Tuesday, April 13, 2010
Amy Muldoon looks behind the hype about how public-sector workers get "exorbitant" pensions--and finds a cabal of right-wing politicians and CEOs out to bash unions.
ACCORDING TO the business press and crusading politicians, the unfettered greed of some in our society is threatening to bankrupt city and state governments, and cause public services to be hollowed out.
Who are these selfish criminals? Wall Street bankers? Defense contractors? Tax-dodging corporate executives?
No, the culprits, according to the latest media hype, are public employees.
The problem, we're told, is that public-sector workers have the nerve to collect "fixed" or "defined benefit" pensions--meaning that their pensions are negotiated according to pay and years of service, as opposed to "fixed contribution" pensions such as 401(k)s that are based on the values of stocks and investments (and which therefore can be worthless if you have bad luck).
A recent cover story in the investors' magazine Barron's by Jonathan Laing--headlined "The $2 Trillion Hole"--touts a recent Pew study which found that the shortfall between what's owed to public-sector workers for their pensions and the funds that have been set aside to pay them is now valued at up to $2 trillion. (The exact dollar amount of the gap is greatly disputed but lies somewhere between $1 and $3 billion).
Laing finds it outrageous that public employees usually retire with a guaranteed pension. His article, and similar one in Forbes and the Wall Street Journal, consciously whip up anti-union and anti-public sector vitriol.
Of course, it's not surprising that the wealthy would bemoan decent compensation for working people. But their intention with the current hype is to generate a backlash from private-sector workers against their brothers and sisters in the public sector. This, they hope, will provide the political space for further attacking public-sector unions.
By Mike Whitney
On Friday, the Wall Street Journal revealed details of a cover up by the nations largest banks that have been engaged in potentially-criminal accounting activities to conceal the amount of debt on their balance sheets. The SEC has been notified of the allegations and has launched a probe to determine whether further action is needed. Among the banks implicated, are Goldman Sachs, JP Morgan, Bank of America, and Citigroup. According to the WSJ:
"Major banks have masked their risk levels in the past five quarters by temporarily lowering their debt just before reporting it to the public, according to data from the Federal Reserve Bank of New York. A group of 18 banks....understated the debt levels used to fund securities trades by lowering them an average of 42% at the end of each of the past five quarterly periods, the data show. The banks, which publicly release debt data each quarter, then boosted the debt levels in the middle of successive quarters." ("Big Banks Mask Risk Levels", Kate Kelly, Tom McGinty, Dan Fitzpatrick, Wall Street Journal)
The article, titled "Big Banks Mask Risk Levels", has set off alarm bells on Wall Street because of the similarity between Lehman Bros. "repo 105" transactions and these new signs of obfuscation by other large banks. "Repo 105" is an arcane accounting device that Lehman used to hide $50 billion in debt off its balance sheet in an attempt to mislead investors about the true condition of its financial health. The WSJ story suggests that the practice may be more widespread than originally thought. The "repo 105" scandal is further complicated by suspicions that Lehman was assisted in its effort by the Federal Reserve Bank of New York which, at the time, was headed by Timothy Geithner. Here is a short recap of what transpired between the Geithner's NY Fed and Lehman according to ex-regulator William Black and former NY governor Eliot Spitzer from an article on Huffington Post:
"The FRBNY knew that Lehman was engaged in smoke and mirrors designed to overstate its liquidity and, therefore, was unwilling to lend as much money to Lehman. The FRBNY did not, however, inform the SEC, the public, or the OTS (which regulated an S&L that Lehman owned) of what should have been viewed by all as ongoing misrepresentations.
The Fed's behavior made it clear that officials didn't believe they needed to do more with this information. The FRBNY remained willing to lend to an institution with misleading accounting and neither remedied the accounting nor notified other regulators who may have had the opportunity to do so...... We now know from Valukas and from former Treasury Secretary Paulson that the Treasury and the Fed knew that Lehman was massively overstating its on-book asset values." (Time for the Truth" William Black and Eliot Spitzer, Huffington Post)
So the question is whether the NY Fed helped other banks conceal important financial information from investors, too. And--if that's the case--then how can the public be confident that the biggest banks in the country are truly solvent?
NEW YORK (CNNMoney.com) -- With unemployment still at a severe high, a majority of states have drained their jobless benefit funds, forcing them to borrow billions from the federal government to help out-of-work Americans.
A total of 33 states and the Virgin Islands have depleted their funds and borrowed more than $38.7 billion to provide a safety net, according to a report released Thursday by the National Employment Law Project. Four others are at the brink of insolvency.
Debt-challenged California has borrowed the most, totaling more than $8.4 billion, followed by Michigan and New York, which have loans worth more than $3 billion. Nine other states have borrowed at least $1 billion from the federal government.
"The nation's financing system for jobless benefits is under unprecedented stress," said Andrew Stettner, deputy director of the New York-based advocacy group for the unemployed. "While the recession has certainly made things worse, this funding crisis has been developing for years."
11 quirky budget cuts: http://money.cnn.com/galleries/2010/news/1003/gallery.city_state_budget_cuts/index.html
According to Tank Books, the flip-top cigarette pack is one of the most successful pieces of packaging design in history. The publisher pays homage to this iconic form by launching a series of books designed to resemble cigarette packs. The books are the same size as a pack of smokes, packaged in flip-top cartons with silver foil wrapping and sealed in cellophane.
The titles are by famous authors such as Kafka, Robert Louis Stevenson and Kipling.
Each story is complete and unabridged with a type size that's easy to read. Individual books cost £8.67and the complete set comes in a striking tin priced at £47.19. You can order this unique conversation piece HERE.
This entry was posted on Wednesday, April 7th, 2010 at 8:33 AM and is filed under Books, Design. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
Turkey is planning a gesture that will challenge Israel and provide support to Gaza's Hamas leaders next month. A flotilla of ships funded by Turkey will approach Gaza in May, in an attempt to challenge Israeli control at sea - or, as organizers put it, "break Israel's illegal blockade on Gaza."
While residents of Gaza have access to the sea, the Israel Navy prevents travel by sea between Gaza and surrounding countries, in an attempt to prevent weapons smuggling. Gaza terrorists have previously used incoming ships to smuggle arms, and have used the sea to transport bombs to the coast of southern Israel.
The ships are sponsored by the Turkish group IHH (Insani Yardim Vakfi), which receives government support. IHH also held a massive fundraiser to collect the more than $2 million it spent on the boats.
The IHH group will be joined by ships from Britain, Greece, and Ireland in the attempt to break Israel's control at sea. The delegation will include members of parliament and journalists, organizers said.
The flotilla follows previous such missions in challenging Israel's ban on international travel to and from Gaza, as part of a campaign dubbed "Free Gaza" by its organizers. The latest group of ships will bring several hundred passengers and 5,000 tons of cargo, including humanitarian supplies, cement, and building materials.
The decision to bring cement is another challenge to Israeli policy in Gaza. Israel allows humanitarian aid through its border with Gaza, but allows cement and metal pipes to enter the area only for use in specific projects, in coordination with international aid groups. Israeli defense experts worry that if Hamas were allowed to import cement and pipes freely, it would use them to build bunkers and rockets as it has done in the past.
A spokesman for the government-backed IHH said the project would serve to "wake the world's consciousness about the crimes committed against Palestinians."
The Israeli prime minister has decided against going to the US for a nuclear summit, which was to have involved the leaders of 47 nations.
Mr. Netanyahu dropped out by announcing at a press conference that he wanted to highlight Israel's opposition to a nuclear Iran.
It is known in political circles that he also decided not to attend because some Muslim delegates were planning to raise the issue of Israel's assumed arsenal of hundreds of weapons.
Over the weekend, Jane's Defence Weekly, which deals with military information, estimated that the State of Israel has up to 300 nuclear warheads, with a power similar to that of Britain.
Ten years in simmering gestation. Well over a year of howling labor pains, far longer than it was supposed to take. Born in San Francisco under a full, neo-pagan moon during a semi-eclipse of the Dog Star alongside a drunken meteor shower whilst Shakti was doing to Shiva that thing with her tongue that drives him absolutely wild.
Made of: wood pulp and ink, sweat and blood, tears and coffee, scotch and sake, spit and come, laughter and bliss. Weight similar to: small ferret/large avocado/your left thigh bone. Smells like: lavender/leather/spurious desire.
More than 85 million people have died since I took the first real step toward this thing's creation, back in August of '08. 126 million more were born. People had sex an estimated 71 billion
times, globally speaking. I contributed a relatively paltry 217 incidents to this fine number. You do what you can.
But it's finally here. It has arrived. I have a wild new book, called "The Daring Spectacle: Adventures in Deviant Journalism." It's shipping right now from my printing house, also pre-orderable via Amazon(though they won't have actual stock for a week or two), available everywhere else very soon. I'd simply love it if you'd grab a copy, or three. Will you?
Some details: I call TDSa "mega-compendium." It's a glorious collection of my wildest, weirdest and most popular columns from the Chronicle and SFGate, spanning nearly 10 years but focusing mostly on the more recent stuff, because I prefer to keep it reasonably fresh, my writing has improved tremendously over the years, and some of the really old stuff is downright embarrassing.
The book includes more than 90 columns, with commentary. There's a whole bunch of horrifying hate mail, hundreds of photos, all sorts of messy rock 'n' roll design goodness. I'm happy to say, looks and reads like nothing else out there.
I'll be doing readings, signings, prayings, hurlings, bake sales, yoga demos, whatever else I can think of, soon, to the point where you will likely be quite sick of hearing about it. I apologize for that in advance. But what can I do. I'm a writer. It's a livelihood. And it's a damn cool book, if I do say so myself.
Did I mention it's self-published? That it's a grand and weird experiment, that, by purchasing a copy, you're taking an active stake in my livelihood? And my rent? And my sake budget? Because you are. Full details at daringspectacle.com.
And yes, for the record, it helps me much more if you buy it at full price through AtlasBooksright now, sted of Amazon. But I begrudge no one wishing to order it anywhere, at any time, for any reason whatsoever. In fact, I'd simply love it if you'd ask your fave local bookstore order some stock as well. The ISBN is 978-0-9842997-0-6, if that helps, which is sometimes does.
Upcoming newsletters will list out my appearances and readings and such. By the way, if you're a bookstore owner in a largish city and want to host a reading/signing, let me know. We could have much fun.
There is my humble plea. I hope you enjoy the book. I hope you love it like sunshine loves chocolate, all sticky and melty and good. Go forth and purchase.
The report is pessimistic on the chances that existing business models will ever transition successfully online. It notes that only one in seven UK news consumers declared a willingness to pay for content. However, the trust factor should embolden publishers to seek more innovative revenue models, including advertorials and transaction fees.
In our view, this is news organizations' best shot. As the volume of online information grows by leaps and bounds, the need for trusted sources grows with it. Publishers need to discard their not-invented-here thinking and look for ways to aggregate information in ways that command a premium value. We also really like the transaction fee idea. We've been pushing that one for about a year.