Mojo - August 2010

Obama's "Cat Food Commission," Alan Greenspan, and the Dancing Grannies for Medicare

| Mon Aug. 9, 2010 11:04 AM EDT

President Obama’s Deficit Commission is all smoke and mirrors. Its members are making a big show of laboring over "painful" choices and considering all options in their quest to bring down the deficit. But inside the Beltway everyone knows what’s going to happen: The commission will reduce the deficit on the backs of the old and the poor, through cuts to Social Security, Medicare, and Medicaid. Some opponents have taken to calling it the Cat Food Commission, since that’s what its victims will be forced to eat once the commission gets done slashing away at their modest entitlements.

In fact, the true intent of the Deficit Commission was evident before it was even formed. That intent was only driven home when Obama appointed as its co-chair Alan Simpson, who is well known for voicing, in the most colorful terms, what Paul Krugman calls the "zombie lie" that old-age entitlements will soon bankrupt the country.

So why the big show? Because neither Obama nor Congress wants to get caught cutting Social Security and Medicare in public, certainly not before the November elections. (Medicaid will be cut as well, but politicians tend not to worry so much about poor people, since they don’t go to the polls in the numbers we geezers do.) So instead, they are foisting off this unpleasant task onto the Deficit Commission, showing what the lawyers call "due diligence," sucking their thumbs and pretending to study how to cut the deficit. They’ve got $1 billion in walk-around money to pay for propaganda so the PR industry ought to be plenty happy. So too, should billionaire Pete Peterson, as he and his foundation lackeys push on towards a victory in their longstanding attack on entitlements.

Quite frankly, if the Republican Right could get itself together and shove the tea party nuts back into their cave—as Reagan did with the crackpots hanging around him—they too could reap the benefits of the Cat Food Commission’s work. Ever since the New Deal, the Right has been kicking and screaming about Social Security. Things just got worse in the 1960s with Medicare and Medicaid. And now, thanks to our supposedly "socialist" president, they are within a few inches of cutting a nice hefty hunk out of the largest social programs this nation has ever known.

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We're Still at War: Photo of the Day for August 9, 2010

Mon Aug. 9, 2010 8:26 AM EDT

 

US Army Soldiers of 101st Airborne Division 1st Battalion 1-237 Infantry stand outside the town of Badmuk ready to assault Taliban forces suspected to be hiding in the town, Kunar province, Afghanistan, on Aug. 2. Photo via the US Army photo by Spc. Anthony Jackson.

Taliban Spins Time's Cover Photo

| Sat Aug. 7, 2010 3:58 PM EDT

Time magazine's editor, Richard Stengel, took a lot of crap last week for approving a cover image of 18-year-old Bibi Aisha, an Afghan woman whose nose and ears had been hacked off by her Taliban husband. The picture's context was the real source of dissension. Just below Aisha's chin sat the cover line: "What Happens if We Leave Afghanistan." (Note the "if," rather than a "when.") Amid talk of a US withdrawal and a possible detente between Afghan president Hamid Karzai and Talib leadership, Time wove Aisha's story into a larger narrative detailing the Taliban's brutal treatment of women. "They are the people that did this to me," she told the magazine. "How can we reconcile with them?"

The Taliban would like to explain itself now.

In a press release Saturday morning, the guerrilla group (still calling itself the Islamic Emirate of Afghanistan, the title it gave the diplomatically isolated country when it ruled Kabul) argued that Time's "barbaric" story violated journalism's professional code of ethics, as it was "a fabrication by the Americans, who are publishing these lies to divert attention of the people from their clear and disgraceful defeat." The release went on to claim that it ain't Afghanistan that's got a women's rights problem:

America which claims that it needs to protect and liberate Afghan women, to this we say, if there is any place on the earth were women need to be protected and treaty with dignity it is in America, were close to half a million females are raped each year, keeping in mind that more then 50% rapes are not reported. [sic x 5]

What followed were nearly 2,000 words citing stats from the CIA, the Centers for Disease Control and Prevention, and the New York City Gay and Lesbian Anti-Violence Project—among others—as evidence that the US is a heinous den of spousal abuse, date rape, human trafficking, civil-rights violations, and same-sex domestic violence. (This latter, from the group that banned homosexuality in Afghanistan, despite tacit acceptance of gay interactions in local tradition.)

Also name-checked in the Taliban broadside: ex-KBR employee Jamie Leigh Jones, Sen. Al Franken (D-Minn.), The Daily Show with Jon Stewart, the US Army, inner-city Philadelphia, and journalist Helen Benedict—though that entire passage of the press release may be lifted from original sources, since the English suddenly gets a lot better and more complex.

Hard to say what the significance of this is. The Taliban are capitalizing on the valid Western criticisms of Time's story, since Aisha was mutilated just last year, the eighth year of US military intervention in Afghanistan. Fat lot of good that military presence did her.

Still, you'll never hear me utter the words "The Taliban is right." We're talking about this Taliban, and this one, and this one, and this one. And this is what their Pakistani Talib brothers do.

And what of Aisha herself? The Taliban decry what was done to her, but cast aspersions on her account of the crime, since "this case has never been forwarded to any court or persons of Islamic Emirate of Afghanistan."

For her part, Aisha is headed for reconstructive surgery to repair her mutilated face. In America. Hope she watches out for sexual predators; I hear the US is full of 'em.

(h/t Aaron Y. Zelin, al-Maktabah; for more coverage on women's rights in Afghanistan, read MoJo's May/June 2009 package here, and an extended interview with author Khaled Hosseini here.)

Is Fannie Mae Sabotaging Obama's Housing Rescue?

| Fri Aug. 6, 2010 3:50 PM EDT

The utter failure of the Obama administration's flagship homeowner rescue is, by now, common knowledge. But has Fannie Mae, the government-backed and taxpayer-supported housing finance company, played an active role in sabotaging Obama's $75-billion bust of a program?

That's the most explosive allegation leveled by Caroline Herron, a former Fannie executive who worked closely with the Treasury Department on the housing program, called the Home Affordable Modification Program. Herron's claims appear in a suit, first reported on by Michael Hudson at the Center for Public Integrity, in which she alleges that Fannie fired her for criticizing the corporation's handling of HAMP and blackballed her from working at Treasury, where she'd hoped to start a new job. Herron's suit, available here, offers a damning critique of Fannie's handling of HAMP, saying the company put the pursuit of easy profits above helping American homeowners—even though it's ultimately American taxpayers who've kept Fannie afloat with more than $85 billion in bailout funds.

Here's one passage from Herron's suit:

"It appeared that Fannie Mae officers were focused on maximizing incentive payments available to Fannie Mae under various federal programs—even if this meant wasting taxpayer money and delaying the implementation of high-priority Treasury programs."

As the suit explains, Fannie received "substantive" incentive payments by getting homeowners modified mortgage deals on a temporary basis. In HAMP, you see, the homeowner first goes through a multiple-month trial run with lower payments. If the homeowner stays current during the trial run, the modification should theoretically be converted into a permanent modification, with the lower terms applying for three to five years. A three- or four-month trial mod doesn't do a homeowner much good—but those trial runs did put money in Fannie's pocket. As CPI's Hudson reports,

Herron charges that Fannie Mae continued in headlong pursuit of “trial mods” even though it knew many had little chance of becoming permanent. As late as September 2009, barely 1 percent of trial modifications had converted to permanent modifications by the end of their three-month trial, a Congressional oversight panel found. Nevertheless, Fannie preferred doing trials, Herron alleges, because it was eligible to receive incentive payments from the Treasury Department for trial modifications it booked before the end of 2009.

Another key part of Herron's suit is her description of Fannie's handling of what's called a "borrower portal." A chief complaint about HAMP is the sheer amount of paperwork involved, how that paperwork gets lost when sent to mortgage servicers, and how the application process creates a major bottleneck for the program. A borrower portal is basically an online application website, which, its proponents claim, would cut down on the paperwork debacle and speed up the application process. 

To its credit, the Treasury Department wanted a portal for HAMP, and asked Fannie to get one into place. Herron, however, alleges that Fannie did everything it could to block the portal and resist Treasury's request, which would've boosted HAMP. In other words, the company Treasury hired to run large parts of HAMP actively prevented the program from helping as many homeowners as it could. Herron's suit says she fought Fannie's attempts to block the portal, and that action led to her firing.

In all, Herron's allegations, if accurate, offer a damning look at how Fannie, already marred by years of mismanagement and accounting controversies, repeatedly undermined HAMP, the bailout-funded program created with regular Americans (and not big banks) in mind. Still, HAMP has mostly been a disaster and waste of taxpayer money. And little wonder why: The people running the show are dooming it fail.

Read former Fannie Mae executive Caroline Herron's suit against Fannie Mae:

Herron Lawsuit Against Fannie Mae

More Grim News on Jobs Front

| Fri Aug. 6, 2010 10:52 AM EDT

The Labor Department's monthly numbers are out, and it's mostly dark clouds in the jobs world. The unemployment rate remains 9.5 percent. The public sector shed more than 200,000 jobs in July, most of which were expired Census gigs. The ratio of employed Americans to the adult population dwindled slightly, but for did so for the third month in a row—a troubling sign. And the real unemployment figure—accounting for unemployment, underemployment, and discouraged workers—is stuck at 16.5 percent.

A silver lining: The private sector added 71,000 jobs in July, which, as Ezra Klein points out, is the most since April and third-best in 2010. He adds optimistically, "The 71,000 jobs we did gain came from the right place, and the jobs we lost are job losses we can prevent if Congress finds the will and the votes."

That optimism don't appear to shared by most other observers, nor backed by the Labor Department's data when you dig deeper in. For instance, the Labor Department went back and revised its jobs figures for June, reporting that 267,000 jobs were lost instead of 125,000 as initially thought. That's a major revision—and further proof that the economic recovery is far weaker than already thought.

Although the unemployment rate didn't budge, that's not because the jobs picture is getting rosier. Rather, people are still leaving the work force, quitting their search for a new job. As Zero Hedge points out, the employment-to-population ratio is the same today as it was in October 1983, per this chart:

Via Zero Hedge.Via Zero Hedge.

When the jobs picture finally begins to improve in earnest, those same people, encouraged by the positive signs they see on TV or read in the papers, will begin looking for work again. As a result, the jobless rate could inch even higher.

Meanwhile, the ranks of the long-term unemployed—out of work for six months or more, but still looking—remain at near-record levels, at 6.6 million, or 45 percent of all unemployed. That's still a staggering number.

All in all, this is more bad news for the Obama White House and Congress, especially the downward revision for June. It's telling that Christy Romer, the White House economic aide now on her way out the door, downplayed today's report: "It is important not to read too much into any one monthly report, positive or negative."

Yes, Congress' efforts to send more fiscal aid to state governments and small businesses (though the math behind the latter is somewhat flawed) are urgent and necessary, it's up to private employers right now to get the Great American Jobs Machine chugging along again. Many private employers have the money to increase hiring, but are spooked by new regulations or the instability of the economy and remain on the sidelines. We won't get growth until they start opening their doors again.

We're Still at War: Photo of the Day for August 6, 2010

Fri Aug. 6, 2010 5:00 AM EDT

 

US Army Staff Sgt. Clarence Washington, Provincial Reconstruction Team Zabul security forces squad leader, takes accountability after an indirect fire attack in Qalat City, Zabul Province, on July 27, 2010. Photo via the US Army by Sr. Airman Nathanael Callon.

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This Week in National Insecurity

| Thu Aug. 5, 2010 1:59 PM EDT

Whichever side of the fence you land on, chances are you agree that America's not a very secure nation these days: economically, electorally, and of course, physically. So we grabbed our lensatic compass, rucksack, and canteen, then mounted out across the global media landscape for a quick recon. Whether you're scared because our military isn't good enough—or you're scared because it's too good—here's all the ammunition you need, in a handy debrief.

In this installment: Mike Hastings, martyr; dealing with Iran; what mosques and married gays have to do with homeland security, allegedly; old Iraqi enemies; new Al Qaeda enemies; soldiers on hippie drugs; WikiLeaks groveling; and Taliban gangbangers. Word.

The sitrep:

The United States government's national threat level is Elevated, or Yellow. You're welcome.

  • After military overseers in Afghanistan yanked his embed reporting assignment this week, Rolling Stone's Michael "I write everything down" Hastings went on TV. The gist of his argument: He wasn't denied access because he got Gen. Stanley McChrystal fired, but because the war sucks, the war's media guys know it, and the last thing they need is more bad press. All true, but depressing. Mikey needs a Bud Light Lime. (MoJo/Yahoo News)
  • WHAT! Sanctions work on Iran? Holy ayatollah! Unless..."sanctions" is a euphemism for really big frickin' US and Israeli bombs, right? (Time)
  • Remember Tariq Aziz, Saddam Hussein's old foreign minister? (You'll recognize when you see him.) The now-imprisoned Ba'athist gave an interview cursing the US for invading Iraq in 2003...and cursing the US for wanting to leave Iraq in 2010. But apparently he's always been a little confused: The Nation's Iraq war expert, Jeremy Scahill, tweeted today: "when i met tariq aziz in baghdad in 1998, he went on and on about how he loved james baker and donald rumsfeld." Um, so...in this mutual admiration society, was there a goat sacrifice involved? (The Guardian)
  • Al Qaeda's North African outfit has decided its mortal enemy is not the Great Kenyan-American Satan, but rather Europe's refuge for cheese-eating surrender monkeys, the kingdom of Sarkozia. Apparently Al Qaeda is stunned that French commandos killed some members of the terrorist group in a vain attempt to rescue a Gallic aid worker. Not stunned that the French killed their colleagues, just stunned that they have commandos, 'cause hey. France. (Al Jazeera English)
  • How do you keep corn-fed, all-American flatlands soldier boys from passing out while they do their thing in Afghanistan's high-altitude areas? Drugs. Lots of 'em. Who says Pentagon research isn't totally hip? (Danger Room)

Robbing Renewables to Pay Teachers?

| Thu Aug. 5, 2010 12:35 PM EDT

The Senate is expected to give final approval today to a $26 billion package that will save states from having to lay off thousands of teachers and fund Medicaid, and the House is expected to come back in session next week to do the same. But is the bill robbing Peter to pay Paul? The package will be paid for in part by a $1.5 billion cut to renewable energy loan guarantees.

Part of the funds will be drawn from a $6 billion Department of Energy fund, the same fund the Senate borrowed from last year to give $2 billion to the Cash for Clunkers program. As you'd expect, the renewable energy sector is livid. The Solar Energy Industries Association sent a letter to senators urging them to vote against the cut. "It would be a terrible mistake to gut the DOE loan guarantee program right when it is on the verge of making dozens of clean energy projects a reality," wrote SEIA vice president of government affairs, Daniel Adamson.

Plundering the fund, SEIA said, would be "devastating to the solar industry's efforts to develop clean electric generation and would result in the loss of thousands of jobs" and would "jeopardize $15 to $20 billion of private investment in pollution-free energy generation and domestic manufacturing."

Majority Leader Harry Reid's office has insisted they are still committed to funding renewables. Reid spokesman Jim Manley writes to Politico's Morning Energy:

Sen. Reid has worked aggressively to secure tax breaks and funding for clean energy projects in Nevada and around the country, and he will continue to do so. He is working with the Administration to ensure funding that has been set aside for renewable projects is put to use as soon as possible to put Nevadans back to work and diversify the state's economy. While this is a priority for Sen. Reid, so is protecting the jobs of teachers and first responders, and that is what this bill is all about. The decision to enact these rescissions was a way to make sure we could protect hundreds of thousands of jobs, and do it in a way that does not add to the deficit.

I understand that there's an immediate need to fund these crucial programs, but the renewable energy loan program (which is quite small, I might add) shouldn't be the go-to source. There are, oh, billions more in subsidies and loopholes for the fossil fuel industry that Congress could use to fund this program. Or perhaps the Senate could dip into the $18.5 billion Congress has already committed to loans for nuclear power, a much more mature industry, rather than stealing from renewables.

Ben Nelson's Economic Hypocrisy

| Thu Aug. 5, 2010 11:11 AM EDT

Should we extend the Bush tax cuts? Let them expire for all Americans? Or lapse just for the very wealthy? These are the questions being asked in the latest economic battle that's playing out here in Washington. If the Bush tax cuts, implemented in 2001 and 2003, were allowed to expire for everyone, the average American household's tax payment could increase by about $1,500, according to the LA Times. So far, the fate of the Bush tax cuts is dividing lawmakers along the typical partisan lines, with Democrats and the Obama administration demanding an end to them and Republicans arguing for their extension.

And then there's centrist Sen. Ben Nelson (D-Neb.). He says he opposes increasing taxes, and thus supports extending the tax cuts. Nelson supported his un-Democratic position with this statement: "I think we're at a point in our economic recovery that anything that would adversely affect it, we ought to avoid."

Hmm. That sounds awfully hypocritical. After all, the veteran senator voted against or failed to show up to vote on an issue that's arguably the best tonic for our ailing economy: unemployment benefits. Nelson opposed or ignored jobless benefits five separate times over the last two years. Nelson cited concerns that adding to the deficit "could jeopardize the recovery."

Too bad that's utterly inaccurate. As countless economists (pdf) and studies have shown, unemployment insurance is an effective form of stimulus and a way to bolster the economic recovery. Weekly unemployment insurance checks mean money in the pockets of out of work Americans, who in turn will spend that money on groceries, health care, or searching for a new job, which, if they find, puts them back in the tax-paying workforce. As White House budget guru Peter Orszag put it, "Research has shown that the unemployment insurance system is among the most effective dollar-for-dollar economic stabilizers that we have in terms of counterbalancing periods of economic weakness."

So Ben Nelson says he's against anything that hurts the economic recovery, yet repeatedly blocked jobless benefits even though they're one of the best tools out there for boosting the economic recovery—a position that makes no sense at all.

Karzai's Anti-Corruption Obstruction

| Thu Aug. 5, 2010 8:02 AM EDT

Here we go again. Remember when Hamid Karzai amped up Afghan-US tensions in February when he moved to bring an independent election watchdog under his control? It was this maneuver that led the Obama administration to rescind an initial White House invite. Now, the Wall Street Journal reports, Karzai has staged a similar power play. Following the arrest of one of Karzai's top security aides on corruption charges, the Afghan president has clamped down on the two NATO-backed anti-corruption units that led the investigation.

Last week, Afghanistan's Major Crimes Task Force (MCTF) and a lesser-known division targeting high-level graft, the Sensitive Investigative Unit, jointly raided the home of Mohammed Zia Saleh, a top official who headed administration for Afghanistan's National Security Council. The Journal explains the allegations against Saleh:

According to several Western officials, U.S.-backed investigators taped a conversation in which Mr. Saleh was negotiating a bribe—in the form of a car—in return for squashing an inquiry into the New Ansari Exchange, a large and influential money-transfer outfit. New Ansari has deep connections with prominent members of the Afghan government and the Karzai family, and, according to investigators, it is also suspected of links to Taliban insurgents and narcotics smugglers. The car, valued at about $10,000, was allegedly a small part of a larger proposed payoff, the officials said.

Saleh's arrest by the anti-corruption units, which are run with the help of American and British adivisors, reportedly enraged Karzai, who viewed it as an assault of Afghan sovereignty. (Karzai apparently wasn't made aware of the operation, which raises its own set of questions.) As in February, when he felt the international community encroaching on the elections watchdog, Karzai swooped in. In this case, he's putting in place a commission that will monitor "all of the activities" of both task forces, while also reviewing past and present investigations. "The president has ordered the commission to look into the overall practices of the MCTF because it seems that there are some aspects of where they went beyond the Afghan legislation and the constitution of Afghanistan," Karzai's top spokesman, Waheed Omar, said earlier this week.

Since the Obama administration ramped up pressure on Karzai to crack down on corruption, the Afghan leader has taken a schizophrenic approach to the issue, making contradictory statements that cast doubt on his commitment. He calls fighting graft a top priority, but later describes Afghanistan's corruption problem is vastly overblown. He convenes an anti-corruption conference, then suggests in his speech that a recent anti-corruption coup (the prosecution of the mayor of Kabul) was a miscarriage of justice. He pledges that "individuals who are involved in corruption will have no place in the government," but chafes when investigators stray too close to his inner circle.

Karzai's latest move seems destined to neuter these two high-level law enforcement organizations—and it has already succeeded in reviving tensions between the Afghan and US governments. It surely sends another mixed message about Karzai's anti-corruption commitment. The Major Crimes Task Force, in particular, has often been cited as one of Afghanistan's anti-corruption success stories by US and Afghan officials alike. Now it's just further evidence that the Obama administration's strategy—of which anti-corruption initiatives are a key pillar—is faring poorly indeed.