Friday, April 2, 2010
Monumental amount of research blows away any doubt about globalist agenda for international collectivist tyranny
Film maker Jason Bermas has collected a truly monumental amount of video archive and document material to render completely obsolete claims that the agenda of today’s ruling elite is not the open move towards a global totalitarian world government which will be run to the detriment of the people in the self-interests of the tiny ruling class that sit atop the power pyramid.
Bermas’ highly anticipated documentary Invisible Empire exposes the New World Order in their own words, by painstakingly showing how the elite have not only conspired to create a dictatorial global government in private, but have publicly stated their agenda hundreds of times in public.
By highlighting the words of people like Paul Wolfowitz, Michael Mullen, David Cameron, Gordon Brown and many many others, Invisible Empire dispenses with the conjecture and sticks to the cold hard facts. This movie is guaranteed to wake up even the most ardent skeptic to the manifestly provable acceleration towards an authoritarian planetary regime that intends to control and regulate every aspect of our existence
Invisible Empire is presented with the aid of the slick graphics, professional scripting and dedicated depth of research that will prove vitally important in presenting this shocking information to others who may otherwise seek to dismiss the sheer scale of the conspiracy at hand.
The film traces the lineage of the evolution of global governance from Samuel Zane Batten’s 1919 manifesto New World Order, through to Hitler’s vision of a 1000 year Reich, to the modern incarnation of the conspiracy which has its roots in the evil deeds of people like George H. W. Bush, David Rockefeller and Henry Kissinger.
Invisible Empire deftly encapsulates how Hitler’s vision of a new world order was promoted during the 1936 Olympic Games, with the five Olympic rings being prominently displayed for the first time, a totalitarian representation of the five major regions of the world interlocked under one dictatorship.
President Roosevelt denounced Hitler’s dream of a new world order and a system all but identical to the very same agenda espoused by people like Tony Blair, Bill Clinton and Gordon Brown today, namely, “Systems of government based on the regimentation of all human beings by a handful of individual rulers who seek power by force,” under a “new order”.
Invisible Empire is all conspiracy and no theory – proving beyond doubt how the elite have openly conspired to insidiously rule the globe via the engines of the CFR, the United Nations, the Trilateral Commission, and the Bilderberg group, which were born out of the historical Round Table groups first set up by Cecil Rhodes.
The film documents how, far from being mere “talking shops,” as they are dismissively framed by the establishment media, organizations like Bilderberg were fundamental in crafting things like the European Union and the Euro single currency decades before they came into fruition.
The influence enjoyed by groups like the Trilateral Commission over Presidents and Vice Presidents is highlighted with buried footage of George H.W. Bush exasperated in attempting to explain away his connections to globalist organizations during the 1980 election race. The film explains how the assassination attempt on Reagan, carried out by a Bush-linked assassin, acted as the catalyst for the Reagan presidency to be hijacked by globalist interests.
Invisible Empire catalogues the primary criminal enterprises through which the agenda is financed, operated and advanced – government controlled drug-running, false flag terror, banking scams, and how the whistleblowers who exposed these criminal networks were the subsequent victims of state sponsored assassination, people like Barry Seal, Daniel Casolaro, and Gary Webb.
Indeed, Invisible Empire highlights how anyone who acts as a roadblock to the shadow government agenda is taken out, people like Princess Diana, JFK, Bobby Kennedy, Martin Luther King, who the House Assassinations Committee, in the cases of JFK and King, concluded were killed as a result of a conspiracy and not by a lone nut assassin.
The most contemporary branch of the agenda to enforce neo-feudalism and top-down communitarianism, in total hostility to the notion of true freedom and individuality – the phony environmentalist movement – which is driven by the global warming fraud, is also blown wide open.
G. Edward Griffin correctly characterizes the new world order as a form of collectivism, “Where individuals are considered to be discardable and that the group is more important and that the ultimate group is the state….so it boils down to the fact that the state is the all important unit of society and citizens exist only to serve the state.”
Griffin, along with author Mark Dice and legendary political scientist Peter Dale Scott, lift the lid on where the new world order came from, how it operates today and what its dark plans are for humanity’s future.
Invisible Empire also delves into the deepest and darkest offshoots of the wicked plan for global enslavement, including the move towards a microchipped population, prostitution rings run by and for the elite, as well as the bizarre occult practices power brokers embrace as part of their religion of power and domination.
Invisible Empire will be more than just a film– it is the culmination of years of research by Jason Bermas into the inner-workings and most revealing public statements by the New World Order and the most trusted stewards of their dark vision. Invisible Empire promises to unveil the long-term agenda for world control, just as Fabled Enemies and Loose Change Final Cut forever stripped away the facade of the official story of 9/11 and exposed the dark truth that lies behind.
You can pre-order Invisible Empire on DVD now by clicking here or be the first to see it in high quality online at Prison Planet.tv – click here to get your subscription which also includes daily audio and video archives for The Alex Jones Show, the live video show stream, as well as every single Alex Jones documentary ever produced along with a plethora of others, not to mention a 6 year library of special video reports and archives.
A few days ago, via e-mail correspondence, I answered some queries about the new health-care-insurance law put to me by Marina Galisova, a reporter for the Slovak weekly magazine Tyzden. It seems that this interview has formed the topic of an article in the magazine, although I cannot be sure because I cannot read Slovak. In any event, on the assumption that not many readers of The Beacon can read Slovak, either, I reproduce here the questions Galisova put to me and my answers.
1. Under the passed legislation, what does it mean that “every American having health insurance”? How much shall be paid by the federal government and how much by the states to gain this objective?
The new law forces everyone to buy health-care insurance. Many people already have such insurance, most of them as part of the compensation they receive from their employer. In general, these people will be able to keep their current coverage. People who do not buy health-care insurance acceptable to the government will be fined heavily, so besides having no health-care insurance, they will be punished by the government!
2. It looks unlikely that this “reform” will result in a better health care for Americans. However, can you think of at least one example where it might actually help someone?
In general, the new system will make health care worse in the United States, for many reasons. However, some persons will benefit. The major beneficiaries will be those with pre-existing conditions who are currently rejected by insurance companies (the companies do not wish to sell fire insurance to people whose houses are already on fire). The new law forbids insurance companies from rejecting any applicant because of a pre-existing condition. Owing to this new legal requirement, health-care insurance will no longer be true insurance, but merely a third-party payment system for health-care expenses.
3. Will the price of health insurance be kept down by state force? Will Americans be forced to buy health insurance—subsidized by the state? Will Americans be forced to pay premiums, as, if I remember correctly, Dr. Ron Paul has once indicated?
Premiums and benefits of health-care insurance plans are already heavily regulated by the state and federal governments. The new law places many new requirements and restrictions on the companies. It also regulates the difference between the amount they may charge older people and the amount they may charge younger people. The result will be that younger people will have to pay greater premiums than they would pay under a fair insurance scheme in a free market; that is, younger people will be forced to subsidize the health-care expenses of older people (who demand much greater amounts of health care).
4. What, in your opinion, will be the long term effects for American health care? Do you expect deterioration in the quality of services, as is often the case in Canada and in Europe?
This system will almost certainly prove to be much more costly than now projected. Pressure will be created to increase the prices of care and the amount of insurance premiums needed to cover the costs of care. The government will respond by measures that amount to price controls and by selective subsidies to lower-income people and to those with the most political clout. Shortages will increase; waiting times for care will increase; the quality of services will decrease. The overall health care system will cost more and more while delivering worse and worse care. Ultimately, the government will probably throw up its hands and nationalize the entire system because it will have become such a terrible mess.
5. Could you say that the Americans are, as a majority, in favor of this legislation? Not even all Democrats supported the bill…
Polls show that a majority of Americans oppose the law just enacted. These poll results seem plausible to me. In truth, however, few Americans have much real knowledge about the present law, which occupies more than 2,000 pages, and even less understanding of the economics and political science required to understand its likely consequences. The law is not simply a shot in the dark, it is a barrage in the dark.
(JBS) – After terrorist conspirator and “former” U.S. government agent David Coleman Headley received promises of leniency and extradition protection from American prosecutors for his role in the 2008 Mumbai massacre, speculation about his true masters was set ablaze as outrage erupted across India.
Headley — a former Drug Enforcement Administration agent and the son of a Pakistani diplomat — pled guilty to various criminal charges on March 18 in connection with his terrorist activities in India, Pakistan and Denmark. He is reportedly “cooperating” with investigators.
In exchange, the government vowed not to allow foreign authorities to question him or subject him to trial. Prosecutors also agreed not seek the death penalty, and he may not even serve a life sentence. Links to U.S. intelligence agencies will remain classified. And his guilty plea ensures that there will be no drawn-out trial that could publicly reveal any relationships with various intelligence agencies — most notably, the Central Intelligence Agency-linked Pakistani Inter-Services Intelligence.
Headley admitted in the plea bargain that he helped plan the bloody massacre by conducting surveillance and selecting targets, gathering GPS coordinates for the terrorist team’s boat landing along the coast, and more. He was also helping to plan an attack on a Danish cartoonist. And while the Federal Bureau of Investigation was given almost 10 hours to question the only surviving attacker in India, a team of Indian investigators who traveled to the U.S. to interrogate Headley was turned away.
The plea deal and the lack of American cooperation immediately sparked fury and despair in India, as the U.S. is reportedly bound by treaty to surrender Headley to Indian authorities. It also fueled accusations in the media that Headley still may have been linked to the American or Pakistani governments in some capacity. He began his terrorist training around the time that he was working for the U.S. government. But the connections, however, remain shrouded in mystery.
The terrorist group he was known to be working with —the ISI-linked Pakistani Lashkar-e-Taiba— carried out the devastating Mumbai attack in November of 2008 that dominated headlines around the world. The terrorists rampaged through the city with machine guns and grenades, leaving over 150 dead and hundreds more wounded. And as it turns out, the terrorist group was actually created with the help of Pakistan’s secret services, which have well-known ties to the American Central Intelligence Agency and other government agencies.
“The LeT’s close links with Pakistan’s Inter-Services Intelligence (ISI) are legion and it is inconceivable that such a massive operation — with huge international ramifications and the potential to trigger war with India – could have been undertaken without the knowledge of the ISI, headed by General Ashfaq Parvez Kiani, the present army chief, from October 2004 until October 2007,” wrote M.K. Bhadrakumar, a former Indian ambassador who served in Pakistan, the Soviet Union and Afghanistan, among other assignments.
Along with many prominent Indians, Bhadrakumar strongly condemned Headley’s plea agreement in the press. “The deal enables the US government to hold back from formally producing any evidence against Headley in a court of law that might have included details of his links with US intelligence,” he wrote in the article for Asia Times. “Headley’s links with the US intelligence will now remain classified information and the Pakistani nationals involved in the Mumbai attacks will get away scot-free.”
He also noted that the Obama administration was “behaving very strangely” and that it had something “extremely explosive” to hide. “The speculation gaining respectability in Delhi is that Washington knew in advance about the Mumbai attack and deliberately chose not to pass on details to Delhi,” the ambassador noted in the piece, entitled ‘A spy unsettles US-India ties.’ “Clearly, the Obama administration was apprehensive that Headley might spill the beans if the Indians got hold of him and the trail could then lead to his links with the CIA, the LeT and the Pakistani military.”
Headley’s involvement with the U.S. government began when he was caught trafficking heroin. To reduce his sentence, the DEA convinced him to work as an undercover agent in Pakistan. And in exchange for his cooperation, he only served two years. After 9/11, the agency worked closely with other government outfits, and they were forced to share information. So anti-terror operations had to have been aware of Headley’s activities. These facts have led Indians to conclude that he was, in fact, still working for American intelligence.
“Many Indians are convinced that Mr. Headley is a CIA agent, perhaps gone rogue, and that the U.S. intransigence represents an attempt to shield him and his past activities from scrutiny,” said writer Akash Kapur in a piece published by the New York Times. Another New York Times piece, entitled ‘American Scout for Mumbai Attacks Was Jokingly Called ‘Agent Headley’ by Friends,’ points out that Indians who knew Headley had long suspected that he worked for the CIA.
“I had a hunch then and I have a hunch now that he was an American agent of some sort,” Headley’s Indian friend Rahul Bhatt told Channel 4 News. “I nicknamed him Agent Headley. I thought, and I suggested to him, that he worked for the Central Intelligence Agency, and he used to not like it.” Apparently, Headley even “begged” Bhatt to stop calling him “Agent Headley” in public.
An important former Indian government and counterterrorism official was blunt with his conclusions as well. “The mishandling by the US is due to its anxiety to prevent a public admission of the US intelligence community’s links with him and to protect Pakistan from the legal consequences of its role in the 26/11 terrorist strikes,” noted security analyst Bahukutumbi Raman, a former top counter-terrorism official with India’s foreign intelligence service.
“The plea bargain entered into by the FBI with Headley last week has created strong suspicions in India that the FBI wants to avoid a formal trial of Headley and was reluctant to allow Indian investigators to interrogate him because Headley was a deep penetration agent of the US intelligence,” he added. Raman explained that Headley “was not a double agent, but a quadruple agent.” He also allowed for the possibility that Headley may have gone horribly “out of control.”
Speculation about the U.S.-agent-turned terrorist continues to run rampant in the Indian press. But how much is really known? In court documents, Headley’s associates are referred to simply as A, B, C and D. So the truth about Headley may never be known to the public. And while that is a veritable tragedy, the truth must still be sought. The theories remain as varied as they are numerous, but the secrecy and strange deals seem to confirm people’s suspicions that their governments are totally out of control and out of touch with the citizenry. Pakistan and India have even moved their “proxy war” into U.S.-occupied Afghanistan, complicating matters even further.
But there are several lessons to be learned from the tragedy and its fallout. For the Indians, be much more careful when “cooperating” with “allies.” Also, examine your own government carefully — many of the theories surrounding the attack involve cooperation of at least some Indian officials.
Even more importantly, the government must respect the right of the people to keep and bear arms. The terrorists stormed through the city unhindered — slaughtering everyone in their path — for more than two days! As famed Indian pacifist Mohandas Gandhi wrote in his autobiography: “Among the many misdeeds of the British rule in India, history will look upon the act of depriving a whole nation of arms, as the blackest.” And still, decades after independence, the government continues its counterproductive and dangerous policy of keeping law-abiding people disarmed, and therefore, easy targets.
For Americans, there are serious implications too. If the federal government would stick to the Constitution and quit meddling in foreign nations, these sorts of issues would not even crop up. The anti-American animosity and suspicion built up around the world would not exist. “Blowback” would not threaten American citizens and interests around the world. And the billions of dollars saved could be returned to the citizenry. So for the sake of U.S. taxpayers, victims of terrorism around the world and all of the casualties of the “war on terror,” it’s time for some serious changes in American foreign policy. The people must hold the government accountable, or the tragic consequences — death, oppression and confusion — will continue to mount.
Alex Newman is an American freelance writer and the president of Liberty Sentinel Media, Inc., a small media consulting firm. He is currently living in Sweden and has spent most of his life in Latin America, Europe and Africa. He has a degree in foreign languages and speaks Spanish, French, Portuguese, German, Italian and a little Swedish and Afrikaans. In addition, he earned a degree in journalism from the University of Florida, with emphasis on economics and international relations.
Geithner: Pickpocketing Trillions from the People to Give to the Oligarchy Was "Deeply Unfair", But We ... Um ... Had To
Tim Geithner told the Today Show that:
It's "deeply unfair" that some financial institutions that got taxpayer-paid bailouts are emerging in better shape from the recession than millions of ordinary Americans.
Geithner also argued that President Barack Obama had no choice when confronted with a financial crisis.
"As the president has said, we had to do some very unpopular things," Geithner said. "People looked at what had happened."
"It's not fair. It's deeply unfair," he said. "He (Obama) had to decide whether he was going to act to fix it or stand back ... and that would have been calamitous for the American economy."
There are only a couple of minor inaccuracies in Geithner's statements:
- Geithner's entire approach is wrong, because the economy can't recover until many of the "financial institutions that got taxpayer-paid bailouts [and] are emerging in better shape" are broken up
- The government has been anemic in addressing unemployment
Moreover, it is not like their approach fell on them and they couldn't do anything about it. Geithner, Summers, Bernanke and the boys made a conscious decision to side with the oligarchy at the expense of the people.
As Simon Johnson and James Kwak write:
[There was a] point at which the government had to decide if it would defend the financial oligarchy from populist outrage, or whether it would reform the financial system that brought us the financial crisis and severe recession. We do not think it was an easy choice. But ultimately Obama and his advisers chose to bet on the bankers they knew. The result has been even larger banks and an even more concentrated financial sector.Geithner also told the Today Show that he hopes skeptical voters will note legislation moving through Congress to bring reforms to the financial system.
He's banking, of course, on the fact that many voters won't realize that the legislation is a placebo containing no real medicine.
Geithner ended the interview with this pearl of wisdom:
"What happened in our country should never happen again," he said. "People were paid for taking enormous risks. It was a crazy way to run a financial system." Geithner said, "It's the government's job ... to do a better job of restraining that kind of risk-taking."Indeed ... too bad that Geithner and the boys are still encouraging that kind of risk-taking.
Geithner was, of course, largely responsible for much of the failure of the government to restrain risk-taking in the first place.
As William Black points out:
Mr. Geithner, as President of the Federal Reserve Bank of New York since October 2003, was one of those senior regulators who failed to take any effective regulatory action to prevent the crisis, but instead covered up its depth.Geithner was also complicit in Lehman's accounting fraud .
And pushed to pay AIG's CDS counterparties at full value, and then to keep the deal secret.
And as Robert Reich notes today, Geithner was "very much in the center of the action" regarding the secret bail out of Bear Stearns without Congressional approval.
Indeed, the list of Geithner's hinky actions grows longer by the day as new facts emerge.
This gets a bit para towards the end, but the historic info is spot-on.
What You Didn’t Know About The Popes Of Rome
By Mark Owen
On the evening of Saturday April 2, 2005, after receiving the Rite of Extreme Unction, Pope John Paul II passed away. At this time his chamberlain would have gone to the papal hospital bed and asked the Bishop of Rome a question, “Are you dead?” There would be no reply from the Pope. The chamberlain would then pick up a silver hammer and strike the Pope on the head and repeat his question, “Are you dead?” Again there would be no reply. The chamberlain would then thrice call out the Pope’s baptismal name. He would then declare the Pope to be dead.
This is the way the Church has determined papal deaths for centuries. This is the way of the world’s oldest monarchy.
Since 1763 the august Almanach de Gotha has been the ultimate authority on the royal houses of Europe. Listed under ‘Reigning Sovereign Houses’ is the Holy See. Therein is stated, “the incumbent of the Holy See is considered by Christian sovereign families as the ‘Father of the Family of Kings,’ [and] his Holiness represents the OLDEST MONARCHY on earth”
The triple sovereignty of the Pope-Person, Holy See & Vatican City–is distinct in fact and in law. Internationally, he is not subject to any authority on earth. His Cardinals are considered to be Princes of the Church and peers of the sons of reigning monarchs. Each diocese is considered to be a royal fiefdom. The word ‘diocese’ originally signified an administrative unit devised by the Emperor Diocletian, a tyrant noted for his persecution of Christians.
Does it seem right to you that a state's ability to stay afloat should be the stuff of secretive betting pools? That's just what's happening. While states like California struggle to pay their teachers, librarians and cops, traders are gambling -- by buying credit default swaps -- on the fate of our biggest state. And that's just half the story.
The very same banks that sell and profit off the swaps, at the same time underwrite and price the state's assets -- their municipal bonds. That means that even as JP Morgan Chase, Barclays, Goldman Sachs and Citigroup deal out the bonds that the state issues to raise cash, they're making money, separately, on the risks involved. They get their fees coming and going.
It's the same double-dip banking-and-betting scenario that's accused of bringing Lehman Brothers down. What's being done? In Europe, after Greece came dangerously close to sucking itself down the debt-swap sinkhole, EU leaders called for stiff regulations; reining in or even banning certain types of derivatives trading and demanding far greater transparency.
New laws proposed here, however, hardly put a dent in the way derivatives are handled. No one's worrying too much because the federal government keeps selling bonds; debts keep on rising, debt- buyers keep on profiting and state schools and libraries and police and fire departments shrink and shrink.
California's state treasurer, Bill Lockyer, finally wrote to the big banks this week, asking for clarification. Being in hoc to a croupier is bad enough, but when you're paying the croupier you want to know he's not working for peeople betting against you. Californians pay fees to the banks for all that bond underwriting. The state has a right to know: Just who are the banks working for? And we the taxpayers have that same right. In case you didn't notice, taxpayers are the all-round losers here. Public coffers are taking on everyone's risk (the states' as well as the banks') even as public services shrivel. Lovely.
The F Word is a regular commentary by Laura Flanders, the host of GRITtv which broadcasts weekdays on satellite TV (Dish Network Ch. 9415 Free Speech TV) on cable, and online at GRITtv.org and TheNation.com. Support us by signing up for our podcast, and follow GRITtv or GRITlaura on Twitter.com.
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April 1 (Bloomberg) -- Hotel foreclosures in California climbed 27 percent in the first quarter from a year earlier as unemployment cut business travel.
Foreclosures, including the 469-room Los Angeles Marriott Downtown, rose to 79 properties from 62 in the first three months of 2009. Defaults increased 6.5 percent to 327, Irvine, California-based Atlas Hospitality Group said in a statement. The company specializes in selling hotels.
The U.S. lodging business is struggling with declining room rates and falling occupancy in the wake of the deepest recession since the 1930s. In California, 12.5 percent unemployment reduced business travel budgets and cash flow to hoteliers.
“If we look throughout the U.S., states like Florida, Nevada, Arizona and California were tied very closely to the housing boom and that was a big driver of the economy there,” Atlas President Alan Reay said in a telephone interview. “Hotels that are suffering the most are in areas with high unemployment.”
Riverside, California, outside of Los Angeles, had nine hotels in foreclosure in the first quarter. San Bernardino was home to eight and Los Angeles had seven, Atlas said. An additional 38 Los Angeles hotels were in default, according to Atlas.
Revenue per available room, or revpar, at California hotels dropped an average of 3.5 percent during the first two months of this year compared with the same period in 2009, Reay said. Some markets in the northern part of the state reported increases, while central California continued to decline and properties along the coast and in Los Angeles were little changed, he said.
“Most hotels that have been in trouble will still struggle through 2010 because of the amount of debt they have,” said Reay. “Even with increased revenue, they can’t cover their debt service.”
He estimates more than 1,000 hotels in the state are operating under forbearance agreements, where lenders have modified the loans that are starting to come due.
“One bright spot in California is that there is a tremendous amount of interest from overseas buyers, particularly from Asia and China,” he said. “They are seeing this as a great bright buying opportunity.”
--Editors: Sharon L. Lynch, Josh Friedman
To contact the reporter on this story: Nadja Brandt in Los Angeles at firstname.lastname@example.org.
To contact the editor responsible for this story: Kara Wetzel at email@example.com.
But with the city facing a budget deficit that could drain its reserves by summer, Mayor Villaraigosa wants to re-open contract talks with 45,000 cops, firefighters, librarians and other city employees in hopes of persuading them to contribute more to their pensions and health-care costs. His deputy chief of staff, Matt Szabo, puts it bluntly: "Unions have priced themselves out of a job."
Nationwide, politicians looking for budget cuts are confronting politically powerful unions that represent state and local government employees—15% of U.S. workers and organized labor's biggest stronghold.
In Memphis, the city's health-care committee recently recommended raising current and retired employees' health-insurance premiums by as much as 15%. And Toledo's city council last week wrung $3.1 million in concessions from its firefighters' union as part of a measure to close its budget gap.
Similar things are happening at the state level. Over the past two years, 17 states have cut benefits for employees or increased the amount that individuals must contribute to their pension plans. Three of those states—Kentucky, Texas and Vermont—did both, according to the Pew Center on the States, a public-policy think tank.
Los Angeles Mayor Antonio Villaraigosa announces the elimination of the Environmental Affairs and Human Services Departments in February, cutting 46 jobs.
At the heart of this fight is an unbalanced equation: The economy is shrinking cities' and states' tax income as their pension and health-care costs have soared. As a result, some governments are diverting money from services to cover benefits, or raising taxes and fees. That doesn't sit well with some taxpayers—many frustrated at seeing their own benefits being cut by private-sector employers.
So governments are seeking cuts in union benefits long considered sacrosanct. This has risks. Public-employee unions are among the biggest political spenders, and their members vote in droves. Also, cutting benefits could make it tougher to keep the best employees.
It is tough to compare government pay to private-sector pay because many government jobs—firefighters, police officers—don't have private counterparts. But, on average, government workers make more in wages and benefits. In December, state and local governments spent an average of $39.60 in wages and benefits per hour worked on their employees, versus an average $27.42 for private employers, the Labor Department said.
The fight over benefits represents a defining moment for public employees and their unions. Government is by far the most unionized sector of the work force, and among the few places left where blue-collar workers can retire with traditional lifetime pensions. In 2009, the nation's 7.9 million unionized government workers eclipsed the number of private-sector union members for the first time since the Labor Department began keeping track in 1983.
"What comes out of all these negotiations will set the tone for public employees for a while," says Ken Jacobs of the Center for Labor Research and Education at University of California, Berkeley.
In New Jersey, outrage over state deficits helped Republican Chris Christie defeat incumbent Democrat Jon Corzine last November. A few weeks after Mr. Christie's victory, a Quinnipiac University poll found that three-fourths of state voters supported a wage freeze for state workers, and 61% favored layoffs. Last month, Gov. Christie signed a set of bills that would, among other things, cut pension benefits for future employees.
Public-employee unions argue that it's unfair to penalize them for a financial crisis that isn't their fault. They say cities and states are opportunistically taking advantage of a short-term crisis to gut benefit plans in place for decades.
Many private-company workers have seen their retirement accounts shrivel, while public-sector benefits have been relatively unscathed. Defined-contribution plans such as 401(k)s had $3.33 trillion in assets at the end of 2009, down 4% from $3.48 trillion in 2006, according to the Federal Reserve. Such accounts have lost value even though companies and workers contributed $100 billion over that period.
The rise in public-sector benefits has attracted the ire of citizens like Paul Nelson, a semi-retired investor in Upper Saddle River, N.J. Mr. Nelson, 59 years old, has a son at Northern Highlands Regional High School, where the principal says the school may have to cut teachers and increase class size. "Most public employees have retirement and health-care plans that private-sector employees can only dream of," says Mr. Nelson.
Virtually all full-time state- and local-government employees have access to retirement plans, and most are employer-funded. By contrast, only three-quarters of full-time workers in the private sector have access to retirement benefits.
Disparities like these give politicians ammunition for cost-cutting. "Public-employee benefits have to be reined in," says Andrew Koenig, a Republican state representative in Missouri.
Mr. Koenig is sponsoring a bill in his state that, over the next several decades, would shift away from a defined-benefit plan, where an employer puts as much money into a pension fund as needed to cover future retirement benefits. It would be replaced with a 401(k)-type of plan (similar to those now in place at many private-sector employers) where workers absorb the market's ups and downs.
Some argue that just because corporations have trimmed employee benefits doesn't mean the government should as well. "There has been an attack on American private-sector workers and benefits, with 401(k)s replacing traditional pensions," says Teresa Ghilarducci a professor at the New School for Social Research in New York City, "and they have failed" at providing retirement security.
At the root of governments' problems today are promises made in past decades. As a group, state and local governments have promised an estimated $3.35 trillion in pension and health-care benefits to be paid over the next three decades, but are estimated to have 70% of the money to cover those payments, according to the Pew Center on the States. Pension and health costs can consume 20% of city and state budgets.
California offers a view of the fallout. The state's largest pension fund, the California Public Employees' Retirement System, known as Calpers, is estimated to be only 57% to 65% funded. Having suffered investment losses in recent years, the state has had to dip deeper into its revenues to make up the funding gap. Last year, a budget impasse forced the state to issue IOUs for taxpayer refunds.
It wasn't long ago that California was going the other way, based on a different set of assumptions. In 1999, the state's Democratic-controlled legislature and then-governor Gray Davis passed a law expanding benefits for many state employees. A proposal prepared by Calpers—the $200 billion fund that manages money for 1.6 million of the state's employees, retirees and their beneficiaries—forecast that the boosted benefits would be paid for entirely by investment gains. "There are only two ways you can have this problem: One, the promised benefits are too big, or two, not enough money was put away," says David Crane, special adviser for Gov. Arnold Schwarzenegger.
California's contribution to its public-employee pension fund is projected at $3.5 billion in the fiscal year starting July 2010, 4% of the state's general-fund budget, the highest proportion in state history.
In Los Angeles, the battle is spilling into the public, including at a noisy City Council meeting in February. On the agenda was a plan to cut 1,000 workers and reopen contracts. Union members turned out to voice opposition.
Art Sweatman, a tree surgeon for the Department of Public Works, showed up wearing baseball cap that read "Deadwood." It was a reference to comments by Mayor Villaraigosa last year in which he said a new early-retirement program could rid the city of "deadwood" employees.
"We have to let them know we're here," says Mr. Sweatman, a member of the Service Employees International Union local 721. Mr. Sweatman's union says it is trying to meet the city half way. Local 721 has agreed to early-retirement programs and furlough days, says executive director John Tanner, but it has resisted health or pension rollbacks. "Our goal was to get through this without layoffs or cost-shifting on health care," he says.
Government benefits are almost as old as government itself. Military pensions stretch back to the Roman Empire, predating private-sector benefits by centuries. The U.S. offered retirement pay to soldiers who fought in the revolutionary war, and by 1930 the federal government gave pensions to all its employees. Pensions at private-sector employers came into widespread use only after World War II.
Lee Craig, an economics professor at North Carolina State University, says pressure has been building for years to cut government benefits, with the financial crisis accelerating that. "Their promises have finally outstripped the growth of their tax bases," he says.
California's Santa Barbara County, a coastal area known for wineries and Spanish architecture as well as Michael Jackson's former Neverland Ranch, has seen tax revenues fall over the past three years. The county has reduced its work force by 7.5% and management salaries have been frozen since 2008.
At a workshop conducted by the county's executive office, representatives from two dozen departments—the sheriff's office, mental services, and public works, among others—were required to suggest cuts. The proposals included eliminating two Spanish-speaking interpreters in the public defender's office, closing a camp for delinquent teenage boys that opened in 1944, and reducing staff in a child-abuse prevention program. Another proposed move could add four to six more weeks to the wait for food stamps.
In Redding, Calif., the mayor and city council are asking city workers to contribute 7% to 9% of their salaries to their pension funds; currently the city picks up that tab. Patrick Jones, who runs his family's gun shop in addition to serving as part-time mayor, says if the council doesn't win concessions it might use a November ballot initiative to ask voters to demand that the city negotiate benefit cuts. That move, he said, would give the city leverage in any union negotiations. "We're just trying to get as many tools as possible to quicken the time it takes" to get concessions, Mr. Jones says.
One group fighting back in Redding is the International Brotherhood of Electrical Workers, which represents 53 electrical workers on the city payroll. One recent morning, about two dozen members gathered in the "bull room," where linemen and electricians meet to get their work assignments. The workers listened to union representative Ray Thomas update them on the contract fight. Mr. Thomas said he hasn't any intention of agreeing to benefit cuts, but told his workers not to expect much.
"If it doesn't screw the future, it's something we'll have to discuss," Mr. Thomas said.
A member of the audience raised his hand and asked if it was true that deputy sheriffs in surrounding Shasta County had been considering a plan to pay more of their retirement costs.
"Did they vote to accept that?" another asked.
Mr. Thomas nodded his head yes.
NEW YORK (CNNMoney.com) -- Job cuts accelerated in March, driven by planned reductions on government payrolls, a report released Thursday showed.
Employers announced plans to cut 67,611 jobs in March, according to outplacement firm Challenger, Gray & Christmas Inc. That's up 61% from February, when 42,090 jobs were lost, the lowest level in nearly four years.
"Unfortunately, many people are still jobless and many businesses still shuttered," said John Challenger, chief executive officer of the firm, in a statement. "This combination is having a significant negative impact on state and local tax revenues and, in turn, leading to continued downsizing in this sector."
Government job cuts led March's surge, accounting for nearly 75% of the total jobs shed. Year to date, government job losses have made up about a third of all announced cuts.
There were 50,604 announced government job cuts in March, and the United States Postal Service alone plans to reduce its workforce by 30,000 workers this year through retirement and attrition. The rest of the government jobs will be shed by state and local agencies suffering from budget shortfalls.
But overall the trend was still positive. March job cuts were down 55% from the same month a year ago, when 150,411 cuts were announced.
In the first quarter of 2010, a total of 181,183 job cuts were announced, the lowest first quarter total since 2000 and down 69% from the first quarter of 2009.
A separate report Wednesday from payroll processor ADP showed that private-sector employers cut payrolls by 23,000 jobs in March, marking the smallest monthly decline since February 2008. ADP's report does not include government jobs.
The report sets the stage for the highly anticipated monthly jobs report from the government due Friday. The Labor Department is expected to show a gain of 190,000 jobs in March, compared to the 36,000 lost in February. Economists forecast the unemployment rate will remain unchanged at 9.7%.
NEW YORK—With its unparalleled views of Central Park and striking black-glass façade wrapped in travertine marble, the swooping tower at 9 West 57th St. in Manhattan is among the world's most prestigious business addresses.
Today, it sits half empty.
Roughly 24 of the building's 50 floors are vacant, including the top three, according to people familiar with the building. Even in today's dismal real-estate market, the amount of empty space in 9 West, as the building is known, is unique among high-end New York office towers.
Nine West has rich connections to American finance. Much of the action surrounding the legendary takeover of RJR Nabisco, chronicled in the book "Barbarians at the Gate," took place on the 42nd floor at the offices of private-equity firm Kohlberg Kravis Roberts & Co. A popular women's shoe brand, Nine West, is named after the address where it was founded. The building was recently touched by the crimes committed by imprisoned fraud figures Bernard Madoff and Marc Dreier.
Brokers and tenants trace the mass vacancies to Sheldon Solow, 9 West's billionaire owner. Mr. Solow has declined to reduce rents in the building, where the highest floors go for roughly $200 a square foot. The average asking rent of 9 West's neighborhood, the so-called Plaza district: $79 per square foot, down 18% from a year ago, according to Reis, a commercial-real-estate data provider.
Mr. Solow also is known for his lawsuits, which have become legion over the years.
Nine West's largest tenant, Bank of America Corp., left the building two years ago for its own new office tower, but not before Mr. Solow tried to evict the bank with a lawsuit alleging that it was using the space for criminal activity. Mr. Solow lost the case.
The health of the 81-year-old Mr. Solow, who has a history of heart troubles, recently took a turn for the worse, according to people close to Mr. Solow. He has for now turned over the business to his son Stefan and an outside consultant. They have hired broker CB Richard Ellis Group Inc. to lease the building.
Sheldon Solow and Stefan Solow didn't return telephone calls seeking comment.
Despite the vacancies, the Solows aren't in danger of defaulting on the property's $400 million mortgage. In 2007, the building was appraised at $2.2 billion, according to loan-data provider Trepp LLC. Even at an occupancy rate of 53% as of October, the building generated $35 million in net operating income during the first nine months of 2009, according to Trepp, more than enough to cover debt service. But in 2008 the building earned nearly double that.
"Nine West 57th Street is one of the premier pieces of real estate in the world and should be at the highest price of any office space in the city," said Peter Riguardi, president of New York operations for real-estate brokerage Jones Lang LaSalle. But "I think that there's been a perception in the marketplace that doing business with the Solows is difficult."
Mr. Riguardi said there's an effort to change that perception. He says he recently met with Jay Fischoff, the outside adviser hired to help manage the building. "They're trying to be a little bit more tenant-friendly and broker-friendly," Mr. Riguardi said.
Despite 13 football fields of empty space, 9 West retains an exclusive aura. Cellphone use is banned in the hushed, sparse, marble-clad lobby. Tenants are denied access to the elder Mr. Solow's private art gallery, which occupies what would be prime retail space on the ground floor. Through glass windows, pedestrians can view the prodigious collection, which includes a Miro, a Matisse, and a Henry Moore sculpture.
For now, private-equity and hedge-fund executives, whose money-management empires can afford the steep rent, occupy much of the building. Hedge fund Och-Ziff Capital Management Group occupies three floors. Apollo Global Management, run by billionaire Leon Black, occupies 2½ floors. Among the building's newest tenants is private-equity firm Providence Equity Partners, which late last year took over the entire 47th Floor at about $200 a square foot.
Bank of America's departure from the 9 West space has had a big effect on the building's overall vacancy rate. The bank once occupied 14 floors in the building, but has since consolidated most of its New York employees inside an office tower on Sixth Avenue.
In a lawsuit, Mr. Solow alleged that Bank of America made structural changes to the building's floors without his permission, according to people familiar with the situation. He sued the bank, seeking to evict it on the grounds that it engaged in illegal conduct. He cited a 2003 case in which state prosecutors charged one bank employee with improper trading practices. The court rejected Mr. Solow's lawsuit, ruling that the alleged improprieties "were largely carried out by a single member of the tenant's substantial on-site work force."
Last week, Citigroup Inc. won a court ruling allowing it to collect $85.7 million from Mr. Solow. The bank sued Mr. Solow in 2008, accusing him of failing to make payments on a roughly $500 million line of credit it had provided Mr. Solow for the development of a large plot of land in Manhattan along the East River.
Mr. Solow has had other difficulties. In 2008 his longtime lawyer Marc Dreier admitted to a scheme to sell to hedge funds $380 million in bogus promissory notes issued by Mr. Solow's company, Solow Realty & Development Co. Mr. Dreier, who is serving 20 years in federal prison, defrauded at least one hedge fund by holding a meeting with it in Mr. Solow's conference room on the 45th floor
Mr. Solow grew up in Brooklyn, the son of a bricklayer. He dropped out of New York University to try his hand at real-estate development. In the late 1960s Mr. Solow snapped up 17 parcels on 57th Street and eventually commissioned architect Gordon Bunshaft to design the tower.
An early tenant was a shoe company whose founders, after being unable to agree on a name for a new brand, settled on their address—Nine West. They even used an outline of the iconic, red "9" sculpture perched on the sidewalk as their logo. As the brand expanded, Mr. Solow tried to stop them, recalls Jerome Fisher, one of the company's founders, but it turned out that Mr. Solow hadn't secured the copyright.
"We were young and stupid and it didn't bother us," Mr. Fisher says.
In 1992, cable network Home Box Office Inc. filmed the movie adaptation of "Barbarians at the Gate," the best-selling book about the RJR Nabisco takeover. HBO executives asked Mr. Solow permission to film the building's facade and "9" sculpture. He demanded a $150,000 fee. HBO balked and instead built its own red "9," plopped it in front of a similar-looking building on West 42nd Street and used that for the exterior shot instead.
"Sheldon treated the building like it was a movie star," said Michael Fuchs, who was HBO's chief at the time.
Three years later, when Mr. Fuchs was ousted from Time Warner Inc. in a boardroom battle, he negotiated a legendary exit package. Among its perks: his own office suite, paid for by Time Warner, on the 42nd floor of 9 West 57th.
It would be understandable if lower Manhattan simply up and quit. Its status as the center of the financial world and corporate America itself has been on the wane for half a century. Then it was hit with 9/11, a credit crisis that laid Wall Street flat, and a long, brutal recession.
Finally, the real estate market at the southern tip of the island is showing signs of exhaustion. The office vacancy rate has increased to 8.1 percent from 7.7 percent at the end of last year, according to CBRE-Econometic Advisors. As 4.4 million square feet of new office space associated with the rebuilding of the World Trade Center site come on line in 2013, the vacancy rate in the city's oldest neighborhood could hit 14 percent, according to Robert McGrath of CBRE.
The surprising thing is, the experts view the coming dip as just one more cycle in the up-and-down history of the area. They are continuing to plan and to build, so that they can be ready for the next leg up, which they expect to occur in a few years. Kenneth McCarthy, head of Cushman & Wakefield’s New York research unit, stresses that the “important thing to remember is that downtown is still a vital market that will once again become, one of the best markets in the United States.”
Why the optimism? Part of it is timing. When examining the downtown market, McCarthy says it is important to understand that it almost always lags Midtown. Downtown doesn’t begin to see significant pressure on vacancy, which in turn puts downward pressure on rents, until after the same turn has occurred in Midtown. Right now, he says that that there’s an emerging consensus among real estate players that Midtown has probably reached its bottom.
Downtown still has a ways to go before beginning any semblance of a climb back up.
“I think we’re going to come off (rents) a bit more, “said McCarthy. He noted that as of February 2010, asking rents downtown averaged around $39.43 per square foot. That’s down 22 percent from a peak of $50.89 in Sept 2008.
Commanding much of the attention downtown: the years-long dispute between World Trade Center developers Silverstein Properties and the land owners at Ground Zero, the Port Authority of New York and New Jersey. But, with the latest arbitration agreement, much appears to have changed. In 2013, the Port Authority’s One World Trade Center will add 2.6 million square feet of new space to the downtown market, while Silverstein’s second tower will add 1.8 million. As part of the agreement, a third building could be built if Silverstein raises $300 million in capital and rents around 20 percent of the available space.
Silverstein president Janno Lieber adds that there are a number of other reasons why developers are bullish on Downtown. For one, he points out that despite a soured economy, Downtown has the lowest vacancy of any commercial business district in the nation. The national average is 16.3 percent. The vacancy rate in Midtown is currently 10.5 percent.
The neighborhood also benefits from a wide variety of stock. Over 65 percent of Manhattan’s office stock is 50 years old or more. And, since downtown was the principal business district in Manhattan until the years of the Great Depression, its stock of older buildings is disproportionately higher.
And as a result of 9/11, the area lost 14 million square feet of class A office space. The new office space that is being built and the vintage buildings in the area serve different markets. loss of 14 million SF of new class A office space downtown. As Leiber says, “Companies that are willing to relocate into a 60 or 70 year old building, are not the same firms that will sign a lease at the new World Trade Center site.”
ALBANY — More than $2 billion in state aid payments to public school districts across the state are being delayed, possibly until June, because of the state's worsening financial crisis, Gov. David A. Paterson said Tuesday.
The governor's order, coming the day before the aid was to go out, left school districts scrambling, with talk of program cuts, delayed payments to vendors and possible layoffs if the expected state aid — approved a year ago in the 2009 budget — does not come soon.
Several school officials lashed out at the Paterson administration for giving just 24 hours' notice and shifting the state's cash-flow problems onto local districts. A top labor leader predicted some schools — especially lower-income districts that rely heavily on state aid — will have to cancel school days if they can't pay the bills.
The delay will cost the Buffalo school district $26 million it was expecting Tuesday.
The Paterson administration also sent word Tuesday to construction companies doing business with the state that road and other capital work will be delayed in the weeks ahead until a new state budget deal is reached at the Capitol.
Department of Transportation officials said among the projects being held up will be the $50 million reconstruction of Fuhrmann Boulevard into a new Outer Harbor Parkway, the final phase of which just began in October.
A full list of DOT delays will be released today, officials said; the delays will hit any state agency doing construction work that is not funded with federal stimulus money or is not of an emergency, health-related nature.
The governor said the school payments might not be made until June 1, if the state has the available money. He said his hands were tied because the state's 2009 fiscal year — which ends today — needed to be in balance. Paterson also is trying to cut payments to schools in the coming year to help Albany close a mounting deficit.
"The fact that extraordinary cash-management actions such as these are necessary underscores the dire nature of our state's fiscal circumstances," Paterson said. He blamed a "severe" cash-flow problem facing the state.
The $2.1 billion in delayed payments, which could result in school districts cutting programs or staff, come after Paterson in December delayed $582 million in scheduled state payments to the state's nearly 700 school districts. That was part of a total payment delay of $750 million that also included funding for local governments and not-for-profit service providers.
The latest school payment delay is more than three times larger than the December level and is coming much later in the school districts' fiscal year, which ends June 30. It also will be longer than the one-month delay that Paterson promised in December. State law permits the governor to delay the payment due today until June 1.
The March 31 payment has been made on time every year except 2003 since the state moved the payments to that date in the early 1990s, according to Robert Lowry, deputy director of the New York State Council of School Superintendents.
Lockport school officials learned about the delay in their $3.4 million state aid payment from a reporter, not the state. Lockport Superintendent Terry Ann Carbone said the district might have to look at a whole range of solutions — from delaying vendor payments to undertaking short-term borrowing that comes with expensive interest costs — to cover the lapsed state aid.
"To get such short notice could be devastating to a district," Carbone said. "Surely, this is a very serious time for public education, and I just hope that we don't lose sight of the fact that educating our children is probably the most important thing we could be doing in the state."
Buffalo school officials did not respond to requests for comment.
Other payment delays include $4.4 million for Niagara Falls, $4.6 million for West Seneca, $3.6 million for Lancaster, $2.5 million for Hamburg and $2.7 million for North Tonawanda.
Funding for public schools has become a major sticking point in negotiations for a new 2010 budget. The deadline for on-time adoption is today, but Paterson and lawmakers will again miss the target. Lawmakers are on a break for the religious holidays, and talks have broken down over spending, tax hikes and borrowing plans.
In his budget plan for 2010, Paterson proposed slashing school aid by $1.4 billion, a level backed by Senate Democrats. Assembly Democrats offered $800 million in education cuts. The state spends more than $20 billion a year on public schools.
Schools are already preparing for cuts from Albany for the coming school year. Many have drafted budgets based on Paterson's $1.4 billion cut. Buffalo school officials have said they might have to lay off 680 workers if the governor's cut is adopted in the final budget deal.
Richard Iannuzzi, president of the New York State United Teachers union, called Paterson's last-minute payment delay "immoral" and said it could force schools to cut bus services and "shut doors early if they can't meet payroll."
"It's unconscionable to pull the rug out from under school districts," he said.
The payment delays came as a conservative think tank released a report showing a surge in teacher and other school district hiring over the past decade even as student enrollment dropped.
Between 2000 and 2009, districts across New York added 14,746 teachers and 8,655 nonteaching professionals, such as administrators, guidance counselors, social workers and nurses. During the same period, statewide enrollment dropped by 121,280 students, according to a report by the Empire Center for New York State Policy.
The group said upstate schools saw the sharpest enrollment drop — 72,000 students — yet added 939 teachers and 2,408 other professionals. It said upstate enrollment dropped by 7.4 percent while teacher hiring was up 1.1 percent and other professional hiring leaped 19 percent. The group said about half the additional teachers were for special education programs.
School groups in recent weeks have said proposed state aid cuts could lead to more than 10,000 layoffs at districts. One lawmaker, Assemblyman Sam Hoyt, D-Buffalo, called on NYSUT, the teachers union, push local affiliates to accept pay freezes for teachers this year; NYSUT rejected the idea.
On the delay in construction projects around the state, officials said it was necessary because there is no appropriation for capital projects in the emergency spending bill approved by the Legislature this week to cover up to April 14.
Paterson had vowed to propose only a bare-ones emergency bill — needed for things like paying for Medicaid services and state worker paychecks — covering up to April 14.
The emergency bill is necessary because of the failure to agree on a full year's budget.
The governor used the school payment delay to again lecture the Legislature on the need for fiscal discipline. He has said plans by the two Democratic-run legislative houses do not cut enough to help erase the state's $9.2 billion deficit; Paterson and lawmakers are more than $1 billion apart in spending cuts, and he is resisting Assembly calls for $2 billion in borrowing to close the gap.
Paterson warned revenues to the state are dropping at levels that even deeper cuts than he proposed in January for the 2010 budget may be necessary. "In order to reach a consensus budget agreement, all sides must come together as soon as possible and make the tough choices necessary to reduce spending to more affordable levels," Paterson said.
AMY GOODMAN: The Obama administration has announced changes to its signature foreclosure prevention program, Making Home Affordable. The initial foreclosure relief program unveiled a year ago was supposed to help up to four million struggling homeowners. So far fewer than 200,000 borrowers have been granted permanent loan modifications. Meanwhile, a record 2.8 million properties with mortgages received foreclosure notices last year, this according to RealtyTrac.
The steps announced Friday would broaden the program to include people who’ve lost jobs, encourage lenders to reduce the principal balances on problem mortgages, and help refinance borrowers who are “underwater,” or owe more than their homes are worth. But will these changes help stem the tide of foreclosures?
In a statement this weekend, economist Dean Baker said the plan was well-intentioned, but the winners are likely once again to be the banks. Baker is the co-director of the Center for Economic and Policy Research and the author of a number of books, his latest called False Profits: Recovering from the Bubble Economy.
He joins us now from Washington, DC, and then we’ll go to Tavis Smiley in Burbank, California, to talk about President Obama’s trip to Afghanistan.
But Dean Baker, one in five American homeowners are now underwater? What does that mean? And talk about what the Obama administration plans to do about it.
DEAN BAKER: Well, the basic story is, we had a housing bubble, prices have fallen, they’re continuing to fall, and we had a situation where people were borrowing very heavily both to buy their homes and also, in many cases, they were taking equity out of their homes. That was a reasonable thing to do if the bubble was real, in other words, if prices were going to continue to rise, as people like Alan Greenspan and Ben Bernanke were telling them. So now that prices have reversed, we have this situation where all these people owe more than the value of their house.And the important thing, and this is just amazing to me, that no one seems to want to talk about the bubble, even after it’s wrecked the economy, put us in this situation. And they design a housing plan that acts as though there was no bubble, there is no bubble, there’s no problem with house prices falling. Now, house prices are virtually certain to continue to fall, not everywhere, but in very many of these markets. So, if we have a homeowner who’s underwater, their house price is going to fall further, we get the federal government to give some money to the banks to allow them to stay in their home another year or two years. Well, odds are that we aren’t really helping that person. They’re paying more on their mortgage than they would to rent the same house. And on top of that, at the end of the day, they’re going to end up with no equity in their home anyhow. So I don’t quite understand what’s wrong with people in this town, that you had an $8 trillion bubble, it wrecked the economy, the worst downturn since the Great Depression, and people still can’t talk about the bubble. It’s bizarre.
AMY GOODMAN: So talk about exactly what the plan is, who it will help and who it won’t help.
DEAN BAKER: Well, it’s a—first off, I mean, the important thing to understand is everything here is voluntary on the part of lenders, so it sets up a formula where, if lenders reduce principal, in some cases, that the government will issue a new mortgage, or I should say guarantee a new mortgage, at a lower principal. So say someone currently owes $300,000 on a home that we’ll say is worth $250,000. If the bank is willing to issue a new mortgage at, let’s say, $250,000—it’d be a little less, say $240,000—then the Federal Housing Authority will guarantee that new mortgage. So that would mean the person will be paying less than their mortgage each month. In principle, they could come out ahead. But again, in many of these markets, prices are still falling. So let’s say the home’s worth $250,000 today. A year from now it might be worth $225,000. And at that point, the person is again underwater, and the taxpayers are on the hook for the difference. Haven’t helped the person, you’ve helped the bank.
Higher charges at peak periods among raft of Toronto bill increases
Get ready for a jolt from your electricity bill, as a series of rate increases converge.
As Toronto Hydro switches its customers to time-of-use rates – which mean higher prices at peak periods – 92 per cent have seen the energy portion of their bill rise by about 7 per cent, said Toronto Hydro chief executive Anthony Haines. The average jump was $2.38 a month.
Starting July 1, the new, blended harmonized sales tax (HST) will be added to hydro bills, which previously were exempt from provincial sales tax.
That will push the total bill up another 8 per cent overall, or close to $8 a month.
Ontario Power Generation has announced it's applying for a 9.6 per cent rate increase for its portion of the bill that will add about $2.75 a month to a typical bill. And Toronto Hydro has applied for an 8.7 per cent rate increase for its portion of the bill, which will add another $2.43 a month.
The province has added a fee to boost conservation that will add another $4 a year to a bill, or about 33 cents a month.
The total is an increase of about $15 a month, based on an average monthly bill of about $100. That assumes the customer uses about 800 kilowatt hours a month.
Figures are based on experiences of 10,000 households that were the first to switch to time-of-use rates.
Most customers are now on time-of-use rates.
And the rest will be switched shortly. (Customers who have contracts with retailers will pay the contracted price, not the time-of-use rate.)
The numbers are subject to change because the Ontario Energy Board hasn't yet approved the Toronto Hydro and OPG rates. And the structure of winter rates – which is when these bills were recorded – is different from summer. The summer impact of time-of-use rates may be less pronounced.
Time-of-use rates mean that the price rises to 9.3 cents a kilowatt hour at peak periods and falls to 4.4 cents when demand is low – overnight and on weekends.
There's also a mid-peak price range of eight cents.
Time-of-use rates are supposed to encourage customers to use less power during peak periods.
But Haines said that hasn't happened yet. In fact, peak usage rose slightly among the first customers who were switched to time-of-use rates.
Haines said as customers study their new bills and look at the new rates, they'll get a chance to react and switch some of their power usage to off-peak hours.
"The price signal has been sent. I know Torontonians will respond, but they need to see that higher price point coming through," he said.
New "smart" meters have been installed across the city that enable the utility to charge time-of-use rates. The cost of installation – ordered by the province – was about $110 million.
Toronto Hydro and other utilities have programs to help customers decrease their use at peak times.
In Toronto, customers can get a device attached to their central air conditioner allowing the utility to switch it off for short periods when the system is under strain.
About 61,000 Toronto households have one; they save 60 megawatts of power at peak periods, said Haines. There's a potential for installing 200,000 of the devices, which theoretically could trim demand by 200 megawatts.
That's 37 per cent of the output of the Portlands generating station.
LONDON (AP) - Struggling music group EMI faces being taken over by its bankers after failing to clinch a deal to sell the North American distribution rights for its artists to Universal Music Group or Sony Music.
EMI, which has the Beatles, Coldplay, Lily Allen and Pink Floyd on its books, had hoped to raise around 200 million pounds ($304 million) by offering its rivals a five-year licensing contract.
A source close to both sets of talks, who requested anonymity because the discussions were private, said Thursday that they fell apart after a failure to agree on price. EMI declined to comment.
The collapse of talks leaves EMI battling to raise 120 million pounds by mid-June to meet its commitments on loans from U.S. bank Citigroup.
If funds can't be raised from investors and the loan goes into default, Citigroup could seize EMI and cause it to be sold or broken up.
EMI has been struggling to stay afloat since it was bought by private equity firm Terra Firma Capital Partners for 4.2 billion pounds on the eve of the credit crunch in 2007, saddling the company with debt.
Several big-name acts, including Radiohead and the Rolling Stones, quit the label amid the cutbacks and restructuring that followed.
Terra Firma, led by British financier Guy Hands, still owes some 3 billion pounds to Citigroup because of the deal and relations between the two have soured.
Hands is suing Citigroup in New York, alleging that the bank falsely claimed there were other bidders for EMI, encouraging the private equity firm to raise its own offer. Citigroup has denied the allegations.
EMI has fared worse than the three other major labels - Universal, Sony BMG and Warner Music Group - amid the decline of CD sales and the rise of digital music downloading.
Analysts have blamed Hands' relative inexperience in the music business for exacerbating the company's decline.
EMI earlier this year put its iconic Abbey Road studios up for sale after reporting a pretax loss of 1.7 billion for the year to March 31, 2009.
However, it shelved those plans after a public outcry led to the site being put on a protected list by English Heritage and said it would instead seek an investor to help rejuvenate the loss-making studios.
Adding to the company's woes, Pink Floyd successfully sued the company for selling individual tracks digitally and Chief Executive Elio Leoni-Sceti quit the group last month after just 18 months in the job.
Like Hands, Leoni-Sceti, who joined the company from consumer products group Reckitt Benckiser, had found his music industry experience questioned.
Charles Allen, the former chief executive of broadcaster ITV PLC, who was EMI's non-executive chairman, filled the vacancy by taking over as executive chairman.
One yardstick by which to measure the decay in our country’s political, economic, and cultural life, is the answer to this question: Do the forces of power, which have demonstrably failed, become stronger after their widely perceived damage is common knowledge?
Economic decay is all around. Poverty, unemployment, foreclosures, job export, consumer debt, pension attrition, and crumbling infrastructure are well documented. The self-destruction of the Wall Street financial giants, with their looting and draining of trillions of other people’s money, have been headlines for two years. During and after their gigantic taxpayer bailouts from Washington, DC, the banks, et al, are still the most powerful force in determining the nature of proposed corrective legislation.
“The banks own this place,” says Senator Richard Durbin (D-IL), evoking the opinion of many members of a supine Congress ready to pass weak consumer and investor protection legislation while leaving dominant fewer and larger banks.
Who hasn’t felt the ripoffs and one-sided fine print of the credit card industry? A reform bill finally has passed after years of delay, again weak and incomplete. Shameless over their gouges, the companies have their attorneys already at work to design around the law’s modest strictures.
The drug and health insurance industry, swarming with thousands of lobbyists, got pretty much what they wanted in the new health law. Insurers got millions of new customers subsidized by hundreds of billions of taxpayer dollars with very little regulation. The drug companies got their dream—no reimportation of cheaper identical drugs, no authority for Uncle Sam to bargain for discount prices, and a very profitable extension of monopoly patent protection for biologic drugs against cheaper, generic drug competition.
For all their gouges, for all their exclusions, their denial of claims and restrictions of benefits, for all their horrendous price increases, the two industries have come out stronger than ever politically and economically. Small wonder their stocks are rising even in a recession.
The junk food processing industry—on the defensive lately due to some excellent documentaries and exposes—are still the most influential of powers on Capitol Hill when it becomes to delaying for years a decent food safety bill, using tax dollars to pump fat, sugar and salt into the stomachs of our children, and fighting adequate inspections. Over seven thousand lives are lost due to contaminated food yearly in the US and many millions of illnesses.
The oil, gas, coal and nuclear power companies are fleecing consumers and taxpayers, depleting and imperiling the environment, yet they continue to block rational energy legislation in Congress to replace carbon and uranium with energy efficiency technology and renewables.
Still, even now after years of cost over-runs and lack of permanent storage for radioactive wastes, the nuclear industry has President Obama, and George W. Bush before him, pushing for many tens of billions of dollars in taxpayer loan guarantees for new nukes. Wall Street won’t finance such a risky technology without you, the taxpayers, guaranteeing against any accident or default.
Both Democrats and Republicans are passing on these outrageous financial and safety risks to taxpayers.
Congress, which receives the brunt of this corporate lobbying—the carrot of money and the stick of financing incumbent challengers—is more of an obstacle to change than ever. In the past after major failures of industry and commerce, there was a higher likelihood of Congressional action. Recall, the Wall Street and banking collapse in the early 1930s. Congress and Franklin Delano Roosevelt produced legislation that saved the banks, peoples’ savings and regulated the stock markets.
From the time of my book, Unsafe at Any Speed’s publication in late November 1965, it took just nine months to federally regulate the powerful auto industry for safety and fuel efficiency.
Contrast the two-year delay after the Bear Stearns collapse and still no reform legislation, and what is pending is weak.
Yet the entrenched members of Congress, responsible for this astonishing gridlock, are almost impossible to dislodge even though polls have Congress at its lowest repute ever. It is a place where the majority is terrified of the corporations and the minority can block even the most anemic legislative efforts with archaic rules, especially in the Senate.
Culturally, the canaries in the coal mine are the children. Childhood has been commercialized by the giant marketers reaching them hour by hour with junk food, violent programming, video games and bad medicine. The result—record obesity, child diabetes and other ailments.
While the companies undermine parental authority, they laugh all the way to the bank, using our public airwaves, among other media, for their lucre. They can be called electronic child molesters.
We published a book in 1996 called Children First!: A Parent’s Guide to Fighting Corporate Predators in the Media. This book is an understatement of the problem compared to the worsening of child manipulation today.
In a 24/7 entertained society frenetic with sound bites, Blackberries, iPods, text messages and emails, there is a deep need for reflection and introspection. We have to discuss face to face in living rooms, school auditoriums, village squares and town meetings what is happening to us and our diminishing democratic processes by the pressures and controls of the insatiable corporate state.
And what needs to be done from the home to the public arenas and marketplaces with old and new superior models, new accountabilities and new thinking.
For our history has shown that whenever the people get more engaged and more serious, they live better on all fronts.