2011 - %3, December

A Fat Cat Explains Basic Economics

| Thu Dec. 1, 2011 3:52 PM EST

Zillionaire venture capitalist Nick Hanauer says his marginal propensity to consume is lower than mine:

Since 1980, the share of the nation’s income for fat cats like me in the top 0.1 percent has increased a shocking 400 percent, while the share for the bottom 50 percent of Americans has declined 33 percent. At the same time, effective tax rates on the superwealthy fell to 16.6 percent in 2007....In my case, that means that this year, I paid an 11 percent rate on an eight-figure income. 

One reason this policy is so wrong-headed is that there can never be enough superrich Americans to power a great economy. The annual earnings of people like me are hundreds, if not thousands, of times greater than those of the average American, but we don’t buy hundreds or thousands of times more stuff. My family owns three cars, not 3,000. I buy a few pairs of pants and a few shirts a year, just like most American men. Like everyone else, I go out to eat with friends and family only occasionally.

....I can’t buy enough of anything to make up for the fact that millions of unemployed and underemployed Americans can’t buy any new clothes or enjoy any meals out. Or to make up for the decreasing consumption of the tens of millions of middle-class families that are barely squeaking by, buried by spiraling costs and trapped by stagnant or declining wages.

If the average American family still got the same share of income they earned in 1980, they would have an astounding $13,000 more in their pockets a year. It’s worth pausing to consider what our economy would be like today if middle-class consumers had that additional income to spend.

The rest is worth a read. We need entrepreneurs, but we need a thriving middle class even more. Washington DC's centrist punditocracy needs to have this pounded into their skulls.

(Via Jared Bernstein.)

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Ask For More!

| Thu Dec. 1, 2011 3:18 PM EST

E.J. Graff asked all the men to leave the room before she linked to this reddit piece below, but I didn't. It's from an HR person at a tech company explaining why women routinely get lower salary offers than men:

The reason they don't keep up, from where I sit, is simple. Often, a woman will enter the salary negotiation phase and I'll tell them a number will be sent to them in a couple days. Usually we start around $45k for an entry level position. 50% to 60% of the women I interview simply take this offer. It's insane, I already know I can get authorization for more if you simply refuse. Inversely, almost 90% of the men I interview immediately ask for more upon getting the offer.

The next major mistake happens with how they ask for more. In general, the women I have negotiated with will say 45k is not enough and they need more, but not give a number. I will then usually give a nominal bump to 48k or 50k. Company policy wont let me bump more than 5k over the initial offer unless they specifically request more. On the other hand, men more frequently will come back with a number along the lines of 65k to 75k, and I will be forced to negotiate down from there. After this phase, almost all women will take the offer or move on to somewhere else, not knowing they could have gotten more if they asked.

At the end, most of the women I hire make between 45k and 50k, whereas the men make between 60k and 70k. Even more crazy, they ask for raises far less often, so the disparity only grows.

I apologize for sticking around, but there's a reason. I've run into this before myself, and have always told women "Just ask! The worst that can happen is that they say no." But that's not actually the case. Here's a bit of research on the subject:

Their study...found that women's reluctance [to negotiate] was based on an entirely reasonable and accurate view of how they were likely to be treated if they did...."What we found across all the studies is men were always less willing to work with a woman who had attempted to negotiate than with a woman who did not," Bowles said. "They always preferred to work with a woman who stayed mum. But it made no difference to the men whether a guy had chosen to negotiate or not."

So listen up, boys: there's a reason women don't negotiate as hard as men. Several of them, in fact. But one of these reasons is that men treat them shabbily when they do. So knock it off. Tell the women you love to negotiate the same as you would, and when they do, don't hold it against them. OK?

ACLU Corrects Citation To Non-Islamophobic Essay

| Thu Dec. 1, 2011 2:20 PM EST
State Department counterterrorism adviser Will McCants

The ACLU, which has been challenging the federal government's use of anti-Muslim materials in counterterrorism training, acknowledged on Thursday that one of the sentences in an essay the group had cited as Islamophobic earlier this week was taken out of context. 

"We stand by the broader points we make in our analysis, including that the textbook contains deeply problematic materials, but we shouldn't have cited to this specific essay in support of those broader points," ACLU Policy Counsel on National Security, Immigration and Privacy Mike German wrote. "The citation focused on a portion of the conclusion, without properly taking into account the content that came before it. We are removing the citation of this essay from our earlier analysis and are updating our blog to reflect that change. We regret the error."

The essay in question was written by former State Department counterterrorism adviser Will McCants in a training textbook produced by the FBI and the Combating Terrorism Center at West Point. The ACLU had described the essay as an example of training materials that "falsely portray American Muslim and Arab communities as monolithic, violent and supporters of terrorism." McCants' essay had actually been making the opposite point.

That textbook, Terrorism & Political Islam: Origins, Ideologies, and Methods did contain some questionable material, such as the suggestion that opposition to the war in Iraq could be a sign of Islamic militancy. Good on the ACLU for correcting the record, which is something the fearmongers they're criticizing will probably never do. 

Ayotte's Torture Amendment Is Kaput

| Thu Dec. 1, 2011 2:13 PM EST
Sen. Kelly Ayotte (R-N.H.).

Repealing restrictions on torture: It's the moderate, centrist thing to do.  

On Wednesday afternoon, Senator Kelly Ayotte (R-N.H.) took to the Senate floor to defend her amendment revoking President Obama's 2009 executive order restricting American interrogators to the techniques outlined in the Army Field Manual.  "Our amendment in no way condones or authorizes torture," Ayotte said, insisting the secret annex to the Army Field Manual her amendment would have created would still have abided by domestic and international prohibitions against torture. Ayotte also said that interrogations were being undermined by the fact that the Army Field Manual on interrogation is available on the Internet. we're just telegraphing to our enemies that we're going to use."

But as Ayotte tried to rebut criticisms that her amendment would open the door to torturous interrogation techniques, she engaged in a conversation with the amendment's co-sponsors that undermined her argument.  

"When a member of Al Qaeda or a similar associated terrorist group, I want to them to be terrified about what's going to happen to them in American custody," said Senator Joe Lieberman (I-Conn.), explaining his support for the amendment. "I want them not to know what's going to happen, I want that the terror that they inflict on others to be felt by them as a result of the uncertainty that they can look on the Internet and know exactly what our interrogators are limited to." In an exchange with Senator Lindsey Graham (R-S.C.), Ayotte acknowledged that part of her goal was to reauthorize some Bush-era "enhanced interrogation techniques" other than waterboarding. 

The Semiotics of Emma Sullivan

| Thu Dec. 1, 2011 2:05 PM EST

I'm so late to this story that I might as well be blogging about the evils of the tin trust or something, but there's an aspect of the whole Emma Sullivan story that I don't get. Emma Sullivan, of course, is the Kansas teenager who went on a field trip to the state capitol, listened to some remarks from Governor Sam Brownback, and tweeted:

Just made mean comments at gov. brownback and told him he sucked, in person #heblowsalot.

The governor's staff went ballistic, Sullivan's school principal demanded she apologize, the governor and the principal eventually backed down, Sullivan became an internet hero for a few minutes, and Ruth Marcus was appalled. "If you were my daughter," she wrote in the Washington Post, "you’d be writing that letter apologizing to Kansas Gov. Sam Brownback for the smartalecky, potty-mouthed tweet you wrote after meeting with him on a school field trip."

But forget all that for a moment. Forget the overreaction from the authorities, Sullivan's unlikely stardom, or Marcus's fainting couch performance. What I'm curious about is this: does anybody seriously have a problem with a teenager saying that somebody sucks? Or blows? That doesn't even qualify as crude language these days, let alone foul language, does it? It's just everyday teenager language. Am I mistaken to think that you could say something sucks in a high school classroom and not even get a titter, let alone a smackdown from most teachers? What am I missing here?

Barack Obama Has, on Average, Attended a Fundraiser Every 5 Days in 2011

| Thu Dec. 1, 2011 1:30 PM EST

On Wednesday, President Obama zipped up to New York City to attend three different fundraising events. Occupy Wall Street protesters greeted the president outside the Sheraton New York, the site of one of Obama's fundraisers, though New York police officers kept the demonstrators penned in what NYPD called "frozen zones." (More on that here.)

But perhaps the most interesting item to come out of Obama's New York swing was this statistic, via CBS News' Mark Knoller:

Sixty-nine fundraisers this year by December 1. That's an average of more than one fundraiser every five days. (Though, as Obama's latest Big Apple trip shows, these events are often clustered together on a single day.) This is a blistering pace of rainmaking for the 44th president in 2011.

Obama's fundraising activity surpasses that of predecessors George W. Bush and Bill Clinton. According to Brendan Doherty, a political scientist at the US Naval Academy, Bush attended 41 fundraisers between January 1, 2003 and November 30, 2003. Clinton attended 23 fundraisers from January 1, 1995 and November 30, 1995.

Here's that comparison in chart form:

Prof. Brendan Doherty, US Naval Academy; Mark Knoller, CBS NewsProf. Brendan Doherty, US Naval Academy; Mark Knoller, CBS News

Obama is not on the money trail because he enjoys hotel ballrooms and posing for pictures with 1-percenters. The president's ramped-up fundraising efforts reflect the changing landscape of money in American politics, especially in the wake of the Supreme Court's Citizens United decision. Clinton and Bush II didn't have to worry about candidate-specific super-PACs and Karl Rove's shadowy Crossroads GPS outfit raising tens of millions of dollars to finance negative ads. And with the collapse of the presidential public financing system, which capped a candidate's spending, it's up to the candidates to rustle up as much private money as they can in the campaign arms race. (Obama opted out of the public financing system during the 2008 election, becoming the first presidential candidate to do so.)

Obama's fundraising has more than paid off. The president has raised nearly $90 million so far—but with a significant 46 percent of it from small donors—for his reelection effort, according to the Center for Responsive Politics. The next highest fundraiser in the 2012 presidential field is Republican Mitt Romney, who has raked in $32.2 million.

Obama's pace exceeds his own fundraising in the early stages of his first presidential run, in 2007. Through September 30, 2007, Obama had raised $80 million; this time around, that figure was $88 million through September 30. As the president, he does have the full backing and fundraising muscle of the Democratic National Committee, which is scouring the country for every dollar and every volunteer it can find to power Obama through what's shaping up to be one of the most bruising, cash-drenched campaigns in history.

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Boeing Makes Peace With Its Unions

| Thu Dec. 1, 2011 12:58 PM EST

Republicans have been making hay for months over the NLRB's decision to consider a complaint from one of Boeing's unions about their decision to build the 787 Dreamliner in a shiny, new, non-union plant in South Carolina. The union believed this decision was made in retaliation for past strikes — something that would be illegal — and they believed this because Boeing CEO Jim Albaugh practically bragged about it in public interviews. Nonetheless, Republicans were apoplectic over the union's decision to challenge a move they believed was made illegally, and they were doubly apoplectic over the gall of the NLRB in allowing the challenge to go forward. Apparently they should have simply been told to pound sand instead of being given a hearing on the merits of the case. GOP leaders in the House introduced a bill in September to strip the NLRB of its authority in cases like this, and a few weeks later Rick Perry thundered that the NLRB had "undermined our free-market system." (In front of a South Carolina audience, of course.)

Yesterday, though, Boeing took away the GOP's lollipop:

The deal announced Wednesday between Chicago-based Boeing and the International Association of Machinists & Aerospace Workers, if ratified by union members, would help pave the way for a planned jump in production by the aerospace giant. It would alleviate the threat of strikes that could derail ambitious sales plans for a retooled version of Boeing's best-selling 737 aircraft, its new 787 Dreamliner and other jets.

Under the deal, Boeing said it will build the 737 Max, the retooled version, at a union plant in Renton, Wash. Boeing previously had said that work could go to another state, sparking anger from labor leaders and intense lobbying by politicians in Washington and elsewhere. In exchange, union leaders said that if their members approve the new deal, they will drop their opposition to Boeing's use of a new, nonunion plant in South Carolina to assemble some Dreamliners.

Hey, collective bargaining! I guess it works after all.

Bachmann Is Right About That Iran Embassy, Sorta

| Thu Dec. 1, 2011 12:14 PM EST

Outside the former US embassy in Iran: Ninara/FlickrOutside the former US embassy in Iran. Ninara/Flickr

Okay, you've probably heard by now about Michele Bachmann's latest ride on the gaffe train: Talking to supporters in Waverly, Iowa, Wednesday afternoon, the firebrand congresswoman declared that if she were elected president, "we wouldn't have an American embassy in Iran." As just about everyone in the press corps promptly pointed out, the US hasn't had a diplomatic presence in Tehran since 1979, when there was this little Shi'ite revolution thing, and workers at the US embassy were held hostage for a year by Iranian students sympathetic to the new revolutionary government.

But...what if we give Bachmann the benefit of the doubt? There is, after all, still a building that used to be the US embassy in the Iranian capital. It's reportedly now a museum dedicated to American terribleness—according to Lonely Planet, this "US Den of Espionage" is No. 35 on the list of top 95 things for tourists to see in Tehran.

So perhaps Bachmann meant what she said. Perhaps she meant that, if she sits in the Oval Office, there'd be no ex-embassy-cum-anti-American museum in the Islamic Republic of Iran...because there'd be no Islamic Republic of Iran. Just a thought.

If so, Bachmann's actually on the cutting edge of international relations theory: In one short statement, she's managed to simultaneously construct a national security threat and deconstruct it by predicting its annihilation. Political scientists, let's call this exciting new process "threat derationalization."

[Update: A damage-control statement by the Bachmann campaign insists that the congresswoman was "speaking in the hypothetical." So much more comforting.]

Buddy Roemer to Seek Nomination Through Dark Money-Fueled Group

| Thu Dec. 1, 2011 12:06 PM EST

Republican presidential long shot Buddy Roemer is throwing his lot in with Americans Elect, the weird, not-actually-a-third-party-but-come-on political group I wrote about last week. The group's catchy sell: it will allow registered voters to select a presidential nominee over the internet.

Roemer's announcement, via Dave Weigel:

Today I officially announce that I will seek the Americans Elect nomination as a proud Republican but as an even prouder American.

Our country is on the wrong track and Americans are in search of real leadership. Leadership that isn't predetermined by lobbyists, political parties, or Wall Street executives, but leadership that is free to do what is right for the citizens of our great nation.

Many Americans are unemployed or without health insurance, or both. Some have been foreclosed on or about to be foreclosed on. Sadly, the list goes on and on. From the Tea Party movement to the Occupy Wall Street movement, it is safe to say Americans have lost faith in their government and neither President Obama nor Congress have put aside politics in order to help their fellow Americans.

I will take my message of ending business as usual in Washington directly to the American people. No other candidate is free from the special interests or has the experience I have. I am a former governor, four-term congressman, successful businessman and Harvard-educated economist. And yet, the Republican Party has not allowed me in the debates. Perhaps they don't like my message about the corrupting influence of money in politics. But, I believe the American people want to hear the message, so I'm going to seek the nomination of Americans Elect which appears eager to welcome diverse and controversial opinions that may upset the status quo.

I will continue to campaign for the Republican nomination and hope to surprise everyone on January 10 in New Hampshire.

Americans Elect wants to upend the political process by allowing registered voters to nominate a presidential ticket that's beholden to neither party. But it has come under heavy scrutiny for its a shadowy bureaucratic hierarchy and refusal to disclose its donors. How that latter piece squares with Roemer's criticism of the current, broken campaign finance system is unclear.

UK Crematorium to Generate, Sell Energy Made From Dead People

| Thu Dec. 1, 2011 11:08 AM EST
"Elmo now sustainable energy."

If there was ever a reason for everything in the United Kingdom to suddenly become haunted, this is it:

This week, Durham Crematorium announced plans to install turbines in two of its burners, which, using heat generated during cremation, could produce enough electricity to power "1,500 televisions," the Telegraph reports. The turbines—part of the crematorium's £2.3 million (US $3,611,920) furnace replacement project—would run on the steam that comes from cooling the intensely hot gasses used for cremation. Durham could then sell off the electricity to the UK's National Grid and receive compensation from energy companies under the "feed-in tariffs" program, while using a third burner to heat the offices and chapel. Crematoria across the country are expected to follow Durham's efficient lead.

Just to be clear, cremation is that thing you do when you want to burn dead people to crispy, funeral-ready ash. This means that all that harnessed energy—for the chapel, the offices, the interconnected power stations—would technically be made from corpses. You could think of this as Sweeney Todd, but for alternative-energy enthusiasts. It might even sound eerily reminiscent of a 2001 Japanese cult film where poltergeists destroy human civilization after entering our world via modern technology.

Dark stuff, huh?

Actually, once you get over the macabre elements, it's kind of a good idea that sponsors promise will be carried out with utmost transparency. Durham Crematorium, run by the county council, will host several "open days" in an attempt to drum up broad public support for the plan. (Similar projects have enjoyed community support in areas such as the city of Halmstad in Sweden.)

"If there is genuine spare capacity to generate electricity then we are certainly interested in investigating that [and] if it was thought to be acceptable in the eyes of the public we would almost certainly pursue that," Alan José, superintendent at Durham Crematorium, said in an interview with the Telegraph. "Apart from it being common sense for us to try to conserve energy, it also enables us to keep the fees down...We don't want to become known as a power station rather than a crematorium because we try to provide a reverend and decent place for people to have a cremation service."

Due to the UK's ever-rising electricity costs—plus the fact that over 70 percent of the country's dead end up getting cremated, anyway—it's probably safe to assume that this trend will continue picking up steam. But the success of this type of program ultimately depends on how uneasy people get when faced with the possibility that their electric foot massager might be powered by recently departed grandpa.