Mojo - March 2009

El Salvador's Quiet Revolution

| Mon Mar. 16, 2009 11:47 PM EDT

Roger Atwood has previously reported for Mother Jones from Iraq and Peru. This guest blog entry is a post-election follow up to his recent dispatch from El Salvador.

El Salvador's long civil war finally ended on Sunday night. As election results trickled in showing victory for Mauricio Funes, presidential candidate of the guerrilla group-turned-political party Farabundo Marti National Liberation Front, the streets around FMLN headquarters in San Salvador filled with people wearing red shirts, waving red flags, and chanting a line popularized by the president of the FMLN’s former archfoe, the United States: "Yes, we could!" 

Pickup trucks jammed with flatbed-riders and buses crammed with celebrating passengers crisscrossed the city into the night, red flags flapping behind them. The fact that many, if not most, of these celebrants were too young to remember the actual war did not change the fact that the promise of the 1992 peace agreement that ended the fighting and created a pluralist political system has finally been fulfilled. Through fair elections, Salvadorans chose the first genuinely left-wing government of their history. The ruling Nationalist Republic Alliance, or ARENA, which formed in the early 1980s with the express goal of stopping el comunismo, has collapsed under its own weight after 20 years in power. "This result says to the world that El Salvador is prepared for democratic alternation in power," Funes told cheering supporters. "Tonight, Salvadorans have signed a new peace agreement." The ARENA candidate Rodrigo Avila was sullen but gracious, saying in his concession speech, "When we said we would accept whatever result there was, we meant it." 

One learns not to get one's hopes up in a country that has seen as much betrayal and war as El Salvador, but this time it does look like the democratic transition is complete.

Funes takes office on June 1. He is going to face high expectations and tough odds. The economy relies on remittances from Salvadorans living abroad, and remittances are in sharp decline. At 55 homicides per 100,000 people, the crime rate is one of the highest in the world and intimately tied to the family disintegration caused by mass emigration. Even foreign trade has fallen far short of expectations, despite ARENA's ambitions for a globalized role: El Salvador's trade deficit rose to $5.2 billion last year, a sad performance for a small, export-driven economy.

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SF Chronicle Cuts Deal With Hearst

| Mon Mar. 16, 2009 7:04 PM EDT
Two quick updates for those watching the demise of American newspapers. First, the 146-year-old Seattle Post-Intelligencer will publish its last print edition tomorrow. After that, it will be published online only. Hearst failed to find a buyer after putting the P-I up for sale in January. The P-I will be the largest daily to convert into a solely digital format, leaving Seattle with just one print newspaper, the Seattle Times.

Another Hearst property, the San Francisco Chronicle, appears to be safe... for now. One of the Chronicle's two employee guilds has reached an agreement with Hearst that will allow the paper to continue publishing both in print and online. Guild members (which include the Chronicle's editorial, art, and marketing staff) voted 333-33 to accept terms that will result in at least 150 layoffs and buyouts. The terms will also reduce sick and vacation time and lengthen the standard workweek, but will secure "up to a year's pay and healthcare" for those who are forced out. The agreement is the result of 10 days of negotiations, with guild members suggesting various proposals to reduce layoffs such as employee ownership.

Palin: I'm No Hypocrite

| Mon Mar. 16, 2009 3:43 PM EDT

Sarah Palin's office moved fast last week to protect her (self-proclaimed) standing as a scourge of earmarks. On Friday, Mother Jones published a story reporting that the omnibus spending bill just passed by Congress and signed into law by President Barack Obama contained earmarks requested by the Alaska governor, who last year campaigned for the vice presidency as a foe of wasteful government spending, including earmarks. The article also noted that Alaska will receive roughly $140 million in earmarks, which will make it the biggest recipient of earmark spending among all fifty states in per capita terms.

Hours after the article appeared, Palin's office issued a press release headlined, "Governor Palin Continues Earmark Reform." The main point: since she took office in 2006, Palin has each year requested fewer earmarks and has recently only put in requests for a handful of projects. In other words, it's okay to make some earmark requests, just not a lot.

In addition to quickly putting out that press release, Palin's office went after Jake Tapper, ABC News' White House correspondent, who had blogged about the Mother Jones story.

Palin's communications director, Bill McAllister, contacted Tapper and contended, "The governor never said that earmarks should be abolished or that the State of Alaska wouldn't seek or accept any. Didn't happen. What she said…was that earmark reform was necessary and the state would need to rely less on federal money."

But neither Mother Jones nor Tapper had asserted that Palin had sought the abolition of earmarks. Both stories referred to her speech at the Republican National Convention, when she boasted that she had "championed reform to end the abuses of earmark spending by Congress. I told the Congress 'thanks, but no thanks,' for that Bridge to Nowhere." (That last claim was repeatedly debunked.) Tapper also noted that Palin, speaking to ABC News' Charlie Gibson, had said, "The abuse of earmarks, it's un-American, it's undemocratic, and it's not going to be accepted in a McCain-Palin administration. Earmark abuse will stop." Also in that interview, Palin added that John McCain was a crusader against earmark abuse, and "that's what I joined him in fighting." (McCain wants to end the practice of earmarking, not reform it.)

McAllister told Tapper that Palin made 51 earmark requests in FY 2008, totaling $256 million; 31 requests in FY 2009, totaling $197 million; and will request just eight earmarks in FY 2010, totaling $69 million. But when Mother Jones had asked McAllister to detail how many earmarks Palin had requested in the current spending bill, he declined to respond. And McAllister did not tell Tapper that Palin will turn down earmarks requested and won by Murkowski and Young.

Palin remains trapped between her campaign rhetoric and her governing reality. She denounced earmarks as a candidate; she continues to request and accept them as a governor.

Cuomo Subpoenas AIG Bonus Information

| Mon Mar. 16, 2009 3:30 PM EDT

As I anticipated, AIG was not in fact able to gather all the information Andrew Cuomo wanted before the New York attorney general's 4pm deadline. Cuomo wrote a letter to AIG this morning demanding information about the millions of dollars of bonus money it's handing out to employees of its financial services division—the same division that got it into the mess it's currently in. As the deadline passed this afternoon, Cuomo called performance bonuses for AIG executives "oxymoronic" and said he was issuing subpoenas immediately.

OnceIf Cuomo gets the names, you can expect the executives who received bonuses to be very publicly shamed. Maybe then some of them will give the money back.

Don't Trust Any Feminists Under 30

| Mon Mar. 16, 2009 3:28 PM EDT

When I was in the Air Force and 26 or 27, I worked with a civilian named Jim. Nice guy. He was about 45, wife and two kids. He'd recently been forced off active duty due to a weird heart glitch unlikely to flare up, and he was miserable about being forced out of uniform. I, on the other hand, was a total gym rat and fashion plate with an unlimited military future. I worked out so, I had to have my uniform sleeves tailored for my sculpted, Michelle-kiss-my-heinie arms. I monitored everything that went into my body and everything that went into anybody's body around me. I subscribed to magazines like Muscle and Fitness and would have competed in bodybuilding competitions had I not been too busy going to school at night to get ahead. Jim, with his Homer Simpson gut and comb over, got winded just using the copier. One day, he came in wincing and limping. He'd actually hurt himself stretching before one of his infrequent attempts to exercise. I laughed and laughed. Thought it was the funniest thing in the world, and only realized in retrospect that he was not sharing the joke. A callow, overconfident youth, it never occurred to me then that my reaction was cruel. And stupid. What, did I think I'd still be bench-pressing my body weight at 80?

In my late 30s, when my own mystery aches and pains began, and now nearly 50 when I never see the inside of a gym that doesn't have -boree after it, styling in my Walmart stretch pants and feeling my gut pillowing into my lap when I'm naked, I have one burning desire—to tell Jim I'm sorry I was such a bitch. Well, two: I'd also thank him for not slapping me. He respectfully tried that day to convince me that eventually age would catch up with me, too, and I wouldn't always be a young hottie, free to work out all evening, apply careful makeup everyday, and fuss over my complicated hairdo. What nonsense! I believe I actually went 'talk to the hand' on that nice man. He might as well have predicted I'd end up becoming a Buddhist monk or a lion-tamer. Never, ever would I "let myself go." "Never would I age," I must have thought. Never would I lose my zeal, or the time, to take care of myself first. 

Well, much as I'd like to, I can't apologize to Jim and commiserate with him over the follies of youth. That "unlikely weird heart glitch" glitched; and a former coworker called a few years after that to tell me JIm had keeled over dead at his desk.

All of that to say this to the young feminists so offended by this elder's critique: One day, you'll have your own Jim story to tell. One day, when you've lived through more of this bitch called life, but without all that youth and vigor, you'll hear yourself saying something like, "These young women today just don't get it. Not like we did." When you've made hideous mistakes you know were because you talked the feminist talk but didn't walk the feminist walk. When that day comes, if I haven't keeled over at my desk, please have the grace to call me up so we can laugh together at youth's callow overconfidence and refusal to listen with respect, if not agreement.

As my father used to say: Even a fool can give you something you can use. But you have to hear him out. I'm not a fool, so why not ask me what I meant, then sift through those insights for the nuggets you buy into? Or, just go on believing you're impervious to either error or critique.

But wait! I started it, right? I was disrespectful first, no? Grow up, girlies. When all those random grannies on the street criticize the way I've dressed my kids or what I'm letting them eat, I just say "thank you" or "have a nice day" or pretend not to have heard. When my mother gets in my business, I say "yes ma'am," then do exactly as I please. Unless she was right, then I take her advice. But however annoying my mom, however much of a busybody the old lady across the street is, I do not growl back. I do not tell them to mind their own business or point out how their generation might have won WWII but what about Jim Crow?

When I was in the military, I sought out the more senior females, took them to lunch, and listened. Same with the female partners at my firm when I was considering the law. Ditto my elders in publishing and journalism. Ninety percent of it was useless to me (or so I thought), but oh that 10 percent.

But, then, I went in assuming I didn't know everything about being a woman in a sexist world or navigating the currents of a profession as volatile as mine. And I went in with some old-fashioned home training.

I'm not talking about reverence, I'm talking about a thirst for the kind of knowledge that will help in the battles all your responses claim to be fighting so diligently for. Here's my final example: I take seriously the chidings of people who've been dead for as much as 150 years.

Cuomo's AIG Deadline: The Clock Is Ticking

| Mon Mar. 16, 2009 1:50 PM EDT

Andrew Cuomo, New York's attorney general, is a demanding man. First he demanded bonus information from Merrill Lynch, which paid out billions to its employees before announcing it lost over $15 billion in the fourth quarter of 2008. When Merrill wasn't forthcoming, he asked for it again and demanded the same information from Bank of America, which bought Merrill Lynch in late 2008. Now he's demanding bonus information from AIG, and he wants it by 4pm today. If Cuomo doesn't get what he wants by then, he'll be issuing subpoenas for it. Given Cuomo's recent history, it's unlikely he's bluffing. In his letter (PDF) to AIG CEO Edward Liddy, Cuomo writes:

We were disturbed to learn over the weekend of AIG's plans to pay millions of dollars to members of the Financial Products subsidiary through its Financial Products Retention Plan. Financial Products was, of course, the division of AIG that led to its meltdown and the huge infusion of taxpayer funds to save the firm. Previously, AIG had agreed at our request to make no payments out of its $600 million Financial Products deferred compensation pool.
We have requested the list of individuals who are to receive payments under this retention plan, as well as their positions at the firm, and it is surprising that you have yet to provide this information.

Cuomo has yet to get the list of individuals he originally requested. If you've been following the attorney general's modus operandi, you'll know what happens next. He didn't get what he originally wanted, so now he's asking for more:

In addition, we also now request a description of each individual's job description and performance at AIG Financial Products. Please also provide whatever contracts you now claim obligate you to make these payments. Moreover, you should immediately provide us with a list of who negotiated these contracts and who developed this retention plan so we can begin to investigate the circumstances surrounding these questionable bonus arrangements. Finally, we demand an immediate status report as to whether the payments under the retention plan have been made.

Judging from AIG's past history and general incompetence, it seems unlikely that the business will want to or be able to put together the information Cuomo wants in the next few hours. It's probably safe to assume that subpoenas will be forthcoming.

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Financial "Experts" Need to Seek Professional Help

| Mon Mar. 16, 2009 12:49 PM EDT

AARP stands unrivaled as a public voice for old folks. Yet so much of what they have to say about the current economic crisis, which has hit us geezers especially hard, is just godawful drivel. On my own blog last week, I commented on AARP magazine’s relentlessly upbeat take on being old and out of work. A recent bulletin piece was full of the same kinds of useless pick-me-ups. What really took the cake for me this time, though, was the financial planning advice offered to recession-battered geezers:

Avoid early withdrawals. “Taking hits on your retirement accounts, especially when the stock market is falling, generally isn’t a good idea,” says Matt D’Arcy, of Greybridge Financial in Cleveland. Seek professional help. “There are a lot of strategies that might help people avoid touching retirement investments,” he says. “The point is to sit down with someone who can help you map a plan.” If possible, delay Social Security. Benefits are reduced before full retirement age.

OK, let's just take these statements one-by-one. First, "Avoid early withdrawals." Nice advice if you can afford it. Or maybe not even then: These financial “experts” have been warning us for more than a year not to take our money out of the market. I just checked to see where the Dow Jones Average was a year ago–hovering around 12,000. I don’t need to tell you where it is now. Here’s a chart that tells the story all too clearly:

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Now, don’t you wish you’d made a couple of “early withdrawals” some time in the last year? Instead, we’ve been told again and again that we have to “hold tight” and “wait it out.” Not very useful for people who are already retired and depending on their savings–and could die before this thing hits bottom.

Senior Senators Face Serious 2010 Challenges

| Mon Mar. 16, 2009 12:34 PM EDT

Former Rep. Rob Simmons, a Republican who represented Connecticut's very blue (it went for Obama by 19 points) second congressional district from 2000 to 2006, announced on Sunday that he will challenge Sen. Chris Dodd in 2010. Despite the (R) next to his name, Simmons stands a chance: a recent poll showed him ahead of the once-popular incumbent.

The Pirates of Somalia: A Photo Essay

| Mon Mar. 16, 2009 11:35 AM EDT
The Boston Globe has assembled a spectacular photo essay of the chaos afloat off the shores of Somalia, where pirates have stepped up attacks on commercial shipping in the last year. Enjoy it for yourself here.

Obama: Assisting and Attacking AIG at the Same Time

| Mon Mar. 16, 2009 11:29 AM EDT

You bail it out, you own it.

That's the problem that Barack Obama is encountering. The federal government on his watch has poured tens of billions of dollars into AIG. And then comes the news that the failed insurance giant has awarded its execs hundreds of millions of dollars in bonuses. Though these rewards were set up by contracts established before the feds showered AIG with taxpayer dollars, the Obama administration is in a position to get blasted for this. After all, it's hard for the Obama White House to defend shoring up AIG with $170 billion in money from the Federal Reserve while its executives are scoring big.

Assuming propping up AIG is good policy, Obama has to sell this rescue--and all the others--to the public, and that's not any easier if AIG execs are lining their own pockets at the same time. Treasury Secretary Timothy Geithner has tried to pressure AIG chief Edward Liddy on these bonuses, and Liddy has attempted to hold firm, claiming much of these bonuses are necessary for the firm to retain talent. (Obvious response: if this is what you call talent, perhaps it's time to hand AIG over to amateurs.)

So Obama has to attack AIG while aiding it. He took a stab at this on Monday morning. At a White House appearance, when he was supposed to be talking about his plans to bolster small businesses, he took the opportunity to poke at AIG:

[AIG] is a corporation that finds itself in financial distress due to recklessness and greed.

Under these circumstances, it’s hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay. How do they justify this outrage to the taxpayers who are keeping the company afloat?

In the last six months, AIG has received substantial sums from the US Treasury. I’ve asked Secretary Geithner to use that leverage and pursue every legal avenue to block these bonuses and make the American taxpayers whole....This isn’t just a matter of dollars and cents. It’s about our fundamental values.

All across the country, there are people who are working hard and meeting their responsibilities every day, without the benefit of government bailouts or multi-million dollar bonuses....All they ask is that everyone, from Main Street to Wall Street to Washington, play by the same rules. That is an ethic we must demand.

What this situation also underscores is the need for overall financial regulatory reform, so we don’t find ourselves in this position again, and for some form of resolution mechanism in dealing with troubled financial institutions, so we have greater authority to protect the American taxpayer and our financial system in cases such as this. We will work with Congress to that end.

Will this approach--slam AIG, help it survive, and push financial reregulation--work politically? It probably depends on how much feeling--and what sort of feeling--Obama puts into the slamming part. A little anger won't hurt. There may be building--or seething--outrage beyond the Beltway. Obama has to make sure he's not blind-sided by it. And those recipients of federal largess at AIG are not helping.