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Interest Rates

[ 136 ] November 18, 2015 |


I’m surprised the Federal Reserve hasn’t raised interest rates yet as it’s been rumored for a good year. But the time is coming, despite Janet Yellen doing some work to forestall it thus far. And it is a bad idea because not only is inflation not a problem, but the underlying economic factors that are creating problems for the middle class can’t even be addressed if we don’t raise rates, not to mention if we do. Robert Kuttner:

That said, even if the Fed kept interest rates at effectively zero for another year, it’s increasingly clear that monetary policy alone is not sufficient to get unemployment rates down to where they need to be—or to translate falling jobless rates into raises for workers. During the past few decades, there have been momentous changes in the structure of employment.

Unions are weaker than they have been since before the Wagner Act of 1935. The combination of outsourcing, union-busting, and the creation of part time, temp, contract, and on-demand jobs as the new normal means that a low nominal unemployment rate doesn’t produce the pressure for wage increases that it once did.

Plus, the Obama administration has colluded with the Republicans in believing that we need more deficit reduction. So liberal monetary policy collides with overly tight fiscal policy, as well as trade policy that will promote more outsourcing and export of good jobs.

In short, unless we get major reforms in labor markets, to protect workers from the on-demand economy, plus massive public investment to create millions of good jobs, whether monetary policy is a little tighter or a little looser won’t be a game changer. Still, raising rates eliminates one of the few sources of economic stimulus that we have.

The fact that inflation phobia has been consistently disproven by events for seven years has not stopped the monetary hawks. The fact that a progressive economist like Yellen has been prodded into embracing a rate hike is testament to the immense undertow of the conventional wisdom.

But inflation!!!!!!! It’s always 1978 for the economists.


Shorter Chris Christie: “Nits Make Lice”

[ 23 ] November 17, 2015 |


Above: New Jersey governor Chris Christie

Christ, what an asshole.

Gov. Chris Christie on Monday said the United States should not admit any refugees from the Syrian civil war — not even “orphans under age 5.”

“I do not trust this administration to effectively vet the people who are supposed to be coming in in order to protect the safety and security of the American people, so I would not permit them in,” the Republican presidential candidate said on conservative talk show host Hugh Hewitt’s syndicated radio show.

Some 12 million Syrians have been forced from their homes due to Syria’s raging civil war, with half of them children, according to the Christian relief charity, WorldVision. More than 4.2 million Syrians have fled for countries like Turkey, Germany, Jordan and Lebanon, according the U.N.

When asked about this on Monday night, Christie at first demurred, saying that “we can come up with 18 different scenarios.”

Then, he said: “The fact is that we need for appropriate vetting, and I don’t think that orphans under 5 should be admitted to the United States at this point.”

“We need to put the safety and security of the American people first,” Christie said.

This immediately reminded me of one John Chivington, who said this when ordering his troops slaughter the Cheyenne and Arapaho at the Sand Creek Massacre.

Some regular army officers protested that to attack the peaceable village would betray the army’s pledge of safety. Chivington ignored them. “Damn any man who sympathizes with Indians,” he said. “Kill and scalp all, big and little; nits make lice.” He ordered the attack.

Nits make lice. Better keep all the little towelheads out. I think that will be on the Republican platform next year.

….I see Scott beat me to the punch. Great minds and the like.

Gun Rights are White Rights

[ 61 ] November 17, 2015 |


Another reminder that gun rights are a euphemism for white rights:

A Texas state legislator wants the U.S. to stop allowing Syrian refugees into the country. His reasoning: They might be able to buy guns in his state.

Rep. Tony Dale (R) made this argument in a television interview on Monday and in letters to Texas’ U.S. Sens. John Cornyn and Ted Cruz (R) and U.S. Reps. Michael McCaul and John Carter (R).

“While the Paris attackers used suicide vests and grenades,” Dale wrote, “it is clear that firearms also killed a large number of innocent victims. Can you imagine a scenario were [sic] a refugees [sic] is admitted to the United States, is provided with federal cash payments and other assistance, obtains a drivers license and purchases a weapon and executes an attack?” He urged the lawmakers to “do whatever you can to stop the [Syrian refugee] program.”

But Dale is one of the Texas legislature’s most fervent gun-rights advocates. Two weeks ago, he tweeted his National Rifle Association membership renewal. In accepting an “A” rating from the group and the Texas State Rifle Association’s PAC in 2012, he observed: “Perhaps no right is more fundamental than the right to keep and bear arms.” And his campaign website vows his fealty to the Second Amendment, saying it “isn’t just an archaic document,” a “guarantor of all of our other freedoms.” And he and his colleagues in the state legislature have blocked mandatory background checks for all gun purchases.

Of course conservatives like Ronald Reagan were all about Second Amendment restrictions when it was Black Panthers carrying guns into the California statehouse and following cops to stop police brutality. And the National Rife Association was a benign hunters group until it got caught up in the white backlash to civil rights in the 1970s and transformed itself into the fanatical devotee of gun rights it is today. The modern gun rights movement and white rights movement have always been intertwined. These connections need a lot more exploration than the occasional note that some Texas state legislator is freaking out about Muslims buying guns but wants all the whites in his state to be armed to the teeth.


[ 39 ] November 17, 2015 |


Allow me to indulge in my continual project of self-promotion around Out of Sight one more time. I am speaking tomorrow evening at AS220 in Providence from 5:30-7:30 (actual speaking will begin at 6) and I hope to see some of you there. The event is being hosted by the great progressive site RI Future and they have been featuring me for a week. There’s a 3-part video interview with me you can watch. The first part is on the book, the second is on the Trans-Pacific Partnership (only 16 minutes on the TPP!!!) and the third is on my relative indifference to the Democratic primary. I also did a subsequent Q&A with Rhode Island journalist Philip Eil, which allowed me to go into my disdain for Rhode Island beer and to tell people to buy Wussy albums.

Books will be for sale and I will be happy to sign those books. You can even buy me a beer if you want. No vodka though.

Finally, you can listen to my conversation with Sarah Jaffe on the Dissent podcast, Belabored.

This is the last scheduled book event but I hopes for a couple more and will announce them if they work out. Certainly I am happy to go anywhere and talk to anyone if we can work out the travel arrangements.

…Also, Chapter 1 of the Shakezula-curated reading group on Out of Sight is happening December 3. Read away!

Reading Can Get You on a Terrorist Watch List

[ 20 ] November 17, 2015 |

I was just browsing in the library. I picked up Philip Sarasin’s Anthrax: Bioterror as Fact and Fantasy, published by Harvard in 2006. I opened the book. This is what I saw.


I’m glad to know reading is a threat to the United States. Or at least it was to the Bush administration. I’m sure Ted Cruz and a whole slew of Republican governors approve.

UPDATE: Evidently this was a stunt by students to make a point. Which is a whole other level of interesting.

Today in the Rhode Island Democratic Party Dumpster Fire

[ 31 ] November 16, 2015 |


Above: The Rhode Island Democratic Party

I’ve talked before about how the Rhode Island Democratic Party is an out of control dumpster fire. In a 1-party state, being a Democratic politician means nothing more than “I want power.” That’s how you have the Rhode Island Democratic Party borrowing legislation from Oklahoma banning municipalities from setting their own minimum wages. It’s also how you have an open racist as the Speaker of the House.

One of Rhode Island’s most powerful Democrats doesn’t believe that “white privilege” exists. In a recent interview with the Providence Journal, Nicholas Mattiello, the state’s speaker of the House, said that that racial disparities are simply due to African-Americans’ and other minority groups’ failure to “take advantage” of the opportunities available to them.

Mattiello was invited to discuss racial issues with a panel from The Providence Journal, which is producing an extensive series on race in Rhode Island. He told the panel that, before he was asked that question, he had never thought of the phrase “white privilege.”

Mattiello was responding to an op-ed previously published in The Providence Journal by David R. Carlin, the former Democratic Senate Majority Leader, which argued that racial disparities were the result of “appallingly dysfunctional subculture that is pervasive among the black lower classes.”

This subculture fosters attitudes that lead to astronomical rates of out-of-wedlock births, millions of fathers who give little or no support to their children, high rates of crime and violence, high levels of drug abuse, a poor work ethic and very poor academic achievement. Unless this subculture is eradicated, we may expect that great numbers of blacks will live in misery.

Mattiello said he wasn’t sure about the phrase “subculture,” but seemed to agree with the overall point — namely, that “white privilege” doesn’t exist and that there is a “breakdown” within minority communities that explains racial disparities.

“You have to find ways to get the community to access and to take advantage of [opportunity]. Some people do, but not enough do. And there’s a reason why they don’t, and that’s something that I quite frankly don’t understand, and I need help with that,” Mattiello said.

Mattiello said that education was “the great equalizer” but dismissed criticisms that Rhode Island schools were effectively segregated. “I would say that it’s not segregated, it’s just that it reflects the population that it serves… I don’t know that you start busing people and so forth.”

“I don’t see racism because that’s not how I live my life… But I’ve never seen it because it’s not the way I live. And I’ve never been the victim of it,” Mattiello added.

Well, I guess he at least admits that racism might exist. But of course he’s not racist because no one is racist in 2015 except for people who believe that white privilege might exist or people who voted for Obama and therefore support the war on whites. Meanwhile those black people are just lazy and the state’s significant segregation just happens because white people like to live next to white people and black people choose to live that way.

My disdain for third parties is well-known, but really it’s a different beast on the state level. In Rhode Island, with the Republican Party a non-entity at the local level in most districts and the Democrats who do get elected (not all, but a sizable number including Mattiello) essentially Republicans themselves in Democratic clothing, there really isn’t any reason not to at least try to primary these people. While I remain skeptical that building a state-level third party is a good use of resources because, like on the federal level, the energy that goes into the party-building could be better spent on issue-based campaigning, one can certainly make a much better case for it in Rhode Island than nationally.

Bought and Sold by Dirty Energy

[ 6 ] November 16, 2015 |

When David Vitter isn’t missing votes to visit prostitutes, he’s a paid man of the oil and gas industry.

Sen. David Vitter (R-LA), who last month won a spot in Louisiana’s upcoming gubernatorial run-off, made an appearance late last week on the SportsChat radio show out of Acadiana. When the discussion turned to policy, the host asked Vitter to name an example of somewhere he’d like to cut the deficit. The Louisiana Republican pointed to encouraging solar panels as an example of government excess.

“We have some tax credits that are really giveaways and spending items by another name. For instance, the solar tax credit. That’s a check from the taxpayers for folks to buy solar panels,” Vitter said. “It’s really a spending program and it’s a big check. I don’t think the state taxpayer should be in the business of buying folks solar panels, mostly folks who are perfectly well off.”

Vitter has received over $1 million in donations from dirty energy industries through his political career.

As for the question of taxpayer support of clean energy, the obvious rejoinder but one that is never effective, is that taxpayers have supported the oil and gas industries for decades.

ouisiana has devoted around $147 million to solar tax credits since 2009, covering half the cost of rooftop installations. State lawmakers have already passed legislation to end solar tax credits by the end of 2017.

Meanwhile, the oil and gas industry has collected over $2.4 billion from Louisiana taxpayers since 2008, according to a new documentary. In other words, for every $1 in tax credits that goes towards the solar industry annually, approximately $14 goes to oil and gas companies.

In addition, those oil and gas tax credits could balloon to $1 billion annually with continued growth in the fracking industry, according to some estimates.

But these are naturalized forms of support, going back so long that no one thinks of them as taxpayer subsidies anymore. Meanwhile, solar energy is something hippies like so it’s a waste.

Ban the Box

[ 30 ] November 16, 2015 |


I don’t think anyone mentioned this when it happened two weeks ago, so let me do so here. Obama deciding to “ban the box,” i.e., eliminate the job application question about an applicant’s criminal record for the federal government, is an important step forward for both racial and labor justice. As is common, racial justice is labor justice and labor justice is racial justice. This movement has enough momentum that at least a few Republicans, like Chris Christie, are also supporting it. Hopefully, we can eliminate this discriminatory question from job applications entirely. The question is inherently racist given the racism of the criminal injustice system and it furthers institutionalized racism and poverty for people convicted of nothing more than holding marijuana while black.

Today in the Sixth Extinction

[ 58 ] November 15, 2015 |


After humans finish with the Sixth Extinction, presumably ending in our own species going extinct, what will the planet look like? Probably filled with small creatures:

From sharks to giraffes, many of Earth’s biggest and most magnificent species are threatened with extinction. A new study of the fossil record indicates that once large vertebrates disappear, evolution cannot quickly restore them — for tens of millions of years, most animals remain small.

The study, published Thursday in Science, emerged from research carried out by Lauren Sallan, a paleontologist at the University of Pennsylvania.

Studying fish that lived during the Mississippian Period, from 359 million to 323 million years ago, she noticed that they were substantially smaller than their ancestors.

“It piqued my curiosity,” Dr. Sallan said in an interview. “Why are these fish so small?” (She earned a nickname from her fellow paleontologists: the Sardine Queen.)

Other paleontologists had previously noticed that some groups of species seemed to shrink in size over time. It’s called the Lilliput Effect, after the fictional island in Jonathan Swift’s “Gulliver’s Travels” inhabited by tiny people.

Researchers found that the Lilliput Effect often occurred after abrupt and widespread extinctions. Dr. Sallan’s fish appeared to fit the pattern: They shrank after a mass extinction at the end of the Devonian Period, 359 million years ago.

Likely this means that house cats complete their takeover of the world, probably assisted by their jellyfish allies in the ocean.

It May Not Surprise You That……

[ 95 ] November 15, 2015 |


Giant corporations and their outsourcing firm friends are gaming the H1-B Visa program to get almost all of the immigrants, squeezing out all other employers.

Congress set up the H-1B program to help American companies hire foreigners with exceptional skills, to fill open jobs and to help their businesses grow.

But the program has been failing many American employers who cannot get visas for foreigners with the special skills they need.

Instead, the outsourcing firms are increasingly dominating the program, federal records show. In recent years, they have obtained many thousands of the visas — which are limited to 85,000 a year — by learning to game the H-1B system without breaking the rules, researchers and lawyers said.

In some years, an American employer could snag one of these coveted visas almost anytime. But recently, with the economy picking up, the outsourcing companies have sent in tens of thousands of visa requests right after the application window opens on April 1. Employers who apply after a week are out of luck.

“The H-1B program is critical as a way for employers to fill skill gaps and for really talented people to come to the United States,” said Ronil Hira, a professor at Howard University who studies visa programs. “But the outsourcing companies are squeezing out legitimate users of the program,” he said. “The H-1Bs are actually pushing jobs offshore.”

Those firms have used the visas to bring their employees, mostly from India, for large contracts to take over work at American businesses. And as the share of H-1B visas obtained by outsourcing firms has grown, more Americans say they are being put out of work, or are seeing their jobs moved overseas.

Of the 20 companies that received the most H-1B visas in 2014, 13 were global outsourcing operations, according to an analysis of federal records by Professor Hira. The top 20 companies took about 40 percent of the visas available — about 32,000 — while more than 10,000 other employers received far fewer visas each. And about half of the applications in 2014 were rejected entirely because the quota had been met.

Two of those applications came from Mark Merkelbach and his small engineering firm in Seattle. For water projects in China, he needed engineers and landscapers who speak Mandarin, and he could not find them in the local market. With his H-1B visas denied, Mr. Merkelbach had to move the jobs to Taiwan. Another denial went to Atulya Pandey, an entrepreneur from Nepal who founded an Internet company in the United States and now can no longer work legally in this country for his own business.

This is just more evidence that we need legal crackdowns on outsourcing if we want to preserve any sort of American jobs. The H1-B Visa program should be a good thing that helps build the nation through bringing in workers that can help companies while diversifying the nation. But this level of abuse by corporations who want to outsource as many employees as possible is actually forcing work abroad. The system needs serious reform if it doesn’t contribute to income inequality and joblessness rather than promoting the needs of innovative companies.

The TPP and Labor Rights

[ 25 ] November 15, 2015 |


Finally, details of the Trans-Pacific Partnership are going public. A few points and initial thoughts.

The deal would grant multinational corporations the right to challenge laws and regulations in secret tribunals when they are considered trade barriers. Countries can ban tobacco companies from taking part in these tribunals.

The agreement’s language was influenced by multinational companies including pharmaceutical firms, recording studios, agribusinesses, and others. Critics say the deal was forged in secrecy.

The pact calls for improved freedoms and more attention to the needs of indigenous people and overall public health, better access to medicine for people living in the TPP countries and increased protections for drug patents.

Malaysia, whose Prime Minister Najib Razak is accused of stealing nearly $700 million from a development fund, would be required to allow freedom of movement for victims of human trafficking and negate rules restricting labor unions.

With the threat of trade sanctions, TPP countries are required to ban child labor and employment discrimination and give workers the right to form unions.

New markets would open for Vietnamese clothing firms and Malaysian electronics companies.

First, the Investor State Dispute Settlement courts are still horrifying precisely because there is no accountability at all. If nations can’t pass laws based on their own interest without extra-legal courts overruling them, that’s a major defeat for democracy worldwide. That tobacco companies are excluded actually just reinforces this point because all it is doing is claiming one industry is too immoral for these courts. Thus an exception is claimed but who decides in the future if an interest lacks the moral fiber to participate? I don’t per se have a problem with international courts making some level of decision on trade issues. But they have to have some sort of openness and accountability and they have to allow citizens some level of access. Creating international law that undermines the ability of citizens to improve their own nations is a horrible idea.

The greater powers to Big Pharma, agribusiness, and entertainment companies are all deeply problematic, allowing primarily American companies to profit off poor nations by undermining the ability to provide cheap medicines and the extension of America’s ridiculously pro-corporate copyright laws.

I simply don’t believe that the provisions around labor rights will be enforced. We have a long history of trade deals and they never work out for worker rights. Malaysia is required to crack down on its human trafficking, but what is the actual consequence for not doing so? As we saw from the Obama administration’s reclassification of Malaysia’s human rights record in order to allow that key trading partner into the TPP, it’s unlikely, especially as many administrations in the future are likely to care less about international labor rights than Obama. And while banning child labor and the like is great in principle, if workers can’t access this agreement and instead it depends on nations and their powerful corporations, all of whom have interests in keeping this system of child labor, color me extremely skeptical about all of this.
Judy Gearhart of the International Labor Rights Forum has similar thoughts:

In fact, language for an effective labor chapter offered by a coalition of national union federations from the affected countries was largely ignored:

The agreement makes no progress on enforcement, ignoring common-sense proposals like requiring the parties to conduct timely, impartial investigations of allegations of non-compliance and firm deadlines for implementing necessary reforms.

Requests to prohibit the trade of goods made with forced or child labor and to establish mechanisms to seize such goods at the border came out with the TPP merely “discouraging” trade in goods made with these egregious human rights violations.

Requests to include protections for migrant workers, such as regulating labor recruiters or prohibiting confiscation of passports, were wholly ignored, despite well-documented, systemic exploitation of migrant workers in a number of TPP countries.

Proponents of the TPP argue that separate bilateral agreements on labor and human rights for Vietnam, Malaysia and Brunei will improve conditions in these countries despite long-standing disregard for the most fundamental human rights, such as freedom of association and elimination of forced labor. This argument is based on the flawed premise, however, that serial labor rights violators will make necessary reforms after they receive the benefits up front.

We have seen this approach fail repeatedly. In the lead up to the CAFTA vote in 2005, the Bush Administration promised that the U.S. government would hold Guatemala, Honduras, and other parties accountable if they failed to improve their dismal records on labor rights enforcement. Ten years later, despite the filing of complaints that clearly show how Guatemala and Honduras continue to fail to enforce their labor laws, worker organizers continue to face threats, abuse, and worse. The Solidarity Center reported last month that more than 70 worker activists have been killed in Guatemala since 2007, and the AFL-CIO reported more than 30 were killed in Honduras since 2009.

I just talked about how these trade agreements have consistently failed Guatemalan workers. There’s not much reason to believe that nations like Vietnam and Malaysia will treat workers any better. As Gearhart states, if you give all the benefits for nations who have no interest in labor rights up front, they are unlikely to then enforce those rights and it’s even more unlikely that the corporations with major investments in these economies are going to accept those nations being thrown out of the agreement or pressing major sanctions upon them.

In short, like NAFTA and CAFTA, it’s highly likely the TPP is not good for the world’s workers. But we keep swallowing the bill of goods supporters of these trade agreements give us about how it will help workers in the U.S. and abroad.

Bought and Sold by the Nail Salons

[ 16 ] November 15, 2015 |


You may remember the big New York Times nail salon labor expose of a few months ago that made a real difference in allowing these workers, primarily women with few English skills and often here without documentation, to have some semblance of dignity in their lives. Well, the nail salon owners know how to fight back. By buying off politicians:

In a packed hall in the Bronx a few months ago, Ron Kim, a New York State assemblyman, stood clutching a ceremonial pen in his left hand, the other extended into the crowd as labor advocates, politicians and immigrant rights workers thronged to shake it. Gov. Andrew M. Cuomo had just used the pen to sign into law a bill protecting nail salon workers from labor abuses and potentially dangerous chemicals. It was a measure that Mr. Kim, who represents the mostly Asian enclave of Flushing, Queens, had spent a painstaking summer helping to craft.

Less than a month later, however, Mr. Kim, a Democrat, began to publicly question the law — particularly a provision designed to protect workers from wage fraud. He soon became one of the statute’s most vociferous critics.

Other elected officials and civic groups have expressed concerns about the statute, which passed the State Legislature after The New York Times published a two-part series in May on abuses in the industry. They argued the law was discriminatory and overly burdensome on immigrant-run businesses, and contended it unfairly lumped responsible nail salon owners in with those who are mistreating workers.

But Mr. Kim came to play a critical role in the owners’ battle, helping them strategize and connecting them to a lobbying firm where he used to work. Among the firm’s first tasks was to help with public relations around a lawsuit filed by the owners challenging the legality of portions of the law.

There is clearly a political upside in the nail salon fight for Mr. Kim, who in interviews covered by the Korean-language press has alluded to his hope that the issue will help mobilize Asian-American voters and in that way strengthen his position in the Assembly. More tangibly, Mr. Kim’s campaign coffers are swelling.

Give the nail salon owners credit–they may be immigrants themselves but they rapidly learn the American way of fighting against pesky reformers. A big check will do it.

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