2011 - %3, March

China's Coal Reserves "Will Make it New Middle East", Says Energy Chief

| Tue Mar. 8, 2011 5:02 PM EST

This post first appeared on the Guardian website.

Vast reserves of coal in the far west of China mean it is set to become the "new Middle East", a leading figure in the global coal industry has claimed. Fred Palmer, the chairman of the London-based World Coal Association and a key executive at Peabody Energy, the world's largest privately owned coal company, also said that China is leading the US in efforts to develop technology to "clean" coal of its carbon emissions by burying them underground.

In a wide-ranging interview with the Guardian, Palmer dismissed the idea that the world might ever experience "peak coal" – the point at which maximum global coal production rate is reached. "The Dakotas, Mississippi, Alabama, Louisiana, Texas all have large, large amounts of lignite [brown coal]," he said. "Or in western China and Mongolia you have lower-ranked coals. So I don't think there's a peak coal problem. I think Xinjiang province in the west of China, where they say there's a trillion tonnes of resources, will be the new Middle East. Anyone who has the notion that we're going to move away from fossil fuels just isn't paying attention."

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Map of the Day: Preventing Students From Voting

| Tue Mar. 8, 2011 4:12 PM EST

This comes from Campus Progress and shows the spread of laws designed to make it harder for college students to vote. Why? Because college students tend to vote for Democrats. The group behind this push, you'll be unsurprised to learn, is funded by all the usual conservative suspects, including everyone's villain du jour, the Koch brothers.

How to Put Wall Street CEOs in Prison

| Tue Mar. 8, 2011 3:59 PM EST

“Forgive me,’’ director Charles Ferguson said in receiving an Academy Award for his documentary Inside Job, "I must start by pointing out that three years after a horrific financial crisis caused by fraud, not a single financial executive has gone to jail — and that’s wrong.''

In New York, Tuesday marked the beginning of the long awaited trial of hedge fund manager Raj Rajaratnam, who ran the $7 billion Galleon Group and whose personal wealth is estimated at $1.3 billion. He is being prosecuted by the SEC for insider trade deals. Rajaratnam is said to have made $45 million in illegal profits. He has denied the charges and is free on $100 million bond. If he is convicted he could go to prison for as long as 20 years. The SEC historically has been such a handmaiden of the finance business that it's hard to imagine anything serious coming out of its prosecutions, but one never knows.

Whatever happens to Rajaratnam, it  would be simple enough to prosecute many of the high rollers on first civil, then criminal charges, fining them millions of dollars and taking them out of circulation for up to 20 years.

"Contrary to prevailing propaganda, there is a fairly straightforward case that could be launched against the CEOs and CFOs of pretty much every US bank with major trading operation," writes Yves Smith in her popular Naked Capitalism blog. "I'll call them 'dealer banks' or 'Wall Street firms' to distinguish them from very big but largely traditional commercial banks.’’ She proceeds to lay out the case, the key points of which I have excerpted below:

Since Sarbanes Oxley became law in 2002, Sections 302, 404, and 906 of that act have required these executives to establish and maintain adequate systems of internal control within their companies. In addition, they must regularly test such controls to see that they are adequate and report their findings to shareholders (through SEC reports on Form 10-Q and 10-K) and their independent accountants. “Knowingly” making false section 906 certifications is subject to fines of up to $1 million and imprisonment of up to ten years; “willful” violators face fines of up to $5 million and jail time of up to 20 years.

The officers in question must certify that, among other things, they "are responsible for establishing and maintaining internal controls" and making sure everyone concerned knows about them--and beyond that, for taking steps to have these controls evaluated and reported. Smith continues:

Education Roundup: Does Class Size Matter?

| Tue Mar. 8, 2011 3:00 PM EST
  • Speaking of ridiculous, an "A" student at a Virginia middle school was recently suspended for opening the door for a visitor who had her hands full. (H/T Boing Boing) Apparently, his actions undermined a district policy that prohibits students from committing random acts of chivalry in entryways, The Tidewater News reports.

House GOPers Looking to Gut Public Housing

| Tue Mar. 8, 2011 2:49 PM EST

Much has been written about the House GOP's 2012 budget bill (HR1), which would cut government spending by $61 billion this year by clamping down on non security-related discretionary spending. One line item that's not getting as much attention: cuts to low-income rental assistance programs for the elderly and the disabled.

A new paper from the Center on Budget and Policy Priorities (CBPP) crunches the numbers on the GOP's plan, which would target some of the most vulnerable Americans, potentially pushing people who are nearly homeless out into the cold. Here are some of HR1's greatest housing hits:

  • $5.4 billion in cuts to the Department of Housing and Urban Development's (HUD) funding for housing and community development programs (12 percent below their 2010 level).
  • Funding for housing vouchers for some 10,000 homeless veterans would be eliminated.
  • $587 million slashed from housing programs for the elderly (a 71 percent reduction).
  • Funding for 4,500 new units per year of housing for low-income seniors and the disabled would be axed.
  • $210 million in funding cuts or housing for people with disabilities (70 percent).
  • Housing vouchers for 14,000 low-income people with disabilities wouldn't be renewed, putting them in danger of losing their homes.

These cuts couldn't come at a worse time. New data from HUD shows that 7.1 million renter households had "worst-case housing needs" in 2009. That means that they received no federal, state, or local housing assistance, earned incomes below 50 percent of the areaS median income, and lived either in severely substandard housing or directed half their income toward housing costs. That 7.1 million figure represents an increase of 20 percent since 2007 and 42 percent since 2001.

Meanwhile, the budget proposal advanced by Senate Democrats—which cuts non-security discretionary spending by $6.5 billion—rejects the House GOP's more draconian measures. It restores $75 million for new housing vouchers for homeless veterans that were cut in HR1. It also boosts funding for homeless assistance grants by $190 million, and rejects the House GOP's cuts to the elderly and disabled. The Senate bill also fully renews funding for Section 8, whose programs in 2010 helped over 3 million low-income households, over half of which were headed by seniors or people with disabilities. To assist the same number of homes in 2011, CBPP recommends boosting Section 8 funding by a little over $100 million.

But that seems unlikely to happen. As the budget battle rages on, one Continuing Resolution extender at a time, it's far from clear how much the Democrats are prepared to push back. 

Fat Tuesday With Feufollet

| Tue Mar. 8, 2011 2:05 PM EST
Courtesy of Feufollet

On Monday, we told you the story of Amede Ardoin, the king of Cajun Zydeco music, who faded from public view in the 1930s after a severe beating at the hands of two white men. Ardoin's legacy lives on in the music of a new generation of young Cajun bands like the Pine Leaf Boys and Feufollet, a Grammy-nominated group from Lafayette, Louisiana. Performing entirely in French, Feufollet blends traditional Cajun music (think fiddles and accordions) with rock-and-roll influences; it's not your father's zydeco, in other words. I spoke with Feufollet's lead singer, Anna Laura Edmiston, about the Cajun dialect, mysterious swamp gases, and what it's like to write songs no one can understand.

Mother Jones: What's the latest song, good or bad, that super-glued itself in your brain?

Anna Laura Edmiston: "I was a landscape in your dream," by Of Montreal. Well, their version of it.

MJ: Three records that you never get sick of listening to?

ALE: Graceland by Paul Simon; Traveling Wilburys' Vol. 1; and Sunshine on Leith, by the Proclaimers.

MJ: If you could bring anyone back from the dead—or borrow them from a living band—for a big jam session, who would it be?

ALE: Oh my gosh. George Harrison. I think he's great. I love his music, and I know everyone else in the band does. Who doesn't like The Beatles? George has just always been my favorite, just because of his creative outlook on things and where he would take material. Plus, I just love his energy and his Zen-ness.

MJ: Anything you listen to but don't exactly like to publicize the fact?

ALE: I guess I like hip-hop. That's like the weirdest thing I listen to, compared to everything else.

MJ: Are there any Cajun rap groups?

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The New 1099 Scam

| Tue Mar. 8, 2011 2:04 PM EST

Do you remember the great 1099 controversy? No matter. Details are here if you're interested, but all that matters is that (a) it raised tax collections on small businesses a bit to fund the healthcare reform act, (b) everybody hates it, and (c) there's a bipartisan consensus to get rid of it.

Fine. With Republicans in charge of the House, they can now write a bill to repeal it, which amounts to passing a tax cut. But guess what? For the first time in living memory, they're insisting that a tax reduction has to be paid for with higher revenue from somewhere else. In particular, they're taking aim at a provision of PPACA that says if you lose your job and get subsidized insurance via the exchange, but then you find a job six months later, you'll get hit with a hefty year-end bill for the months you didn't qualify for a subsidy. This is already bad enough, but at least the maximum payback is fairly modest. The Republican bill would make it much worse, upping the potential payback to multiple thousands of dollars. This is especially punitive for two reasons. First, because the incomes of the poor are highly volatile, which means they're highly likely to get hit with year-end bills. And second, because the total amount of money this raises is minuscule.

Jon Cohn and Ezra Klein have more details, but it's not the details that matter here, it's the principle. Republicans obviously don't believe that tax reductions require offsetting spending cuts, a stand they've made clear time and time again. Nor have they suddenly changed their minds about this. Rather, they're trying to use the 1099 fix as an excuse to undermine the effectiveness of healthcare reform. As Austin Frakt puts it, "ACA's subsidies are starting to function as a cash cow, paying for changes to the law."

Tea party Republicans, now that they're away from the campaign trail and have to face the real world, have discovered that they really don't have any leverage to either repeal or seriously defund PPACA. So now they're trying to find backdoor ways to chip away at it. This one is unusually shameless.

Foreclosure King's Public Company Will Delist

| Tue Mar. 8, 2011 1:50 PM EST

The day after foreclosure attorney David J. Stern announced the closure of his once-powerful law firm, the publicly traded foreclosure processing company he helped create announced plans to delist from the NASDAQ stock market a little over a year after debuting.

In a filing with the Securities and Exchange Commission today, DJSP Enterprises said it will voluntarily drop out of NASDAQ exchange trading by the middle of March. Last winter, the company received notice from NASDAQ that it would be forced to delist unless the company boosted its stock price and maintained a market value of at least $15 million. DJSP's current market capitalization is a measly $2.6 million, and its stock is hovering around 12 cents a share.

A spin-off of all the foreclosure processing operations of Stern's law firm, DJSP's stock opened on the NASDAQ last January at $9.25 a share, with a market capitalization of $300 million. The company's stock then began to climb, peaking at $13.50 a share in late April 2010. But it all went south a month later, when the company disclosed that it had lost a major chunk of business from a top mortgage company. That admission directly contradicted Stern's cheery talk about DJSP, investors said. Feeling duped, multiple investors later sued Stern for securities fraud for misrepresenting DJSP's prospects.

The company's slide only continued throughout 2010, as media reports—including my investigation into Stern's firm, published in August—and a Florida attorney general investigation raised serious questions about the allegedly illegal practices of David Stern's law firm, which was DJSP's primary source of business.

DJSP's stock could still be traded but in off-market venues, according to today's SEC filing. Nevertheless, with the announcement that DJSP is leaving the NASDAQ—presumably before the NASDAQ forcibly delisted the company—the second pillar of Stern's business empire has crumbled. The downfall of DJSP and the Law Offices of David J. Stern, which will shutter by month's end, stands in stark contrast with what Stern told prospective investors just one year ago describing the ongoing foreclosure crisis: "So, yeah, we're in the 2nd inning, but guess what? When we get to the 9th inning, it's going to be a doubleheader and we got a second game coming." Turns out, it's just about game over for Stern.

The Education Beat

| Tue Mar. 8, 2011 1:37 PM EST

In the Columbia Journalism Review today, LynNell Hancock writes about the way the media covers the education beat — often flitting from one silver bullet to the next, driven largely by the agendas of a familiar core of reformers with similar worldviews:

By far the most influential of all are the Big-Three venture philanthropies, The Bill & Melinda Gates Foundation, The Walton Family Foundation, and Eli Broad’s Broad Foundation, which often work in concert on issues like school choice and teacher effectiveness.

....An important story in the Winter 2011 edition of Dissent magazine by Joanne Barkan detailed their influence—amplified by the media—over urban school policy. In it, she quotes conservative education expert Frederick Hess, the nation’s most vocal critic of the media’s “gentle treatment” of the foundations. In the 2005 book, With the Best of Intentions: How Philanthropy Is Reshaping K-12 Education, he describes a credulous press that treats philanthropies like royalty.

What draws these venture philanthropists and Wall Street financiers to urban school reform, and to top-flight charter schools like Uncommon Schools and the Knowledge is Power Program (KIPP) network? One is the businesslike way the schools in those systems are run. They value standardized curricula and measures, incentives, as well as a young, flexible, nonunion teaching force. As a group, these reformers tend to believe that America’s growing child-poverty rate and shrinking social services are used as excuses by educators. Results in schools like those in the KIPP network, they say, prove that poverty does not have to be an obstacle. They see themselves as warriors against the status quo, with leverage. “It’s the most important cause in the nation, obviously,” the manager of hedge fund T2 Partners, Whitney Tilson, told The New York Times in December 2009. “And with the state providing so much of the money, outside contributions are insanely well leveraged.”

The whole thing is worth a read.

Love at First Sight

| Tue Mar. 8, 2011 12:29 PM EST

And now for something completely different. Last night I saw The Adjustment Bureau, and it reminded me of a common problem with modern movies. I'm curious to know if others agree. Don't worry; no spoilers ahead.

The basic premise of the movie is that Matt Damon meets Emily Blunt, falls immediately in love, loses her, and then spends the next several years fighting desperately against the massive and mysterious forces trying to keep them apart. Fine. That's as good a premise for a movie as any. But for it to work, the audience has to believe that Damon's character is really, truly, irrevocably in love with Blunt's. And they have to believe this based on a first meeting that lasts three or four minutes.

You can guess what's coming next: I didn't believe it. Maybe Damon and Blunt just didn't do a good job. Maybe the dialogue in the scene where they first met was unusually clumsy. Maybe it's close to impossible to pull this off in just a few minutes of screen time, and it's one of those things you have to accept as a premise without really believing it, like light sabers, or the notion that Katherine Heigl has a hard time attracting men.

But anyway, I'm curious: anyone else feel that movies routinely fail to pull off this kind of first act chemistry these days? Did they really do it better in the past? It seems like they did, but I'm not enough of a movie buff to say so with any conviction. What say ye, commentariat?

UPDATE: And the movie overall? Meh. I've seen worse. But you can wait for it on Netflix.

UPDATE 2: And how many movies have now been made from Philip K. Dick novels or short stories? According to his Wikipedia entry, nine. Is that some kind of record?

UPDATE 3: What's more, according to Wikipedia, there's a French film based on my favorite Dick novel, Confessions of a Crap Artist. I had no idea. It's called Barjo in its English-language release. Doesn't seem to be available from Netflix, though.