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Campaign Fundraising is Bribery

Monday, April 14th, 2014

Selling influence is what our legislators do, legally, all the time

The bribery allegations against California state Sen. Leland Yee expose the folly of the U.S. Supreme Court’s logic in its April 2 decision in McCutcheon v. FEC, which struck down restrictions on the amount of money individuals may donate to federal campaigns in an election cycle.

The only legitimate reason to set limits on funding politicians’ campaigns, according to the court’s majority opinion, authored by Chief Justice John Roberts, is explicit trades of campaign dollars for action — quid pro quo corruption. The court pointedly dismissed “the possibility that an individual who spends large sums may garner ‘influence over or access to’ elected officials” as a reason to limit campaign donations.

The way our broken political system works, though, is that the chief place to raise money for campaigns is from industries and interest groups that want something from government. Influence is purchased all the time, whether in explicit quid pro quo trades or not, and such influence peddling just as bad for democracy as bribery. The real scandal in Sacramento and Washington, D.C., is not the occasional lawbreaking; it’s what’s legal.

According to the indictment, Yee allegedly received $10,000 from a campaign contributor and then wrote a letter in support of that contributor’s software firm. In addition, Yee allegedly made this trade on tape with an undercover FBI agent. (He has also been indicted for gun trafficking, which is not relevant to this discussion.) But imagine you’re state Sen. Jane Doe and you accept a $10,000 campaign contribution at a fundraiser and then a week later that contributor says to you, “By the way, my company could really use a letter of support, if you feel like it.” You say, “I’ll see what I can do,” and then you write the letter. Your behavior would be perfectly legal.

What’s the difference? For Yee, who was allegedly indiscreet enough to make such a deal explicit and to be caught on tape by the FBI, plenty. But for the rest of us citizens who must live under the distorted decisions of politicians continually focused on raising the campaign funds they need for re-election, it is a distinction without a difference.

Reading the FBI complaint against Yee on this bribery allegation, I was struck by how his discussions with the undercover FBI agent disguised as a campaign contributor were so similar to other lawmakers’ routine campaign fundraising. The usual fundraising and lawmaking that goes on in Sacramento and Washington is legalized bribery.

It costs $1 million, on average, to win a state senate campaign. That means raising about $10,000 a week for two years. How can any candidate raise that much money?

Simple: There’s an unlimited supply of campaign funds available from the people, companies and interests that want something from government. That’s where Yee’s money — and most of the money for political campaigns — comes from.

MapLight, the nonprofit I head that studies money in politics, researched campaign contributions to Yee, going back several years. Some of the people mentioned in the indictment have given him campaign contributions. But overall, his campaign contribution pattern is similar to many other California Democratic legislators’. For example, unions are among his top contributors; he received money from Time Warner and other companies too.

It doesn’t have to be this way. In Arizona and a half-dozen other states, laws creating public funding of elections let candidates run for office and win without dependence on big campaign donors. Former Arizona Gov. Janet Napolitano was the first governor in U.S. history elected without private money. She quickly created a prescription-drug discount program for Arizona citizens and said that she couldn’t have done this if she had taken pharmaceutical firm campaign money.

The Yee affair is the third scandal to hit California’s state legislature in the past six months. These stories further erode the trust people have placed in our political institutions and the well-meaning public servants who have become tainted by these scandals. Lawmakers in Sacramento and Washington understandably don’t want the public to distrust them all equally.

But dismissing the accused as just a few bad apples hardly does justice to the situation. It’s our broken money-based political system that elects legislators who are forced to spend most of their time on transactions with special interests for campaign donations rather than on legislating for the common good. The system forces politicians to compete for money and attracts lawmakers who are good at trading money for influence. Instead of electing the best leaders, we elect the best fundraisers.

If lawmakers from Sacramento to Capitol Hill want to change the public’s perception of them, they must stand up and say, “We are going to reform the system that makes people dependent upon relentless fundraising to get elected.” Legalized bribery is bribery all the same.

– Daniel G. Newman is President and Co-Founder of MapLight, a nonpartisan nonprofit revealing money’s influence on politics.

– To the original article… ➡

 

Posted in Capitalism & Corporations, Corporate takeover of Government, Corruption, Culture - How not to do it, Human Rights, Politics - The Wrong Way, The Perfect Storm, Wealth Disparity | No Comments »

The Ascendancy of the Oligarchy

Monday, April 7th, 2014

(NATIONAL) — If wealth and income weren’t already so concentrated in the hands of a few, the shameful “McCutcheon” decision by the five Republican appointees to the Supreme Court wouldn’t be as dangerous.

But by taking “Citizen’s United” one step further and effectively eviscerating campaign finance laws, the Court has issued an invitation to oligarchy.

Almost limitless political donations coupled with America’s dramatically widening inequality create a vicious cycle in which the wealthy buy votes that lower their taxes, give them bailouts and subsidies, and deregulate their businesses – thereby making them even wealthier and capable of buying even more votes.

Corruption breeds more corruption.

That the richest four hundred Americans now have more wealth than the poorest 150 million Americans put together, the wealthiest 1 percent own over 35 percent of the nation’s private assets, and 95 percent of all the economic gains since the start of the recovery in 2009 have gone to the top 1 percent — all of this is cause for worry, and not just because it means the middle class lacks the purchasing power necessary to get the economy out of first gear.

It is also worrisome because such great concentrations of wealth so readily compound themselves through politics, rigging the game in their favor and against everyone else.

“McCutcheon” merely accelerates this vicious cycle.

As Thomas Piketty shows in his monumental “Capital in the Twenty-First Century,” this was the pattern in advanced economies through much of the 17th, 18th, and 19th centuries.

And it is coming to be the pattern once again.

Picketty is pessimistic that much can be done to reverse it (his sweeping economic data suggest that slow growth will almost automatically concentrate great wealth in a relatively few hands).

But he disregards the political upheavals and reforms that such wealth concentrations often inspire — such as America’s populist revolts of the 1890s followed by the progressive era, or the German socialist movement in the 1870s followed by Otto von Bismarck’s creation of the first welfare state.

In America of the late nineteenth century, the lackeys of robber barons literally deposited sacks of money on the desks of pliant legislators, prompting the great jurist Louis Brandeis to note that the nation had a choice:

“We can have a democracy or we can have great wealth in the hands of a few,” he said. “But we cannot have both.”

Soon thereafter America made the choice.

Public outrage gave birth to the nation’s first campaign finance laws, along with the first progressive income tax.

The trusts were broken up and regulations imposed to bar impure food and drugs. Several states enacted America’s first labor protections, including the 40-hour workweek.

The question is when do we reach another tipping point, and what happens then?

ROBERT B. REICH, currently Chancellor’s Professor of Public Policy at the University of California at Berkeley, was Secretary of Labor in the Clinton administration. Time Magazine named him one of the ten most effective cabinet secretaries of the last century.

He has written thirteen books, including the best sellers “Aftershock” and “The Work of Nations.” His latest, “Beyond Outrage,” is now out in paperback. He is also a founding editor of the American Prospect magazine and chairman of Common Cause. This article originally appeared at RobertReich.org

To the source… ➡

Posted in Capitalism & Corporations, Corporate takeover of Government, CrashBlogging, Human Rights, Politics - The Wrong Way, The Perfect Storm, Wealth Disparity | No Comments »

The withering away of America

Wednesday, March 26th, 2014

The other day, I read a story about a Hedge Fund buying up foreclosed homes in Atlanta, Georgia.   They bought up 4000 such homes on a single day and the story said they are buying more all the time.

Their plan, according to the article, is to hang onto these homes until the price of the houses rise and then they will sell them for a nice profit.  In the mean time, they will rent them.

Apparently, these folks have a lot of money so they can afford to buy these houses up at distressed prices and then be patient until the market turns.

This is one of those stories where you could say these folks are pretty smart.   Or not.

On a smaller scale, many of us, if we had a few extra dollars in the bank and if we saw a reasonable house come up on a foreclosure sale, we might just jump on that opportunity.  We would fix it up a bit, rent it out and wait for its property value to go up and then, at some point in the future, perhaps at retirement time, we’d sell it for a tidy profit.  And it would be all to the good.

Indeed, many of you who are doing fairly well with your finances probably already own one or more extra properties as investments that you are renting out just as the hedge fund folks are.

This is the American way, is it not?  We get ahead by working hard, saving our money and by investing it well.

Some of you, as you are reading this now, are waiting for the “gotcha” fish hook to emerge out of this little story of mine, aren’t you?

Well, sorry, it’s not going to happen.  At least not for all of those Mom and Pop investors among you.  I am decidedly on your side in all of this.  The hard working and smart saving American work ethic is one I embrace.

But, if we go back to the opening of this story and think about those Hedge Fund folks buying up thousands of foreclosed homes, I’ve got some problems there.

More is not always better

This Hedge Fund is buying up thousands and thousands of homes and taking them off the real estate market.

That means less homes are available for those people that want to buy.  And that also means that the prices of the homes that are available for sale will rise given the inexorable logic of supply and demand.

Buyers on the lower end of the economic scale will not be able to buy in this situation and they will be forced into renting.

All of us know that renting, while done by many, is surely not the best way to spend your money.  All you get is a roof over your head and as soon as you stop paying rent, the roof goes away and you have nothing.  The best thing you can do as a renter, is to save money as quickly as possible so you can buy a place of your own and start building some equity.

Stacking the deck

So, here we have a case where a very large entity, the Hedge Fund, is driving the market in a way that highly favors them and disadvantages the smaller folks.

From the Hedge Fund’s POV, as they take more houses off the real estate market and put them away into their investment portfolio, they are causing the prices on the remaining houses to rise. As the prices of the remaining houses rise, less people can afford them and more are driven into the rental market.

And look who is there waiting?   Its the Hedge Fund which has lots of houses to rent. Sweet, eh?   It’s not unlike driving sheep into a pen.

Its sweet on all sides for the Hedge Fund beacuse as more folks compete for the available rentals, the price of rents will rise as well.

The Hedge Fund will always do well with this strategy so long as they pick their locations well.

All they have to know to win is that in desirable areas, the population inexorably rises because people want to live there for the environment and/or the work opportunities.  And in such areas, more people means more homes are needed.

The bottom line here is that the Hedge Fund is using its enormous financial clout in a way that benefits them but not necessarily the rest of us.

Now, small folks with some accumulated savings can invest it by buying one or two extra homes and renting them out as we mentioned earlier and that’s just what the Hedge Fund is doing, isn’t it?   Except they are doing it on a vastly huger scale.

And it is precisely this difference between the huge Hedge Funds of the world and the small folks like us which is the point of what this article is about.

The story of bigger and bigger

A small fellow starts a Mom and Pop business in his home town and it goes well.   The local people like what he’s doing and they buy what he’s got.

He’s smart.  He saves his profits and he opens a second shop across town.  He employees more folks in the second shop. The situation is a winner all around.

He opens more shops all up and down the area of the state he lives in.  More people are employed by him.  He gives money to charities and he support the local Boy Scouts and the YMCA.   The story is getting better and better.

At some point, he shifts from being a family owned business to being a corporation because that structure provides better protect for his family by separating their corporate assets from their family assets.  And perhaps it works better for their taxes as well.

Soon, as things continue to grow, the owner opens subsidiaries or franchises and moves into other states.

And for this business and these people, things just continue to go from strength to strength.

Now, the owner knows State Representatives and State Senators on a first-name basis.   He’s invited to sit on various boards for the YMCA and the local hospital.

At some point, his privately owned corporation may go public.  And, if the public offering is successful, he and his family will make a large amount of money and the corporation will get a large influx of cash to fund its further growth.

Now, as a publicly held corporation, it has a board and stock holders and it becomes responsible to more than just the former owner and his family.  Now, it becomes responsible to its stockholders who expect it to make a good return on their investment in the company.

This is all the stuff of magic.   The stuff that every small business owner hopes will happen to his or her business.  It is, literally, the stuff of the American Dream.

Ever onward and upward

The newly minted public corporation continues its growth.  And with the wisdom now of its board of directors and of its corporate officers, (either of which may or may not include the former owner) the corporation becomes a real competitor in the market segment it competes in.

Somewhere along this spectacular rise, it expands out across the nation from its original state and soon it is eying international markets and establishing overseas subsidiaries. And, if the run of success last long enough, it will become an international success.  It will become a global player.

Every national and global corporation you’ve ever heard of has followed this trajectory, unless it was spun off from earlier corporations.  If you trace their roots back far enough, every corporation, or its antecedents, will have begun with one person, one family or a small group’s dream that they too could build something out of their hard work and creativity.  It is a hugely commendable thing to build something like this out of nothing.

But can there be too much of a good thing?

Can there be too much competitiveness?  Too much success?  Too much market dominance?

Yes, there can be, Dorothy.  Absolutely.   Just because bigger seems better here in Kansas, or anywhere else, doesn’t mean it’s always the case.

Businesses can get so big that they becomes monopolies and bullies in their markets And when their competitiveness becomes market dominance, then serious systemic problems can develop.   And those problems mostly affect the small folks.

Remember the U.S. breakup Standard Oil in 1911? Or the U.S. breakup of Ma Bell in 1982?

In both of these cases, the growth of the organizations had led to so much market power that they were in the position to virtually set any price they wanted for their goods. They had grown so strong that they had very little competition left.

So, what limits run away corporate power?

What has always limited corporate power, up until recent times, has been government power.
That was what did it with Standard Oil and Ma Bell.

Now, by many people’s definition, government is suppose to exist to look out for the people’s common good.  See if you recognize this quote:

“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.–That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed….”

The founding fathers of the United States specifically said, “That to secure these rights, Governments are instituted among men….”.

When corporations are small, they are of a net benefit to all of us because of the the products and services they create and provide for us.   But, when they get too large, this net benefit can become a net liability.  And, when things get too far out of whack, corporations need to be controlled and regulated by the government for the common good.

And that’s the way it has worked with our government and corporations in the past.  But things are changing, Dorothy.

To show you how things are changing, let me digress and tell you a short story about the environmentalist movement in the U.S. during the 1960s.

Bear with me, please, even if you are not an environmentalist.  My story is relevant to the overall point of this article which is actually about the corrosive influence of mega corporations and big money on the American Democracy.

In the 1960’s there were numerous movements afoot to get laws passed that would protect the quality of our air and our water. These proposed laws were wending their way slowly through the legislative process at the national level and the corporate world was half attending to all of this but it is probably safe to say they weren’t too deeply worried about it.

Then some things happened that changed the game. There were reports about the utterly disgraceful state of some of the east coast’s rivers.  The Cuyahoga River in particular caught fire in Cleveland.  And the Interior Department was proposing to flood the Grand Canyon.  And then there was the infamous Santa Barbara Oil Spill that occurred in 1969.

Almost overnight the environmental movement, which had been simmering, was galvanized by these events to do something now.   And the bills in the legislature involving clean air and clean water were well positioned to benefit from the public’s new found passion for environmental protection.

As a result, these bills were passed decisively in a strong and undiluted form and became the new laws of the land.

The corporate world had been caught flat-footed by these rapidly moving events.  Things had moved too quickly for them and suddenly there were powerful new laws that put serious limitations on what corporations could and couldn’t do with their waste.

And they couldn’t complain too openly about all of this because, after all, the new laws had widespread public support.  The corporations couldn’t be seen in that political environment as opposing laws that protected the public commons from those who would abuse the air and the water for their own profits.

And about the same time that big business was realizing their vulnerability to such laws, the environmentalists were realizing that passing good environmental laws that just applied to the U.S. wouldn’t be sufficient, if the rest of the world just continued on as before. So, most of the people who were big players in the U.S. environmental movement shifted their efforts from being U.S. centric to being globally focused.

But never again

But, the business world is anything but stupid.   They had learned their lesson the hard way and they resolved to never again be caught sleeping nationally or internationally.

And, indeed, they’ve kept this promise to themselves.   Since those fateful days in the 1960’s and 70’s, when the Clean Air and Clean Water acts were passed, very little else of environmental significance has been signed into law within the U.S. or internationally because of effective and well focused resistance from the world business communities.

The only notable exception to this trend would be the Montreal Accord, which was ratified in 1989.  This international accord limits the production and use of Chlorofluorocarbons (CFC) which were decisively shown by scientists to be the smoking gun that was destroying the world’s Ozone Layer.

For those who might be interested in this type of history, I learned a lot of this from reading the books of James Gustave Speth, Dean of the Yale School of Forestry and Environmental Studies.  Speth is, and has been, one of the foremost actors in the U.S. and International environmental movements for many decades now.

The two books of his which I’ve read are, Red Sky at Morning – America and the Crisis of the Global Environment (2004) and The Bridge at the Edge of the World – Capitalism, the Environment, and Crossing from Crisis  to Sustainability (2008).

But now back to the main plot line

So, here’s how the story continues to unfold after the seminal events of the 60’s and 70’s:

The large corporations, whose bottom line’s were impacted by the new environmental laws, learned their lesson.   Now they could not just dump their industrial wastes into the rivers nor put just anything they wanted to up their smokestacks.  And those changes to what they could and could not do were going to cost them money and lower their profits.

Stung badly once, the corporate world began to pay attention to the environmental laws that were wending their ways through the world’s legislatures on their way to possibly becoming laws. And now, the corporate world began to put on the quiet full-court press to dilute or defeat such laws preemptively to protect their bottom lines.

These battles have mostly been fought in the smokey back rooms of the political world but sometimes they have erupted into public view.

Who doesn’t remember the Tobacco Industry executives testifying in front of Congress in 1994 on TV, no less, that smoking cigarettes was not harmful to public health?

They were prepared to, and they did, lie and say anything they could to deflect congress and the people’s will from diminishing their profits.  The Tobacco Industry spent an enormous amount of money on dis-information campaigns trying to deflect the law makers. But eventually Congress, with the input of scientific data on the effects of smoking, saw through their smoke screen and national laws were passed to lessen the dangers of smoking to the American public.

But the corporations have won many of these battles as well.

For instance, have you ever wondered why we cannot read on the  labels of the food we buy exactly what is in it and where it came from?

I could cite many examples where the corporate world has prevented the passage of laws to protect their own bottom line profits.

For a long time now, corporations have fought via their lobbyists in our legislatures to defeat or to water down bills that will impact their bottom line profits.

And regardless of the PR and the advertisements they put out which attempt to make them all look like our cuddly responsible corporate friends, these mega corporations and extremely high net-worth individuals, like the Koch brothers, are simply all about profits with little or no concern for the public good.

We’ve drifted from what the founding fathers envisioned

Do you remember the idea of one-man-one-vote that we all learned about in school?

We are not all equal voters.  It is obvious that mega corporations or very high net worth people with big money behind them can inordinately influence which laws are passed and which are not through lobbying.

Some of you will say, “Well, it’s always been that way in politics.”    And, probably, you are right.

But I’m not happy about it.  Maybe I was corrupted by watching Jimmy Stewart in the 1939 movie ‘Mr. Smith Goes to Washington‘ too many times.

So, here we have the picture then of why the corporate world exerts so much of its financial muscle on lobbying in our nation’s capital.   And the ugly truth is that it is to protect their own profits.  And all of that power, which is being exerted to shape the nation’s laws, have little or nothing to do with the common good as the fathers of our nation intended it.

Ah, but don’t despair – it gets worse

It gets worse? Yes, it does. This battle between the various forces in our society for who gets to make the laws is an ongoing thing. And like any ongoing battle, the strategies and the rules change as new opportunities are realized.

At some point, the large corporations and the mega high net-worth individuals realized that they could better influence which laws get made and which don’t not by lobbying – but by influencing who gets elected to make the laws in the first place.   Why hack at the branches if you can go for the roots, eh?

So big money has begun to pour huge sums into getting folks elected who will be sympathetic to the needs of business – rather than to the needs of the people.   And lets be clear, again, about what those ‘needs’ are.

The needs of business are to have their way cleared of ‘unnecessary’ laws so they can increase their profits.

This process of gaming the system in American politics with big money has gotten quite advanced.  And amazingly, most of the American public hasn’t noticed.

Big business isn’t stupid by any means. They know that they can still have their gains rolled back at the ballot box if people were to get aware of and upset about what’s going on.

So, you won’t see them promoting their side of this battle by saying things like, “The rich have every right to get richer regardless of the consequence to ordinary citizens.”

Instead, they push themes like, “We need less government regulation and interference.  Such interference prevents small hard working Mom and Pop entrepreneurs all over this great country from reaching their full potential.”

They purposely, and cynically, associate themselves with the small and medium size business community and make it seem like these folks and big business have common cause.

And there’s just enough truth in what they say sometimes to make it plausible.

But the cynicism of why they are doing it is breathtaking. They don’t give a rat’s behind about the small and medium Mom and Pop folks other than to use them as a foil to distract the public’s attention from their devious gaming of the American political system.

Back near the beginning of this piece, I made a point to say that I applaud the Mom and Pop small and medium sized entrepreneurs of America.  And I meant it. The are the engines of creation in this country. They make the country better.

But, the really big corporations, those whose sole motivation is to maximize their profits and minimize their costs, and the really high net worth individuals who never think they’ll have enough money, these folks are of a different breed altogether.

The signs that they are making inroads into controlling our legislative processes for their own benefit are all around us.   But, these signs are largely hidden by the immense PR smoke screens they are putting up to confuse the public.

In this context, the ‘Citizens United‘ decision by the Supreme Court a few years ago to grant corporations the same rights as people was huge.

So, what is a corporation anyway?

I’ll tell you this – they are not our neighborhood fuzzy responsible community friends.

Consider that a large corporation is an entity that exists solely to maximize the investment returns of its stockholders. This is a simple cold hard fact. They have only one motivation and that is profit maximization.

They have zero motivation to consider what’s good for the nation or for the public unless the issue begins to interfere with their profits.

And, if some public concern does begin to impact their profits, they’ll make superficial changes and unleash a storm of PR designed to make us think that they are on our side and they have our best interests in mind and they are part of our community and they share our values and etc. and etc. We’ve seen it all. But few of us have recognized how deeply cynical it all is.

If this was a real person who had such a single minded focus, most of us would think they were a dangerous unfeeling psychopath walking among us.

But now, according to the Supreme Court, these entities can move among us with the same rights as sovereign citizens.

And the limits of how much they can donate to political campaigns have largely been lifted.

So, what causes do you think that these newly minted mega corporate ‘citizens’ donate money to?   The only ones they care about, of course. And that’s getting folks elected who will not pass laws that will interfere with their right to maximize their profits.

Their audacity knows no limits

This corporate philosophy, of not hacking at the branches if you can go for the roots, is expanding in a frightening manner internationally now.

There’s something called the TPPA, the Trans Pacific Partnership Agreement.   It has been under negotiation since 2005 and currently 11 nations from around the Pacific Rim are involved.

The stated purpose of the TPPA is:

… to enhance trade and investment among the TPP partner countries, promote innovation, economic growth and development, and support the creation and retention of jobs.

Whooo-ee.  That sounds good, doesn’t it?

Folks in most of the countries involved in these negotiations have no idea these negotiations are even going on, much less the details of what’s actually being negotiated.

You see, the negotiations are being carried out in secret.  In many cases, they are being kept secret from even from the legislators of the countries negotiating.  Specially appointed government trade negotiators are conducting these negotiations and these folks are appointed people – not elected people.

It gets even more incredible.

In the U.S., which is the most dominate of the countries involved, the vast majority of the House and Senate membership are blocked from knowing the details of what’s being negotiated while representatives from a number of large U.S. corporations are allowed to sit in on the negotiations – as they occur.

Yes, you heard that right. Our elected representative are locked out and the mega corporations are sitting in as advisors to the negotiators.

Why the h*** would that be, you say?

Well, from the few documents that have been leaked from these secret negotiations, it turns out to be evident that only about 30% of these agreements actually have anything to do with free trade.  While the majority of what’s being negotiated has to do with protecting corporate rights and profits!

I know, many of you at this point in this story think that I must have drunk the bad kool-aid on this one right?

Well, you’d be wrong.  This is no straw man.

There’s ample documentation of what’s going on out there and of what’s intended to happen, if the corporations get their way.

Proof?

Here’s a statement by Ron Wyden, a U.S. Senator from Oregon expressing his deep frustration as how little, as a U.S. Senator, he’s been able to find out about what’s being negotiated.

In a floor statement to Congress Wyden said, “The majority of Congress is being kept in the dark as to the substance of the TPP negotiations, while representatives of US corporations — like Halliburton, Chevron, Comcast and the Motion Picture Association of America — are being consulted and made privy to details of the agreement.”

And here’s a recent article that appeared in the New York Times by Joseph E. Stiglitz, a U.S. Nobel Prize winning economist, about what he thinks the TPPA is really about and what’s wrong with it. I encourage you to read this.

http://opinionator.blogs.nytimes.com/2014/03/15/on-the-wrong-side-of-globalization/

This is huge, my friends.  Just Google the TPPA and you will find a ton of commentary on the Internet about it.   And then you might also reflect on why you never hear about this sort of thing on your evening news?

Just a bit more on the TPPA and then I’m going to wrap this up.

One of the worst aspects of what’s being proposed in the TPPA is that corporations will be able to sue sovereign nations – if those nations pass laws that diminish the profits of the corporations.

Yes, you heard that right.

Imagine that a country passes laws mandating that cigarette packs sold in that country have to have plain labeling and carry pictures of what happens to folk’s lungs when they smoke. Such a law would be passed for the good of the people, yes?

Or, perhaps they pass a law that no mining will be allowed in their national parks.  Again, this is a law passed for the good of the people of that country.

But, of course, the profits of the cigarette manufacturers and those of the mining companies would be decreased.

Under trade agreement law, as it would stand post-TPPA, the corporations involved could sue the countries that passed such laws to recover their lost profits.   And these law suits would be not be held in the courts of the countries involved but rather they would be decided by a three man international tribunal which would not be beholding to any country.

Hard to believe, isn’t it?  And all of that is going on around you in secret.   In secret even from your legislators.

When I tell folks that the large multi-national corporate world is infiltrating and taking over the sovereign functions of national governments as their latest strategy to increase their profits, some people look at me like I’m a nut case.

Make up your own mind

Pay attention to the news, now that you are aware of all of this.   Keeping watching and see what you think.

Ask yourself if mega corporations, solely obsessed with profits and utterly indifferent to the welfare of the people or of the nation, should be considered to be people and allowed to walk around unchecked in polite society?

Ask yourself, if a corporation is suppose to be a person, if you’d actually associate with a real person that had such nasty and mercenary personal attributes?

Or even more to the point, given how things are going, ask yourself what you think about living in a country where the “Government of the people, by the people, for the people, shall not perish from the Earth” is, in sad fact, withering away before our very eyes and being taken over by mega corporations and the very greedy.

These are not idle questions in the world today, my friends.

-dennis

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The Net Closes Around Us

Wednesday, March 26th, 2014

– An intense article, below, about how very much of our digital data is being sucked up and analyzed for all sorts of reasons and we do, and will, have very little to say about it.   

– It’s the digital future – read it and weep.  Some quotes:

“In November, the British tech blogger Doctorbeet discovered that his new LG Smart TV was snooping on him. Every time he changed the channel, his activity was logged and transmitted unencrypted to LG. Doctorbeet checked the TV’s option screen and found that the setting “collection of watching info” was turned on by default. Being a techie, he turned it off, but it didn’t matter. The information continued to flow to the company anyway.”

the Drug Enforcement Administration already subpoenas utility company records to determine if electricity consumption in specific homes is consistent with a marijuana-growing operation. What will come next? Will eating habits collected by smart fridges be repackaged and sold to healthcare or insurance companies as predictors of obesity or other health problems — and so a reasonable basis for determining premiums? Will smart lights inform drug companies of insomniac owners?”

“When everything is increasingly tracked and viewed through the lens of technological omniscience, what will the effect be on dissent and protest? Will security companies with risk assessment software troll through our data and crunch it to identify people they believe have the propensity to become criminals or troublemakers — and then share that with law enforcement? (Something like it already seems to be happening in Chicago, where police are using computer analytic programs to identify people at a greater risk of violent behavior.)”

– dennis

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Twice in my life — in the 1960s and the post-9/11 years — I was suddenly aware of clicks and other strange noises on my phone.  In both periods, I’ve wondered what the story was, and then made self-conscious jokes with whoever was on the other end of the line about those who might (or might not) be listening in.  Twice in my life I’ve felt, up close and personal, that ominous, uncomfortable, twitchy sense of being overheard, without ever knowing if it was a manifestation of the paranoia of the times or of realism — or perhaps of both.

I’m conceptually outraged by mass surveillance, but generally my personal attitude has always been: Go ahead.  Read my email, listen to my phone calls, follow my web searches, check out my location via my cell phone.  My tweets don’t exist — but if they did, I’d say have at ‘em.  I don’t give a damn.

And in some sense, I don’t, even though everyone, including me, is embarrassed by something.  Everyone says something about someone they would rather not have made public (or perhaps have even said).  Everyone has some thing — or sometimes many things — they would rather keep to themselves.

Increasingly, however, as the U.S. surveillance state grows ever more pervasive, domestically and globally, as the corporate version of the same expands exponentially, as prying “eyes” and “ears” of every technological variety proliferate, the question of who exactly we are arises.  What are we without privacy, without a certain kind of unknowability?  What are we when “our” information is potentially anyone’s information?  We may soon find out.  Arecent experiment by two Stanford University graduate students who gathered just a few month’s worth of phone metadata on 546 volunteers has, for instance, made mincemeat of President Obama’s claim that the NSA’s massive version of metadata collection “is not looking at people’s names and they’re not looking at content.”  Using only the phone metadata they got, the Stanford researchers “inferred sensitive information about people’s lives, including: neurological and heart conditions, gun ownership, marijuana cultivation, abortion, and participation in Alcoholics Anonymous.”

And that’s just a crude version of what the future holds for all of us.  There are various kinds of extinctions.  That superb environmental reporter Elizabeth Kolbert has just written a powerful book, The Sixth Extinction, about the more usual (if horrifying) kind.  Our developing surveillance world may offer us an example of another kind of extinction: of what we once knew as the private self.  If you want to be chilled to the bone when it comes to this, check out today’s stunning report by the ACLU’s Catherine Crump and Matthew Harwood on where the corporate world is taking your identity. Tom

Invasion of the Data Snatchers
Big Data and the Internet of Things Means the Surveillance of Everything
By Catherine Crump and Matthew Harwood

Estimates vary, but by 2020 there could be over 30 billion devices connected to the Internet. Once dumb, they will have smartened up thanks to sensors and other technologies embedded in them and, thanks to your machines, your life will quite literally have gone online.

The implications are revolutionary. Your smart refrigerator will keep an inventory of food items, noting when they go bad. Your smart thermostat will learn your habits and adjust the temperature to your liking. Smart lights will illuminate dangerous parking garages, even as they keep an “eye” out for suspicious activity.

Techno-evangelists have a nice catchphrase for this future utopia of machines and the never-ending stream of information, known as Big Data, it produces: the Internet of Things.  So abstract. So inoffensive. Ultimately, so meaningless.

A future Internet of Things does have the potential to offer real benefits, but the dark side of that seemingly shiny coin is this: companies will increasingly know all there is to know about you.  Most people are already aware that virtually everything a typical person does on the Internet is tracked. In the not-too-distant future, however, real space will be increasingly like cyberspace, thanks to our headlong rush toward that Internet of Things. With the rise of the networked device, what people do in their homes, in their cars, in stores, and within their communities will be monitored and analyzed in ever more intrusive ways by corporations and, by extension, the government.

– More… ➡

– Research thanks to:  Piers L.

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On the Wrong Side of Globalization

Wednesday, March 19th, 2014

By JOSEPH E. STIGLITZ in the Opinion section of the New York Times

 

Trade agreements are a subject that can cause the eyes to glaze over, but we should all be paying attention. Right now, there are trade proposals in the works that threaten to put most Americans on the wrong side of globalization.

The conflicting views about the agreements are actually tearing at the fabric of the Democratic Party, though you wouldn’t know it from President Obama’s rhetoric. In his State of the Union address, for example, he blandly referred to “new trade partnerships” that would “create more jobs.” Most immediately at issue is the Trans-Pacific Partnership, or TPP, which would bring together 12 countries along the Pacific Rim in what would be the largest free trade area in the world.

Negotiations for the TPP began in 2010, for the purpose, according to the United States Trade Representative, of increasing trade and investment, through lowering tariffs and other trade barriers among participating countries. But the TPP negotiations have been taking place in secret, forcing us to rely on leaked drafts to guess at the proposed provisions. At the same time, Congress introduced a bill this year that would grant the White House filibuster-proof fast-track authority, under which Congress simply approves or rejects whatever trade agreement is put before it, without revisions or amendments.

Controversy has erupted, and justifiably so. Based on the leaks — and the history of arrangements in past trade pacts — it is easy to infer the shape of the whole TPP, and it doesn’t look good. There is a real risk that it will benefit the wealthiest sliver of the American and global elite at the expense of everyone else. The fact that such a plan is under consideration at all is testament to how deeply inequality reverberates through our economic policies.

Worse, agreements like the TPP are only one aspect of a larger problem: our gross mismanagement of globalization.

Let’s tackle the history first. In general, trade deals today are markedly different from those made in the decades following World War II, when negotiations focused on lowering tariffs. As tariffs came down on all sides, trade expanded, and each country could develop the sectors in which it had strengths and as a result, standards of living would rise. Some jobs would be lost, but new jobs would be created.

Today, the purpose of trade agreements is different. Tariffs around the world are already low. The focus has shifted to “nontariff barriers,” and the most important of these — for the corporate interests pushing agreements — are regulations. Huge multinational corporations complain that inconsistent regulations make business costly. But most of the regulations, even if they are imperfect, are there for a reason: to protect workers, consumers, the economy and the environment.

What’s more, those regulations were often put in place by governments responding to the democratic demands of their citizens. Trade agreements’ new boosters euphemistically claim that they are simply after regulatory harmonization, a clean-sounding phrase that implies an innocent plan to promote efficiency. One could, of course, get regulatory harmonization by strengthening regulations to the highest standards everywhere. But when corporations call for harmonization, what they really mean is a race to the bottom.

– More… ➡

 

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Nasa-funded study: industrial civilisation headed for ‘irreversible collapse’?

Monday, March 17th, 2014

“With the enemy’s approach to Moscow, the Moscovites’ view of their situation did not grow more serious but on the contrary became even more frivolous, as always happens with people who see a great danger approaching.

At the approach of danger there are always two voices that speak with equal power in the human soul: one very reasonably tells a man to consider the nature of the danger and the means of escaping it; the other, still more reasonably, says that it is too depressing and painful to think of the danger, since it is not in man’s power to foresee everything and avert the general course of events, and it is therefore better to disregard what is painful till it comes, and to think about what is pleasant.”

– Leo Tolstoy – War and Peace

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Natural and social scientists develop new model of how ‘perfect storm’ of crises could unravel global system

A new study sponsored by Nasa’s Goddard Space Flight Center has highlighted the prospect that global industrial civilisation could collapse in coming decades due to unsustainable resource exploitation and increasingly unequal wealth distribution.

Noting that warnings of ‘collapse’ are often seen to be fringe or controversial, the study attempts to make sense of compelling historical data showing that “the process of rise-and-collapse is actually a recurrent cycle found throughout history.” Cases of severe civilisational disruption due to “precipitous collapse – often lasting centuries – have been quite common.”

The research project is based on a new cross-disciplinary ‘Human And Nature DYnamical’ (HANDY) model, led by applied mathematician Safa Motesharri of the US National Science Foundation-supported National Socio-Environmental Synthesis Center, in association with a team of natural and social scientists. The study based on the HANDY model has been accepted for publication in the peer-reviewed Elsevier journal, Ecological Economics.

It finds that according to the historical record even advanced, complex civilisations are susceptible to collapse, raising questions about the sustainability of modern civilisation:

“The fall of the Roman Empire, and the equally (if not more) advanced Han, Mauryan, and Gupta Empires, as well as so many advanced Mesopotamian Empires, are all testimony to the fact that advanced, sophisticated, complex, and creative civilizations can be both fragile and impermanent.”

By investigating the human-nature dynamics of these past cases of collapse, the project identifies the most salient interrelated factors which explain civilisational decline, and which may help determine the risk of collapse today: namely, Population, Climate, Water, Agriculture, and Energy.

These factors can lead to collapse when they converge to generate two crucial social features: “the stretching of resources due to the strain placed on the ecological carrying capacity”; and “the economic stratification of society into Elites [rich] and Masses (or “Commoners”) [poor]” These social phenomena have played “a central role in the character or in the process of the collapse,” in all such cases over “the last five thousand years.”

Currently, high levels of economic stratification are linked directly to overconsumption of resources, with “Elites” based largely in industrialised countries responsible for both:

“… accumulated surplus is not evenly distributed throughout society, but rather has been controlled by an elite. The mass of the population, while producing the wealth, is only allocated a small portion of it by elites, usually at or just above subsistence levels.”

The study challenges those who argue that technology will resolve these challenges by increasing efficiency:

“Technological change can raise the efficiency of resource use, but it also tends to raise both per capita resource consumption and the scale of resource extraction, so that, absent policy effects, the increases in consumption often compensate for the increased efficiency of resource use.”

Productivity increases in agriculture and industry over the last two centuries has come from “increased (rather than decreased) resource throughput,” despite dramatic efficiency gains over the same period.

Modelling a range of different scenarios, Motesharri and his colleagues conclude that under conditions “closely reflecting the reality of the world today… we find that collapse is difficult to avoid.” In the first of these scenarios, civilisation:

“…. appears to be on a sustainable path for quite a long time, but even using an optimal depletion rate and starting with a very small number of Elites, the Elites eventually consume too much, resulting in a famine among Commoners that eventually causes the collapse of society. It is important to note that this Type-L collapse is due to an inequality-induced famine that causes a loss of workers, rather than a collapse of Nature.”

Another scenario focuses on the role of continued resource exploitation, finding that “with a larger depletion rate, the decline of the Commoners occurs faster, while the Elites are still thriving, but eventually the Commoners collapse completely, followed by the Elites.”

In both scenarios, Elite wealth monopolies mean that they are buffered from the most “detrimental effects of the environmental collapse until much later than the Commoners”, allowing them to “continue ‘business as usual’ despite the impending catastrophe.” The same mechanism, they argue, could explain how “historical collapses were allowed to occur by elites who appear to be oblivious to the catastrophic trajectory (most clearly apparent in the Roman and Mayan cases).”

Applying this lesson to our contemporary predicament, the study warns that:

“While some members of society might raise the alarm that the system is moving towards an impending collapse and therefore advocate structural changes to society in order to avoid it, Elites and their supporters, who opposed making these changes, could point to the long sustainable trajectory ‘so far’ in support of doing nothing.”

However, the scientists point out that the worst-case scenarios are by no means inevitable, and suggest that appropriate policy and structural changes could avoid collapse, if not pave the way toward a more stable civilisation.

The two key solutions are to reduce economic inequality so as to ensure fairer distribution of resources, and to dramatically reduce resource consumption by relying on less intensive renewable resources and reducing population growth:

“Collapse can be avoided and population can reach equilibrium if the per capita rate of depletion of nature is reduced to a sustainable level, and if resources are distributed in a reasonably equitable fashion.”

The NASA-funded HANDY model offers a highly credible wake-up call to governments, corporations and business – and consumers – to recognise that ‘business as usual’ cannot be sustained, and that policy and structural changes are required immediately.

Although the study is largely theoretical, a number of other more empirically-focused studies – by KPMG and the UK Government Office of Science for instance – have warned that the convergence of food, water and energy crises could create a ‘perfect storm’ within about fifteen years. But these ‘business as usual’ forecasts could be very conservative.

– To the original article:  ➡

 

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The Verdict on Thatcherism Is Clear

Thursday, March 13th, 2014

Simply compare how her UK squandered its oil wealth compared to Norway

Nothing says free market capitalism like Margaret Thatcher. The Iron Lady once proclaimed, “Socialist governments traditionally do make a financial mess. They always run out of other people’s money.”

Thirty-five years after she swept to power as British prime minister, it is ironic that socialist Norway now has $830 billion in the bank and enjoys fully funded social programs that most of us can only dream of. Meanwhile the U.K. is enduring another round of wrenching austerity and owes over £1.3 trillion — about US$2.2 trillion. That massive debt grows by about $3.8 billion each week, while every seven days Norway adds another billion dollars to their bank account.

What happened? Both countries were in dire economic straights in early 1970s. Both countries came into the financial windfall of North Sea oil around the same time, exploiting the same resource — sometimes from the same drill rig. How could they have ended up in such vastly different places?

Rarely in history has there been such a clear-cut opportunity to explore the real world success or failure of competing world-views. Thatcherism has gone on to become an economic school of thought with true believers in positions of power around the world. The doctrine of cutting taxes, privatizing government assets and embracing deregulation continues apace around the globe to this day. But does it work?

First let’s agree on some fundamentals. Wealth flows from resources and oil is a particularly lucrative bounty. The 75 billion barrels of light sweet crude discovered in the North Sea was worth over $8 trillion at 2014 prices. With that much money on the table and the resource roughly evenly split between the U.K. and Norway, let’s see how socialism and Thatcherism fared in this economic cage match.

For starters, Norway isn’t precisely “socialist.” Like other Scandinavian countries, they have a mixed-market economy with relatively high levels of taxation and comprehensive social programs. The main difference was that Norwegians did not have an allergic aversion to public participation in their economy.

One of the first things the Norwegian government did was to incorporate a state owned oil company — Statoil — to ensure they had an equity stake in their own oil production and to act as a repository for oil expertise. Since Norway knew essentially nothing about the oil business, they had to learn fast and having a player on the field helped them do that.

Oil is also a good investment and the Norwegian taxpayer has enjoyed over $23 billion in Statoil dividends from their government’s stake in the company since it was founded in 1972. The equity value of those shares is worth another $64 billion.

Lady Thatcher on the other hand embraced the conservative ideal of minimizing government presence in the marketplace, virtually inventing the process of privatization. One of her first acts on election was to sell 80 million shares of British Petroleum, ending the majority stake the U.K. government had held in the company since 1913 on the advice of Winston Churchill. Thatcher sold the U.K.’s remaining 1.7 billion shares in BP immediately after the stock market crash of 1987. While this raised $20 billion at the time, adjusted for inflation, those same shares would be worth over $87 billion today.

Taxation is of course another yawning philosophical divide between Thatcherism and the Norwegian model. While Norway needed outside expertise and capital to develop offshore drilling operations, they also wanted to tax foreign companies to limits of tolerance — to “squeeze the lemon to the maximum” as one historian told me. An unspoken role of Statoil was to pass on informed intelligence from within the oil industry on costs, prices and players so the Norwegian government could better prevail at the negotiating table.

This was no garden party. With literally trillions of dollars at stake, Norway was playing to win. At one iconic meeting in 1974 the Norwegian government announced to a delegation of oil companies that they were raising the level of taxation on petroleum profits to 90 per cent from 50. After the shouting had died down, the minister expressed disappointment that some of them did not walk away from their offshore leases. “We should have taken more,” he admonished his bureaucrats in full view of the enraged oil executives.

Thatcher on the other hand seemed more enamoured with ideology than money. She told a Conservative conference in 1977, “Our aim is to make tax collecting a declining industry.” She and successive governments succeeded in that dubious goal. Even though the U.K. extracted nine per cent more oil and gas by 2011, they collected $156 billion less in petroleum taxes and royalties than the Norwegians.

– More… ➡

 

– Research thanks to Kierin M.

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Right to refuse access by mining companies voted down in Senate

Thursday, March 13th, 2014

– This in from Australia which appears to be the U.S.’s little brother clone in the South Pacific.  

– There, the corporations, through influence on government, are slowly gaining their will in all things – just as we’ve seen for some time now in the U.S.

– dennis

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A bill to give farmers and others the right to veto entry onto their properties by mining, oil and gas companies has been voted down in the Senate.

Queensland Greens Senator Larissa Waters introduced the ‘Landholders Right to refuse (Gas and Coal) Bill 2013’, which was defeated 44 to 9.

The bill also called for the Federal Government to buy back farms that have coal seam gas and coal mines on them.

Senator Waters says moves to protect prime agricultural land in Queensland and so-called critical industry clusters in New South Wales have failed to protect farmers.

“We saw an awful lot of promises on this issue before those respective parties were elected that they would act on this issue,” she said.

“What’s been produced just under-delivers in the extreme.

“Queensland made these promises years ago, and still haven’t even delivered. It’s still in bill format.

“The New South Wales ultimate protections that were passed actually have so many holes in them it’s almost like they’re a coal seam gas well themselves.”

Senator Waters says the bill was to redress the lack of right of farmers and others.

“Currently landholders across the country, in most instances, don’t have the right to say no to mining and coal seam gas companies that want to come onto their property.

“They only have the right to negotiate the compensation amount that they get.

– More… ➡

 

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Energy firm cyber-defence is ‘too weak’, insurers say

Monday, March 3rd, 2014

technology11– I’m not surprised about this development.  Why it has taken this long to bubble up to where it is considered a ‘serious’ threat is beyond me.  

– To see why I say this, check out this article from April of 2009 on Samadhisoft.

– And, if you are wondering how far and how wide these sorts of threats go, then simply click here on the ‘cyber-chaos’ category here on samadhisoft to see all the stories we’ve published on this subject.  

– And we have, I assure you, only touched the tip of the iceberg.

– dennis

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Power companies are being refused insurance cover for cyber-attacks because their defences are perceived as weak, the BBC has learned.

Underwriters at Lloyd’s of London say they have seen a “huge increase” in demand for cover from energy firms.

But surveyor assessments of the cyber-defences in place concluded that protections were inadequate.

Energy industry veterans said they were “not surprised” the companies were being refused cover.

“In the last year or so we have seen a huge increase in demand from energy and utility companies,” said Laila Khudari, an underwriter at the Kiln Syndicate, which offers cover via Lloyd’s of London.

The market is one of few places in the world where businesses can come to insure such things as container ships, oil tankers, and large development projects and to secure cash that would help them recover after disasters.

‘Worried’

For years, said Ms Khudari, Kiln and many other syndicates had offered cover for data breaches, to help companies recover if attackers penetrated networks and stole customer information.

Now, she said, the same firms were seeking multi-million pound policies to help them rebuild if their computers and power-generation networks were damaged in a cyber-attack.

“They are all worried about their reliance on computer systems and how they can offset that with insurance,” she said.

Any company that applies for cover has to let experts employed by Kiln and other underwriters look over their systems to see if they are doing enough to keep intruders out.

Assessors look at the steps firms take to keep attackers away, how they ensure software is kept up to date and how they oversee networks of hardware that can span regions or entire countries.

Unfortunately, said Ms Khudari, after such checks were carried out, the majority of applicants were turned away because their cyber-defences were lacking.

– More… ➡

 

 

 

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Supreme Court rules Drug Companies exempt from Lawsuits

Wednesday, February 26th, 2014

“In short, the Court ruled that the FDA has ultimate authority over pharmaceuticals in the US. And if the FDA says a drug is safe, that takes precedent over actual facts, real victims and any and all adverse reactions.”

– Corporate rights are clearly taking the ascendancy over citizen rights.   How far can this trend run before things get wicked?

– dennis

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July 7, 2013. Washington. In case readers missed it with all the coverage of the Trayvon Martin murder trial and the Supreme Court’s rulings on gay marriage and the Voting Rights Act, the US Supreme Court also made a ruling on lawsuits against drug companies for fraud, mislabeling, side effects and accidental death. From now on, 80 percent of all drugs are exempt from legal liability.

Drug companies failed to warn patients that toxic epidermal necrolysis was a side effect. But the Supreme Court ruled they’re still not liable for damages.

In a 5-4 vote, the US Supreme Court struck down a lower court’s ruling and award for the victim of a pharmaceutical drug’s adverse reaction. According to the victim and the state courts, the drug caused a flesh-eating side effect that left the patient permanently disfigured over most of her body. The adverse reaction was hidden by the drug maker and later forced to be included on all warning labels. But the highest court in the land ruled that the victim had no legal grounds to sue the corporation because its drugs are exempt from lawsuits.

Karen Bartlett vs. Mutual Pharmaceutical Company

In 2004, Karen Bartlett was prescribed the generic anti-inflammatory drug Sulindac, manufactured by Mutual Pharmaceutical, for her sore shoulder. Three weeks after taking the drug, Bartlett began suffering from a disease called, ‘toxic epidermal necrolysis’. The condition is extremely painful and causes the victim’s skin to peel off, exposing raw flesh in the same manner as a third degree burn victim.

Karen Bartlett sued Mutual Pharma in New Hampshire state court, arguing that the drug company included no warning about the possible side effect. A court agreed and awarded her $21 million. The FDA went on to force both Mutual, as well as the original drug manufacturer Merck & Co., to include the side effect on the two drugs’ warning labels going forward.

Now, nine years after the tragedy began, the US Supreme Court overturned the state court’s verdict and award. Justices cited the fact that all generic drugs and their manufacturers, some 80% of all drugs consumed in the United States, are exempt from liability for side effects, mislabeling or virtually any other negative reactions caused by their drugs. In short, the Court ruled that the FDA has ultimate authority over pharmaceuticals in the US. And if the FDA says a drug is safe, that takes precedent over actual facts, real victims and any and all adverse reactions.

– More… ➡

 

 

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