It's a Christmas-week miracle! The Senate, in a vote that astonished everyone, brought the Food Safety and Modernization Act back from the dead on Monday, as Siddhartha Mahanta reports in Mother Jones. The bill, which will enact tougher consumer protections against E. coli and other deadly contaminants in staples like eggs and peanut butter, died in the Senate last week when the omnibus spending bill it had been folded into kicked the bucket.
At Grist, Tom Philpott explains the initial demise, and the basis for the ultimate resurrection of the bill. The House passed the bill on Tuesday, having already passed it twice before.
President Obama is expected to sign the bill into law, which will usher in the first major overhaul of the country's food safety system in more than 70 years. Food poisoning strikes 48 million Americans (1 in 6), lands 128,000 in the hospital, and kills 3,000 ever year, according to CDC figures released last week. Now that's something to talk about with your relatives around the holiday dinner table.
Wisconsin clinic backs off 2nd trimester abortion care
A clinic in Wisconsin has reneged on its commitment to provide second trimester abortion care, as Judy Shackelford reports in The Progressive. Shackelford is outraged that the Madison Surgery Center walked back on its promise to patients. She knows first hand how important later term abortion access can be.
Shackelford found herself in need of a second trimester abortion when she developed a blood clot in her arm during her second, much-wanted pregnancy. She decided to terminate rather than risk leaving her 7-year-old son motherless. It was hard enough to find an abortion provider when she needed one, but if she needed the procedure today, she would have nowhere to turn.
Teen birth rate at record low
The birth rate for women ages 15-19 fell to 39.1 per 1000 between 2008 and 2009, the National Center for Health Statistics announced Tuesday. Many commentators, including Goddessjaz of feministing attribute the drop to the recession. The economy seems to be an important factor because birth rates dropped in all age groups, not just among teens.
Predictably, proponents of abstinence-only-until-hetero-marriage are trying to take credit for the falling birth rate. It's not clear why they think ab-only is finally starting to work after years ofunrelenting failure. Perhaps it was Bristol Palin's electrifying performance on "Dancing With the Stars"?
Get the government out of my Medicare
We've become accustomed to the ironic spectacle of senior citizens on Medicare-funded scooters decrying the "government takeover of health care." Medicare is wildly popular, even among those who decry "socialized medicine." When the Affordable Care Act is finally implemented, it won't feel like a government program, either. Paul Waldman of The American Prospect wonders if this "private sector" feel will undermine support for the program:
The Republican officials challenging the ACA in court have characterized its individual insurance mandate as an act of tyranny ranking somewhere between the Stalinist purges and Mao's Cultural Revolution. But in the "government takeover" of health care (recently declared the 2010 "Lie of the Year" by the fact-checking site PolitiFact), Americans will continue to visit their private doctors to receive care paid for by their private insurance companies. The irony is that if the ACA actually were a "government takeover," people would end up feeling much better about government's involvement in health care. But since it maintains the private system, conservatives can continue to decry government health care safe in the knowledge that most people under 65 won't know what they're missing, or in another sense, what they're getting.
If people don't realize that they're benefiting from government programs, they are less likely to support those programs. In an attempt to deflect Republican criticism, the Democrats assiduously scrubbed as much of the aura of government off of health reform as they could. This could prove to be a disastrously short-sighted strategy. If health reform works, the government won't get the credit, but rest assured that if it fails, it will take the full measure of blame.
Funding for community health centers at risk
One of the lesser-known provisions of the Affordable Care Act was to expand the capacity of community health centers (CHCs) from 20 million to 40 million patients by 2015. This extra capacity will be key for absorbing the millions of previously uninsured Americans who are slated to get health insurance under the ACA.
CHCs have been praised by Democrats and Republicans as an affordable way to provide quality health care. However, state budget crises are threatening to derail the plan, as Dan Peterson reports for Change.org. States must contribute to the program in order to qualify for federal funding. However, state funding for CHCs has plummeted by 42% since 2007. So far this year, 23 states have cut funding for CHCs and eight have slashed their budgets by 20% or more.
This post features links to the best independent, progressive reporting about health care by members of The Media Consortium. It is free to reprint. Visit the Pulse for a complete list of articles on health care reform, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Audit, The Mulch, and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
Weekly Audit: Millions of Americans Could Lose Unemployment Benefits
Editor's Note: Happy Thanksgiving from the Media Consortium! This week, we aren't stopping The Audit, The Pulse, The Diaspora, or The Mulch, but we are taking a bit of a break. Expect shorter blog posts, and The Diaspora and The Mulch will be posted on Wednesday afternoon, instead of their usual Thursday and Friday postings. We'll return to our normal schedule next week.
The woman gunning for Sen. Harry Reid's (D-NV) job doesn't believe that autism exists.
Yes, you heard right. Sharron Angle believes that the neurodevelopmental disorder know to medical science as "autism" is actually a government-backed hoax to redistribute wealth from hardworking health insurers to pesky kids and their greedy parents.
Angle was caught on tape promising to abolish mandatory insurance coverage for autism. "Everything that they want to throw at us is covered under 'autism'," Angle told the American Association of Underwriters this summer, tracing scare quotes with her fingers as she said "autism."
Care2's Kristina Chew, the mother of a 13-year-old boy with autism, responds to Angle's airy dismissal:
...By saying that you don't think there should be health care for autism, I take it that you don't think that children, and individuals, with disabilities are in need of such things-living with their families and in their communities, healthy and safe, being loved and cared for? Being treated as we would all like to be?
The fact that Angle opposes mandated coverage for private insurers should concern voters, especially since she wants to privatize all government health care programs. In other words, Angle wants to turn health care over to the private sector and stamp out public competition. And yet, Angle's campaign admits that the candidate and her husband receive both government health care and a Civil Service pension, according to Eric Kleefeld of TPM. If Angle is so morally opposed to government health care, she should set an example by declining the coverage.
Andy Kroll of Mother Jones has more on Angle's record: She once told impregnated rape victims to buck up and make "lemons out of lemonade" by bearing their attacker's child. Angle also denounced people on unemployment insurance as "spoiled."
Food vs. health care
It may soon get even harder for poor families to make ends meet. The Senate is poised to slash the extra food stamp benefits in the stimulus before they expire. The Senate already raided $6.7 billion from the the so-called "food stamp cookie jar" to bail out Medicaid and save teachers' jobs at the state level. Now they want to take even more money to fund the child nutrition bill.
The cuts would fund a marginal improvement in school lunches, notes Monica Potts of TAPPED. That's all well and good, but why provide slightly better weekday lunches if the poorest children get less at every other meal?
Annie Lowery of the Washington Independent interviews anti-hunger activist Joel Berg about the cuts. Berg says that if the cuts go through, families will have to make do with considerably less than the current $4.50 per person per day. He notes that Congress wants to cut food stamp benefits in the face of rising food prices.
When families make do with less, healthy foods like fruits and vegetables will be the first casualty. Berg argues that it is economically short-sighted to prematurely terminate one of the most efficient economic stimuli in the entire stimulus package:
And we know that we aren't only feeding people. We come at this from a moral position, a nutritional position, and an economic recovery position. This cut is so insane from an economic position as well - we know food stamps are the most effect form of stimulus. The jury is still out on parts of the stimulus - but the jury isn't out on food stamps. It was a 1,000 percent, beyond home run grand slam success, if you'll excuse me mixing metaphors. The money went to people who needed it, rapidly, and without a lot of bureaucracy.
In the Progressive, Ruth Conniff has a personal take on the politics of improving school lunches. Her kids' school got a USDA Fresh Fruits and Vegetables grant to introduce more local produce into school meals.
"Bridalplasty"
The laws of Reality TV: 1) The most important thing in life is to be very beautiful so that a man will want to marry you; 2) You have until your wedding day to make yourself look like someone else.
The E! network is launching a new reality show in which brides-to-be receive free cosmetic surgery to make them look acceptable for their Special Day, as Stephanie Hallett reports at Ms. blog. Hallett notes that armchair psychiatrists are already diagnosing the contestants with Body Dysmorphic Disorder, a condition that causes sufferers to become obsessed with imagined physical imperfections.
Hallett also argues that competitive plastic surgery shows like Bridalplasty and The Swan are dramatic exaggerations. Labeling the contestants as "sick" or "crazy" implies that they are limited-edition freaks, not individuals on the extreme end of a continuum of self-loathing that affects most women.
Ectopic pregnancy
Anti-choicers have already attacked hormonal birth control as crypto-abortion. Their next target may be lifesaving surgery for a deadly complication of pregnancy. At RH Reality Check, Lon Newman writes about a young woman that survived a life threatening ectopic pregnancy.
An ectopic pregnancy occurs when a fertilized egg takes root outside the uterus, nearly always in a fallopian tube. Tubal pregnancies are among the deadliest gynecological emergencies because the woman can rapidly bleed to death if the tube ruptures. Obviously, once a fertilized egg takes root outside the uterus, there is no chance that it will survive. However, some anti-choice extremists still maintain that treating ectopic pregnancies is a kind of abortion.
One of the ectopic pregnancy survivor's friends actually told her that she should have respected "God's will" and refused lifesaving surgery. "I have had friends who said that I should have 'gone with God's will,' imposing their beliefs on my will to live," the woman said.
Some friend.
This post features links to the best independent, progressive reporting about health care by members of The Media Consortium. It is free to reprint. Visit the Pulse for a complete list of articles on health care reform, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Audit, The Mulch, and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
Though Arizona's SB 1070 went into effect without its most controversial provisions, the legislation's stated intent-attrition through enforcement-is nevertheless gaining traction among anti-immigrant legislators across the nation. In the wake of the law's enactment, other states are coming out in support of Arizona, some developing policy modeled after SB 1070. Others even hope to alter the U.S. constitution to deny "birthright citizenship" to children of undocumented immigrants.
Yesterday, Senate Majority Leader Harry Reid (D-NV) introduced a limited energy bill that responds to the oil spill and promotes energy efficiency. Reid's action is a signal that the Senate will not pass climate legislation before November, although Sen. John Kerry (D-MA) said that a climate bill could come up in the lame-duck session following the election.
"The Senate's climate bill is officially dead," Kate Sheppard writes at Mother Jones. "And given that Democrats will almost certainly hold fewer seats in Congress next year, major action on the climate is unlikely to be revived anytime soon."
Since 2009, expectations for a bill regulating carbon emissions have steadily declined. After this latest failure in the Senate, the best near-term hope for addressing climate change comes from the Environmental Protection Agency, which still has the power to regulate carbon emissions.
At the Washington Independent, Andrew Restuccia reports that Sen. Reid's bill will likely hold oil companies more financially accountable for spills by lifting the cap on their liability for economic damages and will nudge homeowners towards energy efficiency.
But, Restuccia writes, a sources tells him that "significantly...the bill might not include a renewable energy standard." Such a standard would require an increasing percentage of the country's electricity to come from sources like wind and solar.
The energy bill could create jobs
Sen. Reid has often emphasized that an energy bill is also a jobs bill: Innovation in the clean energy sector creates employment opportunities at a time when they're sorely needed. Dropping the renewable energy standard could also mean diminishing the potential for job creation.
"The Department of Energy says, if we get to 20 percent of the nation's electricity from wind by the year 2030"-one of the less ambitious standards proposed-"it would mean 3,000 to 4,000 new jobs in most of our states," Chuck Hassebrook, executive director of the Center for Rural Affairs, said. "There's not a lot of things out there bringing that kind of new economic opportunity to rural America, so it could be a great thing for us."
The Gulf Coast connection
The need for job opportunities extends beyond rural areas. In the Gulf Coast, for instance, even fishermen left idle by the oil spill are hoping the oil industry resumes drilling soon. Their communities need those jobs. As Jerome Ringo, who worked for two decades in the oil industry, writes at The Progressive, "With unemployment still in the double digits across the nation, and the people on the Gulf Coast struggling to survive, we need far more clean energy job growth than what we're seeing right now."
That's not going to happen without a long-term commitment to clean energy from the government, Ringo argues. "Businesses need this signal to know how to invest, and, with this signal, they will move in a direction that creates many more jobs in areas like renewable energy and electric cars for people like me who once worked in oil and gas."
Climate refugees
That transition won't happen overnight, but it's important to start in that direction as soon as possible. In the United States, the effects of climate change are affecting people-farmers dealing with strange weather, for instance-but the impact is not obvious in the every day lives of Americans.
Not everyone has that luxury, though. LinkTV's Earth Focus reports on the plight of climate refuges in New Guinea. In a new film, Jennifer Redfearn documents the story of the country's Carteret Islanders-the first group to organize a community-wide evacuation of their home in the face of climate change. As the sea level rises around their island, storm surges increase and fresh water becomes salty. Carteret Islanders are looking to move to Bougainville, a neighboring island recovering from civil war.
"I've heard about you Carterets. You are an easy-going people," one leader tells them. "Here it is totally different."
The longer Americans wait to start scaling back our energy use, the more people around the globe will be displaced.
Hydrofracking
When moving towards clean energy, however, it is important that leaders in Washington and on the state level watch emerging energy companies closely. For instance, The New York Times reports that Reid's bill will promote natural gas production. But as natural gas grows more popular as a bridge fuel, communities and legislators are discovering more dangerous environmental impacts from the hydrofracture drilling process that companies use to extract the gas from shale deposits.
Josh Fox's recent documentary, Gasland, showed that residents across the country in fracking areas have had their drinking water contaminated. The natural gas industry is pushing back hard against the claims his film makes. Truthout reports that "Energy In Depth (EID), an information service created and funded by the oil and gas industry, recently posted 'Debunking Gasland,' a point-by-point argument against the Fox's startling discoveries. EID paints Fox as a 'purveyor of the avant-garde' who is guilty of 'flat-out making stuff up.'"
Fox isn't the only one to voice concerns about water quality, either. GritTV recently heard from residents in the Delaware River Basin about their concerns. "No water for gas" is their rallying cry.
Water, water, everywhere
Fox is fighting back, but the response to his film shows that the industry is ready to push back against any criticisms of its practices. It has also resisted effects by regulators to require disclose of the chemicals it uses in its extraction process.
But as the Washington Independent's Restuccia reports, "Momentum is building in the House to pass new regulations on the controversial practice of hydraulic fracturing, in which water, sand and a mixture of potentially harmful chemicals are injected into the ground in order to gain access to natural gas."
Unfortunately, if the fate of the climate bill is any indication, any environmental legislation, even with momentum, has little chance of moving through Congress right now.
This post features links to the best independent, progressive reporting about the environment by members of The Media Consortium. It is free to reprint. Visit the Mulch for a complete list of articles on environmental issues, or follow us on Twitter. And for the best progressive reporting on critical economy, health care and immigration issues, check out The Audit, The Pulse, and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
On Monday, President Barack Obama nominated solicitor general Elena Kagan to replace retiring Justice John Paul Stevens on the Supreme Court. Kagan's nomination has raised eyebrows among progressives. Despite a long career in legal academia, Kagan has published very little. She seems to have studiously avoided taking a stand on almost any controversial issue. Ruth Coniff of the Progressive calls the Kagan pick "a triumph of the bland."
"Partial Birth Abortion" ban
As a White House aide, Kagan wrote a memo urging President Bill Clinton to support a ban on so-called "partial birth abortion." At the time, the House had passed a sweeping late-term abortion ban with no exceptions for the life and health of the mother. Clinton asked Kagan whether he should throw his support behind a more moderate Senate version of the same bill. She recommended a "compromise"-a ban with a maternal health exemption. In the end, Congress passed the extreme version and Clinton vetoed it.
Suzy Khimm of Mother Jones characterizes the memo as "more indicative of a political strategy than a legal argument." In other words, Kagan was giving strategic advice to the president about what would be politically feasible, not legal advice about the government's powers to regulate abortion. Kagan argued that the president should support the "compromise" position even though the Justice Department thought it was unconstitutional, according to Jodi Jacobson of RH Reality Check.
At TAPPED, Monica Potts argues that the memo gives us little indication of how Kagan would vote on abortion as a justice.
No Harriet Miers
There's no question that Kagan is possessed of a formidable intellect. Stephanie Mencimer of Mother Jones quotes one of her former law school students, Elie Mystal, sharing his experience with Kagan on the blog Above the Law:
Like Frodo on Weathertop, there are some wounds that never fully heal. Professor Kagan massacred me intellectually, and brutalized my pride. I got some form of a B in her class (I honestly don't remember if there was a modifier - I've tried to suppress those memories). Kagan was a frightening professor for those who wanted to match wits with the brightest legal minds in the world. For people like me, people who just wanted to get through law school with minimal mental damage, Kagan was nothing short of terrifying.
That's the best news I've heard all day.
Kagan has never been a judge, but that's not necessarily a deal-breaker in itself. As Steve Benen points out at the Washington Monthly, over a third of the 111 justices of the Supreme Court have had no previous judging experience.
A missed opportunity
Scott Lemieux argues in the American Prospect that Obama is wasting a rare political opportunity to confirm a more liberal justice. Right now, the Democrats still have a sizable, though not filibuster-proof, majority in the Senate. Lemieux argues that Obama is almost certain to get another Supreme Court pick before the end of his term. Then again, he points out, the Democrats are likely to lose Senate seats in the midterm elections.
If Obama were ever going to get a strong liberal on the bench, this would have been the time. No date has been set for a confirmation hearing. Kagan is in Washington today, courting lawmakers.
This post features links to the best independent, progressive reporting about health care by members of The Media Consortium. It is free to reprint. Visit the Pulse for a complete list of articles on health care reform, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Audit, The Mulch, and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
by Lindsay Beyerstein, Media Consortium blogger
On Monday, President Barack Obama nominated solicitor general Elena Kagan to replace retiring Justice John Paul Stevens on the Supreme Court. Kagan's nomination has raised eyebrows among progressives. Despite a long career in legal academia, Kagan has published very little. She seems to have studiously avoided taking a stand on almost any controversial issue. Ruth Conniff of the Progressive calls the Kagan pick "a triumph of the bland."
"Partial Birth Abortion" ban
As a White House aide, Kagan wrote a memo urging President Bill Clinton to support a ban on so-called "partial birth abortion." At the time, the House had passed a sweeping late-term abortion ban with no exceptions for the life and health of the mother. Clinton asked Kagan whether he should throw his support behind a more moderate Senate version of the same bill. She recommended a "compromise"-a ban with a maternal health exemption. In the end, Congress passed the extreme version and Clinton vetoed it.
Suzy Khimm of Mother Jones characterizes the memo as "more indicative of a political strategy than a legal argument." In other words, Kagan was giving strategic advice to the president about what would be politically feasible, not legal advice about the government's powers to regulate abortion. Kagan argued that the president should support the "compromise" position even though the Justice Department thought it was unconstitutional, according to Jodi Jacobson of RH Reality Check.
At TAPPED, Monica Potts argues that the memo gives us little indication of how Kagan would vote on abortion as a justice.
No Harriet Miers
There's no question that Kagan is possessed of a formidable intellect. Stephanie Mencimer of Mother Jones quotes one of her former law school students, Elie Mystal, sharing his experience with Kagan on the blog Above the Law:
Like Frodo on Weathertop, there are some wounds that never fully heal. Professor Kagan massacred me intellectually, and brutalized my pride. I got some form of a B in her class (I honestly don't remember if there was a modifier - I've tried to suppress those memories). Kagan was a frightening professor for those who wanted to match wits with the brightest legal minds in the world. For people like me, people who just wanted to get through law school with minimal mental damage, Kagan was nothing short of terrifying.
That's the best news I've heard all day.
Kagan has never been a judge, but that's not necessarily a deal-breaker in itself. As Steve Benen points out at the Washington Monthly, over a third of the 111 justices of the Supreme Court have had no previous judging experience.
A missed opportunity
Scott Lemieux argues in the American Prospect that Obama is wasting a rare political opportunity to confirm a more liberal justice. Right now, the Democrats still have a sizable, though not filibuster-proof, majority in the Senate. Lemieux argues that Obama is almost certain to get another Supreme Court pick before the end of his term. Then again, he points out, the Democrats are likely to lose Senate seats in the midterm elections.
If Obama were ever going to get a strong liberal on the bench, this would have been the time. No date has been set for a confirmation hearing. Kagan is in Washington today, courting lawmakers.
This post features links to the best independent, progressive reporting about health care by members of The Media Consortium. It is free to reprint. Visit the Pulse for a complete list of articles on health care reform, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Audit, The Mulch, and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
On Monday, climate activists, nonprofit leaders, and governmental officials will gather in Cochabamba, Bolivia, to look for new ideas to address climate change. The conference, organized by leading social organizations like 350.0rg, "will advocate the right to "live well," as opposed to the economic principle of uninterrupted growth," as Inter Press Service explains. In the absence of real leadership from the world's governments, the conferees at Cochabamba are looking for solutions "committed to the rights of people and environment."
The United States certainly isn't stepping up. Sen. John Kerry (D-MA), along with Sen. Joe Lieberman (I-CT) and Sen. Lindsay Graham (R-SC), were supposed to release their climate legislation next week, just in time for Earth Day. But yesterday the word came down that the release was being pushed back by another week, to April 26.
No matter when it finally arrives, like other recent environmental initiatives, this round of climate legislation falls short. Even if Congress manages to pass a bill-and there's no guarantee-it will likely leave plenty of room for the coal, oil, and gas industries to continue pouring carbon into the atmosphere. And a wimpy effort from Congress will hinder international work to limit carbon emissions: As a prime polluter, the United States needs to put forward a real plan for change.
Kerry, Graham, and Lieberman
Although the text of the bill is not public yet, it is likely that this attempt at Senate climate legislation will limit carbon emissions only among utilities and gradually phase in other sectors of the economy. On Democracy Now!, environmentalist Bill McKibben called the bill "an incredible accumulation of gifts to all the energy industries, in the hopes that they won't provide too much opposition to what's a very weak greenhouse gas pact."
Climate reform began with a leaner idea, a cap-and-trade system that limited carbon emissions while encouraging innovation. The Nation's editors document the transformation of climate reform from the Obama administration's original cap-and-trade proposal to the behemoth tangle it has become. Both the House and the Senate fattened their versions of climate legislation with treats for the energy industry. The Senate's new idea to gradually expand emissions reduction through a bundle of energy bills only opens up more opportunities for influence.
"Some of these pieces of legislation may pass; others may fail; all are ripe for gaming by corporate lobbies," the editors write. "Kerry-Lieberman-Graham would also skew subsidies in the wrong direction, throwing billions at "clean coal" technologies, nuclear power plants and offshore drilling, a questionable gambit favored by the Obama administration to garner support from Republicans and representatives from oil-, gas- and coal-producing states."
Even with these goodies, the climate bill may not pass. The Washington Independent rounds up the D.C. players to watch as the next fight unfolds, including the Chamber of Commerce's William Kovacs and the Environmental Protection Agency's Lisa Jackson.
Green leftovers
In theory, the climate bill should not be America's only ride to a greener future. But the other vehicles for green change choked during start-up. The EPA was going to regulate carbon emissions, but Congress has reared against that effort. The climate bill could snatch away that power from the executive branch.
If companies won't limit their carbon emissions, individuals still have the option for action. But as Heather Rogers explains in The Nation, carbon offsets, one of the most popular mechanisms for minimizing carbon use "are a dubious enterprise."
"To begin with, they don't cut greenhouse gases immediately but only over the life of a project, and that can take years--some tree-planting efforts need a century to do the work. And a project is effective only if it's successfully followed through; trees can die or get cut down, unforeseen ecological destruction might be triggered or the projects may simply go unbuilt."
The pull of carbon offsets should diminish as energy use in buildings, cars, food, and flights gains in efficiency and uses less carbon. But if the green jobs sector is any indication, that revolution has been slow in coming. ColorLines reports that "there are no firm numbers on how many newly trained green workers are still jobless. But stories abound of programs that turn out workers with new, promising skills-in solar panel installation and weatherization, in places like Seattle and Chicago-and who nonetheless can't find jobs."
Cochabamba's unique approach
These failures and setbacks don't just affect Americans; they keep our leaders from negotiating with their international peers. The United Nations led a conference last winter in Copenhagen that promised to hash out carbon limits, yet produced no binding agreement. This coming winter, the UN will try again in Mexico, but if the United States shows up with the scant plan put forward by Kerry, Graham, and Lieberman, those negotiations have little promise.
In Cochabamba, leaders from inside and outside the government will attend a summit to discuss the future of climate change action. In The Progressive, Teo Ballve writes that,
"One of the bolder ideas is the creation of a global climate justice tribunal that could serve as an enforcement mechanism. And conference participants are already working on a "Universal Declaration of Mother Earth Rights" meant to parallel the U.N.'s landmark Universal Declaration of Human Rights of 1948."
With U.S. government action paling, it might take outside ideas like these to revitalize the push towards a green future. By the end of next week, we'll see if the Cochabamba group made any more progress than the bigwigs at Copenhagen.
This post features links to the best independent, progressive reporting about the environment by members of The Media Consortium. It is free to reprint. Visit the Mulch for a complete list of articles on environmental issues, or follow us on Twitter. And for the best progressive reporting on critical economy, health care and immigration issues, check out The Audit, The Pulse, and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
Yesterday, Nebraska's Republican governor Dave Heineman signed a sweeping new law that criminalizes almost all abortions after 20 weeks' gestation and another bill that forces women to undergo extensive mental health assessment prior to obtaining an abortion before 20 weeks.
Intimidating providers
Monica Potts of TAPPED explains that the laws are meant to have a chilling effect on all abortion providers in Nebraska. In the wake of last year's assassination of Kansas abortion provider Dr. George Tiller, Dr. LeRoy Carhart of Nebraska began providing late-term abortions. According to Potts, the new abortion legislation is probably designed to run Dr. Carhart out of town.
An anti-choice Catch-22
Robin Marty of RH Reality Check notes the glaring contradictions between the two Nebraska abortion laws: Before 20 weeks of gestation, the state is so concerned about a woman's health that they will force her to seek a mental health assessment to spare her the trauma of an ill-advised abortion. It seems that Nebraska legislators think women are so fragile that they can't decide on their own whether an abortion will be unduly upsetting. Yet, after 20 weeks, a woman is not entitled to a "life of the woman" exemption even if a doctor determines that she is likely to commit suicide if she is forced to continue her pregnancy.
The second round of debate was held [Monday] on the Pain-Capable Unborn Child Protection Act, a bill created almost entirely as a vehicle for getting anti-choice legislation challenged and potentially reviewed by the Supreme Court. Unlike every other anti-choice law that has so far passed in this country, LB 1103 refuses to provide an exemption for a mother's mental health, regardless of the fact that prior to 20 weeks a pregnant woman's mental health was so valuable that the state wants to advocate mandatory screenings to protect it.
Vanessa Valenti of Feministing writes of the Nebraska law:
The blatant anti-choice and ableist implications in these bills are just atrocious. Not only will some women be forced to carry their pregnancies to term with no mental health exception, but doctors will be terrified to perform abortions in fear of not correctly adhering to obscure these screening rules.
A collision course with Roe?
Gov. Heineman vowed to defend the new laws against any legal challenges. The Nebraska law bans abortion based on the purported ability of fetuses to feel pain, not their ability to survive outside the womb. The Supreme Court has ruled that states cannot ban abortion of pre-viable fetuses. According to the accepted legal reasoning, if a fetus is too immature to survive outside the woman's body, the woman has the right to withdraw the support of her body by terminating the pregnancy.
Conveniently, anti-choicers say that they have scientific evidence that pre-viable fetuses can feel pain. This dubious evidence isn't just a pretext for banning abortion earlier, it puts the bill on a crash course with Roe. If the abortion issue is really about a woman's right to control her body, then the fetal pain issue is a red herring. A woman can legally inflict pain on a full-grown person if she strikes in self-defense to protect her bodily autonomy. Nebraska is launching a full frontal assault on women's rights. In Nebraska the pain of a non-viable fetus allegedly matters more than a woman's freedom. We'll see what the Supreme Court says about that.
How Justice Stevens' retirement fits in
The wheels were set in motion just as the leading liberal on the Supreme Court, Justice John Paul Stevens, announced his retirement. In The Progressive, Matthew Rothschild, the son of Stevens' former law partner, recalls some of Stevens' key pro-choice opinions over the course of his long career. For example:
In the 2000 Nebraska "partial-birth-abortion" case, Stevens stated: It is "impossible for me to understand how a State has any legitimate interest in requiring a doctor to follow any procedure other than the one that he or she reasonably believes will best protect the woman in her exercise of this constitutional liberty."
As we look ahead to a Supreme Court confirmation battle, the Nebraska abortion bans illustrate why the stakes are so high. The Court is losing a leading champion of reproductive choice. President Barack Obama will face intense pressure from the liberal base to replace him with a nominee whose record on choice is equally strong. As Scott Lemieux argues at TAPPED, only a strong liberal will be able to hold the line against the conservative cadre of Scalia, Thomas, Roberts, and Alito.
This post features links to the best independent, progressive reporting about health care by members of The Media Consortium. It is free to reprint. Visit the Pulse for a complete list of articles on health care reform, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Audit, The Mulch, and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
Former Rep. Eric Massa (D-NY) punked conservative talk show host Glenn Beck yesterday by recanting his earlier allegations that House Democrats forced him out of office because he refused to vote for health care reform. Massa resigned on Monday amidst allegations that he sexually harassed one or more male staffers.
Adele Stan has a nice recap of the implosion of Massa's political career at AlterNet. Massa initially said he was stepping down because he had cancer. Then the news broke that the House Ethics Committee was probing allegations that Massa sexually harassed a male staffer.
Beck gave Massa the entire show. Clearly Beck was hoping the former congressman would lay bare nefarious wheeling and dealing by House Democrats to pass health care reform. Steve Benen of the Washington Monthly argues that the Massa train wreck shows the weakness in the whole Beck schtick. Beck didn't bother to find out whether there was a conspiracy. He just assumed Massa was going to tell him what he wanted to hear.
Massa and the health care reform conspiracy
As Tim Fernholtz points out in TAPPED, the notion that Massa was forced out over his stance on health care reform was never very promising, even by conspiracy theory standards: Why would Massa take this moment to start listening to the Democratic leadership, having blithely ignored them throughout his brief political career?
More to the point, White House Chief of Staff Rahm Emanuel didn't force Eric Massa to act like a drunken sailor in front of his staff. Clearly, the Dems are relieved to see Massa go. In addition to a near total lack of interpersonal boundaries, he was an unshakable "no" on health reform. The guy is clearly a loose cannon, in the saltiest and most nautical sense. If House Dems had seized the opportunity to get rid of him, that would have been more sound management than conspiracy.
'I failed.'
But under the bright lights, Massa dropped the conspiracy allegations and blamed himself for ethical lapses, according Eric Kleefeld of TPMDC. "I wasn't forced out. I forced myself out. I failed," said Massa.
In fact, Massa seemed eager to preemptively confess to even more inappropriate behavior: "Now, they're saying I groped a male staffer. Yes, I did. Not only did I grope him, I tickled him until he couldn't breathe and four guys jumped on top of me," Massa told Beck, "It was my 50th birthday. It was kill the old guy."
Massa even brought visual aids to assist in his own indictment. He showed Beck a scrapbook of a "crossing the line" ceremony from his Navy days. "It looks like an orgy in Caligula," Massa chirped. His point being that he never got out of the creepy, gropey habits he picked up in the Navy.
He even whipped out an x-ray of his own gut to prove that he really does-or at any rate, really might-have cancer.
By the end of the show, Beck apologized to America for wasting the country's time.
Kucinich still opposed to reform
Meanwhile, Rep. Dennis Kucinich (D-Ohio) remains steadfast in his opposition to health care reform, calling it a giveaway to the insurance companies. On the Ed Schultz Show, insurance company whistleblower Wendell Potter urged Kucinich to quit posturing and take the deal, according to Ruth Conniff of The Progressive. Potter agrees that the deal is a massive giveaway to insurers, but he thinks Kucinich is unrealistic to hold out for a better deal.
Stupak smoke signals
Fervent anti-choicer Rep. Bart Stupak (D-MI) has been threatening for months to derail health care reform over the abortion issue. This week, Stupak was back in the news with some cryptic remarks. He told a town meeting that there was "no such thing as a compromise" on the abortion issue, but he also said that he was more optimistic than he was a week ago that the House leadership could offer him some kind of acceptable accommodation. Stupack insisted that any such deal would have to be written before the bill goes to the Senate for a vote.
This post features links to the best independent, progressive reporting about health care by members of The Media Consortium. It is free to reprint. Visit the Pulse for a complete list of articles on health care reform, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Audit, The Mulch, and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
Progressives have waited a year for President Barack Obama to roll up his sleeves and fight for serious financial reform. Last week, he finally jumped in the ring, telling weak-kneed Senators to stand up to Wall Street and endorsing a critical ban on risky securities trading.
But while it was good to see Obama start throwing financial punches against the banks, this week he also started throwing them at workers. His recent rhetoric on implementing a spending freeze to reduce the deficit is an economic catastrophe in the making. It indicates that Obama is willing to sacrifice jobs to try and win over Republicans.
A spending freeze would kill jobs
A three-year spending freeze is crazy talk. It's a right-wing ideologue's dream that accomplishes nothing and drives millions of people out of work. John McCain campaigned on it during his 2008 presidential run. Our long-term deficit problems are tied to the rising cost of health care. If you want to fix the deficit, fix health care. In the short-term, there is no deficit problem. In fact, the U.S. fiscal position looks very good compared to many European nations.
As Matthew Rothschild notes for The Progressive, a spending freeze would kill any legislation to create jobs. With unemployment at 10%, the economy desperately needs another round of government spending to put people back to work. While the abrupt policy reversal is clearly a political ploy, voters care much more about results than they care about ideology. If Obama actively sabotages the job market to win over conservative deficit-hawks, he'll be putting his political future in serious jeopardy.
And yet, as Steve Benen notes for The Washington Monthly, Obama's recent, ramped-up rhetoric against banks still marks a significant change in tone. For most of the year, Obama hasn't been involved in the financial reform debate at all, letting Treasury Secretary Timothy Geithner capitulate to Wall Street and the politicians it owns. Benen highlights the end of Obama's speech announcing his new banking rules on Jan. 21. Obama says:
So if these folks want a fight, it's a fight I'm ready to have. And my resolve is only strengthened when I see a return to old practices at some of the very firms fighting reform; and when I see soaring profits and obscene bonuses at some of the very firms claiming that they can't lend more to small business, they can't keep credit card rates low, they can't pay a fee to refund taxpayers for the bailout without passing on the cost to shareholders or customers -- that's the claims they're making. It's exactly this kind of irresponsibility that makes clear reform is necessary.
Saving the CFPA
Katrina vanden Huevel lays out Obama's new financial reform agenda in a column for The Nation, praising a new $117 billion tax on the nation's largest banks, a plan to cap overall bank size, and a proposal to ban high-risk trading by economically essential commercial banks (more on thatlater).
But vanden Huevel also rightfully denounces recent indications that Senate Banking Committee Chairman Chris Dodd (D-CT) may cave to lobbyist pressure and drop the measure to create a new Consumer Financial Protection Agency (CFPA) from the Senate's financial reform bill.
The death of the CFPA would be a devastating blow to reform. Existing bank regulatory agencies see their primary job as protecting bank profits, meaning that any time the interests of the U.S. consumer conflict with those of bank balance sheets, the regulators have shafted consumers. Current federal banking regulators not only failed to enforce consumer protection laws, they went so far as to join the bank lobby in suing state regulators who were trying to protect households from predatory lending.
Fortunately, Obama isn't taking Dodd's bank lobby-induced cowardice sitting down. At Talking Points Memo, Rachel Slajda highlights a New York Times report that claims Obama met with Dodd and told him that the CFPA is a "non-negotiable."
Commercial banks are important
There's a lot to like in Obama's plan to bar commercial banks from participating in risky securities trading. As I emphasize in a piece for AlterNet, commercial banks form the backbone of the U.S. economy. They're the institutions that accept your paychecks as deposits and keep businesses moving with loans. They also form the core of the economy's payments system. Without commercial banks, nobody can pay anybody else for goods and services-the economy literally shuts down.
Nevertheless, in the late 1990s, regulators and lawmakers tore down the walls between commercial banking and riskier, complex securities trading, allowing these critical economic utilities to gamble in the capital markets like high-flying hedge funds. That kind of behavior puts the entire economy in jeopardy, and Obama's proposal to end such behavior is very urgently needed.
But, as vanden Huevel and I both note, Obama's cap on bank size is a little too timid. Obama indicated that he wants to prevent big banks from getting bigger going forward. That misses the point.
Bustin' up "too big to fail"
Financial giants like Citigroup and Bank of America are already much too big and pose an economic threat. That's why we refer to them as "too big to fail," and why the government had to devote over $17 trillion to saving them. Obama must cap bank size and break up our behemoth banks into companies that are small enough to fail without wreaking havoc on the economy. A good rule of thumb: 1% of gross domestic product.
Shouting down the bank lobbyists
In Mother Jones, David Corn emphasizes that Obama's credentials as a serious reformer depend more on his policy maneuvering than on his rhetoric. While it has been extremely promising see Obama finally demanding something serious from the financial giants that taxpayers saved, he'll have to shout down the bank lobbyists to secure meaningful economic-or political-gains. Corn writes:
If Obama aims to be widely regarded as a warrior for the middle class, he will have to take some mighty swings that cut through the clutter. Proclaiming 'I am a fighter' will not be enough. He will have to name his foes (financial institutions, insurance companies, Republicans, and perhaps recalcitrant Democrats) and truly exchange blows.
Obama's stance on the CFPA alone should be enough to get the lobbyists into a lather, but he'll have to keep up the fight on multiple fronts if he wants to protect our economy from the Wall Street recklessness that spurred millions of foreclosures and sent the unemployment rate soaring into double digits.
Last week, Obama finally told us he was willing to fight for economic change. Now it looks like he's going to attack anyone who is looking for a job. Let's hope he turns it around before it's too late.
This post features links to the best independent, progressive reporting about the economy by members of The Media Consortium. It is free to reprint. Visit the Audit for a complete list of articles on economic issues, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Mulch, The Pulse and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
First it was immigrants from Mexico, now Muslims in the armed services. After the tragic shootings at Fort Hood, conservative pundits are verbally attacking Muslims and Arab-Americans, much like they have vilified the immigrant community. The complexities of Islamic faith are being glossed over and "Muslim Terrorist" is stamped upon any act of violence involving their community. As a result, nuanced voices are buried in favor of suspicion and violence.
On Friday, we learned that the U.S. unemployment rate officially broke 10% for the first time since the early Reagan years. This is about as bad as it gets for a modern, developed economy. No economic force takes a heavier toll on a society than rampant joblessness, and few personal setbacks take a deeper psychological toll than being out of a job for months on end. If Congress and President Obama don't do something to create jobs fast, both are going to pay a hefty political price when next year's mid-term elections roll around.
So how bad is it? In October, the economy shed 190,000 jobs and the unemployment rate jumped from 9.8% to 10.2%. That percentage is the most optimistic reading of the labor market in Friday's report. If you take people who want full-time jobs but are settling for part-time work, then add those who have simply given up on finding a job, the rate is a massive 17.5%.
The problem is not that either Obama or Congress have failed to act on the problem, but rather that they have not done enough. When Congress was moving on Obama's $787 billion economic stimulus package back in February, we were shedding upwards of 700,000 jobs a month. So the stimulus package has worked-it's probably helped keep unemployment from jumping to 12% or 13%. But this is cold comfort to the nation's 15.7 million unemployed, 5.6 million of whom have been out of a job for more than six months.
As Robert Reich notes for Salon, Obama's economic advisers dramatically underestimated how bad things would get when they crafted the stimulus package. As a result, the package was too small and unemployment has remained high. Obama needs to go back to Congress and demand more economic relief funding. Republicans will continue to whine about government spending to excuse their obstructionism, of course, and conservative Democrats will probably start sweating, too-Sen. Ben Nelson (D-NE) helped cut back the original stimulus bill in February to help boost his "centrist" credentials. This of course had nothing to do with economics or policy. Government spending is what saves the economy in a recession. In a downturn as severe as this one, it takes a lot of spending to turn things around.
But as Reich notes, Nelson and his cohorts will have a lot more to worry about in the 2010 elections if the economy doesn't actually improve over the next year. And few economists think it will. The Congressional Budget Office, which is run by a conservative economist named Douglas Elmendorf, projects an average unemployment rate of over 10% in 2010. That's worse than this year. Democrats from swing districts need to support economic relief packages. Continued economic malaise will severely hurt them at the polls.
Congress finally took some action on joblessness on Thursday, voting to extend unemployment benefits for an additional 14 weeks. If we want the economy to recover, we need people to spend money, but if people aren't working, they don't have any money to spend. So the government cuts people checks to help them get by and stimulate a demand for goods and services. Even most conservative economists thinks this is a good idea.
But as Kevin Drum notes for Mother Jones, the soundness of the policy did nothing to prevent Republicans from fighting the effort to extend benefits tooth-and-nail. The bill had to overcome three-that's right, three-filibusters in the Senate from Republicans, who held up the bill for weeks for no apparent reason. In a blog post for The Washington Monthly, Steve Benen explains the economic cost of this obstructionism: In the weeks of delay, 200,000 people looking for work stopped receiving benefits.
But extending unemployment benefits will not solve our economic woes. The total program is just $2.4 billion, a drop in the bucket compared to the trillions of dollars the government put up to salvage Wall Street. $2.4 billion is not enough to reverse the unemployment trend. Cutting the checks certainly helps, but as Matthew Rothschild emphasizes for The Progressive, we need an economic policy that actually puts people back to work. We've known for months that the stimulus was too small and watched the labor market continue to deteriorate. We need more than tweaks at the economic margins, we need a robust job creation plan.
As Stephen Franklin notes for Working In These Times, we already know that the recession has created a significant jump in the nation's poverty rate. According to official government statistics, the rate climbed from 12.5% to 13.2% in 2008, the largest increase since 1991. But the National Academy of Science thinks the government statistics are misleading, as they account for rising costs associated with medical care, transportation, child care and different regional living standards, as Franklin notes. Taking these factors into account, the National Academy of Sciences calculates the actual poverty rate to be 15.8%. That's an additional 7 million people living in poverty, for a total of over 47 million. That's more than the entire population of the New York, Los Angeles, Chicago, and Philadelphia metropolitan areas combined. What's worse, we don't have poverty statistics for this year, when the most severe economic damage was been dealt.
Workers are facing tough economic prospects around the world. Writing for The Nation, Kristina Rizga details Latvia's economic turmoil. Just like the US, overexcited bankers in Latvia inflated a massive real estate bubble that took down the entire economy when it burst. But with the bubble burst, much of the country is now out of a job and stuck with a mortgage worth far less than what they paid for it. It's almost exactly the same story we've seen at home.
No domestic economic problem is more pressing than our epic levels of unemployment. We need another round of stimulus to get people working again. If not, we'll see the same public unrest here as in Eastern Europe.
This post features links to the best independent, progressive reporting about the economy by members of The Media Consortium. It is free to reprint. Visit the Audit for a complete list of articles on economic issues, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Mulch, The Pulse and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
Last week, President Barack Obama released key legislation designed to fight the banking industry's too-big-to-fail problem. But Obama's plan doesn't actually address too-big-to-fail at all. It reinforces a broken system in which economically dangerous companies are bailed out whenever they drive themselves to the brink of failure.
If we want the economy to support all people, we have to break up the big banks and start treating the creation of good jobs as an economic priority on par with Wall Street rescues.
The editors of The Nation break the political debate over banking into three camps:
The first camp is composed of bank lobbyists, Republicans and conservative Democrats and wants to do nothing.
Camp two, endorsed by the White House and influential Rep. Barney Frank (D-MA), would impose tougher regulations on too-big-to-fail banks to keep them from getting out of control.
The third camp wants to go even further: If a bank is too-big-to-fail, it is also too-big-to-regulate. Companies that pose a danger to the economy have to be split up into smaller firms that cannot induce economic ruin.
The Nation editors rightly see the third strategy as the most sensible. While the "break-up-the-banks" policy is being portrayed as a left-wing pipe dream by cable news networks, the policy actually relies on an age-old observation of conservative economists. Regulators make mistakes, and they often get co-opted by the very industries they are supposed to be supervising.
The practical policy is to impose structural limits on what activities banks can participate in and how big they can get. Just look at the list of high-profile supporters: former Federal Reserve Chairman Paul Volcker, former Citigroup Chairman John Reed, Bank of England Governor Mervyn King. I don't remember seeing any of those guys at the Iraq War protests.
Many of the regulatory blind spots that brought down the economy were obvious to some policymakers for years. Back in 1994, Sen. Byron Dorgan (D-ND) wrote an article for The Washington Monthly warning that derivatives trading was putting the economy in grave danger. Commodities Futures Trading Commission Chair Brooksley Born tried to take action on these derivatives, but was overruled by other regulators, including then-Fed Chair Alan Greenspan, and then-Treasury Secretary Lawrence Summers, now the top economic adviser to President Obama. Summers and Greenspan even convinced Congress to pass a law banning the regulation of key derivatives, including credit default swaps, which ultimately brought down insurance giant AIG.
Fifteen years after Dorgan's article first ran, The Washington Monthly is featuring it again, along with a recent speech by Dorgan that details massive failures in Wall Street and Washington.
"We had regulators come to town in recent years and willfully boasted that they wanted to be blind as regulators," Dorgan says.
There are good elements of Obama's plan to deal with too-big-to-fail. It gives policymakers the option of putting a too-big-to-fail institution through a special bankruptcy process administered by the executive branch, thus avoiding the problems created in bankruptcy court when Lehman Brothers failed. But the bad part is really bad: Officials would also have the option to provide unlimited bailouts to Big Finance via loans, guarantees and even asset purchases.
As Mike Lillis notes for The Washington Independent, some responsible Democrats like Rep. Brad Sherman (D-CA) have been objecting to this aspect of the legislation for months. Sherman, in fact, calls it "TARP on steroids," noting that the bank bailout at least came with some meager oversight and a limit on the program's actual size.
The bank lobby is spending money like mad to maintain their stranglehold on the economy. Neither Congress or the administration will change course without intense public pressure. So it was very reassuring last week to see thousands of people protesting the annual meeting of top bank lobby group, the American Bankers Association. David Moberg chronicles the protest in a blog post for Working In These Times that covers speeches by both key union leaders and ordinary people facing foreclosure after watching their tax dollars go to the very bankers who wrecked the economy.
"There was broad agreement on anger at the banks for providing so little, if any, public benefit for the massive bail-out, and for so quickly returning to the greed and abuse that precipitated the crisis," Moberg writes.
Laura Flanders covers the protests for GRITtv, including video of protesters chanting "Bust up big banks!" In a roundtable discussion with Christina Clausen of the United Food & Commercial Workers Union, George Goehl of National People's Action and Rob Robertson of the Right To The City Alliance, Rolling Stone journalist Matt Taibbi explains the overriding impotence of the regulations Congress is about to approve. Regulators will not be able to crack down on abusive derivatives, a full 8,000 of 8,200 banks will be exempt from Consumer Financial Protection Agency oversight, while the same agencies that screwed up heading into this crisis will be charged with preventing the next one.
"They've had sweeping powers to do whatever they wanted," Taibbi says. "They've had this regulatory power all along."
What we need are good jobs, and lots of them. Obama's economic stimulus package has made tangible economic progress. It's saved hundreds of thousands of jobs, and is clearly responsible for the turnaround in gross domestic product (GDP) we saw in the third quarter. But a full 17% of the workforce remains unable to find full-time work, as Julianne Malveux explains for The Progressive.
When Wall Street crashed in 1929 and unleashed the Great Depression, the government eventually stepped in as an employer-of-last-resort. The Works Progress Administration (WPA) and Civilian Conservation Corps (CCC). built schools, parks, roads and bridges which still serve our communities today. Both the WPA and the CCC employed literally millions of people-in the 1930s. It's a model that could work very well today.
As the current recession makes clear, ending too-big-to-fail and guaranteeing a good job for everyone in our society who wants one are the two most critical structural reforms our economy needs. Don't let lawmakers forget it.
This post features links to the best independent, progressive reporting about the economy by members of The Media Consortium. It is free to reprint. Visit the Audit for a complete list of articles on economic issues, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Mulch, The Pulse and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
The U.S. economy has diverged: Wall Street is living high on the hog, while everyone else is struggling. The Dow Jones Industrial Average eclipsed 10,000 for the first time since last October this week, even as unemployment continues to spiral out of control. And while President Barack Obama has taken some very real steps to help ordinary people, his administration's efforts to save Wall Street have far outstripped their support of workers.
Matthew Rothschild details these disparities for The Progressive. Regulatory reforms are moving through Congress at a snail's pace and the wreckage from the mortgage bubble is increasing. Wage cuts are more widespread today than in any era since the Great Depression, even as bankers capitalize on taxpayer bailouts to score epic profits and outsized bonuses.
"One economy is for the rich and the upper middle class," Rothschild writes. "The other economy is for everybody else."
So how can a few big banks make so much money while the rest of the economy suffers? As Kevin Drum explains for Mother Jones, the kind of banking that helps the economy is a pretty simple business of taking deposits and making loans. But a lot of what we now call "banking" really just consists of making bets on just about anything you can dream up.
"Banks aren't using all this cheap money to increase lending. They're using it to fund bigger and bigger bets in the fixed-income sector - the same sector that brought us junk bonds, credit default swaps, subprime loan securitization, interest rate carries, collateralized debt obligations, and all the rest of Warren Buffett's 'financial weapons of mass destruction.'"
The banks, in other words, are gambling with taxpayer money. A host of big finance companies have reported earnings in the past week, and the numbers are ugly: JPMorgan Chase reaped $3.59 billion in third-quarter profits and Goldman Sachs is planning to payout $23 billion in bonuses from speculative trading, while Bank of America and Citigroup are hemorraging money on mortgages and credit cards. The Wall Street casino is alive and well, but anything that is actually tied to the real economy is a disaster.
According to a new report from the U.S. Treasury, lending among the largest recipients of the Troubled Asset Relief Program fell by 17% from July to August. Small businesses can't cope with the cutoff in financing. A lot of businesses stay profitable over the long-term by borrowing money to meet short-term expenses. A baker can borrow money to buy flour and pay the bank back when she sells her bread. With bank lending on ice and consumers cutting back on spending, many small businesses are failing. Thousands more will be at risk in the next couple of years while unemployment remains elevated.
Writing for Salon, former Clinton Secretary of Labor Robert Reich notes that these economic struggles are not reflected in major stock indices. Stock are soaring as big corporations who don't need bank loans score short-term profits from cost-cutting, i.e., mass layoffs. Obviously, this strategy can't work for very long. When millions of Americans are out of work, they can't afford to buy the things companies make.
There's an important lesson in our current economic state-of-affairs, as Katrina vanden Heuvel emphasizes for The Nation. The bailout has not done what Henry Paulson told us it would do. To be sure, it saved the banks-- even the strongest banks would have failed last fall without extraordinary government support. But it has not increased lending and kept the economy from disaster. The Obama administration, which has extended the Bush administration's support for bank balance sheets and bonus checks, is facing a political nightmare if it doesn't show produce some stronger economic results for ordinary citizens.
"Heading into 2010, the Obama administration must put itself back on the side of working people," vanden Heuvel writes.
The administration must address two critical problems in order to restore the nation's economic credibility. Putting the unemployed back to work is at the top of the list. Anything that saves jobs will help, including aid to states to keep teachers and cops on government payrolls and tax credits for companies that hire new full-time workers.
Something must also be done about the foreclosure epidemic. Nothing underscores our economic disparity like continuing housing mess, which has been in full-blown crisis mode since 2006. Despite a multi-trillion-dollar bank bailout, foreclosures are surging to all-time highs. Writing for The American Prospect, Tim Fernholz details the prolonged problems with the Obama administration's current foreclosure relief program.
While millions of troubled borrowers are eligible for the plan, which reduces monthly mortgage payments to affordable levels, foreclosures are still outpacing loan relief efforts by more than two-to-one.
Banks are dragging their feet and the administration has imposed no penalties on lenders who don't live up to the program's standards. Instead, the Treasury Department is offering banks cash incentives to keep people in their homes. Bank of America, which has received $45 billion in direct government bailout funds, plus hundreds of billions in government guarantees and other perks, has modified merely 11% of the mortgages it controls that are eligible for the plan.
Fernholz offers several potential improvements to Obama's foreclosure relief plan, including more aggressive government policing of the current plan and allowing foreclosed homeowners to continue to live in their homes as renters. With up to 12 million foreclosures projected by the end of 2012, just about anything the administration does will help.
The economy is a measure of social well-being, not a stock market index or a corporate earnings statement. Policymakers need to prove they can respond to the very real needs of all their citizens, not just those with financial clout.
This post features links to the best independent, progressive reporting about the economy by members of The Media Consortium. It is free to reprint. Visit the Audit for a complete list of articles on economic issues, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Mulch, The Pulse and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
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