Archive for August, 2010


Bob Cavnar’s Upcoming Book is an Exciting “Sleeper” – Publisher’s Weekly

Tuesday, August 31st, 2010

From Publisher’s Weekly:

Although last fall was known for its “embarrassment of riches,” this fall’s title selection is plenty strong as well.

“I feel great about the fall—the momentum is already here. I see tons of stuff about the end of the book is nigh, but I keep selling books,” says Sheryl Cotleur, buying director of Book Passage in Corte Madera, Calif., which has sold over a thousand copies of David Mitchell’s The Thousand Autumns of Jacob Zoet this summer. “Besides,” says Mark Mouser, manager of general books at University Book Store in Seattle, “a less crowded field gives us more opportunity to find unnoticed gems and sell the heck out of them.”

Read the whole article here…

Find out more about Disaster on the Horizon here…

Watch Bob Cavnar on MSNBC’s Countdown with Keith Olbermann.

And last but not least, keep up to speed with the continuing struggle to plug the gaping hole in the Gulf floor on Bob’s wonderful blog, The Daily Hurricane.

Jamie Court: Will ‘Progressives’ Let Middle Class Burn to Prove Their Point?

Tuesday, August 31st, 2010

When Anthem Blue Cross announced its controversial premium increases in California recently, the insurer claimed, “a carrier must be able to receive actuarially sound rates.”

So it is remarkable that “progressive” San Francisco State Senator Mark Leno, a single payer health care advocate, recently introduced eleventh hour legislation codifying Anthem Blue Cross’s “actuarially sound” defense of premium increases in law.

Advocates like me, who have battled the insurance companies for decades, know “actuarially sound” is code for whatever an insurance actuary says is “actuarially sound,” not what a regulator determines is really excessive.

Why would a single payer advocate, who wants to get rid of insurers, now want to give insurers more freedom?

It’s as though Leno is saying if he cannot beat the insurance companies with single payer, you might as well join them.

The conundrum is one progressives will have to grapple with: Why not let Rome burn and rebuild it, rather than making it better?

The answer for Senator Leno should be clear. He will have to face constituents who are forced to buy health insurance by 2014 or face tax penalties, and he will have made their health insurance more expensive.

Leno’s bill, SB 1163, undercuts a stronger proposal by State Senator Dave Jones, who will likely be the next California insurance commissioner and wants the power to say no to excessive premium increases. Leno’s bill is sucking support away from Jones’ AB 2578 because Leno is giving legislators an easier way — join with the insurers.

Progressives cannot afford to walk away from the suffering of the middle class to prove a point or make a case. Yet that’s the type of talk I am hearing more and more from progressives as the midterm approaches.

I am a single payer advocate but I also fight for premium regulation. I do it because I know it works and to help people who cannot afford their health insurance.

Twenty two years ago Consumer Watchdog’s founder Harvey Rosenfield reined in auto and home insurers’ premiums under the very same regulatory tools Senator Jones is trying to apply to health insurers. The Consumer Federation of America says Prop 103 saved motorists $62 billion on their auto insurance. You would think Leno might listen to people who saved insurance policyholders $62 billion if he really cared.

I fight for people like Mary Feller, whose individual Anthem Blue Cross policy was set to spike 39% when she held a press conference with me, Rosenfield and single payer advocates in the Bay area a few months ago. There was hardly a dry eye in the place when Mary talked about her health insurance premiums costing as much as her mortgage. The single payer advocates there also became supporters of premium regulation that day because they knew we had to do something. They knew you cannot let the middle class burn if you want to save it.

“I feel scammed by Anthem Blue Cross of California,” Feller said. “Using a corporate shell game and Draconian underwriting rules, they’ve trapped my family in a plan with costs that are spiraling out of control. It’s time to stop these unfair practices!”

The question for Senator Mark Leno is how does he look Mary Feller, who lives in his area, in the eye after his end-of-the-session shenanigans helping Anthem Blue Cross. It should be a cautionary tale for progressives. The view from the ivory tower is no way to take back the nation or the progressive movement. We need to see the struggles of the middle class from the streets.

Jamie Court is president of Consumer Watchdog and author of The Progressive’s Guide To Raising Hell: How To Win Grassroots Campaigns, Pass Ballot Box Laws And Get The Change We Voted For.

Follow Jamie Court on Twitter: @RaisingHellNow.

This article was originally published by The Huffington Post.

Robert Kuttner: Simpson’s ‘Tits’ Are the Least of It

Tuesday, August 31st, 2010

When you think about it, Alan (“Tits”) Simpson is the ideal jester to deflect attention from the bigger joke — the fiscal reform commission itself. The problem is less Simpson’s dopey comments and more the idiocy of the rest of the commission.

Given what is happening to the real economy in the real world, the prospect of a double-dip recession and the prospect of a lost decade of high unemployment, the idea that the bigger menace is Social Security is just whacko. Let’s recall that Social Security is in surplus until 2037!

Yet the idea that the road to recovery leads though cuts in Social Security, Medicare, and other social outlays that are keeping the depression from worsening, if anything, is gaining traction among opinion elites.

Exhibit A is a doubly dishonest column by the New York Times‘ new whiz-kid pundit, Matt Bai, who used a liberal congressman, Earl Blumenauer of Oregon, as a prop to make his misleading case.

According to Bai’s column, Security is like a giant lottery, based on IOU’s that will require a Ponzi Scheme of further debt. Now, it turns out that Bai is not just wrong on the issues, but Blumenauer doesn’t believe what Bai attributed to him. In attacking the progressive coalition Strengthen Social Security, Bai wrote:

The coalition bases its case on the idea that Social Security is actually in fine fiscal shape, since it has amassed a pile of Treasury Bills — often referred to as i.o.u.’s — in a dedicated trust fund. This is true enough, except that the only way for the government to actually make good on these i.o.u.’s is to issue mountains of new debt or to take the money from elsewhere in the federal budget, or perhaps impose significant tax increases… So this is sort of like saying that you’re rich because your friend has promised to give you 10 million bucks just as soon as he wins the lottery.

But this is total malarkey. In fact, the 75-year projection of Social Security’s finances shows that under fairly pessimistic assumptions about economic growth, the shortfall in Social Security’s finances is just over half of one percent of GDP. Lift the cap on earnings subject to Social Security taxes, and the problem disappears.

More importantly, get wage growth back to its historic trend of increasing as productivity increases (rather than the top getting the benefit of all the economic gains) and the problem vanishes without changing the tax code. Raise wages, and we could increase Social Security benefits.

Bai not only distorted the reality of Social Security, but he also distorted Blumenauer’s views, cherry picking quotes from two interviews to make it seem that the congressman favored such drastic measures promoted by deficit hawks as cutting benefits or raising the retirement age. But the quotes in the column don’t say that — only Bai’s gloss on them — and the congressman believes nothing of the sort.

The trouble is that too many legislators make Delphic comments about whether Social Security should be “on the table,” Bluenenauer’s past vagueness gave Bai an opening, and Bai is all too representative of opinion elites — including the Washington Post editorial page, columnists like David Broder, many Democratic as well as Republican congressmen, and some in the Obama administration.

It was former Budget Director Peter Orszag, seconded by chief of staff Rahm Emanuel and the pollsters, who persuaded President Obama that the fiscal commission was a good idea. The theory was that the commission would give the president “cover” and demonstrate that he was fiscally responsible.

But as events have played out, this premise totally backfired. The commission provides plenty of cover all right, as in burial cloth. Its proposals could bury both the economy and this presidency.

The commission has given a platform to clowns like Simpson. But worse, it has lent credibility to the idea that Social Security is somehow a drag on the economy — creating a vicious circle of hawkish legislators and dishonest pundits like Bai feeding on each other.

The reality, of course, is that if the economy (and Obama’s fortunes) are going down the drain, the reason has nothing to do with Social Security’s finances in 2037 — and everything to do with slow growth, high unemployment, and the lingering effects of a damaged banking system right now.

Yet the storyline being peddled by the commission, of a dire fiscal crisis, makes it politically more difficult for Obama to take the necessary steps to get a recovery going.

There is a whole other path to economic recovery and fiscal balance. That other path has five parts:

  • A lot more emergency federal spending now to create jobs and purchasing power.
  • Increased taxes on the top two percent.
  • A continued program of public investment in physical and social infrastructure
  • A real public option on health insurance, to restrain medical inflation, which is the prime driver of federal deficits in the long run.
  • A defense of Social Security as a key source of income for the elderly.

This strategy is better economics and better politics. Voters, by overwhelming margins, support Social Security. Over the years, Republicans have tried to tamper with it. And it is lunacy for Democrats to associate themselves with efforts to cut it.

But Obama’s own fiscal commission has painted the president into a corner. Virtually all of the remedies we need to get a strong recovery going are seen as fiscally too costly; and willingness to go after Social Security is being touted as the test of fiscal responsibility.

The campaign to fire Simpson has the right spirit but the wrong target. Obama should draw a line in the sand and make clear that if the commissioners propose cuts in Social Security, he will consider the whole exercise tainted.

Maybe we should be grateful for Simpson and his 310 million tits. If his antics lead serious commentators take a closer look at the commission, perhaps they will also look deeper into the fiscal foolishness of Simpson’s colleagues.
This article was originally published by The Huffington Post.

Robert Kuttner’s new book is A Presidency in Peril. He is co-editor of The American Prospect and a Senior Fellow at Demos.

Riki Ott: An Open Letter to US EPA, Region 6

Monday, August 30th, 2010

Sam Coleman
U.S. EPA, Region 6
1445 Ross Ave.
Dallas, TX 75202-2733 Via email: [email protected]

August 27, 2010

Re: Documentation of continued dispersant spraying in near shore and inland waters from Florida to Louisiana (despite contrary claims by USCG and BP) and documentation that dispersants made oil sink

Dear Mr. Coleman,

During the August 25 Dockside Chat in Jean Lafitte, LA, it came to our attention that the federal agencies were unaware — or lacking proof — of the continued spraying of dispersants from Louisiana to Florida. Further, the federal agencies were woefully ignorant of the presence of subsurface oil-dispersant plumes and sunken oil on ocean and estuary water bottoms. We offer evidence to support our statements, including a recently declassified subsurface assessment plan from the Incident Command Post.

But first, you mentioned that such activities (continued spraying of dispersants and sinking oil) — if proven — would be “illegal.” As you stated, sinking agents are not allowed in oil spill response under the National Contingency Plan Subpart J §300.910 (e): “Sinking agents shall not be authorized for application to oil discharges.”

We would like to know under what laws (not regulations) such activities are illegal and what federal agency or entity has the authority to hold BP accountable, if indeed, such activity is illegal. It is not clear that the EPA has this authority.

For example, on May 19, the EPA told BP that it had 24 hours to choose a less toxic form of chemical dispersants and must apply the new form of dispersants within 72 hours of submitting the list of alternatives. Spraying of the Corexit dispersants continued unabated. On May 26, the EPA and Coast Guard told BP to eliminate the use of surface dispersants except in rare cases where there may have to be an exemption and to reduce use of dispersants by 75 percent. Yet in a letter dated July 30, the congressional Subcommittee on Energy and the Environment reported the USCG on-scene commander (OSC) had approved 74 exemption requests to spray dispersants between May 28 and July 14.

Under the National Contingency Plan Subpart J, the authorization of use §300.910 (d) gives the OSC the final authority on dispersant use: “The OSC may authorize the use of any dispersant… without obtaining the concurrence of he EPA representative… when, in the judgment of the OSC, the use of the product is necessary to prevent or substantially reduce a hazard to human life.”

Given this history of events and the NCP regulation, we would like to know what federal entity actually has the final authority to: order BP to stop spraying of dispersant; declare that spraying of dispersant after issuance of a cease and desist order is illegal; and prosecute BP for using product to sink oil.

The documentation of dispersant spraying in nearshore and inland waters includes:
√ claims by USCG and BP
√ eyewitness accounts
√ fish kills in areas of eyewitness accounts
√ photos of white foam bubbles and dispersant on boat docks in areas of eyewitness accounts
√ sick people in areas of eyewitness accounts

Claims by USCG and BP – and Counter Evidence

July 30-31: Lt. Cmdr. of USCG confirms, “Dispersants are only being used over the wellhead in Louisiana.”

  • When reached for comment, Lt. Cmdr. Dale Vogelsang, liaison officer with the United State Coast Guard, told The (Destin) Log he had contacted Unified Command and they had “confirmed” that dispersants were not being used in Florida waters.
  • “Dispersants are only being used over the wellhead in Louisiana,” Vogelsang said. “We are working with Eglin and Hurlburt to confirm what the flight pattern may be. But right now, it appears to be a normal flight.”
  • Vogelsang also said Unified Command confirmed to him that C-130s have never been used to distribute dispersants, as they “typically use smaller aircraft.”

Contradicted by evidence in same Destin The Log article and posted on websites:

  • But according to an article by the 910th Airlift Wing Public Affairs Office, based in Youngstown, OH., C-130H Hercules aircraft started aerial spray operations Saturday, May 1, under the direction of the president of the United States and Secretary of Defense. “The objective of the aerial spray operation is to neutralize the oil spill with oil dispersing agents,” the article states.
  • A Lockheed Martin July newsletter states that “Lockheed Martin aircraft, including C-130s and P-3s, have been deployed to the Gulf region by the Air Force, Coast Guard and other government customers to perform a variety of tasks, such as monitoring, mapping and dispersant spraying.”
  • Further: “Throughout the effort, Lockheed Martin employees have been recognized for their contributions in a wide range of roles. IS&GS senior network engineer Lawrence Walker, for example, developed a solution to a critical networking issue involving two C-130′s that arrived from the Air Force Reserve Command’s 910th Airlift Wing at Youngstown, Ohio, as part of the cleanup mission.”

May 11: USCG and BP claims of no dispersant spraying activities are further contradicted by intentional mislabeling of flight plans:

  • Aerial dispersant operations – Houma Status Report, Dispersant Application Guidance, p. 4, point 8: “Use discreet IFF codes as provided on separate correspondence. This removes need to file DVFR flight plans.”

Destin – Fort Walton, FL
July 30-31: Destin Mayor Sam Seevers investigating claims of dispersant spraying:

  • Resident and former VOO worker Joe Yerkes testified that he witnessed a military C-130 “flying from the north to the south, dropping to low levels of elevation then obviously spraying or releasing an unknown substance from the rear of the plane.”
  • The unknown substance, Yerkes wrote, “was not smoke, for the residue fell to the water, where smoke would have lingered.”

Austin Norwood, whose boat is contracted by Florida Fish and Wildlife, also provided a written account of a “strange incident.”

  • While Norwood was observing wildlife offshore, he had received a call from his site supervisor at Joe’s Bayou. After telling the supervisor that he and his crewmember were not feeling well, the supervisor had the two men come in “to get checked out because a plane had been reported in our area spraying a substance on the water about 10- 20 minutes before.”
  • Norwoord complained of a bad headache, nasal congestion while his crewmember said he had a metallic taste in his mouth.
  • After filling out an incident report, both Norwood and his crewmember were directed to go to the hospital. The following day, the two men were once again “asked to go to the hospital for blood tests.”

Aug. 2: Joe Yerkes reported sludgy brown oil and foamy white dispersant bubbles in Destin and 40 miles east in St. Joe Bay, just days before a fish kill of croaker, flounder, trout, and baitfish on August 5.

Perdido Pass, AL
Aug. 24: Received report of oil debris from anchor chain while weighing anchor at position 30*15.6 N 87*32.7 W, 0.6 nm east of Perdido Pass sea buoy. Samples taken.

Dauphin Island, AL
Aug. 21: Fisherman Chris Bryant documents Corexit 9500 use

Aug. 24: Washington’s Blog interview with chemist Bob Naman

  • Bob Naman is the analytical chemist who performed the tests featured in WKRG’s broadcast. He was interviewed by or an August 24 report. Highlights include:
  • Naman found 2-butoxyethanol in the Cotton Bayou sample. [Ingredient in 'discontinued' Corexit 9527.]
  • Naman said found no propylene glycol, the main ingredient of Corexit 9500.
  • Naman said he went to Dauphin Island, Alabama last night and while there observed many 250-500 gallon barrels which were labeled Corexit 9527. Naman took pictures that he will soon be sharing.
  • Naman said he saw men applying the Corexit 9527 while he was in Dauphin Island and also in Bayou La Batre, Alabama.
  • Naman said the Corexit 9527 is being haphazardly sprayed at night and is impacting beach sands in a highly concentrated form.

Bayou La Batre, AL
Aug. 4: Fisherman Chris Byrant documents oil-dispersant in Mississippi Sound, northwest of Katrina Cut, in an area open to fishing in state waters between Dauphin Island and Bayou La Batre

Aug. 19, Aug. 21: Rocky Kistner with NRDC documents use of Corexit 9527a and Corexit 9500 and oil-dispersant visible sheen in area open to fishing in state waters

Aug. 23: Natural Resources Defense Council Switchboard posting
We spotted huge plastic containers marked with Corexit warning labels on the dock public docks near Bayou La Batre. …
The next day at a town hall meeting in Buras, LA, BP Mobile Incident Commander Keith Seilhan was asked about the use of chemical dispersants. “We are not using dispersants and haven’t been for some time,” he said.
But when asked whether contractors who operate in state waters could be, he said he could not be certain. “We have lots of contractors, but no one should be using them. If they are, we need to know about it and stop it.”

Long Beach, MS
Aug. 8: Fisherman James “Catfish” Miller sampled the subsurface oil plume (VIDEO)

Miller tied an oil absorbent pad onto a pole and lowered it 8-12 feet down into deceptively clear ocean water. When he pulled it up, the pad was soaked in oil, much to the startled amazement of his guests, including Dr. Timothy Davis with the Department of Health and Human Services National Disaster Medical System. Repeated samples produced the same result. Three weeks earlier, there had been a massive fish kill along the same shoreline from Gulfport to Pass Christian.

Aug. 23: The methods for sampling subsurface oil used by Mr. Miller are also being used by Incident Command for the Deepwater Horizon as evidenced in a declassified document (p. 3).

Hancock County, MS
Aug. 23: Dispersant container found in Bayou Caddy Hancock County marsh. White foam indicative of dispersant use in marsh. Samples taken and being analyzed.

Barataria, LA
July 31: Documentation of oil in Barataria Bay.

Venice, LA
Aug. 11 (reported): Contractor sick from dispersant spraying

Summary: Based on these documents, and more, we believe that dispersant spraying in inland and near shore waters across the Gulf of Mexico from Louisiana to the western Florida panhandle is occurring now and has continued unabated (before) and since July 19, the date that the seafood safety panel proclaimed was the last day dispersants were sprayed. Based on these documents, and more, we believe that the dispersant spraying in inland and near shore waters is being conducted for the sole purpose of sinking the visible oil, an activity that is supposedly illegal. According to the University of South Florida, dispersed oil micro-droplets have been documented throughout the Gulf water column and are likely to affect the entire ecosystem.

The inability of the federal and state agents who attended the Dockside Chat in Jean Lafitte, LA, on Aug. 25 to find recent subsurface oil and ocean bottom oil or dispersant spraying activity in inland or near shore waters gives us zero confidence in these same agencies’ declaration that they can find no oil or dispersant in Gulf seafood product.

Sincerely,

Riki Ott, PhD
Ultimate Civics Project
Earth Island Institute
POB 1460
Cordova, AK 99574
970-903-6818
www.RikiOtt.com

Riki originally posted this letter on The Huffington Post.

Riki’s book on the traumatic experience of the Exxon Valdez spill, Not One Drop, is available in our bookstore.

Bob Cavnar: BP’s Fishing Folly is a Complete Failure

Monday, August 30th, 2010

Admiral Allen announced today that BP’s fishing job being undertaken on their Mississippi Canyon Block 252 well has been called off due to total failure.  You’ll recall that I disagreed with the procedure when it was announced on the 21st, believing it was unwise and risky.  After now attempting to fish out the drill pipe (actually 3 pieces) for several days, they have called off the job after completely failing at achieving their goal.  Previously, Adm. Allen had said that they wanted to get all the drill pipe out before pulling the BOP (which I also think is unwise), and replacing it with the BOP from the DDII before completing the relief well.

Now, after being treated to a remarkable demonstration of the capabilities of downhole cameras the last couple of nights, we at least know what’s inside the BOP, the general condition of the rams, and also that even brand new capping stack rams are subject to getting jammed by hydrates.  Two nights ago, they couldn’t get the rams on the capping stack open and had to de-hydrate them with methanol and glycol before they would work.  Not comforting.  After multiple camera runs, pumping more methanol and glycol, and a few failed fishing tool runs, they’ve thrown in the towel.  However, take heart.  They’re going to pull the damn BOP anyway.  That’s right, they’re going to pull the BOP anyway.  What’s amazing is that they’re pulling it with an estimated 3,000 feet of drill pipe hanging in a set of rams, as well as two other smaller pieces in the stack and God knows what else.  Admiral Allen said they’re setting an overpull limit of 80,000 pounds over stack weight to pull it free, worried that more would dislodge the casing hanger and packoff that are supposedly in the casing hanger.  They couldn’t get the camera in that far down, but they still continue to assume that all that is somehow still in place after the well blowing out and flowing for 87 days, probably right through where they say the packoff is set.  Not likely.  Allen says they’re going to actually try to pull the drill pipe, still hung in the rams and then, while suspending the BOP above the casinghead, cut the drill pipe with ROVs and drop it back in the well.

Probability of success of getting that done?  Almost zero. First, it will be a miracle if they can get the Cameron DWHC hydraulic wellhead connector at the bottom of the BOP unlatched after all it’s been through, even though it is designed to release without over pull.  It’s just been there a long time under severe stress, and don’t forget the torque it suffered as the rig fell, dragging all that riser down with it.  It’s unlikely it will just unlatch and lift off.  Second, if the casing is collapsed at, or just below the casing hanger, then pulling the drill pipe enough to get an ROV under there to cut it will be tricky, if not impossible, and likelihood of it slipping out of the rams while doing that damn likely.  All of this will be done with the well open to the world, and it’s very possible for them to get in a catch 22; can’t pick it up, can’t set it back down, can’t cut the drill pipe.  If the pipe slips out, which is likely, then they could have 20 or 30 feet of damaged drill pipe waving around above the casinghead that will somehow have to be removed.

I know I keep saying it, but what the hell are they doing?  I keep thinking these guys, whether it’s Chu or BP, have some really smart folks advising them, but so far, I’ve witnessed scant evidence of that.  In the presser today Adm Allen said they’re using “an abundance of caution”.   All I can say is that this is an abundance of something, but caution ain’t one of them.

We’ll be watching.

More at The Daily Hurricane Energy page.

This article was originally published on The Daily Hurricane.

Bob Cavnar’s book on the Gulf oil spill, Disaster on the Horizon, will be available in October.

Paul Armentano: Your Tax Dollars at Work

Sunday, August 29th, 2010

Drug Czar Gil Kerlikowske, along with five previous drug czars (including gambling addict William Bennett), have an op/ed in today’s Los Angeles Times condemning California’s Prop. 19.Given that the Drug Czar is required by law to oppose any and all efforts that would seek to legalize marijuana — including “any study … relating to the legalization (for a medical use or any other use) of” cannabis — his vitriol should not come as a surprise. Nevertheless, his commentary clearly begs the question: How is it appropriate for Californians to pay taxes to cover the salary of a federal official who spends a significant part of his time telling these same taxpayers how to vote on a statewide ballot measure?

As far as Kerlikowske’s specific allegations against Prop. 19, suffice to say that you’ve heard them all before — including this whopper, “Law enforcement officers do not currently focus much effort on arresting adults whose only crime is possessing small amounts of marijuana.” (Really? Then how do you explain this? Or this? Or this?)

NORML has already submitted a rebuttal to the L.A. Times. Our allies at Fire Dog Lake also have posted a strong refutation which you can read here. No doubt the headline says it all: “CA Prop 19: Drug Czars’ Latest Anti-Marijuana Propaganda is Easily Refuted.”

Here’s a snippet:

Their argument that a tax on legal marijuana would raise almost no money is just plain silly.

“Regarding the supposed economic benefits of taxing marijuana, some comparison with two drugs that are already regulated and taxed — alcohol and tobacco — is worth considering. People don’t typically grow their own tobacco or distill their own spirits, so consumers accept high taxes on them as retail products. Marijuana, though, is easy and cheap to cultivate, indoors or out, and Proposition 19 would allow individuals to grow as much as 25 square feet of marijuana for ‘personal consumption.’

“Why would people volunteer to pay high taxes on marijuana if it were legalized? The answer is that many would not, and the underground market, adapting to undercut any new taxes, would barely diminish at all.”

I guess the Drug Czars have never heard of convenience before. Most people don’t actually like dealing with criminals or drug dealers. They would rather buy their vodka or marijuana from the liquor store down the street than spend their time tracking down some shady criminal smuggler to save a few bucks on taxes. The end of alcohol prohibition is in fact the perfect test case for this insane theory that legalization would result in almost no decrease of the black market. The reality was an almost immediate destruction of the black market for alcohol. Do you or any of your friends or family currently get liquor on the black market? I doubt it.

It’s a sound response — to which I would add, I guess the Drug Czar has never heard of supermarkets; because last time I checked these facilities had entire sections of the store dedicated to the sale of fruits, vegetables, and plenty of other food stuffs that folks could grow cheaply and easily on their own — but most don’t. Why? For the same reason most marijuana users, even under legalization, won’t likely grow their own pot: they either don’t have the time, the space, or the expertise to do so. And even among those who do — most folks would simply prefer to pay a premium for the convenience of not having had to do it themselves.

As for the rest of the Czar’s rhetoric, it’s simply more of the same and the folks at FDL nail it.

This is what makes the fight to end our war on marijuana so difficult. The other side is not interested in an honest policy debate. Instead of honest argument, they rely on half-truths, distortions, twisted logic, ridiculous statements and naked propaganda. Sadly, America, this op-ed from Kerlikowske and friends is your wasted tax dollars at work.

Paul Armentano wrote this post for NORML, where he serves as the Deputy Director. Along with Mason Tvert and Steve Fox, Paul is the author of Marijuana is Safer, So Why Are We Driving People to Drink?

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Naomi Wolf: Banks Complicit in Fraud—Is it Systemic?

Saturday, August 28th, 2010

Well, just when I thought my ‘Banks Siding Against the Customer in Bank Fraud‘ story couldn’t get any more shocking — it did. I had assumed that when I posted the account this week of how WaMu and now Chase were apparently systematically stonewalling customers — myself included — who had experienced bank fraud, I might hear from a handful of other consumers. I had hoped thus to see if, indeed, as the insider emails that were handed to me by accident by a WaMu official seem to indicate, this practice is systemic, deliberate and driven — as actuary (and bank fraud victim) Geoff Kischuk pointed out to me — by a great deal of profit…for the banks.

I was unprepared, however, for the sheer volume of the stories that readers across America have sent me detailing experiences in which banks collude with fraud, cover it up, protect the identity of the scammer, even from police, or even manipulate customers’ bank accounts themselves. These cover-ups are indeed systemic, highly profitable for the banks, and getting worse.

The stories are heart-wrenching: fraud, and banks’ collusion with it, ruining young people’s credit at twenty-one — no matter how many efforts they make to clear the record; bed-bound, frail elderly being harassed by banks to pay for fraud the banks know has been perpetrated by scammers; and small businesses finding, as actually Geoff Kischuk himself did, that forty, fifty or sixty thousand dollars have vanished electronically from their business accounts — and that they must then fight tooth and nail simply to close the accounts, even as fees rack up.

I had thought I was alone in experiencing a bank — WaMu, and now Chase — that refused to release video of the one writing forged checks on my account, to the police. When I was handed the inside emails by accident, I saw that their fraud department had actually made note of the person’s appearance — one that confirmed details I had given to the police — even as they were telling the police the video did not exist! But to my horror I heard from several other consumers that their banks had done the same thing, even in the face of a police investigation.

I had thought I was alone in having a bank that kept passing fraudulent checks even after I had placed a fraud alert on the account — but several other consumers wrote in confirming that not only had a bank employee opened false accounts in a relative’s name — but after they had called the bank on it, the bank kept clearing their stolen checks!

Well, I certainly now felt less alone — but far more outraged and alarmed, on behalf of all of us, especially those most economically vulnerable; for the big picture, put together, looks far, far uglier than even my own disturbing experience had prepared me to see.

There now appears to be a major business of banks profiting to the point of colluding with fraud (bank fraud and identity theft is over a billion-and-a-half dollar “business” every year); this is made even more alarming because it is so insidious — many banks now manipulate customers’ withdrawals in time sequence and give customers a misleading balance figure that does not show their recent withdrawals. Thus, in both ways, the bank can and does hit the customer with far more overdraft fees. This is not a mini-industry, as I reported earlier this week; I now see this is a mega-industry.

‘Go green!’ urges your bank. But an IT expert wrote me warning that I should let people know that they should not use Windows to do online banking unless they are very computer-savvy: “Banks and mutual funds encourage you to do your finances online because it benefits them but it puts your account at risk,” he cautioned. He directed me to this Washington Post investigation. “This terrifying link explains technologically what happened to Kischuk, to me and so many others: hackers can easily wipe out tens of thousands of dollars from your account, and even cover their tracks; and, since the banks are making so much money from this and other forms of fraud, it is not in their interest to alert you to how easily this is done, once you are banking online.”

Many others who wrote to me have also been charged by their banks for the fraud that the banks know was committed against them. ‘Economike’ encountered fraud — and his bank charged him the legal fees incurred, as well as hundreds of dollars for the fake duplicate ATM card involved. ‘Indyfem’ writes that “A few years ago…someone stole my checkbook from WaMu and wrote a check to themselves for $500.” She notes that the signature looked nothing like hers, and where the amount was supposed to be written in (‘Five hundred and no/100 dollars’) the forger wrote ‘Basketball.’ B UT WAMU cashed the check and then refused to reimburse her. ‘Peacein09′ notes that Chase is now giving him problems in this regard; and indeed, a whole website, Chasesucks.org, has arisen to detail Chase’s mistreatment of customers in these and comparable ways, and to warn them of new scams. ‘Jerrygates’ writes that “WaMu and JPMorganChase have destroyed my confidence in banking…permanently.” He adds,”I do corroborate her [that is, my] citation as sound and truthful. I have been there.” ‘Peacekitten’ had to fight for years to get back the “thousands and thousands over a period of years” wiped out from her account at Wells Fargo.

I thought I was the only one who had ever had to fight to close a corrupted account — but many other consumers had had the same experience. ‘TNLcaller’ also found that “my bank wouldn’t let me close the account” after fraud had been identified. Another reader wrote to me that when she tried to close an account with twenty dollars in it at CitiBank, “they fought me tooth and nail to NOT CLOSE the account…” ‘Davmyy’ wrote that a Wells Fargo (notice any recurrent names, everyone?) banker whom his son knew opened two accounts in his son’s name without his son’s permission, committed fraud, and his son not only got no action from the bank regarding the fraud, which they were not contesting, but later saw the same employee in a new position in another branch!

This to me, in a sense, is the most chilling of the accounts I received, since it dovetails with my own otherwise-inexplicable experience of the bank actively protecting their own employees at WaMu who had kept cashing forged checks on my account for months after I had alerted the bank to the fraud. It may explain the weirdly relaxed tone of “sure, we know that someone messed with this customer’s account, whatever, have a nice weekend” in the insider WaMu emails I received and that Chase is now trying to shrug off. It is stories like this that illustrate the nature of corruption and how it spreads within an organization; you start with passively benefiting from others’ wrongdoing — but if the money is good enough, you develop subtle systems that slowly let you collude more actively in the wrongdoing, the profit, and…the cover-up.

Could it be that policy-approved ‘passive’ stealing or proxy stealing — by enabling fraud to continue, and encouraging customers to switch to an easily hacked bank medium without warning them — is so systemic that banks have, consciously or not, developed a culture of protecting actual thieves in their ranks — thieves who might blow the whistle on all these practices, if called out?

A secondary but still major issue I discovered through readers’ alerts — that of people’s accounts being manipulated by the banks themselves to raise their level of overdraft fees — is so prevalent that that legal firm Zimmerman Reed devotes a whole part of its practice to it now. According to their website, banks are routinely reordering your charges on ATM or debit cards so that the largest comes first, even if you made it last: that is, if you have a hundred dollars in your account, and make purchases of ten, fifteen, thirty, fifty and ninety dollars, the bank will switch the order so that instead of facing one $40 overdraft fee, you face four.

‘Iric’ writes that Chase gave him a balance showing an amount that left out his withdrawals made many days before; he reasonably enough believed the money was there; then they processed the withdrawals, out of order, hitting him for fees. ‘Thmsnnn’ wrote that “I have had similar experiences with delayed credit posts to my account”; this customer has been charged hundreds if not thousands in extra fees in the course of five years. ‘Trgrampictures’ notes that “Wachovia systematically holds deposited checks for up to fourteen days” and that “B of A delays and then accelerates transactions that result in overdraft fees….Wachovia intentionally holds checks too in an effort to initiate overdraft fees.”

Others note that they have not been able to get their banks to show them the rates on their accounts. ‘Harry Wallace’ notes that banks can increase mortgage payments by a few dollars on the anniversary date, but that banks are stealthily raising mortgage payments by twenty or thirty dollars several times a year; he notes that when one makes payments on the principle of a mortgages, it may not be recorded. “And the bank won’t show records unless you are in court.” ‘Joe Dex’ notes that every time you put in to modify a loan, the bank gets $500 — which explains why banks ask you to resubmit the application four or five times. And so on.

Other readers astutely point out something I can confirm in my recent visit to Europe: pretty much every EU bank customer now uses an ATM card with a chip, PIN number and photograph that make it almost impossible for a third party to misuse it (indeed US bank debit cards, without those security systems built in, are not accepted in many places in Europe for that reason, even if it is drawn on a global bank with local branches). Why do we not have access to such secure debit cards here? Why indeed: look to the bank lobby, that influences our legislation in a way it cannot in Europe. Banks in Europe lose, along with the customer, when there is fraud; banks here? It’s a billion plus dollar party annually, and the banks have invited themselves.

It will take quick action to prevent this situation from worsening, especially as banks are now frantically working to skirt new regulations put into place over the past year and a half. Consider potential legislation in Oregon, proposed by the Oregon Bankers Association last session and sent by an industry insider, that would have given fraudulent powers of attorney the benefit of the doubt in fraud claims unless the customer — rather than the bank — could prove fraud had occurred. Needless to say, this is a near impossible task for average consumers. Surely Oregon isn’t the only state where banks have similar ideas (a similar policy also exists in California, per CA probad code Sec. 4303, which allows third parties to rely on anything that appears to be notarized — an easily forged act).

We are up against powerful interests; but just as powerful is knowing the aggregate of all these stories. As awful as it is to learn the truth about the big picture, it is good to warn others — and best of all to know that none of us is alone.

This article was originally published on The Huffington Post.

Naomi Wolf is the author of The End of America, Letter of Warning to a Young Patriot.

The Progressive’s Guide to Raising Hell by Jamie Court, Our Newest Release!

Friday, August 27th, 2010

The Progressive’s Guide to Raising Hell takes you into the “no holds barred” world of activism and campaigning. Your guide is master tactician, consumer advocate and political street fighter Jamie Court. He says the first step of any political battle is to get mad—the last step, never let go. What you do in the meantime, according to the Guide, is hone in on your highest values, publicly point out where your opponents ignore or oppose them, and let the power of public opinion flow your way.

Jamie Court is the President of Consumer Watchdog, an award winning advocacy group that has waged successful campaigns to force regulation of insurance companies, push California to favor privacy protections, and keep oil companies from jacking up gasoline prices. A current project is Inside Google, which is going head-to-head with the internet giant to expose their intrusions on user privacy, collusion with other corporations to erode the freedom of the internet, and generally point out the ridiculousness of their motto, “Don’t Be Evil.”

Watch this video of Jamie Court on the Rachel Maddow Show: “How to Succeed in Business Without Really Lying.”

Listen to Jamie Court’s commentary on NPR’s All Things Considered.

The Progressive’s Guide to Raising Hell is available now…but don’t let your conservative friends borrow it!

Gene Logsdon: Good Agriculture Fosters Good Art, And Vice-Versa

Friday, August 27th, 2010

I’ve written before about my attempts to build a haystack that looks like one in a Claude Monet painting (see links at end of this post). This year I came close, as you can see by the two pictures. The distracting blue plastic at the base of my Monet will eventually be put over the haystack although I think the stack will shed water without a cover as well as Monet’s did. I’m not taking the chance of a sudden 6-inch Midwest downpour ruining it— something I don’t think Monet’s farmers had to put up with. They didn’t build their haystacks inside a ring of woven wire fence either, so I’m cheating a little.

Online, you can find haystacks still being erected all over the world. (Reader Ian Graham has sent me photos of his— he does a good Monet, too.) And as for paintings, good heavens! It appears that almost all artists, right up to the present, feel that they must paint a haystack or a haymaking scene just like so many of them feel compelled to paint nudes at some time in their careers. I typed “hay in art” into Google, and up popped hundreds of hay paintings. Not to be undone by the absence of stacks in modern agriculture, today’s artists are filling their canvases with hay bales including those big round ones wrapped in plastic.

I like to think there is more going on here than just an arty thing. The essence of farming comes down to feeding plants and animals so that they can feed us. Grazing pastures is the most sustainable way for animals to eat and plants to keep growing, as the Great Plains buffalo proved. But in northern climates, that means some of the surplus summer pasture needs to be cut for hay for over winter. This was the most practical way to insure a steady food supply back before farmers went crazy and decided to feed the world with corn and soybeans. People in Monet’s day saw much more than just the beauty of a haystack when they looked at one. They saw survival. As long as haystacks dotted the horizon every fall, society knew that it would survive until the next growing season. I wonder if even today, people look at those hay bales dotting a field and instinctively realize the same thing.

 

Read the rest over at The Contrary Farmer to see how Gene’s busted mower led him to a haystack revelation…

And while you’re at it, take a look at Gene’s newest book, the title of which has to be bleeped when he does radio interviews, Holy Shit, Managing Manure to Save Mankind. You can read Chapter 2 – The Nitty-Gritty of the Shitty, here.

REVIEW: Local Money by Peter North

Thursday, August 26th, 2010

Local currencies are, in effect, “mindful money.” – Rob Hopkins, from the Foreward

I was very excited to get a copy of Peter North’s new book, Local Money.  Here in Los Angeles our local Transition group just piloted a LETSystem, so the financial and currency discussions were fresh in my mind.  I wish I had Peter North’s book back in January when we were trying to figure all these things out!

Local Money: How To Make it Happen in Your Community takes a panoramic view of noteworthy local money from around the world (including some historical systems) and provides a vignette of each one.  There are also vignettes of LETS and time banking, even though these aren’t technically money.

Along the way, Local Money teaches about the lack of resilience in our national currency, regardless of whether that be pound, dollar, or peso.  The book gives a basic introduction to “what is money” – helpful since most of us really don’t understand this.  North briefly touches on alternative financial institutions, and –oh yes– he does mention how to set up a local currency.

Money and finance are complex topics, and I hope this review serves to illustrate the panorama of issues North manages to cover.  But I’m not going to beat around the bush:  Local Money is a tough read.  First of all, it can be emotionally challenging to read about money.  And it’s particularly challenging to read about the bald fact that the monetary systems we have always known are going to need some significant supplementation in order to gain any sort of resilience.  (deep breath.)

Secondly, between the British-isms and the deep financial terminology, even though I have a degree in Business Economics, the reading was quite challenging.  The book could have used less colloquialisms plus a good glossary.  I’ll try to supply some basics so that you can get through this article:

  • National currency – the one you’ve always known.  In the U.S. it’s dollars and cents; in Peter North’s England it’s the British pound and shillings and pence.
  • Alternative currency / complementary currency / local currency – a secondary system designed to parallel the national currency, set up for a specific reason (and Transition isn’t the only reason people set these up).  Examples: Totnes pound, BerkShare.
  • Money – physical things you hold in your hand that are widely embraced as units of exchange.  Examples: a paper dollar bill, a copper penny.  Thus barter, LETS, and time banking aren’t money, even though North doesn’t make that very clear.
  • Barter – simple exchange of goods or services between two people without the use of money.
  • LETS and time banking – basically, sophisticated barter.  Two somewhat-similar systems designed to add greater, community-wide diversity to bartering selections.  In time banking the trades are based on time or hours, and in LETSystems the unit of exchange is defined by the community.
  • Local finance — a broad term that might include local bonds, community investment vehicles, microcredit, land trusts, LETSystems, time banks, and local money.

When you get serious about setting up a local currency, there is a whole new language to learn, including fiat, demurrage, security features, circulation, mutual credit, backed currencies, and more.  You’ll have to weigh each of these characteristics as you design your local system.

Peter North’s Local Money is very useful in that it shows how each of seven or so different alternative currency systems wrestled with these issues, how they succeeded and how they fell short.  In his words, “It’s worth remembering that our local currency models are still in their infancy, more like Wright’s biplane than a Boeing 747.”  In other words, there is no perfect model out there at this point in time for you to copy.  But as North points out …

The [example] of Argentina shows that millions of people can be bounced through the most acute financial crisis with an alternative currency that was flawed, but met short-term emergency needs.

HOW TO

If you are considering setting up an alternative currency for your community, definitely get a copy of Local Money.  But then read it out of order.

North begins with a great introduction to money, its shortfalls, and localization (he uses the British spellings).  Then he gets sidetracked, and plunges into his detailed analysis of specific local currencies, one by one.

For the excellent bullet-point list “Decide why you want to set up a complementary currency,” you’ll have to skip back to page 192, chapter 15.  The How-To chapter is frustratingly brief (a mere 7 sparse pages, or 3% of the book), which kind of calls into question why the book was subtitled as it was.  But Local Money does touch on many of the things you should consider when designing your system.  Once you understand that list of Why points, I think you are better equipped to wade through the specific examples.

One serious shortcoming of the How To section is that it downplays the cost of setting up a local money system.  From what I have seen in my own research, establishing a physical local currency and doing it well – getting a network of businesses involved, printing security features, publicity, etc. — can run $10,000 to $25,000, no small sum.  North never reveals what the three launches of Totnes’ currency cost.  The few cost figures he does mention are not particularly well identified (£5,000 for the Lewes pound or approximately $8,500, sounds like for printing alone; and £6,000 to “produce” the Brixton pound, approximately $10,200).  And he hardly bothers to caution his readers that entree into a Local Money project is diving head-first into the most complex and most expensive end of the local-finance spectrum of solutions.

I’ll highlight his small (buried) caution:

Just because Totnes and Lewes have decided to run a paper currency, that is not necessarily a good reason for following them.  One of the other models of currency, or a new one entirely, might be better.

The “Decide why you want to set up a complementary currency” section can help clarify which model might be the best place for your local community to start.

From our Los Angeles experience, there are many local-finance things a community could do to encourage localization which are far easier and far less expensive to set up.  Some of them may already be happening in your community and your Transition initiative can simply piggyback and help promote their use.  (more on these other sharing solutions later).

DETAILED ANALYSIS OF LOCAL CURRENCIES

North’s list of local currencies is far from exhaustive, but he does seem to hit the major ones that you’ll hear referred to as outstanding examples.  He throws in a few that will probably be unknown to American readers, such as Argentina’s Redes de Trueque of 1997-2003 (literally translates to “barter network” although it did not fit the definition of barter), and German regiogeld (“regional money”).

As said previously, North is quite candid in his review of the successes and mistakes of each local currency.

At the end of each vignette, North presents a graphic “scorecard” which rates that local system for whether it circulates widely or locally; its effectiveness for business exchange versus a community exchange; its “moneyness,” or how closely it looks and works like the national money the public is familiar with.  He also includes a “hard/soft” variable; his application of the terms isn’t making a lot of sense to me no matter how many times I read it.  I would have liked to see a variable on how much it costs to set up that particular type of system, perhaps some scorecard on circulation so we could know if the example was a big system or a small one, and how difficult it is to set up and administer.

One thing that is lacking across all of the alt currency vignettes is a response to the critique I have heard launched at the Totnes pound – its lack of demographic penetration.  North only briefly alludes to the concept of buy-in, which is a significant issue with regards to alt currencies (and his brief mention is buried in the regiogeld section).  Buy-in means you have to purchase your way into the system – thus you have to already have money in order to enter the game.  You have to take your British pounds to the exchange counter and turn them in, in order to buy Totnes pounds.  That means if you are poor or broke and don’t have the disposable income to dedicate to this experimental system, you can’t take part; you are excluded and the alt currency becomes a private club.  A system that requires buy-in will, at the inception, limit itself to the affluent, thus perpetuating some of the diversity issues for which the Transition movement has been criticized.

By contrast, a system without buy-in, such as time banking or LETS, means anyone with an hour to spare – regardless of whether they’re a ditch-digger or a doctor – has the means to participate in the system.  If your local community is quite diverse economically or has high unemployment, buy-in is, in my opinion, a very important issue to consider as you make your decisions about which type of system will be your initial foray into local-financial vehicles.

DEEPENING THE LOCAL FINANCIAL INFRASTRUCTURE

In one particularly brilliant passage, North shares

We can see a LETS scheme or time bank being used for local production and exchange of things we can produce at home or in a local community … More complex goods would be produced by local businesses, perhaps using a local or regional scrip … or a business-to-business exchange.  More local production could be developed using local currency loans, or through a local bank … Special-purpose currencies could finance local food production and Community Supported Agriculture, and local power generation …

He lays out a brilliant vision of multiplicity – that in the future a given community might not have just ONE of these local-finance systems, but several.  Thus the question for you, as you read Local Money, becomes “For my local community, where is it best to start?  Which one should we put in place FIRST?”  I think North gives you a lot of what you should think about in order to answer those questions.  Ultimately, only your local team will know the answer that is right for your community.

In that vein, let me add my own two cents, which is that while North gives a good overview of the most sophisticated portions of the local-finance spectrum, he is writing about local money, not community finances in general.  The scope of his book does not include the low-hanging-fruit — the easy to set up, free to establish vehicles which hold enormous community-building potential.  Group purchasing, garden sharing, carpooling, tool libraries, seed swaps, barter fairs and more – these fill in the most intimate, colorful portion of the spectrum in the vision of a multifaceted local financial infrastructure.

For these, you’ll need to turn to another excellent book, The Sharing Solution by Emily Doskow and Janelle Orsi.  The Sharing Solution covers topics that Local Money does not, and vice versa.  Taken together they create a toolkit to launch your local community toward a complimentary and much more resilient way of handling their everyday transactions.

RESOURCES

  • Local Money is available in the U.S. through Chelsea Green Publishers (They’re the only publisher I know of that has a Transition booklist)

THE PROBLEMS

NON-MONETARY COMMUNITY-BASED FINANCES

  • LETSystems – YouTube explanation from Asheville NC , YouTube example from New Zealand , article explanation.  Open source and potentially free to your community.
  • Older books by Edgar Cahn such as Time Dollars indicate how LETS and time banking could be achieved without computers — a very important criteria for some of our less affluent communities. (see my prior insights on “Diversity and Internet Connections”)
  • Time Banking proprietary software – somewhat “plug and play,” but your community will incur an ongoing fee in U.S. currency — I hesitate to recommend this given the content of the Stoneleigh lecture.
  • Our Los Angeles group’s comparison of barter, time banks, local currencies, and LETSystems (pdf), created prior to the release of Local Money
  • Other sharing techniques – see our Los Angeles examples of the myriad of other ways a community can begin sharing finances, well prior to such giant steps as creating their own Local Money

Joanne Poyourow is a blogger at Transition US.  She is the initiator who brought Transition ideas to many areas of Los Angeles.  She is active on the core team of Transition Los Angeles, and she cofounded its predecessor organization, the Environmental Change-Makers.  Before her involvement in the Transition movement, Joanne was a Certified Public Accountant in public practice, specializing in taxation, multistate business, and expatriate taxation. This article originally appeared on EnergyBulletin.net

Local Money is available in our bookstore.


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