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Everyone else must fail

Sunday, June 10, 2012

 

Today’s Boston Globe reports that young people are not buying homes, and that their failure to do so will have negative impacts on the economy. The article comes complete with the required profile of an atypical exemplar of the affected class of people, a young woman who, at least implicitly, actually has the ability to purchase a home if she wanted to, but is inexplicably put off by the fact that other people who can’t afford homes are being foreclosed. But the article eventually gets to the root causes.

High unemployment, crushing student debt, and tight credit conditions are keeping many young adults and families from becoming homeowners, analysts and real estate professionals said. At the same time, the turmoil that has followed since prices peaked in 2005 and the housing market collapsed is changing this younger generation’s view of housing, long thought of as a safe, sure investment and prerequisite to the American dream.

(via Boston Globe)

90% of the truth lies in the first sentence of the quoted paragraph. People got foreclosed during the Depression, but I’d bet quite a bit that people still wanted to own homes back then.

What is most interesting to me about this story is the underlying subtext that these developments are the result of some force of nature, rather than deliberate policy. Had we, in 1980, deliberately set out to screw succeeding generations, we need not have done anything differently than we have done. In fact, it was deliberate.

I grew up in what would have to be described as a low income household. I went to an inner city high school. I attended an elite college and a state law school. Total college costs, tuition plus room and board, were a bit over $4,000.00 per annum. UConn Law School, when I attended, cost, I believe, $300.00 a semester, though it may have been double that. I graduated from law school with a total of $2,000.00 in debt. Through scholarships and work study, college cost almost nothing. My story, once a commonplace, cannot happen today.

The college I attended now costs upwards of $50,000.00 a year. Inflation alone cannot explain that. State universities, which back then were far cheaper than the relatively high ticket price at my college, are no longer a cheaper option. Back in my day, California colleges cost, if memory serves, $0.00 per year for in-state students. It was the best deal in the nation, but most other state universities and colleges were cheap. Proposition 13 took care of California, but in every state the anti-tax ideology has led us to abandon the common sense principle that since an educated citizenry benefits us all, all of us should bear the cost. Recently we learned that UConn will hire more professors, and pay for them with yet another tuition increase. It no longer even occurs to us that perhaps we should all be sharing the cost.

It’s not just increased college costs, of course. Spending on education has taken a hit at all levels, and the folks responsible for those cuts then complain that our young people are not educated for the millions of mythical unfilled jobs for which they allegedly lack skills. Our tax policies have shoved money toward the .01%, our corporations have shipped jobs overseas, and our political parties have vied to see which can gut the power of organized labor the most. We have constructed a society in which suitable jobs for those indebted students do not exist. When not the result of direct government action, the private actions that work to destroy us have been aided and abetted by both parties. See, e.g., the repeal of Glass-Steagall. The surprises come when we actually do something to benefit the people, such as the recent legislation that ended the bank’s student loan racket. The middle class is disappearing, and with it the consumer spending on which the economy depends in order to grow.

None of this was inevitable. The present plight of the young is a result of deliberate policy choices on the state and local level. Young people these days are entering a world of uncertainty that is unprecedented. No job is safe, no future secure. Is it any surprise that they put off starting families and buying homes? Once again, I am reminded of one of the finest lines of dialogue I can recall from any movie I’ve seen, the otherwise fairly forgettable Superman III, in which Robert Vaughn’s capitalist villain sums up his motivation, and that at work behind the Koch Brothers, et. al., who are screwing all of us, but particularly the young: “It is not enough that [we] succeed, everyone else must fail”

 

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Friday Night Music: The Krugman Blues

Friday, June 8, 2012

If any of my readers happen to read Paul Krugman’s blog, they are probably aware that there is an infinitesimally small, yet not non-existent, chance that he stole his Friday Night Music feature from me. I have managed to contain my outrage. Our tastes do not appear to coincide that much in music, though both of us are lamentably addicted to reason, which can make life difficult sometimes.

Anyway, I did not get this from Krugman’s Friday Night Music feature, though I did steal it from his blog. If he can possibly steal from me, then I am fully justified in stealing from him. Now, if only someone would write the CTBlue Blues.

Loudon Wainwright III:

Here’s Loudon singing his one big hit mildly successful song, at Occupy. Here’s hoping there’s another dead skunk come this November.

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Solidarity, Brother!

Friday, June 8, 2012

 

Private sector Unions in New York join with business interests and DINO Andrew Cuomo to destroy public sector unions.

What do they think those folks will do once they succeed with state workers? Maybe they ought to listen a little closer to Scott Walker.

 

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It’s good to be a plutocrat

Wednesday, June 6, 2012

Yet another example of the Obama Justice Department doing just what one would have expected from the Bush Justice Department:

The Obama administration is set to urge a federal appeals court to reinstate a $1.5 million music filing-sharing verdict a jury levied against a Minnesota woman for sharing two dozen songs on Kazaa.

At issue is a Minnesota federal judge’s decision last year lowering the verdict to $54,000, ruling that the jury’s award “for stealing 24 songs for personal use is appalling”.

The case tests the constitutionality of the Copyright Act, which allows penalties of as much as $150,000 per infringement. It also asks whether federal judges have the power to reduce copyright damage awards rendered by juries.

(via Wired)

Generally speaking, the Justice Department has the obligation to defend the constitutionality of a statute, but that doesn’t mean it has to take the position it’s taking in this case. All of a piece with the generally dismal performance of the Obama Justice Department.

This is what comes when people get to make their own laws; or, more properly, when corporations get to make their own laws. When the rest of us are damaged, we have to prove the amount by which we have been damaged. Corporations get to pass laws that set damage amounts wildly out of proportion to any actual harm. There can be no doubt that the Supreme Court that has so assiduously sought to limit the amount of punitive damages regular people can get from corporations will have no trouble defending the rights of corporations to awards totally out of proportion to the damages they have suffered. Funny too, that the Congresses that have passed laws like this are stuffed chockablock with legislators that advocate “tort reform”, which translates into limitations of damages awards against corporate America.

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Honor among thieves

Monday, June 4, 2012

The inestimable Gretchen Morgenstern unearths yet another example of corporate crime, soon to disappear, unpunished, into the infinite number of memory holes at the Justice Department and the SEC:

Days before Bank of America shareholders approved the bank’s $50 billion purchase of Merrill Lynch in December 2008, top bank executives were advised that losses at the investment firm would most likely hammer the combined companies’ earnings in the years to come. But shareholders were not told about the looming losses, which would prompt a second taxpayer bailout of $20 billion, leaving them instead to rely on rosier projections from the bank that the deal would make money relatively soon after it was completed.

What Bank of America’s top executives, including its chief executive then, Kenneth D. Lewis, knew about Merrill’s vast mortgage losses and when they knew it emerged in court documents filed Sunday evening in a shareholder lawsuit being heard in Federal District Court in Manhattan.

(via New York Times)

It is becoming increasingly difficult for the bankers to maintain the fiction that their job is to enhance shareholder value. That, after all, is the excuse they often use to justify socially destructive actions. It is, we are often told, not their job to do what’s right for the community, state, nation or world, but only to maximize shareholder return. In fact, their job is to maximize their own incomes, shareholders and society alike be damned. The one responsibility they take to heart is the obligation they owe each other, to make sure that no executive goes unpaid or unbonused.

As a lawyer, I particularly enjoyed this:

Bank of America officials declined to comment. Andrew J. Ceresney, a lawyer for Mr. Lewis, also declined to comment on the filing, but he referred to a motion filed on behalf of Mr. Lewis on Sunday contending that the former chief executive did not disclose the losses because he had been advised by the bank’s law firm, Wachtell, Lipton, Rosen & Katz, and by other bank executives that it was not necessary.

I never knew that as a lawyer I could pre-absolve my client’s transgressions. I mean, even priests can only forgive your sins after you commit them. If a client wants to, lets say, fail to give required disclosures about the condition of a home before sale, all he need do is ask me if he has to. I tell him he doesn’t, and boom, no need to tell the buyer that the furnace doesn’t work and the basement floods. Of course, I’m exempt from liability because all I did was give advice; it wasn’t my duty to disclose. But Lewis is going this example one better, because he’s saying his illegal activities were okay because they were also sanctioned by his co-conspirators. Only a banker would make that argument; and only a banker would be likely to get away with it.

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Back from the wet North

Monday, June 4, 2012

I haven’t blogged for a few days, as my wife and I were up in Maine at my XXth College reunion. There is no need to go into further numerical details here, though it is safe to say that I am, to put it kindly, on the brink of geezerdom, or perhaps, already in the abyss. Maine was truly beautiful on Friday, but was awash all day Saturday and that portion of Sunday in which we wended our way back home.

Among other things, I was not able to post a Friday night video, but I did make one musical discovery. It seems Pete Seeger made an appearance at Bowdoin in 1960. It was recorded by the college radio station, which did a top rate job, and the tapes, now lovingly restored, have been made into a two CD set by the Smithsonian. It was displayed at each cash register at both college bookstores, so naturally I bought one, and it’s really quite good. It’s fun to hear Pete singing to an appreciative Bowdoin audience, most of whom, judging by the fate of my own classmates, went on to become good Republicans. Who knows, it’s always possible that Pete made a difference in one of those young lives and turned him (there were no hers) away from a life in “finance” or one of the other criminal arts.

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Chris Powell knows it when he sees it

Tuesday, May 29, 2012

Chris Powell, of the Manchester Journal Inquirer, has been threatened with a libel suit by the World Wide Wrestling company. The offending prose is as follows:

If, having spent several times more money than had ever been spent on a campaign in Connecticut, a candidate isn’t known well enough, whose fault would that be? But of course nearly everyone knew very well who McMahon was — that was the problem. Her practical qualifications for office did not extend beyond her fantastic wealth, and that wealth derived from the business of violence, pornography, and general raunch.

(via The Darien Times)

Powell appears to have responded to a letter demanding a retraction appropriately:

As the May 25 article pointed out, Powell’s column did not mention the Stamford-based WWE. “But answering Flinn by email the editor asked if WWE wanted the letter published in the newspaper and if lawsuit depositions — preparatory interrogations of witnesses — could be undertaken before the Republican Senate primary Aug. 14, adding that he was eager to meet ’Trish’, the shapely actress featured in an infamous WWE program in which McMahon’s husband, Vince, instructs her to undress down to her bra and panties, kneel in the wrestling ring, and bark like a dog in front of an audience of thousands. She complies.”

(via The Darien Times)

Some of the legal aspects of this are discussed here (forgive me, I’m linking to a Republican, but the analysis is basically correct), but I think the emphasis on the actual malice standard is misplaced. The problem with the lawsuit would be more fundamental than that, putting aside that the potential plaintiff is never mentioned in the alleged libel.

As Justice Stewart so famously said, in reference to pornography of the hard core sort: “I shall not today attempt further to define the kinds of material I understand to be embraced within that shorthand description; and perhaps I could never succeed in intelligibly doing so. But I know it when I see it…”

Libel requires proof that someone has uttered a factual untruth about the plaintiff. It rarely reaches expressions of opinion. If even a Supreme Court justice feels privileged to use an “I know it when I see it standard”, it seems only fair to let Powell use the same standard. If hard core pornography is impossible to define, pornography of the softer sort is even more so. One man’s pornography is another’s harmless entertainment, and it’s unlikely in the extreme that any court would hold that characterizing simulated sex with a dead body or the “Trish” doggie scene mentioned above as pornography is not a legitimate expression of opinion. The letter from WWE’s lawyers even compares the entertainment it dishes out to Hollywood. Whether that’s fair to Hollywood or not, the fact is that the works of that city of sin are regularly denounced from many a pulpit.

So, the letter is simply at attempt at intimidation, and Powell’s “bring it on” response is entirely appropriate. Should the WWE do so, then once again the question will arise as to whether, as in 2010, the WWE is impermissibly contributing to the McMahon campaign.

 

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The Butler Did It

Tuesday, May 29, 2012

Seems there was someone at the Vatican with a conscience, who has been leaking stories to the Italian press about criminal activity at Holy Mother Church:

The pope’s butler has been arrested by Vatican police on suspicion of leaking a large number of confidential letters addressed to Benedict XVI which have lifted the lid on alleged corruption and nepotism at the Holy See.

(via The Guardian)

That’s right, folks, the Vatican has its own police, who, like their American counterparts, are more comfortable chasing whistleblowers than corrupt higher ups. The butler, apparently, despite all he’s seen, has a touching faith in the good intentions of Ratzinger, who did bestir himself to react to the leaks-by ordering an investigation of the leaker.

First things first, after all.

As to the title of this post, who could resist?

 

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None so blind

Monday, May 28, 2012

Paul Krugman observes in his blog that we are being subjected to a new, and far more pernicious, kind of political correctness.

Remember the furor over liberal political correctness? Yes, some of it was over the top — but it was mainly silly, not something that actually warped our national discussion.

Today, however, the big threat to our discourse is right-wing political correctness, which — unlike the liberal version — has lots of power and money behind it. And the goal is very much the kind of thing Orwell tried to convey with his notion of Newspeak: to make it impossible to talk, and possibly even think, about ideas that challenge the established order.

Thus, even talking about “the wealthy” brings angry denunciations; we’re supposed to call them “job creators”. Even talking about inequality is “class warfare”.

(via Paul Krugman’s blog)

That sort of correctness, at least to my eyes, is on display in a review in Sunday’s Times by Benjamin Friedman of Timothy Noah’s new book, The Great Divergence, about the causes and potential cures for our rapidly growing inequality.

I haven’t read Noah’s book, so I have no idea whether it addresses the concerns I’ll raise here, but if it does, Friedman ignores it. That is, Friedman totally ignores the extent to which our widening inequality is the result of deliberate and quite obvious government policy. Since 1980, with the exception of the Clinton tax increase, we have seen a series of tax cuts that have disproportionately favored the wealthy. This amounted to a direct transfer of wealth to the rich from the rest of us, particularly because our share of the tax cuts was so often absorbed by increased costs at the state and local levels to make up for decreases in federal expenditures in such things as education. This was entirely out in the open. It was basic math, hidden by a supply side fig leaf that really hid nothing. The drop in the top marginal tax rate is roughly inverse to the rise in inequality. This 10 ton gorilla is certainly worth more scrutiny than the right wing meme, to which Friedman returns again and again, that the educational system the right has done so much to cripple has not been producing workers with the skills needed for the available jobs. As Krugman and Baker have repeatedly pointed out, if that were true, employers would be competing for those workers who are qualified by offering higher wages. That ain’t happening.

There are nuances to almost everything, but the fact is that bringing back something like the marginal rates of the fifties, and, for good measure, lifting the cap on the amount of income subject to the payroll tax, would go a long way toward reducing the widening gap between the .001% and the rest of us. Unfortunately, it’s not politically correct to talk of such things.

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Friday Night Music-Father forgive me, for I know not what I do

Friday, May 25, 2012

I can’t help myself. Another dead rocker, and the choice is made. I actually think that the early Bee Gees stuff is superior to the disco dreck, but I can’t deny there’s something about Stayin’ Alive that is quite infectious. But then, so is the flu.

 

 

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