As GM prepares to cut 21 percent of its US jobs and produce smaller, more fuel-efficient cars, it's mulling over changing the color of its logo from blue to green. The AP reports that the switch would be "an effort to show consumers that it is leaner and greener, more focussed on fuel efficiency and better able to make quick decisions."

Depending on your perspective, this is either a brilliant move or a monumental case of chutzpah. It might signal GM's shifting priorities, or it might come off as an effort to put a new coat of green paint on the same grimy clunker. Given how far GM has to go before it's as green as companies like Toyota or Honda, perhaps the strongest message behind the color change would be this: GM is green with envy.

I had a lot of pictures to choose from this week. I'm not sure why I chose these, but they were nice summery outdoor pictures, and I liked them. Maybe I'll use some of the others next week. In the meantime, enjoy the weekend, everyone.

The New Economy?

Robert Reich says that it's consumers, not investors, who will need to lead a recovery out of our current recession:

Problem is, consumers won't start spending until they have money in their pockets and feel reasonably secure. But they don't have the money, and it's hard to see where it will come from. They can't borrow. Their homes are worth a fraction of what they were before, so say goodbye to home equity loans and refinancings.

....My prediction, then? Not a V, not a U. But an X. This economy can't get back on track because the track we were on for years — featuring flat or declining median wages, mounting consumer debt, and widening insecurity, not to mention increasing carbon in the atmosphere — simply cannot be sustained.

The X marks a brand new track — a new economy. What will it look like? Nobody knows. All we know is the current economy can't "recover" because it can't go back to where it was before the crash. So instead of asking when the recovery will start, we should be asking when and how the new economy will begin. More on this to come.

For many years it's looked as if we were getting closer and closer to an economy in which there flatly wasn't enough unskilled work left to keep employment at normal levels.  Stagnant median wages were the canary in the coal mine, with permanently higher unemployment coming in the future.  But I dunno: maybe the future is now.

I'll write more about this later so that everyone can tell me where I'm wrong.  At least, I hope I'm wrong.  We'll see.

The Overdraft Scam

Kathy Chu reports on the overdraft fee scam, which currently generates nearly $40 billion in income for banks — by far their most lucrative source of fees and penalties:

Some consultants offered banks ways to boost overdraft and credit card revenue. A 2001 "checklist" from Profit Technologies — a firm that has worked with 19 of the USA's 20 largest banks — has more than 600 strategies....One strategy listed to boost overdrafts: "Allow consumers to overdraw their ... accounts at the ATM up to the bank's internally set limit." To increase credit card fees, banks can "delay crediting of payments not received in bank provided envelop (sic) or for which payment coupon is not received for up to 5 days," and "remove bar coding from remittance envelopes," slowing the payment.

....Has banks' pursuit of profit gone too far? Ken Vollmer, 49, of Augusta, Ga., thinks so. He sued Wachovia this year, alleging it "purposely structured transactions to make money." A merchant mistakenly put a hold on his funds, then the bank cleared transactions from high to low, triggering hundreds in overdraft fees, he says. Spokeswoman Richele Messick says Wachovia processes transactions in an "appropriate" way and will "vigorously defend" itself in the case.

Banks clear larger payments first, says Talbott, because they tend to be more important. But Douglass Colbert, who advised banks on overdraft and card strategies at Profit Technologies, says fees are a key driver.

"Banks will say (high-to-low clearing) is for the consumer," he says. "Bottom line is, when it was pitched, we'd say ... a side effect is that it results in more fee income to you because it bounces more checks." Colbert says that after leaving Profit Technologies, he joined a credit-counseling firm and saw the damage fees did to consumers.

Just to make this clear: Say you have $100 in your checking account and four checks arrive at your bank in the following amounts: $15, $20, $30, and $150.  If you clear them in that order, the first three are fine and only the last one incurs an overdraft.  If you clear them in the opposite order, all four incur overdraft fees.  Ka-ching!  That's why banks like to clear high to low.

In any case, if our Congress had any balls they'd fix this in a trice: simply regulate overdrafts as short-term loans, which is what they are.  The interest rates would be high, but nowhere near as high as the effective 1000%+ that banks charge now.  And it wouldn't matter what order checks cleared.

Banks still have to make money, of course, and if overdraft fees went down then the cost of other services would go up.  But that's fine.  There's no reason that overdraft fees from their least prosperous customers should subsidize other business lines.  It's better to charge everyone fairly and openly rather than trying to make outsize profits on the banking industry's poorest customers.

And the chances of this happening?  About zero.  Why?  Don't be silly.  It's because the finance industry still owns Congress.

Jake Tapper tweets on what I'm calling Assgate:

heard more outrage from conservative tweeps today re: alleged POTUS once-over than about @johnensign, @davidvitter + mark sanford combined

And that's outrage over a photo that doesn't show what they say it shows. In other news, John Ensign's parents gave the family of the woman he was having an affair with a $96,000 "gift."

Now if my headline were true, you'd have a real story.

Up North in Iraq

Violence may be increasing in Baghdad, but it's up north in disputed Kurdistan that Iraq's bigger problems are likely to erupt.  Here's the LA Times:

The worst attack Thursday occurred in Tall Afar in Nineveh province in the north, where a double suicide bombing killed 34 people, prompting a senior Iraqi official to express concern that the country's security forces, now fully responsible for protecting the cities, had been penetrated by armed groups.

....Militants appear focused on the north, where Arabs and Kurds are locked in a dispute over a 300-mile stretch of land where Saddam Hussein's regime expelled Kurds and settled Arabs in their place. Iraq's semiautonomous Kurdish region wants to annex those areas, an idea Arabs oppose.

And the New York Times:

With little notice and almost no public debate, Iraq’s Kurdish leaders are pushing ahead with a new constitution for their semiautonomous region, a step that has alarmed Iraqi and American officials who fear that the move poses a new threat to the country’s unity.

....The proposed constitution enshrines Kurdish claims to territories and the oil and gas beneath them. But these claims are disputed by both the federal government in Baghdad and ethnic groups on the ground....Vice President Joseph R. Biden Jr., sent to Iraq on July 2 for three days, criticized it in diplomatic and indirect, though unmistakably strong, language as “not helpful” to the administration’s goal of reconciling Iraq’s Arabs and Kurds, in an interview with ABC News.

I don't have any special comment on this.  Just pointing it out.  Kurdistan has always been the wild card in Iraqi politics, but despite lots of warnings it's never quite erupted.  It always seemed to be a problem for tomorrow.  Now, though, it's possible that tomorrow has finally arrived.

This week, we will focus on positive contributions that people are making to combat the extinction of frogs worldwide:

- In Panama, American and Canadian ex-pats are working to save the golden frog (pictured above).

- At Hartwick College in Oneonta, New York, and Plymouth University in England, professors are learning about why tadpoles have been turning into deformed frogs at incredibly alarming rates.

- Inmates in Washington state are making the most of their sentences by breeding frog species that have rapidly declined in recent years. Check out the video below for an amazing related story:

 

On a sidenote, today I entered the Save The Frogs poetry competition (deadline at midnight tonight) by submitting the following entry:

I entered the swamp, in search of a frog
His name was Mudraker, he hailed from Prague
Though he spoke Czech, his issues were global
Rapid decline, much worse than Chernobyl.

Mudraker came to the US of A
But non-native bull-frogs, scared him away
He battled pesticides throughout the year
Habitat destroyed, he remained austere.

His friends, victims in a deadly abyss,
finished from chytridiomycosis
Don't surf the net or drive Mitsubishis,
Now's our last chance to save these species.

You may have seen this photo, highlighted today by Fox News:

You should note that photos can lie, and this one does. It was debunked yesterday by (gasp!) Fox News: 

And yet the network continues to imply that the photo is an accurate portrayal of reality. Shocking, I know. Does Fox not watch its own programming?

(via MediaMatters)

Healthcare Weirdness

Ezra Klein says he's "baffled" by Michael Kinsley's column on healthcare reform in the Post today.  He's being way too kind.  I read it last night and Kinsley's column isn't even coherent.

Do we need a root-and-branch reform of healthcare in America?  "The answer is probably yes," Kinsley affirms.  But then, without warning, he pulls a high-speed U-turn out of his hip pocket and declares that we shouldn't bother right now regardless.  Why?  Because healthcare reform gets its urgency "merely from [its] association with truly urgent measures like the stimulus package." Because it will cost $100 billion per year or so and it really ought to be free.  Because it will be politically difficult.

Huh?  Healthcare reform was viewed as urgent long before the banking crisis.  Its cost is no surprise at all.  And everyone knew it would be politically difficult from the get go.  None of this is news and none of it makes any sense.

And what makes even less sense is the "low hanging fruit" that Kinsley suggests we implement in place of broad change: malpractice reform, electronic recordkeeping, and comparative effectiveness research.  That's not low hanging fruit.  It's low hanging gnats.  They're all good ideas, but they'd have only a tiny impact on costs and essentially no impact at all on broadening coverage.  It's like telling GM to spend more time designing prettier hubcaps.  Very strange.

Good Stories Gone Bad

On Thursday USA Today published a piece saying that February's stimulus money has "gone overwhelmingly to places that supported President Obama in last year's presidential election."  Matt Yglesias comments:

The insinuation of the piece is that the stimulus bill’s funding streams are being artfully manipulated or something to disproportionately direct resources toward Obama-loving constituencies....[But] the secret to the riddle seems to be that areas that benefit from federal spending formulae tend to support the Democrats. Not as a result of short-term fluctuations in voting patterns or federal spending levels, but as a structural element of American politics.

Actually, that's not quite right.  It's weirder than that.  I just got around to reading the piece, and aside from the factual statement in the lead, it doesn't insinuate that the money is being unfairly distributed.  In fact, every single paragraph after the lead quotes people saying that there's nothing dubious going on and the money is just being distributed by formula.  The piece doesn't quote a single person, not even Sarah Palin, suggesting that there's any monkey business going on here.

But if there's no hanky panky, why bother publishing the story in the first place?  My guess: it's the old problem of reporters not being willing to spike a story when it doesn't pan out.  Brad Heath spent a bunch of time analyzing stimulus spending, but when everyone he called told him there was nothing amiss he just hated the idea of spending all that time and not getting anything out of it.  So he wrote it up anyway, ending up with a nonsensical piece that basically rebuts its own reason for existing.  Dumb.