Pensions for the World's Poor

At the G20 summit that concluded last week, the world’s leading economic powers made what looked like a generous commitment to poorer nations: $1 trillion to help the developing countries weather the economic crisis, which will drive an estimated 50 million more people into dire poverty. But as Robert Weissman writes on the Huffington Post today, the apparent largesse might not be all it seems.

To begin with, the $1 trillion figure is overstated, and much of the funding is in the form of loans. Even more importantly, Weissman argues:

The entire purpose of the G20’s assistance may be thwarted by the institution through which the G20 countries chose to channel most of the money: the International Monetary Fund (IMF). The logic of providing assistance to developing countries is to help them adopt expansionary policies in time of economic downturn. Yet the IMF is forcing countries in financial distress to pursue contractionary policies–exactly the opposite of the stimulative policies carried out by the rich countries (and supported by the IMF, for the rich countries).

For decades now critics have excoriated the IMF for lending policies that tie financing to a country’s willingness to tighten its belt by cutting social programs, and pursuing a program of financial deregulation, privatization, and foreign investment–precisely the sorts of policies that created the financial mess in the first place, and precisely the kinds of changes will make suffering in the developing world even worse. The IMF says it is changing its approach–but as Weissman points out, Congress can hold them to this dubious claim by attaching conditions to U.S. funding. 

One eminently practical suggestion for how some of this funding might be used comes from HelpAge International, a grassroots organization focused on the needs of older peoples of the world. HelpAge argues that to be effective, development policy “must respond to the intergenerational nature of poverty and to rapid population ageing.” As the G20 meeting concluded, HelpAge urged that funds be provided ”to build social security schemes that put money directly into the hands of the world’s poor and deliver long-term income security.’’

More than three quarters of the world’s population has no access to anything resembling social security. That includes 100 million people living on less than $1 a day. The economic downslide makes their survival even more tenuous.  As HelpAge argues:

Coachella Preview: Rock

The tenth installment of America's hottest music festival is only one week earlier than usual this year, but it sure feels like it snuck up on me. Holy palm trees, it’s this Friday, and I'm not ready! I need to get new crazy-colored board shorts, hipster vintage T-shirts, and decide on a poolside cocktail! More than anything, though, any festival attendee with a serious interest in music needs to start planning early, picking priorities from the cornucopia of quality acts. For the next three days I’ll take a look at the lineup, splitting things up into admittedly imperfect “rock,” “hip-hop” and “electronic” categories, for lack of a better idea. Today: rock.

Clarence Thomas Is One Seriously Troubled Dude

This New York Times article on a rare public appearance by Justice Clarence Thomas -- a talk with high school essay contest winners -- is enough to make you feel sorry for the poor schmuck, if he wasn't on the most powerful court in the land and thus able to place the imprint of his neuroses and obvious self-loathing on the legacy of American jurisprudence.

The article makes clear, simply by quoting the famously taciturn Thomas, that he believes he is dumber than all the other justices and a good number of law professors, and retreats into isolation ("I tend to be morose sometimes") to nurse his wounds and brood. What an awful purgatory of an existence: to know you are a fraud, to know that everyone else knows you are a fraud, and yet to be locked into your job more or less for life. It's enough to ruin a person. And it appears it has.

Feminism and Domestic Violence

The debate rages at Slate's XX Factor. The indomitable Linda Hirshman lit a fire with her piece on 'blaming' the victims of domestic violence for not leaving sooner. She uses two books to make the point that it's entirely appropriate to ask the question that so many feminists consider verboten, switching the onus from batterer to batteree. Of Leslie Morgan Steiner's new memoir of four years in an abusive relationship, Crazy Love, and Katha Pollitt's Learning to Drive: And Other Life Lessons about marriage to an epic philanderer (she didn't know it at the time), Hirshman writes:

The daughter, who is 13, chose to stay with an aunt. She was born in Japan and speaks only Japanese, but her parents entered Japan illegally. (A country with rigid, inflexible, and harsh immigration laws.) Mom finally got busted in 2006 and one of those nationally polarizing sagas ensued. Three years later, their poor daughter is weeping at the airport while cameras flash, and she has to choose between her parents and her country. She chose to stay, and likely will not see her parents again until she's 18. It's a terrible, heartbreaking situation, but only her parents are to blame.

Japan hasn't changed; they knew the gamble they were taking. I might have too were I living in the impoverished farming village they're returning to in the Philippines. But I'd like to think I would have chosen to illegally immigrate to a country with more flexible laws regarding aliens.

Then again, I also think we should abolish the boundaries between countries all over the world and let people go wherever they want to.

Yeah, I'm one of those One World People. There's more than enough for all of us, but we're too selfish and tribal to share with each other. Until then, Japan gets to enforce its laws.

The Power of Lobbying

The Washington Post reports on a new study about the fantastic efficiency of K Street lobbying:

In a remarkable illustration of the power of lobbying in Washington, a study released last week found that a single tax break in 2004 earned companies $220 for every dollar they spent on the issue — a 22,000 percent rate of return on their investment.

The study by researchers at the University of Kansas underscores the central reason that lobbying has become a $3 billion-a-year industry in Washington: It pays. The $787 billion stimulus act and major spending proposals have ratcheted up the lobbying frenzy further this year, even as President Obama and public-interest groups press for sharper restrictions on the practice.

The paper by three Kansas professors examined the impact of a one-time tax break approved by Congress in 2004 that allowed multinational corporations to "repatriate" profits earned overseas....The researchers calculated an average rate of return of 22,000 percent for those companies that helped lobby for the tax break. Eli Lilly, for example, reported in disclosure documents that it spent $8.5 million in 2003 and 2004 to lobby for the provision — and eventually gained tax savings of more than $2 billion.

Not bad!  But Eli Lilly is a piker.  Pfizer saved a cool $11 billion.  Here's the Top Ten:

Honesty compels me to to point out that this research overstates the value of lobbying by choosing only a single, particularly lucrative tax break to examine.  The overall return on lobbying investment for business interests is probably no more than, oh, three or four thousand percent.  Hardly worth getting in a lather about, really.  Please go about your business, citizens.

Scenes From the White House Egg Roll

The main difference between a Bush administration Easter egg roll and the Obamas'? Equal opportunity to throw up on the White House lawn. For the first Easter egg roll of the Obama presidency, the First Family distributed several thousand tickets to DC public schools, ensuring that the enormous crowd on the White House lawn was among the most diverse in modern history, and also the largest. (The White House gave out 30,000 tickets in all.) It wasn't an entirely terrible consolation prize to the school system that the Obamas rejected for their own kids.

At 6:30 a.m. this morning, my little DC neighborhood elementary school sent a small fleet of cheese buses down to the Ellipse to join the fray. We took off with the excitement of people who'd won the lottery, only to arrive at the scene with 6,000 other people who'd also hit it big. Not only did the Obamas invite local school kids, but they offered tickets to the rest of the country to ensure that the egg roll was no longer an exclusive event for Washington insiders and those willing to camp out overnight in the rain. All that democracy, though, meant a lot less egg rolling and a lot more standing in line. This year, black kids, white kids, kids from Alaska, kids from Anacostia, kids with two mommies, kids with no mommies, all had multiple, if not unique, opportunities to stand in line and freeze together in the shadow of the White House.

Millionaire Journalists

Bob Somerby has an assignment for some enterprising reporter:

Yesterday, Parade magazine offered a regular feature: “What People Earn: Our Annual Report.” Out on the cover and inside the magazine, Parade let us see how much people earn in all the various occupations.

Well — in all the various occupations but one. By our count, Parade offered head shots, with annual earnings, for 71 different people. There was a teacher, a pilot, a CEO and a realtor — two singers, a rapper and a big famous film star. But one occupation was oddly missing. No journalist could be found in the mix!

How much are major journalists paid? Major journalists rarely discuss that.

....Next year, could this feature include the earnings of some big major journalists? How much is Maureen Dowd paid, for example? Why can’t she and Rich grace Parade’s famous cover? We have literally never seen an estimate of Dowd’s yearly swag. We’re also curious how much she paid for JFK’s pad — how she managed to land such a pad even before she became a big columnist. Big journalists ask questions like that about everyone — except about other big journalists.

Well, maybe there were no big journalists, but in the online version they did include sports blogger Josh Bacott, who makes $10,700.  And TV news reporter John Dougherty, who makes $25,500.  So they're trying!  But sadly, no Dowd.  Maybe next year.

Obama's Bipartisanship

Whenever someone tells me that Obama has reneged on his commitment to bipartisanship, I always come back at them with some less articulate version of what Nate Silver is saying here:

...bipartisanship, as Obama intended the term, should not necessarily be confused for "compromise". Rather, it implied behaving in good-faith -- hearing out opinions from different sides of the aisle and identifying the best ideas regardless of their partisan origin. Bipartisanship, to Obama, was a process rather than an outcome. He could plausibly have been acting in a bipartisan manner, even if he hadn't gotten many Republicans to go along with his agenda.

In his election night victory speech, Obama repeated a line he had used throughout the campaign: "There are many who won't agree with every decision or policy I make as President, and we know that government can't solve every problem. But I will always be honest with you about the challenges we face. I will listen to you, especially when we disagree." I think as president, Obama has fulfilled the promise he made in that line. But listening to someone is one thing; doing what they say is another entirely.

Big Banks

Ezra Klein writes that big banks are bad for small depositors:

They're about the pros rather than the amateurs. Which may be why they're so cavalier about exacting fees and penalties on individual depositors at levels they'd never consider applying to professional markets. Indeed, pretty good research suggests that as banks get bigger — which tends to mean more competitive on the global financial market — they begin charging consumers more.

This seems to be true.  Take a look at the chart on the right from today's Wall Street Journal.  It shows that banks receiving bailout funds have increased fees at a far higher rate than banks that haven't.

Does this show that banks receiving federal assistance are more likely to raise their fees and penalties?  Of course not.  This trend is nine years old.  However, it's big banks that have received most of the TARP money, so you can pretty much replace "Banks receiving TARP funds" with "Big banks."  So what the chart shows is that big banks have increased their fee and penalty structure far more than small banks.

Why?  Because they can.  And in the past they've wielded enough political power to prevent Congress from doing anything about it.  If there's any justice — and needless to say, that's still an open question — those days are finally gone.