JOBS - The Half-Life of Hula Hoops & Typewriters

Let’s talk about just HOW our government 'creates' jobs, shall we?
In case you hadn’t noticed we had a rising standard of living when our factories were booming; such as is being experienced even now by Asian manufacturing countries. Before we totally ‘lawyered up’ our country, we had a ‘can do’ attitude. Between the lawyers and insurance companies our consciousness has transmogrified to ‘We'd better not’, and our abilities to ‘we can’t make that here, anymore’.
In case you hadn’t noticed, we are ‘outsourcing’ our manufacturing to (Eastern?) countries with cheap labor, that don’t have all the restrictions and or rights we have in place here, not to mention the tax incentives. Consequently one must look long and far to find something that is actually made in America, anymore, and not just assembled here.
In case you hadn’t noticed, beside fancy weaponry, GMO factory farms, and pharmaceuticals for every malady and occasion, we don’t really make anything here anymore; we have transitioned into one big tourist/service country. In case you hadn’t thought about it, just HOW does the government ‘create JOBS’? Aren’t most jobs created by ‘small businesses’? So where does the government get off saying they created new jobs?
Furthermore, to create a truly NEW job, and restore some semblance of manufacturing to America, one must get a patent to market. As of now, it is increasingly impossible for an individual to do so. A patent may cost at least $50,000. and as a patent lawyer once said "A Patent is just an invitation to a law suit". Once the patent is obtained, it is 'goodbye and good luck', they don't even give you a free map.! Does this approach make any sense if we rely on NEW products for manufacture?
To make matters worse, in this country there is no PROCESS to get ideas to market. Shark Tank and H2’s invention USA are hardly a process, let alone dignified. For such a necessary creative process to develop a "product' to manufacture - for our economic growth, These shows are not much of an improvement over the present chestnut about ‘finding an angel' (Vulture capitalist) or licensing it to a manufacturer - There AREN'T any left, and those that are, want to feed on the carcass.
On one hand a State Senators told me that "They don't get involved in private businesses", and was giving speeches the next week at GE about 'saving jobs'. Congress seems to not disapprove of kinda starting wars, to kill the maximum number of people possible anywhere, under any circumstances, and act like any death in the homeland is a tragedy that knows no bounds, and they can't understand why anyone would kill another person, then they think we're all crazy, and want to take away all sharp objects from us.
Think of it this way - Car Maker "V" opens 2 plants in America. The government jumps up and claims credit for the jobs. (The finance report about how the government had to sweeten the deal with our tax dollars is not mentioned at this point) However that isn't really a NEW job as now, not only are these two plants battling against each other, they are competing with every other car manufacturer in the world. When the inevitable Segway comes out that goes 80 mph in comfort, and enclosed, all the car companies might as well be making typewriters.
The issue is this: Every manufactured product has a half-life then fades from use. Take Hula hoops as an example; They pumped them out like no tomorrow until the marked was saturated. They made NEW JOBS by bringing something NEW to market, and sold 100 million in the first two years! Typewriters had a good (120 year) run until computers sent them on their way. People who have their 'Eureka' moment need development, not exploitation and obstacles.
Obviously Asia has electronics sewn up (and clothes) at this time. We need to stoke up those old factories and give them new purpose. That would be 'creating NEW jobs'.
THEREFORE: If we want to regain even some of our neglected manufacturing industry, we need to pay attention to one of our main national resources, inventiveness. It is a resource that cannot be produced on demand, let alone recognized by most typical bureaucrats. We used to be known for our 'inventiveness and ingenuity', we still have it, we just have to free up the process, and let our nature take its course.
We can do better than a country with only minimum wage service jobs, or pushing papers for intrusive government jobs. That is not a plan, it is wishful thinking. or make-work.

Putting A Trillion Dollars Of Platinum In Perspective

So you want a trillion dollar platinum coin? Ok: here are some facts:

• Platinum has traditionally been the most valuable precious metal for one simple reason: it is rare.
• It is so rare, that all the platinum ever mined could fit into a 25 cubic foot box.
• The weight of that box comes out to just over 16 tons: this is how much platinum has been mined since the start of time.
• A coin valued at $1 trillion and made out of platinum would, at today's price of $1557/ounce, weigh in at 642.3 million ounces.
• 642.3 million ounces is also roughly 18 thousand tons, or about 1100 times more than all the platinum mined.

In other words, putting a coin that is worth $1 trillion in perspective to all the platinum ever mined, would look something like this:

Now, putting the sheer legal idiocy of the proposal aside, and CNBC's John Carney has written a good article about why it is indeed, legal idiocy, the simple reality is that for this retarded idea to work, there has to be some justifiability, or even remote credibility of the "legal tender" backing the value. Sadly as the chart above shows, there can't possibly be such justifiability.
Or can there?
Remember, as we said, the chart above is indicative of reality at today's prices. So if the Treasury plans on literally coming up with ridiculous laws, what is there to prevent it from merely coining a one ounce, or half an ounce, or one gram Platinum coin and assigning it the value of $1 trillion.
Sure it can. There is a problem with that, however: it is called currency devaluation and is also what FDR did with executive order 6102 when he confiscated America's gold - he basically devalued the US Dollar by well over half overnight (which, for all those curious, is the endgame in the current depression also, but we'll cross that bridge when we get to it).
In other words, when one strips away with all the rhetoric, all the advocates of this insidiously stupid idea which gets a new life every time there is a debt ceiling crisis, are doing, is arguing for a massive devaluation of the dollar: because for the trillion dollar coin idea to be even remotely plausible, the price of Platinum, and by implication the entire precious metals complex, would have to go up by a factor of some 1,100.
It also means the value of the paper US currency would have to go down by 1,100.
Which, by the way, is precisely what all those who wish for the Fed to continue funding America's unprecedented spending binge, which can never be satisfied by taxes alone, are hoping for.
And of course, they will eventually get it.

Bank Of America's $12 Billion Fraud Settlement With Fannie

"We thought this would be dragged out at least another two years."
Good discussion yesterday on Bloomberg.  FBR banking analyst Paul Miller on BofA's agreement to pay Fannie Mae $11.7 billion to resolve home-loan repurchase claims.
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BofA Settles Fraud With Fannie Mae For $12B, Moynihan Escapes Countrywide
Bloomberg
Bank of America will make a $3.6 billion cash payment, spend $6.75 billion to buy back residential loans sold to Fannie Mae, and pay $1.3 billion in fees for taking too long to assist or foreclose on overdue borrowers, according to separate statements.  Even after these costs and an additional $2.5 billion for expenses that include litigation and a separate regulatory settlement, the Charlotte, North Carolina-based lender said the fourth quarter was “modestly” profitable.
It’s the latest effort by Chief Executive Officer Brian T. Moynihan to cap the damage caused by his predecessor’s takeover of Countrywide Financial Corp. and its defective subprime home loans.  Before today, the bank committed more than $40 billion since 2007 to cover the costs of refunds and litigation tied to faulty mortgages and foreclosures.  Much of that sum went to the government-sponsored entities of Fannie Mae and Freddie Mac.
“This does put the GSE stuff behind it,” said Paul Miller, an FBR Capital Markets Corp. analyst who has a hold rating on Bank of America shares. “We thought this would be dragged out many years, or at least another two years.”
Continue reading...

Health Insurance Premiums Sky Rocket Ahead Of Obamacare Law Kicking In

Health Insurance Premiums Sky Rocket Ahead Of Obamacare Law Kicking In

Bank Of America On The "Trillion Dollar Tooth Fairy" Straight "From The Land Of Fiscal Make Believe"

A year ago, out of nowhere, the grotesque suggestion to "resolve" the US debt ceiling with a platinum dollar coin came, and like a bad dream, mercifully disappeared even as the debt ceiling negotiations dragged until the last minute, without this idea being remotely considered for implementation, for one simple reason: it is sheer political, monetary and financial lunacy. And yet there are those, supposedly intelligent people, who one year later, continue dragging this ridiculous farce, as a cheap parlor trick which is nothing but a transparent attempt for media trolling and exposure, which only distracts from America's unsustainable spending problem and does nothing to address the real crisis the US welfare state finds itself in. And while numerous respected people have taken the time to explain the stupidity of the trillion dollar coin, few have done so as an integral part of the statist mainstream for one simple reason - it might provide a loophole opportunity, however tiny, to perpetuate the broken American model even for a day or two, if "everyone is in on it." Luckily, that is no longer the case and as even Ethan Harris from Bank of America (a firm that would be significantly impaired if America was forced to suddenly live within its means), the whole idea is nothing more than "the latest bad idea" straight "from the land of fiscal make believe." We can only hope that this finally puts this whole farce to bed.
From Bank of America:
The trillion dollar tooth fairy
From the land of fiscal make-believe
The budget skirmishes over the past few years have spawned a lot of bad ideas. The latest is that the US Treasury issue a trillion dollar coin to get around the debt ceiling. We see several problems with this plan. First, its legality is open to question. Second, it would worsen the coming battle over spending cuts. Moreover, it would further deepen the distrust between the two political parties. Finally, it risks being the first step down a slippery slope of debt  monetization.
Finding change in the Treasury’s sofa
A hot idea for resolving the fiscal crisis is for the US Treasury to issue a trillion dollar platinum coin in order to avoid the looming debt ceiling. The idea  comes from a broad interpretation of law that gives the Treasury secretary the ability to mint and issue commemorative platinum coins “in such quantity and of such variety as the secretary determines to be appropriate.”
The trillion dollar coin plan work as follows: the Treasury would deposit this coin at the Fed, which acts as the Treasury’s banker. The Treasury then could draw upon its account to pay for outlays. This action would allow funding for an additional trillion dollars of spending without having to worry about raising the debt ceiling, buying another year of breathing room. If the debt ceiling isn’t raised a year from now, then presumably the Treasury could mint another coin.
Wouldn’t this action be massively inflationary? Proponents argue no. With the economy operating below potential, allowing this already-authorized spending to occur would prevent a further collapse in aggregate demand. Were the Fed concerned about possible inflation, it could “sterilize” the impact by selling from its existing stock of bonds. In the limit, the Fed could sell a trillion dollars worth of bonds — that should squelch any inflationary impetus and remove any hint of outright debt monetization, according to supporters.
More debt limit desperation
This plan is just the latest in a string of “solutions” to the debt crisis. In the summer of 2011, several ideas were floated to get around the debt ceiling altogether. One proposal was for the Treasury to sell gold holdings to the Fed in exchange for cash. A second was for the Fed to simply extinguish some portion of its Treasury debt holdings. With one stroke of the pen, it would wipe out a big chunk of the debt and allow the Treasury to issue more. A third idea — which is making a bit of a comeback among some commentators — is to invoke the 14th amendment and declare the debt ceiling unconstitutional, as “the validity of the public debt of the United States … shall not be questioned.” Others took a different tack, and argued the US should just default to force a compromise. Thankfully, none of these options were seriously pursued at the time.
A wooden nickel
If this trillion dollar idea sounds a bit too good to be true, it is.
First and foremost, it may not be legal. The idea effectively rests on a loophole in a law that allows platinum coins to be issued by the Treasury — but for
commemorative, not fiscal, purposes. Opponents suggest that the courts would strike down this plan since it is not the intent of the original bill. Others have questioned its constitutionality: they argue that Congress cannot (and did not intend to) delegate fiscal decisions to the Treasury. That is, the Treasury must implement the spending and tax — and debt limit — decisions of the Congress, not override them. However, opinions are mixed as to whether these criticisms would be enough to invalidate the trillion dollar coin idea in a court of law.
Whether legal or not, it would almost certainly provoke a bitter court battle. And at least one Republican representative, Greg Walden of Oregon, has said he would propose legislation to preclude the trillion dollar coin plan. While the Obama administration so far has not commented on the idea, in 2011 it rejected on legal grounds the idea of invoking the 14th amendment to avoid a debt limit battle. However, in early January House Minority Leader Nancy Pelosi said she would be willing to invoke the amendment “in a second.”
Platinum-gilded problems
Taking these sorts of actions would almost certainly worsen, not ease, the coming battles over the spending — a second reason to be skeptical of the idea of the trillion dollar coin. As we have noted before, the debt ceiling is just one of three brinkmanship moments looming in the next few months. The across-the-board spending cuts that constitute the sequester have only been delayed for two months, and absent new legislation, will start in March. Even more troubling, on March 27 the latest continuing resolution ends and, absent new legislation, all nonessential government programs would have to shut down for lack of funding.
Third, throwing the trillion dollar coin into this mix would not only intensify these two other fights, it would likely poison the well even further in future budget negotiations. With split government, fiscal policy making requires bipartisan agreement. The cliff compromise earned support from both parties, marking a welcome — if brief — respite from partisan politics. The last thing Washington needs is a further escalation in gamesmanship.
Finally, there is a slippery slope from avoiding the debt limit to outright debt monetization. Although proponents see it as a technical fix to a problem that, in their view, never should occur, it means the Treasury would have established a precedent to thwart Congressional limitations on spending and the debt ceiling.
Outside of the legal questions, nothing precludes the Treasury from issuing a coin to pay down the full $16.4 trillion in debt in one fell swoop: true monetization. A trillion dollar coin also would subvert the whole budget process, undermining already fragile public confidence and spooking financial markets. And based on the criteria put forth by the rating agencies, it would represent a stunning failure to devise credible political processes to resolve the longer-term budget issues for the US. A downgrade would very likely follow, in our view.
Besides, imagine the battles over whose portrait belongs on the face.

CNBC: Weisenthal Pushes $1 Trillion Dollar Coin

It's all politics aboard the U.S.S. Ponzi.
As a card-carrying Keynesian proselytizer, Joe Weisenthal is generally not willing to consider spending cuts, so Friday on CNBC he attempted to make the case for the $1 trillion platinum coin as a means for Obama to avoid a debt ceiling showdown with Republicans.
Joe makes his full case here...
Now, putting the sheer legal idiocy of the proposal aside, and CNBC's John Carney has written a good article about why it is indeed, legal idiocy, the simple reality is that for this retarded idea to work, there has to be some justifiability, or even remote credibility of the "legal tender" backing the value.  Sadly as the chart above shows, there can't possibly be such justifiability.  Unless...
So you want a trillion dollar platinum coin? Ok: here are some facts...
Bank Of America On The "Trillion Dollar Tooth Fairy" Straight "From The Land Of Fiscal Make Believe" | Zero Hedge
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The Welfare Bill: A government of millionaires just made the poor poorer - and laughed as they did it

A brutal assault from ideologically-crazed demagogues comes down to this: you have been mugged and therefore your less deserving neighbour should be mugged too.

 

David Cameron's invocation in the Commons of Michael Winner amuses George Osborne - while Nick Clegg looks less impressed

1 / 1

They cheered, they guffawed, they mocked. Picture the scene, and don't forget it as the next two and a half years of Cameron's Britain drag on: a smug pack of over-paid Tory MPs – some worth millions – sniggering as they prepared to slash the incomes of Britain's already struggling poor. Labour's Lisa Nandy and Ian Mearns pleaded with them in the Chamber, vainly, to stop laughing. Not since 1931 has a Government attempted to deliberately, consciously reduce the incomes of the poor. Oh, the hilarity.

The cap on in-work and out-of-work benefits is the culmination of a systematic campaign by the Tories and their media allies to turn large sections of the population against each other. “Strivers” versus “skivers” and “shirkers”; sinister images of the workshy and feckless with their curtains drawn: this is a near-daily diet of poison in Cameron's Britain. The substance of their argument is this: you have been mugged and therefore your less deserving neighbour should be mugged too. They said it to private sector workers about their counterparts in the public sector, attempting to stir up envy at their supposedly over-generous “gold plated” pensions and pay settlements. Now the Tories attempt to exploit the resentment of public sector workers languishing under a de facto pay cut they have imposed themselves. Where is the justice if we do not pick-pocket your neighbour, too, with this benefits cap? There is a Yiddish expression - “chutzpah” - for such unapologetic shamelessness.
A government of millionaires makes the poor poorer while trying to turn them against each other. And so a new generation learns to appreciate the passion behind Labour pin-up Nye Bevan's famed declaration in 1948 that the Tories are “lower than vermin”.
They jeer and they whoop now, but this is surely overreach. “Today Labour Are Voting To Increase Benefits By More Than Workers' Wages” is the latest Tory hit poster, claiming that they are “Standing Up For Hardworking People.” The Tories' recently hired arch-spinner Lynton Crosby has been quick to inject his own brand of bile into the Tory operation. But this divide-and-rule propaganda makes no sense. Both those who work for their poverty and those who are without a job are having their pockets emptied by a cabal of ideologically-crazed millionaires. It is quite true that both private and public sector workers have faced years of flatlining or declining wages. But now millions of them will be hit with reduced tax credits, too. They must not get away with playing off people receiving benefits and workers facing shrinking pay packets: they are one and the same. First you are mugged by your boss, then you are mugged by the Tories.
The baying of the Tories is loud enough; the voices of those affected have been all but airbrushed out of existence by the political establishment and a supine or sometimes criminally complicit media. Save The Children recently revealed a world that most of the commentariat don't even know – or want to know - exists: of parents choosing between heating their homes and feeding their kids; or skipping their meals to make sure their sons and daughters are nourished. Such is the conspiracy to deprive the electorate of the truth about the Government's onslaught on the welfare state that many don't even know they are about to be hit. With the Resolution Foundation projecting a 15 per cent decline in income for low earning families by 2020, they'll know soon enough. Research by the TUC last week showed that the more people know about the realities of the welfare state – about fraud, who gets benefits and how much they are really worth – the less likely they are to support Tory attacks. Here is the potential undoing of this vicious campaign.
And what of the Lib Dems? Granted, it is a question that answers itself. Four votes against and two abstentions excepted, every last yellow-bellied man and woman marched through the voting lobbies with their Tory masters to shrink the incomes of the poor. That includes Tim Farron, the posturing Lib Dem President who will undoubtedly one day attempt to claim the leadership of whatever remains of this disreputable, discredited party: he may well be able to drive his diminished parliamentary party around in a London cab after 2015, just like the good old days of British Liberalism. “Many of us have been fighting the corner of vulnerable people for months and months now,” he tweeted me before voting to slash their income, “And I'll keep doing that every single day.” I'd suggest he was Machiavellian, if I was not in danger of inventing strategic ability where there is none. More than any other Coalition policy, this scandalous, grubby episode has exposed a rootless party, devoid of principle, stuffed with vacuous non-entities and mealy-mouthed voting fodder for the worst attacks inflicted on the poor since World War II. No forgiving, no forgetting; the dustbin of history awaits them, and deservedly so.
This is not to let the Labour leadership off the hook. They were right to take on this cap – though, quite frankly, what is Labour for if it is not to defend the working poor and unemployed from Tory muggers? Yet it was a decision taken in the face of internal opposition behind the scenes from the party's Surrender Tendency. Former Home Secretary Jacqui Smith came out and openly savaged Ed Miliband for it. A period of silence would be most welcome, Jacqui.
But Labour's response will always be hobbled when it is delivered by the likes of Liam Byrne. The right have cheerfully dug out his own contributions to the vile attempts to turn the working poor against the unemployed: “Labour is the party of hard workers, not free-riders. The clue is in the name. The party that said idleness is an evil. The party of workers, not shirkers.” Or indeed: “Let's face the tough truth – that many people on the doorstep felt that too often we were for shirkers no workers.” The grotesque sight of a Labour politician – a Labour politician – parroting the divide-and-rule bile of Tory demagogues. Not only is it shameful, it is self-defeating: there is nothing the Tories desire more than for this “debate” to be framed on their terms. They watch in satisfaction as senior Labour figures fuel the fire about “scroungers”, knowing full well that the more it burns, the broader the pool of their own potential support. The Tories have a confident, clear, consistent message; exactly what is missing from their opponents.
Thieving from the poor while turning them against each other: any response but fury at what this government is doing is inexcusable. But it is not enough. This government – a government with a flimsy, pathetic excuse of a mandate – is intolerable, and it must be stopped in its tracks. No more silent simmering with rage. Demand the Labour leadership offer an opposition worthy of the name. Expose Tory lies at any and every opportunity. Give a platform to those battered by Tory savagery. Take to the streets. Strike, and support those who do. Learn from this country's proud history of peaceful civil disobedience. Sounds too radical, too extreme, or too much like hard work? In the years to come, you will be asked what you did to stop this horror show. And if you need another incentive, picture again those baying Tories, jeering as they mugged the poor. 

They cheered, they guffawed, they mocked. Picture the scene, and don't forget it as the next two and a half years of Cameron's Britain drag on: a smug pack of over-paid Tory MPs – some worth millions – sniggering as they prepared to slash the incomes of Britain's already struggling poor. Labour's Lisa Nandy and Ian Mearns pleaded with them in the Chamber, vainly, to stop laughing. Not since 1931 has a Government attempted to deliberately, consciously reduce the incomes of the poor. Oh, the hilarity.

The cap on in-work and out-of-work benefits is the culmination of a systematic campaign by the Tories and their media allies to turn large sections of the population against each other. “Strivers” versus “skivers” and “shirkers”; sinister images of the workshy and feckless with their curtains drawn: this is a near-daily diet of poison in Cameron's Britain. The substance of their argument is this: you have been mugged and therefore your less deserving neighbour should be mugged too. They said it to private sector workers about their counterparts in the public sector, attempting to stir up envy at their supposedly over-generous “gold plated” pensions and pay settlements. Now the Tories attempt to exploit the resentment of public sector workers languishing under a de facto pay cut they have imposed themselves. Where is the justice if we do not pick-pocket your neighbour, too, with this benefits cap? There is a Yiddish expression - “chutzpah” - for such unapologetic shamelessness.
A government of millionaires makes the poor poorer while trying to turn them against each other. And so a new generation learns to appreciate the passion behind Labour pin-up Nye Bevan's famed declaration in 1948 that the Tories are “lower than vermin”.
They jeer and they whoop now, but this is surely overreach. “Today Labour Are Voting To Increase Benefits By More Than Workers' Wages” is the latest Tory hit poster, claiming that they are “Standing Up For Hardworking People.” The Tories' recently hired arch-spinner Lynton Crosby has been quick to inject his own brand of bile into the Tory operation. But this divide-and-rule propaganda makes no sense. Both those who work for their poverty and those who are without a job are having their pockets emptied by a cabal of ideologically-crazed millionaires. It is quite true that both private and public sector workers have faced years of flatlining or declining wages. But now millions of them will be hit with reduced tax credits, too. They must not get away with playing off people receiving benefits and workers facing shrinking pay packets: they are one and the same. First you are mugged by your boss, then you are mugged by the Tories.
The baying of the Tories is loud enough; the voices of those affected have been all but airbrushed out of existence by the political establishment and a supine or sometimes criminally complicit media. Save The Children recently revealed a world that most of the commentariat don't even know – or want to know - exists: of parents choosing between heating their homes and feeding their kids; or skipping their meals to make sure their sons and daughters are nourished. Such is the conspiracy to deprive the electorate of the truth about the Government's onslaught on the welfare state that many don't even know they are about to be hit. With the Resolution Foundation projecting a 15 per cent decline in income for low earning families by 2020, they'll know soon enough. Research by the TUC last week showed that the more people know about the realities of the welfare state – about fraud, who gets benefits and how much they are really worth – the less likely they are to support Tory attacks. Here is the potential undoing of this vicious campaign.
And what of the Lib Dems? Granted, it is a question that answers itself. Four votes against and two abstentions excepted, every last yellow-bellied man and woman marched through the voting lobbies with their Tory masters to shrink the incomes of the poor. That includes Tim Farron, the posturing Lib Dem President who will undoubtedly one day attempt to claim the leadership of whatever remains of this disreputable, discredited party: he may well be able to drive his diminished parliamentary party around in a London cab after 2015, just like the good old days of British Liberalism. “Many of us have been fighting the corner of vulnerable people for months and months now,” he tweeted me before voting to slash their income, “And I'll keep doing that every single day.” I'd suggest he was Machiavellian, if I was not in danger of inventing strategic ability where there is none. More than any other Coalition policy, this scandalous, grubby episode has exposed a rootless party, devoid of principle, stuffed with vacuous non-entities and mealy-mouthed voting fodder for the worst attacks inflicted on the poor since World War II. No forgiving, no forgetting; the dustbin of history awaits them, and deservedly so.
This is not to let the Labour leadership off the hook. They were right to take on this cap – though, quite frankly, what is Labour for if it is not to defend the working poor and unemployed from Tory muggers? Yet it was a decision taken in the face of internal opposition behind the scenes from the party's Surrender Tendency. Former Home Secretary Jacqui Smith came out and openly savaged Ed Miliband for it. A period of silence would be most welcome, Jacqui.
But Labour's response will always be hobbled when it is delivered by the likes of Liam Byrne. The right have cheerfully dug out his own contributions to the vile attempts to turn the working poor against the unemployed: “Labour is the party of hard workers, not free-riders. The clue is in the name. The party that said idleness is an evil. The party of workers, not shirkers.” Or indeed: “Let's face the tough truth – that many people on the doorstep felt that too often we were for shirkers no workers.” The grotesque sight of a Labour politician – a Labour politician – parroting the divide-and-rule bile of Tory demagogues. Not only is it shameful, it is self-defeating: there is nothing the Tories desire more than for this “debate” to be framed on their terms. They watch in satisfaction as senior Labour figures fuel the fire about “scroungers”, knowing full well that the more it burns, the broader the pool of their own potential support. The Tories have a confident, clear, consistent message; exactly what is missing from their opponents.
Thieving from the poor while turning them against each other: any response but fury at what this government is doing is inexcusable. But it is not enough. This government – a government with a flimsy, pathetic excuse of a mandate – is intolerable, and it must be stopped in its tracks. No more silent simmering with rage. Demand the Labour leadership offer an opposition worthy of the name. Expose Tory lies at any and every opportunity. Give a platform to those battered by Tory savagery. Take to the streets. Strike, and support those who do. Learn from this country's proud history of peaceful civil disobedience. Sounds too radical, too extreme, or too much like hard work? In the years to come, you will be asked what you did to stop this horror show. And if you need another incentive, picture again those baying Tories, jeering as they mugged the poor. 

 

HAWAII - Out of Gas

Learn Outlook for 2013 TODAY! Yes, TODAY is the 37th annual SBH Business & Investment Conference, at the Ala Moana Hotel. Still time to attend the full day event (9 am – 2 pm) There will be networking, business exhibit tables, full luncheon and a tremendous program with outstanding speakers including: the Hawaii Tourism Authority’s Mike McCartney; the FBI’s Tom Simon, best selling author Bob Sigall and successful business owners, Kitty Lagareta and Roy Yamaguchi. "Politics in the Post-Inouye Era"' is the topic of the keynote speech by former Governor Ben Cayetano that he will deliver at the noon luncheon. Come to the Ala Moana Hotel (Garden Lanai) to attend today!

Today’s SBH Business Conference Sponsors Include: GOLD: McDonald's Restaurants of Hawaii; SILVER: The Systemcenter, Inc. BRONZE: Clear Channel, Phoenix Pacific, Valenti Print Group, Winners' Camp Foundation EMERALD: Scotty Anderson, Aloha Petroleum, Charley's Taxi, Grassroot Institute of Hawaii, HawaiiReporter.com, HECO, HMAA, HonoluluTraffic.com, JS Services, Kai Vodka, Outback Steakhouse - Hawaii Kai, Up & Running Hawaii. Refreshment Break Sponsor: Geal Talbert, UBS Financial Services

Out of Gas. Hawaii’s largest refinery, Tesoro, located in Campbell Industrial Park in Kapolei, has notified the State Department of Business, Economic Development & Tourism (DBED&T) that it has been unable to find a buyer for its refinery and 32 retail outlets after a year of searching and will close down its operations in April, 2013. Tesoro Corporation currently refines approximately 94,000 barrels of fuel daily and employs 250. The remaining refinery belongs to Chevron who has also made noises in past years of shutting down. And why not? Hawaii’s business climate remains hostile and local politicians demonize petroleum. Chevron currently refines about 40,000 barrels per day. Hawaii consumes about 1.25 million gallons of gasoline per day.

Where Was The Irish? Monday’s BCS Football Championship was very sad for most Hawaii residents who became Irish and part Samoan for a day. Work and traffic ground to a halt at 3 pm as nearly every TV was tuned to the Alabama/Notre Dame game. Though underdogs, the Fightin’ Irish had spirit, fans and Punahou’s Manti Te’o. Unfortunately, ND didn’t have game as the Crimson Tide rolled again and again to a 42-14 victory. It was an inglorious end to a great ND season. But it was good for food outlets, #5 tee shirts and beer distributors.

HAL Sets Records. Hawaiian Airlines, Inc., a subsidiary of Hawaiian Holdings, Inc. (NASDAQ: HA), announced its system wide traffic statistics for December, fourth quarter, and full year 2012. Hawaiian carried 9,484,204 passengers in 2012, the most in the company’s history. Passenger statistics for December and the fourth quarter were also company records.

Senator Agaran. Gov. Neil Abercrombie appointed Rep. Gilbert Samuel Coloma Keith-Agaran to the State Senate Monday to replace Lt. Gov. Shan Tsutsui. Tsutsui, from Maui, was previously the Senate President, a post now held by Donna Mercado Kim. This after the Gov’s recent appointment of Brian Schatz to the U.S. Senate. But wait! There’s more! The Gov now gets to appoint a Maui replacement for Agaran in the State House. Abercrombie has appointed more than his share of House and Senate members during his first two years. They are loyalists during the legislative session and will be valuable to him if he is challenged next year for a run for a second term as Governor.

Session Opens Wednesday. Next Wednesday, January 16, the 27th State Legislature will convene for its annual 60 working day run (until May 2). There still is no elected Speaker of the House or legislative calendar. The legislature opens at 10 am. Tickets are scarce. The Senate entertainment includes Brother Noland and Manoa DNA. Food will follow in legislative offices. Moronic legislation will follow the food. Watch for marijuana, gambling and assisted suicide to divert your attention from Hawaii’s serious economic problems.

Gun Appreciation Day. Mark your calendar for January 19 which will celebrate, “Gun Appreciation Day.” There have been a lot of attacks on lawful gun owners since the Sandy Hook killings but thoughtful people will continue to respect the Second Amendment.

Toyota Dream Car Contest. Toyota Hawaii is inviting all Hawaii student artists age 15 years and younger to create a drawing of “Your Dream Car” for TOYOTA’s 7th Dream Car Art Contest. Hand-drawn entries must be submitted by February 25, 2013 to any Toyota dealer in the state or mailed to Toyota Dream Car Art Contest, P.O. Box 2788, Honolulu, Hawaii 96803-2788. Entry forms can be found online at ToyotaHawaii.com, as well as at all Toyota Hawaii Dealerships starting today.

All eligible artwork will be automatically entered into the People’s Choice Competition. Family, friends, and fans of the Toyota Hawaii Facebook page will have the opportunity to vote for their favorite entries beginning January 15. The artwork with the most votes in each category at the end of the competition will be automatically entered for final judging in the local competition.

The judging panel includes Department of Education Art in Public Places Artist in Residence Resource Teacher Evan Tottori, Honolulu Academy of Arts Academy Art Center at Linekona Director Vince Hazen, KHON2’s Olena Heu, KITV’s Mahealani Richardson, Hawaii News Now’s Steve Uyehara, Pow Wow Hawaii Lead Director Kamea Hadar, and Toyota Hawaii’s Glenn Inouye.

Keiki Fun Run. On Saturday, February 16, thousands of cheering youngsters and their parents will take part in the Hawaii 5210 Keiki Run presented by Kaiser Permanente. The 1.5 mile untimed race, starts and ends at the Great Aloha Run Health Sports and Fitness Expo at the Neil Blaisdell Center Exhibition Hall.

Nearly 1,600 elementary and preschool aged students and their parents from 89 schools paricipated in the run in 2012. Hundreds of teen from McKinley High School’s athletic program, Kalani High School Riflery Team, Kapolei Middle School dance troop and Kamehameha Schools volunteered their services as well.

The event rose over $29,000 with 100% of the race entry proceeds going back to the schools to support their PE, physical activity and nutrition education programs. The top five schools with the highest number of participants were Sacred Hearts Academy, followed by Hanalani Schools, Ma’e Ma’e Elementary School, Windward Nazarene Academy, and St. Philomena Early Learning Center. Community partners that the keiki run are Kaho’omiki, Hawaii 5210, Let’s Go!, HAPHERD—Hawaii Association for Health, PE, Recreation & Dance, Hawaii Action For Healthy Kids, Hawaii Education Matters, and PSE—Pacific Sport Events & Timing.

Following the race were a number of activities that keiki could take part in, including a Personal Fitness Challenge, pictures with Marathon Foto, Taekwon-Do demonstrations with Traditional Taekwon-Do Center Honolulu, Kids Zumba with Gayla Traylor of Kamehameha Schools, and a Jump Rope Demo Team sponsored by Kamehameha Schools. More information about the Hawaii 5210 “Let’s Go!” program can be found at http://www.hawaii5210.com or http://www.kahoomiki.org or email tonimuranaka@gmail.com with questions.

SMEI Program. The Honolulu Chapter of Sales & Marketing Executives International presents John Deschner, Group Account Director with Deutsch LA Advertising, at a dinner on Tuesday, January 22nd, in the Moana Surfrider, a Westin Resort & Spa. Online and mobile commerce are doing more than competing with brick-and-mortar shopping – they’re cannibalizing it. From big-box retailers trying to combat “showrooming,” to auto dealers being pitted against each other by mobile-savvy consumers, offline businesses must rapidly embrace multi-channel commerce. John’s role focuses on Deutsch’s rapidly growing TARGET business, and contributes to many of the agency’s other digital, mobile, and social efforts.

The event begins at 5:30p.m., Tuesday, January 22nd. For reservations and more information, visit http://www.smeihonolulu.com by Wednesday, January 16th. Online ticket prices are available for early bird registration for SMEI members at $60, and $65 for non-members and guests. Call (808) 942-7000 or e-mail naomi@smeihonolulu.com with questions.

Al Gore Sells Out. Former Vice President Al Gore, champion of the global warming scam, carbon tax exchanges and enemy of (American) oil—as well as a record user of fuel, electricity and unfriendly planet materials in his own personal life—recently sold his TV network, Current TV, to Al Jazeera. Apparently a few American conservative groups wanted to bid for Current, but Gore refused, indicating he is closer to the philosophy of the Middle Eastern Al Jazeera, who gets its funding from Arab oil. It's owned by the emir of Qatar. The network, which paid a reported $500 million for the little watched Gore network, generated a $100 million profit for Gore.

Obamas Leave, Sunshine Returns. After more than a week of rain, high winds and grey skies, the Obamas left their ritzy compound in Kailua Saturday night and the skies cleared, birds sang and sunshine returned. Coincidence?

Flamingo on the Fly. The iconic Flamingo Restaurant on Kapiolani, long closed, is boarded up and set for demolition. Many happy meals there in the past.

Big Mike: New Man. Where is Big Mike Palcic you ask? The former owner of Mac Mouse Club, head of the Oahu Reapportionment Advisory Council, more than amateur cook and civic leader first class, has had a successful liver transplant in San Diego and the svelte Mike should be rejoining friends and family in Honolulu soon.

SBH Board Meets. The Smart Business Hawaii (SBH) Board meets Monday, January 14, noon, at the SBH office in Hawaii Kai. A review of the 37th annual SBH conference and election of new board members tops the agenda.

Want More Business? JOIN SBH! Is YOUR business a member of SBH? No? Lots of benefits. Strong neworking organization. Call Darlyn today (808-396-1724) or go online to http://www.smartbusinesshawaii.com.

Advertise Here. Some readers have inquired about placing an ad on the right margin of these weekly blasts which reach more than 15,000 people. Interested? If you want your business ad posted, the cost is $50 for one placement or $150 per month (4-5 placements). Contact Darlyn at SBH (396-1724) for specifics.

Want more local business information? Please visit the several SBH websites at:: http://www.smartbusinesshawaii.com, http://www.educate808.com and http://www.sbhfoundation.org.

Celebrating a business milestone? Your business press releases are welcome in the weekly SBH News & Views E-News which reaches more than 15,000 business owners and government leaders in Hawaii.

What? Not receiving your copy? Send PR, additional requests and email address to SBH@lava.net or call Darlyn at 396-1724.

SBH can help you with YOUR business. Just starting a business? Call me personally for help at 396-1724 or email: SBH@lava.net. Smart Business Hawaii Means Business and we're here to help you.

Aloha,

Virginia gov. proposes nixing gas tax, raising sales tax, hitting hybrids with $100 fee

By NBC's Domenico Montanaro

Gov. Bob McDonnell (R-VA), someone many think has an eye on 2016, made an announcement today that could have an impact on his future ambitions.
Virginia has a transportation problem in Northern Virginia. Congestion and tangled roads are the norm. McDonnell wants to try and fix it, but it all requires money. Lots of money.
Today, he proposed eliminating the gas tax, but raising the sales tax and increasing fees on things like hybrid cars and alternative-fuel vehicles.
The Virginian-Pilot:

Central to the governor's plan, whose component parts would raise an estimated $3.1 billion for transportation over 5 years, is elimination of Virginia's 17.5-cent per gallon gasoline tax for most passenger vehicles -- the levy would remain in place for diesel fuel. Virginia would be the first state to go that route if it dumps the fuel tax, according to state officials. ...
McDonnell would replace the state surcharge on gas by increasing the state's current 5-cent sales and use tax to 5.8 cents and dedicating all additional revenue generated from that to transportation. Even at that level, state officials say Virginia's sales tax would remain lower than rates in surrounding states.
The administration's argument for the swap is that the buying power of the gas tax, a key road revenue source, continues to dwindle as construction costs rise and vehicle fuel efficiency standards improve. ...
Aside from the tax swap proposal, other elements of McDonnell's plan include:
- A $15 increase in annual registration fees on motor vehicles.
- An annual $100 fee on alternative fuel vehicles, including hybrids.
- Another attempt to dedicate a greater slice of existing sales tax revenue -- from the current .5 percent to .75 percent over five years -- to roads.
- Receiving more sales tax revenue from online retailers, a plan contingent Congress' passage of a law giving states the authority to compel such merchants to collect taxes on sales made through their sites and remit them to Virginia.

Police in post offices as Scotland Yard axes 65 stations across London

Officers to set up shop in post offices and supermarkets as Met seeks to boost public confidence and meet £500m budget cuts

The Scotland Yard building in central London would be one of 200 sold off as part of the cuts. Photograph: Facundo Arrizabalaga/EPA

Scotland Yard is to close 65 police stations to the public across London and move its front desks into post offices and supermarkets as part of proposals to make £500m budget cuts.
In a blueprint for the future that will see the role of the detective at the Yard – once considered to have the finest investigators in the world – apparently downgraded, 1,200 more constables will be put into boroughs, and neighbourhood teams will be boosted by 2,600 officers.
Closing police stations mapped. Click image to explore it Eight hundred of the 1,200 extra constables will be detectives who are to be taken out of specialist squads, such as the burglary squad, and put back into uniform and on to the streets. The aim is to hand investigative powers to neighbourhood constables for low-level crime. They will be led by a "sheriff" in each London borough, and will be supported by teams of special constables, PCSOs and some detectives within each of the 32 boroughs of the force.
Assistant Commissioner Simon Byrne described detectives as "constables in T-shirts and jeans" and said he wanted to end the division between uniformed officers and detectives.
While carrying out what the commissioner has in the past admitted are huge cuts to the budget, the mayor's office wants public confidence in the police to rise from 62% to about 75%, and to reduce crime in seven key areas by 20%.
The mayor's office for policing and crime confirmed that the Scotland Yard building in central London would be one of 200 sold off as part of the cuts.
Within six months a pilot of putting police officers into post offices will be unveiled.
Byrne said: "This is about fundamental change. I think we can demonstrate that we care about local priorities. The way that neighbourhood policing in London is run compared with other examples of good practice is that we can do more.
"Too often the enforcement is carried out by the constables on the neighbourhood teams but the investigation of the crime is fed to individual specialist squads. We want to streamline that. We want to put more officers out to have face-to-face visible contact with the public, criminals and victims of crime, to extend the hours of neighbourhood teams and to bring them out of the margins of policing in London."
On each borough a neighbourhood inspector would become a "sheriff", he said, adding: "I will hold them to account for reductions in crime and rises in the number of people who are brought to book."
Byrne denied his plans would reduce the skill set of officers investigating crimes or amounted to an attack on the role of detectives.
But Deputy Commissioner Craig Mackey admitted that constables on neighbourhood teams would have to undergo training to learn the skills of detectives. "We want all our new recruits to know that they will all be investigators," he said.
Stephen Greenhalgh, the deputy mayor for policing, said priority crimes such as rape, gang violence and organised crime would still be tackled by central squads.
The decision to cut the number of police stations open to the public comes after research showed the public were not visiting front desks to report crimes. Figures show that 80% of visits to front counters in police stations are to 71 out of 135 counters and that fewer than 50 crimes a night are reported in person at police stations.
The mayor's office is expected to announce later on Wednesday which 65 police stations are to close. The plans are to go out to public consultation for eight weeks.
Greenhalgh said the public would be able to meet police officers in other places such as supermarkets or libraries. The use of post offices as a base for officers was being pursued, he said.
"The Post Office has benefited from a lot of capital money from government to keep branches open. We are in the process of developing a pilot scheme to see if it would work with the post office counter providing a fixed point on the high street where people could hand in lost property, could carry out transactions like purchasing licences and for very simple crime reporting."
The plans also include cutting the number of senior officers from 37 to 26, and reducing the supervision of officers as a result.
Scotland Yard is already in the process of cutting 1,500 staff posts from within the force.

Apple Inc. (AAPL) Stock Manipulation Report

Apple Inc. (NASDAQ:AAPL) one the most manipulated stocks of 2012 continues the trend into 2013.
Most technicians would agree that when viewing a chart of Apple Inc. stock there appears to be some “irregularities,” during some periods of time. Questionable trading activity can be seen both on the downside and the upside. On September 19th, the stock closed at $702.10, and a little over 3-months later on December 28th the equity fell to $509.58. A drop of 27.4% occurred with little news from the company and without any shocking developments about earnings, guidance or new product line development.
About two months ago, Apple jumped over 7% in one trading session. After closing at $527.68 on November 16th, the stock closed the very next day at $565.73, – a dramatic increase of $38.00. Another example is from the period of July 25 to September 21, when shares of Apple soared 24% or $135 in just 42 trading sessions. That type of performance effectively means that the stock averaged an increase of just over $3.20 per trading session for forty two consecutive days.

Some have argued that Apple’s stock performance leading up to the 2007 with the unveiling of the iPhone, made it a prime company for foment and manipulation. It is well-known that many media channels regurgitate the same misinformation in the market, which can easily cause a temporary panic-induced drop. Despite the news being completely untrue, someone can use these movements in the stock to profit handsomely.
Apple Inc. (NASDAQ:AAPL) is much easier to move compared to other companies with very little volatility such as Microsoft. Despite being in the same sector, Microsoft experienced a small difference in stock price since the 2000 bubble popped. More household names such as Procter & Gamble and Verizon are other examples of much more stable price movements.
These aforementioned companies simply do not have the type of ground breaking innovation that Apple is known for. They provide more stable products, and moving one of these stocks would be extremely difficult. In Apple’s case, an analyst or investor can simply say that they are hearing a rumor about “something” that “may” be happening in the near future. It could be based on complete speculation, but nevertheless will spur an initial move in the stock.
Investors who disregard the technical analysis and simply focus on the fundamentals may want to reevaluate their investment strategy. Technical analysis is a very important part of investing and the Apple (AAPL) chart supplies an abundance of useful information. When looking at the chart there were some movements that stuck out such as stacked buying for certain increments of time. When taking a closer look at intra-day moves and weekly options there seemed to be a constant occurring towards the end of trading, particularly some weird activity on Fridays.
On Fridays when weekly options are set to expire, many traders lose any potential gains as the equity value tends to move to get closer to the strike price for the week’s options. Lucky traders will be able to cash these securities in the money if given the chance and timed correctly, while others lose a substantial amount of principal. On these days there has been some erratic trading.
For example, on April 29th 2011, there was an extreme jump in trading in AAPL as more than 15 million shares changed hands and the stock dropped below the $350 strike price just before the closing bell (see chart below). The value of those calls disappeared almost instantaneously, while other puts were drastically put in the money. There are some that contend that fairly common hedging activity is the primary cause for the drifts in stock price. Other scientific reports have revealed that such stock price activity would not be accounted for by just hedging, and is thereby indicative of equity price manipulation, which by definition is illegal under United States securities law.

Apple Inc. (NASDAQ:AAPL)’s stock is vulnerable and can be easily moved due to its media exposure, popularity amongst all age demographics and the price of the stock. Most folks do not realize that the price of the stock is actually assisting in it being manipulated. Generally, a more expensive stock is more difficult to move due to how much capital it takes to do so. But with Apple, it’s different. About half of all trading in the stock generally takes place in very risky options that are set to expire at the end of the week. Apple stock option daily volume in weekly options was just over 90,000 contracts during the first three quarters of 2012.
Most investors want a piece of AAPL stock considering the current product line and the innovation that comes along with the name. Most retail investors cannot afford a $500 stock, or cannot buy enough shares to fill their appetite, so they turn to the options market. Most institutional investors are aware of this and are able to generate momentum in the stock, making it go significantly higher or lower. This allows the price to move quickly and trigger a lot of stops and scare day traders out of their position. Since options are so heavily traded with stop and limit orders, a select few are able to sway the stock and trigger these trades, causing abnormalities and spikes in the stock. It becomes what is known as a domino effect, and with Apple it is very easy to do.
The media has also tainted the credibility of the some of the equity movements in the stock. CNBC’s Jim Cramer was reported to have released an incorrect story following the iPhone’s launch that the company’s wireless partner Cingular, which was renamed AT&T at a later date) would supply a year and 6-months of free mobile service for the iPhone. The story was deemed completely false but was already picked up by blogs and widely publicized on various financial and syndicate sites like Digg. People began to question the report wondering why Cingular would give away $1440 of free service to at least ten million subscribers just to earn just $480 over two years. CNBC in general has been a basher of Apple Inc. (NASDAQ:AAPL), consistently pointing out how this may be the quarter when the company falters.
The Street’s Scott Moritz is also guilty of filing a very dubious report aimed at nailing Apple’s stock. The reported harped on the idea that Apple’s great launch weekend was a bust since the company was expecting to ship 1 million products within a few days, citing unanimous “whisper” sources. This story was deemed incorrect as the company does not release whisper numbers. The disbelief of the constant success and outperformance of the company has much of the media skeptical, especially folks at CNBC, who are always looking to poke holes in one of the most amazing corporate stories of a generation.
It appears that Apple Inc. (NASDAQ:AAPL) stock will continue to be manipulated until there are firm consequences put in place to stop people from driving the security up or down. Apple is a unique company and its stock carries a lot of euphoria that can be controlled with timely buying and momentum swings. These tactics in the end almost always benefit the large institutions and hurt the small retail investor.
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Disclosure: None

CURRENT TV Staffers Lash Out At Green Energy Hypocrite Al Gore

Douchebag hypocrisy is best served hot.
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Current TV Staffers Speak Out On Clean Energy Hero Al Gore
NY Post
Just call him Al Gorezeera.
Yesterday morning, the still shell shocked staff at Current TV was called to an all hands staff meeting at its San Francisco headquarters, which was teleconferenced to their offices in LA and NYC, to meet their new bosses. Ominously missing was the creator of Current, the self proclaimed inventor of the Internet and savior of clean energy, Al Gore, although his partner, Joel Hyatt, stood proudly with the Al Jazeera honchos.
“Of course Al didn’t show up,” said one high placed Current staffer. "He has no credibility."
“He’s supposed to be the face of clean energy and just sold the channel to very big oil, the emir of Qatar! Current never even took big oil advertising—and Al Gore, that bullshitter sells to the emir?”
One person at the meeting, who has already announced that she’s leaving, former Michigan Gov. Jennifer Granholm, tried to ask about severance packages for those who wouldn’t be staying.
“This isn’t the place to discuss this!” Hyatt barked at her.
“After that, everyone kept their questions pretty much to themselves,” according to the staff member.
The displeasure with Gore among the staff was thick enough to cut with a scimitar.
“We all know now that Al Gore is nothing but a bullshitter,” said the staffer bluntly. "We do stories on the tax code, and he sells the network before the tax code kicked in?"
“Al was always lecturing us about green. He kept his word about green all right—as in cold, hard cash!”
Continue reading...
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Infographi​c: PhDs on Food Stamps / Janitors with Doctorates

Source: OnlineColleges.net

The Dependence on Food Stamps is a Ticking Time Bomb

Sean Kerrigan, Contributor
Activist Post

Discussing the nation’s dependence on Food Stamps is likely to put many people into a defensive mode. Some feel resentful of those accepting government food subsidy. People on Food Stamps are sensitive to criticism in the media because often it comes with the implication that they are lazy or exploiting the system. Of course, fraud is a concern, but despite the national narrative, we would argue that these people are victims more often than not.

As readers of this blog are aware, we feel that the nation’s economy is at serious risk. Words like “meltdown” and “collapse” often come to mind. In the event of a financial crisis, Food Stamp recipients all over the country could be endangered. Unless the government responds quickly, violence could easily erupt as people attempt to secure food. Lets walk through it, but first we need to explain how bad the problem has gotten.

Food Stamp Usage

In the last five years, usage of the Supplemental Nutrition Assistance Program (SNAP), commonly called Food Stamps, has exploded, nearly doubling from about 26 million in 2007 to about 47.7 million today. An average of one out of every 6.5 Americans is now dependent on the government for food assistance, an absolutely stunning statistic.

In 1971, five percent of the population or roughly one in 20 used the program. Since 2007 it has grown by almost as much as all previous years combined. And the situation is worsening. Recent government reports confirmed there have been roughly 1 million new enrollees in just the last two months! Think about it. A million people. This does not include possible increases related to Hurricane Sandy which won’t be released until later this month.

 Examine this chart courtesy of the financial blog Zero Hedge. As you can see, Food Stamp usage has been relatively stable for most of 2012, but suddenly increased in September and October of this year. This cannot be explained away with unusual seasonal disruptions, which we suspect is why it wasn’t mentioned by any mainstream media outlet in television or print.

Ironically, in most states, the Food Stamp program is run by JP Morgan, a firm you’ll remember is partially responsible for the collapse in real wages, high unemployment, and of course market bubbles.

While the program is helpful for those that need it, you can’t have the number of enrollees approaching 50 million people and still argue this is a simple welfare program. It’s evolved well beyond that now. So what purpose do Food Stamps really serve? The answer as usual is money and power, but not for the program’s recipients. 


1) Food Stamps provide a subsidy to corporate America.

In the case of food stamps, the government provides an income subsidy to the nation’s poorest and often most exploited workers. Walmart, the nation’s largest employer, pays its workers an average of $8.50 an hour, just above the federal minimum wage. This translates to about $17,680 a year. Critics have accused the company of encouraging employees to use state welfare services so their employees don’t demand a living wage. 

2) Food Stamps suppresses societal backlash.

In addition to relieving corporations from the stresses of having to respond to widespread poverty, it also frees the government from having to respond, both from poor communities and from conscientious middle class observers. Despite the ongoing societal collapse, the economy appears to remain functional for most people.

Bread lines have been replaced with discrete Electronic Benefit Transfer (EBT) cards, which function similar to a debit card. With Food Stamps, even without a job, most beneficiaries are able to avoid starvation. The most serious and visual effects of our devastated economy are hidden from view of the middle class. Those reliant on the system are sufficiently content to avoid protesting in the street en masse. 

3) Finally, Food Stamps make people slaves to the government.

When people are dependent on Food Stamps or any other government service, this gives the government power. So far, the government mostly uses this power to prevent fraud, but it isn’t difficult to imagine the government using the food supply to control people in other ways. It may sound conspiratorial, but the government may one day require RFID implants for all Food Stamp recipients or other welfare beneficiaries. Biometric identification methods are already optional in several states, and a USDA report makes it clear the government wants to expand the program to eliminate fraud.

This, in conjunction with other legal barriers, can hold low-income people to a higher standard of identification. If a person is caught committing welfare fraud, they will never receive help from the government again; compare this to the ongoing amnesty of the criminal banks if you want a sense of the government’s priorities.

Solutions to these problems would require radical economy-wide changes, including dismantling the current power structure. This is obviously unacceptable to the power elite and so the fraud will continue until it cannot anymore; until the pressure becomes so great that it explodes, causing far more destruction that would ever have occurred if we addressed our problems sooner. 


What would happen in the event of a financial collapse?

When you have 47.7 million people reliant Food Stamps in the world’s largest and most important economy - roughly 15 percent of its population - you have a serious problem, and yet our political leaders have proposed no solutions except to wait and hope the economy recovers. In the meantime, the debt is getting larger, global instability is increasing, as is the likelihood of financial disaster.

Consider what would happen in the event of a sudden financial crisis. A bank holiday would be almost certain. Credit cards and debit cards would be useless. EBT, again run by JP Morgan, would also cease to function. Left with what little cash Americans had on hand, some would be able to rough it for a while. However, America’s most vulnerable, those dependent on government assistance, would find themselves unable to afford food. Within a very short period of time, food riots would erupt around the country. If the crisis escalated, the level of violence could be greater than any living person has ever seen. In some areas, martial law would not only be justified, but desirable.

Our decades-long attempt to paper over our problems has resulted in mass instability. Unless you believe things are suddenly going to get better (How could you, after all we’ve seen?), it’s only a matter of time before this situation erupts.

Our society has become quite adept at avoiding risk. We paper over social problems by generally offsetting or delaying anything that would resemble an attempt to actually deal with our many problems. While “kicking the can down the road” has its advantages, it has a cost. Any attempt to stabilize a collapsing system has a pacifying effect in the short term, but eventually, problems which may have been small, eventually mount, threatening to cause a cascade.

 The increased use of Food Stamps, over-prescribed pharmaceuticals, the attempt to restrict guns and the Federal Reserve’s money printing are just some of the attempts to stem the symptoms of our national sickness without actually addressing the problems of low wages, societal decay, crass consumerism and widespread mental instability.

If the support Food Stamps provide is suddenly withdrawn, the level of disruption it would create would be stunning — let alone any other ill effects a financial crisis would cause. Citizens would be well advised to consider their surroundings going into the new year. How vulnerable is your community to disruption? More on this later.

Sean Kerrigan is a freelance journalist and occasional blogger concentrating on new media, finance, and politics. He has written for several daily and weekly newspapers including the Bucks County Courier Times.  He is also the author of Corporatocracy: An Introduction to the New American Government.

AIG, bailed out by America, may sue America - Simpson and Bowles try again - Goldman manages around trading rules - Feds, banks reach foreclosure deal

By BEN WHITE | 01/08/13 7:58 AM EDT

CAN’T MAKE IT UP: AIG, BAILED OUT BY AMERICA, MAY SUE AMERICA — In a story that seems almost too audacious to believe, insurance company AIG, which only just finished paying back its $182 billion taxpayer rescue, is reportedly considering joining a lawsuit against the U.S. government over the terms of that rescue, by far the most controversial and publicly derided of the Wall Street bailout era. The possible legal action comes as AIG is also running a splashy national ad campaign saying “Thank you, America,” for saving the company from total collapse. A federal judge in New York in November tossed out the lawsuit AIG is considering joining, noting that AIG had two options in 2008: Agree to terms of the bailout or go into bankruptcy. It chose the bailout. But the lawsuit continues on a separate track in federal court in Washington and in a federal appeals court.
Former AIG CEO Maurice “Hank” Greenberg initially filed the shareholder suit. There is a corporate governance argument to be made that the AIG board has a fiduciary duty to shareholders to consider joining the lawsuit, as the NYT notes in the story below. But there is an even larger PR argument to be made that doing so would be potentially more damaging to the company’s reputation and share price than failing to take part in any settlement of the Greenberg lawsuit. Greenberg is represented in the suit by prominent attorney David Boies, who famously handled Al Gore’s failed effort to continue a recount in Florida in the 2000 presidential election that eventually went to George W. Bush.
LAWSUIT DETAILS — According to the A1 story broken by NYT’s Ben Protess and Michael J. de la Merced, AIG’s board “will meet on Wednesday to consider joining a $25 billion shareholder lawsuit against the government, court records show. The lawsuit does not argue that government help was not needed. It contends that the onerous nature of the rescue — the taking of what became a 92 percent stake in the company, the deal's high interest rates and the funneling of billions to the insurer's Wall Street clients — deprived shareholders of tens of billions of dollars and violated the Fifth Amendment, which prohibits the taking of private property for ‘public use, without just compensation.’
“… [S]uch a move would almost certainly be widely seen as an audacious display of ingratitude. The action would also threaten to inflame tensions in Washington, where the company has become a byword for excessive risk-taking on Wall Street. Some government officials are already upset with the company for even seriously entertaining the lawsuit, people briefed on the matter said. The people … noted that without the bailout, AIG shareholders would have fared far worse in bankruptcy … ‘The AIG board of directors takes its fiduciary duties and business judgment responsibilities seriously,’ said a spokesman, Jon Diat.” http://nyti.ms/10aIGvb
DIAT declined further comment.
SIMPSON AND BOWLES TRY AGAIN — Campaign to Fix the Debt’s Erskine Bowles is holding a presser this afternoon alongside several business executives at the Nasdaq in NYC to renew his group’s call for a grand bargain in Washington to reduce the $16 trillion national debt. Thus far Bowles and his debt reduction partner Alan Simpson’s efforts, even with heavy assistance from prominent CEOs, have failed to push through such an agreement as part of any recent fiscal fights. The debt ceiling debacle of 2011 didn’t produce a mega deal, nor did the just completed fiscal cliff fight. Now Simpson and Bowles are trying again as Washington approaches the triple fiscal fiasco of the debt ceiling, sequester and possible government shutdown.
But will things be any different this time? Why do the event? Campaign to Fix the Debt’s Jon Romano emails MM: “CEO/private sector participation in the Campaign to Fix the Debt to restore the nation's fiscal health is increasing — because those who help drive the economy understand what is at stake. Nasdaq has invited us to educate and engage their members, which include some of the nation's most innovative and creative entrepreneurs.”
HOT READ: GOLDMAN MANAGES AROUND TRADING RULES — Bloomberg’s Max Abelson in a story that popped at midnight: “Sitting onstage in Washington’s Ronald Reagan Building in July, Lloyd C. Blankfein said Goldman Sachs Group … had stopped using its own money to make bets on the bank’s behalf. … That may come as a surprise to people working in a secretive Goldman Sachs group called Multi-Strategy Investing, or MSI. It wagers about $1 billion of the New York-based firm’s own funds on the stocks and bonds of companies … according to interviews with more than 20 people who worked for and with the group, some as recently as last year. The unit … has no clients, the people said.
“The team’s survival shows how Goldman Sachs has worked around regulations curbing proprietary bets at banks. … The law doesn’t bar longer-term wagers. … Michael DuVally, a Goldman Sachs spokesman, said in an email that MSI engages in long-term investing and lending. A 2011 proposal for implementing the Volcker rule uses a 60-day cutoff to classify short-term trades. ‘We have made changes to the strategies this business historically has employed to bring them into compliance with our current understanding of the Volcker rule,’ said DuVally. … ‘If the final rule requires additional changes, we’ll make them.’” http://bloom.bg/WGE2xi
THIS MORNING ON POLITICO PRO FINANCE — Kate Davidson and Jon Prior on the “robo-signing” settlement … MJ Lee on how Rep. Greg Walden is not amused by the $1 trillion coin idea … Jon Prior on how BofA’s sale of its servicing rights could help get borrowers into HARP more quickly … To learn more about Pro's subscriber-only coverage — and to get Morning Money every day before 6 a.m. — please contact Pro Services at (703) 341-4600 or info@politicopro.com.
GOOD TUESDAY MORNING — RIP Richard Ben Cramer, author of “What It Takes,” the sprawling and definitive book on the nature of the modern presidential campaign. http://bit.ly/13cTIid
Send your tips and comments: bwhite@politico.com; and follow on Twitter: @morningmoneyben and @POLITICOPro.
DRIVING THE DAY — Should be an interesting day of reaction in D.C. to word that AIG may sue the federal government … NFIB small business survey out at 7:30 a.m. EST, expected to dip slightly to 87.2 from 87.5 after November’s huge drop … Consumer credit at 3 p.m. EST expected to rise $10.5 billion … Bowles-Simpson event at Nasdaq begins at 1:30 p.m.
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IN DEFENSE OF BASEL — NYT’s Andrew Ross Sorkin on the Basel committee move: “While there is no question that the original rules would do a better job preventing the next 100-year flood in the banking system, their quick adoption most likely would have created their own drag on the economy because bank lending would most likely have been curtailed. … In truth, the reason that regulators ultimately chose to relax the rules was simple practicality: many banks in Europe and some in the United States would have never been able to meet the requirements without significantly reducing the amount of credit they were to extend to Main Street over the next two years. … That's the other side of the regulatory coin that Main Street often forgets about. At the time that the original rules were written in 2010, the consensus among economists was that the global economy would be in much better shape today.” http://nyti.ms/VHuKo3
COMING THURSDAY: QRM RULE? — Per Compass Point Trading’s Isaac Boltansky: “[T]he most meaningful event of the week is the CFPB’s expected release of its Qualified Mortgage (QM) rule. The CFPB will hold a field hearing in Baltimore on Thursday and we have been told to expect the release of the QM rule to coincide with this hearing. … The QM rule is unequivocally the most important mortgage-related rule still not public. The QM rule will define the metrics for assessing a borrower’s ability to repay a loan, which in turn establishes the parameters of a mortgage lender’s legal liability stemming from underwriting.”
LEW PICK COMING SOON — M.M. and others have reported for some time that White House Chief of Staff Jack Lew was a near lock for Treasury Secretary. Bloomberg’s Hans Nichols now reports Lew could get the call “as soon as this week.” More Nichols: “Selecting Lew to replace Timothy F. Geithner would also require Obama to install a new chief of staff, the first step in a White House staff shuffle for his second term. Many of the president’s senior aides may be taking new roles as the president recasts his team. …While Obama hasn’t made a final decision to pick Lew, his staff has been instructed to prepare for his nomination … Among the leading candidates to replace Lew as Obama’s chief of staff are Denis McDonough, currently a deputy national security adviser, and Ron Klain, who had served as Vice President Joe Biden’s chief of staff.” http://bloom.bg/VOUhbA
ISSA, CUMMINGS WANT FORECLOSURE SETTLEMENT EXPLANATION — House Oversight and Government Reform Committee Chairman Darrell Issa and ranking member Elijah Cummings sent a letter to Fed and OCC requesting a briefing on the new settlement agreement. Letter: http://bit.ly/Wpn9Xh
CUMMINGS SLAMMED THE SETTLEMENT in a statement: “I am deeply disappointed that the OCC and the Federal Reserve finalized this settlement and effectively terminated the Independent Foreclosure Review process before providing Congress answers to serious questions about how this settlement amount was determined, who these funds will go to, and what will happen to other families who were abused by these mortgage servicing companies, but have not yet had their cases reviewed.”
SETTLEMENT DETAILS — WSJ’s Shayndi Raice, Nick Timiraos and Dan Fitzpatrick on Page A1: “Major banks agreed to pay $20 billion to settle mortgage-related legal disputes, in Wall Street's latest bid to put alleged abuses of the home-lending process in the rearview mirror. Bank of America will pay $3.6 billion to Fannie Mae as well as repurchase certain mortgage loans made from 2000 through 2008 for $6.75 billion. …
“The deals come as near-record-low interest rates are feeding a new upturn in the U.S. housing market. That recovery, and expectations that banks finally will surmount the legal challenges that have dogged them since the financial crisis in 2008, have sent bank shares surging to recent highs. … Reducing banks' legal uncertainty could ultimately clear the way for a wave of new loans.” http://on.wsj.com/USBej3
DEBT CEILING FLY-AROUND –
ALTMAN: GOOD JOB ON DEFICIT SO FAR! — Roger Altman writes in the FT: “The last-second deal to avoid America’s fiscal cliff has been criticised by budget experts, the business community and the press. … Critics are transfixed by the bitter negotiations, however, and are missing the big picture. It may be happening in stages, but the U.S. is making real progress towards reducing deficits and stabilising its debt. Indeed, according to the Committee for a Responsible Federal Budget … the federal debt to gross domestic product ratio … will be stable at about 73 percent for the next decade. That is because annual deficits are now on track to be halved and, therefore, the debt level will not continue to grow faster than the economy. Yes, this ratio is still too high, but stabilising it will be a crucial achievement.” http://on.ft.com/Vzt7qd
FIRESTONE: DON’T TRIVIALIZE THE DEBT CEILING — NYT’s David Firestone in an editorial blog post: “Back in the summer of 2011, the first time Republicans threatened not to raise the debt ceiling and forced a downgrade of the nation’s credit rating, many in the party minimized the possible consequences of their actions. … That was nonsense then, and it’s still nonsense as we enter into yet another debt-limit fight. Busting through the limit would indeed constitute default, since the government would be unable to pay its bills.
“Credit markets don’t care which bills are in arrears. By refusing to pay its basic obligations, Washington would undermine the trust that makes lenders willing to buy government bonds. It’s not even clear that the president has the constitutional authority to pick and choose which creditors to pay and which to stiff.” http://nyti.ms/TYLNA0
KRUGMAN: MINT THE COIN — Paul Krugman in a blog post: “Should President Obama be willing to print a $1 trillion platinum coin if Republicans try to force America into default? Yes, absolutely. He will, after all, be faced with a choice between two alternatives: one that’s silly but benign, the other that’s equally silly but both vile and disastrous. … Yes, it was intended to allow commemorative collector’s items — but that’s not what the letter of the law says. And by minting a $1 trillion coin, then depositing it at the Fed, the Treasury could acquire enough cash to sidestep the debt ceiling — while doing no economic harm at all. … So if the 14th Amendment solution — simply declaring that the debt ceiling is unconstitutional — isn’t workable, go with the coin.” http://nyti.ms/UF2lgp
SALMON: THERE WILL BE NO COIN — Reuters’s Felix Salmon: “Let’s be clear about this: no one’s going to mint a $1 trillion platinum coin. Nor is anybody going to mint a million $1 million platinum coins. But it would probably be stupid for anybody in the government to say that they’re not going to do it. … Everybody who’s ever been in charge of any country’s finances knows that the concept of a debt ceiling is profoundly stupid, self-defeating, and generally idiotic. … It’s important to recognize just how damaging the platinum coin move would be, all the same.
“It would effectively mark the demise of the three-branch system of government, by allowing the executive branch to simply steamroller the rights and privileges of the legislative branch. Yes, the legislature is behaving like a bunch of utter morons if they think that driving the U.S. government into default is a good idea. But it’s their right to behave like a bunch of utter morons. If the executive branch failed to respect that right, it would effectively be defying the exact same authority by which the president himself governs.” http://reut.rs/Wrk34Z
ALSO FOR YOUR RADAR –
NEW DODD-FRANK BOOK — Per release from the Mercatus Center at George Mason University: “[Today], the Mercatus Center at GMU is putting out a new book entitled: ‘Dodd-Frank: What it Does and Why it’s Flawed.’ Hester Peirce of Mercatus and her co-authors look at the law’s applauded objectives and argue that in fact, much of what will be implemented, could very well set the groundwork for the next crisis; poorly designed consumer protections will actually pass more costs on to consumers and give them fewer financial options. And perhaps worst of all, Dodd-Frank gives greater regulatory oversight to the same regulators that haven’t managed to adequately handle their current list of market monitoring responsibilities.”
PELL INSTITUTE LAUDS TRAVELERS PROGRAM — Per release: “Amid budget negotiations that could impact education funding across the country, The Pell Institute for the Study of Opportunity in Higher Education … released an in-depth report on The Travelers Companies Inc.’s signature education program, Travelers EDGE … praising it as a leading corporate college access and professional development program to help underrepresented students succeed. The program could serve as a national model for other companies to follow.” Report: http://bit.ly/WuIfn2
DISNEY EYES LAYOFFS — Reuters’s Ronald Grover: “Walt Disney Co. started an internal cost-cutting review several weeks ago that may include layoffs at its studio and other units, three people with knowledge of the effort told Reuters, in an early sign that big companies may not be finished tightening their belts. Disney … is exploring cutbacks in jobs it no longer needs because of improvements in technology, one of the people said. It is also looking at redundant operations that could be eliminated following a string of major acquisitions. …
“After years of repeated and sometimes severe cost cutting in the wake of the financial crisis, by last summer it looked as though Corporate America had trimmed all the fat and was back on the path of profits through operating growth. But news Disney is weighing cuts — on the heels of Eli Lilly and Co.'s warning last week that cost controls would drive earnings this year — could herald yet another wave of retrenchment.” http://reut.rs/RDaLX2
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