Archive for Corruption

Apr
14

Incentives for the perverse

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Not all political deflections are bright and shiny. Hyperventilating over public aid to those at the bottom of the wealth curve is an oldie but goody. Is Wall Street defrauding the planet to the tune of trillions? Well, but LOOK! Over there. A poor person. Eating!

Properly incentivizing the poor is a perennial handwringer for Fox News and other watchdogs of personal morality on the right (who otherwise think the government should mind its own damned business). Nicholas Kristof, however, spares some column inches this morning on the incentives driving our beleaguered corporate persons at the top. He gets downright snarky about it:

A study to be released Thursday says that for each dollar America’s 50 biggest companies paid in federal taxes between 2008 and 2014, they received $27 back in federal loans, loan guarantees and bailouts.

Goodness! What will that do to their character? Won’t that sap their initiative?

The study in question comes from Oxfam. The group finds:

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Mar
05

Strip mining the human landscape

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350px-Chino_copper_mineDylan Ratigan’s August 2011 on-camera meltdown is as close as reality has ever come to Howard Beale’s Network rant remembered in Digby’s sidebar.

What made it a powerful moment was he was right:

Tens of trillions of dollars are being extracted from the United States of America. Democrats aren’t doing it, republicans aren’t doing it, an entire integrated system, banking, trade and taxation, created by both parties over a period of two decades is at work on our entire country right now.

Elias Isquith at Salon this morning interviews Les Leopold, Labor Institute executive director and president, about his new book “Runaway Inequality: An Activist’s Guide to Economic Justice.” Ratigan called what is happening “being extracted.” Leopold calls it “financial strip mining,” and a far cry from what free marketeers and neoliberals taught would happen from lower taxes and fewer regulations:
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Warren (2)Massachusetts Sen. Elizabeth Warren brushed off liberal efforts last year to get her to run for president in 2016. It is not hard to guess why. For one, she is smart enough to know that at this point she lacks the depth — especially in foreign policy — to do the job well. (After a quarter century in Congress, Bernie Sanders struggled with foreign policy in the Democratic debate last night.) Second, if she stays in the Senate, Warren can be a thorn in the side of all the right people as an advocate for working Americans for a couple of decades. It’s what she does. She’s very good at it. And it’s fun watching Elizabeth Warren do what she is so good at.

In an interview with The Nation, Warren spoke again about the “rigged game” in Washington. In particular, the bipartisan effort to reform sentencing laws that some Republicans are using the bill as a means of protecting corporate criminals from even the nearly nonexistent prosecutions to which they are now exposed. On the floor of the Senate, Warren said,

[F]or these Republicans, the price of helping out people unjustly locked up in jail for years will be to make it even harder to lock up a white-collar criminal for even a single day. That is shameful, shameful. It’s shameful because we’re already way too easy on corporate lawbreakers.

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Categories : Corruption, Justice, National
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Feb
04

Elizabeth Warren: Two Legal Systems

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Thank you. Thank you.

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Jan
18

A moral and financial black hole

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Not all drugs have to be injected, ingested or inhaled. Yesterday, I drew parallels between the man-made crisis on Wall Street and the man-made water crisis in Flint Michigan. The reason is that the amoral pursuit of personal gain is an addiction that goes far beyond Wall Street. The Big Short made a big impression, can you tell?

The Guardian’s Tim Adams spoke with “The Big Short” author Michael Lewis about the film’s protagonists:

The idea that the madness was going to get worse did not occur to him. “In fact, it got worse and worse to the point where people were paid unbelievable fortunes just to do stupid things with money. Even the movie can’t really get this across. The movie gets across that there was a bet and these smart guys were on the right side of the bet. And those smart guys made hundreds of millions of dollars. That inevitably leaves you thinking that the people on the other side of the bet lost. Of course, the banks went down. But the real story is the actual people on the other side of the bet also got very rich despite the banks collapsing. If no matter what side of the bet you are on things are still going to work out for you, the world is upside down.”

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Jan
17

Ben, I just want to say one word to you. Water.

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Detroit Water & Sewerage Water Treatment Plant

The United States used to be the subject of Michael Moore documentaries. Now we are living in one. Moore was in his home town of Flint, Michigan yesterday to protest the contamination of the city’s water with lead:

FLINT, MI — Filmmaker Michael Moore accused Gov. Rick Snyder of poisoning Flint water in a rally here today, Jan. 16, and called again for the U.S. attorney general to investigate the governor for what he called crimes against the city.

“I am standing in the middle of a crime scene …,” Moore said. “Ten people have been killed … because of a decision to save money.”

Yesterday, President Barack Obama declared a federal emergency in Flint, freeing federal dollars to help “save lives and to protect property and public health and safety, and to lessen or avert the threat of a catastrophe in Genesee County.”

There is a long backstory to this situation. Wouldn’t you know, as Moore said, it involves the Midas Cult and money.

“A manmade catastrophe”

Before the credits roll for The Big Short, the screen goes black and a series of “where are they now” statements about the protagonists appears as an epilogue, including this one:

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Jan
01

First admitting there is a problem

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Nancy LeTourneau at Political Animal wrote yesterday about the crisis of confidence in the American system of justice, one that seems organized around denying and covering up its own corruption:

I’ve heard some comparisons lately to another recent movie – Spotlight – about the journalists who were responsible for uncovering Boston’s sex abuse scandal in the Catholic Church. The parallel that has been drawn is about the lengths the journalists at the Boston Globe had to go to in order to get the Church (and community) to admit that it had a problem. Simple proof wasn’t enough. The evidence had to be overwhelmingly conclusive. In the process, the Church invited it’s own crisis of confidence.

LeTourneau was dead on with her comparison of the Catholic church’s denial of its sex abuse problem and the police failure “to correct mistakes and hold members of that system accountable.” The company line among police is, at best, that bad actors within the ranks represent just a few “bad apples.” Police departments should remember the last part of that proverb is something about spoiling the whole bunch.

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Categories : Corruption, Justice
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Nov
02

“Privatization of the justice system”

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Just yesterday I was wondering what ever happened to “frivolous lawsuits” and the runaway juries Big Bidness and Republican lawmakers used to cite as reasons to push for tort reform. It seems Republicans couldn’t deliver. Big Bidness went to Plan B: circumventing the courts entirely. The New York Times brings us up to date:

Over the last 10 years, thousands of businesses across the country — from big corporations to storefront shops — have used arbitration to create an alternate system of justice. There, rules tend to favor businesses, and judges and juries have been replaced by arbitrators who commonly consider the companies their clients, The Times found.

The change has been swift and virtually unnoticed, even though it has meant that tens of millions of Americans have lost a fundamental right: their day in court.

“This amounts to the whole-scale privatization of the justice system,” said Myriam Gilles, a law professor at the Benjamin N. Cardozo School of Law. “Americans are actively being deprived of their rights.”

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Oct
19

“The high cost of being labeled a sissy”

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Absolutely fascinating article by Malcolm Gladwell in New Yorker on the etiology of school shootings. They have become a ritualized behavior independent of the pathologies of individual perpetrators, he believes.

School shootings are not simply the isolated acts of a string of copycat psychotics who hear voices in their heads. They are perhaps a kind of slow-motion riot in which perpetrators downstream participate because they’ve been given a kind of permission by those who came before them. Four decades ago, Stanford sociologist Mark Granovetter posited that riots develop in this way.

Citing sociologist Ralph Larkin, Gladwell asserts that Columbine’s Eric Harris (“a classic psychopath”) and Dylan Klebold “laid down the ‘cultural script’ for the next generation of shooters.” Gladwell introduces us to a foiled 2014 plot by a seventeen year-old Minnesotan from a loving family. He wasn’t
“someone who had been brutally abused by the world or someone who imagined that the world brutally abused him or someone who wanted to brutally abuse the world himself.” Unlike Harris, psychological testing revealed this kid “wasn’t violent or mentally ill,” but “simply a little off.” Plus, he thought Harris was “cool.” The account reads like a scene from Fargo.

Gladwell explains Granovetter’s theory:

In his view, a riot was not a collection of individuals, each of whom arrived independently at the decision to break windows. A riot was a social process, in which people did things in reaction to and in combination with those around them. Social processes are driven by our thresholds—which he defined as the number of people who need to be doing some activity before we agree to join them. In the elegant theoretical model Granovetter proposed, riots were started by people with a threshold of zero—instigators willing to throw a rock through a window at the slightest provocation. Then comes the person who will throw a rock if someone else goes first. He has a threshold of one. Next in is the person with the threshold of two. His qualms are overcome when he sees the instigator and the instigator’s accomplice. Next to him is someone with a threshold of three, who would never break windows and loot stores unless there were three people right in front of him who were already doing that—and so on up to the hundredth person, a righteous upstanding citizen who nonetheless could set his beliefs aside and grab a camera from the broken window of the electronics store if everyone around him was grabbing cameras from the electronics store.

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Jul
02

Another day, another boondoggle

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Stick a fork in it. Another of those public-private partnership deals is done. Investors are ready to bail:

Barely 10 years after paying the city $1.83 billion for the right to run the Chicago Skyway for 99 years, a Spanish-Australian group of investors has put the historic tollroad concession deal up for sale.

The Skyway concession company’s executives have informed Mayor Rahm Emanuel’s administration they’re trying to sell their interest in running and collecting tolls from the 7.8-mile-long road on Chicago’s South Side, city officials said Monday.

And right on schedule, too. I described how these go down in December:

US and state taxpayers are left paying off billions in debt to bondholders who have received amazing returns on their money, as much as 13 per cent, as virtually all – if not all – of these private P3 toll operators go bankrupt within 15 years of what is usually a five-plus decade contract.

A “staggering” number go bankrupt, Salzman continues.

Of course, no executive comes forward and says, “We’re planning to go bankrupt,” but an analysis of the data is shocking. There do not appear to be any American private toll firms still in operation under the same management 15 years after construction closed. The original toll firms seem consistently to have gone bankrupt or “zeroed their assets” and walked away, leaving taxpayers a highway now needing repair and having to pay off the bonds and absorb the loans and the depreciation.

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