Talking about the Ted succession issue ...

I'll be talking about the Ted Kennedy succession and all the issues surrounding it on Monday night at 5:15 p.m. on Roots Up Radio, an online radio station. You can tune here to listen: ["Roots Up Radio"].

Sept. 2009 Top 30 Chart

Reporting: WAAF, WBCN, WBRS, WCUW, WFNX, WHRB, WMBR, WMFO, WRBB, WUML, WTCC, WZBC, WZLX

1. The Luxury - In The Wake Of What Won't Change
2. Dinosaur Jr. – Farm
3. Passion Pit – Manners
4. Taxpayer – Don’t Steal My Night Vision
5. Wheat – White Ink, Black Ink
6. 28 Degrees Taurus – Electricity from Post Midnight Thrills
7. Ian Adams – Stay Up Late
8. Big Big Bucks – Crucial Schmooze
9. Big D & The Kids Table – Fluent in Stroll
10. Bleu – A Watched Pot
11. Drug Rug – Paint the Fence Invisible
12. Me and Joan Collins – love trust faith lust
13. The New Collisions – The New Collisions
14. Casey Desmond – Chilly Allston EP
15. Cursillistas – Les Biches
16. Hallelujah the Hills – “Blank Passports”
17. Magic Magic – Magic Magic
18. Joe Pernice – It Feels So Good When I Stop
19. The Everyday Visuals – The Everyday Visuals
20. Sarah Borges and the Broken Singles – The Stars Are Out
21. Sarah Rabdau & Self Employed Assassins – Sarah Rabdau & Self Employed Assassins
22. Deer Tick – “Easy”
23. Apple Betty – Streakin’ Cross the Sky
24. Boy in Static – Candy Cigarette
25. The Bynars – Back From Outer Space
26. The Blizzard of 78 – Book of Lies
27. Have Nots – Serf City USA
28. The Steamy Bohemians – Technicolor Radio
29. Yes Giantess – “You Were Young”
30. Hot Box – Four Eyes

R.I.P. Ted K ...

We were all kinda wondering how bad the decline was. I guess it was bad: ["Sen. Ted Kennedy dead at 77"]. Seventy-seven years is a good run. I'm glad his family was close to him at the end.

Late night music notes ...

Earlier tonight, I finally put together the Noise chart for this month. And, by chance, while compiling all the airplay data, I stumbled across some interesting new music out of the New England area.
The first is the new Casey Desmond EP, "Chilly Allston," which is very nice combination of piano pop and studio tricks. Casey has a smooth voice not unlike a lot of girl stuff you're hearing today but with a bit of edge and indie cred. I think she is the daughter of the owner of Sound Museum, since her record is out on the rehearsal space's label and she has the last name. Either way, the record is really good pop.
The Steamy Bohemians are a duo who play comedy numbers with often sexual, spicy overtones. Sometimes they rip off a 1970s classic; other times they get into stuff you just don't want to hear about. But what comes across is highly original and enjoyable.
Disclaimer: Niki Luparelli once tried out to be the singer of a band I played guitar in but, for whatever reason, she didn't want the gig. She later turned up in this blues trio and now, this band. I guess, she had funnier things to do. Enjoy their video below:



Hot Box have a full-length coming out soon called "Four Eyes." They play introspective indie pop with jagged edges, odd time signatures, and flirty girl vocals. People will compare Amanda to Juliana Hatfield but she has a bit better homemade feel. It doesn't feel forced and the band balances out her vocal parts. Nice job!

Must see TV?

Yup, Jon Keller moderating the Boston Mayoral debate at 7 p.m. on Wednesday, Aug. 26, only on WBZ-TV 4. It should be hilarious.
Watch Tom "Mumbles" Menino fumble through the debate, pronouncing words you've never even heard of before.
See Sam Yoon, the darling of the Left, pontificate on how not living in Boston for more than a few years will make him a better mayor.
Check out Michael Flaherty's "awe-shucks-ma" Southie manner and wonder, if his folk's beach house in Plymouth is really propped up with contaminated cement, why isn't he glowing?
And then there is developer Kevin McCrea. Will he drive up on his Harley? Will he hold his own?
So much to ponder, so much savor. I can't believe Menino actually agreed to debate. Even though I don't live in Boston anymore, it should be a good show. Tune in tomorrow.

Progressives wallop Obama ...

Two columns worth a read from the left side of the spectrum:

First, there is this: ["The Worst and the Best Thing to Happen to the Democratic Party in Years"]. It's amazing, frankly, but not so, that we are reliving the debacle of the Clinton years all over again, while the corporate socialist state remains in America. What a nightmare!

And this: ["Guess What? He's a Terrible President"]. Yeah, that about sums it up. A terrible president and vacuous leader. But, in my mind, I have a clear head. I didn't vote for him and I knew it would be a disaster.

I do, however, worry about the younger generation and how much they threw into the process in 2008. If anything, we all need their energy and desire for a better place to live. America has always thrived and been able to count on young people. Whether it is fighting fascism in World War II, immigrating to and building the country, fighting for and receiving racial and gender rights, or challenging a corrupt political and military system in the 1960s (only to later cave in to that system), young people have played an integral role in the shaping of the nation. It would be a shame to abuse or misuse these folks when the system finally has them engaged.
Delusion and bitterness can be powerful enemies and both are likely to fester if real reforms don't start to take place. We should worry about the masses, many of whom have so much invested in this presidency. They were so easily manipulated before that they could be just as easily manipulated again, by even darker forces, sending the nation into a national socialist state not unlike Germany and Italy during the 1930s.
In many ways, the last few presidents, with the help of Congress and both political parties, laid the groundwork for this. We are currently in a corporate socialist state, as Ralph Nader has stated many times. The corporations rule and the individual pays. A few more tips at the scale and who knows ...

Glenn Currie nails it ...

I forgot to mention it on Sunday but Concord poet Glenn Currie really nailed it in a My Turn column in the Monitor on Sunday. For whatever reason, it isn't online, so I can't link it, but he basically states that despite what you see on television or read in the newspapers, there is real anger out there about the state of the nation.

"The story isn't the loudmouths or the kooks who grab the headlines. It is the under-current of growing dissatisfaction among a large number of average Americans, both Democrats and Republicans, who are fed up with what has been coming out of Washington"

Currie, who is a Republican, goes on to talk about the massive spending programs, the bailouts, and other economic catastrophes, and does so with such precision that I almost don't want to write about the subject anymore! Yeah, that's what I would have said.
Of course, I don't agree with Currie completely. I would tweak his positions a bit. But not by much. And I don't believe that gun owners or people who wear T-shirts quoting Jefferson are kooks. My friends may not like it or may not feel comfortable with folks being able to arm themselves or actually reading the Constitution, but that is the way it is.
But otherwise, a nice job indeed.

Update: The Monitor has posted Currie's column: ["Forget the kooks - there's real anger out there"].

Another thing worth reading, which I can link to, is this: ["Could a Third-Party Candidate Actually Win in 2012?"].
Frankly, I don't know if an indie would be able to win or not. With the way the ballot access laws are ... with the way the media is ... with what it takes to run a national campaign ... I just don't know. Having done this off-and-on during different times of my life I can tell you that it is nearly impossible to get on state ballots unless you are registered to one of the two major parties. And even then, you can be totally kept out of the debates. Look at what happened to Larry Agran in 1992 and Ron Paul in 2008. And in Paul's case, with millions of followers and tens of millions in donations, there was no reason for him to be kept out of debates ... but he was.
I will have to give this some more thought in the future.

'Save America'

Crossposted at OurConcord.com
A lone man was standing at the intersection of Main and Centre streets in Concord at 9:45 p.m. tonight holding a sign: "Save America" ... I would have stopped to talk to the guy, to find out what he was all about, but I was busy racing home to play Thomas trains with my eldest before he went to bed. Maybe tomorrow night.

Southwest: Please don't leave Manch

Margot Sanger-Katz has a pretty good piece in the Concord Monitor about Southwest's lease coming up in Manch and their new arrival to Logan: ["Southwest says it's committed to Manchester"].
I don't know what the airline has planned but I can say this, as a frequent flyer and Rapid Rewards member: Please Southwest, don't leave Manch! Add an extra fiver or 10-spot to flights if you need to in order to make it work. But not having to drive to Logan for flights is like a Godsend to us up here in New Hampshire. Really, it truly is.

Early riser club

There used to be a radio show on WMBR called "The Late Riser's Club" (it probably still exists today) that would play a mix of indie and hard rock, depending on the DJ. I used to listen to it on certain days because the DJs would play new stuff that I wasn't hearing otherwise (I think Tuesday was the day I would ignore it because the woman was always playing really bad metal).
This morning, as I got up at 6:35 a.m. to make coffee and flip through the newspaper, I got to thinking about what I have termed the Early riser club. Essentially, it's the opposite without the music. Although, it could have music, if I hit the WMP (I've just decided to play some Azure Ray).
The last few days, I have been getting up really early, without an alarm, quite naturally. And, there is nothing like the peace and quiet of the early morning. It's eerie in a way. The cats scooch me for food. I make coffee. I look out the window, in today's case, everything is green and soggy wet. I wonder about life for a few minutes and then I skim through the newspaper, write some bills, and keep chipping away at this pile of papers on the dining room table. It's uneventful but cherished time. Later this week, my eldest starts school. Where the hell is the time going?
This week is redesign week at work. The newspaper I edit will be laid out differently with new fonts and a modern, fresh look. I'm not as prepared as I would like to be but I am excited about the changes. I'm sure it will go fine. I do, however, wonder if it will make any difference. At an event last week, a number of people came up to us, thanked us for our work, and said they hoped we would still be in business in the future. It was like being in an ER, watching someone fade away and having everyone shake their heads! I kept telling people, "It's OK, we're not going anywhere any time soon, really ..." The newspaper I run is quite successful although not as good as the glory days. But how do you combat the mindtrip that some folks are on about the news business? I don' t know either. I guess I'll figure that one out later.
I shouldn't have put on Azure Ray. Melodic piano music in the morning might not have been the best choice ... Adam Ant, Annette Farrington, the Beach Boys, the Beatles, BMRC ... OK, Cheap Trick will do.

Between the Rhetoric and the Reality

Guest perspective by Ralph Nader
The Obama White House—full of supposedly smart political advisors led by the President of the “Change You Can Believe In” campaign movement of 2008—is in disarray. Worse, multiple, confusing varieties of disarray provoking public confusion, internal Democratic Party strife, and the slow withdrawal of belief in Mr. Obama by his strongest supporters around the country.

Two of his most steadfast supporters in the media—columnists Paul Krugman and Bob Herbert of the New York Times are wondering about Mr. Obama’s plans. Krugman repeated his fellow Sunday Times essayist Frank Rich’s observation who wrote about Obama “punking” his supporters with his waffling, reversals and frequent astonishing adoption of Bush’s worst corporatist and military policies.

While Bob Herbert, taking to task his political hero for waffling and vagueness regarding health care, issued this reluctant appraisal:

“I hear almost daily from men and women who voted enthusiastically for Mr. Obama but are feeling disappointed. They feel that the banks made out like bandits in the bailouts, and that the health care initiative could become a boondoggle. Their biggest worry is that Mr. Obama is soft, that he is unwilling or incapable of fighting hard enough to counter the forces responsible for the sorry state the country is in.”

There has rarely been a more auspicious time for a transforming Presidential leadership. Disgraced corporate capitalism has shattered the economy. The living conditions of millions of workers and pensioners whose taxes were taken to bail out these Wall Street crooks and gamblers are dismal.

Rather than expressing remorse, the arrogant corporate lobbyists are working over Congress with ferocious demands, fueled by cash-register politics and paid Astroturf rallies back in the Congressional Districts.

The giant corporations and their trade lobbies want no real health insurance reform that will reduce their monopolies and profiteering. They want no renewable and energy efficient standards interfering with their massive waste, pollution and inefficiency. They want no reductions in the bloated military budget surrounded by the waste, fraud and abuse of what President Eisenhower called the “military-industrial complex” in his farewell warning to the American people.

The corporate supremacists want no changes in the deliberately complex and obscure tax laws favoring the corporate evaders and avoiders and the tax havens for the super-wealthy.

In short, the global corporations want Washington, D.C.; to continue being their massive deregulator and cash cow perpetuating the abandoning of American workers, the pillaging of the American taxpayer and the defrauding of the American consumer.

Forget about corporate law and order to restrain the corporate crime wave. The harmony, bipartisan President Obama and his chief of staff, Rahm Emanuel, have outsmarted themselves. What worked to defeat Hillary Clinton last year has succeeded in splitting the Congressional Democrats into progressives, corporate liberals and Blue Dog Conservatives. Republicans can scarcely believe their luck and are busy exploiting these schisms.

Rep. Steny Hoyer, the number two House Democrat, undermines his Speaker, Nancy Pelosi’s “public option” plan for health insurance. Senator Max Baucus—a closet Republican masquerading as the Democratic Chair of the Senate Finance Committee, is working hand-in-glove with right-wing Republicans and the White House to craft a weak “bi-partisan” bill that keeps getting weaker as the corporatist Republicans sniff increasing weakness in the White House.

Meanwhile, in the House of Representatives, the more progressive legislators are accusing their former colleague, Committee Chair, Henry Waxman of selling out to the defiant Blue Dog Democrats on his Committee. While Mr. Waxman himself has to be worried that even his compromised “public option” (which Democrats should be calling “public choice”) will be derailed by the bill that the Baucus/Grassley/Obama axis will soon reveal in the Senate.

The Obama voters do not know what they are supposed to support. Obama never did identify with a clear health insurance proposal—not to mention the single payer approach (full Medicare for all) he says he would favor if he was “starting from scratch.” There has been nothing upstanding for his supporters around the country to rally around.

It is sad to say that all this could have been predicted by Obama’s political record as an Illinois and U.S. Senator. He rarely has taken a stand and fought against his adversaries. Even after he cuts a deal with them, they continue to undermine his agenda.

Once again, Bob Herbert senses the disturbing trend:

“More and more the president is being seen by his own supporters as someone who would like to please everybody, who is naïve about the prospects for bipartisanship, who believes that his strongest supporters will stay with him because they have nowhere else to go, and who will retreat whenever the Republicans and the corporate crowd come after him.”

Mr. Herbert can speak from authority. He has written many columns over the past 18 months reflecting that “nowhere else to go” attitude. If he is going off the bandwagon, more will follow. Mr. Obama better wake up and pay attention to his base before they either have somewhere else to go or simply stay home. It happened to Clinton in 1994.

The Kennedy succession request debacle

Everyone is abuzz about Mass. Sen. Ted Kennedy's request to have Gov. Deval Patrick appoint a successor in the wake of his passing [it is clear from the letter that the "liberal lion of the Senate" is not long for the world ...].
The request has sparked headlines across the nation and controversy in the state due to the fact that in 2004, Kennedy was involved in a successful effort to strip then-Gov. Mitt Romney, a Republican, from having the same right to appoint.
I wrote about the controversy back in 2004 when I was editor of The Winchester Star and took the position that, yeah, Democrats on Beacon Hill shouldn't change the law and Romney should be allowed to make the appointment: ["Let Mitt make Senate appointment"].
Here is the pertinent section, at the end of the column:

Actually, it is kind of amazing that the Democrats - the people who are always lecturing the rest of us about the hallowed nature of democracy, inclusion, diversity, and other worthy virtues - are doing everything they can to keep millions of residents from having their second voice in the Senate for more than five months. And the fact that they have set up a special election which will pretty much limit the candidates to the all-white, all-male, contributor-connected insiders is even worse.

Clearly, in the wake of a presidential victory by Kerry, the citizens of our state should not be without democratic representation just because partisans don't like that a Republican is making the appointment. Romney should be allowed to appoint a successor - it is the best thing for the people of Massachusetts.

In the end, Kerry lost the election that year and there was no need to worry about a, gasp, horrible Republican representing Massachusetts in the Senate.
Oh how things change.
More than five years later, an ailing Kennedy is on death's door and he is worried about the health care reform bill - his legacy at work - not being able to pass the 60 vote filibuster-proof threshold [if the seat is vacant, health care reform will only have 59 supporters]. It is doubtful that any of the Republican votes will change based on a phone call request from a dying Kennedy. In other words, the reform plan would be finished for this year in the wake of a vacancy.
There has been a lot of back and forth about the issue online with a lot of emotion. You have a dying but beloved senator, the worries and fears, pro and con, over the health care reform package, and the excitement and speculation of a future Senate race in Massachusetts where elections, especially bloody Democratic primaries, are a glorious spectacle. It is an emotional time in the state, indeed.
I think one of the best reports I have seen is one by Jon Keller last night at 11 p.m. on WBZ-TV 4 in Boston who stated that Kennedy had missed all but four of the last 151 roll call votes in the Senate during the last year: ["Spin-o-meter"]. Keller also has a blog post here about the situation: ["God Bless You, Ted...."]. Essentially, Massachusetts hasn't really been represented in the Senate, with all due respect to Ted. So, why the rush this time?
David Bernstein over at the Boston Phoenix has another pretty good take on the situation here: ["Theory: Lehigh Just Killed The Kennedy Plan"]. People might think this is wildly speculative but it is the Kennedys after all.

As we all know now, the law should not have been changed. Those of us who said so in 2004 were right then and have been proven right now. The Beacon Hill insiders and Democrats couldn't look beyond their own noses at what the future might hold. Now, the issue comes up again and the insider crowd wants it to be their way or the highway. It is not healthy for the laws to keep flipping around the way they are sometimes in the same way it is not healthy for the state to not have representation. In hindsight, Kennedy should have stepped down in 2006 and enjoyed his twilight years on his boat Mya instead of hanging on - to the detriment of his constituents. As Keller points out, the state has lived this long without his representation ...
As much as folks haven't been represented and can probably wait another five months, I really have to stand by my initial position. The safe thing to do would be to tweak the law, again, and allow the governor to make the appointment and then set a date for a special election to be held six months from the date of the resignation of the office holder.
It would also be good for Gov. Deval Patrick to appoint someone who might not be interested in running in the special election or makes a commitment not to run, similar to what Gov. John Lynch in New Hampshire tried to do when it looked like Sen. Judd Gregg would be taking a job in the Obama Administration. This would ensure that the state could have an open, honest, thoughtful primaries and elections with the stakeholders, the voters, deciding what is best for their futures.
[Disclosure: I was Sen. Kennedy's college coordinator in 1994, a paid position with the campaign.]

Update: Eric Fehrnstrom, the former Romney spokesperson, sounds off in this column on the Boston Herald Web site today: ["Kennedy late coming to succession principle"]. Note: Fehrnstrom is saying that it was nine of 270 roll call votes ... a much worse attendance record than most would expect.

More interesting newspaper news out of Claremont

According to the AP, the daily could be reopening with new ownership: ["2 suitors ready to bid on NH newspaper"].

Hippo moves into Claremont

File this under the entrepreneurial spirit section: According to a publisher's note in this week's edition of The Hippo, the parent company of the newspaper has started a new newspaper to serve Claremont and surrounding communities, in the wake of the demise of the Eagle Times: ["Newspaper adventure"].
The new newspaper is called The Compass. It started on July 23 and will start running weekly next week. Anyone interested in checking out some of the impressive samples, you can download them in PDF online: ["The Compass"].
This is the second or third newspaper company that has ventured into the murky newspaper waters of Claremont and vicinity. I believe the Valley News company said it was going to reach out to readers in the area, creating more content for them in its daily paper. Dan Kennedy also wrote about a former resident who was working on a Web-only news site for the area.
It's good to see some folks jump in to cover one of the state's smaller but more complicated cities. As I wrote here ["More newspaper problems in NH"], there are a lot of stories to be told in Claremont. There are even more in the surrounding area. In addition, it's a lot easier starting up a weekly than trying to make ends meet publishing a daily. Running a weekly can be done barebones [I know, I do it every day!] while using the power of the Web to present daily breaking news to the public. If you already have the infrastructure in place, like a printing press [or access to one, inexpensively], at least one decent sales person willing to work it, and an editor and reporter, to gather content, it isn't very hard to do. Throw in some submitted content to the mix, and you can make a go of it.
While the Hippo did abandon its Concord effort, the company's expansion is impressive, buying a depressed property in southern Maine and now, creating one for western New Hampshire, along with the Manch Express, Manch and Nashua versions of the Hippo, and its niche publications. While they probably aren't thinking about this, the next step would be for them to get their own printing press in order to shave off the cost of outsourcing the printing. Sure, there are other expenses to be had that might not make this such a good idea. But if you see all the things that are published on the Concord Monitor's printing presses, you'd understand my point. Who was it who said that the power of the press is available for those who own one?
Despite what the modernists say, print is not dead. It's just going through changes. And there is nothing like looking at a newspaper while it is in your hands! Here's hoping that the Hippo folks keep it going and best of luck to them and their ever-expanding newspaper empire.

Moonbat-nation-New Hampshire?

I'm beginning to wonder about my state, especially when I read things like this post: ["Swett Responds"]. It's one of the reasons I don't go to Blue New Hampshire anymore, despite the fact that I agree with a ton of public policy positions promoted by posters there.
This is the pertinent section:

Notice that no Republican leader, at the state or federal level, has condemned the violent and anti-American nature of the protests. None. Their silence is complicity. It means they are in agreement. It means they believe the lies and distortions being put forward by industry shills and radio/teevee demagogues. I remember all too well how anyone criticizing Bush for the least little thing, such as creating torture chambers, was branded a traitor and unpatriotic. Now people say Obama isn't a citizen, hold signs with him as Hitler (the ahistorical and ignorant nature of this is mind boggling), and that's somehow okay.

Wow.
First, there were plenty of Democrats and liberals holding violent signs and saying some pretty offensive things when Bush was president ... and in many cases, rightfully so. To get all huffy about it now when your person is in power is pretty silly.
Second, it would seem, according to the writer, that it is "anti-American" to assemble and protest in America if you are challenging the chosen one. One FreeStater legally wearing a handgun, visually seen by the police in the area, who were "keeping an eye on him" does not make an assassination attempt, coup, or anything else. You can do that in this state and many others ... The last time I looked, quoting Jefferson was not a crime. And if it ever becomes one, God help us all! One guy who forgot to leave his gun in the car getting busted doesn't make a coup either. And, yeah, he should be arrested because he wasn't following the law!
Frankly, it doesn't matter if the protesters are misinformed, spreading lies, or whether we agree with them or not. The first amendment protects this activity. It IS American! The country was founded on this principle of assembly!! To even suggest such things is just so lost it isn't even funny. Clearly, some writers just don't understand the concept of America and that is truly sad.
I don't know who Jennifer Daler is but she needs to 1) go back and read some American history, to educate herself on the founding of the country, and 2) get a grip, because so long as both sides of these arguments continue to play fast and loose with the truth, none of these damn problems are going to get solved.

Update: Oh my word, I just did a Google ... this woman is a member of the state Legislature!: ["Jennifer Daler"]. I can't believe this.

Oh this is funny ...

I've got facts on my side and you have Glenn Beck on your side ...



That's a great line. But the old lady kinda makes a good point. We shouldn't be paying for illegal aliens. And, not unlike everyone having to pay something in federal income taxes, so that they understand that they are paying income taxes, young people should be buying insurance too ... so that they understand the consequence of their actions. If they don't, they'll never get it.
As it is, too many people think everything is free - news is free, music is free, etc. Well, not everything is free. In fact, nothing is free. You gotta pay. So, the old lady is right in this regard.
Or, instead, we can scrap Obamacare and just go to single-payer, be taxed 10 percent like we do on SSI, tax sugar, fats, and ciggies more to offset the tax, put the insurance companies out of business and hope for the best.

So friggin' creepy ...

So, I went to the drug store today to get some allergy medication. I had a raincheck to get a buy one get one free deal. However, because it was over a significant amount of "drugs" - two 120 packs or about eight months worth - the store manager had to approve the sale. She was called to the front, walked over, and stuck her thumb on scanner that was attached to the register and it scanned her thumb print and the sale went through.
I stood there for a second, totally shocked.
"Does she have to do this with every drug sale?" I asked.
"Yup," the register clerk girl said, smiling nervously as I whispered "creepy," and walked away.
Imagine for a second that the store manager decided to leave the job or was fired. Do they delete her thumb print after she leaves or does it stay in the store's computer files? Do they delete others or keep them all on file? Imagine how many thumb prints the store chain has. Imagine if every store chain did this for a $33 allergy drug purchase.
Creepy. Creepy indeed.

Vanity Fair ...

I love that the Vanity Fair comes at the perfect time ... about a week after I'm done reading the last edition of Vanity Fair! Of late, it's a bathroom read ... only because I don't get much time to read outside of the bathroom and I only read stuff, for the most part, on the computer.

The man who predicted the economic collapse ...

is running for U.S. Senate in Connecticut ... against Chris Dodd!: ["Schiff for Senate"].

Obama and the insurance bosses

Guest perspective/Ralph Nader
Never much of a fighter against abusive corporate power, Barack Obama is making it increasingly clear that right from his start as President, he wanted health insurance reform that received the approval of the giant drug and health insurance industries.

Earlier this year he started inviting top bosses of these companies for intimate confabs in the White House. Business Week magazine, which proclaimed recently that “The Health Insurers Have Already Won” reported that the CEO of UnitedHealth, Stephen J. Hemsley, met with the President half a dozen times.

These are the vendors. They and their campaign slush funds cannot be ignored in the power struggle over the legislation percolating in the Congress. One public result of these meetings was that the drug industry promised $80 billion in savings over ten years and the health insurance moguls promised $150 billion over the same decade. Mr. Obama trumpeted these declarations without indicating how these savings would be guaranteed, how the drug companies could navigate the antitrust laws and what was given to the health care industry by the White House in return.

We have now learned that one Obama promise was to continue the prohibition on Uncle Sam from bargaining for volume discounts on drugs that you the taxpayer have been paying for in the drug benefit program enacted in 2003.

Unknown is whether the health insurance companies were also promised continuation of Medicare Advantage with its 14% added taxpayer subsidy to induce the elderly to make the move out of public Medicare. Also unknown is whether the Medicare public option that Mr. Obama formerly espoused but since has wavered on has been put on the concession table.

The whole secret process is seedy and demonstrates cruel disregard for the millions of American who, whether in dire need of medical services or not, voted in “change we can believe in.”

By stark contrast, President Obama has never invited to the White House the leading consumer-patient champions in this country who favor full Medicare and free choice of physician and hospital—often called “a single payer” system. Open to the corporate barons who have failed decade after decade to deliver what patients need, the White House door is closed to the likes of Dr. Quentin Young—a founder of the Physicians for a National Health Program and an old Chicago friend of Obama’s, Dr. Sidney Wolfe, who heads Public Citizen’s Health Research Group, Drs. Marcia Angell, Stephanie Woolhandler, and David Himmelstein, who are nationally known and accomplished single payer advocates or Rose Ann DeMoro, executive director of the fast-growing California Nurses Association.

Mr. Obama even tried to exclude any advocate of a single payer system—previously favored by Obama and still favored by a majority of the American people, doctors and nurses—from his roundtable meetings convened to receive the views of different constituencies.

“Make me do it” was the advice of Franklin Delano Roosevelt to reformers when faced with legislation he desired but did not have the votes for in Congress. Mr. Obama is not exerting that plea for people power. Were he to do that, he would be encouraging daily public hearings in the Senate and the House on the bureaucratic waste, greed, overbilling, collusion, and fraud that many in the corporate world have inflicted with their costly, pay or die health care industry.

Such publicized hearings would keep him on the offensive. It would arouse the public and focus energies on the main problem—the corporatization of medicine. This commercialism has left tens of millions of people without health insurance, caused 20,000 fatalities a year, and cost Americans twice or more per capita than have full Medicare systems in western countries, which have better health outcomes than the U.S.

Further indication of Obama’s corporate dealings is that he never identified himself with a specific bill with a House and Senate number that he could rally the people around. No wonder people are confused, frustrated and angry. President Obama did not stand for an unambiguous proposal.

He thereby emboldened both the cash and carry Blue dog Democrats to rebel and the Republican yahoos to launch their lies and distortions via Rush Limbaugh and similar trash media.

Obama is about to make his biggest mistake to date by favoring the bipartisan deal his assistants are working out with Blue Dog Senator Max Baucus and his Republican counterparts on the Senate Finance Committee. This proposal has no public option, no consumer protections or restraints on the mayhem and skyrocketing charges of the so-called health care industry.

Already the less corporate-indentured bills being reported from the House Committee by Rep. Henry Waxman (D-CA) and his allies are getting short-shrift from a White House that clearly views the forthcoming Baucus-Grassley “compromise” as the “more practical” go-to legislation.

There is reliable word that the AFL-CIO will endorse whatever Obama approves, with the exceptions of the California Nurses Association and the Sheet Metal Workers’ union. The latter, through their president, Michael J. Sullivan, announced in late July that it was suspending all future campaign contributions to any candidate for Congress or the Presidency.

Already over sixty progressive members of the House, headed by Congresswoman Lynn Woolsey (D-CA) have declared opposition to these unacceptable compromises moving forward in both the House and the Senate.

So is gridlock around the corner? Will there be a health insurance reform of any stripe signed into law this year? It depends on the alliances that settle for the lowest corporate denominators being blocked by the unyielding principled stands of the progressives who want something that puts patients above the failed profiteering vendors.

The guess here is that Obama will sign anything which squirms through a cowardly Congress that cannot give to the American people in 2009 the health care system Congress stopped President Harry Truman from establishing in 1950.

It is up to the people of our country to “make him do it” whether this year or next. A mere one million immediate calls to members of Congress by one million assertive citizens will start sobering up these legislators who think they can get away with another sale of our public trust.

The Congressional switchboard is 202-224-3121. The full Medicare, single payer bill (backed by nearly ninety legislators) is H.R. 676. The go-to citizen group for your sustained engagement is singlepayeraction.org. The rest is up to you, the majority, who want to put the people first.

Palin responds to 'death panels' ...

I may have to re-read the provision again because she lays it out here: [Palin on "Death Panels"].

And the Globe lands this, about the how the little girl who asked Obama the question in Portsmouth was actually the daughter of a woman who was a campaign supporter: ["Critics say White House set up Malden girl's query"]. Co-inky-dink? Yeah, right.

Umm, Sen. Shaheen, I'm not really happy seeing these videos ...

Wasted health care money?

CNNMoney.com has a pretty good overview here of how billions and billions could be saved in the health care industry: ["Health Care's Six Money-Wasting Problems"].
Note: Nothing about containing profits or regulating obese profits mind you, just the most obvious things ... Worth a read though. And for goodness sake, wash your friggin' hands all the time!

Tupelo Hall II?

Yup, that's right. In an email alert last week, the folks over at the Tupelo Music Hall announced that they are constructing another bigger location in Salisbury Beach, Mass.!

The music programming for this new venue will be similar to the Londonderry room. Because the capacity will be greater, however, I envision getting some big artists to play the new intimate space. The building is literally on the beach. You couldn’t ask for a better location. An adjacent restaurant will allow concertgoers to have a nice meal and then stroll across the lobby to the show.

This is very exciting. I don't necessarily know if I will be able to get over there for gigs very often but it is always good to have another location to see bands outside of Boston. As well, people forget that there are smaller, mid-range bands who need places to play [and crowds to play to] but might not be able to fit a 500 or 1,000 seat auditorium, never mind a 15,000 auditorium. As the economy gets weirder, there will be more and more opportunities for gigs like Tupelo gigs. Best of luck to them in the new endeavor!

Who is watchdog over the financial press?

Guest perspective by Ralph Nader
Companies that specialize in stock market forecasting and trading—such as Goldman Sachs, Citigroup, Morgan Stanley, and JPMorgan Chase—pay very high salaries to their employee-vendors. New York Attorney General Andrew Cuomo just released data showing that these and other large banks are giving each of their 5000 trader-forecasters bonuses of at least one million dollars. In return, these fat cats are very frequently wrong in their recommendations and decidedly unprofessional in their fiduciary relationships with the clueless, trusting clients who rely on them. Win or lose, they get their fees.

These firms and brokers are making money largely from other people’s money—pensions, savings and investments. Overall many produce little more than gambling tips. When these moneyboys try to justify their doings as providing liquidity, hedging against risk, assembling capital for productive investment, listeners are permitted to robustly laugh. This is especially so now during Wall Street’s massive, self-inflicted financial collapse. The economy, and taxpayers, are paying for this reckless speculation.

Meanwhile, outside this paper economy, people are producing for the real economy—manufacturing, repairing and maintaining products and structures, offering needed services for consumers. These people are far lower on the income ladder. Unlike their speculating counterparts, if the workers in the real economy stayed home, the economy would stop cold.

I was rummaging recently through some old publications and randomly came across the March 24, 2008 issue of Barron’s, a leading financial weekly. Its contributors and interviewees are supposed to be among the savviest around. Here are some samples of their perspicacity.

The cover story asserts that “the financial sector’s strongest players probably don’t have further to sink, even with the ongoing pressure of negative news. Stocks of the industry’s strongest players could climb by 10% to 20% over the next year as panic recedes, earnings improve and price-to-earnings multiples expand.”

The author, Jacqueline Doherty, got specific. She cited Merrill Lynch, Citigroup, Bank of America, Washington Mutual, among others, for the predicted upswing. At the time (March 24, 2008), Merrill stock was selling for $46.85. Before the year’s end, the stock was worthless and Merrill was swallowed by Bank of America. Washington Mutual, the nation’s largest savings bank, saw its stock, selling at $11.70, go to zero as it was absorbed by JPMorgan Chase in September 2008. Citigroup was selling at $22.50 per share. Now, it has climbed just above $3 per share, and Citigroup narrowly avoided bankruptcy due to a huge federal bailout.

Leafing through Barron’s pages of that week of March 24, 2008, I read a prediction by James Finucane—who is described as a "talented strategist"—that the Dow would reach 20,000 within a year. A year later in late March 2009, the Dow was below 8000. Even James Glassman, who loudly predicted in 1999 that the Dow would go to 36,000 by 2005, has been mercifully quiet.

Unlike sloppy plumbers and carpenters who pay a price for their mistakes, Wall Street forecasters seem to be paid very well despite being chronically wrong.

A few Barron’s pages later, columnist Eric J. Savitz was writing that worries about NVIDIA were overblown. The computer chip company stock having peaked in October 2007 at just under $40 a share, was selling for $18.52 when Mr. Savitz was touting its prospects. On August 4, 2009, NVIDIA closed at $13.37 per share.

And so it goes week after week in the financial world of pundits. Do you know of any other profession that can be so wrong so often and be rewarded so well again and again? On their behalf, they say that they cannot guarantee against risk and that they rely on cues from the watchdogs.

The first defense is unrebuttable because it shifts all risk away from the purportedly knowledgeable minds and onto market imponderables. Then why be so cocksure of what you urge investors to buy?

Second, they know that the watchdogs are paid to look the other way and let avarice and deception prevail. These “watchdogs” include the boards of directors, the large law firms, the major accounting firms, and the ratings companies like Moody’s and Standard and Poor’s.

Looking the other way also pays for most state and federal legislators and the regulators. The former solicit campaign contributions and the latter are looking forward to cushy positions in the industries they failed to regulate as government servants.

The forecasters’ excuse is that the watchdogs weren’t barking to alert them. Come on! These forecasters weren’t born yesterday.

Barron’s veteran columnist Alan Abelson is a sharp pen hedger who calls his weekly commentary “Up and Down Wall Street”. Abelson is a wry, irreverent free-thinker on the conservative side, but he sometimes offers useful insights. Maybe he can break his remaining taboo and apply his mordant, satirical style to review a year of Barron’s recommendations and see whether short sellers made more money than investors did who bought on the suspect advice.

It could be that the fog at Barron’s is lifting; it just recently offered a year’s subscription for $52, a sharp discount from its $260 yearly newsstand cost of $5 per copy. Now that’s a realistic price worth paying at least if you like comedic doses of illusion and the fullest stock tables on paper west of the Pecos.

Privatization run amuck?

Guest perspective by Ralph Nader
Every week, Marcia Carroll collects examples of privatization (that is, corporatization of the peoples’ assets). Looking at her website, privatizationwatch.org, will either make you laugh helplessly or make your blood boil.

The “off the wall” giveaways at bargain-basement prices of what you and other Americans own eclipses imagination. The latest escapes from responsible government are called “public-private partnerships” and are designed to enable the likes of Morgan Stanley and Goldman Sachs to take over highways, meter-collecting, and public buildings in deals that are loaded with complex tax advantages for the investors.

Here are two of her latest entries. Arizona lawmakers and Governor Jan Brewer are moving to fill a $3.4 billion budget shortfall by selling state-owned buildings. These include not only prisons, but also the House and Senate buildings. That’s the state legislature, fellow Americans! Metaphor becomes reality!

The proposed sale has bipartisan support and will require a leaseback by the buying corporation to the lawmakers with the right to repurchase the premises within twenty years.

The Arizona Republic reports that the deal, which includes 32 state properties, would bring in $735 million in upfront money and entail state lease payments totaling $60-70 million a year.

“We need the money,” State Minority Whip Linda Lopez, a Tuscon Democrat said, adding, “You’ve got to find it somewhere.” Well, why not rent out the backs of the state legislators to their favorite corporate funders? At least the public would get full disclosure of ownership.

“I look at it as taking out a mortgage,” practical Arizona House Majority Leader John McCormish, a Republican, told the Wall Street Journal.

The second item comes from the Denver Post, which reports that the foreign consortium, auto-estradas de Portugal (Brisa), operating the toll road Northwest Parkway under a 99-year lease, objected to improvements on a nearby public road. Under the complex leasing contract, the company could cite the improvements as an “adverse action” reducing toll revenue and the number of vehicles using the parkway. This action would presumably entitle this foreign company to compensation from Colorado taxpayers.

Last year, Pennsylvania Governor Ed Rendell tried to push through the legislature a complex, 75-year lease of the storied Pennsylvania Turnpike in exchange for $12.8 billion up front. All kinds of tax breaks and trap-door evasions filled the 686 page lease. The Governor was prepared, for example, to agree to pay the consortium of foreign investors if new safety measures or emergency vehicles entered the toll road and affected the flow of traffic. Fortunately, the legislature rebelled and blocked the deal.

The Indiana Toll Road was turned over to private companies in 2006. The 75-year lease was for $3.8 billion, which is a little more than the cost to repair the Woodrow Wilson bridge over the Potomac River between Virginia and Washington, DC.

Tolls on the Indiana Toll Road have already doubled and are expected to double again within ten years, according to the Dallas Morning News.

Last year, Mayor Richard Daley of Chicago privatized the city’s parking meters. Chicago’s inspector general concluded that the meters were worth nearly twice as much to the city as the $1.15 billion that the city received under an agreement rushed through the City Council with no civic input. A fourfold increase in meter rates this year has driven many motorists to residential neighborhoods in search of free parking spaces.

Indiana, a leader in outsourcing governmental functions to private corporations, gave the servicing of the state’s welfare program to IBM. According to the Indianapolis Star, error rates since corporatization have risen 17.5 percent last November and 21.4 percent in December.

The myth that corporatization is “better, faster, and cheaper” is falling apart. This year, the IRS announced that it will end the use of private tax collectors after consumer groups argued that taxpayers were subjected to immediate payment demands by private collectors while IRS employees would offer citizens an array of options to help pay their tax debt.

Then there are the corporatized water systems where the companies deliver poorer service at higher cost.

Since the 19th century, privatizing public functions has opened the doors to kickbacks, price fixing, and collusive bidding.

New depths of corruption were reached in Pennsylvania recently when two state judges pleaded guilty to taking bribes in return for sending youths to privately-owned jails.

After reading report after report about the vast, relentless waste, fraud, and abuse arising out of corporate contractors to the Pentagon in Iraq, why should readers be surprised at this domestic scene whereby taxpayers pay through the nose for corporations to govern them?

So, you’re not surprised. But are you indignant? Are you ready to make sure the politicians hear from you in no uncertain terms, hear from you to stop this recklessness and restore public control of the public infrastructure under accountable government?

If the state politicos try to pull a fast one, demand public hearings with thorough reviews of the proposed contracts or leasebacks. Better yet, in states like Arizona or Colorado, require any such proposals go through the open, state-wide referendum voting process.

Corporatizations such as the above just pass on to our children the burdens that our generation should have assumed itself to run government within its means funded by fair taxation.

Tuesday a.m. shortcuts: 'Audacity of Hype'

I woke up early this morning to try and get some work done [I'm behind on a couple of stories ...] and received an email alert that Jello Biafra, the former singer of the Dead Kennedys, has formed a new band and is working on a new album.
The band is called Jello Biafra and The Guantanamo School of Medicine. The album? "Audacity of Hype." Hilarious. Jello's MySpace site has two songs posted: [Jello Biafra and the GSM]. Rockin' tunes, targeted, timely lyrics. In other words, pure Jello. Bring it on!

Here is an update on the clunkers situation here: ["'Cash For Clunkers' Provides Boon To Salvage Yards"].
It looks like some of the spare parts are being used before meltdown, which is a good thing it would seem even though this program seems like nothing more than a multimillion subsidy for the auto industry.

The NBC show "Kings" had received a short revival on Saturday nights over the last two months but it looks like the program has been scrapped entirely. Creator Michael Green explained the situation in an online post last week: ["A note from Kings creator, Michael Green"].
Here is an interesting line in his letter about the benefit of tax breaks to keep the show's costs down:

"Some have speculated that the cost of the show was prohibitive. While it is true that the episode budget was high for a first season show, that number was reduced by the outstanding aggregate 30% tax benefit New York provided (which we all hope will remain in effect), thus bringing the cost down to rates comparable to other prime time dramas. And, of course, plans were already made to bring the costs down to whatever number the studio required of us in the future."

Another interesting note: On the day "Kings" was canceled, it was tops in downloads on iTunes. In the end it was nothing more than ratings that killed the show, he said.
According the Seattle Post-Intelligence, the series finale of "Kings" received a total of 1.81 million viewers, a 15 percent increase over the previous week. That's growth but not enough.
As noted by Green, the series also had many online viewers. But online viewers, not unlike online readers of news, don't pay the bills.
Television and the media in general are going through a difficult time right now. We all know that. And, it would seem, that any thinking drama which might go beyond the limits of a typical drama wouldn't work. In many ways, that was "Kings" ... it's Shakespearean in nature, the Middle Ages in modern day ... And that's probably why it went over everyone's head. What's so amazing to me, as a mid-40s white male who has no real interest in much of television these days is that when I finally find a show I enjoy, they go and cancel it. Oh well. I guess I know what a lot of older folks feel like right now!
Check out the archived episodes here: ["Full Episodes: Season 1"]. Viewing this amazing show is worth the time. The episodes will be up online until September.

Clunker question ...

Umm, where are all those "Cash for clunkers" going to go? If you have a clunker, and trade it in for a new car, the dealer is just going to re-sell it, right? So, the clunker is still on the road ... Or, does it get melted down? If it gets put in the junkyard, it could be a bigger environmental disaster than just driving the thing, right? Inquiring minds want to know ...
In addition, are people really saving anything on the new cars? If you have a clunker and they have marked up the MSRP with a ADM - or additional dealer markup - then you really don't save anything, it's just another auto dealer scam.
I remember the AutoFair Hyundai in Manch trying to pull that on buyers back in June 2007, tacking on another $1,500 on top of the MSRP of an Accent that was overpriced to begin with. After telling the sales rep. that I wasn't going to buy that day, I was just looking around, he called over his manager for a high pressure close ... I remember his words to this day: "How much am I going to have to lose to get your business today ..." Oh, this isn't a good sign, I thought. After toying with him - "OK, I'll give your $3,000 for it ..." They looked at me like I had three heads. See ya, wouldn't want to be ya ...
If you have a clunker and you're thinking about getting something new, don't fall for the MSRP or ADM crap. Go to www.edmunds.com, get the invoice price of the car you want, go into the dealer with your trade, ask for the invoice price and the clunker money. You will then get a good deal and a new car. Good luck!

Getting to the heart of the economic collapse ...

As pontificators know, it is easy to have an opinion. It is not so easy, however, to have a supposedly educated or even commonsense opinion. That takes a little more effort.
I have had some conversations during the last year or so about the state of the economy and what brought us here. These conversations have been interesting, to say the least. But these are important conversations to have while acknowledging as many of the facts as one can, to the best of our abilities. It is also important to lay blame where blame is due, and not just use our own built in prejudices and political party influence to pigeonhole selected blame.
The economy didn't just collapse because Congress forced banks to lend money to poor or minority folks. The economy didn't just collapse because of the Iraqi invasion or the sustained campaign in Afghanistan, or even the debt incurred by both. The economy didn't just collapse because Bush rolled back taxes on the rich and it won't continue to collapse because Obama and the Democrats will let those tax breaks expire. The economy didn't just collapse because of Bill Clinton's policies either.
It's easy to get caught up in the name-calling because it distracts us from the larger, bigger problems, or the collection of problems, since virtually everything is connected. Blaming poor folks, blacks and Hispanics, liberals, warmongers, and tax cheats is a distraction. It is also hilarious to think that three million mortgages worth a few hundred billion dollars are being blamed for $9 trillion in economic losses that really didn't exist in the first place. These were all smaller symptoms of a larger, longer lingering sickness based on how we treat each other versus how we all live. All kinds of things like greed, fraudulent monetary policy, people who scammed other people, and people who desired better lives and would do just about anything to attain those lives, have all played a role.
It is also important to realize that the economy didn't just crash overnight, even though some folks think it did. As I have said previously, it wasn't just Sept. 15, 2008, that made the economy collapse. It wasn't the entire summer of 2008 or the spring of 2008 either. The economy started sliding way before that for most folks and a lot of us thought the economy would crash years before it actually did, and some of us even wrote about it.
In addition, despite what everyone says, it wasn't BearStearns that started the economic collapse either [Again, read this Vanity Fair piece from a few months back to learn that 1) BearStearns was solvent the week before its collapse, with billions in cash on hand, and 2) was probably brought down by a derivatives speculator betting against the financial powerhouse: "Bringing Down Bear Stearns"].

So what really caused the problems and why did the educated and enlightened - the ones we consistently rely on to guide the nation - not see the collapse coming? I can't say for sure. But here is what I can say. I think that most folks are totally missing the boat when it comes to why this all collectively happened. Obviously, there are many factors. Some are mentioned above. There was the speculative nature of Wall Street or the fact that the Street's police, the SEC, believed the criminals, the speculators, when they were told that things were safe and sound. At the same time, Americans were tempted - even brainwashed, if you consider the bombardment of Ditech ads before the collapse - into making very dangerous financial decisions based on attaining - or holding onto - a certain lifestyle. They were encouraged - or in some cases, literally forced - to put money into Wall Street when they probably had no business being there [if you're in your 40s, ask your parents about the pensions they used to have with their employers instead of the volatile and bankrupt 401k system we're expected to invest in ...]. People purchased homes they couldn't afford with dangerous mortgages and now, the frugal and non-risk-takers are expected to pay to fix everything, as always.
All these combined things played a role. But, as you will see in the data below, the Federal Reserve had a bigger role in the collapse of all of them and no one seems to be calling them on it. In fact, most media outlets are totally looking the other way on the role of the Fed. Politicians clearly are ignoring the problem, including how much power is yielded by the Fed to control monetary policy. Most of us saw the telltale signs on the wall as far back as late 2005, when the Fed started raising interest rates. This chart from MoneyCafe.com gives you a visual idea of what happened:



As this chart shows, for many years, the Fed rate for money was virtually nothing - 1 percent - which allowed banks to get money to lend at very low rates [Admittedly, the thrifty didn't get much bang for their bucks sitting in safe savings accounts or certificates of deposit]. The rate was slowly lowered during the first term of the Bush Administration to get economic growth kicking after the dot-con boom and bust, with the hopes that cheap money would bring our country out of the Clinton recession [Democrats hate this but it is true. The country was in recession in 2000 and it was Clinton's recession. Although, admittedly, Congress - controlled by Republicans under Clinton and Bush, and controlled by Democrats in 2007 and 2008. The larger point is that both major political parties had their hands in the collapse].
After 9-11, the rate continued to drop even more to get the economy pumping after the devastating terrorist attacks on our country's financial and military headquarters, the World Trade Center and the Pentagon. We all clearly remember, don't we, the lack of jobs, the drop in marketing and advertising, the massive layoffs, as companies freaked out over the attacks? It wasn't as worse as today ... but not by much.
The drop in the Fed rate worked - it created growth - but unfortunately, the growth was not sustained or controlled growth - it was fast, speculative growth based around a lot of debt because the money was so cheap. It was basically a very big sugar high. And since Americans weren't actually making much money to begin with there was little real wealth creation for the average American, as statistics have shown. The top 10 percent grew; the bottom 90 percent floundered. And what "wealth" creation there was, was mostly paper - stock market holdings, real estate holdings, etc. - based on the assumption that someone would buy something for a presumed value, or higher value, not an actual value.
This is why the housing boom really kicked in. A developer could take a plot of land, worth basically nothing, and build something on it that was worth something to sell to someone else. If that person bought the house and then someone else was willing to pay more, the value would increase even if it really didn't. It is the same concept as manufacturing, back when we used to manufacture things in this country. Take a tree, for example. A tree has environmental value because it takes CO2 and turns it into oxygen. We need it to breath. But beyond that, it's a tree. It has little economic value. If you cut the tree down though, you can make a table, a chair, fire wood and kindling, toothpicks, paper, whatever, and then sell those items. The sale of those items - nothing to something - creates wealth for the entity that cut down the tree and made the products.

Short sidebar: This is where the horrific state of trade policy kicks in. If you cut the tree down in America and make the items to sell in America, the wealth creation stays in America. If you cut the tree down, ship it overseas, allow the foreigners to make the product, and then bring the product back to sell, the wealth creation stays overseas. All we got was the price of the raw materials and, in fact, the country lost because money circulated here went over there. Throw in the fact that the experts say that two-thirds of the American economy is based on retail spending and you can see where this would become a problem. I have written a lot about this in the past already.

Back to the housing boom and subsequent bust. There wasn't much else to put the money into but there was plenty of land to sell and plenty of people to build homes. In fact, there is a gold rush of land to build on. Even though many of our centers are populated, many hundreds of millions of acres are not. And any developer could grab a section of land and start building a community. There were even plenty of people to buy homes and populate these communities, if the rates were right and the down payments low. Remember, depending on the price, it almost costs as much to rent as it does to buy [not figuring in property taxes, which, again, rose substantially as government grew along with the economy]. Why wouldn't you want to own a home? It's the American dream.
So things were churning along until the summer of 2004, when the Fed started slowly kicking the rate up again on some perceived notion that there was inflation even though inflation was non-existent. In 2003, the annual inflation rate was 2.3 percent, according to the Bureau of Labor Statistics, which is quite measly when you think about it [There is a perceived 3 percent inflation rate which is considered normal]. By the end of 2004, the annual rate was 2.7 percent. Again, relatively normal. In May 2004, the inflation rate was 3.05 percent. It would go up in June but drop in July, August, and September. And yet the Fed would raise the rate to 1.25 percent on July 1, 2004, 1.5 percent on Sept. 1, 2004, and 1.75 percent on Oct. 1, 2004 - while the inflation rate was dropping! By the end of 2004, the rate was up to 2 percent and inflation had risen from 2.5 percent in September to 3.26 percent in December 2004. The Fed raising rates had the exact opposite affect the experts said it would have.
At the same time, the increase in the Fed rate started to hit consumers.
People who had credit cards and were using the credit to buy things like computers, HDTVs, and other items were getting nailed as the rate for the debt went up. Most people don't read the back of the statements that note that the rate of the credit card is based on X amount percent over the prime rate. Say the card is 9 percent over the prime rate and the prime is 1 percent. Then the percentage on your purchases is 10 percent. But if the prime rate is 5 percent, you're paying 14 percent, or literally 50 percent more on products than you would have if the prime rate was 1 percent. Add in the fact that many people live paycheck to paycheck and must use credit cards and revolving unsecured debt to make ends meet and you have a serious problem.
People also purchased homes with adjustable rate mortgages and saw their rates rise, which made their mortgages more expensive since their rates were based on a markup of Fed rate. For example, if your ARM mortgage was 7 percent and based on the prime rate, each time the Fed raised the rate, the bank would raise the rate, and then the mortgage company that lent the homeowner the ARM would also raise the rate. Most people, so eager to become homeowners, didn't read the fine print and didn't realize the rates could rise, not unlike consumer debt. The difference is that consumer debt might only be $10,000 or $20,000 ... but housing debt is 15 or 20 times that! At 1 or 2 percent, this wasn't a huge problem. But during the next two years, the Fed raised the rate even higher and the collapse would come.
The rate reached a peak of 5.25 percent in July 2006 and remained there until September 2007. For more than a year, the rate that money was lent out at by the Fed was more than five times what it was just a couple of years before. This created an atmosphere where money was more expensive than before.
Think about that for a second: Money was being lent out at five times what it was being lent out in previous years. Of course there was a credit crunch. Americans could afford the lifestyle at 1 percent being marked up but not 5-plus percent! In many ways, the raising of the rates which was done to curb non-existent inflation CAUSED inflation and subsequently, the economic crisis. Between 2004 and 2005, the annual inflation rose from 2.7 percent to 3.4 percent. It was as high as 4.7 percent in September 2005. The next year, it went down slightly, to 3.2 percent, but was still higher than previous years when the rate was lower and within the year, there were monthly spikes as high as 4.3 percent in June 2006.
Even though the inflation rate continued to drop, the Fed kept the rate at 5.25 percent. The Fed should have seen the economic slowdowns and tempered the rate accordingly. But it didn't. It kept the rate artificially high, strangling credit markets, consumer debt, and ARMs until October 2007, which the rate dropped to 4.75 percent.

Some of us speculated that the economy was going to crash because we saw economic indicators that were worrisome. I wrote about it in August 2007: ["Is an economic collapse coming?"]. I saw some of the potential effects of the collapse much earlier, when I started reading the WSJ in 2005 and started seriously looking at some of the numbers.
Some people, like Peter Schiff, were literally laughed at when they told people on television the collapse was coming back in August 2006: ["Peter Schiff was right ..."].
I mean, we didn't know there was going to be a collapse. We were guessing. But, it was a pretty accurate guess, wasn't it?

Back to trade policy for a second: This all doesn't address a large component of the problem - globalization, trade policy, and the free trade cultists stranglehold on the debate - and the effects those things have had on the American family. That is a bigger mess that is an underlying contributor to the reason why Americans cannot keep up with the lifestyles they would like to have, the debt they hold, the hours they work, and in some ways, the media they consume. I've often wondered how many people would still subscribe to a daily newspaper if they could afford it and had the time to read it instead of always running around at 110 miles per hour. Trade policy and globalization have had a major role in the decline of economic growth in the United States during the last 30 years, while poverty, desperation, and revolution remain in other countries that have benefitted from the transfer of wealth from America.

What is the solution or what are the solutions? To be honest, I don't know. I have some ideas and tinkering isn't one of them. Sweeping reforms, competent regulation, open and honest government, thorough oversight, are just a few things that should but will never get done. In many ways, the American people were hopeful, almost too hopeful, that Obama would sweep in and fix these things. The Obama administration has made some things better but some things worse while other, extremely important things languish. In addition, many of the same people who caused the problems, or at least had a role in causing the problems, are in the White House today, influencing public policy.