Category: Economy

Cross posted from the Stars Hollow Gazette

The push for an increase in the minimum wage has grown with the recent passing of an increase in New Jersey from $7.25 to 8.25 with annual increases based in inflation. The amendment to the state’s constitution passed with 61% of the vote over newly reelected Governor Chris Christie’s objection. A Gallup poll conducted Nov. 5-6 shows that an even greater percentage of Americans would vote for an even higher minimum wage. According to a White House official, the Obama administration supports the bill introduced by Sen. Tom Harkin (D-IA) and and Rep. George Miller (D-CA) to raise the federal minimum wage from $7.25 an hour to $10.10 an hour in increments of 95 cents.

The same Gallup poll that showed 76% of Americans support for the increase, also showed support across party lines with 58% of self-identified Republicans supporting it. So what’s the problem? The issue is congress’ feral children, the Tea Party coalition in both houses who have vowed to block it and would completely abolish the minimum wage if they had their way. These are the same extremists who would repeal child labor laws, as well.

Despite the objections of the radical minority, the wave for an increase of the minimum wage is swelling as RJ Eskow observes:

“There’s something happening here/what it is ain’t exactly clear …”

When Steve Stills wrote the dystopian anthem “For What It’s Worth” in 1966, it resonated with listeners who understood that great if half-hidden transformations were underway. There’s been a turn toward the dystopian in recent economic and social trends as well: Wall Street greed and criminality. The growing power of wealth over the political process. The rise of the Tea Party. The collapsing middle class. Growing inequalities of wealth. Lost social mobility.

But there were encouraging signs in 1966, as well as troubling ones, and that’s equally true today. Take the movement for a minimum wage. Voters in the state of New Jersey and the city of Tacoma, Washington voted to increase the minimum wage in last week’s election. These victories follow a series of polls which confirm that the general public holds strongly progressive views on issues which range from taxation to Medicare and Social Security.

Something is happening here.

Noam Scheiber, senior editor for The New Republic, spoke with Rachel Maddow about why economic populism is a wise strategy for Democrats.

Cross posted looked The Stars Hollow Gazette

Details of a highly secretive, multi-national trade agreement in the works have been published by WikiLeaks, and a warning there will be vast implications for much of the modern world if the contract is approved.

WikiLeaks has released the draft text of a chapter of the Trans-Pacific Partnership (TPP) agreement, a multilateral free-trade treaty currently being negotiated in secret by 12 Pacific Rim nations.

The full agreement covers a number of areas, but the chapter published by WikiLeaks focuses on intellectual property rights, an area of law which has effects in areas as diverse as pharmaceuticals and civil liberties.

Negotiations for the TPP have included representatives from the United States, Canada, Australia, New Zealand, Japan, Mexico, Malaysia, Chile, Singapore, Peru, Vietnam, and Brunei, but have been conducted behind closed doors. Even members of the US Congress were only allowed to view selected portions of the documents under supervision.

Here is the full text of press release by Wikileak’s founder Julian Assange

President Barack Obama wants to fast track this travesty through Congress which means there would be little or no debate and it could not be amended. This is a dangerous agreement that will endanger sovereign and individual rights, plunge millions of people around the world into poverty and condemn many of them to death by  limiting access to affordable medicines. It is time to stop this. Join the movement to Stop the TPP and send a message to your representatives telling them to reject the TPP.

As an addendum, I suggest you read Yves Smith at naked capitalism to further understand how secret panels would undermine our law and regulations.

Jump below the fold for the text of the 95 page agreement.

Cross posted from The Stars Hollow Gazette

In the wake of last week’s off-off year elections, Bill Moyers sat down with Washington correspondent for The Nation, John Nichols, and professor of communications at the University of Illinois, Robert McChesney, to discuss how big money and big media conglomerates are raking in a fortune, influencing elections and undermining democracy

This past Tuesday, special interests pumped big money into promoting or tearing down candidates and ballot initiatives in elections across the country. It was a reprise on a small scale of the $7 billion we saw going into presidential, congressional and judicial races in 2012. To sway the vote, wealthy individuals and corporations bought campaign ads, boosting revenues at a handful of media conglomerates who have a near-monopoly on the airwaves. [..]

“Democracy means rule of the people: one person, one vote,” McChesney says. “Dollarocracy means the rule of the dollars: one dollar, one vote. Those with lots of dollars have lots of power. Those with no dollars have no power.” Nichols tells Moyers: “Dollarocracy has the ability to animate dead ideas. You can take an idea that’s a bad idea, buried by the voters. Dollarocracy can dig it up and that zombie idea will walk among us.”

An Election About GOP Extremism, Unions, Wages and Dollarocracy

by John Nichols, The Nation

Two states will elect governors Tuesday and one of those governors could emerge as a 2016 presidential contender. The nation’s largest city will elect a mayor, as will hundreds of other communities. A minimum-wage hike is on the ballot. So is marijuana legalization. So is the labeling of genetically-modified foods. And Seattle might elect a city council member who promises to open the fight for a $15-an-hour minimum wage.

Forget the silly dodge that says local and state elections don’t tell us anything. They provide measures of how national developments – like the federal government shutdown – are playing politically. They give us a sense of whether the “war on women” is widening the gender gap. They tell us what issues are in play and the extent to which the political debate is evolving.

Cross posted from The Stars Hollow Gazette

Late last month in the midst of the media obsession over the failure of a web site, the Senate Finance Committee called on congress to pass fast-track legislation aimed at smoothing the passage of any future trade deals that would include the Trans-Pacific Partnership Agreement.

Panel Chairman Max Baucus (D-Mont.) and ranking member Orrin Hatch (R-Utah) said during a trade hearing that they are working on crafting trade promotion authority (TPA) legislation and are expecting the Obama administration to work with them toward gaining its approval in Congress.

Baucus said it is time to “pass TPA and do it soon.”

He noted that President Obama has asked Congress to craft legislation and U.S. Trade Representative Michael Froman is encouraging lawmakers to move forward so “it’s time for us to do our part, introduce a bill and do it quickly.” [..]

The hearing’s witnesses placed a high level of importance on completing TPA because it they argued that it will strengthen the negotiating hand of U.S. trade officials who are working on the U.S.-European Union trade deal as well as the Trans-Pacific Partnership (TPP).

The TPP is a 12-nation Asia-Pacific trade agreement that Obama and Froman, along with many of the other negotiators, are aiming to complete by the end of the year.

What does “fast track” mean? I think Charles Pierce summarized it nicely

Sometime very soon, the Congress is likely to pass — with limited, if any debate and no amendments possible — a massive trade deal that was negotiated in secret, and the terms of which remain largely secret, and which, if the past is any kind of prologue, will drop a thousand-pound stink bomb on American jobs.

Debate (theoretically) cannot ever end on Mel Watt and his middling level federal job.

Debate cannot even begin on the Trans-Pacific Partnership.

Check the umpire because somebody’s screwing us.

The umpire is President Barack Obama and his merry band of corporate thieves.

Cross posted from The Stars Hollow Gazette

President Barack Obama is pushing approval of The Trans-Pacific Partnership by the end of the year.

U.S. Trade Representative Michael Froman said on Tuesday that world trade ministers may discuss the U.S.-proposed Trans-Pacific Partnership (TPP) on the sidelines of a World Trade Organization meeting that starts on December 3, with a goal of reaching a deal by year-end.

But several outstanding issues remain, he told reporters at the Asia-Pacific Economic Cooperation (APEC) summit on the Indonesian island of Bali, citing issues ranging from intellectual property to state-owned enterprises, labor and the environment. The WTO meeting will also be held on Bali.

The three-year-old TPP talks, now involving 12 nations, are aimed at establishing a free-trade bloc that would stretch from Vietnam to Chile to Japan, encompassing 800 million people, about a third of world trade and nearly 40 percent of the global economy.

A major goal of the Obama administration, the TPP would tear down trade barriers in areas such as government procurement and set standards for workers’ rights, environmental protection and intellectual property rights.

In actuality, the TPP has little to do with free trade. In a thirty minute interview with Bill Moyers, investment banking expert Yves Smith who runs the blog naked capitalism and economist Dean Baker, co-director of the Center for Economic and Policy Research discuss the real agenda of the agreement.

A US-led trade deal is currently being negotiated that could increase the price of prescription drugs, weaken financial regulations and even allow partner countries to challenge American laws. But few know its substance.

The pact, the Trans-Pacific Partnership (TPP), is deliberately shrouded in secrecy, a trade deal powerful people, including President Obama, don’t want you to know about. More than 130 members of Congress have asked the White House for greater transparency about the negotiations and were essentially told to go fly a kite. While most of us are in the dark about the contents of the deal, which Obama aims to seal by year end, corporate lobbyists are in the know about what it contains.

How the Trans-Pacific Partnership Would Roll Back the Financial Regulations Needed to Avoid Another Crisis

by Expose the TPP

   The TPP would ban capital controls, an essential policy tool to counter destabilizing flows of speculative money. Even the International Monetary Fund has recently endorsed capital controls as legitimate for mitigating or preventing financial crises.

   The TPP would prohibit taxes on Wall Street speculation. That means that there would be no hope of passing proposals like the Robin Hood Tax, which would impose a tiny tax on Wall Street transactions to tamp down speculation-fueled volatility while generating hundreds of billions of dollars’ worth of revenue for social, health, or environmental causes.

   The TPP would empower financial firms to directly attack these government policies in foreign tribunals, and demand taxpayer compensation for policies they claim undermine their expected future profits.

The Trans-Pacific Partnership: A Trade Agreement for Protectionists

By Dean Baker, Center for Economic and Policy Research

There are many other areas where we could envision freer trade bringing real gains to the bulk of the population. However this is not what the TPP is about. The TPP is about crafting rules that will favor big business at the expense of the rest of the population in both the United States and in other countries.

For example, we can expect to see limits on the ability of national and sub-national governments to impose environmental restrictions, such requirements that companies engaging in fracking disclose the list of chemicals they use. There may also be limits on the extent to which governments can restrict the sale of genetically modified foods, with rules on labeling. And, the TPP may prevent governments from imposing restraints on financial firms that would prevent the sort of abuses that we saw during the run-up of the housing bubble.

The world has benefited from the opening of trade over the last four decades. But this opening has been selective so that, at least in the United States, most of the gains have gone to those at the top. It is possible to design trade deals that benefit the population as a whole, but not when corporate interests are literally the negotiators at the table. Rather than being about advancing free trade, the TPP is the answer to the question: “how can we make the rich richer?

Another Reason to Hate TPP: It Gives Big Content New Tools to Undermine Sane Digital Rights Policies

by Corynne McSherry and Maira Sutton, Electronic Freedom Foundation

Like the rest of the TPP, we only know what has been leaked. Based on that, it seems the negotiators are poised to give private corporations new tools to undermine national sovereignty and democratic processes. Specifically, TPP would give multinational companies the power to sue countries over laws that that might diminish the value of their company or cut into their expected future profits.

The provision that gives them this power is called “investor-state dispute settlement” (or ISDS for short). The policy was originally intended to ensure that investments in developing countries were not illegally expropriated by “rogue” governments, thereby encouraging foreign investment. But what began as a remedy to a specific problem has since been co-opted to serve very different purposes. Under investor-state, if a regulation gets in the way of a foreign investor’s ability to profit from its investment, the investor can sue a country for monetary damages based on both alleged lost profits and “expected future profits.” There are no monetary limits to the potential award.

Apparently a country’s own courts can’t be trusted to administer this kind of lawsuit, so investor-state also requires the creation of a new court. It would be comprised of three private-sector attorneys who take turns being judge and/or corporate advocate.

Cross posted from The Stars Hollow Gazette

The last imbroglio over raising the debt ceiling may be over for the moment but the threat is still hanging on the horizon. Its use as a bargaining tool by the minority to circumvent laws they don’t like and elections they lost is an extremely dangerous tactic that effects not just the American economy but could bring down the global economy and irreparably harm the value of the dollar and America’s reputation of being a good investment. Even the financial and business sectors have called the debt ceiling toxic to economic health. The CEO of JP Morgan, Jamie Dimon, when asked about the consequences of not raising the debt ceiling responded, “you don’t want to know.” Martin Wolf, the chief economic commentator at The Financial Times called the debt ceiling law a “doomsday device” that should be repealed. In simple terms he explained why it is too dangerous to use:

The first is constitutional. In a recent article, Neil Buchanan of The George Washington University and Michael Dorf of Cornell (pdf) argue that a binding debt ceiling would create a “trilemma” for the president: “Ignore the debt ceiling and unilaterally issue new bonds, thus usurping Congress’s borrowing power; unilaterally raise taxes, thus usurping Congress’s taxing power; or unilaterally cut spending, thus usurping Congress’s spending power.” Thus, a binding debt ceiling would force the president to violate his obligation to “take care that the laws be faithfully executed”. The authors conclude that the president should choose the “least unconstitutional” course and ignore the debt ceiling. But, inevitably, whatever the president did would create a constitutional crisis. No responsible Congress would seek to put the president in that position.

The second reason why the debt ceiling is so dangerous is that the administration could not obey it in a non-destructive way. At some point between October 17 and the end of the month, the administration would lack the money to pay its bills. All choices would be dire.

Mr. Wolf explains that the claims of “prioritisation” by the Treasury Department to pick and choose which bills to pay would still be a default (pdf). Mostly, it is not possible since Treasury uses two different computer systems to pay its foreign and domestic bills. The states that the economics effect of choosing which to pay and which to allow to default would effect the Treasury bonds aming them a risky investment. The International Monetary Fund and World Bank heads meeting in Washington last week issued warnings of the grave dangers to the global economy.

In an interview with Bill Moyers’, Mr. Wolf gives his analysis of the debt ceiling crisis.

Cross posted from The Stars Hollow Gazette

President Barack Obama signed the bill early Thursday morning that reopens the government and raises the debt ceiling, officially ending the 16-day shutdown, the White House said.

CNN Breaking News

If anyone thinks that the latest budget crisis is over, or that there was a victory, they are living in the bubble of a fool’s paradise.

This has cost the economy billions, hurt countless individuals in many ways for a deal that merely kicks the can down the road. Come January, unless a long term budget deal is passed, another continuing resolution (CR) will be needed. February is even more ominous when again the US hits its borrowing limit.

Obama should have stood his ground last year when he caved and gave the Republicans the sequester which is far more damaging to the economy than the ACA. Look what happened to the Republican brand. That could have been last year and the Democrats might have stood a better chance of increasing its majority in the Senate and gaining even more than 8 seats in the House.

There is no sense in rehashing what can’t be undone. The Democrats now need to deal with repairing the damage of the last 5 years continuing to hold firm on the budget, ending the sequester cuts for more reasonable spending that will benefit the majority of Americans and finally killing the biggest threat to the US and World economies, the debt ceiling cap.

Time to take the bullets out of the gun.

Cross posted from The Stars Hollow Gazette

Chris Hayes, the host of MSNBC’s All In, has the most concise and informative summary of the countdown to default.

With days until default, a breakthrough?

With just three days to go until an unprecedented, possible U.S. default, there is some hope at this hour of a deal to re-open the government, raise the debt ceiling, and put an end to the shutdown. Rep. Chris Van Hollen and Rep. Scott Rigell join Chris Hayes to discuss inner dealings and where we’re at the road to re-open the government.

Cross posted from The Stars Hollow Gazette

There are a few fools in the House and Senate who don’t understand the consequences of the US defaulting on its debt payments. Flirting with default is not an option to solve a budget impasse. It’s a recipe for global financial disaster.

The right’s antics could cause a Depression: The terrifying default aftermath

by David Dayen, Salon

Normally with a financial crisis, there’s at least agreement on the need for a response. Not with these lunatics

The biggest threat from the twin calamities of the government shutdown and the debt limit breach is not actually the real-world effect; it’s what happens the next day, and the day after that. In other words, the most frightening thing about default, which is much more problematic than the shutdown, is what happens afterward. [..]

And all of these outcomes pale in comparison to what would happen if the government defaulted on any of its debts. Put the misguided statements of debt limit denialist Republicans aside. Based on current cash on hand at the Treasury Department, roughly 32 percent of the funds owed (pdf) between Oct. 18 and Nov. 15 would have to go unpaid. That’s a massive reduction in federal spending, and would cause a significant hit to Gross Domestic Product. Prioritization of payments, which may be unconstitutional, would certainly be a logistical nightmare, forcing Treasury to rewire its payment system (pdf) and pick and choose between up to 100 million monthly invoices.

If one of the missed payments is to a holder of U.S. debt, then you have a default event that could cause credit markets to freeze, the U.S. dollar to plummet, and financial institutions to struggle to secure short-term lending on which they rely. With the dollar and the U.S. Treasury bond serving as a benchmark for world markets, Businessweek says that the resulting global apocalypse would dwarf the implosion of Lehman Brothers that precipitated the 2008 financial crisis. And it would injure the perceived stability of U.S. debt maybe forever, raising our borrowing rates as investors decide a country that threatens to default for no good reason isn’t worth putting their money into. [..]

Armed with the knowledge that Congress won’t meaningfully help recover the economy, the White House needs to think very hard about forsaking the various options they could use to try and avert a debt default. It’s not just that the alternative is a disaster; it’s a prolonged disaster.

IMF piles pressure on US to reconcile differences and prevent debt default

by Larry Elliot and Jill Treanor, The Guardian

Shares and oil prices rise in hope of six-week extension as OECD warns US deadlock threatens world economy

The International Monetary Fund and the Organisation for Economic Cooperation and Development both issued sharply worded warnings to Republicans and Democrats amid signs that America’s Asian creditors were becoming alarmed at the potential consequences of the impasse. [..]

Speculation about a deal emerged after Jack Lew, the US Treasury secretary said there would be chaos if the US defaulted – a message rammed home by the IMF’s Christine Lagarde and the OECD’s secretary general Angel Gurría.

Lagarde, the IMF’s managing director, said there would be very dangerous consequences for the US economy and very dangerous consequences outside the US economy if the default was not prevented.

She distanced herself from the infighting in Washington, noting: “The IMF does not make recommendations about how, politically, this can be resolved. We don’t take a political view. We just look at the economic consequences.

“When it affects the largest economy in the world, we are bound not only to look at the immediate domestic consequences but at what happens elsewhere, so that we can have a dialogue with our members to help them prepare. I hope we will be able to look back in a few weeks and say what a waste of time that was. But we have to look at the risks no matter how unlikely they are to materialise.”

On Wednesday, Massachusetts Senator Elizabeth Warren addressed the Senate warning that “this is no time to act out dangerous fantasies.”

“We’re in this position for one reason, and one reason only: because Congress told the government to spend more money than we have – and Congress told the Treasury to run up our debt to pay for it – but now Congress is threatening to run out on the bill,” Senator Warren said.  “…The idea that we can somehow renege on our debts without paying a huge price is a fantasy-and a very dangerous one.” [..]

“This fight is about financial responsibility. Financially responsible people don’t charge thousands on their credit cards and then tear up the bill when it arrives. Financially responsible nations don’t either….If we default on our debt, we could bring on a worldwide recession-a recession that would pummel hard-working middle class people, people who lost homes and jobs and retirement savings and who are barely getting back on their feet,” said Warren.

Talks between White House and Republicans fail to end US shutdown

by Dan Roberts, The Guardian

Hopes that a deal might be in sight disappear as Barack Obama and House speaker John Boehner fail to see eye to eye

Discussions between Barack Obama and House speaker John Boehner broke up after 90 minutes with little apparent progress, although there was a marked change in tone on both sides that suggests a deal could still be close. [..]

But the Republicans refused to lift a separate threat to spending authorisation, which has led to a partial shutdown of the government since 1 October.

Obama had insisted on at least a temporary reprieve from both threats before he would agree to negotiate over Republican demands to repeal his healthcare reforms and cut spending.

On Thursday night, it appeared the president had chosen to stand his ground and may have initially refused to accept the partial climbdown from Boehner.

The game continues and no one is hitting the brake.

Cross posted from The Stars Hollow Gazette

The business community is worried that they no longer have any influence over the Republican Party and place the blame for this current crisis squarely on the Tea Party faction of the House.

As the government shutdown grinds toward a potential debt default, some of the country’s most influential business executives have come to a conclusion all but unthinkable a few years ago: Their voices are carrying little weight with the House majority that their millions of dollars in campaign contributions helped build and sustain.

Their frustration has grown so intense in recent days that several trade association officials warned in interviews on Wednesday that they were considering helping wage primary campaigns against Republican lawmakers who had worked to engineer the political standoff in Washington.

Such an effort would thrust Washington’s traditionally cautious and pragmatic business lobby into open warfare with the Tea Party faction, which has grown in influence since the 2010 election and won a series of skirmishes with the Republican establishment in the last two years. [..]

In the two previous battles over the debt limit, many chief executives were reluctant to take sides, banding together in groups like Fix the Debt, which spent millions of dollars on a campaign urging Democrats and Republicans to work toward a “grand bargain” on the budget. But with shutdown a reality, and the clock ticking toward default, some of those same executives now place the blame squarely on conservative Republicans in the House.

The handful of Tea Party extremists, who believe that it’s OK to crash the world’s economy for their ideology, are out of control and unreasonable, not that they ever weren’t. But now the creators of this American version of Al Qaeda are scared. Yeah, they are scared. When you have the Koch brothers writing letters (pdf) to the US Senate insisting that the company was not involved in any ploy to shut down the government in efforts to defund Obamacare and Heritage Action, an arm of the Koch bothers’ Heritage Foundation, telling the House to raise the debt ceiling, you know they’re rattled.

Michael Needham, CEO of the powerful group Heritage Action, said that he opposed conditioning a crucial vote to increase the government’s borrowing authority on the group’s main goal: defunding Obamacare.

Under questioning at a breakfast with reporters, hosted by the Christian Science Monitor, Needham, a product of the Stanford Business School, conceded that failure to raise the debt ceiling would indeed disrupt the global economy. [..]

That could give Obama and House Speaker John Boehner (R-Ohio) at least a smidgen of room to maneuver if and when they decide to strike an overall deal: the White House could get a “clean” debt ceiling vote (though of short duration) and the GOP could get a concession or two on the continuing resolution to fund the government’s annual spending.

Taking the cue, the reluctant leader of the pack, House Speaker John Boehner (R-OH, House Majority Leader Eric Cantor (R-VA))and other members of the GOP leadership are meeting this afternoon at the White House to discuss a short term solution to raise the debt ceiling but not ending the government shutdown

Republican House leaders Thursday offered the president and Senate far less than they want in the ongoing financial standoff, presenting a six-week hike of the debt limit, but no deal to reopen the shuttered federal government.While the plan would grant six more weeks before the nation faces the chance of a default, it is contingent on the president agreeing to give up one of his key stances — that he will not sit down and negotiate until the government is reopened and the House stops using the $16.7 trillion debt limit as a lever to extract concessions. The limit is expected to be reached Oct. 17.

Nope, says the White House:

“The President has made clear that he will not pay a ransom for Congress doing its job and paying our bills,” an administration official said in a statement.

“It is better for economic certainty for Congress to take the threat of default off the table for as long as possible, which is why we support the Senate Democrats’ efforts to raise the debt limit for a year with no extraneous political strings attached,” the official continued, adding that Obama still want a straight up-or-down vote on a measure that the Senate passed to reopen government.

“Once Republicans in Congress act to remove the threat of default and end this harmful government shutdown, the President will be willing to negotiate on a broader budget agreement to create jobs, grow the economy, and put our fiscal house in order,” the official said. “While we are willing to look at any proposal Congress puts forward to end these manufactured crises, we will not allow a faction of the Republicans in the House to hold the economy hostage to its extraneous and extreme political demands. Congress needs to pass a clean debt limit increase and a funding bill to reopen the government.”

This doesn’t sound very promising. Boehner’s problem is that unless he violates the Hastert Rule and goes the House Minority Leader Nancy Pelosi (D-CA) and the Democrats for help, there is no way he can get a clean debt ceiling bill to the House floor. Boehner is betting the faith and credit of the US on Obama agreeing to his terms. The president is betting that Boehner will be forced to cave, abandon the Hastert Rule, and put a clean debt ceiling bill up for a vote.

Reid and Obama are also unsure whether Boehner can actually push his proposal through the House in the first place. They aren’t convinced hard-line conservatives and tea party aligned House Republicans won’t balk, forcing Boehner to turn to House Democrats for support. But any Democratic support would be tied to reopening the government.

Here’s the House GOP plan, and the thinking behind it: Republicans would vote to lift the debt ceiling until Nov. 22 – just before the Thanksgiving recess – while prohibiting the Treasury Department from using extraordinary measures to lift the borrowing limit. The legislation will also set up a negotiation over the borrowing cap and government funding. At this time, there are no spending cuts attached to the legislation. There is also no vote scheduled.

The game of chicken continues leaving not just the average American at great risk but putting the business community at loggerheads on who to fund to represent them in the long run. This game will have consequences. Question is for whom? And how dire?  

Cross posted from The Stars Hollow Gazette

The government shutdown and the threat of default on debt payments kept President Barack Obama from attending the recent round of talks on the Trans-Pacific Partnership (TPP). The president has hopes that it will be finished by the end of the year. Major corporations are urging the Pres. Obama not to “water down” the agreement which would put billions in their pockets sucking more money from the 99%, creating an even bigger income gap around the world. The TPP, which has been negotiated in secret since the Bush administration, would prioritize corporate rights over the rights of consumers and workers. In June, Rep. Alan Grayson was allowed to read the text of the TPP, that he described as “an anti-American power grab by big corporations”

The TPP is a large, secret trade agreement that is being negotiated with many countries in East Asia and South America.

The TPP is nicknamed “NAFTA on steroids.”  Now that I’ve read it, I can see why. I can’t tell you what’s in the agreement, because the U.S. Trade Representative calls it classified. But I can tell you two things about it.

1)    There is no national security purpose in keeping this text secret.

2)    This agreement hands the sovereignty of our country over to corporate interests.

3)    What they can’t afford to tell the American public is that [the rest of this sentence is classified].

(Well, I did promise to tell you only two things about it.)

I will be fighting this agreement with everything I’ve got. And I know you’ll be there every step of the way.

Besides this agreement being labeled a secret except for the business insiders who are negotiating it, the corporations want Congress to “fast track” it’s approval which the president the ability to put an accord before lawmakers for an up-or-down vote. This would assure that the TPP would pass without congressional oversight. However, some lawmakers are balking, at not only fast tracking the agreement, but the agreement itself:

A growing chorus of lawmakers is calling for trade negotiators to address issues including currency manipulation, food-safety standards and competition with state-backed industries as the administration seeks “fast-track” authority to smooth eventual passage of the Trans-Pacific Partnership.

“I oppose fast-track authority like what we have had in the past,” Representative Rosa DeLauro, a Connecticut Democrat, said on a conference call today with reporters. “We are not just here to rubber stamp what gets done” by trade negotiators, she said. [..]

Negotiations are “being done without sufficient input from members of Congress,” DeLauro said. Lawmakers should have more of a say because the TPP is a 21st century agreement that goes beyond traditional tariff deals, she said. The TPP would entail issues including environmental protection, Internet trade, access to medicines and market access for small businesses.

A bipartisan group of 60 senators — a bloc big enough to sink a trade accord — on Sept. 24 urged the administration to include provisions to prevent currency manipulation in U.S. free-trade agreements.

Lori Wallach, director of Public Citizen’s Global Trade Watch, joined Democracy Now!‘s Amy Goodman and Juan González to discuss how this corporate “Trojan Horse” would rewrite US laws and regulation

While the text of the treaty has been largely negotiated behind closed doors and, until June, kept secret from Congress, more than 600 corporate advisers reportedly have access to the measure, including employees of Halliburton and Monsanto. “This is not mainly about trade,” says Lori Wallach, director of Public Citizen’s Global Trade Watch. “It is a corporate Trojan horse. The agreement has 29 chapters, and only five of them have to do with trade. The other 24 chapters either handcuff our domestic governments, limiting food safety, environmental standards, financial regulation, energy and climate policy, or establishing new powers for corporations.“

The Electronic Freedom Foundation is fighting the fast tract of this agreement and calling for open congressional hearings.

President Obama was scheduled to meet with the leaders of the other eleven countries negotiating the Trans-Pacific Partnership agreement ahead of the Asia-Pacific Economic Cooperation (APEC) meeting in Bali, supposedly to plan the “end-game” for this massive trade deal. However, he has made a sudden decision to cancel his trip, claiming that this was a casualty of the government shutdown. Obama’s announcement adds to the impression that goal of completing TPP at APEC has become unobtainable and reveal how precariously the negotiations are going.

There are reports that the remaining TPP country leaders who will be attending the APEC meeting will still be convening “with the aim of hammering out a framework.” As we’ve also previously mentioned, smaller issue-specific intersessional meetings have also grown more frequent and gone even further underground. So while the news of his trip getting cancelled is indeed welcome news, the TPP still could be signed even as its contents remain hidden from the public.

They also have  website “Why the Heck Should I Care About the TPP?” which lets you click through different facts about the agreement and how it will impact us as users.

We here at Stars Hollow and Docudharma urge you to take action and demand Congress exercise their Constitutional authority to oversee the U.S. trade negotiations.

Cross posted from The Stars Hollow Gazette

In his latest expose at Rolling Stone, contributing editor Matt Taibbi reports how Wall Street is making millions in profits looting the pension funds of American workers. He opens the piece with an outline of Rhode Island Treasure Gina Raimondo’s Rhode Island Retirement Security Act of 2011 and how state workers ended up funding their own “disenfranchisement”

What few people knew at the time was that Raimondo’s “tool kit” wasn’t just meant for local consumption. The dynamic young Rhodes scholar was allowing her state to be used as a test case for the rest of the country, at the behest of powerful out-of-state financiers with dreams of pushing pension reform down the throats of taxpayers and public workers from coast to coast. One of her key supporters was billionaire former Enron executive John Arnold – a dickishly ubiquitous young right-wing kingmaker with clear designs on becoming the next generation’s Koch brothers, and who for years had been funding a nationwide campaign to slash benefits for public workers.

Nor did anyone know that part of Raimondo’s strategy for saving money involved handing more than $1 billion – 14 percent of the state fund – to hedge funds, including a trio of well-known New York-based funds: Dan Loeb’s Third Point Capital was given $66 million, Ken Garschina’s Mason Capital got $64 million and $70 million went to Paul Singer’s Elliott Management. The funds now stood collectively to be paid tens of millions in fees every single year by the already overburdened taxpayers of her ostensibly flat-broke state. Felicitously, Loeb, Garschina and Singer serve on the board of the Manhattan Institute, a prominent conservative think tank with a history of supporting benefit-slashing reforms. The institute named Raimondo its 2011 “Urban Innovator” of the year. [..]

Today, the same Wall Street crowd that caused the crash is not merely rolling in money again but aggressively counterattacking on the public-relations front. The battle increasingly centers around public funds like state and municipal pensions. This war isn’t just about money. Crucially, in ways invisible to most Americans, it’s also about blame. In state after state, politicians are following the Rhode Island playbook, using scare tactics and lavishly funded PR campaigns to cast teachers, firefighters and cops – not bankers – as the budget-devouring boogeymen responsible for the mounting fiscal problems of America’s states and cities.

Not only did these middle-class workers already lose huge chunks of retirement money to huckster financiers in the crash, and not only are they now being asked to take the long-term hit for those years of greed and speculative excess, but in many cases they’re also being forced to sit by and watch helplessly as Gordon Gekko wanna-be’s like Loeb or scorched-earth takeover artists like Bain Capital are put in charge of their retirement savings.

In a preview of the article, Matt outlines three reasons to follow this scandal:

1)     Many states and cities have been under-paying or non-paying their required contributions into public pension funds for years, causing massive shortfalls that are seldom reported upon by local outlets.

2)     As a solution to the fiscal crises, unions and voters are being told that a key solution is seeking higher yields or more diversity through “alternative investments,” whose high fees cost nearly as much as the cuts being demanded of workers, making this a pretty straightforward wealth transfer. A series of other middlemen are also in on this game, siphoning off millions in fees from states that are publicly claiming to be broke.

3)     Many of the “alternative investments” these funds end up putting their money in are hedge funds or PE funds run by men and women who have lobbied politically against traditional union pension plans in the past, meaning union members have been giving away millions of their own retirement money essentially to fund political movements against them.

(all emphasis is mine)

Last week, Matt joined Amy Goodman and Juan González on Democracy Now! to discuss how hedge funds are looting the pension funds of American workers

“Essentially it is a wealth transfer from teachers, cops and firemen to billionaire hedge funders,” Taibbi says. “Pension funds are one of the last great, unguarded piles of money in this country and there are going to be all sort of operators that are trying to get their hands on that money.”