Tag: TMC Politcs

Once again the Department of Justice has failed to hold executives of a large corporation criminally accountable. This week General Motors agreed to pay $900 million and entered a deferred prosecution agreement to end a U.S. Department of Justice criminal investigation into its handling of defective ignition switches in many of its vehicles. They have agreed to independent monitoring of their safety systems. If they adhere and their are no further violations, GM could have its record wiped clean. That’s hardly a satisfying agreement for the families of the 124 people who died in GM vehicles that the company knew were unsafe.

And even though General Motors will pay a $900 million penalty, it was 25 percent less than the record $1.2 billion Toyota agreed to pay last year.

“I don’t understand how they can basically buy their way out of it,” said Margie Beskau, whose daughter Amy Rademaker was killed in an October 2006 crash in Wisconsin. She added, “They knew what they were doing and they kept doing it.”

During the press conference US Attorney Preet Bharara defended the settlement and his satisfaction with the internal investigation that was conducted by a law firm with close ties to General Motors.

The two law firms hired for that inquiry, King & Spalding and Jenner & Block, had previously done legal work for G.M. And court papers show that Anton R. Valukas, the chairman of Jenner & Block, who headed the G.M. investigation, helped represent the automaker in its talks with the Justice Department.

Mr. Valukas declined to be interviewed, and several corporate lawyers said such arrangements are not unusual because an outside law firm that conducts an investigation knows the facts of a case. But Deborah L. Rhode, a professor at Stanford Law School, said the public’s interest may suffer when a law firm wears so many different hats.

“It would be nice to know that the law firm doing the internal investigation was truly disinterested and didn’t have an interest in subsequent representation” of the same company, Ms. Rhode said.

Needless to say the agreement has not satified the critics of the investigation. Senators Richard Blumenthal (D-CT) and Edward J. Markey (D-MA) called it “extremely disappointing.” However, congress holds some responsibility in the inability to prosecute the auto makers:

As Danielle Ivory and Ben Protess reported at The Times in July, federal law sets a very high standard for pursuing a criminal case against people who knowingly withhold information about the risks products pose to human life. In auto cases, prosecutors have to prove corporate officers intended to defraud someone, something they do not have to do in food and pharmaceutical cases.

If it was not clear to Congress already that the law needs to change, this case should certainly make it clear. Serious safety problems in cars can be as deadly as contamination in food or drugs, and the law should treat them similarly.

G.M. used the defective switch in numerous cars and it has been linked to 124 deaths, according to compensation claims evaluated by a G.M. fund for victims administered by the lawyer Kenneth Feinberg. The fund has determined that another 275 people deserve compensation for injuries.

This is just one more failure of the Obama Justice Department who are suppose to prosecute criminals.

This past Monday, the Obama administration issued the final permits allowing Shell Gulf of Mexico, Inc. to begin drilling oil wells in the Arctic. This is the same oil conglomerate that lost control of its drilling rig in December of 2012 that crashed onto the Alaskan coast in heavy seas. The disaster also lead to eight felony convictions and a $12.2 million fine

Considering President Barack Obama’s promises to focus on climate change and big speeches on controlling carbon emissions, this has to be one of his most hypocritical decisions. Compounding that hypocrisy, the president has planned a visit to the Arctic region later this month. He is the first sitting president to do so. This decision didn’t sit well with Democratic presidential candidate Hillary Clinton who expressed her opposition in tweets and at her press conference in Nevada:

I think the very grave difficulties that Shell encountered the last time they tried to do that should be a red flag for anybody. I have been to the Arctic, I have been to Barrow, our most northernmost outpost in the United States and I think we should not risk the potential catastrophes that could come about from accidents in looking for more oil in a pristine – one of the few remaining pristine regions of the world.

In a segment on her MSNBC show, Rachel Maddow blasted the president calling this decision “the most awkward and ill-timed thing he’s done in a long time”

While we should praise Secretary Clinton for this stand and her environmental platform that put an emphasis on renewable energy, she now needs to take a stand on the KeystoneXL pipeline.

Last week the New York Tines reported that the US Chamber of Commerce was working to fight anti-tobacco measures in foreign countries:

The U.S. Chamber’s work in support of the tobacco industry in recent years has emerged as a priority at the same time the industry has faced one of the most serious threats in its history. A global treaty, negotiated through the World Health Organization, mandates anti-smoking measures and also seeks to curb the influence of the tobacco industry in policy making. The treaty, which took effect in 2005, has been ratified by 179 countries; holdouts include Cuba, Haiti and the United States.

Facing a wave of new legislation around the world, the tobacco lobby has turned for help to the U.S. Chamber of Commerce, with the weight of American business behind it. While the chamber’s global tobacco lobbying has been largely hidden from public view, its influence has been widely felt.

Letters, emails and other documents from foreign governments, the chamber’s affiliates and antismoking groups, which were reviewed by The New York Times, show how the chamber has embraced the challenge, undertaking a three-pronged strategy in its global campaign to advance the interests of the tobacco industry.

In the capitals of far-flung nations, the chamber lobbies alongside its foreign affiliates to beat back antismoking laws.

Last year the drug store chain CVS stopped selling tobacco products. Now, in light of the Chamber’s activity on behalf og the tobacco lobby, CVS has announced that it is resigning its membership.

“We were surprised to read recent press reports concerning the U.S. Chamber of Commerce’s position on tobacco products outside the United States,” David R. Palombi, a senior vice president at the company, said in a statement. “CVS Health’s purpose is to help people on their path to better health, and we fundamentally believe tobacco use is in direct conflict with this purpose.” [..]

The campaign runs counter to efforts by some of the chamber’s members. Four health care companies that serve on its board – Anthem, the Health Care Service Corporation, the Steward Health Care System of Boston and the Indiana University Health system – all support antismoking programs. [..]

For CVS, which has 7,800 locations nationwide, the move is the latest step in rebranding itself as a health care destination, rather than a convenience store with a pharmacy. The company now operates nearly 1,000 walk-in clinics staffed by nurse practitioners.

Its executives have said that selling cigarettes is not consistent with its new strategy. The company has begun offering smoke cessation programs and recently helped conduct a smoke cessation study involving its employees and their relatives and friends.

“We believe the chamber has advocated for many important causes over the years, and we thank them for their leadership on these issues,” Mr. Palombi said. “Given the leadership position we took last year in removing tobacco products from our stores, however, we have decided to withdraw our membership in the chamber.”

Cross posted from The Stars Hollow Gazette

In an article for Huffington Post, economist Dean Baker explains the basic point of Thomas Piketty’s best selling book, “Capital for the 21st Century,” which has the economic world buzzing.

Piketty’s basic point on this issue is almost too simple for economists to understand: If the rate of return on wealth (r) is greater than the rate of growth (g), then wealth is likely to become ever more concentrated.

To stem the growth of the wealth gap, Piketty suggests a “Global Wealth Tax” which in today’s global political climate isn’t likely to happen. So what can be done? Baker offers some solutions:

A new I.M.F. analysis found the value of the implicit government insurance provided to too big to fail banks was $50 billion a year in the United States and $300 billion a year in the euro zone. The euro zone figure is more than 20 percent of after-tax corporate profits in the area. Much of this subsidy ends up as corporate profits or income to top banking executives.

In addition to this subsidy we also have the fact that finance is hugely under-taxed, a view shared by the I.M.F. It recommends a modest value-added tax of 0.2 percent of GDP (at $35 billion a year). We could also do a more robust financial transactions tax like Japan had in place in its boom years which raised more than 1.0 percent of GDP ($170 billion a year).

In this vein, serious progressives should be trying to stop plans to privatize Fannie and Freddie and replace them with a government subsidized private system. Undoubtedly we will see many Washington types praising Piketty as they watch Congress pass this giant new handout to the one percent.

The pharmaceutical industry also benefits from enormous rents through government granted patent monopolies. We spend more than $380 billion (2.2 percent of GDP) a year on drugs. We would spend 10 to 20 percent of this amount in a free market. We would not only have cheaper drugs, but likely better medicine if we funded research upfront instead of through patent monopolies since it would eliminate incentives to lie about research findings and conceal them from other researchers.

There are also substantial rents resulting from monopoly power in major sectors like telecommunications and air travel. We also give away public resources in areas like broadcast frequencies and airport landing slots. And we don’t charge the fossil fuel industry for destroying the environment. A carbon tax that roughly compensated for the damages could raise between $80 to $170 billion a year (0.5 to 1.0 percent of GDP). [..]

In addition to the rent reducing measures listed above, there are redistributionist measures that we should support, such as higher minimum wages, mandated sick days and family leave, and more balanced labor laws that again allow workers the right to organize. Such measures should help to raise wages at the expense of a lower rate of return to wealth.

In an interview with Bill Moyers, Nobel Prize-winning economist and New York Times columnist Paul Krugman, talks about Piketty’s “magnificent” new book and what the 1% don’t want us to know.