Tuesday, April 9, 2013

The Country Is Over

america us-sinking-shipEconomic Noise
Data are hard to deal with when your vision is on the wrong side of it. Those wanting to claim there is a recovery underway are having just this problem. These people either have no understanding of economics or they believe falsely that they can inflate “animal spirits” with their hyped reports and that will initiate a recovery.  
There will not be an economic recovery given the economic policies of this country. A recovery is not unlikely, I would argue it is closer to impossible if not impossible. The reasons for this position are not complicated. In short, the nation has become an out-of-control welfare state that is rapidly destroying the incentives to work or create jobs. Government policies appear designed toward this end. One doesn’t need a high IQ or  an advanced degree in economics to understand the problems.
There are innumerable factors responsible for the decline of the US. Only three important ones will convey why the economy is dying:
1. The rule of law and property rights are under attack. cyprusbankrobbery(2)
What do you really own? The depositors in Cyprus believed they owned what was in their bank accounts. They found out otherwise. Bondholders of General Motors believed they were protected by bankruptcy laws when GM was bankrupted by the government. They found out otherwise. Do you own your pension plans and IRAs. Well you always believed you did except now there is talk about confiscating a portion or all of these funds.
How much of your income do you own? For those doing well, let’s say 60%. But that portion is under attack with the “need” for higher taxes and “fair share” gobbledegook. What about Social Security? Although the government sold it as a retirement policy and told you it is yours, the government says in fine print it is not. That is their excuse for not treating it as a liability on their balance sheet.
The fact is that the rules are being changed at will by the side who has lots of guns. The number of rules and laws that have been changed or ignored in the past several years makes one wonder what laws will remain. We are  approaching the point where there are no rules which means there can be no society. Without cooperation, markets will cease to function efficiently or perhaps at all. Millions of people will starve to death under such conditions.
2. Obamacare has raised costs
The costs associated with Obamacare are still not known or calculable. The rules are still being written. Already there are thousands of pages. Even though we passed it as Speaker Pelosi suggested as a means to find out what was in it, we still don’t know as the rules are still being made up.
For sure the program is driving up the costs of medical care and driving down the quality. That is exactly the opposite of what was promised. Business firms face great uncertainty as to what this mandate will do to their costs and operating procedures. Obamacare is rising the cost of employees. When you penalize something, you get less of it. That is a prime reason why there is no employment recovery in this country.
Employers have frozen their hiring until clarity develops. The development of clarity is no assurance that they will change their behavior. If the costs are too high (and they appear to be for many smaller businesses who create the most jobs), then hiring will not return.
The effect on hiring is only one negative. Full-time workers are being made part-time in order that they be exempted from the Obamacare mandate. These steps are not something business wants to do, it is something they must do in order to survive.
3. Government policies have made the dole more lucrative than work
As we make it easier to get unemployment benefits for longer time periods, more people take advantage of the system. So too with food stamps and disability. All programs are at or near record levels in what is supposed to be four years into an economic recovery. For many, the benefits of becoming a government dependent exceed what they can earn. One study reported that a family of four, collecting all the benefits for which they were entitled, would have to earn $65,000 per annum to have the same after-tax purchasing power.
If you are a product of the government schools and are legal to work (i.e., have skills enough that you are affordable at the minimum wage or higher), at what point do you realize that there is no need to go through the hassle of actual work. You can live pretty well by staying home and taking advantage of the entitlements available to you. That is exactly what a larger and larger percentage of the population are realizing. In many cases, it is economically irrational to work.
This behavior creates a social pathology that only worsens over time. Kids learn from their parents that work is not necessary and the many ways to game the system. In this regard, look for this problem to become worse over time unless these programs are cut back.
There Can Be No Recovery
Despite all you hear coming from the government’s media megaphone, there is no economic recovery underway, nor can there be one. The policies in place ensure that one will not happen. Economics is not a top-down science as Keynesians and politicians want you to believe. You can throw as many Fed dollars into the system or devise innumerable government stimulus programs. These are all top-down. Economics is a bottom-up process that starts with individual decisions and behavior. Individuals respond to available choices and incentives. They act in their own self-interest not in the manner in which some government planner wants them to act. Top-down programs do not affect the incentives of the individual decision-makers.
We raise the costs on those who work (higher taxes) and the businessmen who provide the jobs. One of the basic laws of human nature is that when you penalize something or make it less pleasant, people will want less of it. It is not a mystery why business is not hiring and the number of workers is declining. The return to both is declining as a result of government policies.
We raise the rewards for not working. Another basic law of human behavior is that when you increase rewards for a particular kind of behavior, you will get more of it. It is not a mystery why more people are choosing the dole than ever before. Government has encouraged them to do by providing higher rewards.
Add in the regime uncertainty associated with unstable or unpredictable laws and regulations and you have the perfect storm. There is no incentive to hire. Business hunkers down not knowing what is coming their way next. They understand they are targets of this Administration. It is unlikely that there will be any improvement on this fron while Obama remains in office. This behavior has nothing to do with politics. Even businesses headed by Democrats are behaving in this fashion. It is self-interest as in the desire to survive that motivates this behavior.
Why The Economy is Dying
As government grows the private sector shrinks. As the private sector shrinks there are fewer goods and services produced (government produces no goods and few services). I believe it was Dick Armey who described this situation with the wagon analogy: there are more people riding in the wagon and fewer pulling the wagon. As the wagon becomes heavier, the remaining pullers must work harder to move it.
The pullers must support the riders. Government does not support the riders or anyone else for that matter. Whatever government has it has taken from the pullers. Whatever it doles out it must get from taxes, borrowing or printing new money. Regardless of which means it uses, it is all coming from the pullers. They pay the borrowing back. They have less as a result of higher taxes. They are made poorer by the rising prices from the printing of money.
As the burdens increase on the pullers and the benefits increase for the riders, more pullers decide to ride. The truly creative and talented can always make enough money to continue to work rather than ride. However, when their efforts can be expended in other countries that penalize them less, at some point they no longer pull the wagon. They leave the country to climes where they are treated better.
Each increase in government spending means requires more money from the private sector. That means greater distortions in the incentive-disincentive calculus that produces fewer people pulling the wagon. Now fewer people must support more non-producers. Every time someone gets in the wagon, the burden on the productive sector increases. More must be extracted from a smaller group to serve the increasing riders.
That is what is happening in this country. If it is not reversed, the economy will stagnate and eventually implode. This conclusion is dependent upon nothing more than simple arithmetic. How bad is the imbalance today? Tyler Durdenprovides some information (my emboldening in red added):
The punchline: 110 million privately employed workers; 88 million welfare recipients and government workers and rising rapidly.
And since nothing has changed in the past two years, and in fact the situation has gotten progressively (pardon the pun) worse, here is our conclusion on this topic from two years ago:
We have been writing for over a year, how the very top of America’s social order steals from the middle class each and every day. Now we finally know that the very bottom of the entitlement food chain also makes out like a bandit compared to that idiot American who actually works and pays their taxes. One can only also hope that in addition to seeing their disposable income be eaten away by a kleptocratic entitlement state, that the disappearing middle class is also selling off its weaponry. Because if it isn’t, and if it finally decides it has had enough, the outcome will not be surprising at all: it will be the same old that has occurred in virtually every revolution in the history of the world to date.
But for now, just stick head in sand, and pretend all is good. Self-deception is now the only thing left for the entire insolvent entitlement-addicted world.
Mr. Durden’s article is worthwhile and informative. I encourage you to read it in its entirety, including the PDF attached.
Is The Decline Inevitable?
Of course not. As Lawrence of Arabia stated: “Nothing is written.”
The Economic Solution
The solution to solving the problem is quite simple for an economist. Merely reverse the process. Make it attractive for people to jump out of the wagon and begin pulling. For businesses, make it attractive for them to hire. Make it unattractive to be on the dole. Reverse the growth of government and you increase the size of the private sector. More capital is made available for productive activities rather than being squandered by government. Talent stops leaving the country when they are treated more favorably here, whether this be via lower taxes or less onerous regulatory burdens. Then, get government out of the way and let markets solve the problem.
The Political Barrier
For the political class, the solution borders on the impossible. Politicians have bribed the citizenry with goodies for votes. They have sold the notion that government is responsible for all good things. The economic solution runs counter to everything that politicians have peddled. Further it reduces their power and ability to retain office, at least in a manner in which they are accustomed. It shrinks their perquisites. It shrinks their vote-buying ability. In short, it is virtually impossible for them to go along with such a solution.
What politicians thrive on is what created the current problems. Reversing this behavior is alien to them. They would not know how to behave under such conditions. Yet the economic solution is the only solution!
Do I expect politicians to change and save the country? No! Is it possible they could? Probably not, but “nothing is written.”

Governor Jerry Brown goes to China in seeking investment in California

Mercury News
SACRAMENTO (AP) — Gov. Jerry Brown has designs on building some of the most expensive public works projects in the nation and wants to keep the state moving forward in its slow recovery from the recession.
Where better to go searching for the money to further those interests than the world’s second largest economy and a country that has piles of cash to invest around the globe?  
Brown heads to China next week to begin a weeklong trade mission that he hopes will produce investments on both sides of the Pacific. Brown will lead a delegation of business leaders in search of what he calls “plenty of billions.”
“They’ve got $400 billion or $500 billion they’re going to invest abroad, so California’s got to get a piece of that,” Brown said in an interview last week ahead of his seven-day trip to China.
The governor and the business leaders accompanying him are trying to rebuild the state’s official relationship with China after the state closed its two trade offices and others around the world a decade ago in a cost-cutting move. California finds itself playing catch-up to other states that have had a vigorous presence in China for years.
California, which would be the world’s ninth largest economy if it were a separate country, will open a trade office in Shanghai during Brown’s visit. The Bay Area Council, a coalition of business interests from Silicon Valley and the rest of the Bay Area, is raising about $1 million a year in private money to operate it.
“California shouldn’t be the only state in the union not to have a presence with key foreign trading partners like China,” said Jim Wunderman, the group’s president and CEO.
The council opened its own office in Shanghai in 2010 to fill the void after the closure of the trade offices. Bruce Pickering, executive director of the Northern California branch of the Asia Society, called the 2003 decision “penny wise but pound foolish.”
“We’ve basically said, ‘We’re California, show up and stand in line with everybody else,’” Pickering said. “You have to do a little more than just say you’re welcoming a business. … You have to really send a message that you are ready for it.”
The Asia Society, a nonpartisan, nonprofit organization that promotes collaboration between the U.S. and Asia, reported in 2011 that businesses from China have established operations and created jobs in at least 35 of the 50 U.S. states, including California.
Pickering said California is behind other states in recruiting Chinese investment, while states as varied as Pennsylvania, Missouri, Florida and Arkansas have had an official presence there. The Republican governors of Iowa, Virginia, Wisconsin and Guam also are visiting China this month and meeting with provincial leaders to discuss trade and the environment.
“I would think it would be very difficult to try to attract investment without having someone on the ground there on your behalf,” said Joe Holmes, communications director for the Arkansas Economic Development Commission.
Arkansas Gov. Mike Beebe led a mission to China last year, and a number of deals are being discussed as a result, Holmes said.
The Asia Society reported this year that China’s direct foreign investment is poised to skyrocket to between $1 trillion and $2 trillion by 2020. California is ideally situated to capture some of that money if it goes after it: China already is California’s third-largest export partner after Mexico and Canada.
Brown already has a relationship with President Xi Jinping. The two met to discuss trade issues last year when the then-vice president visited California.
Technology, life sciences, real estate, banking, health care and agriculture are among the industries state business leaders and officials hope to target. The concentration of skilled technical engineers and the clean-energy sector in Silicon Valley also are draws for emerging companies, along with Chinese tourism to California.
State and local tourism officials are among those joining Brown on the trip, along with winemakers, cheese producers and almond growers. In all, about 75 business and policy leaders from a cross section of California industries are joining the mission, which will include stops in the capital city, Beijing, as well as Shanghai and Guangzhou.
Those cities are among the most developed and important in China. Shanghai, a port city, is an important center of industry and finance, while Guangzhou is in the heartland of the Pearl River Delta Economic Zone, which is home to the myriad processing and assembling factories that have made China the world’s factory floor.
The nearly $4 billion a year in computer and electronic products California sends to China account for the state’s largest export, followed by waste and scrap, non-electrical machinery and transportation equipment. Agricultural products such as strawberries, almonds and lettuce are fifth.
According to the governor’s office, the vast majority of Chinese exports headed to the United States go through California ports.
The trip also signals a pivot for Brown as he seeks to rebuild California’s nearly $2 trillion economy after the state’s tumultuous ride during the Great Recession. It was the epicenter of the housing crisis and weathered double-digit unemployment for nearly four years.
Brown said the state budget has stabilized, in large part because of voter-approved tax increases, and that he is now moving on to broader policy issues.
“California is a place where it’s a cauldron of creative activity, and I see that China has some of that, maybe a lot of that,” Brown said in the interview. “You have always got to find a way to renew things, and that’s what I see as my job here.”
The governor’s boldest and most expensive projects are a $68 billion high-speed rail system that is expected to start construction this summer and a $24 billion project to build massive water-delivery tunnels and restore parts of the Sacramento-San Joaquin River Delta, the largest estuary on the West Coast.
Brown is especially interested in studying China’s extensive high-speed rail system and using it as a way to promote his own plan, which has come under intense criticism and has been losing public support as its projected cost has soared. The governor is scheduled to ride part of China’s rail system from Beijing to Shanghai, accompanied by the chairman of California’s high-speed rail board, Dan Richard.
China has the world’s longest high-speed rail system, covering 5,800 miles, and has tried to turn it into a showcase. But the system also has faced problems: Part of a line collapsed in central China after heavy rains and a crash in 2011 killed 40 people. The former railway minister, who spearheaded the bullet train’s construction, and the ministry’s chief engineer, were detained in a corruption investigation.
Brown said he likes “the exuberance” with which Chinese officials approached building high-speed rail and would welcome investment in the California system or any other infrastructure projects in the state.
Despite the governor’s enthusiasm, it’s not clear how applicable the Chinese system is to a major infrastructure project in the U.S. The Chinese high-speed rail network benefits from heavy government financing and faces few of the environmental and legal hurdles found in California. The land needed to build the Chinese system is often forcibly procured at below market prices.
Associated Press writer Charles Hutzler in Beijing contributed to this report.

25 Things That You Should Do To Get Prepared For The Coming Economic Collapse

Michael Snyder
Activist Post

Do you think that you know how to prepare for the collapse of the economy?  If so, are you putting that knowledge into action?  In America today, people are more concerned about the possibility of an economic collapse than ever before.  It has been estimated that there are now three million preppers in the United States.  But the truth that nobody really knows the actual number, because a lot of preppers keep their "prepping" to themselves.  So what are all of those people preparing for exactly?

Well, survey after survey has shown that "economic collapse" is the number one potential disaster that preppers are most concerned about.  Of course that shouldn't be surprising because we truly are facing economic problems that are absolutely unprecedented.  We are living in the greatest debt bubble in the history of the world, the global banking system has been transformed into a high-risk pyramid scheme of debt, risk and leverage that could collapse at any time, and wealthy countries such as the United States have been living way above their means for decades.

Meanwhile, the United States is being deindustrialized at a blinding pace and poverty in this country is absolutely exploding.  Anyone that is not concerned about the economy should have their head examined.  Fortunately, I have found that an increasing number of Americans are becoming convinced that we are heading for a horrific economic crisis.  Once they come to that realization, they want to know what they should do.

And the reality is that "getting prepared" is going to look different for each family based on their own unique circumstances.  Some people have a lot of resources, while others have very little.  Some people are very independent of the system and can move wherever they want, while others are totally dependent on their jobs and must stay near the cities at least for now.

In addition, it is important to distinguish between the "short-term" and the "long-term" when talking about economic collapse.  As I have written about previously, our economic collapse is not going to happen all at once.  It is going to unfold over time.  In the "short-term", many are moving money around and are building up "emergency funds" to prepare for the next recession.  For the "long-term", many are storing up food and huge stockpiles of survival supplies in order to be prepared for the total collapse of society.  Both approaches are wise, but it is important to keep in mind that different approaches will be needed at different times.

The strategies posted below are a mix of both short-term and long-term strategies.  Some will be important for our immediate future, while others may not be needed for a number of years.  But in the end, you will be very thankful for the time and the effort that you spent getting prepared while you still could.

The following are 25 things that you should do to get prepared for the coming economic collapse...

#1 An Emergency Fund

Do you remember what happened when the financial system almost collapsed back in 2008?  Millions of Americans suddenly lost their jobs, and because many of them were living paycheck to paycheck, many of them also got behind on their mortgages and lost their homes.  You don't want to lose everything that you have worked for during this next major economic downturn.  It is imperative that you have an emergency fund.  It should be enough to cover all of your expenses for at least six months, but I would encourage you to have an emergency fund that is even larger than that.

#2 Don't Put All Of Your Eggs Into One Basket

If the wealth confiscation in Cyprus has taught us anything, it is that we should not put all of our eggs in one basket.  If all of your money is in one single bank account, it would be easy to wipe out.  But if you have your money scattered around a number of different places it will give you a little bit more security.

#3 Keep Some Cash At Home
This goes along with the previous point.  While it is not wise to keep all of your money at home, you do want to keep some cash on hand.  If there is an extended bank holiday or if a giant burst from the sun causes the ATM machines to go down, you want to be able to have enough cash to buy the things that your family needs.  Just ask the people of Cyprus how crippling a bank holiday can be.  One way to keep your cash secure at home is by storing it in a concealed safe.

#4 Get Out Of Debt

A lot of people seem to assume that an economic collapse would wipe out all debts, but that will probably not be the case.  In fact, if you are in a tremendous amount of debt you will be very vulnerable if the economy collapses and you are not able to find a job.  Just ask the people who were overextended and lost their jobs during the last recession.  So please get out of debt.  Many debt collectors are becoming increasingly ruthless.  In many areas of the country they are now routinely putting debtors into prison.  You do not want to be a slave to debt when the next wave of the economic collapse strikes.

#5 Gold And Silver

In the long-term, the U.S. dollar is going to lose a tremendous amount of value and inflation is going to absolutely skyrocket.  That is one reason why so many people are investing very heavily in gold, silver and other precious metals.  All over the globe, the central banks of the world are recklessly printing money.  Everyone knows that this is going to end very badly.  In fact, there is already a push in more than a dozen U.S. states to allow gold and silver coins to be used as legal tender.  Someday you will be glad that you invested in gold and silver now while their prices were still low.

#6 Reduce Your Expenses

A lot of people claim that they can't put any money toward prepping, but the truth is that we all have room to reduce our expenses.  We all spend money on things that we do not really need.  Those that are "lean and mean" will tend to do much better during the times that are coming.

#7 Start A Side Business

If you do not have much money, a great way to increase your income is by starting a side business.  And it does not take a lot of money - there are many side businesses that you can start for next to nothing.  

And starting a side business will allow you to become less dependent on your job.

In this economic environment, a job could disappear at literally any time.

#8 Move Away From The Big Cities If Possible

For many people, this is simply not possible.  Many Americans are still completely and totally dependent on their jobs.  But if you are able, now is a good time to move away from the big cities.  When the next major economic downturn strikes, there will be rioting and a dramatic rise in crime in the major cities.  If you are able to move to a more rural area you will probably be in much better shape.

#9 Store Food

Global food reserves have reached their lowest level in nearly 40 years.  As the economy gets even worse and global weather patterns become even more unstable, the price of food will go much higher and global food supplies will become much tighter.  In the long run, you will be glad for the money that you put into long-term food storage now.

#10 Learn To Grow Your Own Food

This is a skill that most Americans possessed in the past, but that most Americans today have forgotten.  Growing your own food is a way to become more independent of the system, and it is a way to get prepared for what is ahead.

#11 Nobody Can Survive Without Water

Without water, you would not even make it a few days in an emergency situation.  It is imperative that you have a plan to provide clean drinking water for your family when disaster strikes.

#12 Have A Plan For When The Grid Goes Down

What would you do if the grid went down and you suddenly did not have power for an extended period of time?  Anyone that has spent more than a few hours without power knows how frustrating this can be.  You need to have a plan for how you are going to provide power to your home that is independent of the power company.

#13 Have Blankets And Warm Clothing On Hand

This is more for emergency situations or for a complete meltdown of society.  During any major crisis, blankets and warm clothing are in great demand.  They also could potentially make great barter items.

#14 Store Personal Hygiene Supplies

A lot of preppers store up huge amounts of food, but they forget all about personal hygiene supplies.  During a long crisis, these are items that you would greatly miss if you do not have them stored up.  These types of supplies would also be great for barter.

#15 Store Medicine And Medical Supplies

You will also want to store up medical supplies and any medicine that you may need.  In an emergency situation, you definitely would not want to be without bandages and a first-aid kit.  Over the course of a long crisis, you do not want to run out of any medicines that are critical for your health.

#16 Stock Up On Vitamins

A lot of preppers do not think about this either, but it is very important.  These days, it is becoming increasingly difficult to get adequate nutrition from the foods that we eat.  That is why it is very important to have an adequate store of vitamins and other supplements.

#17 Make A List Of Other Supplies That You Will Need

During any crisis, there will be a lot of other things that you will need in addition to food and water.  The following are just a few basic things that it would be wise to have on hand...

- an axe
- a can opener
- flashlights
- battery-powered radio
- extra batteries
- lighters or matches
- fire extinguisher
- sewing kit
- tools

This list could be much, much longer, but hopefully this will get you started.

#18 Don't Forget The Special Needs Of Your Babies And Your Pets

Young children and pets have special needs.  As you store supplies, don't forget about the things that they will need as well.

#19 Entertainment

This may sound trivial, but the truth is that our entertainment-addicted society would become very bored and very frustrated if the grid suddenly went down for an extended period of time.  Card games and other basic forms of entertainment can make enduring a crisis much easier.

#20 Self-Defense

In the years ahead, being able to defend your home and your family is going to become increasingly important.  When the economy crashes, people are going to start to become very desperate.  And desperate people do desperate things.

#21 Get Your Ammunition While You Still Can

Your firearms will not do you much good if you do not have ammunition for them.  Already there are widespread reports of huge ammunition shortages.  The following is from a recent CNS News article...
"The run on ammunition has manufacturers scrambling to accommodate demand and reassure customers, as many new and seasoned gun owners stock up over fears of new firearms regulations at both the state and federal levels."
Don't just assume that you will always be able to purchase large amounts of ammunition whenever you want.  Get it now while you still can.

#22 If You Have To Go...

Have a plan for what you and your family will do if you are forced to leave your home.  If you do have to go, the following are some items that you will want to have on hand...

- a map of the area
- a compass
- backpacks for every member of the family
- sleeping bags
- warm clothing
- comfortable shoes or hiking boots

#23 Community

One of the most important assets in any crisis situation is community.  If you have friends or neighbors that you can depend upon, that is invaluable.  The time spent building those bonds now will pay off greatly during a major crisis.

#24 Have A Back-Up Plan And Be Flexible

Mike Tyson once said the following...

"Everyone has a plan until they get punched in the mouth."

No plan ever unfolds perfectly.  When your plan is disrupted, what will you do?

It will be imperative for all of us to have a back-up plan and to be flexible during the years ahead.

#25 Keep Your Prepping To Yourself

Do not go around and tell everyone in the area where you live about your prepping.  If you do, then you may find yourself overwhelmed with "visitors" when everything falls apart.

And please do not go on television and brag about your prepping to a national audience.

Prepping is something that you want to keep to yourself, unless you want hordes of desperate people banging on your door in the future.

For much more on prepping, please check out some of my previous articles...

- "Should You Move To Another Country To Escape The Collapse Of America? 10 Questions To Ask Yourself First"
- "14 Questions People Ask About How To Prepare For The Collapse Of The Economy"
- "Rise Of The Preppers: 50 Of The Best Prepper Websites And Blogs On The Internet"
- "120 Powerful Pieces Of Advice For Preppers"

Sadly, most Americans still have blind faith that our "leaders" actually know what they are doing and will be able to fix things.

Most Americans still are convinced that everything is going to be just fine.

And of course the mainstream media does all they can to reinforce faith in the system.  Day after day, we see mindless news headlines such as this: "Californians Champing at the Bit Over Powerball Debut".

But if you are reading this article that means that you are probably much more awake than the average American is.

Please get prepared while you still can.

A great storm is coming, and time is quickly running out.

So do you have any points that you would add to the list above?  Please feel free to post a comment with your thoughts below...

The men who crashed the world

The men who crashed the world

SENATOR: "Banks Still Owe Us For The Bailouts!"

"Hank Paulson is the world's greatest salesman.  We gave $700 billion to Wall Street and nobody cares."
Outstanding new interview.  Inhofe beats on Henry Paulson.
Luke Rudkowski of We Are Change interviews Senator James Inhofe about his opposition to TARP and martial law threats he received from Henry Paulson.
Not stopping TARP was my biggest failure.
"Think about how big it was -- $700 billion given to an unelected bureaucrat, with no accountability, to do anything he wanted with it.  Can this happen?  It did."
More quotes:
  • The banks still owe us about $250 billion.
  • I'm still mad at all the Republicans for voting for TARP.
  • You're the first person in 5 years that's even mentioned it.
  • That thing was $700 billion, and nobody cares.

AMBUSH: Paulson Confronted On The Streets Of NYC

ACLU catches Ohio jailing those too poor to pay fines

AFP Photo / Karen BleierRT News
A new ACLU report accuses Ohio courts of imprisoning people who are unable to pay court fees. The group, which claims to have found evidence in seven counties, likened the practice to a resurgence of debtor’s prisons – which were outlawed by the 1830s.
Entitled “The Outskirts of Hope,” the report also accuses Ohio judges of consistently denying those locked up in such circumstances court hearings to prove their financial status.  
Supreme Court precedent and Ohio law make clear that local courts and jails should not function as debtors’ prisons,” said American Civil Liberties Union staff attorney Carl Takei. “Yet many mayors’ courts and some municipal courts jail people without making any attempt whatsoever to determine whether they can afford to pay their fines.
Being poor is not a crime in this country,” said ACLU staff attorney Richard Goodman, who was quoted in the group’s announcement. “Incarcerating people who cannot afford to pay fines is both unconstitutional and cruel – it takes a tremendous toll on precisely those families already struggling the most.”
Maureen O’Connor, Chief Justice of the Ohio Supreme Court, told the ACLU on Wednesday that she would investigate the matter.
The ACLU reported that 22% of all bookings in the Huron County jail between May 2012 and October 2012 were in some way related to an inmate’s failure to pay a court debt. The Outskirts of Hope also indicates that between July 15 and August 31, 2012, Parma Municipal Court (in suburban Cleveland) jailed at least 45 defendants for their inability to pay a fine while a Sandusky court locked up 75 people for the same reason.
The Cleveland Plain Dealer reported that it costs Ohio taxpayers between $50 and $75 to jail person for one night. With an average fine of around $900, in some cases that cost eventually totals more than the unpaid fine itself. Seemingly unaware of the report, Parma Municipal Court judge Deanna O’Donnell told reporters that if there was evidence to prove the ACLU’s claim, then the courts would “fix it.”
Still, despite only focusing on seven counties, ACLU Director of Communications and Public Policy Mike Brickner warned that the problem is widespread across Ohio.
Not only are those courts violating the law, they are losing money doing it,” he said. “These practices are legally prohibited, morally questionable, and financially unsound. Nevertheless, they appear to be alive and well in Ohio. It’s like something out of a Charles Dickens novel.”

Fed Prez: "QE Is Like Ritalin, You Just Can't Overprescribe"

Fed President Richard Fisher on the Bernanke Doctrine.
Start watching at 1-minute mark.
April 4 (Bloomberg) -- Dallas Federal Reserve President and CEO Richard Fisher discusses Japan, Bernanke, QE, the stock market rally, housing, and his plan to break up the "too big to fail" banks.
Classic line on the difference between the U.S. and Japan.
"We breed here in America."

Charlie Munger Reveals His Secrets To Getting Rich

Besides taxpayer bailouts.
Munger On Gross Immorality, Rampant Debt And The Idiot Boom
Much as we ridicule Munger for his completely ridiculous bailout comments, this is actually a pretty interesting clip.  Charlie Munger, Warren Buffett's long-time partner at Berkshire Hathaway, talks with the BBC.

Matt Taibbi on Munger...
Earlier this year, Charlie Munger, who is billionaire Warren Buffett's right hand at Berkshire Hathaway and a sort of self-proclaimed mad oracle of Wall Street, made some interesting comments. He bashed people who buy gold, delivering an all-time amazing quote:
Gold is a great thing to sew onto your garments if you're a Jewish family in Vienna in 1939 but civilized people don't buy gold – they invest in productive businesses.
Munger, if you might remember, is the same gazillionaire dickhead who two years ago ripped people experiencing post-crash economic hard times, saying they should "suck it in and cope" and that anyone who wants to complain about the Wall Street bailouts should realize they were "absolutely required to save your civilization" (Munger thinks a lot about "civilization"). He added that even if you didn't like them, "you shouldn't be bitching about a little bailout. You should have been thinking it should have been bigger."
Some of those bailouts we shouldn't have complained about, of course, were directed at one of Munger's favorite companies – banking giant Wells Fargo, in which Munger and Buffett are heavily invested. Wells Fargo got as much as $36 billion in federal aid after the crash and got a massive push from the government to help it buy up the dying crash-era megabank Wachovia for $12.7 billion, a shotgun wedding that created the second-biggest bank in America. Wells Fargo not only got $25 billion in TARP funds just before it bought Wachovia, it got a special tax break from then-Treasury Secretary Hank Paulson, which some reports say was worth as much as $25 billion to WF at that time.
So just to recap Munger's comments: gold is not an investment for civilized people, it's for panicked Jews fleeing the Holocaust. Civilized people, according to Munger, instead invest in productive businesses like Wells Fargo, which according to this new suit spent a decade committing mass fraud and dumping tens of thousands of dicey loans onto the lap of the taxpayer. If we think about it in retrospect, Wells Fargo then got rewarded for years of bad behavior by receiving tens of billions more in bailout money, which it used to buy a dominating market share – artificially inflating its share price for the next generation, to the benefit of wrinkly old greedheads like Charlie Munger. And if you don't like it, you should suck it in and cope.
Continue reading...

Did Warren Buffett Sell A Million Shares Of Moody's Based On Inside Information?

European Commission 'Threatens' Portugal - Get Your Constitutional Court In Line

It seems, despite the constant "it's all fixed" banter, that Portugal's Constitutional Court decision that the Troika-imposed austerity is unconstitutional (as we discussed in detail here and here) has a few of the 'elites' nervous. And so, late on a Sunday night European time, they launch a press release that is about as passively aggressive as they come, "any departure from the program's objectives, or their re-negotiation, would in fact neutralize the efforts already made and achieved by the Portuguese citizens, namely the growing investor confidence in Portugal, and prolong the difficulties from the adjustment... it is a precondition for a decision on the lengthening of the maturities of the financial assistance to Portugal." In other words, get your constitutional court in line or the OMT 'promise' get's it! Perhaps that explains why, unlike Spain and Italy who rallied in the last few days, Portugal's bond spreads are at the widest of 2013 (70bps off the tights of the year).

Statement by the European Commission on Portugal
The European Commission welcomes that, following the decision of the Portuguese Constitutional Court on the 2013 state budget, the Portuguese Government has confirmed its commitment to the adjustment programme, including its fiscal targets and timeline. Any departure from the programme's objectives, or their re-negotiation, would in fact neutralise the efforts already made and achieved by the Portuguese citizens, namely the growing investor confidence in Portugal, and prolong the difficulties from the adjustment.

The Commission therefore trusts that the Portuguese Government will swiftly identify the measures necessary to adapt the 2013 budget in a way that respects the revised fiscal target as requested by the Portuguese Government and supported by the Troika in the 7th review of the programme.

Continued and determined implementation of the programme offers the best way to restore sustainable economic growth and to improve employment opportunities in Portugal. At the same time, it is a precondition for a decision on the lengthening of the maturities of the financial assistance to Portugal, which would facilitate Portugal's return to the financial markets and the attainment of the programme's objectives. The Commission supports that such a decision be taken soon.

The Commission will continue to work constructively with the Portuguese authorities within the parameters agreed to alleviate the social consequences of the crisis.

The Commission reiterates that a strong consensus around the programme will contribute to its successful implementation. In this respect, it is essential that Portugal's key political institutions are united in their support.

Doctors driven to bankruptcy

CNN – by Parija Kavilanz
As many doctors struggle to keep their practices financially sound,some are buckling under money woes and being pushed into bankruptcy.
It’s a trend that’s accelerated in recent years, industry experts say, with potentially serious consequences for doctors and patients. Some physicians are still able to keep practicing after bankruptcy, but for others, it’s a career-ending event. And when a practice shuts its doors, patients can find it harder to get the health care they need nearby.  
Chapter 11 bankruptcy filings by physician practices have spiked recently, noted Bobby Guy, co-chair of the American Bankruptcy Institute’s health care committee, who tracks bankruptcy trends tied to distressed businesses. Guy said there were at least eight filings in recent weeks, which he said was “very unusual.”
Five years ago, Plantation, Fla.-based bankruptcy attorney David Langley didn’t have a single doctor as a client. Since then he’s handled at least six bankruptcy cases involving doctors. Two current clients — an orthopedic surgeon and an OB/GYN — also are in bankruptcy.
None of his physician clients had malpractice lawsuits that landed them in dire financial straits. All are “top-notch doctors,” he said.
The weak economy has taken a toll on doctors’ revenue, as consumers cut back on office visits and lucrative elective procedures, said Guy, a bankruptcy attorney in Nashville with Frost Brown Todd LLC.
Doctors also blame shrinking insurance reimbursements, changing regulations, and the rising costs of malpractice insurance, drugs and other business necessities for making it harder to keep their practices afloat.
Oncologist Dr. Dennis Morgan had a profitable solo practice in Enfield, Conn., for years. Revenues began to fall, he said, when reimbursements for treatment and drugs to oncologists started shrinking. He made cutbacks, but he began having trouble meeting expenses, and his business debt grew. Critical chemotherapy drug and medical supplies providers “eventually cut me off,” Morgan said.
In June 2011, his practice, in a medically underserved area, filed for bankruptcy. It had hundreds of chemotherapy patients at the time.
For the next two years, his role became “that of a captain of a sinking ship managing the allocation of life boats until rescue arrived,” he said. He redirected patients to other doctors and area hospitals. Early last year, he stopped practicing medicine.
Having a cancer practice close can be “debilitating” to a community, said Morgan. “If you have to travel one or two hours to get treatment and you have no one to go with you, it becomes a matter of getting care or not getting care,” he said.
Primary care doctors face similar challenges. Langley recounts one client, a solo practitioner in an underserved area of Broward County, Fla., whose patients were mostly on Medicare or lacked insurance.
As the economy worsened in the wake of the recession, fewer patients could afford to come in. Cash payments and reimbursements dropped. To come up with money to keep the practice going, she took a second job at a hospital. Still, her debt ballooned. She fell behind on state tax payments.
Two years ago, Florida tax officials showed up at her door to shut the clinic down. She quickly called Langley and he was able to file an emergency bankruptcy for her online while the officials were still in the waiting room. He gave them the bankruptcy case number, and they left without closing the clinic. Langley eventually helped the doctor restructure her debt and the clinic is still open, he said.
Dr. Morgan Moor was on the brink of bankruptcy in 2011. An internist with a solo practice in Brentwood, Tenn., Moor said the recession badly hurt her once-thriving practice. By 2010, she had lost almost half of her active patients, her annual revenue had dropped nearly 30%, and she had to lay off half her employees.
“We were told that bankruptcy was our only option,” she said. So she hired Guy. Luckily, Moor said, she was able to restructure her debt and her business without filing.
Every day since has been a struggle, though. “Every payroll, I wonder if we will be able to keep doing this,” she said. “I try not to think about it because it paralyzes me with fear.”

Why US Jobs Market Is Going to Get a Lot Worse

Weak U.S. jobs data on Friday confirmed the worst trading week this year for European and U.S. stocks, and now analysts are warning that investors should brace for further trouble ahead as fiscal tightening begins to take its toll.
Friday's jobs report came in well below expectations, raising concerns that the recovery in the world's largest economy is weakening. March's participation rate was at its lowest since 1979, according to the U.S. Bureau of Labor Statistics. Just 88,000 jobs were added to the economy last month, although the unemployment rate fell to 7.6 percent from 7.7 percent in February.
"In the labor market, at least, we see a real risk of even worse news down the line," Ian Shepherdson, chief economist at Pantheon Macroeconomic Advisors said in a research note on Monday.
(Read More: US Job Creation Plunges, but Rate Drops to 7.6%)

Weakening labor demand, not rising layoffs, is the key problem with the U.S. economy, according to Shepherdson. The weakening demand is mostly coming from smaller firms that are below the radar of the Institute for Supply Management (ISM) survey, which reflects national factory activity.
The National Federation of Small Business job survey has done a decent job in foreshadowing movements in payrolls in recent years, according to Shepherdson, and it's this report—due to be released on Tuesday—that's warning of troubled waters ahead, he said.
"While actual job creation appears to be rising, plans to create jobs [in March] took a dive, falling 4 points to a net zero percent of small employers who plan to increase total employment. It seems that the stamina for growth is waning," William C. Dunkelberg, chief economist for the NFIB said in a press release last week.
Looking at the figures, Pantheon's Shepherdson said there could be a degree of respite in the official employment numbers for the next couple of months, before a distinct change.
(Read More: Unemployment Rate Dip Offers Little Reason to Celebrate)

"The outlook then turns bleaker again. The survey does not signal an outright decline in payrolls over the next few months, but we cannot be sure it has bottomed out yet," Shepherdson said.
He cited fiscal tightening as the major reason behind the reverse. At the start of the year, the payroll tax that funds Social Security was raised two percentage points to its 2010 level of 6.2 percent. This was the largest component of tax increases approved by Congress in the resolution of the "fiscal cliff" that many believe will cause a significant hit to U.S. growth.
"You can't take more than 1.5 of GDP (gross domestic product) out of the economy more or less overnight and expect nothing bad to happen," Shepherdson said. "Markets—especially the Treasury market—are having a rethink of the fiscal-tightening-doesn't matter-much hypothesis. Good. It never made any sense."
U.S. equities responded negatively on Friday to the soft jobs data, government bond yields fell with the benchmark 10-year Treasury falling to its lowest yield so far this year. The dollar also depreciated against European currencies in response.
(Read More: Job-Seeking Teens Might Get a Break This Summer)

"The data support our view that the strong U.S. data flow in January and February is likely to give way to weaker data in (the second quarter), as fiscal headwinds are reflected in slower growth in demand, activity, and employment," Barclays said in a research note on Monday. "Although we have recently raised our forecast of (first quarter) GDP growth to 3.5 percent, which matches our latest tracking estimate for the quarter, we have kept our (second quarter) forecast at 1.5 percent."
By CNBC.com's Matt Clinch

GROSS: "I'm Not The Great Investor Everyone Thinks I Am"



Decades of epic returns caused by credit expansion and debt.
Bill Gross yesterday on Bloomberg.
Pimco's Bill Gross weighs in with thoughts on his investment record, Bernanke, stock and bond markets, interest rates, Japan, Europe, Cyprus and the U.S. economy.
They discuss Bill's latest monthly letter which is here.
Man in the Mirror
Am I a great investor?  No, not yet.  To paraphrase Ernest Hemingway’s “Jake” in The Sun Also Rises, “wouldn’t it be pretty to think so?”  But the thinking so and the reality are often miles apart.  When looking in the mirror, the average human sees a six-plus or a seven reflection on a scale of one to ten.  The big nose or weak chin is masked by brighter eyes or near picture perfect teeth.  And when the public is consulted, the vocal compliments as opposed to the near silent/ whispered critiques are taken as a supermajority vote for good looks.  So it is with investing, or any career that is exposed to the public eye.  The brickbats come via the blogs and ambitious competitors, but the roses dominate one’s mental and even physical scrapbook.  In addition to hope, it is how we survive day-to-day.  We look at the man or woman in the mirror and see an image that is as distorted from reality as the one in a circus fun zone.
Continue reading at PIMCO...

Here's a list of all his monthly letters...

Bank of America to Pay $36.8 Million to Military Members for Improper Foreclosures

Bank of America will pay $36.8 million to members of the military it improperly foreclosed on between 2006 and 2010, according to a settlement it reached with the federal government in 2011, the Justice Department announced this week.
Bank of America was already paying 142 military members under the original 2011 agreement, but a further review required by the settlement found 155 additional military homeowners who were subject to improper foreclosures, the Justice Department said. In total, Bank of America will pay more than 300 military members, as Reuters reports:
Each of 316 service members will receive at least $116,785, plus compensation and with interest, for any home equity lost. [...]
“Our men and women in the military should not have to worry about a bank foreclosing on their home while they bravely serve our country,” Eric Halperin, Special Counsel for Fair Lending in the Civil Rights Division, said in a statement.
In 2011, federal regulators said banks may have improperly foreclosed on more than 5,000 members of the military and violated the Servicemembers Civil Relief Act, which provides certain financial protections to military members. Bank of America was also one of the five banks that reached a settlement with the federal government over widespread mortgage and foreclosure abuses. The Justice Department is still reviewing foreclosures from all five banks for violations of the Servicemembers act.

'Missing In Action': Congress Ignores America's Poverty Crisis

WASHINGTON -- At a time when Republicans on Capitol Hill are expressing outrage over canceled White House tours, something more deserving of outrage is taking place: tens of millions of the nation's most vulnerable are taking hits on all sides. The nation's poverty rate is frozen at a high of 15 percent. And lawmakers on both sides of the aisle, for the most part, aren't even talking about it.
"Missing in action," Rep. Marcia Fudge (D-Ohio), the chairwoman of the Congressional Black Caucus, said of Congress' record on poverty.
It has been a topic of discussion among Washington lawmakers in fleeting moments. Language about making poverty a national priority found its way into the Democratic Party platform last year and into President Barack Obama's State of the Union address in February. Democrats tucked a line into their budget proposals this year calling for a strategy to cut poverty in half in 10 years.
Yet the issue has all but disappeared from the legislative agenda in Congress as lawmakers focus squarely on deficit reduction. Obama, too, has been largely silent on the issue, and has even proposed cutting Social Security -- a key tool for combating poverty. Sen. Bernie Sanders (I-Vt.), a leading voice for the poor in the Senate, has fumed that Obama is caving to Republicans on the issue at the expense of "millions of working people, seniors, disabled veterans, those who have lost a loved one in combat, and women."
The statistics are staggering. According to the Census Bureau, the nation's poverty rate is at its highest level in decades. More than 46 million people -- one in seven Americans -- are living below the poverty line, 16.4 million of them children. Another 30 million Americans are just a lost job or serious illness away from joining them. And in the last six years alone, more than 20 million people have joined the ranks of those relying on food stamps to get by.
Meanwhile, the rich are only getting richer. Income inequality in the United States is greater now than at any time since 1929. It has gotten so severe that, according to a report by the nonpartisan Economic Policy Institute, low-earning workers in the United States are actually worse off than low-earning workers in all but seven similarly developed countries.
Given these figures, it is "unfathomable" that poverty is not "at the top of everybody's priority list," Fudge told The Huffington Post.
Many economists agree that the most effective thing Congress has done for poor people in recent years was pass the stimulus package in 2009. It was one of the first bills Obama signed into law as president, and it included substantial benefits for the poor, including an expansion of the child tax credit and new funds for child care, job training and the Temporary Assistance for Needy Families program, the nation's principal welfare program.
The package is credited with saving or creating 2.5 million jobs, growing the economy by up to 3.8 percent and keeping the unemployment rate from hitting 12 percent. As bad as things are now, they could have been much worse, economists say.
Given the subpar unemployment rate -- it's been hovering just below 8 percent for months -- and the worsening conditions for the poor, some say the obvious response from Congress should be another stimulus.
"It would be one thing if this were happening and there wasn't something we could do," said Heidi Shierholz, an economist at EPI. "The thing that makes this tragic and sick is that Congress could do a stimulus bill and bring the unemployment rate down relatively quickly, and they're choosing not to."
Shierholz acknowledged that the idea of Congress passing a stimulus "sounds ridiculous" given that lawmakers are banging the drum on austerity right now. But the economics are clear.
"The increase in the poverty rate that we've seen since 2007, we could bring that down if we wanted to," she said. "It is crisis number one. But with this Congress right now, it's just a question of trying to keep them from doing harm. We're actually implementing austerity policies right now, which is absolutely wrongheaded."
Those austerity policies include the sequester, $85 billion in across-the-board spending cuts that Congress agreed to let take effect on March 1, which will come down hard on the poor. That belt-tightening comes on top of the more than $1.5 trillion in spending cuts that Congress has passed in the past several years.
From a political standpoint, it's not hard to see why lawmakers wouldn't want to talk about poor people. Poverty isn't the most glamorous topic. It doesn't have powerful lobbying groups behind it that can make or break someone's reelection, and it doesn't ignite people's passions in the same way that gay marriage or gun control does. Politicians in both parties rarely bring up poverty on the campaign trail.
"How many times throughout the presidential election or in congressional elections do you ever hear the word 'poor?'" Fudge asked. "It does not poll well. It is not a word used often."
But polling aside, the reality is services for the poor are taking more and more hits in many districts, a fact that isn't necessarily reflected in the voting records of the lawmakers who represent them. Half In Ten, a campaign focused on cutting the nation's poverty rate in half in 10 years, released a chart that breaks down which lawmakers represent the poorest districts. While the chart draws from data that was released prior to congressional redistricting in 2012, an analysis of Republican lawmakers' districts before and after redistricting reveals a number of members with high poverty rates back home who voted last month to pass the budget put forward by Rep. Paul Ryan (R-Wis.), which would decimate funding for programs for the poor, disabled and elderly.
Budgets aren't binding documents, but the Ryan plan is a "statement of priorities" that effectively demonstrates where lawmakers stand on poverty issues, said Melissa Boteach, the director of Half In Ten and of the Poverty and Prosperity Program at the Center for American Progress.
"The Ryan budget kicks 12 to 13 million people off of nutrition assistance, cuts off pathways to opportunity, slashes job training and education, and makes draconian cuts to Medicare, which serves a majority of the disabled and the elderly," said Boteach. "That's how House Republicans have outlined their priorities."
Among those who voted for Ryan's budget: Rep. Hal Rogers (R-Ky.), the chairman of the House Appropriations Committee, whose district has a roughly 28 percent poverty rate and 38 percent child poverty rate; Rep. Rodney Alexander (R-La.), whose district has a roughly 26 percent poverty rate and 37 percent child poverty rate; Rep. Paul Gosar (R-Ariz.), whose district has a roughly 17 percent poverty rate and 25 percent child poverty rate; Rep. Ted Yoho (R-Fla.), whose district has a roughly 16 percent poverty rate and 19 percent child poverty rate; and Rep. Tom Rooney (R-Fla.), whose district has a roughly 16 percent poverty rate and a 26 percent child poverty rate.
The Huffington Post reached out to those Republican congressmen for comment. Two responded, and with the same message: deficit reduction equals poverty reduction.
"We've had record levels of government spending these past few years, yet we continue to have high levels of poverty," Gosar said. "Clearly more government spending has not restored economic growth or revived opportunity for those in search of the American dream. We need more, not less, of what we know creates growth and prosperity -- free markets, low taxes, and limited government."
"As someone who has experienced poverty, I understand the federal government's role in protecting the opportunity for every American to achieve their version of the American Dream," Yoho said. "Unless we get our fiscal house in order now, those opportunities are in danger. Fiscal responsibility at the federal level is crucial to combating poverty, and that's one of the reasons I voted for the House Budget."
Lawmakers who have championed poverty issues were beside themselves at the idea of colleagues voting to gut programs for the poor when there are so many poor people in their districts.
"It's mind-boggling," Rep. Barbara Lee (D-Calif.) said. "I don't know how they treat their constituents. I don't know how they relate to their people."
But Lee knows from experience that poverty isn't a popular topic on Capitol Hill. She created an Out of Poverty Caucus in 2007 and got about four dozen lawmakers to join. In the last Congress, the caucus introduced six bills and endorsed two more that, collectively, would have beefed up programs ranging from nutrition assistance to job training to affordable housing. But none of the proposals even got a committee hearing.
Lee didn't seem disheartened. She emphasized that there are multiple ways to influence policy.
"The big, big problem and obstacle is with the Republican Tea Party Congress. They want to dismantle everything right now," she said. "Right now, I don't see a lot of momentum on poverty issues, so we're trying to build momentum on the outside. There are a lot of great campaigns."
Just about all stakeholders would agree that job creation is the best way to lift people out of poverty. But in the current Congress, the appetite for any kind of major jobs package just isn't there. Obama put forward an ambitious, $447 billion employment bill last year that many economists believed had the potential to create millions of jobs, but it was met with swift opposition from Republicans.
So what, then, does Congress plan to do about poverty in the next year and a half? Debate a handful of smaller bills. The Senate will take up a bill "sometime this year" to raise the minimum wage from $7.25 to $10.10, according to a top Senate Democratic aide. In the House, a Republican leadership aide pointed to three items that GOP leaders say will help the poor: a welfare reform reauthorization bill, the Supporting Knowledge and Investing in Lifelong Skills Act and a renewed focus on education.
The problem is, none of those proposals have bipartisan support. The author of the minimum wage bill, Sen. Tom Harkin (D-Iowa), has been predicting GOP resistance from the moment he introduced his bill. "Republicans will throw up a smokescreen about it costing jobs," he said at the bill's unveiling.
The House Republican proposals, meanwhile, lack Democratic support, and their effectiveness is questionable. The welfare reform bill only targets 4 million of the nation's 46 million working poor, and the SKILLS Act, which would consolidate more than 30 workforce development programs into a single fund, would actually make it harder for vulnerable groups like the elderly and disabled to access job training, according to the White House Office of Management and Budget.
As for increasing the focus on education, it's true that House Majority Leader Eric Cantor (R-Va.), who controls which bills get House votes, recently signaled a desire to make the issue more of a priority. But his interest appears to center on school vouchers, which Democrats say would decimate public education.
So, for the time being, it looks like the nation's working class and poor won't be getting much help from their leaders on Capitol Hill.
Perhaps the best that advocates for the poor can do for now is try to prevent services from being scaled back even more. Lee said she is using her role on the House Budget Committee to try to preserve key items that Republicans have put on the chopping block, including the Earned Income Tax Credit, the Child Tax Credit, food stamps and unemployment insurance. Lee also has a bill that would direct federal agencies to look at their impacts on poverty, and she suggested that poverty-related amendments to Republican bills may be an option.
Lee and Fudge are also trying to keep poverty in the spotlight as much as possible. The Congressional Black Caucus is pressing the White House to create a commission on poverty, and members of the caucus are reaching out to the Republican Study Commission, which has its own anti-poverty initiative, to see if they can find ways to tackle poverty together. House Majority Whip Steny Hoyer (D-Md.) recently launched a task force on poverty within the Democratic Caucus, which Lee will lead.
"We have to keep working at it," Lee said of forcing poverty into the forefront in Washington. "We have to focus on accountability. Congress will support an agenda if they care about it. This a political struggle like everything is."

REPORT: United Nations Seeks New 'GLOBAL' Tax


Guess who'll be paying the most under the proposal.
Give this 2 minutes and hear the list of taxes planned by the U.N.
Excellent discussion between Neil Cavuto and former U.K. Parliament member John Browne, (now U.S. citizen and political truth teller) on Sep. 28, 2012.

Over the weekend:

WATCH: Joe Biden Calls For 'New World Order'

Graduate with physics PhD, 31, fell to his death from block of flats after taking job in call centre he was over-qualified for

  • Dr Philip Elliott recently competed a degree at Reading University
  • In the weeks leading up to his death he had suffered a number of career knock backs
  • The 31-year-old fell from the roof of an apartment block in west London

  • Academic achiever: Dr Philip Elliott suffered a number of career knock-backs in the weeks leading to his death
    Academic achiever: Dr Philip Elliott suffered a number of career knock-backs in the weeks leading to his death
    An academic jumped off scaffolding to his death when he was only able to find a job in a call centre after finishing his doctorate, an inquest heard today. 
    Dr Philip Elliott, 31, who had recently completed a PhD in physics at Reading University, was seen on the sixth floor of an apartment block in west London just after 11am on January 27 this year.
    Police tried to call him down but he fell from the property in Cromwell Street, Kensington, an hour later, the hearing was told.
    Westminster Coroner's Court heard Dr Elliott - who was also a qualified engineer and was described as a 'high academic achiever' - had suffered a number of career knock-backs in the weeks leading to his death.
    His landlord of seven years Harry Duphnath said the most recent he knew of was in December last year.
    In a statement read to the inquest Mr Duphnath said: 'I was aware Philip had started a job with Southern Electric - I think in a call centre - which wasn't what he aspired to.
    'He mentioned being frustrated at work and unhappy about being there and had started looking for other jobs and going for interviews.
    'The last one was the week before Christmas in 2012.
    'I saw him ironing his shirt getting ready for the interview.
    'While I was there he checked his emails and he had one which said the interview had been cancelled.
    'He was a bit low about that, but he wasn't angry. He said that he would plod on and keep going.'
    The landlord said he received a text message from Dr Elliott on January 24, three days before his death, apologising for not doing some tidying up. 
    It read: 'Sorry. I've had a terrible time the last three weeks. Thanks for your patience. I can't explain how stressful it's been, but I appreciate it's not your fault.'
    Mr Duphnath said him and his wife Sonia were 'utterly shocked' to hear Philip had taken his life days later. 
    Low: The coroner could not say for certain if Dr Elliott meant to take his own life and said his actions could have been a 'cry for help'
    Low: The coroner could not say for certain if Dr Elliott meant to take his own life and said his actions could have been a 'cry for help'
    Det Con David Gadsby, of the Metropolitan Police, said a resident in the block where Dr Elliott died reported hearing footsteps on the roof at 9.30am that morning, but thought nothing of it and went back to bed.
    An hour-and-a-half later a motorist driving past the building called police expressing concern a man might be preparing to jump.
    Officers arrived within five minutes but were advised not to talk him down as it was too dangerous to get out onto the scaffolding.
    Paramedics who were already on the scene tried to revive him but the science mad graduate was pronounced dead from multiple injuries at 12.10pm.
    Westminster Coroner Darren Stewart said he could not be sure beyond reasonable doubt that Dr Elliott meant to take his own life as it could have been a 'cry for help.'
    Recording a narrative verdict, he explained: 'It is clear he was a high academic achiever in science, having achieved a PhD from the University of Reading, but he had not been able to get a job for some time. 
    Scene: Dr Philip Elliott was seen on the sixth floor of this apartment block in west London on January 27 before he fell
    Dr Philip Elliott was seen on the sixth floor of this apartment block in west London on January 27 before he fell, Westminster Coroner's Court heard (pictured)
    'He took work which was perhaps not entirely suited to his skill sets in that he was working in a call centre.
    'However, it shows Dr Elliot was committed to gaining employment and to progressing in his life. 
    'What is clear from the evidence is that he received a number of blows to his confidence in terms of jobs he aspired to which were either unsuccessful or withdrawn.
    'It is clear that this had an impact on his general morale, and on the 27th of January 2013 Dr Elliott climbed up on to some scaffolding in Cromwell Road, Kensington.
    'Officers decided not to try and talk Dr Elliott down as it would have been dangerous to them and to him.
    'Sadly, shortly thereafter, Dr Elliott made a gesture with his arms and appeared to dive towards the ground striking the pavement.'
    He added: 'Police enquiries revealed no indication Dr Elliott's actions were planned or that he had intended to take his life, nor is there any evidence to suggest Dr Elliott was subject to any mental health care.
    'Whilst perhaps disappointed and suffering from a degree of depression due to his lack of work opportunities he was otherwise a fit, intelligent young man who had achieved well at university.
    'It makes the outcome of what occurred on January 27 2013 all the sadder due to that.
    'I am not satisfied on what has been presented before me as to be certain Dr Elliott intended to take his own. It is entirely possible this could have been a cry for help.'
    None of Dr Elliott's family attended the inquest in central London, but they have since set up a remembrance page in his memory.
    • For confidential support call the Samaritans on 08457 90 90 90 or visit a local Samaritans branch, see www.samaritans.org for details.

    China looking at direct yuan trade with Australian dollar

    Yuan move would lower transaction costs, deepen ties with vital commodities supplier
    China may soon allow its currency to trade directly with the Australian dollar, according to officials from the central bank and a top government think tank.
    The official at the People's Bank of China, who did not want to be identified, said moves were afoot to allow direct trade settlement between Australia and China, rather than through the US dollar, lowering transaction costs. He said the possibility was under discussion at the Boao Forum, on Hainan, but refused to provide a time frame.
    There has been speculation that direct offshore trade settlement is high on Australian Prime Minister Julia Gillard's agenda on her current trip to China.
    Zhang Ming, a deputy director of the Department of International Finance at the Institute of World Economics and Politics of the Chinese Academy of Social Sciences, said the two governments might move in that direction "quite soon".
    Zhang said direct trading would promote internationalisation of the yuan and boost its circulation. "It will make yuan more attractive overseas," he said.
    Xiang Songzuo, deputy chief of the Institute of International Currency at the People's University, also said Beijing has been weighing the idea for some time and although he would not guess when the policy will be formally announced, said: "It could be quite soon."
    Direct settlement will allow the two currencies to sidestep the US dollar as a means of exchange, lowering exchange-rate risks for traders in addition to reducing transaction costs.
    It will also help the two countries cement financial ties. China is Australia's No 1 trading partner. In January, Australia imported goods worth A$3.8 billion (HK$30.6 billion) from China, and its exports to China amounted to A$6.2 billion - nearly a third of its total exports.
    Beijing says it wants about a third of its foreign trade settled in yuan by 2015. China already allows direct trading between its currency and that of Japan, one of its biggest trading partners.
    Another person with knowledge of the matter, who also declined to be named, said Beijing will appoint around 10 banks as market makers for yuan-aussie trades, including several major Chinese banks and counterparts from Australia and elsewhere.
    Zhang said the move would not affect the value of the Australian dollar and should have no impact on Hong Kong investors in the currency.