This is insane. The strength of the U.S. rests on its scientific and technological superiority, which is directly linked to government support of basic research.
As research funds stagnate, science in state of 'crisis'
When a home is sold under foreclosure, the lender usually winds up buying it for the mortgage balance. If the value of the home exceeds the debt, the lender can sell it at a profit, but when the housing market is down, the lender must sell at a loss, that is, if it can find a buyer. As every JP reader knows, investors in mortgages and securities based on mortgages have seen their investments lose much of their value in the last six months. Since most of these investors are either very wealthy individuals or institutions with political clout, Congress is struggling to find ways to keep them solvent.
There is also some talk of helping homeowners threatened by foreclosure.
This crisis was predictable long ago. So was the Savings & Loan Crisis, the Dot Com Crisis, the stock market collapse, and the Asian meltdown. The problem each time was that no one who was able was willing to put a damper on what anyone with a grain of sense could see was a bubble — Congress, the Federal Reserve, the Treasury Department, the SEC, or even the mainstream media. Mainstream economists are just now noticing the problem, it appears. Dean Baker, of the Center for Economic and Policy Research, goes beyond sarcasm in criticizing an article in the Washington Post:
The [Washington] Post bizarrely describes a scenario in which Greenspan "puzzled over one piece of data a Fed employee showed him in his final weeks. A trade publication reported that the subprime mortgages had ballooned to 20 percent of all loans, triple the level of a few years earlier."
If this is true, then it implies an incredible level of incompetence on Greenspan's part. The rise in subprime lending was not some obscure fact known only to a privileged few. It was a widely noted development in the housing market over the years 2003-2005. If Greenspan was just made aware of this growth as in the last month of his tenure in January of 2006, then he was incredibly negligent in performing his job.
The growth in housing prices had been the central fuel of the U.S. economy in the recovery following the 2001 recession. Greenspan had been an eager proponent of housing dismissing the concerns of those who warned of a housing bubble. If he did not even know of the surge in subprime lending, then it is difficult to imagine any possible basis on which he could have ruled out the existence of a bubble in the housing market. (The article says that Greenspan "did not recall" whether he mentioned the growth in subprime lending to Bernanke. If Bernanke, did not already know about the growth in subprime, then he is not competent to be chairman of the Fed.)
In short, this article does more to conceal than reveal the developments that led to the current housing crash. There were no deep mysteries that had to be uncovered. House prices had gotten badly out of line with fundamentals by 2002. This was possible for any competent analyst to recognize just as it was possible to recognize the stock bubble by 1998. Unfortunately, the Post and the rest of the media relied almost exclusively on analysts who somehow failed to recognize the housing (and stock) bubbles or worse, had a direct interest in perpetuating these bubbles. Even after the fact, the Post is still choosing to rely almost exclusively on those who failed to see the bubble, rather than the experts who foresaw and warned of the problems ahead.
Dean Baker: The Post Misses the Housing Bubble Yet Again
We have seen all this before. Bubbles and busts have been part of the American experience since the time of Andrew Jackson. Economic systems structured around debt leverage are inherently unstable. A debt doesn't automatically change when the situation of the debtor changes; debt is inflexible, whereas income, equity, and value are at the mercy of the market. Debts are like shoals; inconsequential when the water is high, but deadly when just beneath the surface.
Now that the weaknesses of the mortgage industry are becoming apparent, I would invite readers with imagination to brainstorm in the comments a different system of providing housing to the vast majority of the public. Given the power of the financial sector, it is unlikely that radical restructuring of home financing would have a chance of becoming a reality any time soon, but, given an extended crisis, who knows how many minds might be open to something fundamentally different?
The problem, as conceived by the economists, the media, and government, is how to keep the present system going.
The question we ought to be asking is how we can house people as cheaply and comfortably as possible without pauperizing them, and at the same time giving them the maximum freedom to choose where to live and what to live in.
There has got to be a better way.
Since the '30s, government policy has had a profound effect upon what kind of homes were built, where they were built and how they were paid for. There is no reason why that policy cannot be altered for beneficial results.
For what it's worth, here's a proposal: The government lends you up to, say $150,000, on a house valued at no more than $175,000, interest-free, with equal monthly payments for 20 years. If you sell it at a profit, you have to put it into another house or the government gets to recoup the foregone interest out of the equity. After age 65 you get to keep the equity. You would still have to qualify for the loan, however, and a house whose price exceeds the $175,000 maximum (indexed for inflation) + any equity you might have accumulated in the sale of your previous house, would not qualify. If you want a MacMansion, you would still have to go to the bank and pay the interest on the entire amount financed.
Here's another idea: Finance mortgages the traditional way, but limit annual total payments to a fixed percentage of the homeowner's gross adjusted income for the year (with a reasonable floor to protect the lender), with any shortfall subtracted from interest and automatically forgiven. That way, the lender assumes some of the risk of declining wages and rising unemployment.
Neither of these suggestions may turn out to be practical or even possible, but I am offering them in an effort to stimulate some creative thought about our way of housing Americans.
It would be desirable, in my opinion, to eliminate debt completely from housing transactions, but I'm not sure that is possible. For many years, a home has been the nest egg for the middle class, subsidized by the mortgage interest deduction and capital gains tax break, and fed by the rising value of residential real estate. Now that many nest eggs are vanishing, it behooves us to examine the laying of nest eggs. A speculative nest egg is about as secure as Humpty-Dumpty, and just as likely as Humpty-Dumpty to be put back together again after it goes.
Of course, it is entirely possible that the bursting of the housing bubble and the "great fall of the offwall entailed at such short notice," is merely another phase of the great campaign to fleece the middle class of its remaining wealth, a campaign that has been effectively waged since Reagan became president.
Put your out-of-the-box ideas for housing in the comments.
Read the article.
Flora is on the short list for the laboratory, along with Athens, Ga., Manhattan, Kan., Butner, N.C., and San Antonio.
USA Today recently ran an article on the issue in which our own representative Chip Pickering is quoted as strongly supporting the move to Flora.
Read the article and ask yourself whether or not you would like to live anywhere close to a facility that works not only with hoof-and-mouth disease, but also with diseases that can infect human beings.
Podcast
Take the war in Iraq, for instance. Look who is winning and who is losing. The winners: Exxon, Haliburton, KBR, Blackwater, BP, Shell, etc.
The losers: first, you, my friend, unless you work for one of the aforesaid winners. A gas station is nothing more than a device to transfer your money to the coffers of the aforesaid winners. Of course the IRS also transfers quite a bit of your money into the coffers of the winners as the government pays them obscene amounts of money for the war
The rest:
- your sons and daughters serving in Iraq;
- the standing of the United States as a bastion of freedom, justice and prosperity;
- the Iraqis; and
- the less affuent of the world who are starving because the price of food staples has gone through the ceiling.
I can’t make this up:
In a hotel room in Brussels, the chief executives of the world’s top oil companies unrolled a huge map of the Middle East, drew a fat, red line around Iraq and signed their names to it.
The map, the red line, the secret signatures. It explains this war. It explains this week’s rocketing of the price of oil to $134 a barrel.
It happened on July 31, 1928, but the bill came due now.
Barack Obama knows this. Or, just as important, those crafting his policies seem to know this. Same for Hillary Clinton’s team. There could be no more vital difference between the Republican and Democratic candidacies. And you won’t learn a thing about it on the news from the Fox-holes.
In short, the energy barons of the world have, since 1928, been doing everything in their considerable power to keep Iraq's oil off the market.
Palast has been writing about this for years. Has it gotten any traction? Don't be silly.
Read the column. Is there any other reasonable explanation for U. S. Policy towards Iraq since 1928? As Sherlock Holmes remarked, “When you have excluded the impossible, whatever remains, however improbable, must be the truth.”
So what these barons are doing is not stupid. It's a lot worse; it is insane. It will, if not stopped, lead to our impoverishment and eventually our destruction. Even the wealthy and powerful will not be able to avoid the consequences of what they are doing.
The prosecution of Diaz follows the pattern followed in other states by federal prosecutors, targeting popular Democratic officeholders, often on vague and ominous charges shortly before close elections. In Diaz's case, it was loans to his campaign by plaintiff lawyer Paul Minor, that the prosecutors claimed influenced Diaz and gave Minor an advantage when his cases came before the Mississippi Supreme Court. The problem with that theory was that Diaz had recused himself on every single case of Minor's and could not have possibly had anything to do with the outcome of Minor's cases.
The Raw Story recently featured an interview with Justice Diaz telling what happened. Every Mississippian with the slightest interest in what is going on in this state should read it:
Diaz: One of the main reasons that I feel that I as an individual was targeted rather than my conduct was targeted was because there were actually other judges that I served with who also had campaigns loans guaranteed by Paul Minor and these judges were not prosecuted. Specifically, the Chief Justice of the Mississippi Supreme Court, Edwin Pittman, also had a campaign loan guaranteed by Paul Minor.
The main difference between me and Pittman was that Pittman voted in all of Minor’s cases and even authored opinions that were favorable to Minor and his clients while I did not participate. Now, I am not saying that Pittman did anything wrong. However, I could never understand, and it has never been explained to me, how his conduct and active participation and favorable rulings were ignored and I was indicted and prosecuted for bribery and I had never been involved in Minor’s cases.
The only reasonable explanation seems to be that prosecutors were more interested in specific individuals and not the conduct of an individual. James Thomas (who has since died) was another judge I served with who had a campaign loan guaranteed by Minor. Judge Thomas also participated in Minor’s cases and was not prosecuted. I do not believe, and do not want to be seen as implying, that Thomas did anything inappropriate, just that under similar circumstances I was prosecuted and others were not. Federal prosecutors were fully aware of these other loans but chose not to prosecute them, even though these judges ruled in Minor’s favor in cases before them. Again, I did not participate in any of Minor’s cases and was indicted and tried for bribery [and eventually exonerated]. The only reasonable explanation is that prosecutors were more interested in prosecuting particular individuals.
There are many facets to the story of the events surrounding the much-publicized trial of Diaz, Minor and state trial judges John Whitfield and Wes Teal, and hopefully someone will eventually write a book that weaves together the numerous threads spun by Karl Rove, the Justice Department, Dunn Lampton, and the FBI. When and if the whole story is told, it will likely be revealed as a part of a nationwide project by the Bush administration to use the justice system—judges, prosecutors, and the FBI—to further its own partisan political ends. It will not reflect well on any of the officials involved in the proceedings, least of all District Judge Henry Wingate, whose rulings on critical issues invariably favored the prosecution.
http://www.boston.com/business/articles/2008/03/28/advanced_tactic_targeted_grocer/
Undoubtedly all of Hannaford Brothers's servers were running the same software using the same communications protocols, and most likely they were all running on the same hardware. Standardization cuts costs, and large corporations have been especially diligent in standardizing their information technology resources.
Standardization also made it easy, once the cyber-thieves learned how to compromise one server, to commandeer all of Hannaford Brothers's servers, quickly and quietly.
HB's information structure was a monoculture. In the natural world of living things, monocultures are highly vulnerable to disease, pests and changes in environment. Industrial agriculture requires heavy applications of pesticides, herbicides. and fertilizer to grow monocrops. The same goes for corporate IT, where at least part of the savings from standardization must be spent on anti-virus software and anti-spybot software for every organizational computer and on sophisticated firewalls between the local network and the rest of the world. And IT is still vulnerable to hackers, no matter how carefully the systems are engineered.
It might have cost Hannaford Brothers more to diversify their software and hardware, but the diversity would have made it almost impossible for thieves to have compromised the entire network and probably would have made it more likely that the exploit would be discovered.
The following is a talk Lovins made in 2005.
The history of public institutional psychiatric care since the 1050s has been a story of deinstitutionalization and treatment with new drugs for schizophrenia (Thorazine), depression (tricyclics), bipolar disorder (lithium and valproic acid), and numerous other mental disorders for which the only treatment had previously been involuntary confinement, too often under inhumane and squalid conditions. It has also involved policy decisions by Federal and state governments as to Medicare and Medicaid funding (patients in public hospitals not eligible) and a series of civil rights lawsuits that restricted the ability of states to confine the mentally ill indefinitely without due process or treatment.
The 15 experts consulted by the Center consistently estimated that 50 (range 40 to 60) public psychiatric beds per 100,000 population are needed for hospitalization for individuals with serious psychiatric disorders. This assumes the availability of good outpatient programs and outpatient commitment.
Mississippi, at 49.7 beds per 100,000, barely meets that minimum (at least within a margin of error), but it is the only state to do so, followed by South Dakota at 40.3.
The consequences of this negligence are not speculative:
1. Marked increase of persons who are homeless.
The effect of mentally ill homeless persons on the quality of life on nation’s sidewalks and in parks and public libraries are known by all who live in cities. According to one observer: “A simple visit to the local elementary school, post office or grocery store . . . can be a Dantean journey through the dark underside of our society. Violence, harassment and an astonishing list of antisocial behavior are commonplace.” These social costs are matched by fiscal costs. In Los Angeles it was estimated that the cost of “arrests, incarcerations, emergency medical care and other crisis interventions” runs between $35,000 and $150,000 per person per year for individuals who are chronically homeless. In Reno “a chronically homeless mentally ill man . . . cost the county at least $1 million during his 10 years on the streets before he died in 2005.” Fiscal conservatives thought that they would save money by emptying state mental hospitals, but they in fact only shifted the fiscal burden from the department of mental health to departments of corrections and social services and to the courts.
2. Massive increase in severely mentally persons in jails and prisons:
The three largest de facto psychiatric institutions in the United States are the Los Angeles County Jail, Chicago’s Cook County Jail, and New York’s Riker Island Jail. We have been unable to identify a single county in the nation where the county psychiatric inpatient facility is holding as many mentally ill individuals as the county jail. And once a person is in jail, it is almost impossible to find them a bed in a psychiatric hospital. In Virginia, for example, Sheriff Paul Lanteigne of Virginia Beach “estimates that it typically takes at least six months to find an available bed for a deranged inmate.”
3. Concentration of mentally ill persons in emergency rooms, waiting for psychiatric beds to be found:
4. Violent crime:In North Carolina, for example, Doug Trantham at the Smoky Mountain Mental Health Center described “an inpatient crisis so bad that what it does is backup the entire system.” Officers there have sometimes had to drive patients across the entire state—a seven- to eight-hour drive one way—to a hospital with a bed. Emergency rooms are said to have mentally ill people waiting “four or five days in our ICU just waiting for a place to go. . . . You may have somebody in there all weekend, screaming for 12 or 18 hours,” said a nurse. It is the same in every state; in Arlington, Virginia, county officials had to call 31 hospitals before finding one that would accept a patient. The impact of overburdening the ERs with patients needing hospital beds goes far beyond psychiatric patients; rather, it interferes with all medical and surgical care in the ER.
Because there are so few beds available, individuals with severe psychiatric disorders who need to be hospitalized are often unable to get admitted, and those who are admitted are often discharged prematurely. Fred Markowitz, in his 2006 study of 81 American cities, reported a statistically significant correlation between the number of public psychiatric beds available in that city and the prevalence of violent crimes, defined as murder, robbery, assault, and rape.11 This is not surprising, since studies have shown that between 5 to 10 percent of seriously mentally ill persons living in the community will commit a violent act each year, almost all because they are not receiving treatment. Such individual are responsible for at least 5 percent of all homicides.
Many readers will recall the death on April 18, 1993 of Matt Devenney, shot by a mentally ill man in front of the Community Stewpot where Devenney was the director. What most people did not know was that a Hinds County Chancery judge had previously found the killer to be insane and dangerous, but could not convince the powers-that-were to keep him confined at Whitfield. Each time, while the judge watched helplessly, they released him after a short stay. Eventually, he killed somebody.
It ought not to take a murder to convince a shrink that a patient is dangerous.
I suspect, however, that they did know that he was dangerous, but just didn't have a long-term bed or a cell. Now he does.
So while we may be ahead of the rest of the nation in the statistical tables, what we are doing is still inadequate.
Along with the dysfunction, however, occasionally comes insight. You acquire it at the cost of leaving home and settling in a strange land for a time and then returning to live. That is the plot of the modern southern novel, and it is nothing more than a retelling of a journey that repeats itself in real life over and over. The south is a mother one must leave in order to grow up.
Joe Bageant has made that journey. Here is a recent interview of his on Australian TV:
Click here for video of Joe Bageant interview on Australian TV.
P.S. Posting will be infrequent for another week while I finish what I hope will be my last legal brief and become more proficient on the Dvorak keyboard.
I don't recall a more foreboding column from Fisk. It is clear that he believes we are about to reap, in Churchill's phrase, a "bitter harvest," all of it completely predictable.So what can a Middle East correspondent write on a Saturday morning except that the world in the Middle East is growing darker and darker by the hour. Pakistan. Afghanistan. Iraq. "Palestine". Lebanon. From the borders of Hindu Kush to the Mediterranean, we – we Westerners that is – are creating (as I have said before) a hell disaster. Next week, we are supposed to believe in peace in Annapolis, between the colourless American apparatchik and Ehud Olmert, the Israeli Prime Minister who has no more interest in a Palestinian state than his predecessor Ariel Sharon.
Robert Fisk: Darkness falls on the Middle East
Recently, I came across an essay by Wendell Berry, who, along with Matthew Fox, Thomas Berry, and a host of other thinkers, authors, scientists and teachers, has established a spiritual basis for the care of the earth, that, while it does not explain why fundamentalists have ignored the crisis, sets out a compelling case for Biblical environmentalism.
http://www.crosscurrents.org/berry.htm
Berry suggests that Christians read their Bibles:
If we read the Bible, keeping in mind the desirability of those two survivals--of Christianity and the Creation--we are apt to discover several things that modern Christian organizations have kept remarkably quiet about, or have paid little attention to.
We will discover that we humans do not own the world or any part of it: "The earth is the Lord's, and the fulness thereof: the world and they that dwell therein" (Ps. 24:1). There is in our human law, undeniably, the concept and right of "land ownership." But this, I think, is merely an expedient to safeguard the mutuality of belonging without which there can be no lasting and conserving settlement of human communities. This right of human ownership is limited by mortality and by natural constraints upon human attention and responsibility; it quickly becomes abusive when used to justify large accumulations of "real estate," and perhaps for that reason such large accumulations are forbidden in the twenty-fifth chapter of Leviticus. In biblical terms, the "landowner" is the guest and steward of God: "the land is mine; for ye are strangers and sojourners with me" (Lev. 25:23).
We will discover that God made not only the parts of Creation that we humans understand and approve, but all of it: "all things were made by him; and without him was not anything made that was made" John 1:3). And so we must credit God with the making of biting and dangerous beasts, and disease-causing microorganisms. That we may disapprove of these things does not mean that God is in error, or that the creator ceded some of the work of Creation to Satan; it means that we are deficient in wholeness, harmony, and understanding--that is, we are "fallen."
We will discover that God found the world, as he made it, to be good; that he made it for his pleasure; and that he continues to love it and to find it worthy, despite its reduction and corruption by us. People who quote John 3:16 as an easy formula for getting to heaven neglect to see the great difficulty implied in the statement that the advent of Christ was made possible by God's love for the world--not God's love for Heaven or for the world as it might be, but for the world as it was and is. Belief in Christ is thus made dependent upon prior belief in the inherent goodness--the lovability--of the world.
We will discover that the Creation is not in any sense independent of the Creator, the result of a primal creative act long over and done with, but is the continuous, constant participation of all creatures in the being of God. Elihu said to Job that if God "gather unto himself his spirit and his breath; All flesh shall perish together . . . " Job 34:15). And Psalm 104 says: "Thou sendest forth thy spirit, they are created.... " Creation is God's presence in creatures. The Greek Orthodox theologian, Philip Sherrard, has written that "Creation is nothing less than the manifestation of God's hidden being." Thus we and all other creatures live by a sanctity that is inexpressibly intimate. To every creature the gift of life is a portion of the breath and spirit of God. As the poet, George Herbert, put it,
Thou are in small things great, not small in any.... For thou art infinite in one and all.
We will discover that, for these reasons, our destruction of nature is not just bad stewardship, or stupid economics, or a betrayal of family responsibility; it is the most horrid blasphemy. It is flinging God's gifts into his face, as of no worth beyond that assigned to them by our destruction of them. To Dante, "despising Nature and her gifts" was a violence against God. We have no entitlement from the Bible to exterminate or permanently destroy or hold in contempt anything on the earth or in the heavens above it or in the waters beneath it. We have the right to use the gifts of Nature, but not to ruin or waste them. We have the right to use what we need, but no more, which is why the Bible forbids usury and great accumulations of property. The usurer, Dante said, "condemns Nature. . . for he puts his hope elsewhere."
I have omitted the footnotes, which can be found in the original document linked above.