Following on the Solyndra controversy, the Department of Energy under President Barack Obama is now accused of funneling billions of dollars in funding to companies that have connections within the department.
An investigation by The Washington Post found that the Energy Department has approved nearly $4 billion in federal grants and financing to 21 companies supported by firms with connections to five Obama administration staffers and advisers.
Of this amount, $2.46 billion flowed to nine businesses that have ties to VantagePoint Venture Partners, a venture capital firm where Sanjay Wagle, an Energy Department adviser, worked before coming to Washington.
The other four officials identified by the Post include Assistant Secretary David Sandalow, who previously worked for Good Energies, a company that received $737 million from the Energy Department; and Steve Westly, a longtime Silicon Valley entrepreneur and now a member of Energy Secretary Steven Chu’s advisory board. The Westly Group took in $600 million in federal financing.
The Obama administration says that the Energy Department employees and advisers took no part in grant-making decisions, which would mean that these business windfalls were just happy coincidences.
February 16, 2012
Posted by aletho |
Corruption, Progressive Hypocrite | Obama administration, Steve Westly, Steven Chu, United States Department of Energy |
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Why the Feds Won’t Prosecute the Big Wall Street Banks
Yesterday the Department of Justice and 49 state attorneys general announced the long anticipated $25 billion deal with 5 large Wall Street firms — Bank of America Corporation, JPMorgan Chase & Co., Wells Fargo & Company, Citigroup Inc. and Ally Financial Inc. — to settle foreclosure and mortgage servicing abuses. Unfortunately, the settlement is not yet 24 hours old and cracks are emerging.
Each major corruption settlement with Wall Street, and they are legion over the past 15 years, triggers a commemorative magazine cover. I keep some favorites handy.
The October 1996 cover of Registered Representative Magazine, the trade magazine for financial consultants and stock brokers, blared in 48 point bold red type: “How the NASD Was Corrupted.” That issue focused on the years of price fixing of stocks traded on the Nasdaq market by the biggest firms on Wall Street while the self regulatory body, the National Association of Securities Dealers, was dominated by the same firms and looked the other way. (Think SEC today.)
The Department of Justice, then under Janet Reno, had this to say about the settlement: “We have found substantial evidence of coercion and other misconduct in this industry. By providing for the random monitoring of traders’ telephone calls, we expect to deter future price fixing on Nasdaq.” At the time, Reno said the “law does not provide the Department with statutory authority to recover damages or monetary penalties in such cases.”
The next big corruption probe drew a giant green serpent wrapped around the street sign for Wall Street on the cover of BusinessWeek with the rhetorical question: “Wall Street: How Corrupt Is It?” That settlement collectively cost the big firms $1.4 billion for peddling fake stock research to the public to induce investors to buy bad companies while the same analysts called the firms “dogs” and “crap” in internal emails. The announcement of the deal came on April 28, 2003 from the SEC, the New York Attorney General of that day, Eliot Spitzer, the NASD, the New York Stock Exchange and state securities regulators — all gushing over how great this deal was for the public and how it was going to reform Wall Street.
New York Magazine has found an odd way of commemorating the crumbs available to illegally evicted and displaced children and families under the current settlement. The current magazine cover has a Wall Street guy clasping his… uh…private portfolio…with the headline: “The
Emasculation of Wall Street.” If Wall Street is being emasculated, you sure can’t tell it from yesterday’s settlement.
Not only did Wall Street settle its robo-signing, illegal foreclosures and servicing problems with the Department of Justice and 49 state attorneys general (Oklahoma settled independently) but lost in the headlines was that the two major regulators of national banks, the Office of the Comptroller of the Currency (OCC) and the Federal Reserve, also settled with the biggest Wall Street banks in a decidedly cozy deal that effectively lets them off without a monetary fine as long as they pay under the federal-state settlement agreement.
The OCC settled with Bank of America, Citibank, JPMorgan Chase, and Wells Fargo for a combined $394 million but here’s the cozy part: “the OCC agrees to hold in abeyance imposition of such penalties provided the servicers make payments and take other actions under the federal-state settlement with a value equal to at least the penalty amounts that each servicer acknowledges that the OCC could impose…”
The Federal Reserve issued monetary sanctions of $766.5 million against the parent holding companies: Bank of America Corp., Citigroup Inc., Ally Financial, Inc., JPMorgan Chase & Co., and Wells Fargo & Co. and two mortgage servicers GMAC Mortgage, LLC a subsidiary of Ally Financial, Inc., and EMC Mortgage Corporation, a subsidiary of JPMorgan Chase & Co. But again, the Wall Street firms can get off the hook for paying these sums by simply paying them under the $25 billion federal-state settlement.
The specifics of just what the state attorneys general agreed to is unknown, even to some of the attorneys general. According to the web site set up to inform the public about the settlement both the primary “Settlement Document” and the “Executive Summary” will be “coming soon.” Without those documents available for public perusal, there is the reasonable suspicion that the public has once again been feted to lipstick on a pig, as they like to say on Wall Street.
One striking problem is that California Attorney General Kamala D. Harris states on her web site and in this video that California is getting $18 billion. Florida Attorney General Pam Bondi
says on her web site that Florida is receiving $8.4 billion. Those two amounts would leave a negative figure for the other 47 states that agreed to the $25 billion deal.
There’s also something peculiar about the Federal Department of Justice and 49 states setting up an informational web site that ends in .com instead of .gov. Register.com shows the web site has used a privacy shield to block the name of the owner of the site.
Corporate media is reporting that the deal settles only foreclosure and servicing abuses. But this web site states: “The agreement settles only some aspects of the banks conduct related to the financial crisis (foreclosure practices, loan servicing, and origination of loans) in return for the second largest state attorneys general recovery in history and direct relief to distressed borrowers while they can still use it.” The Florida Attorney General concedes on her web site that the deal with the state includes loan origination issues. That may not sit well with residents of a state where massive loan origination frauds occurred.
I called the AG’s office in Massachusetts – historically a tough regulator when it comes to Wall Street. The spokesperson could not answer why loan origination is included on the settlement web site.
Why is mortgage loan origination a big deal? Because tens of thousands of consumers were victimized in a bait and switch racket, believing they were getting a fixed rate mortgage only to find out a few years down the road that they had an adjustable rate mortgage that reset and doubled or even tripled their monthly payment – making it impossible to stay in their home; an effective wealth stripping enterprise by Wall Street against decent, hardworking families across America.
Other abuses in loan origination abounded. The Federal Trade Commission took this testimony from Michele V. Handzel, a former Branch Manager for CitiFinancial, a unit of Citigroup. Ms. Handzel is comparing the practices of CitiFinancial after it acquired another firm, The Associates.
“CitiFinancial put much more pressure on employees than the Associates did to include as many credit insurance and ancillary products as possible on every loan….In fact, I feel that the credit insurance sales practices at CitiFinancial were worse than at The Associates. From January to June 2001, the policy was that no personal loan at CitiFinancial would be approved if it did not include some type of credit insurance, nor would a real estate loan be approved without some type of ancillary product…There were several internal measures in place to effectuate this policy. For instance, District Managers would frequently refuse to send a loan to underwriting if it did not include some type of insurance product. Moreover, loans that were closed and did not include any insurance would be identified by CitiFinancial’s internal insurance auditors, and the employee who closed the loan would be written up…Closings at CitiFinancial resembled those at The Associates – they were brief. Personal loan closings took approximately 10 minutes. Real estate loan closings took a little longer but also did not provide a lot of details about the loan. At CitiFinancial, I was instructed to do a ‘closed folder’ closing, meaning that information would be discussed orally first. Only after the borrower indicated that he wanted to sign would the employee open the folder and have the borrower sign the papers.”
In the past, Wall Street knew it could steal billions and settle with its easily maneuvered regulators for millions. It did this time and time again, never having to admit to any crime. Wall Street translated this to mean that crime was a lucrative profit center. This latest settlement raises the potential of this profit center. Wall Street now understands that it can steal trillions and settle for billions.
And just why is it that the Feds can’t or won’t prosecute the biggest of the Wall Street firms? Because they are the Federal Government’s bond brokers, the primary dealers who contractually agree to buy Treasury bills or notes or bonds at every U.S. Treasury auction. They may be serially corrupt, but Uncle Sam needs those contractual guarantees of its primary dealers to be sure it can pull off its debt auctions. And the U.S. government cannot engage in contracts with convicted financial felons.
And it won’t break up these bloated behemoths because big balance sheets are just what a government with $15 trillion in debt is looking for in a bond broker.
~
Pam Martens worked on Wall Street for 21 years. She spent the last decade of her career advocating against Wall Street’s private justice system, which keeps its crimes shielded from public courtrooms. She maintains, along with Russ Martens, an ongoing archive dedicated to this financial era at www.WallStreetOnParade.com. She has no security position, long or short, in any company mentioned in this article. She is a contributor to Hopeless: Barack Obama and the Politics of Illusion, forthcoming from AK Press. She can be reached at pamk741@aol.com
The Next Financial Crisis Hits Wall Street, As Judges Start Nixing Foreclosures
A Secret Deal Between Wall Street and Washington Shines a Harsh Light on Federal Housing Agency
February 10, 2012
Posted by aletho |
Corruption, Deception | Bank of America, Citigroup, JPMorgan Chase, New York Stock Exchange, Wall Street, Wells Fargo |
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What’s Driving Economic Inequality
Let me begin with the good news. Our nation has tackled this problem before — and successfully so. A century ago, during the original “Gilded Age,” we experienced extremely high levels of inequality, levels comparable to those we are seeing today. Over the span of several decades, policymakers, backed by strong labor unions and other social movements, turned that inequality around. Through fair taxation and effective social programs and standards, we had achieved much lower levels of inequality by the middle of the twentieth century. We had laid the foundation for a strong and stable economy and put in place a middle class that was broader than any the world had ever seen. There is much to learn from that experience.
Executive compensation as a key driver of inequality
The Institute for Policy Studies has particular expertise in one aspect of our nation’s drift into deep and extreme inequality: executive compensation.
For nearly 20 years, we at IPS have been publishing an annual analysis of the upward spiral in CEO pay. Our Executive Excess series has helped track and explain this trend, which has contributed significantly to the rising share of national income that flows to our nation’s top 1 percent. Increases in executive compensation do not tell the whole story behind our growing economic divide, but they do offer an important lens into the broader problem.
Some select indicators of just how disproportionately large rewards for executives have become: The ratio between CEO and worker pay has risen from 42-to-1 in 1980 to 107-to-1 in 1990 to 325-to-1 in 2010.1
Average compensation for S&P 500 CEOs reached $10.8 million in 2010, more than six times the level for large company CEOs in 1980, after taking inflation into account, and triple the level in 1990.2
Executives and financial professionals account for 70 percent of the increase in the share of national income going to the top 0.1 percent between 1979 and 2005.3 Combined compensation for the top five executives by corporate enterprise increased as an average percentage of corporate profits from 5 percent in the period 1993-1995 to nearly 10 percent in the period 2001-2003.4
Why should policymakers be concerned about excessive executive compensation?
1. Excessive compensation encourages executive behavior that harms the broader economy
Over nearly two decades, my colleagues and I at the Institute for Policy Studies have examined how extremely high levels of compensation affect executive behavior. Such massive jackpots, we’ve found, give executives incentives to behave in ways that may boost short-term profits and expand their own paychecks at the expense of our nation’s long-term economic health.
Among our research findings:
- In last year’s annual Executive Excess report, we looked at the intersection between executive compensation and tax dodging. We found that among the top 100 highest-paid CEOs in 2010, 25 had made more in personal compensation than their companies had paid in federal income taxes.5
- In 2010, we found that CEOs of the 50 firms that had laid off the most workers since the onset of the economic crisis had made nearly $12 million on average, 42 percent more than the CEO pay average at S&P 500 firms as a whole.6
- In 2009, we found that the top five executives at the 20 banks that had accepted the most federal bailout dollars had averaged $32 million each in personal compensation during the three years leading up to the 2008 meltdown.7
- In 2004, we found that CEOs at companies which had outsourced the most U.S. jobs to other countries were rewarded with bigger paychecks than their peers. Average CEO compensation at the 50 firms that had outsourced the most service jobs increased by 46 percent in 2003, compared to a 9 percent average increase for all large company CEOs. Top outsourcers earned an average of $10.4 million, 28 percent more than the average CEO compensation of $8.1 million.8
- In 2002, we found that top executives at 23 companies under government investigation for their accounting practices had earned far more during the preceding three years than average CEOs. CEOs at the firms under investigation had earned an average of $60.1 million during 1999-2001, 65 percent more than the average of $36.5 million for all leading executives for that period.9
Tax dodging, mass layoffs, reckless financial deals, offshoring jobs, “creative accounting”—all of these appear to boost CEO pay. But they have dealt one body blow after another to the American middle class, leaving a deeply skewed distribution of income and wealth.
2. Extreme CEO-worker pay gaps undermine business enterprise effectiveness
Our nation’s long-term economic health depends to a great extent on the effectiveness of our U.S. enterprises. A growing body of research indicates that extreme inequality within firms leaves enterprises less productive and effective. A Stanford University review of several studies found that organizations with highly differentiated pay between top and bottom earners tended to experience a decline in employee morale and job satisfaction.10 Another study showed that in corporations with relatively narrow pay gaps, employees tended to produce higher quality products.11 Additional research indicates that wide pay gaps lead to higher employee turnover rates.12
John Mackey, CEO of Whole Foods, limits his cash compensation to no more than 19 times the average for workers at his firm. In the Harvard Business Review, he wrote “Because of the yawning gap between the leaders and the led, employee morale is suffering, talented performers’ loyalty is evaporating, and strategy and execution is suffering at American companies.”13
Peter Drucker, the father of modern management theory, pointed out in the early 1980s that in any hierarchy, every level of bureaucracy must be compensated at a higher rate than the level below. The more levels, the higher the pay at the top. This gives CEOs a personal interest in maintaining rigid hierarchies that are disempowering for workers. Drucker’s solution was to limit executive pay to no more than 20 times the compensation of their employees.14 A landmark Brookings Institution report by David Levine supported this general view, stating “large differences in status can inhibit participation.”15
Jim Collins, the author of several best-selling books on management science, spent five years trying to determine “what it takes” to turn an average company into a “great” one. He eventually identified 11 firms that had successfully generated off-the-charts stock returns over 15 years. Not a single one had a high-paid CEO. A celebrity CEO, Collins wrote, turns a company into “one genius with 1,000 helpers.”16
Recent reforms to address excessive executive compensation
Executive pay is not just an issue for shareholders. As the Wall Street meltdown made vividly clear, excessive pay packages contribute to a reckless corporate culture that endangers the well-being of the broader public. Responsible action is needed to encourage more rational pay practices.
Dodd-Frank Pay Reforms: In the wake of the 2008 crash, Congress did include a number of modest executive compensation provisions in the Dodd-Frank financial reform bill. One of the most innovative of these provisions, Section 953b, requires all U.S. corporations to compute and report the ratio between CEO and median employee pay. This disclosure requirement will improve information available for shareholders and the public on a metric fundamental to enterprise success. Hopefully, it will also encourage corporate boards to narrow this gap by raising median worker pay and/or reducing pay at the top.17
However, in the face of an intense backlash from corporate lobby groups, the SEC has delayed implementation of this new law. Regulators are facing strong pressure to water down several additional Dodd-Frank pay provisions, including Section 956, which would give regulators the power to prohibit pay packages for financial executives that encourage inappropriate risks.
Limits on the Tax Deductibility of Executive Pay: Congress also set an important precedent in the Troubled Asset Relief Program by establishing a $500,000 cap on the tax deductibility of executive compensation at bailout firms. A similar provision was included in the 2010 health care reform legislation with regard to health insurance companies. These provisions took an important step towards filling a loophole in the tax code that encourages excessive pay.
Currently, there are no meaningful limits on how much corporations can deduct from their taxes for the expense of executive compensation. The more they pay their CEO, the more they can deduct from their taxes. Other taxpayers bear the brunt of this loophole, either through the increased taxes needed to fill the revenue gaps or through cutbacks in public spending. A tax deductibility cap on executive compensation should be established for all corporations. Ideally, it would deny all firms tax deductions on any executive pay that runs over 25 times the pay of a firm’s lowest-paid employee or $500,000, whichever is higher.
A broader agenda to reverse extreme inequality
While Congress has made some small steps forward in recent years, much more needs to be done to rein in executive pay, as part of a broader effort to reverse extreme inequality. This broad agenda will need to include initiatives to lift up the bottom through living wages and more accessible high-quality health care and education, as well as efforts to address corporate concentration, campaign finance laws, and other obstacles to shared prosperity. But a look back at the previous era’s efforts to tackle inequality reveals that one of those reformers most important tools was progressive taxation.
In the middle of the last century, the U.S. tax system did a great deal to offset maldistributions of income and wealth. A major reason corporate boards did not compensate executives at such exorbitant levels during that period was that the bulk of that excessive pay would have simply been taxed away.
During the 1950s and early 1960s, the top marginal tax rate on income over $400,000 a year (the equivalent of less than $3 million today) faced a tax rate just over 90 percent. During that time, the share of the nation’s total pre-tax income going to the top 1% hovered around 10 percent, according to one academic study.18 As taxes on the wealthy have declined over the past 50 years, we’ve seen a steady increase in wealth and income concentration at the top. Today, with a top marginal rate of only 35 percent, the top 1% enjoy more than 20 percent of the nation’s income.19 Not only did the “high-tax” decades coincide with lower inequality rates, they were also marked by relatively high GDP growth rates.
A recent report by the Congressional Budget Office found similar trends towards rising inequality in after-tax income during the period 1979-2007. According to their calculations, the top 1 percent of the population with the highest income saw an increase in their average real after-tax household income of 275 percent during this period, compared to only 65 percent for the rest of the highest quintile (the 81st through 99th percentiles); 37 percent for the population in the middle of the income scale (the 21st through 80th percentiles); and 18 percent for the lowest quintile.20
Preferential treatment and loopholes have allowed the richest Americans to pay far less than the statutory tax rates. The richest 400 U.S. taxpayers have seen their effective tax rate decline from over 40 percent of their income in 1961 to just 18.1 percent in 2010.21 In 2009, the most recent data available, 1,500 millionaires paid no income taxes, largely because they made use of off-shore tax schemes, according to the Internal Revenue Service.22
Key elements of tax reform to reverse extreme inequality
This section draws heavily from the forthcoming book by my Institute for Policy Studies colleague Chuck Collins, 99 to 1: How Wealth Inequality is Wrecking the World and What We Can Do About It (Berrett-Koehler, March 2012).
New income tax brackets for the 1 percent. Under our current tax rate structure, households with incomes over $350,000 pay the same top income tax rate as households with incomes over $10 million. In the 1950s, there were 16 additional tax rates over the highest rate (35 percent) that we have today.
A tax on financial speculation. The richest 1 percent of Americans contributed to the 2008 economic meltdown by moving vast amounts of wealth into the speculative shadow banking system. Our society is still paying the mammoth social costs of this meltdown — through home foreclosures, unemployment, and the destruction of personal savings. A modest federal tax on every transaction that involves the buying and selling of stocks and other financial products would both generate substantial revenue and dampen short-term speculation. For ordinary investors, the cost would be negligible. A financial speculation tax would amount to a tiny insurance fee to protect against financial instability.
A higher tax rate on income from wealth. Giving tax advantages to income from wealth also encourages short-term speculation. With carefully structured rate reform, we can end this preferential treatment for capital gains and dividends and, as Warren Buffett and other analysts have noted, encourage long-term investing.
A progressive estate tax on the fortunes of the 1 percent. The wealthiest Americans have all benefited from generations of investments in pubic goods that have left the United States with an infrastructure — in everything from education and roads to dispute resolution — that enables wealth creation. Our wealthy have a responsibility to give back to the society that has given them so much. The current estate tax on inherited wealth stands at 35 percent and only applies to estates over $5 million ($10 million for a couple). Congress could raise additional revenue from those with the greatest capacity to pay by establishing a progressive estate tax with graduated rates and a 10 percent surtax on the value of an estate above $500 million, or $1 billion for a couple.
An end to tax haven abuse. By one estimate, the use of tax havens by corporations and wealthy individuals costs the federal treasury $100 billion a year.23 These havens are transferring wealth out of local communities into the foreign bank accounts of the world’s wealthiest and most powerful.24 Tax havens, or more accurately “secrecy jurisdictions,” can also facilitate criminal activity, from drug money laundering to the financing of terrorist networks.
A wealth tax on the top 1 percent. A “net worth tax” could be levied on household assets, including real estate, cash, investment funds, savings in insurance and pension plans, and personal trusts. Such a tax could be calibrated to tax wealth only above a certain threshold. For example, France’s solidarity tax on wealth only kicks in on asset value in excess of $1.1 million.
The elimination on the cap on social security withholding taxes. Extending the payroll tax to cover all wages, not just wage income up to $110,100, would be an important step. Some of our richest Americans are done paying withholding taxes in January, while ordinary working people pay all year.
Conclusion
Our current levels of extreme inequality did not suddenly appear. They have grown steadily over the past 30 years. Reversing this inequality trend will be a long-term challenge. But we have transformed a highly divided nation into a more stable and equitable society before. We can certainly do it again.
Sarah Anderson is director of the Institute for Policy Studies’ Global Economy Project.
NOTES
1 Figures from 1980 and 1990 are from BusinessWeek, April 26, 1993. Figure for 2010 is from Sarah Anderson, Chuck Collins, Scott Klinger, Sam Pizzigati, “Executive Excess 2011: The Massive CEO Rewards for Tax Dodging,” Institute for Policy
2 Ibid.
3 The share of national income (excluding capital gains) received by the top 0.1 percent increased from 2.83 percent in 1979 to 7.34 percent in 2005. Source: Jon Bakija, Adam Cole, and Bradley T. Heim, “Jobs and Income Growth of Top Earners and the Causes of Changing Income Inequality: Evidence from U.S. Tax Return Data,” National Bureau of Economic Research, October 2010. Available at: http://www.nber.org/public_html/confer/2010/PEf10/Bakija_Heim_Cole.pdf
4 Lucian A. Bebchuk and Yaniv Grinstein, “The Growth of Executive Pay,” Oxford Review of Economic Policy, Summer 2005. Available at: http://www.law.harvard.edu/faculty/bebchuk/pdfs/Bebchuk-Grinstein.Growth-of-Pay.pdf
5 Sarah Anderson, Chuck Collins, Scott Klinger, and Sam Pizzigati, “Executive Excess 2011: The Massive CEO Rewards for Tax Dodging,” Institute for Policy Studies, August 31, 2011. Available at: http://www.ips-dc.org/reports/executive_excess_2011_the_massive_ceo_rewards_for_tax_dodging/
6 Sarah Anderson, Chuck Collins, Sam Pizzigati, and Kevin Shih, “Executive Excess 2010: CEO Pay and the Great Recession,” Institute for Policy Studies, September 1, 2010. Available at: http://www.ips-dc.org/reports/executive_excess_2010
7 Sarah Anderson, John Cavanagh, Chuck Collins, and Sam Pizzigati, “Executive Excess 2009: America’s Bailout Barons,” Institute for Policy Studies, September 2, 2009. Available at: http://www.ips-dc.org/reports/executive_excess_2009
8 Sarah Anderson, John Cavanagh, Chris Hartman, and Scott Klinger, “Executive Excess 2004: Campaign Contributions, Outsourcing, Unexpensed Stock Options and Rising CEO Pay,” Institute for Policy Studies, August 31, 2004. Available at: http://www.ips-dc.org/reports/executive_excess_2004
9 Sarah Anderson, John Cavanagh, Chris Hartman, Scott Klinger, and Holly Sklar, “Executive Excess 2002: CEOs Cook the Books, Skewer the Rest of Us,” Institute for Policy Studies and United for a Fair Economy, August 26, 2002. Available at: http://www.ips-dc.org/reports/executive_excess_2002_ceos_cook_the_books_skewer_the_rest_of_us
10 Jeffrey Pfeffer, “Human Resources from an Organizational Behavior Perspective: Some Paradoxes Explained,” Journal of Economic Perspectives, Vol. 21, 2007. Available at: http://pubs.aeaweb.org/doi/pdfplus/10.1257/jep.21.4.115
11 Douglas Cowherd and David Levine, “Product Quality and Pay Equity Between Lower-Level Employees and Top Management,” Administrative Science Quarterly, Vol. 37, 1992. Available at: http://findarticles.com/p/articles/mi_m4035/is_n2_v37/ai_12729185/
12 Matt Bloom and John Michel, “The Relationships Among Organizational Context, Pay Dispersion, and Managerial Turnover,” Academy of Management Journal, 2002. Available at: http://www.jstor.org/pss/3069283 See also James Wade, Charles O’Reilly III and Timothy Pollock, “Overpaid CEOs and Underpaid Managers: Fairness and Executive Compensation,” Organization Science, 2006. Available at: http://test.scripts.psu.edu/users/t/x/txp14/pdfs/os06.pdf
13 John Mackey, “Why Sky-High CEO Pay Is Bad Business,” Harvard Business Review, June 17, 2009. Available at: http://blogs.hbr.org/hbr/how-to-fix-executive-pay/2009/06/why-high-ceo-pay-is-bad-business.html
14 Peter F. Drucker, The Changing World of the Executive. New York: Times Books, 1982, p. 22.
15 David I. Levine, Reinventing the workplace: how business and employees can both win. Brookings Institution Press, April 1, 1995, p. 53.
16 Jim Collins, “Good to Great,” Fast Company, October 2001. Available at: http://www.jimcollins.com/article_topics/articles/good-to-great.html
17 See: Institute for Policy Studies Comments to the SEC on Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, March 16, 2011. Available at: http://www.sec.gov/comments/df-title-ix/executive-compensation/executivecompensation-62.pdf
18 Thomas Piketty and Emmanuel Saez, “Income Inequality in the United States, 1913-1998,” Quarterly Journal of Economics, 118(1), 2003. Updated at http://emlab.berkeley.edu/users/saez.
19 Ibid.
20 Congressional Budget Office, “Trends in the Distribution of Household Income Between 1979 and 2007,” October 2011. Available at: http://www.cbo.gov/ftpdocs/124xx/doc12485/10-25-HouseholdIncome.pdf
21 Sam Pizzigati, “The New Forbes 400— and Their $1.5 Trillion,” Institute for Policy Studies, September 25, 2011. Available at: http://inequality.org/forbes-400-15-trillion.
22 Amy Bingham, “Almost 1,500 millionaires Do Not Pay Income Tax,” ABC News, August 6, 2011. Available at: http://abcnews.go.com/Politics/1500-millionaires-pay-income-tax/story?id=14242254#.TrwQYWDdLwN
23 U.S. Senate, “Tax Haven Banks and U.S. Tax Compliance,” Staff report, Permanent Subcommittee on Investigations, July 17, 2008. See: http://hsgac.senate.gov/public/_files/071708PSIReport.pdf
24 Nicholas Shaxson, Treasure Islands: Uncovering the Damage of Offshore Banking and Tax Havens, 2010. See: http://treasureislands.org/
This article is adapted from Sarah Anderson’s testimony to the Senate Budget Committee on Inequality, Mobility, and Opportunity, from Sarah Anderson, Global Economy Program Director
February 9, 2012
Posted by aletho |
Corruption, Economics, Timeless or most popular | Dodd–Frank Wall Street Reform and Consumer Protection Act, Executive pay |
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Why Geo-Engineering Is Like the F-35 Joint Strike Fighter
By FRANKLIN C. SPINNEY | February 9, 2012
A February 6 report in the Guardian describes budding efforts to displace decarbonizing with geo-engineering as the goal for reducing the predicted catastrophic effects of global warming. At present, these efforts are being funded by mega-wealthy private citizens like Bill Gates, but some traditional environmentalists as well as some decarbonizers are becoming worried that climate theory is setting off in a new direction. Perhaps that is why the story appeared in the Guardian of all places. Instead of its usual uncritical climate gushiness, the Guardian delves into the smarmier side of climate science — its dependence on money.
Their dependence on money is a subject proponents of anthropogenic global warming avoid like the plague, even though they are wont to accuse anyone who disagrees with them as being in the pay of the fossil fuel companies. The Guardian report is important, because it inadvertently shines a light on how the intersection of money and groupthink among insular cohesive groups sharing a common interest is discrediting climate science in particular, but also science in general. (I am not introducing groupthink as a casual buzz word but in the context the distinguished psychologist Irving Janis used in his classic book Groupthink. Anyone who believes groupthink is not a problem in the insular self-righteous climate science community, should read the Hockey Stick Illusion or wade through just a few of the infamous emails hacked from the Climate Research Unit at the University of East Anglia.)
Obviously, geo-engineering the earth’s climate would be a big deal, culturally as well as scientifically. It would make the pyramids, the Manhattan Project or the Apollo Program look puny and intellectually trivial in comparison. By necessity, indeed by definition, geo-engineering would be forever dependent on analyses of the outputs of computerized global climate models (GCMs), because we can not put anything as complex as the world’s atmosphere on a lab bench or in a wind tunnel for testing. Computer models, like all scientific theories, are mental constructs of reality — really analogies — to represent and cope with that reality. The first point to note is that no model can be perfect or exact in its representation of reality. All models are imperfect and therefore mutable, as the historian Thomas Kuhn, among others, explained in his classic, The Structure of Scientific Revolutions. All scientific models must be continually tested to ensure their predictions match up to external conditions, and as the precision of observations increases, sooner of later, all scientific models become creaky and eventually need to be replaced with a newer construction to better explain a reality that is always receding as one seems to get closer to it by making more precise observations.
The second point to note is that GCMs are complex mathematical constructs made by like-minded or group-thinking minds. They are not the products of individuals. This requires a consensus-based mentality and the intense communal effort required to build these models reinforces that mentality. The need to raise money to pay for these models further intensifies the communal outlook. Consensus building, and especially the invocation of consensual authority, shapes the mentality of contemporary climate scientists in a very different way from the conceptions of physics that shaped the individual mental outlooks during the experiments that produced the models of the atom that competed for acceptance during the first half of the twentieth century. The great physicist who invented the first model of the atom, Niels Bohr, for example, used to introduce his lectures by saying everything he was about to say was wrong. By that he meant no theory is eternal.
You will not hear Bohr’s kind of humility, tolerance, or encouragement of dissent and debate from dogmatic proponents of global warming like Michael Mann or James Hansen, ironically, both physicists, even though the GCMs they are basing their sense of authority on have not been validated with empirical data (or in the case of Mann’s infamous Hockey Stick, have been shown to be statistically flawed). The dogmatic sense of certainty exhibited by goupthinking climate scientists exists despite the fact that the comprehensive data needed to test the GCM models for matchups to the environment simply do not exist. Yet, this uncertainty is not at all unlike that which created the far more open-minded debate among the advocates of different atomic models, like Bohr, Schrödinger, or Heisenberg in the early Twentieth Century. So, the authority of the GCMs needed to justify geo-engineering must be based on unvalidated assumptions about reality — really conjectures which are now stated as dogma, like, for example, the crucial quantification of the sensitivity of the warming response to changes in CO2 levels.
But there is more to the speculative analytical pathway leading climate science into the geo-engineering cul de sac, which brings me to my third point. To justify the huge public expenditures and diversion of resources needed to geo-engineer the world, it will be necessary to perform cost-effectiveness analyses of the predicted benefits in a political context to convince policy makers of the need to undertake such a drastic and costly course of action. Although the Guardian does not mention it, I have met some global warming alarmists (all card-carrying decarbonizers) who are already advocating that we combine the output of the GCMs with econometric models of the global economy to predict the global relationship between the monetary inputs to the economic benefits of global temperature reduction via solutions like carbon sequestration, etc. If you want to know how accurate econometric models are, just ask Alan Greenspan. This kind of operation, clearly, would be like piling a house of cards on top of a house of cards.
Yet, the econometric-GCM mansion of cards is probably inevitable. It is a tiny logical step for advocates of geo-engineering to link their theoretical GCMs to econometric models, and given the money needed (and the sacrifices that would be made elsewhere), cost-benefit analyses will eventually become necessary. A policy decision to launch a “Manhattan Plus” project to geo-engineer the earth’s climate based on analyses of the output of such poorly understood computer models (GCMs and econometric) would go beyond madness and descend into megalomania. The Guardian report inadvertently makes the madness quite clear: some climate scientists are calling for a political consensus to geo-engineer the globe, because the world cannot reach a political agreement on the vastly simpler problem of simply reducing carbon emissions. Such an argument is at once illogical and bizarre. Perhaps this yawning disconnect is why this report appeared in the Guardian, usually the most rabid pro global-warming mainstream newspaper in the world.
But of course, the megalomania implicit in geo-engineering has nothing to do with madness; it is about a group of like-minded intelligent people trying to feather their nest by creating a cash cow to do what they think is right and good. This is something I saw every day in the Pentagon.
Indeed, creating cash cows in the name of the greater good is the essence of the Pentagon’s game. My 28 years experience in the Pentagon made me quite familiar with the steps needed to create the financial equivalent of a self-licking ice cream cone: (1) Inflate a threat to scare the bejeezus out of the people and induce politicians to unleash a torrent of publicly-funded money; (2) then, front-load a solution to neutralize that threat by overstating its benefits, understating its costs, and downplaying the uncertainties surrounding what is at best a poorly understood course of action; and then, (3) politically engineer a social safety net by spreading the money (grants and contracts) around the polity to lock in the constituent dependencies needed to keep the money flowing after the inevitable problems begin to surface.
Incidentally, the geo-engineering game, if publicly funded, will be manna from heaven for the US hi-tech weapons industry, which cannot compete commercially, but is in need of diversification, because of marginal cutbacks in the rate of future growth in the Pentagon’s budget. You can bet what little is left of your IRA that defense mega-giants like Boeing, Lockheed Martin, and Northrup Grumman will be attracted to the cash flow potential of geo-engineering like flies to honey, should a serious geo-engineering effort begin to materialize.
Speaking of the similarities between the advocates of geo-engineering to the inhabitants of the Pentagon and the defense industry — consider, as an example, the resemblance of using computer simulations to cope with the uncertainties of geo-engineering to the use of computer simulations in the now deeply troubled F-35 Joint Strike Fighter program. Bear in mind, the Pentagon wrote the script for basing high-cost decisions with long term consequences on highly complex, poorly-understood computer driven simulations, while short-shrifting testing. It has more experience in modeling than just about any organization in the world. It began cost-effectiveness modeling on computers in the mid 1960s and has continued with increasing intensity ever since. Nevertheless, the unfolding debacle of the F-35 has taken these kinds of simulations to a new level of disaster: No less an authority that Frank Kendall, the acting Under Secretary of Defense for Acquisition said recently that the F-35 program was started with the idea of putting it into production before it was fully tested under ”the optimistic prediction that we were good enough at modeling and simulation that we would not find problems in flight test.” … He characterized this decision as “acquisition malpractice” … that … “was wrong, and now we are paying for that.” Of course, Kendall’s use of “we” is a wee bit disingenuous, because it is the taxpayer not the Pentagon who is footing the malpractice bill.
It goes without saying that the uncertainties limiting our understanding of our ability to model the future consequences of a decision to design and produce the F-35 are trivial compared to those of geo-engineering the entire climate system. But humility is not in order, because geo-engineers, like milcrats and defense contractors, will be spending other people’s money.
FRANKLIN “CHUCK” SPINNEY is a former military analyst for the Pentagon. He currently lives on a sailboat in the Mediterranean and can be reached at chuck_spinney@mac.com
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February 9, 2012
Posted by aletho |
Corruption, Environmentalism, Science and Pseudo-Science, Timeless or most popular | FRANKLIN C. SPINNEY, Geoengineering, Global climate model, Global warming, Hockey Stick Illusion, Niels Bohr, University of East Anglia |
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In a sneering report on the Egyptian investigation into foreign “democracy-promoting” NGOs, the Wall Street Journal opines:
In describing their evidence, most of which came from raids on the NGO offices in late December, the judges seemed to allude to a well-worn Egyptian conspiracy theory, often peddled by populist politicians, that the U.S. hopes to stoke sectarian conflict in Egypt as a prelude to an armed invasion.
The justices said they had found maps of Egypt marked with four divisions—a thinly veiled reference to supposed American plans to divide the country into competing religious and ethnic fiefdoms.
It appears that the writer is not familiar with the Yinon Plan. Back in 1982, Israeli strategist Oded Yinon wrote “A Strategy for Israel in the 1980s,” which advocated the dissolution of all existing Arab states along ethnic or sectarian lines:
Egypt, in its present domestic political picture, is already a corpse, all the more so if we take into account the growing Moslem-Christian rift. Breaking Egypt down territorially into distinct geographical regions is the political aim of Israel in the Nineteen Eighties on its Western front. Egypt is divided and torn apart into many foci of authority. If Egypt falls apart, countries like Libya, Sudan or even the more distant states will not continue to exist in their present form and will join the downfall and dissolution of Egypt. The vision of a Christian Coptic State in Upper Egypt alongside a number of weak states with very localized power and without a centralized government as to date, is the key to a historical development which was only set back by the peace agreement but which seems inevitable in the long run.
Two of the NGOs — the International Republican Institute and the National Democratic Institute — are affiliated with the National Endowment for Democracy, which also funds a third, the International Center for Journalists. Carl Gershman, the longtime president of the National Endowment for Democracy, formerly worked in the “research department” of the pro-Israel Anti-Defamation League. The fourth NGO, Freedom House, has no shortage of pro-Israelis on its board of trustees, including its vice-chair, former AIPAC executive director, Thomas Dine.
Perhaps the Egyptians have good reason to be wary of so many Israel partisans “promoting democracy” in their country.
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Egyptians oppose US economic aid, says Gallup
February 9, 2012
Posted by aletho |
Corruption, Deception, Timeless or most popular, Wars for Israel | Carl Gershman, Egypt, National Endowment for Democracy, Non-governmental organization, Thomas Dine, Wall Street Journal |
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President Obama is like comedian Flip Wilson’s character, Geraldine: He blames everything on the Devil. The Devil made him do it.
And so, the Devil has just forced Mr. Obama to put together his own infernal Super Pac, the demon-spawn of the Supreme Court’s Citizen’s United decision allowing corporations and wealthy individuals to spend as much money as they like on elections. Only days ago, Obama was calling Super Pacs a “threat to democracy,” but that was then, and now it’s time to make sure that the president has an equal opportunity to join in the corruption. But, don’t blame Obama. The Koch brothers made him do it, with reports that the far-right siblings plan to gather $100 million in Super Pac money. As Geraldine would say, those Koch Devils made Obama do it.
Not that there’s any danger of Obama being outspent in his re-election bid. He’s raised more money than all the Republican candidates, combined. In fact, he’s raised a lot more money from employees of Mitt Romney’s private equity firm, Bain Capital, than Romney has. All indications are that Obama will win the race for Wall Street’s campaign contributions, hands down, no matter who the Republicans nominate, just as Wall Street preferred Obama to John McCain, four years ago.
Candidate Obama opted out of public financing in the 2008 campaign, the first president since Watergate to run without public funding. He had earlier promised to accept public financing, and the limits on spending that go with it, if McCain did. McCain kept his part of the bargain, but Obama was getting more money than he could bring himself to turn down. In fact, by that time, Obama had raised twice as much as McCain, so he couldn’t claim a disadvantage. Instead, Obama’s excuse was that the public financing system was “broken.” But, of course, it was Obama’s withdrawal that definitively broke the system, paving the way for the billion dollar election of 2012.
In the summer of 2007, Obama explained the difference between himself and all of his Democratic and Republican opponents, when it comes to taking money from the rich and greedy. “The argument is not that I’m pristine, because I’m swimming in the same muddy water,” he said. “The argument is that I know it’s muddy and I want to clean it up.” But there is no evidence that Obama wants to clean up campaign financing, only that he finds all kinds of excuses to take the money.
The Wall Street crowd loves Obama, and they show it with their checkbooks. He returns their love a thousand times over, by protecting their interests while skillfully hoodwinking the Democratic base into believing that he’s on their side. The most pitiful marks in this hustle are small contributors, who Obama claims are his real base of support. Back in 2008, he even claimed that his fundraising was a better reflection of democracy than public financing, because he had so many small contributors. But it turns out that Obama got almost exactly the same proportion of his campaign funds from the little guys as George Bush did, in 2004.
It’s a rich man’s game, in which the future of the country and the world is purchased cheaply with campaign contributions. It is common sense that the player that collects the most money, has also sold the most influence. This election year, just like last time, the top influence seller is Barack Obama.
Glen Ford can be contacted at Glen.Ford@BlackAgendaReport.com.
February 8, 2012
Posted by aletho |
Corruption, Progressive Hypocrite | John McCain, Mitt Romney, Obama, Political action committee, Wall Street |
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Lebanon’s security officials say a suspicious cargo containing huge amounts of US dollars, guns, special passports and credit cards have been seized upon arrival in the Lebanese capital, Beirut, from the US and Brazil.
The items, packed in a number of chests and delivered via airmail, were discovered at Beirut’s airport, the Lebanese security officials said.
The chests also contained a list of both well-known and ordinary Lebanese citizens including a figure related to Salafi extremist groups. The security officials have summoned a number of the individuals, whose names were on the list, arresting some of them.
Beirut has redoubled security surveillance across the country following remarks by some Lebanese factions as well as widespread rumors about the presence of al-Qaeda in Lebanon.
Meanwhile, the Lebanese defense minister earlier confirmed that members of the al-Qaeda terrorist group, fighting against the government of Syrian President Bashar al-Assad, have entered Syria through Lebanon.
Over the past few months, reports have circulated that caches of weapons have been smuggled to armed gangs in Syria through the Lebanese border.
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February 7, 2012
Posted by aletho |
Corruption, Timeless or most popular | al-Qaeda, Lebanon, Syria |
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CAIRO: A new poll published by Gallup revealed that some 70 percent of Egyptians surveyed oppose United States economic aid to Egypt. The poll, conducted in December 2011, also said that Egyptians are against direct aid to civil society organizations in the country.
“This rebuke of US financial support may be a challenge for Egypt’s newly elected parliament and its future president as the government attempts to bolster the nation’s financial stability,” wrote Gallup in their report published on Monday.
Egyptians were not against international economic assistance altogether, however, showing signs of support from international aid groups.
Gallup reported that around 50 percent of the country favoring aid and assistance from international institutions.
Egypt’s ruling military junta and the interim government appointed by the Supreme Council of the Armed Forces (SCAF) had initially rejected assistance from the International Monetary Fund (IMF), but has since reversed their opposition.
Last month, Masood Ahmed, Director for the Middle East and Central Asia Department for the IMF, was in Egypt to discuss a potential $3.2 billion IMF loan to Egypt.
“Egyptian leaders’ ability to attract foreign aid and investment will be important to collecting the capital needed to move the nation’s economy forward,” Gallup continued.
Civil society groups have received tens of millions of dollars from the US since the January 2011 uprising ousted President Hosni Mubarak, but in the past month, the military rulers have cracked down on local and international NGOs, sending some 43 employees to a criminal court on Sunday to face charges for illegal funding.
Among those sent are 19 Americans, 5 Serbians, two Germans, three Arabs and the remaining Egyptians. Sam LaHood, the son of US Transportation Secretary Ray LaHood, who has made headlines recently after being barred from leaving Egypt, was among those charged.
The spat over American citizens being barred from leaving Egypt has left a diplomatic row between the military junta here in Egypt and the American government.
A senior State Department official said last week that a “handful of US citizens have opted to stay in the embassy compound in Cairo while awaiting permission to depart Egypt.”
The official, who was not allowed to discuss the matter on the record, would not say whether Sam LaHood, the son of Transportation Secretary Ray LaHood, was among those at the embassy.
LaHood said last week that he fears he could be jailed for up to five years after being barred from leaving the country earlier this month.
“As Egypt’s new parliament begins its work and the country’s citizens prepare for presidential elections, many Egyptians are suffering from the day-to-day realities of unemployment and price inflation. According to Gallup’s most recent survey in December 2011, Egyptians are most likely to name inflation and lack of money as the biggest problem facing their families; the second is lack of jobs,” added the report on the implications for Egypt’s future.
February 6, 2012
Posted by aletho |
Corruption, Deception, Timeless or most popular | Egypt, Sam LaHood, Supreme Council of the Armed Forces |
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Hundreds of protesters in Los Angeles have taken out to the streets of Hollywood to rally against loopholes in legislation on corporate tax in the United States, Press TV reports.
The protesters, including unemployed workers, members of labor unions and “Occupy LA” activists, staged the rally to show their anger at a recent report showing that 249 of the country’s largest and most profitable corporations paid less than the US corporate tax rate.
The protesters said local communities are unable to afford vital public services such as health care and services provided by police officers, fire fighters due to the failure of these rich corporations to pay their fair share of taxes.
Demonstrators occupied one of Hollywood’s busiest intersections, forcing police to order them to disperse. Protesters say the display was necessary to make sure people understand what is going on in the US.
Jacob Hay, one of the organizers of the rally, told Press TV that the protest is targeting companies such as shipping giant FedEx, which he says is one of the largest corporate tax dodgers in America.
“Over the last few years they paid less than one percent in federal taxes despite earning 5.2 billion (dollars),” Hay said.
Between 2008 and 2010, FedEx spent USD 46,000 a day lobbying in the Congress, which is about USD 14 million more than it paid in taxes, Hay added.
Protesters say FedEx is just one of the hundreds of corporations that are taking advantage of Americans.
A recent study, conducted by Citizens for Tax Justice and the Institute on Taxation and Economic Policy, shows that 30 US companies are paying no federal taxes at all.
January 26, 2012
Posted by aletho |
Corruption, Solidarity and Activism | Citizens for Tax Justice, Hollywood, Institute on Taxation and Economic Policy, Los Angeles, Press TV, United States |
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In a meeting on Monday between U.S. State Department and Israeli officials, the U.S. officials promised to extend loan guarantees to Israel for the next three years. The $3.8 billion in loan backing is in addition to the $3 billion a year in aid given to Israel by the U.S. government.
Israel is the only recipient of U.S. foreign aid and loans that is not considered a ‘developing’ nation, with an annual GDP of $235 billion ($29,800 per capita). In contrast, the next biggest recipient of U.S. aid, Egypt, receives less than half of the amount given to Israel and has a GDP of $6,200 per capita. Every other recipient of US aid has a GDP that is below that of Egypt.
The U.S. Congress recently approved a guaranteed $30 billion in aid to Israel over the next 10 years. This aid, unlike assistance provided by the U.S. government to other countries, has no requirements, and is provided without stipulation as to how it should be used.
Reporter Richard Curtiss, with the Washington Report on Middle East Affairs, pointed out in an article on U.S. loan guarantees to Israel that these loans, made by international financial institutions and backed by the U.S. Treasury, are not actually required to be repaid.
Curtiss writes, “Most U.S. loans to Israel are forgiven, and many were made with the explicit understanding that they would be forgiven before Israel was required to repay them. By disguising as loans what in fact were grants, cooperating members of Congress exempted Israel from the U.S. oversight that would have accompanied grants.”
He continues, “On other loans, Israel was expected to pay the interest and eventually to begin repaying the principal. But the so-called Cranston Amendment, which has been attached by Congress to every foreign aid appropriation since 1983, provides that economic aid to Israel will never dip below the amount Israel is required to pay on its outstanding loans. In short, whether U.S. aid is extended as grants or loans to Israel, it never returns to the Treasury.”
The announcement by the State Department officials on Monday included a promise that the loan guarantees would soon be approved by the U.S. Congress.
An Israeli Foreign Ministry official told reporters with the Israeli daily Ha’aretz, “We consider the loan guarantees as preparation for a rainy day”.
The U.S. Congress has received criticism in recent months for its continued aid to Israel, at a time when social programs around the US are being cut due to federal budget cuts, and states have been forced to spend down their own ‘rainy day’ funds to avoid excessive deficit spending during the ongoing economic recession in the U.S.
January 25, 2012
Posted by aletho |
Corruption | Israel, U.S. Congress, United States Department of State, Washington Report on Middle East Affairs |
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From: Stephen Sniegoski
Friends,
This is my recent piece on Gingrich and Adelson. After Gingrich’s major victory in South Carolina, this connection is very significant, but the mainstream media barely touches on the Israel aspect.
Gingrich’s Major Backer Arch-Zionist Sheldon Adelson
Gingrich’s faltering presidential campaign was completely resuscitated by a 5 million donation from Las Vegas casino king and super-Zionist Sheldon Adelson. (According to Wikipedia, Adelson is currently the 8th wealthiest American and 16th wealthiest person in the world, with a net worth of $23.3 billion.) Rising from the ashes, Gingrich now has won the South Carolina primary and has a decent chance of becoming the Republican presidential nominee.
Adelson has been the major backer of Gingrich for some time. A Washington Post article on the Adelson-Gingrich connection (though kept out of the first section of the paper) states: “Perhaps no other major presidential candidate in recent times has had his fortunes based so squarely on the contributions of a single donor, as Gingrich has on Adelson, who has spent millions in support of Gingrich and his causes over the past five years.”
As the Washington Post article points out, Adelson and his Israeli-born wife, Miriam, have spent time and money lobbying for a bill to move the U.S. Embassy in Israel from Tel Aviv to Jerusalem. Gingrich has promised that his first executive order as president would be the embassy move.
Adelson is an ardent Zionist. Since 2007 the Adelson Family Foundation has made contributions totaling $100 million to Birthright Israel, which finances Jewish youth trips to Israel, Adelson is such a hard-line Zionist that he even stopped supporting AIPAC when it appeared to support a 2007 peace initiative championed by Olmert, President Bush, and Secretary of State Condoleezza Rice.
In 2009, the Zionist Organization of America (ZOA), which is a hard-line Zionist group that wants Israel to retain the occupied territories and expand the Jewish settlements, presented Adelson its most distinguished and historic award, the Theodor Herzl Gold Medallion for outstanding achievement in Zionism. His wife received the Louis D. Brandeis Award. The couple now have their names on one of ZOA’s major awards, the Dr. Miriam & Sheldon Adelson Defender of Israel Award.
Adelson is intimately involved in Israeli politics. Since 2007, Adelson has owned a daily newspaper in Israel called Israel Hayom, which distributed free of charge, has the largest circulation of any newspaper in the country. The newspaper is ultra-supportive of Prime Minister Benjamin Netanyahu, to whom Adelson is a close ideological ally and personal friend. The newspaper also has been doing much to promote Gingrich.
It should be recalled that Gingrich was so extreme as to recently say that the Palestinians are an “invented people.” Shortly thereafter, Adelson said that Gingrich had been completely correct. In an address at a Hanukkah celebration in Israel for hundreds of youths visiting that country as part of the Taglit Birthright (Birthright Israel) program (which Adelson funds), Adelson stated: “Read the history of those who call themselves Palestinians, and you will hear why [Newt] Gingrich said recently that the Palestinians are an invented people. There are a number of Palestinians who will recognize the truth of this statement.” He appealed to the Jewish youths to “speak in support of Israel” when they returned to their countries.
When on the NBC show Rock Center, Ted Koppel asked Gingrich about the reason for Adelson’s support, Gingrich was quite frank: “He knows I’m very pro Israel. That’s the central value of his life. I mean, he’s very worried that Israel is going to not survive.”
If Israel is the “central value” of Adelson’s life (which certainly appears to be true), he is one Jewish American who cannot be accused of having a “dual loyalty.” His loyalty is truly singular!
Like most American conservatives, Gingrich purports to identify with the wisdom of the Founding Fathers, but catering to a person with a view such as Adelson’s puts Gingrich in a position completely opposite to that of George Washington, who, in his Farewell Address of 1796, warned Americans of the grave danger of those who had a “passionate attachment” to a foreign country.
While the mainstream media has focused on the negative effects of big money super pacs, and shows no particular fondness for Gingrich, it makes little reference to his major patron’s identification with Israel. In fact, Rachel Maddow and Michael Isikoff even managed to offer a critical presentation of Adelson’s financing of Gingrich without any reference to Israel.
Even the Washington Post’s article on Adelson was not in the major, news section of the paper. And there was no follow up on the NBC program to Gringrich’s response about his major patron’s fundamental concern being Israel—“the central value of his life.” The fact of the matter is that the impact of the Israel lobby on American politics is a taboo issue in the United States mainstream.
When the Republican presidential candidates (Ron Paul being the exception) have talked about foreign policy, it often seems that they are running for the top spot in the Israeli Likud Party, rather than President of the United States of America. Consequently, it is difficult for any candidate to outdo his competitors. However, Sheldon Adelson’s financial backing of Gingrich would seem to indicate that he is the best candidate from the standpoint of the Israeli Right. And Gingrich might go a little farther than his competitors since he even suggests clemency for Israeli spy Jonathan Pollard.
Adelson’s money enabled Gingrich to win South Carolina, and Adelson could put much more into Gingrich’s campaign. With such financial support, Gingrich might be able to gain the Republican presidential nomination, but it would seem that he has too much baggage to actually defeat Obama, at least this is the conventional wisdom–though stranger things have happened. Nonetheless, having pro-Israel Republican candidates led by Gingrich pushes Obama in a more pro-Israel direction, which entails a harder US line toward Iran. No matter what happens in the US presidential election, therefore, US Middle East policy will be improved from the Likudnik perspective. And this is Sheldon Adelson’s objective.
Best,
Stephen Sniegoski
January 22, 2012
Posted by aletho |
Corruption, Progressive Hypocrite, Wars for Israel |
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MPAA Chairman Chris Dodd gave an interview to the New York Times yesterday, in which “Mr. Dodd said he would welcome a summit meeting between Internet companies and content companies, perhaps convened by the White House, that could lead to a compromise.” While framed by the Times as his acceptance of defeat (the MPAA had rejected a prior meeting), the article shows that Dodd still doesn’t get it.
The former Senator hopes for a return to the traditional levers of power, where the laws are written by lobbyists, and sold by back-room deals negotiated behind closed doors. He wants to frame the debate as the comfortable story of a dispute between companies in Silicon Valley and companies in Hollywood, that would doubtless be resolved on the basis of who’s more connected or has better lobbying budgets ‒ or so he hopes.
It wasn’t the technology companies who broke the back of PIPA and SOPA. To be sure, Internet companies played a critical role ‒ Google, Wikipedia, Reddit, Mozilla, Craigslist and over a hundred thousand other websites changed their home pages, informed their users about the bills and facilitated the users’ communications to Congress.
But the dramatic and unprecedented sea change in opposition to blacklist legislation on the Hill came about because of the users themselves. Millions of users ‒ and voters ‒ like you spoke as one, and demanded that freedom of the Internet not be sacrificed on the altar of outdated business models. The opposition was grassroots, not astroturf.
Now that the proponents of SOPA/PIPA have blinked, and taken the bills back to committee, there will be calls to come to a “compromise.” But there is no need to assume that legislation is necessary. As we discuss the future of the Internet, all stakeholders, including the people who use Internet services and consume (and create and share) movies and music, must have a seat at the table. The internet is too important to be debated, dissected and possibly disabled in a private meeting.
January 22, 2012
Posted by aletho |
Civil Liberties, Corruption, Full Spectrum Dominance |
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