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Quote of the Day: Vulture Fund Suing Argentina Is Just a Lonely Defender of the Free Market

| Thu Jul. 31, 2014 10:24 AM EDT

Here is fellow hedge fund manager Daniel Loeb defending Paul Singer, the billionaire owner of the vulture fund that successfully forced Argentina into default because it was insisting on full payment for old Argentine bonds:

He doesn’t get into fights for the sake of fighting. He believes deeply in the rule of law and that free markets and free societies depend on enforcing it.

You betcha. Anytime a Wall Street tycoon is supposedly fighting for deep principles, hold onto your wallet. They don't become billionaires because of their deep commitment to fair play and the unfettered operation of capital markets. However, there's also this:

The big question, however, is whether Argentina will ever pay Elliott what it wants. If the firm fails to collect, that would underscore the limits of its legal strategy. There is no international bankruptcy court for sovereign debt that can help resolve the matter. Argentina may use the next few months to try to devise ways to evade the New York court. Debt market experts, however, do not see how any such schemes could avoid using global firms that would not want to fall afoul of Judge Griesa’s ruling.

This is an interesting point. Normally, Argentina would just continue to pay the holders of its "exchange" bonds and refuse to pay the vulture funds that refused to go along with the terms of its bankruptcy and restructuring a decade ago. Elliott and the other vultures would be out of luck. The problem is that Argentina's payments are funneled through a US bank, and the judge in the case has forced US banks to halt payments.

But in all the articles I've read about this, I've never really seen an adequate explanation of why it's so impossible to avoid funneling payments through the US. I get that Argentina can no longer use an American US bank. Also, I assume, they can't use a big global bank that does business in the US. But surely there are mid-size banks that do no business in the US that could act as payment agents? If dollars were the issue, they could pay off in euros instead. I don't know what it would take legally for Argentina to switch either payment agents or the denominations of its bonds, but it doesn't sound impossible. And yet apparently it is. Why?

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Gaza Conflict Divides Congressional Progressives

| Thu Jul. 31, 2014 9:22 AM EDT
Rep. Keith Ellison (D-Minn.), left, and Rep. Brian Baird (D-Wash.) survey the rubble of the American International School in Gaza in 2009.

With the war in Gaza continuing without an end in sight, congressional leaders are rallying to condemn Hamas rocket attacks and support Israel. But members of the Congressional Progressive Caucus have been divided over the conflict, with some commending Israel's military for its use of precision weapons and others outraged by the conflict’s mounting Palestinian civilian causalities. 

The division was clear on July 29 when caucus co-chair Rep. Keith Ellison (D-Minn.), who has visited Gaza three times since 2009 and previously condemned the Israeli blockade of Gaza, published an op-ed in the Washington Post that highlighted recent Palestinian civilian casualties—including four children who were "blown up on a beach" by an Israeli attack. He noted that most Gaza residents "aren't rocket shooters or combatants. For the past several years they have lived in dreadful isolation. The status quo for ordinary Gazans is a continuation of no jobs and no freedom." Ellison again called for an end to Israel's blockade and urged Hamas to give up its rockets: "There is no military solution to this conflict. The status quo brings only continued pain, suffering and war."  

Yet this is not the consensus view within the 65-member Progressive Caucus that Ellison co-leads. In recent weeks, other caucus members have focused on the rocket attacks launched against Israel and lent their support to its aggressive military reaction.

Toward the start of Israel's air campaign in Gaza, Rep. Jerrold Nadler (D-N.Y.), a stalwart liberal representing Manhattan's Upper West Side, issued a statement condemning Gaza's rocket attacks and calling for the public to support Israel "to take whatever measure she deems necessary to defend the population against the attempted murder by these terrorists." Nadler attended a rally in front of New York's city hall with other prominent New York Democrats to express support for Israel's actions in Gaza. Two days later, on July 16, caucus member Rep. Lois Frankel (D-Fla.) issued a statement with Rep. Ted Deutch (D-Fla.) calling for solidarity with Israel.

"Israel has gone far beyond what we have seen any other country do trying to protect the civilian population of its enemy," Nadler said. Frankel and Deutch similarly praised the Israeli military for using "pinpoint technology to minimize any collateral damage." So far more than 800 Palestinian civilians, including 232 children, have been killed by Israeli strikes in Gaza as of July 30.

Last week, Progressive Caucus member Jim McDermott (D-Wash.), a psychiatrist by training, condemned Israel’s attacks on hospitals. "The proximity of military targets or the suspicion of hidden weapons and militants is an invalid excuse in the targeting of a hospital or ambulance," he said in a statement.

"You should not be put in danger in a medical situation by someone alleging that there's some reason they should attack a hospital or doctor," he tells Mother Jones

On July 18, Ellison and five other representatives—all progressive caucus members—signed a letter to President Obama and Secretary of State Kerry calling for the White House and the State Department to "redouble your efforts" to press for a cease fire in Gaza. Contrast that to 2009, when 54 House Democrats signed a letter drafted by Ellison and McDermott urging the president "to work for tangible improvements to the humanitarian concerns" in Gaza. 

As for Rep. Raul Grijalva (D-Ariz.), who co-chairs the caucus with Ellison, he has not said much publicly about the current war in Gaza. Although he signed the 2009 letter, he did not lend his name to the July 18 call for a cease fire. His office did not respond to requests for comment.

British Army Officially Withdrew From Northern Ireland 7 years Ago [Photos]

| Thu Jul. 31, 2014 6:00 AM EDT

After 38 years, Operation Banner–Britian's operation in Northern Ireland–officially came to an end on July 31st, 2007. It was initially sold in 1969 as a "limited operation" by British Home Secretary Jim Callaghan but wound up being the longest continuously running operation by the British military.

A female catholic screams at a British soldier in Belfast on August, 14, 1989. AP
 
A burnt out digger blocks a road near the Albertbridge Road in east Belfast, Northern Ireland, Monday, Sept. 12, 2005. Protestant extremists attacked police and British troops into a third day Monday, littering streets with rubble and burned-out vehicles in an orgy of violence sparked by anger over a restricted parade. Crowds of masked men and youths confronted police backed by British troops in dozens of hard-line Protestant districts in Belfast and several other towns. Gunmen opened fire on police and soldiers in at least two parts of the capital Sunday night, but nobody was hit. Peter Morrison/AP
 
A young child, resting on a man's shoulders, holds a hanging effigy of a British soldier during a march in Belfast, capital of Northern Ireland, Feb. 1972. The rally follows the deadly shooting of 13 demonstrators by British paratroopers during the civil rights march on Jan. 30, known as Bloody Sunday. Michel Laurent/AP
 
A British soldier begins work on taking down a British Army watchtower in South Armagh, Northern Ireland, Monday, Aug. 1, 2005. Security is being downgraded and spying watch posts on hills are being removed after the recent statement by the Irish Republican Army (IRA) that they were giving up the armed struggle for a united Ireland. Peter Morrison/AP

 

Film Review: "15 to Life"

| Thu Jul. 31, 2014 6:00 AM EDT

15 to Life

HITPLAY PRODUCTIONS

"Are you the same person that you were at age 14?" one of Kenneth Young's lawyers asks in 15 to Life, a documentary challenging the ethics of sentencing kids to life in prison—a routine punishment only in America. Filmmaker Nadine Pequeneza follows Young, charged with four armed robberies as a teen, as he seeks release in the wake of a 2010 Supreme Court decision limiting juvenile life sentences to kids convicted of murder. She weaves interviews with Young and his family, lawyers, and crime victims together with harrowing photographs of youthful inmates to depict a justice system that only perpetuates the sort of violence it was intended to keep in check.

This review originally appeared in the July/August 2014 Issue of Mother Jones.

Republicans About to Blow Up Emergency Border Crisis Funding

| Thu Jul. 31, 2014 1:07 AM EDT

The Obama administration is—once again—being forced to go into crisis mode to keep the government functioning because Republicans refuse to do their most basic job: appropriating money to deal with emergencies. This time it's for the refugee disaster on the border:

Border agencies say their existing budgets — sapped by added costs from overtime, detention and transportation for the children, more than 57,000 of whom have arrived since October — will start running dry before lawmakers get back in September.

Administration officials warn that the price of congressional inaction will be steep, estimating the cost of caring for each immigrant youth runs between $250 and $1,000 a day.

"Scary," Sen. Richard J. Durbin of Illinois, the No. 2 Democrat, said about the agencies' budget outlook.

On Wednesday, officials at the Office of Management and Budget were putting together plans to scrounge up funds. But without congressional approval, President Obama is limited to moving around money only in small amounts. That probably means the redistribution will touch many different programs — a distressing prospect for officials in vulnerable agencies.

So why is it that Republicans can't agree on even a minimal stopgap funding bill? Because Ted Cruz is grandstanding again:

“The Obama White House should put Ted Cruz on the payroll,” said Rep. Peter T. King (R-N.Y.), a vocal Cruz opponent. “We have a chance to pass a good bill, not a perfect bill. Boehner is working hard to get to 218 votes and yet there is Ted Cruz, telling us to do nothing. If he wants to come over and run for speaker, that’s fine, but otherwise he should stay over there in the Senate.”

....At a conference meeting Tuesday, Boehner announced that he would pare down his initial framework after hearing numerous complaints about its size and scope....But Steve King, Gohmert and Salmon — along with Cruz and others — want House Republicans to defund Obama’s Deferred Action for Child Arrivals program, which has granted temporary relief for some children of illegal immigrants and is set for renewal this fall. Boehner has resisted the idea. But late Wednesday, GOP aides said that leaders were likely to allow a vote on a standalone bill that would defund DACA before voting to approve the border spending measure. If the bill to defund DACA were to pass, it wasn’t clear exactly how House leaders would merge the two proposals and send them to the Senate.

Basically, Cruz is trying to rally House conservatives to vote against Boehner's stopgap bill unless it also kills DACA, the so-called mini-DREAM executive action that halts deportations of children who have been in the country for many years. If he succeeds, then no funding bill will pass before Congress goes on vacation. That's why the Obama folks are in crisis mode. We can't just starve the kids who have come across the border, after all, and that means Obama is once again forced to be the grown-up in the room.

Your Republican Party at work, folks. George Washington would be proud.

Watch: UN Agency Spokesman Breaks Down In Tears While Talking About Gaza School Bombing

| Wed Jul. 30, 2014 9:07 PM EDT
Women mourn after an attack on a UN-run school in Gaza July 24.

United Nations Relief Works Agency spokesman Chris Gunness has been talking to media outlets around the world about the situation in Gaza, "advocating passionately," as he puts it, "for Palestine refugees to enjoy all their rights to the full, including the right to a just and durable solution." Gunness' agency runs schools in Gaza that are being used as shelters by Palestinian families and have been attacked six times in the current conflict (the Israeli military says it has found rockets in the schools on occasion). On Wednesday he was talking to an Al Jazeera interviewer about the most recent school bombing, which reportedly left 15 dead. "The rights of Palestinians, even their children, are wholesale denied, and it's appalling," he said before breaking into tears. Watch:

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LA's Crappy Old Pipes Mean More Epic Floods Are Coming

| Wed Jul. 30, 2014 6:38 PM EDT
Workers respond to the broken water main in Los Angeles.

Yesterday at around 3:30 pm, a water main burst near the campus of UCLA in the Westwood neighborhood of Los Angeles. It gushed for nearly three hours, sending water as high as 30 feet into the air and flooding campus—cars' wheels were submerged, the brand-new basketball court was covered in standing water, eager students brought boogie boards. As much as 10 million gallons are estimated to have been lost, at a rate of 38,000 gallons per minute.

We're Still at War: Photo of the Day for July 30, 2014

Wed Jul. 30, 2014 1:17 PM EDT

The USS George Washington conducts flight operations east of Okinawa. (US Navy photo by Mass Communication Specialist 3rd Class Beverly J. Lesonik.)

Fast-Food Workers Just Took McDonald’s Down a Notch

| Wed Jul. 30, 2014 12:55 PM EDT

On Tuesday evening, the federal government dealt a huge blow to McDonald’s, which has for over a year and a half been the target of worker protests and lawsuits over its low wages and questionable labor practices.

McDonald’s has long maintained that as a parent company, it cannot be held liable for the decisions individual franchises make about pay and working conditions. On Tuesday, the general counsel at the National Labor Relations Board (NLRB) ruled that this is nonsense, saying that the $5.6 billion company is indeed responsible for employment practices at its local franchises. That means that the company is no longer shielded from dozes of charges pending at regional NLRB offices around the country alleging illegal employment practices.

"McDonald’s can try to hide behind its franchisees, but today’s determination by the NLRB shows there's no two ways about it," Micah Wissinger, an attorney who brought a case on behalf of New York City McDonald's workers said in a statement Tuesday. "The Golden Arches is an employer, plain and simple."

The Fast-Food Workers Committee along with the Service Employees International Union has filed numerous complaints against the company with the NLRB since November 2012. Most recently, workers filed seven class action lawsuits against McDonald’s corporate and its franchises in three states alleging wage theft. The NLRB consolidated all these complaints into the case it decided on Tuesday, which focused on whether McDonald's corporate can be considered as a "joint employer" along with the owner of the franchise.

Since the fall of 2012, fast-food workers at McDonald's, Burger King, and KFC franchises around the country have been striking to demand a $15 minimum wage and the right to form a union without retaliation. The strikes recently went global. Organizers say Tuesday's ruling will lend workers new momentum in their ongoing battle against the fast-food mega-chain.

Lucy and the Great 10% Myth

| Wed Jul. 30, 2014 11:44 AM EDT

Andrew Sullivan reminds me of something I was curious about the other day. He quotes Jeffrey Kluger, who writes in Time that he's annoyed with the movie Lucy because it perpetuates the ridiculous myth that we only use 10 percent of our brains. I sympathize. I was sort of annoyed just by seeing that in the trailer. But it did make me wonder: where did this urban legend come from, anyway? Wikipedia to the rescue:

One possible origin is the reserve energy theories by Harvard psychologists William James and Boris Sidis...William James told audiences that people only meet a fraction of their full mental potential....In 1936, American writer Lowell Thomas summarized this idea...."Professor William James of Harvard used to say that the average man develops only ten percent of his latent mental ability."

In the 1970s, psychologist and educator Georgi Lozanov, proposed the teaching method of suggestopedia believing "that we might be using only five to ten percent of our mental capacity."....According to a related origin story, the 10% myth most likely arose from a misunderstanding (or misrepresentation) of neurological research in the late 19th century or early 20th century. For example, the functions of many brain regions (especially in the cerebral cortex) are complex enough that the effects of damage are subtle, leading early neurologists to wonder what these regions did.

Huh. So we don't really know for sure. That's disappointing but not surprising. It's remarkable how often we don't know where stuff like this comes from.

As for its continuing popular resonance, I have a theory of my own. There are an awful lot of people out there with remarkable—and apparently innate—mental abilities. They can multiply enormous numbers in their heads. They can remember every day of their lives. That kind of thing. And yet, they operate normally in other regards. The fact that they've stored, say, distinct memories of the past 15,000 days of their lives doesn't seem to take up any cerebral space or energy that they needed for anything else. So surely all that storage and retrieval capacity is just sitting around unused in the rest of us?

No, it's not. But the idea resonates because freakish mental skills seem to be so much further out on the bell curve than freakish physical skills. It makes the whole 10 percent thing seem pretty plausible. And that's why it sticks around.

POSTSCRIPT: Or does it? I mean, has anyone tried to find out how many people still believe this myth? For all I know, everyone has long been aware that it's not true. We need a poll!