Deerfield, Riverwoods, Bannockburn and Highland Park Demanding a Special Election? Uh, Not So Much.

I attended today's State Legislative Town Hall Meeting otherwise referred to by the speakers themselves as the Garrett and May Show. Our state representative Karen May and our state senator Susan Garrett trek around their districts each year to answer questions and listen to their constituents. This year's event was held at three separate locations including Deerfield's Patty Turner Senior Center. They pretty much filled the big room at Patty Turner and that was attributed to a very well done, and much greener than a mailing, email and telephone campaign notifying residents of the event.

I think the state legislators expected to hear an earful about Blagojevich, Burris and special elections. I can see why with all the media attention telling us how mad we are and how singlemindedly focused on the issue we are. I expected it too. Well, here's a little news flash for Illinois republicans, Mark Kirk, our local mainstream media, and even Governor Pat Quinn and Attorney General Madigan. It didn't happen.

May and Garrett started by asking our opinion about the special election, and guess what? The vast majority of those in attendence at the event were against spending the money. Garrett and May also brought up the ethics problems caused by our wild west of campaign finance non-rules in Illinois. Attendees were interested in that, however, it was not the main topic of the day either. People do care about honesty in government and good use of our tax dollars, but what they were really interested in talking about today were the issues that affect them every day. The main topics were how the stimulus money will be used, education and transportation. We even spent some time on the possible dangers of those cell phone towers near schools and parks. Also big topics, usury and credit card companies (yes, they are talking usury laws in Deerfield), special ed and other issues regarding the disabled, our continued use of foreign oil, and the state income tax. No, that conversation did not go they way you may think either. Most people in the room raised their hands when asked if they would accept a state income tax increase. Many qualified their answer that they'd accept it if we could get better assurances that the money would be used where needed and not to fund pet contractors. Also generally accepted in the crowd was the idea of switching to a graduated rather than flat 3% tax. People also seemed to want to start a means test for those free METRA rides for seniors, but did not put out a strong call for them to be done away with completely. Moraine Township trustee, Bryna Gamson, brought up that seniors can already get half off by applying to their townships.

Basically, the meeting was a nightmare for Mark Kirk. Distractions are his specialty, but people are sick of them. They want action on the issues that affect them in their daily lives, want to see that stimulus money and want to see it well spent, and do worry about the well being of their neighbors and fellow Illinoisans.

I'll write more details about what was discussed at the meeting later, but it was interesting that people here are not as focused on Roland Burris as the media claims and Mark Kirk prays. State republicans and the mainstream media are really out of touch on what the people in this area care about. State Democrats in leadership should take note. I am proud to say my state legislators already have.

Roland fits right in

Mark Kirk get a block of campaign ads from the pharmceutical industry falsely claiming to be a pro-health care expansion group. Bobby Jindal makes up a story from Katrina and uses it in an address to the entire country in an attempt to build public disapproval for Obama's economic plans. Norm Coleman hides witnesses in his lawsuit with Franken over the Minnesota Senate seat.

BUT

Everyone's mad at Roland Burris and they want to spend around $50 million for a special election (rather than paying the service providers who help disabled people in our state and have gone unpaid for months).

Well, he's not my favorite, but it does seem to me that Roland fits in well with this group.

Uh, question for Mr. Jindal: If, as you argue with the false Katrina story, that government can never work, why do we trust government with our national security and to fight wars?

Ellen is...

Looking forward to Mark Kirk's record being under greater scrutiny in a statewide election.

If we are going to have to spend millions on a special election rather than helping out someone who's lost their job and insurance or providing better transportation to disabled adults trying to get to schools or jobs, I guess the consolation is that Mark Kirk will be under the statewide microscope.

Mark Kirk: No, You Cannot Have It!

Here's the high speed train system Mark Kirk doesn't want us to have because he thinks all government money is better spent on a special election so he can run for Senate this year instead of waiting until 2010.

As someone who's been tortured on that 8 hour AMTRAK ride to Minneapolis/St. Paul and again tortured on that 4-5 hour ride from Bloomington to Chicago that's supposed to be only about 2 hours, but always gets delayed by freight traffic, I'd sort of like to see this system be built.

Kirk's argument is that the stimulus creates only fake jobs because they are created by government. That, however, ignores the fact that the "fake" jobs will create real paying work for construction workers and all those needed to support the project, and that those jobs will pay real money that the workers can spend on stuff like food, medical insurance, taxes, housing, cat toys and other important things. He also ignores what we get for our money, the actual train system. Special elections, on the other hand, pay about $17 for one day to a handful of election judges, but that's real stimulus to Kirk.

Thanks to PI for headsing us up on the great train system map from the New York Times.

I'm surprised Kirk is against the shiny new train system. He's always told us in the past that he, and he alone, makes the trains run forgetting the part about the METRA engines that konk out all the time (particularly when it rains) and the long delays from waiting for freight trains.

Mark Kirk Correct. Chicago Targeted. Wrong About Targetor, Though. It's His Own Party.

Well, sometimes I have to admit that Mark Kirk is right and this is one of those times. Kirk has frequently justified his Iraq War votes and attempts to legalize warrantless spying on Americans by claiming that we have to because Chicago is at risk from terrorists. He famously replied to my question about Fourth Amendment violations by the Bush administration with "9/11-Sears Tower". I scoffed. But, I was wrong.

Now we know Chicago is in fact targeted, but not by those Kirk claimed. We have been targeted by the republican party's own Former UN Ambassador John Bolton. Here is what he said at the Conservative Political Action Conference per Mother Jones:

"The fact is on foreign policy I don't think President Obama thinks it's a priority," said Bolton. "He said during the campaign he thought Iran was a tiny threat. Tiny, tiny depending on how many nuclear weapons they are ultimately able to deliver on target. Its, uh, its tiny compared to the Soviet Union, but is the loss of one American city" – here Bolton shrugged his shoulders impishly – "pick one at random – Chicago – is that a tiny threat?"

If you are worried about nukes, you probably should be. George W. Bush with the full cooperation of Mark Kirk presided over indiscriminate nuclear proliferation. They encouraged countries to ignore the non-proliferation treaty and failed to use diplomacy to get others to join. They also presided over policies that caused the international economy to collapse. I just heard on the news this evening that times are really tough again in Russia. "Russia possesses the largest stockpile of weapons of mass destruction in the world.... [with] around 6681 nuclear weapons stockpiled in 2005, making its stockpile the largest in the world. " Maybe an economically struggling, nuclear weapon wielding Russia isn't such a good idea. They didn't care. It's a good thing President Obama does. He's working on an agreement between the US and Russia to "slash each country’s stockpile of nuclear weapons by 80 per cent". He's also working on "verifiable denuclearization of the Korean peninsula."

republicans encouraged countries, both rogue and economically struggling, to stockpile nuclear weapons. They have no business claiming their ideas on nuclear non-proliferation are better than Barack's and they have no business threatening Chicago. I guess that's what happens when people in leadership positions get away with calling Chicagoans "thugs and goons" like Kirk did in his last two campaigns.

Will Mark Kirk Cut His Staff or Will He Make Us Borrow from China So He Can Act Like a Big Shot?

Mark Kirk doesn't think we have enough money for the stimulus package or health care reform. According to Kirk, we're broke and everything we do will require us to borrow from China, a country he courted for years but that's another topic.

So, now that they are in the vast minority in Congress, congressional republicans have been asked to cut staff. republicans are using their new mantra, a resounding "No!"

I'd like to know if Mark Kirk is willing to cut his staff or is he going to make us take out a loan from China to pay them.

Mark Kirk: Great Fake Hero of Health Care

As most people in our district absorb the ads congratulating Mark Kirk for his vote in favor of SCHIP, many won't understand what is really going on. That's exactly what he's hoping for and the more that don't understand, the merrier he will be. So, here's a little recap:

First, the group running the ads calls itself America's Agenda: Health Care for Kid's Inc. That sounds like a health care reform advocacy group. Well, it isn't. It's a membership group of the pharmaceutical industry known as PhRMA, the Pharmaceutical Research and Manufacturers of America. They lobby Congress for things like loosening regulations on direct to consumer and off label advertising of drugs and preventing Medicare D from negotiating cheaper bulk rates so the taxpayer pays more and their top executives walk away with huge bonuses and golden parachutes. You can read the detail in my two previous posts.

Second, Kirk is accepting kudos for expanding health care access, but he's really against it. Kirk voted against SCHIP last year when Congress had fewer Democrats and his vote was needed. He voted for it this year because his vote didn't matter. House Democrats passed SCHIP and his vote simply did not matter.

Third, Kirk is taking credit for increasing health care access, but he's actually against it. Even today, Kirk told NPR this morning that we cannot afford health care reform. He neglects to mention that he was happy to spend trillions on a needless war in Iraq, was happy to allow the lending and financial industries to go unregulated and harm our economy and was happy to bail out wealthy bankers. Did you hear that Northern Trust used our money for a big party recently.

Just one thing, Mark. If you lead people to believe you are promising health care reform and if you win on that, either your house seat back or that senate seat you're drooling over, what do you think is going to happen when you not only fail to deliver, but actively work to prevent health care reform? I imagine Kirk just hopes no one notices. For the most part people don't and that's what keeps a guy like Kirk in office. However, in this economy, people are paying attention.

The bottom line is that Kirk owes his career to the financial and pharmaceutical industries that fund him. He's perfectly happy to spend money on bailing out the bankers and insuring profits to the pharmas, but is always tapped out when it comes to helping people who are hurting because of the excesses he supports. You, IL-10 taxpayer, have to decide if that's ok with you.

What puzzles me is why Kirk, who claims to want to be seen as a moderate and actually had campaign signs made up this past election to link himself with Obama, now walks with Bobby Jindal who refuses unemployment aid for the people still struggling in New Orleans, Sarah Palin who's busy paying back the State of Alaska for reimbursements she took improperly, and Rush Limbaugh who wants our country to fail. I would think Kirk would rather align himself with Crist of Florida or Schwarzenegger in California who don't want to see our country, their own constituencies, to fail. The only thing I can think of is that Kirk is concerned that his own party in Illinois will run someone to the right of him. So, basically, Kirk doesn't care if we fail, but sure doesn't want to fail himself. Do you think we were all put on this earth to ensure Mark Kirk a successful political career? I don't think so.

More on that Fake Kids Health Care Ad Buy for Kirk

I've been looking into this a bit more. You might remember that the ads are being run by a group calling itself America's Agenda: Health Care for Kid's Inc. That group is 100% funded by PhRMA, a pharamceutical industry group employing lobbyists who work for things like preventing Medicare from negotiating cheaper drug prices and legalizing advertising of non-FDA approved uses for drugs.

PhRMA is a 501(c)(6) and is allowed engage in limited political activities that inform, educate, and promote their given interest, but is not allowed to advocate for a candidate because donations to 501(c)(6) organizations are not required to be disclosed to the FEC. So, PhRMA creates Fake Health Care for Kids as just a plain old corporation allowed to make certain electioneering contributions to candidates under specific circumstances.

I took a further look at 11 CFR 114.15. That's the regulation that Fake Health Care for Kid's uses to justify it's ad buy. Here's the regulation. Let's take a look at the beginning:

(a) Permissible electioneering communications. Corporations and labor organizations may make an electioneering communication, as defined in 11 CFR 100.29, to those outside the restricted class unless the communication is susceptible of no reasonable interpretation other than as an appeal to vote for or against a clearly identified Federal candidate.
(b) Safe harbor. An electioneering communication is permissible under paragraph (a) of this section if it:
(1) Does not mention any election, candidacy, political party, opposing candidate, or voting by the general public;
(2) Does not take a position on any candidate's or officeholder's character, qualifications, or fitness for office; and
(3) Either:
(i) Focuses on a legislative, executive or judicial matter or issue; and (A) Urges a candidate to take a particular position or action with respect to the matter or issue, or
(B) Urges the public to adopt a particular position and to contact the candidate
with respect to the matter or issue; or
(ii) Proposes a commercial transaction, such as purchase of a book, video, or other product or service, or such as attendance (for a fee) at a film exhibition or other event.

The first thing to note is that they are talking about electioneering communications, Sec 100.29. That usually means those communications made 30 days before a primary or 60 days before a general election. That is important here because, while we are not in an election cycle at this point, Kirk wants us to be. He's a major advocate of the special election for Burris' Senate seat. If he gets his way, these communications might become electioneering communications.

Going back to Section 114. 15, these ads could fall into the safe harbor (be automatically deemed ok) if they focus on a legislative issue AND either urge the candidate to take a position or the public to take a position and contact the candidate. I don't think this fits this case. The vote is over. There is no need to urge Kirk to take a position. They are just asking people to call and congratulate him. It's a lot of smoke to cover up their intent to make Kirk look like he supports expansion of health care programs for children when he really doesn't and they don't either.

In essence, what we have here is a corporate lobbyist group that is not allowed to buy candidate advocacy ads creating a front group that is allowed to under certain circumstances. The front group stretches the meaning of the law that gives them a limited ability to buy the ads, and they do it when we very easily could have a primary election right around the corner. Even if we don't end up having the special election, this is a problem. Groups like this should not be allowed to avoid campaign finance law by creating complicated structures to make undisclosed campaign contributions. The whole thing reminds me of how Enron got away with all its frauds for so long by creating separate companies to hide liabilities. This is an insult to our district and Mark Kirk should disavow it.

Ah Ha! Fake Pro-Health Care Access Group Behind Pro-Mark Kirk Ads. They Really Represent the Pharma Manufacturers

UPDATE: I did a little more digging. PhRma is a 501(c)(6) organization. According to FEC filings, PhRma donated $11.3 million to America's Agenda: Health Care for Kids, Inc. on September 12, 2008; $1,396,722.50 on October 14, 2008; $64,505.00 on October 20, 2008 and $416,815 on October 15, 2006. Funny, all contributions late in election years. Funnier, PhRma is the only contributor to Fake Health Care for Kids, Inc.

Fake Health Care for Kids, Inc. is a corporation that makes political contributions under 11 C.F.R. 114.15. Just like Freedom's Watch, the pro-Iraq War group that was essentially Ari Fleischer and some other Bush administration connected people. Here's part of the DCCC's FEC complaint against Freedom Watch. The argument also applies to Fake Health Care for Kids, Inc.:

A corporation may make an electioneering communication beyond its restricted class only if it can be reasonably interpreted as something other than an appeal to vote for or against a clearly identified Federal candidate. See 11 C.F.R. § 114.15(a). In order to fall within the Commission's safe harbor guidelines, the electioneering communication must not "take a position on any candidate's or officeholder's character, qualifications, or fitness for office." 11 C.F.R. § 114.15(b)(2). Any corporate disbursement for an electioneering communication that is not permissible under 11 C.F.R. § 114.15 is prohibited. See 11 C.F.R. § 114.14(a)(1).

Here is the statute if you want to look for yourself.

I imagine Fake Health Care for Kids will say the ads for Kirk have nothing to do with his hope that Illinois spends multi-millions of dollars for a special election just so he can have a try at the Senate. I think the correct reply to that would be "Oh Please". The DCCC complaints against Freedom's Watch are still pending, but will probably go nowher because Freedom's Watch is kaput. Their casino backers stopped making piles of money under the weight of the economy candidates they supported created which is, I guess, some justice.

*****************************************

I wrote a few days ago about ads by America’s Agenda: Health Care for Kids, Inc. for Mark Kirk congratulating him on his vote for SCHIP and ignoring the fact that his orginal vote against it delayed it for over one year. I've been busy, but I finally had some time to do a little research. As it turns out that is no pro-health care group. Its run by the pharmaceutical companies, specifically the Pharmaceutical Research and Manufacturers of America (known as PHRMA). The group has put $11.3 million into the ad campaign supporting a bunch of congressmen and women who are friendly to the pharma industry. Now, the Kirk ads are making sense. No group favoring increased access to health care would be doing anything to support Mark Kirk because his idea of health care is preventing injured patients from suing the health care providers who injured them.

Here is how PHARMA describes itself:

The Pharmaceutical Research and Manufacturers of America (PhRMA) represents the country’s leading pharmaceutical research and biotechnology companies, which are devoted to inventing medicines that allow patients to live longer, healthier, and more productive lives. PhRMA companies are leading the way in the search for new cures. PhRMA members alone invested an estimated $44.5 billion in 2007 in discovering and developing new medicines. Industry-wide research and investment reached a record $58.8 billion in 2007.

Here is a link to it's long list of members, all pharmaceutical companies that have a long history of working for their own profits and against access to health care.

Here is what SourceWatch has to say about them:

Pharmaceutical Research and Manufacturers of America, also known as PhRMA, is one of the largest and most influencial lobbying organizations in Washington. Representing 48 pharmaceutical companies, PhRMA has 20 registered lobbyists on staff and has contracted with dozens of lobby and PR firms -- including Akin, Gump, Strauss, Hauer & Feld, Barbour Griffith & Rogers, DCI Group, The Dutko Group [1], Edelman and Bonner & Associates -- to promote its members' interests. PhRMA has a record of hiding its lobbying and PR activities, often by paying other organizations, such as United Seniors Association (USA) or the Consumer Alliance, to advocate industry-friendly policies.

It appears that the group fights to prevent regulation of those direct to consumer ads that cause people to pressure their doctors for drugs they probably don't really need, may need but there is a better alternative, or may even hurt them. The group opposes allowing Medicare to negotiate bulk drug prices. The group favors off-label advertising of drugs to doctors, a practice that caused the American Medical Association to issue this statement that while they generally supported information for doctors: "very troubling questions have been raised regarding pharmaceutical companies' manipulation of the peer-review medical journal process to promote their products." It's all about profits and sales.

This group was featured in a 2004 article on stealth pacs.

Frankly, I think it should be illegal for a group to create a front organization and claim it is for what it actually works against. As for Kirk's vote for SCHIP, it was all about getting credit for a vote that didn't matter. His vote wasn't needed to pass the legislation in the Democratic House. When his vote was needed last year, he did not give it. Seems to me Kirk worked some deal here to get the free ads for what he expects will be his Senate campaign.

Mark Kirk: Proud of Himself or Just Doesn't Care?

When I look at something like this, I wonder if Mark Kirk is proud of himself for supporting Bush's Iraq War based on lies or if he just doesn't care.

The link is to a short documentary on the New York Times website. The documentary is about the owner of a girl's school in the Taliban overrun Swat Valley in Pakistan. The short film features the school master and his 11 year old daughter who wants(ed) to become a doctor. The school master tries to keep his school open, but even his own courage is not enough because the families of the other girls are understandably afraid to take the risk of continuing to send their daughters to school. The school master does not want to leave the Swat Valley because it's his home that gave so much to him and he'd feel guilty abandoning it in hard times. He's hoping that one day his daughter will become a politician and help save Pakistan.

Mark Kirk spoke on the House floor in October 2002 and lied about his personal knowledge of WMD in Iraq. He spread the same lies in our district at his debate with Hank Perritt so he could make Prof. Perritt look foolish in front of the crowd for not supporting the war. At the time, I guess it worked, but Prof. Perritt was proven correct in the long run. It's a shame that the long run rarely matters in this country.

Then, as Kirk continued his congressional career, he continued to support every Bush war budget, every Bush war vote that failed to redeploy the troops to where they were needed more and closer to where the people who attacked us on 9/11 operated. Kirk had a very big hand in allowing the Taliban to regain their power and entrench themselves in Afghanistan and Pakistan. Kirk loved the Iraq war's ability to help him in his political campaigns. He'd tell us we had to believe him because he was in a position to know and that if we didn't, we be hurt. He repeated over and over again, "Sears Tower" "9/11" "Israel Gone while you brush your teeth in the morning". He convinced people to continue supporting him by using that fear when he knew better the whole time.

So, when I see a documentary like the one now displayed on the New York Times website, I still ask myself, is Mark Kirk proud or does he just not care.

Playing Politics With Your State

Since I'm from Illinois, I'm supposed to be so embarrassed that I'm hiding under a rock, but I'm not. At least we have a governor who has enough brains to take the stimulus money to help unemployed Illinoisans, rebuild some of our cracking infrastructure and fix some of those METRA engines that can't. Heck, even our old impeached governor would have done that. In California, they are not only going to take the stimulus, but wish they were getting more. Schwarzenegger's response to governors seeking to reject the money was:

You just tell them that anyone that doesn't want to take the money: I'm ready to take their money and rebuild California.

While Schwarzenegger is not my favorite, good for him. Sadly, Schwarzenegger, Californians and the rest of us, were deprived of more by the tax cut republicans who cannot let go of old, failed policy.

Then, there are those governors who are going to reject all or part of the simulus money to make a point that old, failed policy is the only policy they are willing to work with. Those governors include Rick Perry of Texas, Haley Barbour of Mississippi, Butch Otter of Idaho, Mark Sanford of South Carolina, and Bobby Jindal of Lousiana. Their unemployment rates are Texas: 6%, Mississippi: 8%, Idaho: 6.4%, South Carolina: 9.5% and Lousiana: 5.9%. I wonder what the people who comprise the percents have to say about it. They don't want the money because they don't want to expand jobless programs in their states. In republicanland, it's every man, woman and child for himself or herself, and they'll risk lives to make sure it stays that way.

When you think about it Mark Kirk was the leader in the push to have states refuse stimulus money. Pretty much never getting anything passed in his entire career, he pushed and managed to get an amendment into the stimulus bill that would have made it virtually impossible for Illinois to use its share had Blagojevich remained governor.

I'll venture an educated guess that the governors who seek to reject the stimulus money (and Mark Kirk who sought to make it unusable here in Illinois) are even more motivated by politics that ideology. Their effective party leader, Rush Limbaugh, has decided the best strategy for republicans is to make sure that President Obama's economic programs don't work. They want to see unemployment rise and people out on the streets because they think they need economic carnage to jumpstart their failing political careers. I hope the people of their state's don't stand for it, but with Limbaugh pounding in their ears and a general denial of the problem still entrenched in our collective unconscious, I have a feeling they'll go along with it, at least until things get so bad it becomes undeniable. Frank Rich observed in the New York Times today:

Obama’s toughest political problem may not be coping with the increasingly marginalized G.O.P. but with an America-in-denial that must hear warning signs repeatedly, for months and sometimes years, before believing the wolf is actually at the door.

It seems to me that republicans are once again playing on Americans' denial for their own political gain.

I think these governors should be required to take the money. First, politics playing has to stop. These governors should not be allowed to play with the lives of the people of their states. Second, we have to be united in stimulating the economy for it to work. We rise and fall together in this country, and contrary to many republicans, I want and have always wanted to see our country succeed.

Check out Glenn Greenwald's blog today. He wrote about the re-rise of the anti-government right. As Greenwald points out, the same people who had no problem with Bush's lying to get us into war, torture, warrantless spying on Americans, out of control spending and government expansion to the benefit of only the wealthiest 1% of the country are back to putting on their military costumes and play acting the role of fake patriot-warriors. Do they have any idea that they've been convinced to fight for the failure of America so republicans can rise again?

I guess Americans are going to have to decide if they are willing to risk their jobs, homes and families so guys like Mark Kirk can move along in their careers, gain more power and wealth.

Farewell Socks

Democat is devastated.

EarMark Kirk Part 4 and Counting

I think I've mentioned this on the blog before. I had a high school English teacher who told us that we should watch out for people who were always moralizing against others (We were reading The Scarlet Letter at the time.). In his experience (and he had been a minister before he became a teacher), he found that the ones who complained about others the loudest were usually the people with the most problems. Well here we are just a week or so out of Mark Kirk moralizing about earmarks in the stimulus package he voted against and we find his name on the list of House members who "secured earmarks for clients of The PMA Group in the fiscal 2008 defense appropriations law." More from CQPolitics.com here. Here's the defense law involved in the scandal.

They say Kirk secured earmarks in the amount of $390,000 for clients of The PMA Group. The PMA Group is a lobbying firm that represents clients mostly in the defense industry. It's most recently famous for being involved in a scandal that seems to be brewing around Congressman John Murtha and is reportedly shutting down as of March 31. For his trouble, the list shows that Kirk received $7,750 in campaign contributions. It looks like $2000 of it was for the 2008 campaign.

The press reported this story as being a problem with the Democrats, but the list of republicans is about as long. Other Illinois reps on the list are Danny Davis, Phil Hare, Ray LaHood, and Dennis Hastert.

Here's an interesting find on earmarks called the Favor Factory from the Seattle Times. They report Kirk as the lawmaker responsible for $5,100,000 in 2008 defense earmarks and report related campaign contributions from 2003-2008 of $154,400. Here's their explanation of how they got their numbers.

In January, Kirk got Roll Call to call him "the only appropriator who does not request earmarks". Oh, please.

Leave not the mansion so long tenantless

Leave not the mansion so long tenantless,
Lest, growing ruinous, the building fall
And leave no memory of what it was!~~William Shakespeare, Two Gentlemen of Verona

Of course Shapespeare is talking about love (the mansion of the heart and all that), but I'm going to talk about real mansions and tenantless buildings. Real estate, a topic I far from love. (Again postponing my promised health care post.)

I've been thinking about the Homeowner Affordability and Stability Plan. I know its going to be rough for a lot of people no matter what they do and I know they cannot save everyone, but we will have to eventually consider the problems left by the plan.

First, what about all the fraud? The plan moves forward, but doesn't address the past. It kicks out owners not deemed responsible, but what about all those lenders who talked them into it. We've already bailed them out with few strings attached. That was the bailout created under lame duck Bush that Mark Kirk favored. We have to put regulation and enforcement in place to make sure they don't use this new plan to create an entire new generation of fraud.

Also, what about all the bad lending decisions that didn't rise to the level of fraud. We're hearing so much about saving only "responsible" borrowers with responsibility defined by the amout of equity left. That leaves a huge number of properties purchased with 100% financing, those dreaded 80/20s. The sheer number of the people left out of the plan is going to leave us with an affordable housing crisis. The plan also leaves out the the investor/speculators. Sure, who cares about them, right? Thing is that the line isn't so easily drawn. A lot of people were really both speculators and homeowners, homeowners hoping to win big by fixing up their properites and flipping them. What will an owner have to prove to fit into the owner and not the speculator definition?

The number of people left out and the question of where they are going to live brings me to the next issue. We are overbuilt on one kind of housing and underbuilt on another. Sadly, the latter is affordable housing, the sort we need to house the people who lose out in the equation discussed above. In lieu of average to below average housing of the sort many people really need, we opted to flood the market with luxury condos and mcmansions. We are left with a housing stock that too many people won't be able to afford. What are we going to do with it? One possibility is that sheer population growth will take care of the problem. However, if the up and coming generations cannot lift themselves out of the lower middle and lower classes repopulated by Bush and Kirk, I don't see them snapping up the luxury housing stock. A second possiblity is that it will shake out in the market, through lower prices. I'm not sure that's what we want because it means everyone's property value has to tank. Another possibility is that some of these units are broken up much like the brownstones in New York in the 1930s. That could work in some places, in urban areas, with complications described below, but what about the mcmansions of the suburbs? Current zoning won't allow owners to chop them up. In some areas, you cannot even rent out a room without attracting the housing police. Do we ask folks who stay in their homes to live with zoning changes that change the character of their neighborhoods and lower their property values? I don't see that going over well in the IL-10. If we don't allow the changes, do we accomplish those changes anyway through inaction and natural degradation of the properties?

As far as overbuilt condominium complexes go, do we turn them back into rentals? Sounds good. How? It doesn't happen all by itself. Someone's going to have to buy those buildings and de-condo-ize them. Tenants need landlords in order to be tenants. Landlords need cash and loans to buy up buildings. If no one ponies up with the dough to buy up entire condo buildings, we don't get the rental stock back. If condos don't go back to rental buildings, do people simply rent out individual units. What about all those condo rules that don't allow individual leasing? Some owners will want rules changes, others will not. Also, what happens to the assessments on the vacant units? Do the other owners pick up the slack? Does the building do with less maintenance? If so, what does that do to the building value and eventually the value of the neighborhood. If you live in a subdivision and think none of this affects you, think again. What about that retention pond that needs cleaning every year? What about those private roads? What about that house down the street that the foreclosed out owners vandalized before the left in anguish?

Eventually all this is going to shake out, but it's going to be a lot more complicated than New York in the 1930s because we have more rules and people have more expectations. And, a lot of people are going to be left in the cold while this shakes out. Where exactly is that cold going to be? Homeless shelters? Shanty towns? Railroad cars? City streets? Suburban streets? The only thing that is for certain is that we're going to see how much easier it was for Bush and Kirk to destroy the economy than it will be for Obama to fix it.

Something we can all agree on and something we probably cannot

Roland Burris is an embarrassment and needs to go. This pretty much says what needs to be said.

So, do we let the dialogue become all Burris all the time and let those working to maintain the ruinous status quo use it as cover or do we forge ahead trying to fix our economy and get us out of needless wars started by Bush with Mark Kirk's help? I vote for the latter.

I thought false and misleading advertising was illegal

Wow. I've been writing a health care post for tomorrow and just heard a Mark Kirk television commercial from this group: http://www.americasagenda-kidshealth.org/ touting his great health care record. They are giving him, and he's glad to accept, credit for SCHIP. What a crock. I'll postpone my originally scheduled health care post to go through why it's a crock and why maybe the FTC should take a look at it for being false and misleading advertising.

First, he fails to mention that he voted against SCHIP before he voted for it. (House Vote 787, HR 3162, 8/1/07). Not only did he vote against SCHIP, but he also voted to block a vote attempting to override Bush's veto. (H.R. 3963, Vote #21, 1/23/08). SCHIP could have been settled a year ago, but Kirk didn't care. He was supporting his president Mr. Bush.

Second, he makes it sound like he cast the deciding vote when in fact it passed overwhelmingly in the overwhelmingly Democratic 111th Congress. When his votes were sorely needed to increase access to affordable health care, they weren't there.

Third, one cannot extrapolate Kirk's more recent vote for SCHIP (when it would have passed without his vote with the strong Democratic majority in the House and after the district beat him up for not supporting it in the first place) into any general support for health care. Kirk is squarely against any type of health care reform or increase to health care access. He's squarely for big money pharmas and limitations on malpractice suits as a substitute for health care reform.

Kirk's ad asks you to call him to congratulate him on his vote and support for health care. I think you should. Then ask him why he hasn't supported any other health care reform. Then tell him, since he wants credit for supporting heath care, you fully expect him to support President Obama's health care plan when it comes up sometime in the near future. Let us know how quiet it gets on the other end of the phone.

Here's my original post on Mark Kirk's real health care voting history and here it is set out again for your convenience:

Kirk voted for Medicare D in one of those late night cheat votes his party became so famous for, when it failed to allow bulk negotiation of drug prices and he failed to vote when adding bulk negotiation to the law came up. Earlier that same day, in fact just minutes before, he voted to force the bill to add a bulk negotiation provision back into committee, so it's pretty clear where his vote would have been had he bothered.

Around the same time as the original Medicare D vote, Kirk voted against allowing the import of more inexpensive drugs. Also around that same time, Kirk voted to waive the tax credit for health insurance purchase for those unemployed due to offshoring in order to allow companies that moved overseas to avoid paying taxes.

In 2004, Kirk voted against requiring newly proposed small business health associations to follow state regulations regarding coverage for breast cancer, pregnancy and childbirth, and well-child OB/GYN services. He voted the same here. States often set standards for minimum coverage that needs to be provided to protect their citizens. Federal preemption provisions like this move health care to the lowest common denominator allowing insurance companies to limit coverage to increase profits.

Also in 2004, Kirk voted against allowing employees to keep the unspent balances in their FSA accounts continuing the requirement that these balances be lost every year.

In 2005, Kirk voted for bankruptcy so-called reform that made it difficult for bankrupts to receive a discharge of medical bills.

Although a major spokesperson for the Iraq War, Kirk was not willing to do much for military or veterans health benefits either. He voted against providing military reservists with the same access to health insurance provided to U.S. military active-duty members. He repeated this vote several times on May 25 and 26, 2005. In 2006, voted against an amendment to National Defense Authorization Act for Fiscal Year 2006 that would have expanded access to the military's TRICARE health insurance program to all reservist and National Guard members for a low fee (Roll Call No. 221), and an amendment to the Military Quality of Life and Veterans Affairs Appropriations Act, 2006 which would have added veterans health care funding for combat-related trauma care to support wounded troops returning to their homes, including medical and prosthetic research (Roll Call No. 224).

In 2006, Kirk voted to allow hospitals to refuse care to poor patients unable to pay Medicaid copays.

The only medical legislation Kirk loves is that which takes away your access to the courts for real harm done to you by a health care provider. Kirk always votes in favor of limiting lawsuits and capping awards (here too). He calls it tort reform.

As far as IT legislation, little has been done in Congress on this point. There was some funding back in 2005, but it fell short of needs. Mark Kirk has provided no leadership on the issue.

None of this to mention his recent misrepresentations regarding the uninsured.

The fact is that Mark Kirk has never been there for us on access to prescription drugs or other health care needs. He's never voted for consumers or flexibility and has done little for small businesses still struggling to insure their workers, those who still try to do that. When his party was in the majority, he participated in keeping health care reform off the table completely. To Mark Kirk health care is all about limiting liability suits and capping awards for damages to the injured. It's all about insurance company profits and pushing people into HMOs that limit coverage and care.

Huh?

Mark Kirk told Chicago Public Radio that he know we need a stimulus plan. That was on February 3 when he said:

I think a stimulus package is necessary. And the one that will emerge from the Senate will have more infrastructure spending, more tax relief for small businesses to hire and less social spending on accounts that have little to do with economic developments.

If I can recall.... Mark told Waukegan that once the economy decides to cycle down there is really nothing anyone can do to stop it, basically that there is no need for a stimulus package because it won't work anyway ... on February 7.

On February 9, Kirk was busy telling WGN that the stimulus bill wasn't stimulus-y enough using discredited data.

Then on February 11, Kirk said he was for "skinny stimulus" of the sort that many economists say won't help much.

He voted against the first version of the stimulus plan on January 28.

He voted against the conference report (reconciliation with the Senate version) on February 13 and also voted to recommit and again against the conference report on that same day.

But on February 3d, he said we need a stimulus package and sort of sounded like he'd favor the Senate version, and the only amendment he could think of was that goofy one that kept the money out of Rod Blagojevich's office, but Rod was long gone before any of this got passed, so the amendment was meaningless.

So, Kirk's all over the map on stimulus, but votes speak louder than radio appearances.

Bipartisan Census Compromise

Since Jedd Gregg's departure from Commerce, we've been hearing a lot about republican complaints over current plans for the 2010 census. Apparently, they were not happy that after nominating republican Judd Gregg to Commerce, Obama moved responsiblity for the census from Commerce to the White House. The arguments, in a nutshell, are that Democrats feel the census has historically left out minorities, so it has to be monitored more closely. republicans favor the undercount and wanted Gregg to control the census because he has a history of distain for it having worked to defund the 2000 census. republicans now argue that that the census "should not be politicized", meaning of course that it should be politicized, but in their favor.

I'll stop here to note that the undercount favored by republicans might not be so easily accomplished in 2010 for reasons of their own making. The census has historically left out working people because they don't have time to fill out the forms or aren't home when the census takers call. With all the unemployment, many of them will be home and with time to kill. They also have more incentive to make sure they are counted given what their past leaders managed to do to them.

Even with time and incentive, most people still don't like the census. It takes time to fill out all the forms that ask for all sorts of sensitive, personal information. Many people will also have a problem that some temporary, part time federal worker, a total stranger, will be knocking on their door and asking for information. Even though most of these federal workers will be neighbors who need the extra $17/hour the census job pays, that's a problem in this world where no one knows or wants to know their neighbors or wants their neighbors to know anything about them.

I have a solution to all of this. I think the census should be outsourced and that Blackwater (now known as Xe pronounced "Z") should be awarded the census contract. That takes care of a bunch of problems. First and foremost, it's a bipartisan solution and isn't that (what we are being told by the media since Obama took office) the most important occupation of government. Also, it appeals to republicans love of outsourcing, and love of outsourcing to Blackwater in particular. Further, it will get Blackwater out of Iraq once and for all. Since Blackwater is a security firm and well known for its "work" in Iraq, that can be used to quell people's concerns over giving out their sensitive personal data to perfect strangers who happen to be their unemployed or underemployed neighbors needing the extra cash to feed their families. Blackwater's reputation for being over the top violent and scary, may also "encourage" people to answer the questions they are typically reluctant to answer. We'll wonder why we didn't give the contract to the mob years ago. Ultimately, and isn't it our bottom line to always come to the aid of corporations that don't pay their taxes, it helps Blackwater/Xe shed its bear paw in the crosshairs image (I guess Sarah Palin wanted the rights to that logo) and move it into the sleek cross-hair free bear paw corporate world for which it (apparently) yearns. Can you imagine Xe contractors (pictured above) knocking on your door asking to count your kids and write down your annual salary? How comforting to know the data will be safe. I'm feeling so bipartisan today. I'm sure CNN and ABC news will pick up my story in a jiffy.

Instant UPDATE:

Whoopse. I think they might have a problem with that new name. Someone appears to be using it, a Canadian foreign exchange company. I guess that's no concern to the company that has the automatic weapons.

Gun Groups Are Using republican Anti-Stimulus Position to Push Their Agenda

Today, people are emailing me about an email they've received from a group called The Citizens Committee for the Right to Keep and Bear Arms. The email's title links the stimulus bill to anti-gun legislation. The details reveal that they are complaining about H.R.45, Blair Holt's Firearm Licensing and Record of Sale Act of 2009. This bill was introduced January 6, 2009 by Rep. Bobby Rush. Blair Holt was a 16 year old Chicago student who was mowed down in crossfire on a CTA bus. The bill amends the Brady Handgun Violence Prevention Act requires each firearm to have an identification number and be licensed under a federal system created by the act or a state system certified by the Act. Rush's desire to support gun control legislation is understandable given the rash of shootings we've been seeing in the Chicago metro area lately. Just last spring there were 36 shootings in just one weekend. Just this weekend, we've seen reports of 3 shot in Chicago and one in Pilsen, another 16 year old.

I've been hearing that republicans have been sending around emails claiming that the stimulus bill contains anti-gun provisions. That is not true. This email is a little more cagey, not putting out the patently untrue claim that the stimulus bill actually contains anti-gun legislation, but claiming that the stimulus bill is being used as cover for anti-gun legislation. I'm wondering why all those evil anti-gun folks felt the need to collapse the economies of most of the world in order to get their little gun licensing bill passed, but that's just me, I guess. The gun folks also need to consider that the damage requiring the stimulus was caused by their own leaders.

My readers are wondering why they've received this email. None of them belong to the NRA or other gun groups. The only thing they have in common is that they are on Mark Kirk's email list.

I reprinted the email below. It seeks donations and asks readers to flood congress with email rejecting gun control. I just took out their contact information. If you want that, you can look it up yourself. Notice how they talk about fighting for freedom, but say nothing about NSA spying on Americans or lying to Americans to get us into war. Note also that they accuse "gun grabbers" of being "out for blood". I thought the ones using the guns were taking the blood. Here it is:

Dem's Use "Stimulus" as Cover for More Gun Control
Dear Concerned Citizen,
The liberals are at it again. In a new bill introduced the first day of the present session of Congress, and with zero coverage from the MSM, H.R. 45 (Blair Holt's Firearm Licensing and Record of Sale Act of 2009) targets all gun owners in the U.S.A. While the media the world and everyone else is focused on the "phony plan" to spend tax dollars legislation is sneeking through the House and Senate for more gun control.

This nefarious bill seeks to strip us all of our Constitutional Rights to possess and bear firearms of any distinction. It requires, within the first two years, that all new guns be registered. The bill goes retroactive after two years. Meaning that two years after the passage of the bill, ALL FIREARMS in a citizen's possession must be registered, not just those purchased after the bill passes, and this apparently applies to antique firearms as well.

Select Here to Reject Gun Bans and Fax to all 100 Senators and all 435 House Representatives Every five years the firearm owner must go through a complete renewal process for each weapon owned.

Failure to comply carries stiff penalties including confiscation of the firearms and jail time (penalties as high as ten years imprisonment in some cases). The bill also authorizes government searches without warrant, the creation of a federal bureaucracy to monitor firearm possession, etc.

The following is a summary of the bill as provided by the Congressional Research Service. If you read the whole bill, you'll find it will effectively preclude the ownership of any firearms by law-abiding people unless directly licensed by the Attorney General : 1/6/2009--Introduced. Blair Holt's Firearm Licensing and Record of Sale Act of 2009 - Amends the Brady Handgun Violence Prevention Act to prohibit a person from possessing a firearm unless that person has been issued a firearm license under this Act or a state system certified under this Act and such license has not been invalidated or revoked. Prescribes license application, issuance, and renewal requirements.

Prohibits transferring or receiving a qualifying firearm unless the recipient presents a valid firearms license, the license is verified, and the dealer records a tracking authorization number. Prescribes firearms transfer reporting and record keeping requirements. Directs the Attorney General to establish and maintain a federal record of sale system. Prohibits: Transferring a firearm to any person other than a licensee, unless the transfer is processed through a licensed dealer in accordance with national instant criminal background check system requirements, with exceptions;

Licensed manufacturer or dealer from failing to comply with reporting and record keeping requirements of this Act; Failing to report the loss or theft of the firearm to the Attorney General within 72 hours; Failing to report to the Attorney General an address change within 60 days; Keeping a loaded firearm, or an unloaded firearm and ammunition for the firearm, knowingly or recklessly disregarding the risk that a child is capable of gaining access, if a child uses the firearm and causes death or serious bodily injury. Prescribes criminal penalties for violations of firearms provisions covered by this Act. Directs the Attorney General to: Establish and maintain a firearm injury information clearinghouse; Conduct continuing studies and investigations of firearm-related deaths and injuries; and Collect and maintain current production and sales figures of each licensed manufacturer. Authorizes the Attorney General to certify state firearm licensing or record of sale systems. Like all other threats against our freedoms, we must rise and defeat this bill, slap it down hard.

Select Here Fax all 435 House Representatives
In order to stop Schumer and Feinstein and there fellow gun-grabbers—we need to let the Congress know with thousands of faxes telling them to leave guns alone. Americans like you who understand what our Founding Fathers envisioned for our nation...and who are willing to fight to defend our Constitution and for what it stands. So please, help the Citizens Committee and me defeat those who wish to gut and trash the United States Constitution.
Help me flood the U.S.

Senate and the House with the sea of FAXES big enough to drown each and every
Senator and Representative willing to vote away the Second Amendment.
Please, send your Donation and FAX TODAY!
Select Here Fax all 535 in the
Congress
Keep calling your Senators today, toll free numbers include
****************************************

AND REGISTER YOU'RE OUTRAGE at ongoing efforts to take guns away!
CALL PRESIDENT OBAMA, **********************expressing your disdain and ABSOLUTE REJECTION of all GUN BANS. DO NOT BE SILENCED – MAKE YOUR VOICE HEARD! NOTE: We need TENS OF THOUSANDS of faxes and PHONE CALLS and EMAILS delivered to ALL Senators and Representives right away!
For our projects to be successful, we must count on the voluntary financial support from individuals like you who care.

Your contribution of $20 or $25 is urgently needed today. Your donation for just $10 will help so much. If you can afford to send $50 or $100 or more it would truly be a godsend. Remember, protecting our freedom is not inexpensive. But then, it's impossible to put a price tag on freedom. Select Here NOW Send Your Most Generous Donation Together, we can preserve the Constitutional rights our Founding Fathers intended our people to have forever. For more information about CCRKBA go to ****************.

Thank you. I know I can count on you.
Sincerely,
Alan Gottlieb
Chairman
Citizens Committee for the Right to Keep and Bear Arms
If you prefer to donate by check, please mail to: ************************
The Citizens Committee for the Right to Keep and Bear

P.S. Take the Emergency Gun Survey let us know where you stand. Did you
know that since Barack Obama was elected President 3 people make a donation to
an anti-gun group every minute?
EMERGENCY GUN RIGHTS SURVEY
That's almost a million and a half contributions aimed at you — and your gun rights every year!

With Obama in the White House and anti-gunners in control of key committees in Congress, the gun grabbers are out for blood. Select Here NOW I urgently need you to fill out the EMERGENCY GUN RIGHTS SURVEY registered in your name. We at the Citizens Committee for the Right to Keep and Bear Arms have launched this new nationwide campaign to rally gun owners and freedom loving Americans behind an effort to protect our constitutional rights. THIS IS IMPORTANT. EVEN IF YOU DON'T WISH TO ANSWER YOUR SURVEY, OR ARE UNDECIDED ABOUT SOME QUESTIONS, PLEASE FILL IT OUT TODAY by SELECTING HERE.

Love of Country

It is only by rebuilding our economy and fostering the conditions of growth that willing workers can find a job, companies can find capital, and the entrepreneurial spirit that is the key to our competitiveness can flourish. It is only by unleashing the potential of alternative fuels that we will lower our energy bills and raise our industries’ sights, make our nation safer and our planet cleaner. It is only by remaking our schools for the 21st century that our children will get those good jobs so they can make of their lives what they will. It is only by coming together to do what people need done that we will, in Lincoln’s words, "lift artificial weights from all shoulders [and give] all an unfettered start, and a fair chance, in the race of life."

That is what is required of us – now and in the years ahead. We will be remembered for what we choose to make of this moment. And when posterity looks back on our time, as we are looking back on Lincoln’s, I do not want it said that we saw an economic crisis, but did not stem it. That we saw our schools decline and our bridges crumble, but did not rebuild them. That the world changed in the 21st century, but America did not lead it. That we were consumed with small things when we were called to do great things. Instead, let them say that this generation – our generation – of Americans rose to the moment and gave America a new birth of freedom and opportunity in our time.

These are trying days and they will grow tougher in the months to come. There will be moments when our doubts rise and our hopes recede. But let’s always remember that we, as a people, have been here before. There were times when our revolution itself seemed altogether improbable, when the union was all but lost, and fascism seemed set to prevail. And yet, what earlier generations discovered – what we must rediscover right now – is that it is precisely when we are in the deepest valley, precisely when the climb is steepest, that Americans relearn how to take the mountaintop. Together. As one nation. As one people. That is how we will beat back our present dangers. That is how we will surpass what trials may come. And that is how we will do what Lincoln called on us to do, and "nobly save…the last best hope of earth."~~President Barack Obama, February 12, 2009

or

Once the economy decides to cycle down there is really nothing anyone can do to stop it. ~~Mark Kirk, February 7, 2009

Valentine's Day Be My Baby

UPDATE: I'm sad to report that Estelle Bennett of the Ronettes has died.

BREAKING: Mark Kirk Votes Against Stimulus Again. He's with Rush Limbaugh wanting to see Obama and our country fail.

Here's the AP story.

From his remarks on the House floor Tuesday and Thursday, it appears he's worried about debt. Here's part of what he said on Tuesday (Thursday's remarks were pretty much a repeat):

I was just at the Bureau of the Public Debt today watching the Federal Government go $32 billion in debt, one of three public auctions. We have an enormous requirement for borrowing money, five times more than in the history of
the United States, totaling $76,000 per taxpayer if this legislation passes.

Kirk made no mention of the $1.2 trillion deficit left by the Bush administration or the money thrown down the Iraq and Afghanistan War rathole (around $1.6 trillion per CNN).

Is Mark Kirk for this Opt-In Rule?

Mark Kirk has been very vocal about his support for opt-in rather than opt-out rules. He claimed his advocacy for opt-in rules as his excuse for voting against fair pay.

OK, Mark. What about this opt-in rule for the Fed:

The Center for Responsible Lending is asking people to comment on a pending Fed rule. The Fed is torn between an opt-in and an opt-out rule regarding ATM and debit card overdraft programs. It seems that banks prefer to enroll their customers in these programs without telling them or warning them when they are about to overdraft. These programs automatically overdraft customers' accounts with high fees and at very high interest rates. CRL is asking folks to comment on the rules and ask the Fed to adopt the opt-in rule. The opt-in rule would require banks to get their customers' explicit permission before enrolling them in these overdraft programs. Consumer Reports also favors the opt-in position.

You can comment on the rule here and view comments here. I couldn't find Mark's comment favoring the opt-in position. I'm sure he'll write one soon. He has until 03/30/2009.

So much for Kirk's argument on judicial mortgage modifications

Last Saturday, Mark Kirk reiterated his position against judicial mortgage modifications. He claims allowing bankruptcy judges to modify mortgage terms in Chapter 13 payment plans will stop lenders from lending--presumably they're worried they won't get paid (further presuming they thought they were going to get paid when they handed out 80/20s to people who didn't have two dimes to rub together for a down payment). A constituent pointed out that allowing judicial modifications was the historic rule and didn'tstop lending in the past. Mark had no answer or evidence to prove his point. He just moved on to his next unsubstantiated point.

One thing is for certain. If someone is already in Chapter 13, they are in a bind. No one does that for fun, particularly since the Bankruptcy fake Reform Act of 2005. Chapter 13 is not a device to let unscrupulous people walk away without paying their creditors. That's what House Financial Service Committee meetings are for. In Chapter 13, the debtor is given a payment plan and has to complete all the payments under the payment plan to get his discharge.

Another thing is for certain. If we do nothing to make lenders talk to their borrowers we are going to end up with a bunch of failed neigborhoods. At some point, people just don't have the money to continue paying. Lenders can either throw them out or work with them. Right now most lenders appear to be opting for the latter. I'm hearing about case after case of lenders refusing to even talk to their borrowers. They give them the old run around on the phone hoping they'll go away, and there's the rub, they will go away. The lenders will own more and more empty homes that they don't really want to maintain and carry on their books until they can be sold. The rest of us will end up living next to empty and deteriorating homes. This story in the Washington Post describes empty foreclosed homes used as "havens for squatters, vandals, thieves, partying teenagers...." Kirk told us Saturday he was fighting crime in our district, but never addressed this issue.

Take a look at this Herald article on mortgage modifications. They prefer the pejorative name, cramdowns, but alas they are still the Herald even though they make some sense on this topic. Note toward the bottom of the article where the writer describes the details of the proposed legislation, the legislation Kirk is against. The law is going to apply to mortgages closed prior to the date of enactment. So, all those lenders who won't lend because of the new provision already lent on the properties the law will affect. So much for Kirk's argument.

Poison Peanuts on Wall Street

I watched a bit of the bank CEO testimony before the House Financial Services Committee yesterday. It reminded me of the poison peanuts because the banking and lending products that got us into this mess were the financial equivalent of poison peanuts. The only difference between the banking CEOs and the PCA president on the Hill yesterday is that the bank CEOs stuck around and testified rather than taking the Fifth Amendment. I have a feeling they did that because they have the idea that no one will ever hold them accountable in any meaningful way and there's the rub.

Geithner's bank bailout part 2 pretty much assures these guys that they will stay on and collect huge salaries and bonuses, so long as they're not actually called bonuses. People are forgetting that we already have rules to take care of the sort of problems these guys inflicted on us, rules developed during the New Deal. The FDIC already has the power to examine banks, take them over, remove management, merge them into others, sell them to outside investors. Despite all that power currently available, there seems to be the notion that the financial masters of the universe have to stay on top of the universe, and that people who invested in banks must never take a loss. That's pretty much the same idea that Stewart Parnell of Peanut Corporation of America had when he shipped tainted peanuts to make a buck and begged the FDA to allow him to "to turn the raw peanuts on our floor into money" (he forgot to mention that the peanuts were literally on the floor, the dirty, rat and cockaroach infested floor). He though he was entitled to his profit. The bankers think they are entitled to their large salaries and bonuses. Taxpayers appear to be only entitled to foot the bill and get sick.

To get down to the real problem in our country, we have to address compensation structures. Companies are dying from the inside out. Managers are compensated to make short term profits and preserve their place on the ladder. This pits them against their own companies as they degrade products and services, cull the heard of employees to cheapest and most compliant, stall innovation and ignore regulation all to make the numbers they need to get that bonus. Some companies are actually operating with the equivalent of less techonology than they had years ago. As old technology that has never been adequately upgraded becomes harder to fit into new situations, it's abandoned and employees go back to doing everything manually just to get something done. Some companies have more managers than workers doing the actual work. Amid all the layoffs, managers have been terminating workers while protecting managers they supervise. Middle managers look higher on the totem pole if they manage other managers rather than workers, so they keep on the lower level managers and have them fire their workers. Pretty soon everyone is managing some teeny tiny fiefdom they refuse to let go of and no one's doing the work. I imagine in some interviews, when asked how many employees they supervise, some of these lower level managers are going to have to answer in fractions.

So, how to we fix the problems? I think we need to stop rewarding stock price and start rewarding peanut company owners who actually care about peanuts and bankers care about who protecting their customers assets. We need to stop rewarding hidden problems and start rewarding real innovation. Management structures should be flattened so companies aren't throwing away money on management salaries and bonuses they could use to pay real workers. Since none of this can be measured in the short term, we need to reward long term success.

Corporations Suicidal. You'd help a suicidal addict, wouldn't you? That's why we need more regulation and enforcement of food safety laws.

Those of you who doubt my earlier comments that corporations are basically suicidal need to listen up as the Peanut Peanut Corp. of America salmonella case gets even more bizarre.

Just a few minutes ago Peanut Corporation of America president Stewart Parnell took the fifth as his testimony before House Energy and Commerce Committee. Just an hour or so before that AP came out with a story that internal emails show that Parnell knew the peanuts were tainted and had them shipped anyway to avoid lost sales. The New York Times is also reporting that peanuts were shipped before test results were in, but while testing was being done. The report also comments that PCA's answer to prior positive tests was to switch testing companies.

It is clear that our US companies need counseling. They need help understanding that life as a person (corporate or otherwise) requires planning for the future and not just the next fix (profits in the case of corporations). You wouldn't leave a suicidal addict to their own devices, so why would you leave a suicidal corporation addicted to short term profits to its own devices?

My latest question on the PCA matter is why did the employees who received the emails from Parnell make the shipments? At some point, the attitude that it's just a job and an employee is supposed to do whatever the boss wants has to stop. I think it might be easier to change attitudes if we had better whistleblower protections in this country.

Kirk gets a little lesson in Chicago

Rich Daley brought in the Illinois congressional delegation yesterday to give them a little whatfor on the stimulus package. Daley's point was that Chicago needs the money. Jesse Jackson Jr. pointed out that Mark Kirk wants money for O'Hare, but is against the stimulus generally. As reported in The Times:

"At a time when citizens all throughout our state are in desperate need of an economic life raft, Congressman Kirk's plan leaves our citizens stranded at O'Hare," Jackson said. "The Stimulus Package approved by Congress would bring $22 billion to Illinois to modernize schools, repair roads, improve hospitals and put people to work. Congressman Kirk prefers giving that money to the O'Hare Modernization Program - thus depriving children, seniors and needy people of vital services."

Airline travel has been down. Unemployment, however, is up, as are potholes.

I know Kirk and his supporters are assuming that Jackson Jr. is no longer a threat since Pat Fitzgerald's unsupported claims against Blagojevich reached Jackson's door, but it's been all quiet on that lately. It appears at this point that Jackson is just a witness. Fitzgerald got what he wanted, job security, so I wonder if anyone will ever get to the bottom of any of it. I'll go out on a limb and predict that Fitzgerald might come up with something just in time for the 2010 election primary. Surprisingly, though, despite all Kirk's great hopes that our state's misery would help him, none of it has. He's even down as against Roland Burris. That's gotta hurt. Giannoulias and Schakowsky also look good as against Kirk.

I think what's going on with Kirk is that his campaign schtick for the district was so negative against the rest of the state, particularly Chicago, that he's turned himself into a statewide persona non gratis. Couple that with his support for party over country and community on the stimulus package and you don't have a winning combination. Chicagoans need help, not Kirk calling them thugs and goons from mansions in Kenilworth and Winnetka. Mark should have listened to Dan Seals on one point in particular. Dan always said that when you've dug yourself into a hole, the first thing you have to do is stop digging.

Waiting Around for Mark

Mark Kirk has not been shy about his desire to run for the Senate in 2010. He's also not been shy about joining Rush Limbaugh and his House republican leadership in opposing any stimulus that might actually stimulate the economy. In yesterday's post, I suggested that perhaps Mark is looking out for Mark more than he's looking out for us:

Most likely, Mark Kirk is taking his nonsensical stand on the stimulus plan from republican party talking points rather than his own "thoughful and independent" mind, the independent judgment he keeps telling us about but rarely displays. republicans see their unbending opposition to the country's stimulus plan as a stimulus plan for their party. So, when you come down to it, what Kirk is doing is sacrificing the country for the republican party. Do you think that's a good trade for our congressman, the guy who represents you, to be making?

Since writing that post, I found this blog post by Robert Riech explaining how the timing of any real stimulus might really hurt Kirk's chances at the Senate seat. Riech explains:

The reason has to do with the timing of the economic recovery. If everything goes as well as possible and the stimulus and next round of bank bailouts work perfectly, a turnaround could begin as early as mid-2010. But even under this rosy scenario, employers wouldn't start rehiring until late 2010 because they'll want to be sure the upturn is for real (employment typically lags in a recovery). This means that under the best of circumstances -- assuming the stimulus is big enough to jump-start the economy and the next bank bailout big enough to get credit moving -- most Americans won't feel much better than they do now by November, 2010. Unemployment could easily be hovering close to 8 percent; underemployment, close to 14 percent; and many other indicators, still in the doldrums.

That's if all goes extremely well. But what if the stimulus isn't big enough? (I fear it won't be, given the large and growing gap between what the economy can produce at near full-employment and the meager demand coming from consumers and businesses.) And what if the bailout doesn't quite work? (It may not, given that the banking system is collapsing and many banks are actually insolvent.) The economy in November of 2010 may be worse than it is now, with no turnaround in sight.

Which brings us to the midterm elections of 2010.

I'll just ask again if you're willing to hold up your own economic recovery to make sure Mark has a better chance at that Senate seat.

Mark Kirk Wants to Abandon Mark to Market Accounting. Is he just jumping on the Rupert Murdoch WSJ bandwagon or does he have a good alternative?

In Waukegan on Saturday, Mark Kirk advocated for the abolition of mark to market accounting. Very basically, mark to market establishes a value for an asset based on its current market value. For example, a futures contract has to be assigned a value some time during the day so it can be traded or a margin assigned to it. At the Chicago Mercantile Exchange, all positions are marked to the market twice each day.

In times of economic downturn, many argue, mark to market accounting is dangerous because it leaves asset valuation to an illiquid and panicked market. Mark to market accounting can also be problematic for financial institutions holding assets that do not trade daily or belong to active markets. These assets are called Level 2 and Level 3 assets and include investments like mortgage backed securities, corporate debt, venture capital investments. They are usually marked to the market through comparison with similar assets or estimation. The increase of Level 2 and 3 assets like subprime bonds, many argue, has brought out the mark to market problems. It also appears that some financial institutions have taken advantage of the situation by moving bad assets to their Level 3 books to hide the values. See here and here too.

In times of economic upturn, some argue that mark to market accounting exaggerates the upswing by encouraging financial institutions to take more risk. I'd argue these people actually knew what they were doing when they borrowed money for which there was really no market with which to mark the assets they purchased. That's what the Lehman liability case was about. Lehman was liable for knowingly assisting First Alliance Mortgage Corporation (FAMCO) commit fraud by misrepresenting the true cost of home loans and overcharging borrowers (as much as 24%) in loan origination and other fees. I think the bottom line on the financial meltdown was that they took a gamble and many of them lost.

Apart from the fraud involved in many of the assets in question, there was also a lot of inherent risk that was simply ignored. When you think about what Level 2 and Level 3 investments are, they are just risky to begin with not even counting their difficulty of valuation. Lloyd Blankfein Executive Officer at Goldman Sachs Group Inc. Chief doesn't think the meltdown was caused by valuation problems with mark to market accounting. He thinks financial institutions simply failed to properly apply it to value assets they were purchasing. He recently wrote in an LTE to the Financial Times’s web site, "If more institutions had properly valued their positions and commitments at the outset, they would have been in a much better position to reduce their exposures." Like I said, they were gambling. I'll add, they wanted to take the gamble because they were making a lot of money in the short term.

The main problem with doing away with mark to market is with what do we replace it. Critics of mark to market want financial institutions to show their assets at book value or some percentage of book value. Book value is the cost of the asset less depreciation, amortization or impairment costs made against the asset. I really don't think that makes sense for the types of assets mark to market critics express concern over like bonds backed by subprime mortgages that were probably never worth much in the first place.

Ultimately, I think the call for abolition of mark to market accounting is an empty gimmick. If we don't value assets on their market value, we're pretty much just making it up. If we don't heed market downturns, we're just hiding from the truth and looking for more trouble. I'd also wonder why guys like Mark Kirk love the free market when it's unemploying you and making the cost of your kids food go up and hate it when their rich donors' portfolios tank.

Kirk never elaborated on his comment calling for the end to mark to market accounting. Frankly, I don't think he has a good idea for an alternative. It just sounded good, all economic and complex, parroting what the conservatives over at Rupert Murdoch's Wall Street Journal and Forbes are saying. Most people think it's too complex to understand, so Kirk knew he was fairly safe that no one would ask him to explain and in fact, Kirk was not asked to explain his comment in the meeting. I had my hand raised for an hour. The blood left my finger tips and they became all tingly. He still would not call on me.

More Misinformation Than a Grocery Store Tabloid Story About Alien Babies

After the discussion about Waukegan Harbor, and a few minutes after some initial talk about the economy, Mark Kirk's town hall meeting deteriorated into a series of odds and ends of misinformation. One man stood up to tell us all that he's a geologist and swears that global warming has nothing to do with our actions here on earth. I cannot tell you how that exchange ended because it actually required me to walk out of the room for a minute as I reminisced about the man in Palatine several years ago who lambasted Democrats for not allowing his daughter to get her social security up front and become a millionaire by investing it in the stock market. Those two men must be related.

Another person made the valid point that Kirk has always been against importing cheaper prescription drugs from Canada. Kirk defended that by saying he didn't want us getting prescriptions from China that might be dangerous, but neglected to mention his role in making trade deals with China without requiring anything from them.

Ultimately backing down on disapproval of Canadian imports and calling Mexico a "stupid" country in a gratuitous racist sounding swipe, he agreed with another constituent who said we had to be very careful to protect drug company patents because if we didn't, they wouldn't have money for R&D to come up with new drugs. I know that sounds logical, but it's really not true. I've mentioned this before, recently. The drug companies are not spending the big bucks on R&D. They're spending it on marketing. That little depressed cartoon blob guy who bounces around aimlessly until he takes an antidepressant, the woman already on anti-depressants who is still depressed and all those men on TV talking about their sexual problems get the big pharma bucks.

What is really happening is that pharmas work their patents to squeeze large amount of money out of the American public. This is from Dean Baker writing for Truthout:

Perhaps the most obvious example along these lines is patent protection for prescription drugs. The Centers for Medicare and Medicaid Services projects that the country will spend more than $330 billion in 2012 for prescription drugs. These same drugs would cost roughly $30 billion in the absence of patent protection. This means that the government's patent monopolies will be redistributing roughly $300 billion in 2012 from patients to the drug companies. (There are alternatives to patent monopolies for financing the research and development of prescription drugs.)

Take a look at this video about how drug companies extend their patents by making small changes or simply remarketing the drug for a different use. The video shows how one drug company used marketing to turn simple shyness into a mental illness and how another pushed anti-depressants to children, and yet another selling prozac under a new name to women for a new disorder that pretty much amounted to premenstral stress. These companies actually created new conditions without researching whether they really existed and made minor changes to old drugs to rename them sell them as new drugs for more money. This was all done to open markets and extend patents.

Another view comes from this New Yorker article by Malcolm Gladwell. The article begins by telling the story of "the Shark Fin Project.". This was an internal name for the remarketing of Prilosec, a heartburn medication, into Nexium. Gladwell describes how Nexium was repackaged at a higher price and kept generics out of the market. However, he goes on to describe how our pricing of prescription drugs is not just the fault of the drug makers engaging in this type of behavior. It's also the fault of doctors who prescribe these new drugs when older drugs with fewer side effect risks, or at least more well known ones, are available. The article also faults the insurance companies that don't require older cheaper drugs be tried before the newer expensive ones will be covered and publishers of reports on studies that suggest breakthroughs without scientific support. I've mentioned the FDA's role in misleading drug related publications before on the blog.

After oversimplyfying the issue of prescription drug prices, we moved to a question about outsourcing. A man in the back of the room expressed concern that companies were outsourcing jobs outside of the United States. Kirk responded that outsourcing is no longer a problem. It was another of the great benefits of global depression he lauded. What Kirk failed to tell the man is that his concern is not only still very important, but funds from the Bush/Paulson bailout arebeing used by the financial industry to outsource its workforce. That means that taxpayer dollars meant to stimulate our economy were used to pull jobs out of our economy. Bernie Sanders has introduced an amendment to the stimulus package to require bailed-out banks where there have been layoffs to hire only Americans for two years. It passed a voice vote in the Senate, but it's still unclear whether this amendment is going to survive the chopping block. I guess the Senate disagrees with Congressman Kirk when he says that outsourcing is no longer a problem.

Most likely, Mark Kirk is taking his nonsensical stand on the stimulus plan from republican party talking points rather than his own "thoughful and independent" mind, the independent judgment he keeps telling us about but rarely displays. republicans see their unbending opposition to the country's stimulus plan as a stimulus plan for their party. So, when you come down to it, what Kirk is doing is sacrificing the country for the republican party. Do you think that's a good trade for our congressman, the guy who represents you, to be making?