Puget Sound Liberals Weekly Newsletter #174

Enhancing Freedom, Opportunity and Cooperation in Puget Sound and Beyond

Through informing and networking Liberals and Liberal Organizations.

 

Our vision is hundreds of thousands of well-informed Puget Sound Liberals working together.

 

          3000 members                               May 15, 2009                    formerly Lake Hills Liberals                

 

 

 

 

                                                     

Our Website                                   Our  Editor                  To Unsubscribe

 

              Table of Contents  * Featured Articles

 

About Puget Sound Liberals

Calendars of Events

Communication with Our Members

Opportunities

Petitions

 

Commentaries from Our Members

Rich Austin: Health Care Reform Is Rigged

John de Graaf: Bill to Require Vacation Time*

Bob Olson: Banks Must Assume Responsibility

Donald A. Smith: Corruption is the Problem

Bert Sacks: Crime to Participate in War of Aggression

 

Liberals and Democrats Links to the Beef

Government Watch*

 

State and Local Links to the Beef

How Does Washington State Rank?*

Federal Aid is Major Increasing Revenue Source

KC Democrats Are Reaching Out to New Members

Featured Advocacy Group: Poverty Action Network*

Electronic Records Increase Patient Safety*

 

Nation and World Links to the Beef

Understanding Stress Tests*

Can We Only Bail Out the Good Guys? *

Tax the Rich to Increase Revenue by $450 Billion/Year

Dollar Value Decreasing.  Oil Prices Increasing.

United States Elected to the U.N. Human Rights Council

Our Liberal Spirit

Could We All Be OK? *

 

Recommended Books

 

 

 

Our Political Values

 

Our Political Priorities

 

·       Fair Clean Elections and Open Government

·       Fair Taxes and Competent Spending

·       Investment for Productivity

·       Quality Health, Education, Jobs, Income

·       Environmental Protection and Energy Independence

·       Security and Equal Rights

·       Justice and Peace Everywhere

·       International Cooperation and Leadership

 

Conservatives oppose all of these

 

     Let’s End Our National Nightmare

 

         Let’s Restore Our American Dream

 

More on Conservative opposition to our American Dream

 

Washington State’s 5 Major Needs

·       Federal Funding for Health and Education

·       Stop Corporate Abuse

·       Public Campaign Financing

·       Substitute a Progressive Income Tax

·       Replacing Conservative Legislators

 

Quote of the Week

I’m OK.  You’re OK.  Thomas A. Harris

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Calendar of Events

Schedule for Organizing for America Listening Tours:

 

Kennewick

5/16/2009

12:00:00 PM

Kennewick Library

1620 S Union St

Bremerton

5/17/2009

12:00:00 PM

Machinists Hall

822 Park Ave

Bainbridge Island 

5/19/2009

6:00:00 PM

Community Center

4779 Lynnwood Center Rd NE

Ellensburg

5/26/2009

6:00:00 PM

Central Washington Univ Student Union Bldg.

400 E University Way

Bellevue

5/31/2009

6:00:00 PM

Bellevue Library

1111 111th Ave NE

Seattle

6/1/2009

6:00:00 PM

Seattle Labor Temple

2800 1st Ave

Sequim

6/2/2009

6:30:00 PM

Sequim Library

630 N. Sequim Ave

Everett

6/3/2009

6:00:00 PM

Everett Labor Temple

2812 Lombard Ave

Spokane

6/4/2009

6:00:00 PM

East Central Community Center

500 S Stone St

Bellingham

6/6/2009

12:00:00 PM

Whatcom Educational Credit Union

600 E Holly St

 

Saturday, May 16 at 12 Noon at Town Hall Seattle (8th Avenue and Seneca Street, Seattle) – Winning Health Care for All, Representative Jim McDermott and Ron Reagan. $5.

Saturday, May 16 at 6:30 PM at Candy Sullivan’s and Jule Sugarman’s home (1140 Alki Avenue SW #505, Seattle) – inSPIRe Potluck and discussion of the Pros and Cons of Nuclear Energy.

Wednesday, May 20 at 7 PM at Swedish Providence Campus (17th and East Cherry Entrance, SeattleProgram Meeting of PNHP-WW (Planning a Single-Payer presence on May 30th)

Thursday, May 21 at 12 Noon across the street from the Bell Harbor International Conference Center (2211 Alaskan Way, Pier 66, Seattle) – Rally in support of strong EPA action on global warming, sponsored by Union of Concerned Scientists.

Friday, May 29 at 6:30 at King County Library Services Center (960 Newport Way NW, Issaquah) – Eastside Movies that Matter: Capitalism Hits the Fan followed by discussion

Saturday, May 30 at 12:30 PM at Pratt Park (20th Avenue South and East Yesler, Seattle) – Rally and March for "Health Care for All in 2009"

Monday, June 1 at 7 PM at Fauntleroy Community Church (9140 California Avenue SW, Seattle) –  King County Executive Candidate Forum, sponsored by inSPIRe.

Tuesday, June 2 at 5:30 at Café Racer (5828 Roosevelt Way NE, Seattle) – Incumbent Seattle Councilman Nick Licata Campaign Gathering

Saturday, June 6 at 6:30 at Nordic Heritage Museum (3014 NW 67th Street, Seattle) – Progressive Majority Fifth Annual Casino Night Fundraiser.  $50 - $500.  To register.

Saturday, June 13 at 6 PM at South Seattle Community Center Brockey Center ( ) – 3rd Annual Washington Public Campaigns Awards Banquet.  Reception, Dinner, Auction, Program keynoted by Congressman Jim McDermott. 

 

 

 

Calendars of Events                             

 

King County Democrats - LD Meetings            Some 2008 Legislature Lobby Days

Thurston County Progressive Net                  Western Washington Fellowship of Reconciliation

Alliance for Democracy                                Democratic Underground.Com                           

Sierra Club Cascade Chapter Calendar           Cool State Washington

Washington Public Campaigns Calendar          Town Hall Seattle Calendar

Washington State Labor Council                    Whatcom County Peace and Justice Calendar 

Conversation Cafe      Drinking Liberally          Seattle NOW          

Wallingford Neighbors for Peace and Justice – Friday Night Movies      Liberal films on PBS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Communication with Our Members

 

To select the links and write the commentaries which appear in this newsletter, I scan or read each week hundreds of emails, daily, weekly or monthly publications and books, plus a few websites such as Bloomberg.com and Daily Kos.  At least five for each one I use here. 

 

I am an information processor.  I try to find information concerning important topics, which not widely available.  Or detailed information concerning topics that are generally only discussed superficially.  I try to avoid just repeating information that is widely available.

 

Topics which I currently find particularly interesting include our economic collapse and attempts by the Obama administration to reform our economic system.  Also the changing political scene, with Democrats becoming more powerful while the Republicans are continuing their decline.  And other topics relevant to the priorities that appear on the right column of the first page of every newsletter.  My major question is whether we will be able to curb the excessive influence that corporations wield through their campaign contributions and lobbyists.

 

The emails that I receive from members are particularly passionate concerning:

·       Identifying and punishing those who have violated our constitution, particularly by torturing.

·       Eliminating our military presence in Iraq and Afghanistan.

·       Single payer public health insurance or at least such an option.

I believe that all three may happen, although not quickly.  Dave Thomas

 

Opportunities and Petitions

Useful Websites: contacts, maps, community organizing tools, and more.

Access to jillions of political cartoons.

Download Sightline Institute’s climate policy primer ‘Cap and Trade 101’.  About Sightline.

Create your own petition.

Conduct your own home energy audit.

See all of President Obama’s weekly (Saturday) addresses.

Listen to Pete Seeger singing and hear about his history of political singing (video).  For more.  I have a autographed Pete Seeger songbook that I got in 1945 when I listened to him sing in a Boulder, CO union hall.   Dave Thomas

 

Petitions

Tell Attorney General Eric Holder to appoint a special prosecutor to investigate Bush Era torture.

Tell BLM to stop oil shale development on public lands.

Tell EPA Administrator Lisa Jackson to regulate greenhouse gases.

Tell Forest Service keep Sweetwater Valley road closed to protect grizzly bears.

Tell Bank of America to stop funding coal fired electricity generating plants.

Indicate your support for President Obama’s 3 health care reform principles.

Tell President Obama to release the torture photos.

 

Commentaries From Our Members

 

Rich Austin: Health Care Reform is Rigged

 

Dear brothers and sisters, this is the kind of under-handed, b.s. "health reform hearings" that are taking place.  It should be noted that Sen. Baucus (D-MT) is a favorite son of the medical-industry complex.  Over a span of five years they tossed $1 million his way. 

 

Take a look at the cast of characters (aka witnesses).  Only one person from labor (Stern) was in attendance, but he sure as hell didn't speak for the overwhelming majority of union people - and the public - who support single-payer!  Hell, he didn't even mention single-payer.  Folks, the game is rigged.  Labor needs strong, effective, unwavering spokespeople at Congressional hearings.  Pie card apologists do us a terrible disservice!  Rich Austin

 

John de Graaf: Bill to Require Vacation Time

 

Dear friends and colleagues, I have some terrific news to share with you!!!   At 11 am, Thursday, May 21st on the Cannon House Office Building Terrace, Congressman Alan Grayson of Florida will introduce the first paid vacation bill in US history at a press conference.  I will be with the Congressman as he announces the legislation.  The basic points of the bill and arguments in favor are included below my email in an email from Congressman Grayson's staff.  As you will see, this is a very modest bill, but as a friend who is a US Senate staffer told me, it's a "down payment" for future improvements. 

 

TAKE BACK YOUR TIME hopes that all individuals and organizations that care about the quality of life of working people will endorse this legislation.  We hope that it will be strengthened in committee and in the Senate, but we are grateful that Congressman Grayson is, by this bill, bringing America's lack of vacation time to public attention and beginning, however modestly, to address it.  I hope you will add your support for this bill and will assist me in reaching out to other organizations.   

 

We would love to have any of you join us at the introduction press conference for this groundbreaking and historic occasion.  I am very excited about this--it is the culmination of hard work by many people!  I have made it clear that our support for this bill is contingent on its not being viewed as a possible substitute for the Healthy Families Act, which we firmly believe should be passed first.  The vacation time in this bill will be IN ADDITION TO any sick leave currently granted by companies or mandated by the Healthy Families Act when it passes.

 

Please let me know if you can help and feel free to call me at 206 407-5490 for any further information.  Additionally, we will be addressing this bill at our Seattle Vacation Matters Summit in August and Congressman Grayson hopes to join us there.  I hope that many of you can make this first-ever conference and be part of the history we are trying to make.  All the best, John de Graaf, Executive Director, Right2Vacation.org

 

Donald A. Smith: Corruption, Not Taxation is the Problem

Published by the Bellevue Reporter on 5/13/2009

 

In his May 6 letter Chris Neibauer nailed the problem on the head when he complained of "our tax dollars being thrown down the drain by corrupt politicians."  So why didn't the tea party organizers protest against corruption instead of protesting against taxation? The reason is clear: protesting against taxation meshes with the anti-government ideology prevalent among conservatives.

 

Neibauer says he's "all for paying taxes to benefit the country, as anyone with half a brain is." But millions of Americans oppose government and consider taxation to be theft, even when it's used to fund necessary and worthwhile programs such as national defense, veterans' care, the FBI, debt reduction, regulatory agencies, and the Centers for Disease Control and Prevention.

 

During the Bush years, Republicans intentionally mismanaged government and ran up the deficit, in an effort to "drown government in a bathtub" and destroy peoples' faith in the possibility of good government.  Now we must fix government and we must raise taxes on the well-to-do, who have seen their share of wealth increase dramatically and who enjoy unjustly low rates of taxation, especially in states like Washington with a regressive tax system.

 

Government is indeed out of control, because powerful special interests hijack it. But the answer isn't Reagan's (minimize government). The answer is: have public financing of elections so that politicians aren't beholden to special interests.  Donald A. Smith

 

Bert Sacks: A Crime to Participate in War of Aggression

Published by Seattle PI on 5/8/2009

 

It is hard to imagine an issue more central to the future of our country than this: Will we uphold the rule of law, or simply say we do and then act however we wish?  Lt. Ehren Watada refused deployment to Iraq for one reason: He claimed the war was illegal ["Feds drop appeal of Watada decision," page one, May 7].

 

U.S. Army Field Manual (27-10, Section 498) says, any person "who commits an act which constitutes a crime ... [is] liable to punishment ... [including] a crime against the peace." A crime against the peace is the crime of engaging in a war of aggression.  To follow the rule of law and the Army Field Manual, the court-martial of Lt. Ehren Watada had to confront the question: Was the U.S. war in Iraq a war of aggression -- not of self-defense? This is the question the military judge refused to allow, disregarding his own military laws.

 

As one law professor put it: "[Lt. Watada] is being ordered to do something that he has every reason to believe ... is implicating him in the gravest crime against peace imaginable. And if he has no chance to even raise that issue before this military tribunal, then it's such a blatant denial of justice as to itself constitute a kind of crime because he's being criminally disallowed from obeying the law. Franz Kafka didn't have such a macabre imagination."

 

Perhaps George Orwell had a better imagination. I hope we'll choose not to live in that world.  Bert Sacks

 

Liberals and Democrats

 

Government Watch

 

Less Bully Pulpit

During the first 100 days of his presidency, Barack Obama was everywhere in the public eye: press conferences, town meetings, so-called summits with political and economic leaders concerning various economic reforms, weekly addresses, and appearances on television shows.  His message was that our economy has collapsed; his stimulus-investment package and other measures would restore the economy, but not quickly; and that we should support his programs while remaining patient for results.  His use of the bully pulpit was successful.

 

These past several weeks, President Obama has been much less in the public eye.  A fun exception was his appearance before the White House Press Association.   He also met Health Care Insurers and providers who pledged to reduce increased health care costs.  He praised companies which encourage employee health.  More on health care reform.  He asked his cabinet to find ways to cut expenditures.  In his weekly address, Obama called for congress to address credit card abuse.

 

Government Department Actions

Most of the political action is occurring in various government agencies and Congress.  Many of President Bush’s actions to let corporations override our environmental laws have been reversed.  Our EPA and FDA are taking on new responsibilities for regulating and enforcing environmental and consumer protection.  FDA says Cheerios can’t be marketed as a drug.  Our Justice Department is increasing its willingness and resources to investigate and pursue anti-trust and fraud violations.  For more.  Our Housing and Urban Development and Transportation Departments are increasing the coordination of their activities.  Our State Department is enhancing its diplomatic and development capacity.  Similar actions are occurring in other Departments.  Tax reductions are being distributed and infrastructure investment projects are beginning.  Our Military is adopting a new counterinsurgency strategy for Iraq.

 

In the aftermath of the stress tests, fewer unpopular bailouts are anticipated.  Bankruptcy will resolve the fates of Chrysler and General Motors.  The number of troops in Iraq is being reduced.  Comprehensive strategies are being developed and applied for Afghanistan and Pakistan.  The Obama administration is insisting on an Israel and Palestine two-state solution. 

 

Environmental, Health Care and Educational Reform

Having passed the 2010 budget resolution, Congress is moving rapidly on health care, with some form of public health coverage an option.  Greenhouse gas cap and trade legislation is being prepared with credits being given free during our recession and then auctioned off.  House climate bill may pass soon.   For more.  For more.  Our Education Department is promoting reforms and providing 100 billion in stimulus-investment funds to assist local schools.

 

Not Yet

Various issues are being delayed while emphasis is upon dealing with our recession.  No immigration reform bill is being introduced; but Homeland Security is scaling back its raids upon employers of undocumented immigrants and deportation of those found.  No attempts are anticipated to legalize drugs, but the federal government is allowing states and cities to quit punishing drug users.  As states are increasing civil rights for GLBT people, our Federal government is even waiting to eliminate ‘Don’t Ask. Don’t Tell.’

 

Our Obama Administration is not mounting a frontal assault on K Street lobbyists.  But it is proposing a variety of measures to eliminate corporate tax loopholes and other corporate abuses.  The lobbyists are being forced to defend their corporations from so many actions, that they will certainly lose many struggles.  Similarly, a frontal assault is not being mounted on our military-industrial and agro-business and other subsidies and contracts.  But after recovery occurs, we expect government to seek major savings there to reduce our deficits.  When digitized medical records, preventive medicine and changed incentives for providers to keep or make people well instead of simply being paid for their procedures fail to control health costs, we can expect more attention to be given to end-of-life treatment costs and to eliminating costly private insurance coverage.  Dave Thomas

 

Here’s the Beef

Technology helped elect Barack Obama.  So did art.

The Wilderness Society describes and evaluates President Obama’s environmental actions.

There is an ideological battle over who wrecked our economy.

Arlen Specter may be unable to win Pennsylvania’s Democratic Primary.

12 Democratic Senators cave in to Wall Street (or were bought off).

Why didn’t Obama Administration give more support to Cramdown bill?

Some good news about student loans and health care costs.

Unregulated agriculture is perhaps our most polluting industry.

New York State government will quit purchasing bottled water.

A deal concerning the energy and climate reform bill may be close.

An update on the Employee Free Choice Act.

Obama Administration supports inclusion of public health coverage option in health reform legislation.

Senate Finance Committee is including public health coverage option in health reform legislation.

Not clear whether members of New Democratic Coalition (including Adam Smith, Brian Baird and Rick Larsen) will support public health coverage option.  For more.

Republicans don’t have a workable strategy to defeat health care reform.

Robert Reich: Report that Social Security is financially unsustainable is wrong.

Obama is seeking tax reforms to increase revenues by taxing financiers.

Many more cuts to our military spending are needed.

Non religious believers are increasing.  Will they become politically powerful?

Republicans referring to ‘Democrat Socialist Party’ may make socialism a more popular term.

 

State and Local

 

How Does Washington State Rank?

 

I once attempted without success to find how Washington compares with other states concerning our environment, health, education, work, retirement, incarceration, housing, transportation and other services and outcomes.  Now I have found such information through googling such phrases as Washington environment ranking, Washington health ranking, etc.  Here is some of the information that I found.

·       Statistical Abstract: http://www.census.gov/compendia/statab/rankings.html

·       Environment: http://www.forbes.com/2007/10/16/environment-energy-vermont-biz-beltway-cx_bw_mm_1017greenstates_2.html

·       Health: http://www.whf.org/spotlights/Healthiest-State-Report-Card-2008.aspx

·       Education: http://www.alec.org/am/pdf/education/2008_report_card/washington08.pdf

·       Education: http://www.lrc.ky.gov/lrcpubs/RR345.pdf

·       Incarceration: http://www.everychildmatters.org/homelandinsecurity/table-11.html

·       Housing: http://www.ors2.state.sc.us/abstract/chapter1/staterank7.php

·       business: http://www.cnbc.com/id/25501971/

·       Income and taxes: http://retirementliving.com/tax_burden_2008.pdf

·       For a critique of business climate rankings.

·       Washington welfare recipients increase 18%.

·       Also see the trends identified by Sightline Institute’s scorecard.

 

These rankings are based on information from a year or more ago.  So they don’t portray the results of our recent legislative session’s budget or future effects.   We can expect that both Washington and other states are being negatively affected by budget crunches.  Washington generally ranks in the middle or slightly above.  Instead of summarizing rankings concerning each aspect of our state, I will let you go to the websites above to easily view the rankings that interest you.  Dave Thomas

 

Federal Aid Is Major Increasing Revenue Source for States this Quarter

by Dennis Cauchon | USA TODAY

 

In a historic first, Uncle Sam has supplanted sales, property and income taxes as the biggest source of additional revenue for state and local governments.

 

Top revenue sources for state and local governments in the first quarter, compared with the same period last year:

Federal grants: +15%

Income taxes: -11%

Property taxes: +2%

Sales taxes: -2%

Other taxes: +2%

Sources: U.S. Department of Commerce, Bureau of Economic Analysis

 

King County Democrats Are Reaching Out to New Members

 

The King County Democrats Organization uses its resources to reach to new and long-time Democrats and keep them  involved:

·       Creating a Multicultural Networking Committee to enhance the community outreach effort.

·       Participating in festivals and fairs across the county

·       Sponsoring candidate forums as a public service

·       Conducting free training for Precinct Committee Officers (PCOs) and creating a new PCO

·       Creating a technology team that has designed and developed precinct maps and election history

·       Creating and supporting a Legislative Action Committee  that works with the Democratic Legislators  and brings the message across the county with monthly meetings

·       Coordinators committee comprised of Membership/PCO Chairs in all 17 legislative districts

·       Providing a great website that is a resource for news and events around the county

·       Providing office space, telephones, and other resources to local candidates and the coordinated campaign

 

Featured Advocacy Group ----- Poverty Action Network -------------------------

 

In a year with few victories, Statewide Poverty Action Network helped restore voting rights and win critical consumer protections. 

Voting Rights Restoration (HB 1517) - because no one should be denied the right to vote because they have a low income, this crucial bill restores the right to vote to people with felony convictions after they serve their time to the state.

Restricting Collections Tactics (SB 5164) - a common sense bill that restricts the collections practices of payday lenders and check cashers to prohibit harassment, intimidation and more.

Enforcing consumer protections (SB 5531) - raises the allowable damage level for consumer protection cases from $10,000 to $25,000, ensuring that more attorneys can afford to fight for Washington consumers.

Preventing reverse mortgage scams (HB 1311) - increases regulation of reverse mortgages and strengthens disclosure standards, preventing seniors from falling prey to reverse mortgage scammers.

Health care for children (HB 2128) - keeps health insurance eligibility at 250% of the federal poverty level (FPL) and leverages federal money for the program. Expands and improves outreach, enrollment and renewal efforts.

 

Read more about Poverty Action's priorities this session.  

 

Final budget will cost families with low incomes

 

Facing a record deficit, the Legislature approved a final budget that makes drastic cuts to the programs that many families depend on to meet their basic needs. There were a few bright spots in this generally devastating budget, but overall, the final budget undercuts important investments.

Building Assets
Individual Development Accounts (IDAs), a state-matched savings account program that helps people with low incomes save to purchase or build assets like a home, an education or a business. No new funding was added to this program. 

Assuring Dignity for All People
General Assistance-Unemployable (GA-U), a program that provides small monthly cash grants and medical coverage for disabled adults that are unable to work. Funding reduced by $65million - maintains cash grant funding, reduces slots.

Housing Security
Housing Trust Fund, the main source of funding for affordable housing in our state, makes it possible for people to afford housing and still have enough money for basics like food and gas. Funding was cut by 50% to $100 million.

Transitional Housing Operational and Rent Program (THOR), short-term rental assistance and services for homeless and at-risk families and individuals. Funding reduced by $1.5million, keeping program whole, but eliminating much-needed expansion.

 Access to Health Care
Basic Health Plan, health coverage to individuals under 200% FPL, serving about 100,000 individuals and families with low incomes in our state. This program was reduced by 40,000 slots and will leave many without coverage for prescriptions and preventative care.

Adult Day Health, skilled nursing and rehabilitative therapy for frail seniors and adults with medical or disabling conditions. Funding for this program was cut by 70%.

 

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Electronic Records Increase Patient Safety

Published by Business Week on 5/18/2009

 

While the issues and risked described are real, we at Seattle Children’s Hospital have made strides in patient safety that would not have been possible without our electronic health records. These include reductions in mortality, in bloodstream infections, in time elapsed from order to medication administration, and in pharmacy-ordering errors.  We’ve also made much greater use of evidence-based treatments, decreasing the use of unwarranted therapies in specific populations. 

 

None of these changes were attainable with our old paper-based record system.  Mark Del Beccaro, Chief Medical Information Officer, Seattle Children’s Hospital

 

Group Health Cooperative of Puget Sound also uses an electronic health record system, which enables all providers to coordinate their actions.  Dave Thomas

 

Here’s the Beef

Washington governor and legislature failed to fulfill their responsibilities.

Washington State Labor Council criticizes 2009 legislature.

Without tax reform, Washington State’s budget problems will outlast recession.

To maintain services, 16 States have raised taxes and 17 more are considering it.

$26.6 million stimulus money funds dredging the Columbia River to enhance shipping.

Carbon emissions requirements stops proposed Kalama coal fired generation plant.

As demand for lumber and timber has dropped, publicly funded tree thinning provides jobs for loggers.

Local food production helped by contract processing facilities.

Which of our Washington congress members support creation of a commission to investigate torture?

 

Nation and World  

 

Understanding Stress Tests

 

Financial companies are pass-through systems.  They receive money from various parties, such as stockholders, depositors and lenders; thereby incurring various financial obligations to these parties.  They then provide the money to other parties; that become financially obligated to them.  If the various parties (to whom a financial company provides money) become unable to meet their obligations, the financial company may fail (be unable to meet its obligations to the parties that provided them money. 

 

Two questions arise.  If a financial company fails, who gets hurt?  The stress tests that were conducted of the 19 large financial companies don’t address this problem.  They simply assume that the harm is serious enough that we must know the risk under various economic conditions and what private and public measures are necessary to prevent failure. 

 

For each of the 19 financial companies, the stress tests analyzed the risk that various parties which are obligated to pay them may be unable to do so.  Estimated possible losses from these sources are added to provide a total amount.  The following results are only for the 4 companies with the largest estimated losses.

______________________________________________________________

Estimates of 2009-2010 Losses ($ billions) for More Adverse Scenario

 

                                            Total*  BofA        Citi    JPMC  Wells 

First Lien Mortgages               102.3    22.1    15.3    18.8    32.4

Trading & Counterparty             99.3     24.1    22.4    16.7     -na-

Credit Card Loans                     82.4     19.1    19.9    21.2      6.1

Second/Junior Lien Mortgages    83.2     21.4    12.2    20.1    14.7

Commercial & Industrial Loans    60.1     15.7      8.9    10.3      9.0

Commercial Real Estate Loans    53.0       9.4      2.7      3.7      8.4

Securities                                 35.2    8.5      2.9      1.2      4.2

Other                                          83.7     16.4    20.4      5.3    11.3

TOTAL                                  599.2   136.6  104.7    97.4    86.1

 

* Total of all 19 bank holding companies         Source (Table 3)

 

Notice that the largest losses for the 4 largest losers are from mortgages (first and second/junior lien).  Bank of America, Citigroup and JP Morgan have large estimated credit card losses.  Then comes commercial and industrial loans.  Commercial real estate loans are significant sources of loss for  Bank of America and Wells Fargo.  

 

I don’t know what trading and counterpart, and other consist of.  Perhaps some of these consist of several financial companies trading assets and obligations to rearrange their bookkeeping to show them in a more favorable light.

 

Along with existing capital and expected income, these losses are used to calculate how much additional capital may be needed.  For a critique of the assumed risks.  For a critique of the leverage that would be allowed.  For a Dean Baker critique.  For Robert Kuttner’s reaction.  Joe Stiglitz says things may not get much worse, but not get much better either.

 

For an overview of the stress test report.   For more.  More1.  More2.  More3.  More4.  More5.  More6. 

Dave Thomas

 

Can We Only Bail Out the Good Guys?

 

Suppose that for each financial company, we could determine which other financial entities they are obligated to that would be hurt if they failed.  Suppose for each of these second level companies, we could do the same thing.  Until we had traced the impact of a company failing to the end financial entities which have no specific obligations to others. 

 

Suppose we could classify these end users as good or bad.  For example, charity and university endowment funds, pension funds and 401(k)s good.  Financial companies which pay their proceeds to management and wealthy speculators bad.  Then we could only bail out the good guys and let the others fail.  Unfortunately deciding who is good and bad would be the largest political fight in history.  Aren’t unwary investors who invested in Ponzi schemes or our reputable companies that secretly took enormous risks responsible for their ignorance. 

 

How could we every have financial markets if some who made stupid decisions get bailed out, but others don’t?  It is easy to understand the fierce reaction from any attempt by the government to decide good guys who should bailed out and bad guys who shouldn’t.  The government is supposed to decide who gets bailed out solely on the impact on our economy (and perhaps more narrowly on the availability of credit.  Dave Thomas

 

Tax the Rich to Increase Revenue by $450 Billion/Year

From Reversing the Tax Shift

 

Our federal government, since the turn of the century, has squandered hundreds of billions of borrowed dollars on tax cuts for the wealthy and militarized solutions to global problems. It has given massive bailouts for the Wall Street investment firms that created the current economic crisis.

 

Obama, with his stimulus plan, is proposing to invest hundreds of billions of dollars in the overdue investments on public infrastructure, energy, education, and health care that our nation's future demands. We cannot just borrow to pay for these investments. We also need to tax—the top.

 

The following seven proposals would do just that and, in the process, raise over $450 billion a year and over $3 trillion over the next five years:

1.   Repeal tax breaks for households with annual incomes over $250,000: $43 billion per year.

2.   Tax financial transactions: $100 billion per year.

3.   Eliminate the tax preference for capital gains and dividends: $80 billion per year.

4.   Levy a progressive estate tax on large fortunes: $40-60 billion per year.

5.   Establish a new higher tax rate on extremely high incomes: $60-70 billion

6.   End overseas tax havens: $100 billion per year.

7.   Eliminate subsidies for excessive executive compensation: $18 billion per year.

 

Dollar Value Decreasing.  Oil Prices Increasing.

 

We are borrowing more money to pay for our federal deficits.  The value of our dollar is declining compared to the Euro.  The price of oil in American dollars is increasing.

 

 After we and other countries recover, our increased economic activity will create more demand for oil, pushing oil prices up.  This may be less if less oil is used, due to conservation and use of alternative energies.  As deficits decline, the dollar will gain value, pushing oil prices down.  With all these factors, it is difficult to predict oil prices.  Except that as production falls, prices will increase.

 

United States Elected to the U.N. Human Rights Council

Citizens for Global Solutions celebrates the election of the United States to a seat on the United Nations Human Rights Council.  The United States won by a wide margin, another sign that the country is reclaiming its role as a global champion of human rights.

"The United States was founded on the principles of human rights and freedom, and we helped create the United Nations in order to spread those ideas around the world," said Don Kraus, CEO of Global Solutions. "Taking a seat on the Human Rights Council is the next step in reclaiming our rightful place as a beacon of fairness and justice in the world."

 

Here’s the Beef

A brief history of this credit crisis and responses to it.

Americans lost their retirement savings, partly due to wrong Washington Post commentaries.

During recession, Social Security and Medicare are providing a floor for retired.

Government paid much too much for common shares of Citigroup.

Americans need a new vision, with less emphasis upon financial success.

Out of work with time on your hands.  Become an advocate for reform.

Businesses fail to pay several million employees what they are owed.

Some people who lose their homes are able to buy them back at lower cost and better mortgage.

We may love our mom’s, but we don’t mandate that they have time off work after childbirth.

Our children don’t just receive our debts.  They receive our infrastructure and economy.

State public health insurance plans are models for national public health reform.

Unnoticed, inhabitants of islands overwhelmed by higher waters have left.

Prodded by Biden and Kerry, American Jewish lobby may accept two-state Israel-Palestine solution.

Israel has long obtained benefits through occupying Palestine and maintaining a strong military.

 

Our Liberal Spirit

 

Could We All Be OK?

 

Last week, I imagined that our super Obama administration had within 4 years reformed our economic system to provide much increased freedoms and opportunities for all, including infrastructure to improve productivity, earnings commensurate with productivity, and a safety net for those of us limited in our productivity.  Last week, I also discussed the personal mindset which would enable us to utilize our freedoms and opportunities and appreciate the resulting benefits, in spite of success or failure.  An “I’m OK.” mindset. 

 

At least one more factor is relevant to our experiencing benefits from our freedoms and opportunities.  It concerns how we treat one another.  Whether we respect, trust and cooperate or engage in friendly competition with others, or engage in unfriendly competition and conflict.  Or act in isolation.

 

Cooperation generally assists productivity.  Competition may assist productivity when it stimulates innovation.  Competition may harm productivity when it primarily concerns the division of spoils.  Coercion and conflict generally harms productivity.  America is a land of diversity.  To cooperate, we must respect and trust people who are different than ourselves.   A “You’re OK.” mindset.

 

Beginning with early childhood, parents and other caretakers should be role models and teachers of tolerance, respect, trust and cooperation.  These should also be stimulated by schools, churches, workplaces, voluntary organizations, communities, and our society. 

 

I believe that Liberals support all three of these factors: a society which offers freedoms and opportunities to all, a mindset that enables us individually to use these freedoms and opportunities and appreciate their benefits, and a cultural mindset which enables us to cooperate. 

 

I believe that Conservatives oppose all three of these factors.  They oppose public investments to improve our infrastructure and safety net.  They tend to play God (thinking they understand and can control everything) or play Victim (often of our less fortunate and Liberal do-gooders who enable them.  They accept abuse, coercion and conflict and promote unfriendly competition.  Dave Thomas

 

Recommended Books – See our list of books for liberals

 

Evan Thomas, 2009, A Long Time Coming. The Inspiring Combative 2008 Campaign and Historic Election of Barack Obama

 

Chuck Todd, 2009, How Barack Obama Won.  A State Guide to the Historic 2008 Presidential Election

 

Evan Thomas describes Barack Obama’s excellent management of his campaign by contrast with the mismanagement by Hillary Clinton and John McCain of their campaigns.  We can be glad that Obama won, since Clinton and McCain could not have managed a comprehensive response to our economic collapse and other issues as Obama has.

 

Chuck Todd describes in detail the demographics of each of our states and how the various demographic groups voted to give victory to one or the other of the candidates.

 

 

 

 

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