THE NEW GILDED AGE (Part 2)
THE NEW GILDED AGE (Part 2)
23rd December, 2010 0
"As societies grow decadent, the language grows decadent, too. Words are used to disguise, not to illuminate, action: You liberate a city by destroying it. Words are used to confuse, so that at election time people will solemnly vote against their own interests." â€¨—Gore Vidal, Imperial America, 2004
"When any government, or any church for that matter, undertakes to say to its subjects, 'This you may not read, this you must not see, this you are forbidden to know,' the end result is tyranny and oppression, no matter how holy the motives. Mighty little force is needed to control a man whose mind has been hoodwinked; contrariwise, no amount of force can control a free man, a man whose mind is free. No, not the rack, not fission bombs, not anything—you can't conquer a free man; the most you can do is kill him." â€¨—Robert A. Heinlein, If This Goes On, 1940
In putting together this breakdown of the top and more significant political stories, both at a statewide and national level, for 2010 I've decided to focus upon importance and detail, instead of simply recapping the most popular headlines and developments as dictated by the Major Corporate Media.
2010 marked my 31st year of publishing The Review and while I am disheartened that such little social progress has been made over the past three decades from 1979 to 2010; at no time have I been more firmly committed to the notion that what this magazine contributes to the Great Lakes Bay (and beyond, thanks to the Internet) becomes increasingly more rare and invaluable as the rise of corporate and government controlled media continues its infestation into the hearts & minds of America.
Unfortunately, the notion of an 'independent press' carries a price, which as media becomes more plentiful and competitive, driven in tough economic times by a feeding frenzy for corporate advertising dollars – the tendency for most so-called news & media outlets is to play it safe and avoid controversy and substantive content out of fear for jeopardizing their bottom line.
While this approach makes for sound business, it makes for lousy and corrupt journalism.
Of course, it also makes it more difficult to appear credible, which fortunately is a double-edged sword.
The logic behind propaganda and it's accompanying hand-maiden whore of safe & sanitary journalism, is that it is easier to sell a lie than deal in the complexities that often stem from reporting one simple truth. Investigative journalism is both costly in terms of internal investment, but also in the way reporting it can put one's bottom line at risk; so the rationale for many media outlets is 'why bother'?
But more nefarious than this understandable trend is the fact that as fewer and fewer media sources engage in 'hard' journalism, the inclination for the mass public that consumes media is to start regarding the lone voices in the wilderness as 'marginal' or 'crackpot' or somehow imparting information that is not credible; which ironically, could not be further from the truth.
At that point, though, it doesn't matter. The bad guys have pretty much won.
Credibility is not something that I believe can be traded as a commodity on the stock market; and fortunately, to counteract the force of propaganda, I still firmly believe as Shakespeare noted that eventually, 'the truth will out.'
Hence, while the following stories that appeared in the headlines of the Review this past year may not have been on the forefront of the major media radar, they are truly the ones we need to carry with us into the New Year.
We will be deeply affected by them in the days, months, and years ahead.
The Rise of the New Gilded Age
Indeed, it's looking a lot like the 'Gilded Age' of the 19th Century these days. With government unable and resistant to reign in spending, there's a gold rush on – with the price of gold going up to $1380.00 per ounce in 2010 – and the disconnect between the nation's richest and downtrodden widening as the middle class evaporates.
America continues to spend & spend, and the year closed with a renewal of the Bush Tax cuts, so basically anybody that makes over $250,000; and especially those that make over $1 million per year, will not have to worry about helping to finance the cost involved with granting one in seven Americans food stamps.
Taxpayers have put up an estimated $17.5 trillion toward guarantees, loans, and bailouts since 2008, but what do they really have to show for it? They've seen their net worth drop by an estimated $14 trillion and the number of people in the country without health coverage now totals about 50 million – just shy of the combined populations of Australia and Canada. Meanwhile, according to the Center for Responsible Lending, nearly six million homes in the U.S. have been foreclosed upon in the last three years, and another home is being foreclosed on every 13 seconds.
Banking interests have been the key beneficiaries of that $17.5 trillion in guarantees, loans & bailouts, yet they actually do have something to show for it. At top-tier firms such as Goldman Sachs and J.P. Morgan Chase, the aid has meant record profits. Along with Morgan Stanley these three entities, which received funds from the 'Troubled Asset Relief Program' will reportedly dole out an unprecedented $29.7 billion in bonuses, almost half of that by Goldman Sachs alone, meaning it will enrich its 31.700 employees by an average of $415,000 each, as reported in Vanity Fair.
As for the banking industry as a whole, Congress did pass needed legislation to hold down arbitrary increases in interest rates on credit cards; but not before postponing the effective date of the new law one year down the road, which allowed Citibank to pump up the interest rate for some credit-card holders to nearly 30 percent, with other companies soon following suit. As a whole the banking industry will take in an estimated $38.5 billion in 2010, just on charges for bounced checks. Indeed, all those myriad little extra fees now account for more than half of the industry's profits.
As for 'Government & Education', they also did quite well in 2010, thank you. According to The Free Enterprise Nation, which is a national organization representing the economic interests of those within the state who actually work and support the 'private sector' portion of our economy, the latest survey by the U.S. Government's Bureau of Economic Analysis showed that the average federal employee earns $119,982 per year in compensation & benefits, while the average private sector employee earns $59,909. To cover the additional compensation packages of government employees, $100 billion a year is taken from the private sector in income taxes.
$250 billion each year is paid for interest alone on the national debt. This would be enough to provide comprehensive health care to every American for 18 months.
Hmm. If politics is power, who is really getting the short end of the stick?
How Government Works – Greasing the Wheels
In the ten-year period beginning in 1998, financial companies spent $1.7 billion on federal campaign contributions and another $3.4 billion on lobbyists. Wise political investments enabled the nation's top bankers to effectively scrap any meaningful oversight of the financial industry.
Meanwhile, the unfunded liability for the state of Michigan's four major pensions — schools, state employees, police, and judges — is pegged at $11.6 billion, and the future health care liability ranges from $45- 50 billion. Even if the state started meeting its obligations today, it would take $2 billion annually for the next 30 years just to get even.
Good luck to our new Governor Rick Snyder and our state's elected representatives on getting that monkey back into the cage.
And while we're at it, is there any wonder the nation is so sick & tired of bought & paid for special interest politics that infests all levels of government?
Selling Off Our Natural Resources • Hydro-Fracking & Natural Gas Exploitation Portends an Ecological & Health Nightmare in Michigan
From Oct. 26 - 28, the Michigan Department of Natural Resources and Environment (DNRE) auctioned off more than a quarter million acres of mineral rights, showing increased state interest in natural gas development on local lands.
According to the DNRE, the auction yielded $10,237,261.98 in revenue after the mineral rights of 273,689.10 acres of state forest were leased. This money will be added to Michigan Natural Resources Trust Fund and used to provide assistance to local governments and the DNRE to purchase land for public recreation and protection – totally ironic given the fact that with the natural gas development, there may well be no land or viable resources left to protect.
Oil & Natural Gas companies (most principally the Encana Corporation – the company responsible for the oil spill and contamination of the Kalamazoo River this past summer - are hoping to take advantage of the state's fuel-producing potential.
Michigan's lower peninsula is at the center of a geologic bowl, known as the Michigan Basin that stretches into Illinois, Indiana, Wisconsin, and Ontario. This basin held an ancient sea about 500 million years ago, creating proper conditions for salt, natural gas, and oil deposits to form. Michigan is currently producing about 400 million cubic feet of natural gas each day from formations within the Michigan Basin.
Earlier this year, promising amounts of energy were found by Encana and its subsidiary Petoskey Exploration in the Collingwood-Utica shale formations in Missaukee and Cheboygan counties. Competing companies are hoping to enjoy success like that of Encana by harnessing fuel from similar formations throughout the state.
Another State of Michigan mineral rights auction in May brought in $178 million dollars to the state and private landowners are now being asked to lease their mineral rights for deep horizontal wells that involve hydraulic fracturing or 'hydrofracking' – a little regulated, immensely controversial, and rapidly growing mining technique that has been linked to massive ground water contamination in numerous other states ranging from Colorado to Kentucky.
Indeed, more progressive and enlightened states such as New York recently placed a moratorium on this practice; but not so here in Michigan. The cha-ching of dollar investment at the recent mineral rights auction was touched off by the results of an exploratory well drilled this year in Missaukee County, about 30 miles southeast of Traverse City.
Unlike traditional natural gas wells that tapped into the Antrim shale formation (between 600-2,200 feet deep) across Northern Michigan in the 1980s, the Pioneer well went down 9,865 feet and then drilled horizontally into the Collingswood shale formation for 5,000 feet.
The use of hydrofracking has generated massive controversy in other states such as
Pennsylvania, Colorado and Wyoming, where it has been associated with toxic spills and well
contamination, cancer, and long-term poisoning of residents.
Encana was fined $370,000 by the Colorado Oil & Gas Conservation Commission for flawed drilling practices that residents say caused methane and benzene contamination of Divide Creek in northwestern Colorado in 2004.
Because deep shale has less organic content than the shallow layers previously exploited in the '80s, the gas in these new deep shale areas is stored in micropores; and in order to get it removed in commercially viable quantities, the shale must be fractured.
The process involves drilling a hole deep into the earth and lining it with cement, which are purportedly a 'safety measure', intended to prevent hydrocarbons and other toxic materials used in the process from mixing into the water table. (Never mind that over a period of time, concrete can crack).
Billions of gallons of water are mixed with chemicals and then forced into the well. The laundry list of toxic chemicals injected into the ground during hydrofracking should be enough for State legislators to put an immediate halt to this latest move in Northern Michigan, especially in light of the Orwellian and irresponsible move navigated by ex-Vice President Dick Cheney, who managed to navigate legislation through the U.S. Congress that exempts regulation of this practice – as well as identifying the chemicals – from regulation under the federal Safe Drinking Water Act in a provision of the Energy Policy Act of 2005, which is known as The Halliburton Loophole.
Encana reported 2007 net income of $1.8 billion on revenue of $11.1 billion. So why are our legislators selling off our resources for a dollar-on-the-dime like they were running some cheap whorehouse?
This will be a MAJOR story to watch develop in 2011 and hopefully the citizenry will be outraged enough to demand action & accountability. Once the pristine resources and fresh waters of the Great Lakes are wasted or ruined, what will our state really have left?
More Environmental Concerns
One of the few bright spots in our political landscape is Lisa Jackson and the EPA, proposing strong federal regulation of toxic ash and release of the long-delayed, lobby-stonewalled, dioxin reassessment. Amazingly the state passed some environmental legislation – banning phosphorus, even though, as Lone Tree Council's Terry Miller notes, it has enough holes to drive a golf cart or semi through.
While Rick Snyder promised to be a moderate, if not progressive on the environment, one initial appointment has caused consternation – DEQ director Dan Wyant. This former Ag Director under John Engler tried to block federal enforcement of the Clean Water Act and promoted legislation that left local communities without the ability to manage large polluting industrial farms.
A former marketing director for Ralston Purina, during his tenure as Ag director from 1996 to 2005 he ushered in an era of large unregulated industrial farms in Michigan that resulted in major pollution problems.
Meanwhile, Consumers Energy continues to turn a blind eye to its coal ash problem, which puts people's health at risk. Coal ash is a concentrated toxic byproduct of burning coal and is a growing problem in Michigan. Studies have shown coal ash sites are so toxic they can increase cancer risk to a staggering 1 in 50. Consumers has had to be pushed and prodded by the state to take actions to prevent their arsenic being released into Saginaw Bay and have failed to identify the toxins in their ash and opposed federal rules identifying ash as hazardous. They've also sought and gotten special exemptions from the state for handling their waste.
Consumers has two landfills on Saginaw Bay – a 292 acre site and a 172 acre site that contain bottom ash and fly ash from decades of coal burning on the mouth of the Saginaw River. The ash was converted to slurry and piped into the landfills. Historically the landfills were unlined and the utility failed to create a barrier between bay water and groundwater from the sites. They also received several variances to allow creation of these landfills in coastal marshes and state bottom lands. Michigan coal plants generate over 2.1 million tons of ash annually.
DEA and State Cops Raid Legal Michigan Medical Marijuana Grows
Once again, this time a few weeks ago in Michigan, the federal DEA has teamed up with recalcitrant state and local law enforcement in a bid to negate the will of the public and the law of the land.
Heavily-armed state and federal lawmen raided a pair of medical marijuana gardens in the town of Okemos, outside Lansing, breaking windows, throwing smoke grenades, and seizing thousands of dollars worth of equipment and medical marijuana plants -- all in a raid of a facility that is undeniably within the confines of Michigan's medical marijuana law.
The gardens subleased to two individual caregivers by Capital City Care Givers in nearby Lansing contained a total of 40 marijuana plants. Under the Michigan law, caregivers can grow up to 12 plants each for up to five patients, as well as growing 12 plants for themselves if they are patients. That means the two caregivers should have been legally protected in growing up to 72 plants each, or 144 in total.
The apparent hole in the law that the DEA and the state police could be seeking to exploit is that the law does not directly address the issue of conjoined grows. It says only that caregivers can grow up to 12 plants for up to five patients and does not address more than one caregiver growing under the same roof. On the other hand, the law does not forbid such activities.
"This was an operation of the state police and the DEA," said Detroit medical marijuana activist Tim Beck. "The state police couldn't even get a warrant from a local judge, so the DEA had to get one from a federal judge in Grand Rapids. The state police claim that they are captives of the local prosecutor, but in this case, the local prosecutor didn't cooperate with them, so they went around him to the feds."
"We were completely in compliance with the law," said Ryan Basore, proprietor of Capitol City Care Givers, who's grow was hit. "We had contacted the local, county, and state police, and they all gave the go ahead and said we were doing it legally. We had two different attorneys write up the leases and go through plant counts and make sure everything was correctly separated. Every caregiver was well under the limit."
That didn't stop the DEA, the state police, and the Tri-county Metro Narcotics Squad from behaving as if they were busting an Al Qaeda cell. Raiding agents threw smoke bombs in the building, paraded around with AK-47s, and stole the marijuana being grown by legally compliant caregivers.
When asked about the memo that President Obama sent directing Federal agents not to come down on States that have adopted medical marijuana laws, the agents acted as if they were above the law. "Obama is not our president," Basore reported the agents saying. "The people wanted change," Basore overheard another agent say as they effectively laughed in the face of their own superiors.
"All I can tell you is that this is an ongoing investigation in which we procured the search warrant," said Detroit DEA spokesman Special Agent Rich Isaacson. "Just because someone makes a claim that it is medical marijuana doesn't make it so."
When asked about the October 2009 Justice Department memo urging the DEA to quit going after medical marijuana patients and providers in states where it is legal, Isaacson appeared to agree with the memo, but then suggested Capital Caregivers was somehow outside the state law. "If it's unambiguous that they're following state law, there would be better ways for the department to spend its resources," he said.
"Our mission is to target large scale drug trafficking groups," Isaacson said, but clammed up when confronted with the fact that the raids had seized only 40 plants. "That number may or may not be accurate," was all he would say.
The Obama administration have given pretty broad latitude to use discretion in enforcing federal marijuana laws in medical marijuana states, and it's mostly US attorneys and DEA field agents who consider their targets to be violating state or local law. The shadow of the Justice Department memo is coloring enforcement actions, and hopefully we'll see fewer raids in the future, but it's that discretion that has resulted in the continuing raids.
"The DEA has been all over Michigan trying to subvert this law, running around recommending that municipalities pass laws saying that any activity which is contrary to state local or federal law is also illegal," Beck noted. "That is being challenged in court by the ACLU."
"There will be bankruptcies filed because of this," said Basore. "Most of our caregivers are in their 60s, and they're not rich."
The BP Gulf Oil Spill
The most shocking, disturbing, and frightening story of 2010 undoubtedly concerned the Deepwater Horizon British Petroleum Gulf Oil Spill, which even by low estimates equaled three dozen Exxon/Valdez catastrophes, previously the worst oil spill ever sustained, and which in aftermath left the vast majority of cleanup workers dead due to rampant toxicity levels.
But none of these workers had to deal with Corexit, which under President Obama's authorization, the U.S. Coast Guard & British Petroleum dumped nearly 50 million gallons of this untested experimental dispersant into the ocean, creating an ecological monstrosity buttressed by 500 to 900 million gallons of crude oil.
Corexit is a chemical four times more toxic than the crude itself and its function is to literally eat the oil, obliterating it into miniscule particles. In theory these particles are biodegradeable and mix into ocean currents like loose grains of sand – out of sight, out of mind, right?
But in reality, Corexit has never actually been used on anything larger than 1000 barrels of oil. Furthermore, the chemical immediately releases the most deadly and latent properties of crude, causing the surrounding water to soak up 3,500% more of the toxic properties than it would in its natural state.
Corexit & the crude oil have already killed hundreds of thousands of fish, altering the eco-system for decades and permanently mutating the genetics of all ensnared life forms. Moreover, the EPA was not even testing for Corexit in the seafood companies are releasing from the Gulf for human consumption. But with attention starting to peer through, the FDA finally starting testing for Corexit on the seafood and now say 500 parts per million is acceptable.
In our last edition of The Review, we published a list of detailed links to information about the ongoing Gulf catastrophe, but in the two-weeks since we published those links, several have been taken down – one with the corexit ingredients in pdf form has been switched to a government issued 'cleanup' site.
Does anybody really know the story about any of this? Information is out there, but difficult to come by, insofar as Obama – through Executive Order – issued a media blackout concerning the Gulf disaster. Any journalist working Ground Zero in the Gulf is now subject to a felony charge, which carries a $40,000 fine and a maximum sentence of 15 years.
So much for freedom of speech and change that you can count upon.
In terms of covering the economic cost and toll of this catastrophe, the Obama Administration compelled BP to set aside $20 billion dollars in an escrow account to meet the needs of people and communities harmed by BP's criminal negligence.
But this is actually a great deal for BP.
The facts on the "escrow" account
The "escrow account" in 2010 is not $20 billion dollars. BP will put in $3 billion dollars in the third quarter of 2010 (ending September 30) and another $2 billion in the fourth quarter (ending December 31). Thereafter, it will have to make installments of $1.25 billion each quarter for the next three years. This means that the necessary money will not be available to pay the tens of billions in losses that are real and immediate. It also means that people and businesses will have to get in line.
The real number for the escrow account in 2010 is $5 billion—six months from now at the earliest. To put this in perspective, BP has been bringing in between $26 billion and $36 billion annually in profits on revenue of $250 billion, and pays out more than $10 billion in dividends yearly. â€¨ According to a report in Forbes, BP could absorb $35 billion in spill costs before it would have a "material impact" on its operations. But instead, it will be allowed a paltry $5 billion a year, in an installment plan over four years.
Another measure of perspective can be had by comparison of this $5 billion per year voluntary set-aside to the accumulated potential fines and penalties under the Clean Water Act. BP can be fined $4,300 per barrel of oil spilled as a consequence of gross negligence. With the recent acknowledgment that the spill volume is 60,000 barrels per day, that is a potential penalty of over $250 million per day.
Put another way, every 60 days accumulates a potential $15 billion fine under the Act. The voluntary arrangement to set aside $5 billion per year is meager in comparison.
This, of course, reflects Obama's unwillingness to exercise legal authority against BP.
Department of Justice lawyers could be initiating prosecutions for the accumulated fines, but aside from the announcement of potential investigations, this has not occurred. â€¨â€¨Obama denies that his deal with BP will function as a cap on its liability, but this remains to be determined.
The deal appears to functionally provide a shield for BP.
As one investment advisor told the Wall Street Journal, the agreement puts "an end to the financial bleeding," and allows investors to assess what BP's total liabilities might be. So while President Obama stresses that the plan is not a cap on liability, it certainly appears as one. The installment terms of the payments themselves limit the amounts that will be made available while people are seeking claims.
The U.S. Supreme Court Once Again Puts An End to Democracy as We Know It
The need to control influence peddling by corporate lobbyists has consistently eroded at the fabric of our democracy ever since the Watergate era of the 1970s, and perhaps even further to the explosion of the Military Industrial Complex back in the 1960s.
The corrupting influence of unregulated corporate lobbying has impacted and denigrated every key piece of legislation currently before Congress, from health care reform to environmental protection and beyond.
But just as many states have started to enact 'Pay to Play' legislation to roll back the reigns on influence peddling, the recent U.S. Supreme Court decision in the case Citizens United vs. FEC has managed to overturn over a century of precedent while opening the floodgates for unlimited amounts of corporate money to flow into our political system. Shockingly, the court's decision may even allow foreign corporations and large multinationals to manipulate our elections and undermine the very foundation of our democracy.
Remember the names: Alito, Kennedy, Roberts, Scalia, and Thomas – the same crew that threw centuries of precedent out the door back in the year 2000 when they interfered in the Florida recount that wound up giving the presidential election that year to George W. Bush in their now infamous Bush vs. Gore decision.
In an unprecedented perversion of judicial power, the court decreed that corporations have a free-speech 'right' to dip into their corporate coffers and spend unlimited sums of money to elect or defeat candidates of their choosing.
Never mind that U.S Constitution and Bill of Rights speaks of 'people' instead of corporations in its language; the notion that the act of spending money is actually protected 'speech' is patently absurd, because as Bob Dylan once wrote, 'Money doesn't talk, it swears'. And let's face it; the Court has also ruled that obscenity can be regulated.
No other group in America comes anywhere near the spending clout that this relatively small group of wealthy special interests wields over elections and our government. The notion that the corporate voice is a victim of political censorship is not merely judicial activism at its worse; it is truly judicial radicalism.
Thomas Jefferson warned about the dangerous rise of corporate power, declaring that we "must crush it its birth the aristocracy of our moneyed corporations." But sadly, over the decades, much of the wisdom of our founding fathers has been lost in tidal wave of dollars spilling into contemporary politics.
Has our Republic been lost in a corporate coup d'etat?
Consider these works from the recent Citizens United case by Justice Stevens in his dissent:
"In a democratic society, the longstanding consensus on the need to limit corporate campaign spending should outweigh the wooden application of judge-made rules. The majority's rejection of this principle 'elevate[s] corporations to a level of deference which has not been seen at least since the days when substantive due process was regularly used to invalidate regulatory legislation thought to unfairly impinge upon established economic interests.' Bellotti, 435 U. S., at 817, n. 13 (White, J., dissenting).
At bottom, the Court's opinion is thus a rejection of the common sense of the American people, who have recognized a need to prevent corporations from undermining self-government since the founding, and who have fought against the distinctive corrupting potential of corporate electioneering since the days of Theodore Roosevelt. It is a strange time to repudiate that common sense. While American democracy is imperfect, few outside the majority of this Court would have thought its flaws included a dearth of corporate money in politics."
The U.S. Supreme Court's recent decision in Citizens United violates every principle of constitutional decision-making — and will be remembered as a judicial ploy intended to tilt the 2010 elections.
The Court's majority, in overturning the prohibition on corporate and union funding for election ads, went out of its way to declare a major Congressional law unconstitutional, even though its bedrock procedural doctrines dictate that the Court should avoid doing so whenever possible.
The Citizens United case thumbs its nose at all that. First, the Court addressed and decided an issue not brought by the parties. Citizens United, an advocacy nonprofit that took little corporate money, renounced in the trial court its "facial challenge" that the corporate prohibition on funding independent political ads was unconstitutional in all circumstances.
Citizens United asked the Supreme Court to decide only whether the corporate funding prohibition was unconstitutional "as applied" to them in their narrow fact situation. The Court decided on its own to address the facial challenge, holding the statute unconstitutional as applied to all corporations, even for-profit corporations, in all circumstances.
There was no evidence in the record that there were exceptional circumstances; and the Supreme Court would be hard pressed to prove them, since the country has had a corporate campaign prohibition since 1907 and we have had no apparent shortage of vigorous free speech.
Second, the Court easily could have decided, if it had wanted to, the case for Citizens United without addressing the constitutional question. It could have held that the statute, which banned corporate and union funding of television ads referring to federal candidates within thirty days of a general election, did not apply to a video-on-demand movie, as was involved in this case.
But instead they decided to upset the entire apple court,
And now we, as citizens, have to deal with all of this in upcoming year of 2011.
As Edward R. Murrow said, 'Good Night, and Good Luck'.
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