of a photo displays it using the Facebook Photo application, by extension, the owner is giving Facebook the same distribution rights as the owner retains.

Imagine speaking at a family or class reunion and discovering  that the hosting  hotel  has the perpetual right to distribute what you say or the items you display.

Imagine showing your artwork in Central Park to a million strangers and having the City of New York lay claim to the distribution rights of that work.

Thousands of Facebook members imagined it and rebelled.  A few hours ago, Facebook notified our home pages that it will temporarily return to the old rules pending a review of customer concerns. The notice includes a link to a new group where members can suggest changes to the Terms of Use.

Facebook also posted the following reassurance:

1. You own your information. Facebook does not. This includes your photos and all other content.
2. Facebook doesn’t claim rights to any of your photos or other content. We need a license in order to help you share information with your friends, but we don’t claim to own your information.
3. We won’t use the information you share on Facebook for anything you haven’t asked us to. We realize our current terms are too broad here and they make it seem like we might share information in ways you don’t want, but this isn’t what we’re doing.
4. We will not share your information with anyone if you deactivate your account. If you’ve already sent a friend a message, they’ll still have that message. However, when you deactivate your account, all of your photos and other content are removed.
5. We apologize for the confusion around these issues. We never intended to claim ownership over people’s content even though that’s what it seems like to many people. This was a mistake and we apologize for the confusion.

Further, Barry Schnitt, a Facebook spokesperson said, “We certainly did not — and did not intend — to create any new right or interest for Facebook in users’ data by issuing the new terms.”  (Italics added for emphasis.) (See: NY Times “Wrap-up”)

Unfortunately, Mr. Schnitt is mostly correct. Facebook already had “perpetual” distribution rights. The old Terms of Use state,

“By posting User Content to any part of the Site, you automatically grant, and you represent and warrant that you have the right to grant, to the Company an irrevocable, perpetual, non-exclusive, transferable, fully paid, worldwide license (with the right to sublicense) to use, copy, publicly perform, publicly display, reformat, translate, excerpt (in whole or in part) and distribute such User Content for any purpose, commercial, advertising, or otherwise, on or in connection with the Site or the promotion thereof, to prepare derivative works of, or incorporate into other works, such User Content, and to grant and authorize sublicenses of the foregoing. You may remove your User Content from the Site at any time. If you choose to remove your User Content, the license granted above will automatically expire, however you acknowledge that the Company may retain archived copies of your User Content. Facebook does not assert any ownership over your User Content; rather, as between us and you, subject to the rights granted to us in these Terms, you retain full ownership of all of your User Content and any intellectual property rights or other proprietary rights associated with your User Content.”  (Terms of Use, revised September 23, 2008)

If you know of a “community” platform that doesn’t lay claim to distribution rights, please tell us.

Afghanistan

Posted on by Liz

(Blog stats are collected so authors know which posts generate  most interest.  According to my stats, readers are more engaged by allegories and concrete helps and resources.  As dessert, it suits me fine;  but sometimes, we have to eat broccoli.  Ergo, Afghanistan.)

A few months ago, I posted a poll which asked respondents to suggest a  US course of action in Afghanistan.  Granted, only 16 people cast votes (it was early days) but for interest’s sake, the most often selected option was to employ our troops  “to improve infrastructure (schools, hospitals, roads, internet, etc.).”

There was one vote to “maintain current troop levels,”  one to “discontinue our military presence in Afghanistan,”  and one to “maintain current troop levels but improve dialogues with affected nations in the region.”  Six voted to “use troops to build or improve infrastructure. (Schools, hospitals, roads, internet, etc.).”  There were several comments which remarked on  Afghanistan’s  “empire-killing” history.  Mine was the only vote for encouraging “the sale of Afghanistan’s poppy crop to pharmaceutical companies.”   (I’ve moderated that opinion and think we should encourage the sale of poppies to a newly-constituted Afghani pharmaceutical industry.)

In recent days,  Pakistan has agreed with the Taliban to a virtual partitioning of the Malakand District  in the Northwest Frontier Province which borders Afghanistan. The Malakand is a political division with 592 square miles which means Sullivan County, NY is roughly 1.5 times larger.  The number of people living in the Malakand  (2004-2005) is nearly half a million more than the 76,000 in Sullivan.  The partition effectively places the District under Sharia Law. (See:  CIA and Census demographics.)

The Chief Minister of the Northwest Frontier Province said permitting the jurisdiction of Sharia Law would fill the hole left by lack of access to Afghanistan’s judicial system.

Accordingly, the argument goes, the de facto partitioning provides a legal framework in which to address land loss,  destruction of crops and the plight of orphans, among other things.

Apparently, if we want women to have the vote, go to school and be able to live with the same rights as their fathers, brothers and husbands, Afghanistan must be able to spread the rule of secular law.

“The United States — using unmanned drones — has carried out several airstrikes inside Pakistan on suspected militant targets, including one on Monday that killed at least 15 people, Pakistani sources said. Such airstrikes, which sometimes result in civilian casualties, have aggravated tensions between the U.S. and Pakistan.”  (CNN)

For nearly ten years in the 1980s, the Soviet Union’s resources were drained by its failed attempt to control Afghanistan.  That failure was encouraged by an international boycott of the USSR and thousands of tons of US armaments and other aid to the mujahidin.  (Wilson Center)

When the Soviets finally exited, the US anticipated the Afghan government would collapse within a year.  Besides being dependent on USSR food aid,  Afghanistan’s gas resources and consequent revenues had dried up.

Decade after decade, it’s been open season on the people of Afghanistan.  In  power struggles between foreign governments, warlords and religious extremists, the Afghani people have been bombed, starved, enslaved, brutalized, imprisoned, beaten and burned.  Villages have been destroyed. Crops have been wiped out.  This is the carnage of war.  It doesn’t count the cost of natural disasters in a nation unable to mount a concerted emergency rescue effort.

After the Soviet withdrawal,  the US government tossed around the idea of providing  farm equipment, fresh water augmentation, schools, hospitals and transportation.  For the most part, those ideas fell by the roadside.

Though only sixteen respondents answered the poll, the consensus was that we must engage the area in diplomacy and help provide the means by which Afghans can achieve independent growth and security. We are currently on track to increase our troop levels from 36,000 to 60,000.  (Reuters)  The majority of poll respondents agreed those troops should be used to help Afghans build schools and roads, grow food and generally, achieve the aims our government considered  twenty years ago.

Over the past several months, the few interviews conducted with US soldiers portray a force with too few weapons, too few personnel and too little support to respond effectively to “actionable intelligence.”

It seems to me that if sixteen citizens understand we’re on the wrong track, that President Obama must.

You can join me in leaving a statement at the White House contact site.

The Class Warfare Trigger

Posted on by Liz

Consolidating wealth in 2% of pockets is not class warfare.

Monopolizing water and fuel resources is not class warfare.

Transferring wealth from the lower 98% to the financial class is not class warfare.

Giving bonuses to the top 2% and stripping 3 million jobs from the lower 98% is not class warfare.

Transferring wealth from the lower 98% to the insurance industry  is not class warfare.

Wealthy people living above  the water line while the lower 98% drown or are displaced in New Orleans is not class warfare.

Investors buying the properties cheap and manipulating zoning laws is not class warfare.

Toxic and/or crumbling schools in rural and urban areas is not class warfare.

Old books and empty libraries in rural and urban schools is not class warfare.

Increased costs of  State colleges and restricted enrollment is not class warfare.

Under-educated  kids enlisting  in the military while others go to college isn’t class warfare.

The elderly losing their pensions while ratings agencies skate free is not class warfare.

CEOs and Congresspeople sporting excellent health insurance while workers are bankrupted for its lack is not class warfare.

Congress fiddling  in endless hearings while workers are foreclosed is not class warfare.

Food shortages are  not class warfare.

Contamination of cheap protein sources (peanut butter) is not class warfare.

Tax codes that reward Buffett and add $12.00 a week to workers’ pockets is not class warfare.

Paying outlandish bonuses to failed CEOs while the UAW is asked to make further concessions is not class warfare.

Putting drug addicts in prison as Halliburton changes its name and gets new government contracts is not class warfare.

Giving taxpayer money to financiers who squeeze taxpayers for increased bank fees is not class warfare.

Secretaries paying taxes at a higher rate than their corporate bosses is not class warfare.

Wealth-based and regional access  to broadband internet is not class warfare.

Class warfare is  when a pattern of unequal access to wealth and power emerges and we have the chutzpah to complain about it.

Stockholm Syndrome & Global Positioning Systems

Posted on by Liz

My son bugged unremittingly until I replaced my old cell phone with one that offered GPS services.  He was sure that happenstance was  the only reason I ever arrived anywhere.

Before my next road trip, the phone was programmed with my location and destination and lay cushioned on the passenger seat like an electronic umbilicus.  Next to it were my daughter’s handwritten directions which I would hide  before pulling into my son’s driveway.  He doesn’t understand the comfort of a paper I can  read myself or shake under his nose the day the signals die.  (See:  American Pie)

I’m the Mom because I’ve been jolted out of smugness more than he has.  He’s wise in many ways but sometimes his imagination fails for lack of experience.  Computers have always been part of his life. He can’t envision a day, for instance,  when traffic jams disrupt orbiting signals.  (NY Times, Colliding Satellites). To tell the truth, neither can I; but I’ve been jolted enough to know that denying the possibility of something  is generally  shortsighted:  “There are more things in heaven and earth, Horatio, [t]han are dreamt of in your philosophy.” *

As I turned left toward the freeway,  the GPS voice was irritatingly indifferent to outcomes – possessed of cadences that would sail through a nuclear strike  so long as batteries and towers escaped the melting.

During the first half hour of the trip, I was pleased to ignore her– to wrest control.  When I passed the second turn in favor of the third, she had no quippy comeback.  The car was silent except for the burring of my own anticipation.  How much stress was built into the system?

Like a Terminator, relentless in its dedication to mission,  the GPS re-configured herself;  aligned herself to new data and surroundings. “Recalculating route,” she said.

I glanced in the rearview mirror and made a Frodo-vow to leave her in my pocket except under the direst of circumstances.

After three hours into a two hour trip, the four lane highway had tapered to a stream trickling between vacant motels and closed gas stations.  I hadn’t seen  a familiar landmark for miles and the winter sun was dimming.  At a crossroads in a small town,  I turned the phone back on, finger poised  to enter my new orientation.  Without missing a beat,  her uninflected tones assured me she was  again, “Recalculating the route.”

In the silence, I felt her omnipresence. She would always know where I was.  I would never be lost again.  “[She]wouldn’t stop, [she] would never leave [me]. [She]…was the only thing that measured up. In an insane world, [she] was the sanest choice.”  (Terminator 2).**

Continue reading “Stockholm Syndrome & Global Positioning Systems” →

Stockholm Syndrome & Global Positioning Systems

Posted on by Liz

My son bugged unremittingly until I replaced my old cell phone with one that offered GPS services.  He was sure that happenstance was  the only reason I ever arrived anywhere.

Before my next road trip, the phone was programmed with my location and destination and lay cushioned on the passenger seat like an electronic umbilicus.  Next to it were my daughter’s handwritten directions which I would hide  before pulling into my son’s driveway.  He doesn’t understand the comfort of a paper I can  read myself or shake under his nose the day the signals die.  (See:  American Pie)

I’m the Mom because I’ve been jolted out of smugness more than he has.  He’s wise in many ways but sometimes his imagination fails for lack of experience.  Computers have always been part of his life. He can’t envision a day, for instance,  when traffic jams disrupt orbiting signals.  (NY Times, Colliding Satellites). To tell the truth, neither can I; but I’ve been jolted enough to know that denying the possibility of something  is generally  shortsighted:  “There are more things in heaven and earth, Horatio, [t]han are dreamt of in your philosophy.” *

As I turned left toward the freeway,  the GPS voice was irritatingly indifferent to outcomes – possessed of cadences that would sail through a nuclear strike  so long as batteries and towers escaped the melting.

During the first half hour of the trip, I was pleased to ignore her– to wrest control.  When I passed the second turn in favor of the third, she had no quippy comeback.  The car was silent except for the burring of my own anticipation.  How much stress was built into the system?

Like a Terminator, relentless in its dedication to mission,  the GPS re-configured herself;  aligned herself to new data and surroundings. “Recalculating route,” she said.

I glanced in the rearview mirror and made a Frodo-vow to leave her in my pocket except under the direst of circumstances.

After three hours into a two hour trip, the four lane highway had tapered to a stream trickling between vacant motels and closed gas stations.  I hadn’t seen  a familiar landmark for miles and the winter sun was dimming.  At a crossroads in a small town,  I turned the phone back on, finger poised  to enter my new orientation.  Without missing a beat,  her uninflected tones assured me she was  again, “Recalculating the route.”

In the silence, I felt her omnipresence. She would always know where I was.  I would never be lost again.  “[She]wouldn’t stop, [she] would never leave [me]. [She]…was the only thing that measured up. In an insane world, [she] was the sanest choice.”  (Terminator 2).**

Continue reading “Stockholm Syndrome & Global Positioning Systems” →

Bank of America : Get Your $78 Refund

Posted on by Liz

(First,  a correction to  Bipartisanship:  The Lowest Common Denominator.  I misleadingly referred to Obama’s restriction on  executive salaries as a restriction on executive compensation.   Though President Obama  has put his weight behind capping certain executive salaries at $500,000,   total executive compensation may be oodles more.  Oodles, billions or trillions?     The difference is…?)

*       *       *

On one hand,  Walt Disney accused the Screen Actors Guild of being a communist front bent on malevolently influencing Hollywood. On the other, he created  Donald Duck who quacked his way into popular culture  in  1934.  When Donald’s  nephews, Huey, Dewey & Louie came to stay for a day and never left, Donald was a de facto single dad with a  romantic companion he never  really married (Daisy).  In later years, he morphed into an adventurer who  dumped the kids on Uncle Scrooge.

Donald’s Hollywood foe, Mickey Mouse, was another Disney creation.  He met his main squeeze,  Minnie the Barmaid,  in a tavern and in their first short together,   Minnie parachuted out of a plane to escape Mickey’s pawings.  It was  the anthropomorphic mouse version of  John Wayne dragging  Maureen O’Hara around by her hair in one cinematic lust fest after another. (Not that I’ve watched The Quiet Man two billion times….)   Mickey & Minnie free float in each other’s lives–sometimes married, sometimes dating–but frequently together for  shared adventures.

In a time when Puritanism  and  Doris Day were slathering our cultural landscape with goo,  Disney understood that if a creature, character or person was cute  enough, he could sell us anything — even lifestyles we found offensive in 1950.

“Cute” and adorably irascible  have  sold us down the drain regularly.   George Bush and Laura Bush are almost as cute as   Ron Paul and he’s  even more adorable than  Barnie Frank, Diane Feinstein and Chris Dodd,  none of  whom hold a candle to the ETrade babies.  (Check out the E-Trade babies which front  for the much-maligned  E-Trade  online trading platform. )

Whether it was weapons of mass destruction or  financier- and congress-based  schemes to rip off credit cardholders,  we’ve  spectated at  our own screwing because so many of the salesman looked or spoke as disarming populists.

Bank of America did virtually no due diligence before it  bought  Merrill Lynch one weekend for $50 billion in stock.  Then, when BOA realized it had grossly underestimated Merrill Lynch’s toxic holdings, it “accepted”  a taxpayer bailout.

In this economy (brought to the point of collapse by financial institutions like Bank of America) what does  BOA do to taxpayer-customers who have BOA accounts and  own BOA’s debt?    They manipulated  “…customers’ account activity in order to trigger more fees for overdrawn accounts, returned checks, and similar infractions. Under the agreement, account holders who incurred overdraft fees from BofA between 2000 and 2007–or from any of the banks it took over during that period–may be entitled to up to a $78 payout. Although it may be a victory for the consumer, financial services advisory firm Bretton Woods says the restitution represents only a sliver of the $368 that the average U.S. household doles out each year for overdraft charges. Generating these and similar fees has become big business for banks and credit unions, which posted $37 billion-plus in such charges last year. As financial institutions try to compensate for losses on loan defaults and stiffer competition during the credit crisis, they are making it easier for customers–even those that carefully monitor their own activity–to trip the fee wire. Practices such as clearing the largest transactions in a single day from largest to smallest and posting deposits last of all makes it difficult for even the most diligent bank customers to avoid charges. In response, consumer advocates are counting on the Federal Reserve to take steps to protect the public from overdraft fees. While the issue failed to earn a place in new credit card rules approved by the agency last month, the central bank has signaled that it will raise the issue again–this time independently–sometime this year.  (See:  Center for Responsible Lending:  Bank of America)

We’re being raped by the people we saved and somehow,  Uncca Chris Dodd and “Populist” Barney Frank can’t get  legislation through Congress that would rescue us because of  push back from the financial lobby.

And then, there’s  Citigroup.

“… Citi began sending the notices at about the same time it was getting a $20 billion, taxpayer-financed government bailout.  No one at Citigroup would talk on camera to CNN about the matter. Instead, the company issued a written statement, which said: “To continue funding in this difficult credit and funding environment, Citi is repricing a group of customers.” Citi told CNN that anyone unhappy with the new [credit card] rates can opt out and continue paying the lower interest, but they must close their account when their card expires. It’s all in the fine print.  (See:  Cnn/Citigroup.)

Here’s Representative Carolyn Maloney’s  proposed legislation “Credit Cardholders’ Bill of Rights” which has been supported by The Center for Responsible Lending.

If you have a BOA  account, apply for your $78.00 and send a copy of the demand to your Congresspeople.

Bipartisanship: Lowest Common Denominator?

Posted on by Liz

According to CNBC,  the  US Senate has pared Obama’s Stimulus Package  from $937 to  $780 billion.  A vote is expected Sunday because Congress needs to start its  recess ASAP. 

(Remember the expressed outrage when Iraq’s Congress took a vacation while its nation faced insurrection and bankruptcy?  Remember our Congress’  indignation that Iraq’s lawmakers had the chutzpah  to take a vacation while American taxpayers footed the bill?  Remember the purpled faces and bursting veins of our shining palladins?) 

Most economists  are pleading  for a Stimulus Package nearer  $1 trillion.   They’ve  tossed an  I Ching of  formulae  based on percentages of Gross National Product and investment/return ratios and are shrieking,  “The appropriation is  going backward!  The train is out of control!  The horses are stampeding!”   Not a catastrophic metaphor has been left in the box.  And yet,  Nero fiddles as Rome burns.

Additionally,  “Massachusetts Democrat John Kerry said the compromise price tag would be made up of 42 percent tax cuts with 58 percent in new spending.”  (CNBC)  

Most economists agree that tax cuts are anathema in times like these–like  a passenger trying to stop a run-away rollercoaster by dragging her feet on the track:  it’s a waste of time, it won’t work and the thing in need of  saving will get her legs broken.

Obama’s practice these past two years has been to watch his opponents crash of their own gravity.  He doesn’t participate substantially in that downfall.  (It’s a basic Gandhi/King principle; a kind of  Judo politic.) 

These past weeks,  President Obama has  hosted a bipartisan Super Bowl party and  two cocktail “parties.”  He’s  bearded the Conservative lion in its den down at Congress.   He offered a stimulus bill with enough tax cuts to raise brows in the pundit community and yet,  Senate Republicans and Conservative Democrats reduced the package  by another $150 billion.

Zero Republicans voted for the first compromise package.

Two or three are expected to vote for the Senate bill.

Has Obama sold our economic future down the tubes for the sake of a few bipartisan pieces of silver?  

Or, has he allowed knee-jerk naysayers with bankrupt economic policies to  dramatically and publicly shoot themselves in  both feet?

Obama’s slated to offer his Recovery Plan this coming Monday.   He wants the Senate to pass the Stimulus Package before that. 

If the Recovery Plan covers all the bases Candidate-Obama trumpeted the past two years, it will include more funds for health care, infrastructure, “greening”  and the consequent job production and training.  By the time the Recovery Plan is unveiled,  the “loyal  Conservative opposition”  will have been marginalized on  their own petards. 

If I sound like a True Believer, eschewing rebellion in the face of  Obama’s vows that, “Tomorrow, Tomorrow”  my reward will come tomorrow,  I apologize and propose this:

If  the Recovery Plan is more of the same  “bipartisan,”  lowest-common-denominator-political-toadying as offered by the Stimulus Package,  then every worker,  wannabe-worker, retiree, wannabe-retiree, student  and wannabe-student needs to march on Washington within the month.  We need to take our tents,  backpacks and firewood for cooking.  

And we must not accede to being penned like cattle behind officially-approved barriers.

Bipartisanship: Lowest Common Denominator?

Posted on by Liz

According to CNBC,  the  US Senate has pared Obama’s Stimulus Package  from $937 to  $780 billion.  A vote is expected Sunday because Congress needs to start its  recess ASAP. 

(Remember the expressed outrage when Iraq’s Congress took a vacation while its nation faced insurrection and bankruptcy?  Remember our Congress’  indignation that Iraq’s lawmakers had the chutzpah  to take a vacation while American taxpayers footed the bill?  Remember the purpled faces and bursting veins of our shining palladins?) 

Most economists  are pleading  for a Stimulus Package nearer  $1 trillion.   They’ve  tossed an  I Ching of  formulae  based on percentages of Gross National Product and investment/return ratios and are shrieking,  “The appropriation is  going backward!  The train is out of control!  The horses are stampeding!”   Not a catastrophic metaphor has been left in the box.  And yet,  Nero fiddles as Rome burns.

Additionally,  “Massachusetts Democrat John Kerry said the compromise price tag would be made up of 42 percent tax cuts with 58 percent in new spending.”  (CNBC)  

Most economists agree that tax cuts are anathema in times like these–like  a passenger trying to stop a run-away rollercoaster by dragging her feet on the track:  it’s a waste of time, it won’t work and the thing in need of  saving will get her legs broken.

Obama’s practice these past two years has been to watch his opponents crash of their own gravity.  He doesn’t participate substantially in that downfall.  (It’s a basic Gandhi/King principle; a kind of  Judo politic.) 

These past weeks,  President Obama has  hosted a bipartisan Super Bowl party and  two cocktail “parties.”  He’s  bearded the Conservative lion in its den down at Congress.   He offered a stimulus bill with enough tax cuts to raise brows in the pundit community and yet,  Senate Republicans and Conservative Democrats reduced the package  by another $150 billion.

Zero Republicans voted for the first compromise package.

Two or three are expected to vote for the Senate bill.

Has Obama sold our economic future down the tubes for the sake of a few bipartisan pieces of silver?  

Or, has he allowed knee-jerk naysayers with bankrupt economic policies to  dramatically and publicly shoot themselves in  both feet?

Obama’s slated to offer his Recovery Plan this coming Monday.   He wants the Senate to pass the Stimulus Package before that. 

If the Recovery Plan covers all the bases Candidate-Obama trumpeted the past two years, it will include more funds for health care, infrastructure, “greening”  and the consequent job production and training.  By the time the Recovery Plan is unveiled,  the “loyal  Conservative opposition”  will have been marginalized on  their own petards. 

If I sound like a True Believer, eschewing rebellion in the face of  Obama’s vows that, “Tomorrow, Tomorrow”  my reward will come tomorrow,  I apologize and propose this:

If  the Recovery Plan is more of the same  “bipartisan,”  lowest-common-denominator-political-toadying as offered by the Stimulus Package,  then every worker,  wannabe-worker, retiree, wannabe-retiree, student  and wannabe-student needs to march on Washington within the month.  We need to take our tents,  backpacks and firewood for cooking.  

And we must not accede to being penned like cattle behind officially-approved barriers.

The Week That Was: Words & Brainstorms

Posted on by Liz

It’s been a  flurry all week.  Here’s a collection of pieces:

US Army and Marines report a sharp escalation in soldier and veteran suicides.  (LA Times)  Caregivers on the front lines cited, among other issues, more and longer deployments, family stress, hopelessness, drugs, alcohol and extreme psychological fatigue.

In the Senate Banking Committee Hearing (Chaired by Sen. Chris Dodd),  Paul Volcker, former Federal Reserve Chairman and Obama advisor offered,  “…other nations regulate the risk of  functions  rather than of entities  or particular business models.”  

 (Author note:  our present system regulates banks, for instance, but  the function of mortgage-backed securities slipped through the jurisdictional cracks of  twenty understaffed  regulatory agencies.  (See CSPAN videos.)

In the same hearing, Gene  Dodaro, Acting Comptroller General of the U.S. Government Accountability Office and Elizabeth Warren, Chair of  the Congressional Oversight Panel for the TARP  described faultlines in our financial structure and offered comments:  (1)  it’s inefficient, ineffective and inflexible; (2) it permits inadequate disclosures by credit institutions; (3)  the “financial illiteracy” of the populace  and inadequate disclosures by institutions combined to create predatory loans with incomprehensible terms; (4)  Federal and State jurisdictional issues created holes in oversight/regulation;  (5) institutions that originated loans passed the risk to other institutions without keeping “skin in the game”;  (6) we need  new ways to value  the debt because we don’t know who’s holding it or what it’s  worth;  (6)  current compensation models  encourage bad loans because there’s little or no  risk to the  originating broker. 

In an umbrella statement,  Dodaro described the current  financial model as pitting consumer protection against economic growth and urged Congress  to recognize that growth is impossible without the  trust and health of the consumer.

Senator Mark Warren referenced financial illiteracy  and  the  lack of regulation that’s allowed lenders and insurance companies to prey on our soldiers and their  families.

Witnesses in the hearing  concurred that:  (1)  we don’t know where the bailout funds are;  (2)  institutions who received funds feel no obligation  to reveal what they did with them; and regardless,  (3)  the bailout has not  significantly improved the flow of investments or loans; and (4) small business failures  and foreclosures are escalating.

Obama, stumping for the Stimulus Plan, described it as a strategy, not a piecemeal, temporary fix.

Rep. Marcy Kaptur (D-OH) told homeowners to stay in their homes when they’re foreclosed.  She told Amy Goodman (Democracy Now)  “…there’s a number people can call:  (888-995-HOME)  to get the proper legal representation so they can actually have the scales of justice be balanced rather than, now, all the power to Wall Street and none of the justice to Main Street.” 

(Author note:   When tenants were thrown out of their homes in the 1920s and ’30s,  their neighbors and activists overcame dogs, sheriff ‘s deputies and head-cracking batons to haul each other’s belongings back inside.)

Obama:  Companies  that receive TARP funds will limit executive compensation to $500,000.  This has caused corporations to worry they won’t be able to “attract the best talent.”   (Rewarding incompetence seems to have worked so well for all of us.)  

Aren’t our Graduate Schools  loaded with financial and administrative wizards?  Let them take take the mound and relegate  the Geithners,  Summers, Rubins and financiers to advisory positions in the dugout.  One idea is that executive officers be rewarded only after their policies result in  sustained profit growth over a number of years.  (No more $18 billion bonuses for collapsing a world economy in a single year.)

National Prayer Breakfast  and broadening of the old “faith-based” service model. My agnostic self is staying out of this one but my community organizer is shouting “hallelujah!”   (Perhaps the idea would be less offensive if we called it a “National Meditational Breakfast.)   “Community Service”  is, apparently,  fertile ground for another “Moral Majority” showdown.  It reminds me of  the efforts peace activists made  “to take back the flag”  after Bush invaded Iraq.  Obama’s model incorporates secular groups and recognizes a place for both secular and religious organizations.  My objection would be  to  religious bias dictating  what, how and to whom our civil services are provided.  (See:  First Amendment on separation of Church & State:  “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof…”)  Certainly, stringent guidelines must be enforced if  community service is to remain free of  religious dogma.

According to Bloomberg News  on February 4, 2009,  “Bank of America’s CEO (Kenneth Lewis) told employees that his management team and strategy have the board’s support and January results were ‘encouraging’ as turmoil in the credit markets eased.”  

The  very next day, “Bank of America’s  (BAC) shares  fell as low as $3.77 before finishing up 14 cents at $4.84.  The bank’s shares had fallen for five days prior to Thursday.”  (In the period from  January 1, 2009 to February 5, 2009 — 36 days — BAC has fallen from $14.08 to $4.56.)  No kidding,  some pundits are wondering whether Lewis is the “right guy for the job.”

Bank of America still won’t let people sully their great glass windows with community announcements.

Today,  “January’s sharp drop in employment brings job losses to 3.6 million since the start of the recession in December 2007 and…about half the decline occurred in the last three months.  January’s losses followed upwardly revised cuts of 577,000 in December and 597,000 in November.”  (CNBC) 

In an Orwellian way,  these unemployment numbers are good news because coincidentally, average hourly wages have risen from 0.3-0.4%  over last year. I guess that’s what happens when mass layoffs and retail closings  eliminate low wage earners from the statistical pool.

And finally, 14 year old actess  Dakota Fanning  strode  pencil-thin  onto the stage of late night television in a pair of  spiked heels.

The Week That Was: Words & Brainstorms

Posted on by Liz

It’s been a  flurry all week.  Here’s a collection of pieces:

US Army and Marines report a sharp escalation in soldier and veteran suicides.  (LA Times)  Caregivers on the front lines cited, among other issues, more and longer deployments, family stress, hopelessness, drugs, alcohol and extreme psychological fatigue.

In the Senate Banking Committee Hearing (Chaired by Sen. Chris Dodd),  Paul Volcker, former Federal Reserve Chairman and Obama advisor offered,  “…other nations regulate the risk of  functions  rather than of entities  or particular business models.”  

 (Author note:  our present system regulates banks, for instance, but  the function of mortgage-backed securities slipped through the jurisdictional cracks of  twenty understaffed  regulatory agencies.  (See CSPAN videos.)

In the same hearing, Gene  Dodaro, Acting Comptroller General of the U.S. Government Accountability Office and Elizabeth Warren, Chair of  the Congressional Oversight Panel for the TARP  described faultlines in our financial structure and offered comments:  (1)  it’s inefficient, ineffective and inflexible; (2) it permits inadequate disclosures by credit institutions; (3)  the “financial illiteracy” of the populace  and inadequate disclosures by institutions combined to create predatory loans with incomprehensible terms; (4)  Federal and State jurisdictional issues created holes in oversight/regulation;  (5) institutions that originated loans passed the risk to other institutions without keeping “skin in the game”;  (6) we need  new ways to value  the debt because we don’t know who’s holding it or what it’s  worth;  (6)  current compensation models  encourage bad loans because there’s little or no  risk to the  originating broker. 

In an umbrella statement,  Dodaro described the current  financial model as pitting consumer protection against economic growth and urged Congress  to recognize that growth is impossible without the  trust and health of the consumer.

Senator Mark Warren referenced financial illiteracy  and  the  lack of regulation that’s allowed lenders and insurance companies to prey on our soldiers and their  families.

Witnesses in the hearing  concurred that:  (1)  we don’t know where the bailout funds are;  (2)  institutions who received funds feel no obligation  to reveal what they did with them; and regardless,  (3)  the bailout has not  significantly improved the flow of investments or loans; and (4) small business failures  and foreclosures are escalating.

Obama, stumping for the Stimulus Plan, described it as a strategy, not a piecemeal, temporary fix.

Rep. Marcy Kaptur (D-OH) told homeowners to stay in their homes when they’re foreclosed.  She told Amy Goodman (Democracy Now)  “…there’s a number people can call:  (888-995-HOME)  to get the proper legal representation so they can actually have the scales of justice be balanced rather than, now, all the power to Wall Street and none of the justice to Main Street.” 

(Author note:   When tenants were thrown out of their homes in the 1920s and ’30s,  their neighbors and activists overcame dogs, sheriff ‘s deputies and head-cracking batons to haul each other’s belongings back inside.)

Obama:  Companies  that receive TARP funds will limit executive compensation to $500,000.  This has caused corporations to worry they won’t be able to “attract the best talent.”   (Rewarding incompetence seems to have worked so well for all of us.)  

Aren’t our Graduate Schools  loaded with financial and administrative wizards?  Let them take take the mound and relegate  the Geithners,  Summers, Rubins and financiers to advisory positions in the dugout.  One idea is that executive officers be rewarded only after their policies result in  sustained profit growth over a number of years.  (No more $18 billion bonuses for collapsing a world economy in a single year.)

National Prayer Breakfast  and broadening of the old “faith-based” service model. My agnostic self is staying out of this one but my community organizer is shouting “hallelujah!”   (Perhaps the idea would be less offensive if we called it a “National Meditational Breakfast.)   “Community Service”  is, apparently,  fertile ground for another “Moral Majority” showdown.  It reminds me of  the efforts peace activists made  “to take back the flag”  after Bush invaded Iraq.  Obama’s model incorporates secular groups and recognizes a place for both secular and religious organizations.  My objection would be  to  religious bias dictating  what, how and to whom our civil services are provided.  (See:  First Amendment on separation of Church & State:  “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof…”)  Certainly, stringent guidelines must be enforced if  community service is to remain free of  religious dogma.

According to Bloomberg News  on February 4, 2009,  “Bank of America’s CEO (Kenneth Lewis) told employees that his management team and strategy have the board’s support and January results were ‘encouraging’ as turmoil in the credit markets eased.”  

The  very next day, “Bank of America’s  (BAC) shares  fell as low as $3.77 before finishing up 14 cents at $4.84.  The bank’s shares had fallen for five days prior to Thursday.”  (In the period from  January 1, 2009 to February 5, 2009 — 36 days — BAC has fallen from $14.08 to $4.56.)  No kidding,  some pundits are wondering whether Lewis is the “right guy for the job.”

Bank of America still won’t let people sully their great glass windows with community announcements.

Today,  “January’s sharp drop in employment brings job losses to 3.6 million since the start of the recession in December 2007 and…about half the decline occurred in the last three months.  January’s losses followed upwardly revised cuts of 577,000 in December and 597,000 in November.”  (CNBC) 

In an Orwellian way,  these unemployment numbers are good news because coincidentally, average hourly wages have risen from 0.3-0.4%  over last year. I guess that’s what happens when mass layoffs and retail closings  eliminate low wage earners from the statistical pool.

And finally, 14 year old actess  Dakota Fanning  strode  pencil-thin  onto the stage of late night television in a pair of  spiked heels.

Economy: Fixing a Broken Heart

Posted on by Liz

The magical art of economics makes sense to me  only in real-life analogies.  I know some of the jargon and find it nearly as fascinating as the art itself.  High practitioners possess a comprehensive, pragmatic and effective understanding of (1)  where we are in history;  (2)  what the future holds;  (3) what we’ll need to bridge the gap;  and (4)  what  the probability is  that particular events will effect  our forward outcomes.  The last one calculates a dizzying array of  data and impressions from climate change and famine to  sonograms and pancreatic cancer.  Economics is the Buddhism of  the Magical Arts.  In fact, this blog could have been entitled, “Breathing is Economics.”

If a patient’s heart stops,  it needs a big  jolt to act as if it’s  alive. That initial jolt is a pretense:  whether we’re re-starting a heart, a battery or an economy,  the initial stimulus is a  second chance, not a fix.  Without fuel  to keep the engine charged,  another shut down is  inevitable.  (If a mixed metaphor works, then what do we care? It’s the gestalt we’re getting at here.)

The current inside-the-bubble  discussion is about whether  Obama’s Stimulus  creates enough jobs  OR  if it’s a wish list of  forward-looking investments.  (This is the basis of the stock market which predicts which  products will get us from here to there.)  The real question should be:  does it create or save enough jobs to give us confidence in the future  AND  does it anticipate building the educational and technological bridges  that will support a recovery?  In other words and to reference an Obama quote,  “Can we walk and chew gum at the same time?”

The economic stimulus has to to be big enough to  convince us that an innovative, smart economy is  in the offing.  Of necessity,  an  economic growth package has to create  sustainable manufacturing and service sectors.  So, we must invest in education and the  body politic (arts, humanities, science and technology).  We must stimulate  new economies and continuing education that  green the planet,  generate  well-health care and build local communities.

Both the stimulus and growth plans must prove our commitment to ethics and  to a workforce that  values and can afford  to buy what it produces.  Our decision making and its process must  prove we’re commited to a republic not an oligarchy.

On my birthday (January 27th) Jon Stewart suggested a stimulus plan that would eradicate our consumer debt (including mortgages) and inject  lending institutions with capital.  The  simple beauty of his plan lacks details and leaves much  to  debate, but it pinpoints the vital starting point:  worker-consumers.  As long as we’re afraid that  debt and job losses are going to drag us  over a cliff, we’ll buy only  necessities.  Demand for products will continue to slide and it’s ridiculous to invest  in companies whose products won’t be bought.   Combined with very little credit to grease the gears,  the world economy is grinding to a halt.    While Jim Cramer waxed  poetic about recession-resistant stocks like Johnson & Johnson and Colgate Palmolive, we were buying generics at the dollar stores. Our real lives are moving  faster toward pragmatism than the stock market can anticipate or pundits in a bubble can predict. Luxury and impulse buying are gone.   We’re cleaning  our own houses, cutting our own hair, plowing our own drives, mowing our own lawns, making our own yogurt and bread,  fixing our own plumbing and  growing  our own veggies.   (See  the  Foxfire Books. A Foxfire Christmas is particularly cool, I think.)  We’ve wakened from our consumptive coma  and we’re haunting  second hand shops and  buying toilet paper for  Just-A-Buck.  (If you’re new to this, find an old hippy who still looks like an old hippy and find out where s/he got her/his clothes, food and that nifty snowblower.  Also,  check out  Freecycle.  It’s an astonishing source of  free stuff.)

Sorry.  Back to Jon Stewart’s economic stimulus.

He’s  proposed  a new place to begin and called the scheme  “trickle up.”   Months ago, I suggested a direct infusion of funds to   local employers in order to stem job losses.  Both that idea and Stewart’s  shore up  the foundation of the  pyramid and frankly, as long as we jolt the core and build from the foundation, I don’t much care how we do it.

There are a blizzard of details to sort through of which these are just a few:

Regulators and  people facing foreclosure may not know which caballic entity holds their mortgage debt today,  but  consumers know which bank and loan officer  approved it. Do we give the money to the originating bank who may have issued a lousy loan?  Remember, the patient’s heading for complete cardiac arrest.  We don’t  have time to worry about which arteries messed us up; we need to jump start the  heart.  Some greedy consumers and banks will be rewarded.   It’s an unfortunate consequence that common sense suggests we must swallow.

Would every consumer get $15,000 to pay down or eliminate non-mortgage debt?   Would we modify corporate debt?  Or,  would we  limit debt cancellation to  locally-owned and/or  -operated businesses  with healthy, symbiotic relationships to their workers and communities?  (Nirvana, that and probably  fraught with legal challenges.  Not to mention how few locally-owned and/or operated businesses are surviving the early carnage.)

Which mortgage debt do we wipe out?  Do we subsidize all properties that have lost  value since purchase  or only property holders  who’ve lost or are in danger of losing the property?  Do we include only the primary home or do  we help the  retiree who bought a vacation home as a retirement investment?  Do we consider residential and commercial mortgages?  Do we have time to look at the community-at-large?  Can we afford not to?

We don’t have time to re-value each mortgage and  credit card so we might  have to pick a pay-back  percentage  which all parties  accept as whole.  If  we  owe the credit card company  $10,000, the company has to agree that  $1,000 (10 cents on the dollar) makes them whole.  Then,  Linens & Things and  Circuit City (the bankrupt companies where we bought our towels and computers) have  to accept $5 for a $50 bed sheet and  $100 for the $1,000 computer  they sold.  (I’m not saying it’s a bad deal, but  part of the equation is that when franchise retailers go out of business,  we lose the  under-compensated jobs many of us have been “educated” to fill.)

It’s gnarly; but so is the idea of a trillion dollars going directly to banks in hopes they’ll get around to re-financing  our debt.  They won’t.  Not just because they’re greedily waiting to scoop up the weaklings, but because they’d  be crazy to lend money in a sliding economy without substantial government investment in the future.

Increasingly violent hurricanes, floods, crop destruction,  water pollution and  water wars are events that threaten our basic food supply  and our economic forecast.  They  demand  resources for fixing rather than prevention.

Our transportation and electric grids are so  unreliable  that year-round, millions of people are left for weeks without heat/air conditioning, electric and water  in the wake of  storms.  When our transportation arteries aren’t flooded, they’re rendered impassible by ice.  They’re pocked with axle-busting potholes and our bridges are crumbling.  “Bird strikes” pose a known and unpredictable threat to our air transport, for cryin’ out loud.

We’ve got plenty of work to do–plenty of valuable jobs to fill.  If  an economic plan includes a large enough jolt and forward-thinking investments,  then it stands a chance of  succeeding.  (See:  House Bill and Senate Bill at Thomas.gov.)

A small note on “Sin Taxes.” Many of  us can’t afford the pleasures of  vacations, monthly trips to the movies or fresh fruits & veggies,  so we cling to our cheap substitutes:  fast-fat-sweet-salty-food,  cigarettes,  dope and  beer).  It isn’t a pretty picture (especially for the children) but if we’re going to tax sin,  then we need to think of it in terms of  a population that can’t afford  regular trips to a therapist.

Economy: Fixing a Broken Heart

Posted on by Liz

The magical art of economics makes sense to me  only in real-life analogies.  I know some of the jargon and find it nearly as fascinating as the art itself.  High practitioners possess a comprehensive, pragmatic and effective understanding of (1)  where we are in history;  (2)  what the future holds;  (3) what we’ll need to bridge the gap;  and (4)  what  the probability is  that particular events will effect  our forward outcomes.  The last one calculates a dizzying array of  data and impressions from climate change and famine to  sonograms and pancreatic cancer.  Economics is the Buddhism of  the Magical Arts.  In fact, this blog could have been entitled, “Breathing is Economics.”

If a patient’s heart stops,  it needs a big  jolt to act as if it’s  alive. That initial jolt is a pretense:  whether we’re re-starting a heart, a battery or an economy,  the initial stimulus is a  second chance, not a fix.  Without fuel  to keep the engine charged,  another shut down is  inevitable.  (If a mixed metaphor works, then what do we care? It’s the gestalt we’re getting at here.)

The current inside-the-bubble  discussion is about whether  Obama’s Stimulus  creates enough jobs  OR  if it’s a wish list of  forward-looking investments.  (This is the basis of the stock market which predicts which  products will get us from here to there.)  The real question should be:  does it create or save enough jobs to give us confidence in the future  AND  does it anticipate building the educational and technological bridges  that will support a recovery?  In other words and to reference an Obama quote,  “Can we walk and chew gum at the same time?”

The economic stimulus has to to be big enough to  convince us that an innovative, smart economy is  in the offing.  Of necessity,  an  economic growth package has to create  sustainable manufacturing and service sectors.  So, we must invest in education and the  body politic (arts, humanities, science and technology).  We must stimulate  new economies and continuing education that  green the planet,  generate  well-health care and build local communities.

Both the stimulus and growth plans must prove our commitment to ethics and  to a workforce that  values and can afford  to buy what it produces.  Our decision making and its process must  prove we’re commited to a republic not an oligarchy.

On my birthday (January 27th) Jon Stewart suggested a stimulus plan that would eradicate our consumer debt (including mortgages) and inject  lending institutions with capital.  The  simple beauty of his plan lacks details and leaves much  to  debate, but it pinpoints the vital starting point:  worker-consumers.  As long as we’re afraid that  debt and job losses are going to drag us  over a cliff, we’ll buy only  necessities.  Demand for products will continue to slide and it’s ridiculous to invest  in companies whose products won’t be bought.   Combined with very little credit to grease the gears,  the world economy is grinding to a halt.    While Jim Cramer waxed  poetic about recession-resistant stocks like Johnson & Johnson and Colgate Palmolive, we were buying generics at the dollar stores. Our real lives are moving  faster toward pragmatism than the stock market can anticipate or pundits in a bubble can predict. Luxury and impulse buying are gone.   We’re cleaning  our own houses, cutting our own hair, plowing our own drives, mowing our own lawns, making our own yogurt and bread,  fixing our own plumbing and  growing  our own veggies.   (See  the  Foxfire Books. A Foxfire Christmas is particularly cool, I think.)  We’ve wakened from our consumptive coma  and we’re haunting  second hand shops and  buying toilet paper for  Just-A-Buck.  (If you’re new to this, find an old hippy who still looks like an old hippy and find out where s/he got her/his clothes, food and that nifty snowblower.  Also,  check out  Freecycle.  It’s an astonishing source of  free stuff.)

Sorry.  Back to Jon Stewart’s economic stimulus.

He’s  proposed  a new place to begin and called the scheme  “trickle up.”   Months ago, I suggested a direct infusion of funds to   local employers in order to stem job losses.  Both that idea and Stewart’s  shore up  the foundation of the  pyramid and frankly, as long as we jolt the core and build from the foundation, I don’t much care how we do it.

There are a blizzard of details to sort through of which these are just a few:

Regulators and  people facing foreclosure may not know which caballic entity holds their mortgage debt today,  but  consumers know which bank and loan officer  approved it. Do we give the money to the originating bank who may have issued a lousy loan?  Remember, the patient’s heading for complete cardiac arrest.  We don’t  have time to worry about which arteries messed us up; we need to jump start the  heart.  Some greedy consumers and banks will be rewarded.   It’s an unfortunate consequence that common sense suggests we must swallow.

Would every consumer get $15,000 to pay down or eliminate non-mortgage debt?   Would we modify corporate debt?  Or,  would we  limit debt cancellation to  locally-owned and/or  -operated businesses  with healthy, symbiotic relationships to their workers and communities?  (Nirvana, that and probably  fraught with legal challenges.  Not to mention how few locally-owned and/or operated businesses are surviving the early carnage.)

Which mortgage debt do we wipe out?  Do we subsidize all properties that have lost  value since purchase  or only property holders  who’ve lost or are in danger of losing the property?  Do we include only the primary home or do  we help the  retiree who bought a vacation home as a retirement investment?  Do we consider residential and commercial mortgages?  Do we have time to look at the community-at-large?  Can we afford not to?

We don’t have time to re-value each mortgage and  credit card so we might  have to pick a pay-back  percentage  which all parties  accept as whole.  If  we  owe the credit card company  $10,000, the company has to agree that  $1,000 (10 cents on the dollar) makes them whole.  Then,  Linens & Things and  Circuit City (the bankrupt companies where we bought our towels and computers) have  to accept $5 for a $50 bed sheet and  $100 for the $1,000 computer  they sold.  (I’m not saying it’s a bad deal, but  part of the equation is that when franchise retailers go out of business,  we lose the  under-compensated jobs many of us have been “educated” to fill.)

It’s gnarly; but so is the idea of a trillion dollars going directly to banks in hopes they’ll get around to re-financing  our debt.  They won’t.  Not just because they’re greedily waiting to scoop up the weaklings, but because they’d  be crazy to lend money in a sliding economy without substantial government investment in the future.

Increasingly violent hurricanes, floods, crop destruction,  water pollution and  water wars are events that threaten our basic food supply  and our economic forecast.  They  demand  resources for fixing rather than prevention.

Our transportation and electric grids are so  unreliable  that year-round, millions of people are left for weeks without heat/air conditioning, electric and water  in the wake of  storms.  When our transportation arteries aren’t flooded, they’re rendered impassible by ice.  They’re pocked with axle-busting potholes and our bridges are crumbling.  “Bird strikes” pose a known and unpredictable threat to our air transport, for cryin’ out loud.

We’ve got plenty of work to do–plenty of valuable jobs to fill.  If  an economic plan includes a large enough jolt and forward-thinking investments,  then it stands a chance of  succeeding.  (See:  House Bill and Senate Bill at Thomas.gov.)

A small note on “Sin Taxes.” Many of  us can’t afford the pleasures of  vacations, monthly trips to the movies or fresh fruits & veggies,  so we cling to our cheap substitutes:  fast-fat-sweet-salty-food,  cigarettes,  dope and  beer).  It isn’t a pretty picture (especially for the children) but if we’re going to tax sin,  then we need to think of it in terms of  a population that can’t afford  regular trips to a therapist.