Values? That is When Wal-Mart Uses Layers of Foreign Contractors To Evade Responsibility

Values? That is When Wal-Mart Uses Layers of Foreign Contractors To Evade Responsibility

Bangladesh is half a world away from Bentonville, the Arkansas city where Wal-Mart is headquartered. This week, Wal-Mart surely wishes it were farther away than that.

Over the weekend, a horrific fire swept through a Bangladesh clothing factory, killing more than 100 workers, many of whose bodies were burnt so badly that they could not be identified. In its gruesome particulars — locked doors, no emergency exits, workers leaping to their deaths — the blaze seems a ghastly centennial reenactment of the Triangle Shirtwaist fire of 1911, when 146 workers similarly jumped to their deaths or were incinerated after they found the exit doors were locked.

The signal difference between the two fires is location. The Triangle building was located directly off New York’s Washington Square. Thousands watched the appalling spectacle of young workers leaping to the sidewalks 10 stories down; reporters and photographers were quickly on the scene. It’s not likely, however, that the Bangladesh disaster was witnessed by anyone from either the United States or Europe — the two markets for which the clothes made inside that factory were destined. For that, at least, Wal-Mart should consider itself fortunate.

The Bangladesh factory supplied clothing to a range of retailers, and officials who have toured the site said they found clothing with a Faded Glory label — a Wal-Mart brand. Wal-Mart says that the factory, which had received at least one bad report for its fire-safety provisions, was no longer authorized to make its clothing but one of the suppliers in the company’s very long supply chain had subcontracted the work there “in direct violation of our policies.”

If this were an isolated incident of Wal-Mart denying responsibility for the conditions under which the people who make and move its products labor, then the Bangladeshi disaster wouldn’t reflect quite so badly on the company. But the very essence of the Wal-Mart system is to employ thousands upon thousands of workers through contractors and subcontractors and sub-subcontractors, who are compelled by Wal-Mart’s market power and its demand for low prices to cut corners and skimp on safety. And because Wal-Mart isn’t the employer of record for these workers, the company can disavow responsibility for their conditions of work.

This system isn’t reserved just for workers in faraway lands: Tens of thousands of American workers labor under similar arrangements. Many are employed at little more than the minimum wage in the massive warehouses in the inland exurbs of Los Angeles, where Wal-Mart’s imports from Asia are trucked from the city’s harbor to be sorted and packaged and put on the trucks and trains that take them to Wal-Mart stores for a thousand miles around.

The warehouses are run by logistics companies with which Wal-Mart contracts, and most of the workers are employed by some of the 200-plus temporary employment companies that have sprung up in the area — even though many of the workers have worked in the same warehouses for close to a decade. Last year, the California Department of Industrial Relations, suspecting that many of these workers were being cheated, charged one logistics company that runs a warehouse for Wal-Mart with failing to provide its employees with pay stubs and other information on their pay rates. Wal-Mart itself was not cited. That’s the beauty of its chain of deniability.

A small band of these warehouse workers has been demonstrating for the past couple of months to bring attention to the bizarrely contingent nature of their employment and the abuses that flow from it. Their numbers were augmented Friday byactual Wal-Mart employees in stores around the nation, calling attention to the everyday low wages and absence of benefits that the vast majority of the company’s 1.4 million U.S. employees receive.

Other discount retailers — notably Costco and Trader Joe’s — pay their workers far more, train them more extensively, have much lower rates of turnover and much higher rates of sales per employee, according to a Harvard Business Review article by Zeynep Ton of the MIT Sloan School of Management. Costco is a very profitable business, but Wal-Mart maintains an even higher profit margin, which it achieves by underpaying its employees.

If Wal-Mart brought half their foreign contractor work back to America and paid employees at factories and at retail stores a living wage, they would still make billions in profits. What they are doing is doing their best to redistribute the fruits of labor to themselves and other wealthy investors. The radical anti-American conservative movement knows that this is the best way to weaken the economic and political will of the average American and make a lot of money doing it.

Fox says Thomas Ricks apologized for 'wing of the Republican party' comment; Ricks says no

9 Plutocracy Alert: Greedy CEOs Trying to Shred the Safety Net While Pigging Out on Corporate Welfare

There is nothing more harmful for the middle class than Republican Members of the House in districts that have been gerrymandered so that caricatures like Michele Bachmann (R-Homophobia) only fear in life is a primary challenge from an even more ridiculous Republican.

Fox News' Benghazi Madness Proves The Network Won't Change

Mitt Romney's 47% World View is Dangerous and Hypocritical

Mitt Romney's 47% World View is Dangerous and Hypocritical

Will Moocherpalooza have an impact on the presidential campaign? It might. Mitt Romney, Paul Ryan and their allies have been decrying the “entitlement society” and supposedly low number of Americans paying federal taxes for some time now. But the specific language and circumstances of Romney’s comments at a May fundraiser, first reported in Mother Jones on Monday, may capture the attention of average Americans in a way those previous speeches and writings did not.

The episode may also undermine Romney’s support among members of a Republican elite that was already wary of him. Politically speaking, the most significant op-ed on Tuesday wasn’t the even-keeled critique of Romney by David Brooks, a conservative who cares about ideas. It was the more caustic and, apparently, more exasperated blast from Bill Kristol, a conservative who cares about winning elections. That’s going to resonate with the surrogates, strategists, and financiers whose support Romney desperately needs to remain competitive.

But, in the long run, whether this episode affects perceptions of Romney may matter less than whether it affects perceptions of government.

Romney’s argument is actually an amalgam of two separate, although related, claims that you hear all the time in conservative circles. The first is about who pays taxes and, more important, who does not. Romney pointed out that, today, 47 percent of Americans don’t pay federal income taxes. But Romney neglected to point out that most people still pay federal payroll taxes and state taxes, both of which are regressive. And most of the people who don’t pay income taxes now either paid them in the past or will pay them in the future. Romney really has no excuse for making this argument; critics, among them my valiant and persistent colleague Timothy Noah, have been pointing out these omissions for months. (And that's not to mention the fact that Romney himself pays relatively little in taxes, since he relies heavily on investment income that is subject to lower rates and can be easily sheltered.)

The other claim might seem the more defensible of the two: It’s the argument that many more people have become dependent on government programs, placing unsustainable claims on the federal treasury and reducing incentives to work. A seminal text for this argument is “A Nation of Takers: America’s Entitlement Epidemic,” an essay by Nicholas Eberstadt of the American Enterprise Institute. Its key piece of evidence is the observation that, since 1960, “government transfers to individuals” have risen sharply. According to Eberstadt,

    What is monumentally new about the American state today is the vast and colossal empire of entitlement payments that it protects, manages, and finances. Within living memory, the government of the United States has become an entitlements machine. As a day-to-day operation, the U.S. government devotes more attention and resources to the public transfers of money, goods, and services to individual citizens than to any other objective: and for the federal government, these amounts outpace those spent for all other ends combined.

Mark Schmitt, a regular contributor to TNR and senior fellow at the Roosevelt Institute, wrote an elegant critique of Eberstadt’s argument. So did Lane Kenworthy, a sociologist at the University of Arizona. As they note, Eberstadt is correct when he says that the entitlement state has expanded significantly in the last 50 years. But that increase reflects two factors more than anything else: Health care and old people. (Relatively speaking, the cost of low income programs outside of health care is actually declining.) In 1965, with the enactment of Medicare and Medicaid, the federal government assumed responsibility for financing medical care for the elderly, as well as the poor and disabled. It also boosted Social Security payments to provide more of the elderly with adequate incomes. The aging of the population and rising cost of medical care have made these propositions significantly more expensive over time. 

Are the people who benefit from these programs today takers rather than makers? Hardly. Most of these people contributed what they could towards he cost of these programs, via payroll taxes, during their working years. If they don’t contribute now—and, remember, the majority of them still contribute something, since Medicare has both cost-sharing and premiums—it’s because they are no longer capable of doing so. They’re too old or disabled to work, and their fixed incomes leave them relatively poor. As Jared Bernstein of the Center on Budget and Policy Priorities reminded me recently, median income for Medicare and Social Security beneficiaries is about $25,000.

The growth of these programs has placed significant new demands on the federal budget. That’s why there should be, and has been, a vibrant debate about how to make the programs sustainable, whether by reducing the money they send out or increasing the money they take in. The growth of other, more narrowly tailored programs (like welfare) has also contributed to the fiscal strain, although far less significantly. That’s why there should be, and has been, an equally vibrant debate about who is eligible for these particular programs and under what conditions they should get them. More nuanced conservatives, among them Brooks, Ross Douthat, and Ramesh Ponnuru, have been part of these discussions for some time.

But the fact that the entitlement state has grown shouldn’t, by itself, alarm us. It’s actually a sign of progress, because it’s a reminder that the government has stepped in to do what the market would not. We saw, in the years before Social Security, what the world looks like when seniors don’t have adequate pensions. And we saw, in the years before Medicare and Medicaid and (now) the Affordable Care Act, what the world looks like when people can’t afford to pay their medical bills. It was not pretty. But the price for addressing those failures was the creation of some massive government programs. They cost a lot of money, yes, but we all benefit from them at some point, as Schmitt noted in his essay: “Most of us, other than the permanently disabled, are givers and takers to government, because that's what it is to be part of a community or a nation.”

It also happens that in what has been called the "The Submerged State" - the part of government subsidies done largely through the tax code and other programs, Romney is one of the 47% who apparently, according to his words, needs to learn how to be independent. Two examples: Mitt Romney Benefited From Government Bailout: Report and Romney’s 'Crony Capitalism': Bain's Big Government Subsidies. In other words Romney and Bain are massive corporate welfare queens. So is every millionaire that buys a mansion whose mortgage is subsidized by tax incentives that we all pay for. Romney and his mindless followers have surely drunk the kool-aid. They live in a world totally detached from reality and guess what, they refuse to take responsibility for their lives and the damage their sick world view is having on the USA.

Sleaze Bag of the Week Paul Ryan (R-WI) - His Votes in Congress Added $6.8 Trillion to Our Nation’s Federal Deficits

Sleaze Bag of the Week Paul Ryan (R-WI) - His Votes in Congress Added $6.8 Trillion to Our Nation’s Federal Deficits

The reputation of Rep. Paul Ryan (R-WI) as a fiscal hawk is at odds with his record of supporting nearly every single budget-busting law of the past decade. Since 2001 he has voted for at least 65 separate pieces of deficit- and debt-increasing legislation, with the total tab for all those votes a whopping $6.8 trillion in cumulative deficits.

Rep. Ryan has served as a member of the House of Representatives since 1998. That year the budget was in surplus and stayed that way for the next three years. But with the start of the George W. Bush administration came the return of the red ink. In January 2001, before any Bush administration policies had been passed, the Congressional Budget Office, or CBO, was projecting budget surpluses totaling $5.6 trillion over following decade. Instead, we got cumulative deficits totaling $6.1 trillion, an $11.7 trillion difference. CBO estimates that laws passed by Congress and signed by Presidents Bush and Barack Obama are responsible for $8.5 trillion of that difference. Rep. Ryan cast his vote for about 80 percent of that $8.5 trillion.

Indeed, during the period when the bulk of the deficit-increasing legislation was passed during the Bush administration Rep. Ryan’s record as a fiscal hawk is even more dismal. From 2001 to 2008, Congress passed and President Bush signed legislation that increased the deficit (just in that period) by a cumulative $4 trillion (policies passed during those years added over $6 trillion to the deficits through 2011). Rep. Ryan voted for well over 90 percent of that. (see figure 1).

Those debt-increasing votes began with the first round of Bush tax cuts—estimated at the time to reduce the projected surplus by nearly $1.3 trillion—and continued with every subsequent round of tax cuts. In total, since 2001 Rep. Ryan voted for over $2.5 trillion worth of deficit-financed tax cuts.

Rep. Ryan also voted, repeatedly, to increase federal spending without paying for it. Most notably, he voted in support of every single defense spending bill over the past 11 years. These votes, on both the regular defense appropriations bills and on a series of “emergency supplementals,” have added nearly $1.9 trillion to the deficit since 2001.

Rep. Ryan also voted numerous times to increase nondefense spending. Of course, the most well-known of these votes was on Medicare Part D, which added over $270 billion in unpaid-for spending. But there are many lesser-known examples. In 2002 he voted for an agriculture bill that added $80 billion to the deficit. He voted for changes to military retirement in 2003 that cost $20 billion in added spending. And he voted for increased borrowing authority for flood insurance that increased federal spending by $17 billion.

Rep. Ryan also voted in favor of many of the annual appropriations bills that authorized spending increases for “nondefense discretionary programs.” To be sure, Rep. Ryan occasionally voted against a handful of these, but the net effect of all of his votes was to increase nondefense spending by $1.3 trillion.

All told, Rep. Ryan voted in favor of increasing federal spending by $3.2 trillion—all without offsetting the costs. Combined with his support for $2.4 trillion in tax cuts, Ryan’s votes contributed to adding trillions of dollars to the national debt, which itself led to more spending as the interest payments on that debt grew. Put it all together, and Rep. Ryan voted for over $6.8 trillion worth of cumulative deficits over the past 11 years.

Republicans have always been big spenders. They just never pay for what they put on the tax payer credit card. So the borrowed money has to be paid, plus interests. They know that the general public regularly votes to throw out whoever is in power. That makes it easy to blame Democrats who inherit the crazy irresponsible debt that Republicans leave behind. Republicans cat this way because of the twisted psychology of the right-wing conservative mind. They hate democracy, the had the concept of government by and for the people, so they just do not care how much damage they do to America as long as it benefits the Republican party. Today's icing on the lying hypocrite cake - Paul Ryan denied he sought stimulus fundsQuestioned, he acknowledges his requests. When you get close to Ryan that stink is the thick layer of unwashed hypocrisy.

Thank Your Conservative Republican Neighbors For Killing America The Land of Opportunity

Thank Your Conservative Republican Neighbors For Killing America The Land of Opportunity

America likes to think of itself as a land of opportunity, and others view it in much the same light. But, while we can all think of examples of Americans who rose to the top on their own, what really matters are the statistics: to what extent do an individual’s life chances depend on the income and education of his or her parents?

Nowadays, these numbers show that the American dream is a myth. There is less equality of opportunity in the United States today than there is in Europe – or, indeed, in any advanced industrial country for which there are data.

This is one of the reasons that America has the highest level of inequality of any of the advanced countries – and its gap with the rest has been widening. In the “recovery” of 2009-2010, the top 1% of US income earners captured 93% of the income growth. Other inequality indicators – like wealth, health, and life expectancy – are as bad or even worse. The clear trend is one of concentration of income and wealth at the top, the hollowing out of the middle, and increasing poverty at the bottom.

It would be one thing if the high incomes of those at the top were the result of greater contributions to society, but the Great Recession showed otherwise: even bankers who had led the global economy, as well as their own firms, to the brink of ruin, received outsize bonuses.

A closer look at those at the top reveals a disproportionate role for rent-seeking: some have obtained their wealth by exercising monopoly power; others are CEOs who have taken advantage of deficiencies in corporate governance to extract for themselves an excessive share of corporate earnings; and still others have used political connections to benefit from government munificence – either excessively high prices for what the government buys (drugs), or excessively low prices for what the government sells (mineral rights).

Likewise, part of the wealth of those in finance comes from exploiting the poor, through predatory lending and abusive credit-card practices. Those at the top, in such cases, are enriched at the direct expense of those at the bottom.

It might not be so bad if there were even a grain of truth to trickle-down economics – the quaint notion that everyone benefits from enriching those at the top. But most Americans today are worse off – with lower real (inflation-adjusted) incomes – than they were in 1997, a decade and a half ago. All of the benefits of growth have gone to the top.

America has become a country not “with justice for all,” but rather with favoritism for the rich and justice for those who can afford it – so evident in the foreclosure crisis, in which the big banks believed that they were too big not only to fail, but also to be held accountable.

Defenders of America’s inequality argue that the poor and those in the middle shouldn’t complain. While they may be getting a smaller share of the pie than they did in the past, the pie is growing so much, thanks to the contributions of the rich and superrich, that the size of their slice is actually larger. The evidence, again, flatly contradicts this. Indeed, America grew far faster in the decades after World War II, when it was growing together, than it has since 1980, when it began growing apart.

Conservative Republicans seem to be stuck in permanent adolescent mode with a wild crush on the super rich kids. That is not politics, that is some kind of deep-seated physiological problem. Conservatives are concerned that some poor kid and his mother might be getting some apple juice they do not deserve, but could care less that billionaires - 1% of so of the population - are sucking up three fifths of the nation's productivity.

Romney's (non) military record faces new scrutiny. Just call Mitt, Mr. Deferment.

Thanks Conservative Republicans For an Economy That Rewards The Wealthy at The Expense of Workers

Both charts show economic growth during Obama administration.




Thanks Conservative Republican For an Economy That Rewards The Wealthy at The Expense of Workers

The AFL-CIO has released its CEO Paywatch with 2011 data. So how do CEOs stack up against ordinary workers? Well, the average CEO of a company on the S&P 500 Index earned 380 times the average American worker's wage, with average CEO pay having increased 13.9 percent in 2011.

The highest-paid CEO in the country was Apple's Timothy Cook, whose total compensation was nearly $378 million. That's more than 11,000 times the average worker's income of $34,053. The 100th highest-paid CEO, Heinz's W.R. Johnson, had total compensation of more than $18 million, 543 times the average worker's income.

What we can't know is how much CEOs make compared with the workers in their own companies; however, that's something the Dodd-Frank Wall Street reform bill will soon require companies to disclose. And it turns out it might well be good for companies if transparency pushed them to bring CEO pay a little more in line with average worker pay:

    High CEO-to-worker pay ratios can reduce the performance of companies. Academic research has found that steep pay disparities hurt employee morale and productivity. Extreme disparities between CEO and employee pay also have been shown to result in a significant deterioration in the quality of products produced.

    In companies where CEO compensation is disproportionately high compared with that of other employees, CEO-to-worker pay disparities can cause high employee turnover and lower job satisfaction. Another study found that firms with high levels of CEO pay relative to other top executives also reduce performance.

Those results are in sharp contrast to the current corporate wisdom self-interested myth that CEOs are worth every penny, that these pay levels represent meritocracy and that lower-paid CEOs would mean companies being less effectively run. But you have only to compare current CEO-to-average worker pay levels to those in the past to see that there just might be a decent argument for doing things differently.

Whatever this is, it is not capitalism as most American understand it. The average American stills believes that people get ahead on merit. And are paid more based on merit. Instead what we have is very wealthy people giving each other huge sums of money just because. Just because they're friends. Just because they talk a good game. Just because they are connected. Not because they produce anything themselves. Most CEOs - not all - most do not even know how to make their products. They would not have a clue how to distribute anything. If they had to do the work of the average employee they'd be lost. Middle- managers do the actual day to day management of the company. Conservatives have made America into 17th century France. All we're missing is the crowns and fancy velvet clothes.

Mitt Romney's Noblesse Non Oblige

There's nothing wrong with being born with a silver spoon in your mouth. It's what you do with that good fortune that matters. And that is at the heart of Mitt Romney's problem with the American people. With his proclamations and policies, the same man who denounces President Obama as "out of touch" and "Marie Antoinette" shows his aloof detachment and stunning incomprehension of the struggles Americans face every day. And yet, they don't begrudge him either his privileged past or financial success. Instead, they just want him to acknowledge the debt he owes to the society that made it possible.

Conservatives Used to Love America at Least a Little, What Went Wrong

Conservatives Used to Love America at Least a Little, What Went Wrong

Does anyone else remember the Western Hemisphere's only functioning socialist paradise? In that bygone land, the top income-tax bracket for millionaires was 90 percent. Thanks to a heavily—and proudly—unionized workforce, collective bargaining resolved most labor-management disputes. To stave off recession, the government instituted the largest public-works program in Country X's history, from which its now largely unwitting citizens still benefit today.

Although Country X did possess a sizable nuclear deterrent, the trade-off was a reduction in spending on conventional military capabilities. "Our most valuable, our most costly asset is our young men. Let's don't use them any more than we have to," was the typically commonsensical explanation given by paradise's wildly popular leader for his reluctance to commit Country X to adventurist foreign wars. Despite an excruciating level of world tension at the time, not a single member of Country X's armed forces died in battle on his watch.

Those happy days were America’s. True, it would be going much too far to call Dwight D. Eisenhower the architect of the United States in the 1950s. From the GI bill's vital role in creating the midcentury middle class to our powerhouse postwar economy, the catbird seat America then occupied wasn't Ike's doing. Well, except in the sense that winning World War II made it all possible, and he'd been the guy who said "OK, we'll go" on D-Day.

But Eisenhower the president was more than paradise's caretaker. At the very least, he's the man who made it all seem normal. That's some achievement when you think of the astounding metamorphoses in American life, self-perception, and role on the world stage that his reign enshrined.

Besides being the most underestimated president of the 20th century, Eisenhower deserves to be every Democrat's favorite Republican White House occupant this side of Abraham Lincoln. The reasons range from creating an Interstate highway system that's rightly named for him and deciding to perpetuate the New Deal, to his crucial decision to enforce Brown v. Board of Education in the teeth of Southern resistance. No militant on civil rights, Ike nonetheless ordered the 101st Airborne to Little Rock in the crunch to remind everybody that even unpopular Supreme Court decisions had better be respected. If not for that resolve, desegregation might have ended before it began.

The record elsewhere isn't all rosy. If Eisenhower kept the military on a short leash, he let the feeling-its-oats CIA run amok. The U.S.-engineered 1953 coup that put the Shah of Iran in power is one sin whose consequences we're still living with, and the scars from our similar operation in Guatemala took a long time to heal (if they have). Nor should we forget that the Bay of Pigs was dreamed up during his tenure, though whether he'd have ever green-lit a plan so patently stupid is debatable. Our whole sorry Cold War pattern of sub rosa interventions and propped-up dictatorships in the Third World was largely created on Ike's watch. While he's seldom thought of as a villain, Latin Americans—among others—would have every right to call him just that.

For patriotic Americans to wish that modern Anti-American conservatives were even half as reasonable and even half as patriotic and competent as Eisenhower is a fantasy that will never come true. They seem intent on taking about law and culture back to the days of the treasonous Antebellum South or some European monarchy of the 15th century.

Two of The Biggest Myths of Our Time - Conservatives Are For Small Government and Freedom

Two of the biggest myths of our time - Conservatives are for small government and freedom

A new "emergency" law backed by right-wing think tanks is turning Michigan cities over to powerful managers who can sell off city hall, break union contracts, privatize services—and even fire elected officials.

When the city of Pontiac, Michigan, shut down its fire department last Christmas Eve, city councilman Kermit Williams learned about it in the morning paper. "Nobody reports to me anymore," Williams says. "It just gets reported in the press." This was just the latest in a series of radical changes in the city, where elected officials such as Williams have been replaced by a single person with unprecedented control over the city's operation and budget.

Gov. Rick Snyder put Louis Schimmel in charge of Pontiac last September, invoking Public Act 4, a recent law that lets the governor name appointees to take over financially troubled cities and enact drastic austerity measures. Under the law, passed last March, these emergency managers can nullify labor contracts, privatize public services, sell off city property, and even dismiss elected officials.

Schimmel got to work quickly, firing the city clerk, city attorney, and director of public works and outsourcing several city departments. City fire fighters were told that they would be fired if their department was not absorbed by Waterford Township's. Schimmel has proposed putting nearly every city property up for sale, including city hall, the police station, fire stations, water-pumping stations, the library, the golf course, and two cemeteries.

Williams and his six colleagues on city council have been stripped of their salary and official powers. "Nearly the whole city has been privatized," he laments.

Michigan's emergency-manager law is the centerpiece of the fiscal program enacted by state Republicans after they took over the Legislature and governor's mansion in early 2011. The law's supporters say it allows for a more efficient and nimble response to the budget crisis confronting local governments in the wake of the housing crash and near collapse of the auto industry. Critics are seeking to block and repeal what they call an illegal power grab meant to usurp local governments and break up public-sector unions.

"We haven't seen anything this severe anywhere else in the country," says Charles Monaco, a spokesman for the Progressive States Network, a New York-based advocacy group. "There's been nothing in other states where a budget measure overturns the democratic vote." Williams says emergency managers are able to enact draconian policies that would cost most city officials their jobs: "They couldn't get elected if they tried."

Benton Harbor, Ecorse, and Flint are also currently under emergency management. In Flint, the emergency manager has promised to restructure collective bargaining agreements with the city's police and firefighters unions. Benton Harbor's emergency manager banned elected officials from appearing at city meetings without his consent. Detroit, which is facing a more than $150 million budget shortfall, could be next: Mayor Dave Bing has proposed laying off 1,000 city workers and wrung concessions from public-sector unions in hopes of preventing Gov. Snyder from appointing an emergency manager.

Schimmel has pursued the most aggressive turnaround plan in the state. He says he's simply doing what elected officials have been unable to do: execute a plan for balancing the city's books quickly and efficiently. He's not there yet: The city of 60,000 is projecting a $9 million deficit for 2012. "One thing we can't do is print money," Schimmel says. "We're always chasing the dropping knife, fixing something here and losing revenue somewhere else."

With an indefinite term and a city salary of $150,000, Schimmel doesn't answer to anyone but the governor, at whose pleasure he serves. The city council can no longer make decisions but still calls meetings, which are routinely packed with angry residents. Asked by radio station WJR if the emergency-manager law hands power over to a "dictator," Schimmel sighed, "I guess I'm the tyrant in Pontiac, then, if that's the way it is."

Emergency managers aren't new in Michigan, which has been in dire financial straits for decades. Public Act 4 (officially titled the Local Government and School District Fiscal Accountability Act) beefed up a 1990 law that brought in state-appointed managers to several cities in the 2000s, without much success at stemming the flow of population, jobs, and tax revenue. Pontiac has been under some form of state-appointed management since 2009. Schimmel's predecessor laid off dozens of police officers, hired the county sheriff to patrol the city, and dismissed Mayor Leon Jukowski (whom Schimmel has rehired as a consultant paid at half his previous $104,000 salary). During that time, Pontiac's credit rating had dropped from B to triple-C. "They aren't creating revenue," Williams says of the managers. "You can't just cut your way out of a deficit."

Pontiac is not Schimmel's first clean-up job. In 2000, he was named the emergency manager of Hamtramck, where he served for six years. In 1986, a judge appointed him to oversee Ecorse's finances after the city landed in state receivership; he stepped in and privatized city services. Today, the city is back in debt, and back under state management. Schimmel concedes that the privatization strategy can backfire, but he blames inept local government. "If you don't have an overseer of the contractor, privatization can be much more expensive than in-house services," he explains.

Schimmel is also a former adjunct scholar and director of municipal finance at the Mackinac Center for Public Policy, a free-market think tank that shares his enthusiasm for privatizing public services. The center has received funding from the foundations of conservative billionaire Charles Koch, the Walton family, and Dick DeVos, the former CEO of Amway who ran as a Michigan Republican gubernatorial candidate in 2006.

Conservatives say they are the intellectual descendants of the Founders. Where did the Founders say that officials elected by the people are be arbitrarily replaced by little dictators that represent the interests of crazy right-wing corporations and think-tanks. Thus far these little dictators cannot even claim that privatizing everything in sight solves budget problems. If you privatize the fire department the people should have to pay the corporation that owns the fire service. The only thing these anti-American conservatives and libertarians have done is place a middleman - a corporation that has to make a profit - in the mix. Adding a level of unaccountable bureaucracy.

Most NFL Team Owners Are Right-wing Conservatives So It Figures That The Super Bowl Is Socialist

Most NFL Team Owners Are Right-wing Conservatives So It Figures That The Super Bowl Is Socialist

OK.  It’s the Patriots vs. the Giants.  Between now and Feb. 5th a zillion words will be written about who will win the Super Bowl and why and how and by what point spread. With permission of all you sports fans out there  I’d like to offer a few hundred words to raise another question about this upcoming football contest.

Is the Super Bowl a socialist enterprise?  Yes the language is provocative but not, I believe, inappropriate.  After all Indiana, the site of the next Super Bowl, is currently governed by those who insist government should play a minimal role, and the word they and their Republican counterparts around the country use in this election year to describe those who disagree is socialist.

I submit that the Super Bowl in Indianapolis is socialist from head to toe.

Start with the venue. Governments paid for over 80 percent of the new $750 million Lucas Oil Stadium.  The Colts chipped in about 15 percent, an investment they probably recouped in inflated asset value the day the stadium opened.   Governments are also covering the estimated $20 million a year in operating deficits.

But this is only the tip of the iceberg.  The NFL itself is a government creation.   

Back in 1961 Commissioner Pete Rozelle convinced Congress to grant anti-trust immunity to the NFL to allow it to negotiate with broad companies as a single entity. Its first contract with CBS proved so lucrative that each team had $332,000 in the bank at the beginning of the season, a sum that exceeded most team payrolls at the time. Flush with cash, team owners might have started a bidding war for players if a truly free market in labor prevailed.  

But having eliminated a free market externally in the broadcast marketplace, this new government sanctioned monopoly proceeded eliminated a free market internally ion the labor marketplace. The NFL imposed a rule allowing any team losing a free agent to another team to receive something of equal value from that team.  Few teams were willing to risk signing a high profile free agent only to see their own rosters depleted.  

Free agency came about only in 1993 after a jury ruled in favor of the players in a restraint of trade lawsuit brought by a group of players.   That verdict and the threat of a class action filed by Reggie White of the Philadelphia Eagles on behalf of all NFL players led the league to the bargaining table.  Yet the owners still refused to allow a completely free market by demanding and receiving a salary cap.

Back in 1961, to gain the support of all the owners, the NFL decided to distribute the revenue equally to all teams.  Nothing more socialist than that.  But this created a problem.  The Green Bay Packers were (and are) a non-profit team whose community ownership structure prevented it from blackmailing cities into giving it huge taxpayer subsidies by threatening to leave.  Equal revenue sharing could result in other communities opting for the Green Bay model.  The NFL quickly closed that door by amending its constitution.  Article V, Section 4, often called the “Green Bay Rule,” declares “charitable organizations and/or corporations not organized for profit and not now a member of the league may not hold membership in the National Football League.”

Some might justify the huge subsidies to football stadiums because of their purported equally huge positive local economic impact.  The evidence does not support that argument.  Numerous researchers have examined the question and in virtually every case found no statistically significant positive correlation between sport facility construction and economic development.  As for the Super Bowl itself, a study of six Super Bowls from 1979 to 1998 by economist Phil Porter found no increase in taxable sales in the host community compared to previous years without the game. Economists Robert Baade and Victor Matheson found that hosting the Super Bowl was associated with an increase in employment in host cities of a paltry 537 jobs.   

Not that any of this matters a whit to a true blue football fan.  I myself look forward to sitting back and enjoying a hard fought game.

But this is an election year. A year in which the role of government will be vigorously debated. The Super Bowl is a reflection of governments aggressively intervening, not on behalf of the poor or the consumer or the worker but on behalf of the 1/10th of 1%.  Eighteen of the 32 NFL teams are owned by billionaires.   Perhaps during the interminable commercials we might pause a moment and reflect on the fact that we are watching a truly socialist spectacle.

The NFL is operated much like America's biggest corporations, the profits are private enterprise, but the public has to pay for any losses. Why are at least a third of Americans so in love with the fake patriotism movement known as conservatism and the conservative view of what capitalism should look like..

Vote Rick Santorum Because America Can Never Get Enough Conservative Corruption

Vote Rick Santorum Because America Can Never Get Enough Conservative Corruption

Rick Santorum has received, and courted, plenty of comparisons with Mike Huckabee since his near-victory in the Iowa Caucuses, but not all of them have been earned. Yes, like Huckabee in 2008, Santorum has been heavily dependent on grassroots campaigning, with direct appeals to evangelical voters, and a veneer of folksy, blue-collar economic populism. But the comparison ought to stop there. What Santorum cannot match is Huckabee’s status as a genuine Washington outsider, someone untainted by the corrupt dealings inside the beltway. Indeed, Santorum’s record shows him to be deeply connected to the ethically unsavory and legally dubious world of DC influence-peddling.

Since losing his Pennsylvania Senate seat in 2006, Santorum has used his connections to land a series of highly-paid jobs. Consol Energy, a natural gas company specializing in “hydrofracking” and the fifth-largest donor to his 2006 campaign, paid him $142,000 for consulting work. He also earned $395,000 sitting on the board of United Health Services (UHS), a for-profit hospital chain whose CEO made contributions to his Senate campaigns and which stood to benefit from a big hike in Medicare payments Santorum proposed in 2003. (Incidentally, the Department of Justice sued UHS for Medicare and Medicaid fraud during Santorum’s four-year tenure on its board.) Santorum also earned paychecks from a religious advocacy group, a lobbying firm, and a think tank. For pushing legislation benefitting UHS and several other companies, one ethics group named Santorum to its “most corrupt Senators” list.

Santorum has made his post-Senate career doing the sort of quasi-lobbying that helped sink Newt Gingrich’s campaign in Iowa. But in fact, while still in office, he was a central actor in an even more sordid venture: The K Street Project. Started in 1989 by GOP strategist Grover Norquist and brought to prominence by former House majority leader Tom DeLay in 1995, the K Street Project was a highly organized effort to funnel Republican Congressional staffers into jobs at lobbying firms, trade organizations, and corporations, while attempting to block Democrats from those same posts. From 2001 until 2006, Santorum was the Project’s point man for the Senate, while House Majority Whip Roy Blunt manned the House side.

In 2006, the K Street Project was effectively forced to shut down amid public outcry; the following year, an ethics reform law made such outfits illegal. But in its heyday, it helped create an unprecedented revolving door between the White House, Congress and K Street, blurring distinctions between Republican policy and corporate welfare. As Elizabeth Drew put it in a 2005 New York Review of Books piece, “Democratic lobbyists have been pushed out of their jobs as a result; business associations who hire Democrats for prominent positions have been subject to retribution. They are told that they won’t be able to see the people on Capitol Hill they want to see.” Nicholas Confessore, in a groundbreaking 2003 Washington Monthly expose of the Project, detailed the goal bluntly: “First, move the party to K Street. Then move the government there, too.”

At the center of all this was Santorum. According to Confessore, Santorum conducted weekly breakfasts with lobbyists, and occasionally Congressmen and White House staff, during which he attempted to match Republican Hill staffers with K Street job openings. As Confessore put it, “Every week, the lobbyists present pass around a list of the jobs available and discuss whom to support. Santorum's responsibility is to make sure each one is filled by a loyal Republican—a Senator's chief of staff, for instance, or a top White House aide, or another lobbyist whose reliability has been demonstrated.” The group refused to meet with Democrats, and threatened sanctions against lobbies that did.

Revolving door tactics, until then de facto lobbying policy, were formalized and transformed into a “pay to play” system by the K Street Project. In 2003, after the top post at The Motion Picture Association of America went to a Democrat instead of a Republican, House Republicans reneged on an impending tax break, hitting the movie industry with a $1.5 billion bill. After the Democrat was chosen, Roll Call reported that “Santorum has begun discussing what the consequences are for the movie industry.” (Santorum, though he often denies his involvement in the K Street Project, more or less confirmed his involvement in the MPAA flap.) Later that year, the Washington Post revealed that the House Financial Services Committee pressured a consortium of mutual funds to oust a top lobbyist who was a Democrat in exchange for relaxing a pending investigation. After the smoke cleared, she was replaced by a Republican.

Whether the K Street Project was truly successful is up for debate. Confessore and Drew’s reports portray intimidated and marginalized Democratic lobbyists. According to a 2003 Washington Post story, a Republican National Committee official boasted that 33 of 36 top lobbying jobs had recently gone to Republicans. Former lobbyist Patrick Griffin, now an adjunct professorial lecturer at American University, told me that the project embodied the brazen crudeness of “DeLayism,” but also suggested that most lobbying firms and corporations were not “stupid” enough to purge Democratic staff and risk alienating much of the Hill.

What is clear is how much Santorum’s legacy is entangled with the two most corrupt political figures of the last decade: DeLay, and Jack Abramoff, who was said to have been involved in the Project. (Abramoff reportedly attended Santorum’s very first meeting, though Abramoff denied involvement and Santorum said in 2001 he couldn’t remember if he had.) Abramoff’s recent assertion that he “owned” politicians by dangling the promise of highly-paid lobbying gigs in front of powerful Hill staffers, though hyperbolic, is a fairly apt description of the K Street Project’s goals.

Gosh another conservative presidency run like organized crime. It will be like the good old days of the Bush administration or the Reagan administration. Conservatives have absolutely excelled at convincing much of the public that their anti-democracy, anti-constitution, anti-freedom, anti-American values policies are patriotic. Until those Americans wake up and smell the truth we can count on criminals in brooks Brothers suits like Rick Santorum to keep coming back from the dead like the anti-American zombies they are. 

Socialists of the Week - The 2012 Republican Presidential Candidates

Socialists of the Week - The 2012 Republican Presidential Candidates

The Republican Party is catching flat-tax fever — and setting up an epic election-year fight with Democrats over whether wealthier Americans should pay higher taxes or get tax cuts.

Republican presidential candidate Mitt Romney became the latest to punch the tax button Wednesday, telling a Virginia audience that he'll soon update his economic proposal to spell out ways to flatten the tax code.

His vow came just a day after rival Rick Perry grabbed headlines and talk-show chatter with a proposal for an optional flat 20 percent tax on income. Both followed Herman Cain's pitch for a flat 9 percent income tax as part of his 9-9-9 plan, which helped him jump to the top tier of candidates for their party's 2012 nomination. Newt Gingrich and Michele Bachmann endorse a flat tax, too.

The flat tax — so called because it offers one flat rate for taxpayers in all income groups while taking away many or all deductions — would simplify taxes. It also would almost certainly give big tax cuts to wealthy Americans. Republicans believe that cutting taxes, especially on the wealthy, helps to spur investment, economic growth and hiring.

At the same time, most of the Republican candidates are proposing other changes that also would mean big tax cuts for high-income Americans, such as eliminating taxes on dividend income or capital gains, and eliminating the estate tax, called the death tax by Republicans.

Their push comes at the same time that Democratic President Barack Obama is pushing to raise taxes on higher-income Americans. He's proposed raising taxes on those making more than $200,000 and has endorsed a push by Senate Democrats to raise taxes on incomes above $1 million.

The debate comes as new data show that the very wealthiest Americans have greatly increased their share of U.S. income in recent decades. The richest 1 percent claimed 17 percent of American income in 2007, more than double their 8 percent share in 1979, according to a report this week from the non-partisan Congressional Budget Office. Protest over growing income inequality is also among the motive issues driving the Occupy Wall Street demonstrations around the country.

Polls show that a solid majority of Americans favor raising taxes on the wealthy. But that's anathema in the Republican Party, where tax cuts, particularly for higher incomes, are popular. Seven in 10 Americans say that policies of Republicans in Congress favor the rich, according to a New York Times poll published Wednesday.

There's little doubt the Republican presidential candidates' proposals would cut taxes on the wealthy.

Most would eliminate taxes on all or some profits on investments. Most of those taxes now are paid by wealthier Americans.

Most also would eliminate the estate tax, which applies only to estates of $7 million or more and is paid by about 3,270 families each year, according to the nonpartisan Tax Policy Center, a joint project of the Brookings Institution and the Urban Institute, both respected center-left think tanks in Washington.

"These are really wealthy families," said Roberton Williams, an analyst at the Tax Policy Center.

A flat tax on income would take away some deductions but lower the rate. Perry, for example, would cut it to 20 percent. Gingrich would cut it to 15 percent. The wealthiest Americans now pay a 35 percent marginal rate on income above $379,950. A detailed analysis by the Tax Policy Center found that the Cain plan would mean an average tax cut of $455,000 for those with incomes above $1 million.

Romney once criticized a flat tax proposal in 1996 as a boon to the rich, going so far as personally taking out newspaper ads in early primary states to rip the proposal from then-candidate Steve Forbes.

"It's a tax cut for fat cats," Romney said then.

When he unveiled his economic agenda this year, Romney said he would pursue a "long-term goal" of a "flatter, fairer, simpler structure." But he also said he wouldn't change any of the existing personal income tax rates.

On Wednesday in Fairfax, Va., he said, "I'll lay out some additional ways to make the tax code more flat."

While the Republican tax proposals would give tax cuts to the wealthy, the candidates have backed away from the appearance of raising taxes on lower-income Americans.

Cain at first denied that his plan would raise taxes on poorer Americans, then changed it after the Tax Policy Center found that the 84 percent of taxpayers would pay more under Cain's plan.

Gingrich notably would keep the Earned Income Tax Credit, which helps lower-income families offset their payroll taxes for Medicare and Social Security. "Preserving the EITC and Child Tax Credit are critical to ensure that the optional flat tax system does not unfairly target low-income Americans," Gingrich says in a website chart comparing his flat tax to Perry's.

Romney points to his proposal to limit tax cuts on dividends and capital gains to incomes below $250,000. "My view is that a key to the tax policy is to reduce the tax burden on the people who have been hurt most by the Obama economy, and that's the middle class," he said Wednesday.

Gingrich and others have noted, however, that the limit would mean little because people below that threshold pay few taxes on dividends and capital gains.

And Perry would give all taxpayers the option of sticking with the current tax system, meaning no one would have to pay more than they would under today's rules.

 As one can see from the chart above, conservative economic policies are a perverted redistribution of wealth. The people who work the hardest in the U.S. have the least wealth. Most of the top 1% in particular make most of their income from the comfort of their overstuffed leather lounge chair via capital gains from stocks, not from work. The rabid Right, which has come to fully control the radical redistribution policies of the Republican Party says the wealthy already pay most of the federal income taxes. So we should be crying crocodile tears for them. Common sense should tell every American - and the polls seem to indicate most Americans understand that the people who own a disproportionate amount of the nation's wealth should indeed pay most of the taxes since they are the group that owns the most. If taxes went back to what they were during the Clinton administration the very wealthy would still be paying lower taxes than they did in the 1960s.