McKinsey now stonewalling on details of health care "study"

McKinsey was happy to tout the study when they thought it would hurt health care reform, but now that people are asking question, suddenly McKinsey is shutting up. As Krugman, Sargent and Beutler note, that's not a good sign. Read the rest of this post...

VIDEO: Don't let mom and dad anywhere near the camera

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"30 Rock" star Tracy Morgan in serious trouble after saying he'd kill his son if he turned out gay

He's in hot water, and his apology today is not being accepted by anyone.

The story needs to be put in context. Morgan made the anti-gay comments in Tennessee, where they're trying to ban the mention of gays by teachers in public schools, and they just repealed every municipal civil rights ordinance on the books, at the request of the religious right and the business community, both of whom were upset with Nashville's new gay and trans civil rights ordinance.  It's gone now.  And all this happened just a few weeks ago.

And Morgan has a history of gay-baiting in his stand-up routines (he said being gay was a "choice" in a previous routine), but that's nothing like what he did last Friday.

He reportedly said he'd stab his son to death if the boy turned out gay.

That was after he said that people are born gay, and he knows this because "God don't make no mistakes." Get it, we're mistakes.

He said lesbians don't exist, they're just women who hate men.

He then took on the recent news on "bullying", and the fact that it's caused a number of gay teens to recently kill themselves. Apparently that's funny too. He told bullied kids to quit whining and stop being pussies.

That's when he added that he'd stab his gay son to death.

The audience ate it up with lots of "you go, Tracy!"

Yeah, well, you gone Tracy. Read the rest of this post...

Largest global banks to get easier treatment because they complained

Talk about living the life of Riley. All the rest of us got for this recession was, well, a recession. Must be nice to completely own the governments of the industrialized world. We really are a bunch of suckers as long as we keep re-electing the same old politicians who do this to us. And yes, both parties are the problem and guilty.

The world's major banks are likely to get an extra capital charge in the 2 percent or 2.5 percent range, rather than the 3 percent that has been widely reported, according to officials familiar with the discussions.

The move would likely affect major global banks such as JPMorgan, Citigroup, Bank of America, Wells Fargo, UBS and HSBC.

Officials, who asked not to be named, commented after global banking regulators met this week in Frankfurt.

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Multiple bubbles bursting in China

Brace yourself for this ride because it's going to be bumpy. I'm less convinced that the property bubble bursting in China won't have an impact on Americans, but that's only one of perhaps three bubbles bursting. It's an interesting read and not too long so click through to get more including the end which has some eye popping statistics. Read the rest of this post...

NYC Public Service Announcement - Bike Lanes

Great video about cycling lanes in NY. As today's Guardian article also points out, there are plenty of city cyclists that could learn to respect a few rules of the road. That said, a cyclist probably isn't going to kill others the way a car can do with ease. Here in Paris I see way too many cyclists who make up their own road rules and even talk on the phone while riding. I guess if you have a death wish that's fine. Read the rest of this post...

Krugman: "Rule by Rentiers"

In economics, "rentiers" are people who get their money from, in effect, renting out something they own, as opposed to those who make things to sell. Some take a dim view of economies and states where rentier capitalism dominates:

The beneficiaries of [rentier] income are a property-owning social class who, it is argued, play no productive role in the economy themselves but who monopolise the access to physical assets, financial assets and technologies. They make money not from producing anything new themselves, but purely from their ownership of property (which provides a claim to a revenue stream) and dealing in that property.

Often the term rentier capitalism is used with the connotation that it is a form of parasitism[.]

You don't have to moralize to see the point. Rentiers make money by charging a toll for access to some form of property they control.

This bring us to the point that Paul Krugman has been making for a while — that the jobs vs. debt-repayment debate is really a discussion between two social classes, creditors and debtors.

Krugman makes the point again in his column this morning (my emphasis throughout):

What lies behind this trans-Atlantic policy paralysis? I’m increasingly convinced that it’s a response to interest-group pressure. Consciously or not, policy makers are catering almost exclusively to the interests of rentiers — those who derive lots of income from assets, who lent large sums of money in the past, often unwisely, but are now being protected from loss at everyone else’s expense.

And he points the finger directly at the big-time bondholders:

Who are these creditors I’m talking about? Not hard-working, thrifty small business owners and workers, although it serves the interests of the big players to pretend that it’s all about protecting little guys who play by the rules. The reality is that both small businesses and workers are hurt far more by the weak economy than they would be by, say, modest inflation that helps promote recovery.

No, the only real beneficiaries of Pain Caucus policies (aside from the Chinese government) are the rentiers: bankers and wealthy individuals with lots of bonds in their portfolios.

And now it comes clear. Remember, bonds are an asset with a price that fluctuates. Bonds are expensive when interest rates are low, and cheaper when interest rates are high. (If this confuses you, just trust it. This is like the law of gravity; hard-coded and built in. Interest rates and bond prices are two sides of a teeter-totter, literally.)

Remember 2008, when almost all of the Global Pool of Money went into U.S. Treasuries, as a flight to safety? Those people bought at the top of the market, when Treasury bond prices were peaking and demand was through the roof. No wonder they fear-fear-fear inflation and will fight desperately against anything that looks sideways at increasing interest rates.

It's not just that they want the revenue stream to continue until all debts (bonds) are paid. They also don't want the capital losses that will occur if bond prices fall. And capital losses are a greater near-term threat than bond defaults right now.

What do bondholders fear this minute? They think, wrongly in my opinion, that if the Fed increases the supply of bonds (by borrowing more to finance increased debt), the new supply of Treasuries will drive down the price of Treasuries they already own.

As I said, it won't happen:

[H]ow could you have a clearer test of liquidity preference versus loanable funds than having the US government borrow almost $3 trillion with zero, absolutely no, effect on interest rates?

But modern rentiers (bondholders) won't even let us take that chance. Thus economic stimulus, unemployment relief, and mortgage assistance are off the table.

It's people vs. property one more time; isn't that always the way? Welcome to the next downturn, just in time for 2012.

GP Read the rest of this post...

American household wealth nearly $8 trillion less than before crash

Why has Wall Street recovered so nicely yet it's still like this for the rest? Even worse, why did Congress and the White House go along with it? The GOP may lead the way with apologies for Wall Street but the Democrats have hardly been wallflowers either. The system needed to be saved but that did not mean forgetting about the losses of the majority while ignoring the responsibilities of the minority who caused the crash. It's hard to believe this is not the direct result of our dysfunctional campaign finance laws where those with the deepest pockets dictate the rules. CNNMoney:

U.S. household wealth fell by about $16.4 trillion of net worth from its peak in spring 2007, about six months before the start of the recession, to when things hit bottom in the first quarter of 2009, according to figures from the Federal Reserve.

While a rebound in the stock market, an improved savings rate and consumer steps to reduce debt resulted in net worth gains since 2009, only a little more than half of that lost wealth - $8.7 trillion -- is back on household balance sheets.

That leaves American household wealth $7.7 trillion less than it was before the recession.

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Rep. Weiner’s district supports him 56%–33%

And in political news, it looks like Rep. Anthony Weiner's district supports him almost 2 to 1 against calls that he should resign before the 2012 election. TPM (my emphasis):

While lawmakers from Rep. Anthony Weiner's (D-NY) own party have now begun to call for his resignation, a Marist poll released Thursday night finds that his constituents think he should stay.

In the poll, 56% of registered voters in Weiner's NY-9 district think he should remain in office, while only a third (33%) think he should resign. ...

However, voters are as yet undecided on whether they'll support Weiner when he's up for reeleciton in 2012. thirty percent of respondents said they'd definitely vote for him next year, compared to 31% who said they would definitely not. A 38% plurality said it was too early to say for sure who they'll vote for in the next election cycle.

Meanwhile, in other political news, some Dems are starting to tell other Dems to STFU about Weiner, or, to put it more bluntly, "play for our team for a change." TPM again:

A growing chorus of progressives is calling on Democrats to keep their mouths shut when it comes to Rep. Anthony Weiner's (D-NY) future -- and are dismissing the Democratic calls for Weiner to step down as another sign of the timidity of the party.

It's not so much that Weiner didn't screw up royally, they say. It's that they say it's just not that big a deal, and making it into one falls into a Republican trap. And, besides, they say, as long as Sen. David Vitter (R-LA) is still walking the halls of the Capitol, why should the left be forced to lose one of its most ardent supporters?

It's not clear how far this will develop. Defending Weiner is not something many are willing to do. But for some progressives, the response to Weiner is another sign of the Democratic party letting its left wing down.

The headline for that TPM article is "Progressives Call On Democrats To Show Some Spine After Weiner Scandal," but if you inspect the link, you'll see that the writer had other growth in mind.

Cruickshank's Rule: Members of a coalition have each other's back. Democrats aren't a coalition, not with neolibs knifing progressives for sport.

But progressives can treat each other better than that; and frankly they will have to, if they expect to win anything in these post-Wisconsin years.

GP Read the rest of this post...

AT&T; gave cash to merger backers, including prominent gay group, NAACP, NEA

This has been a growing story in gay-blog land for the past several days, but finally appears to have hit the mainstream media with the involvement of non-gay groups.  AT&T has somehow received letters supporting its merger with T-Mobile from big Washington special interest groups that have nothing to do with telecom issues.  At the same time, as Politico notes, those groups receive funding from, guess who, AT&T. More from Politico:

AT&T is lining up support for its acquisition of T-Mobile from a slew of liberal groups with no obvious interest in telecom deals — except that they’ve received big piles of AT&T’s cash.

In recent weeks, the NAACP, the Gay & Lesbian Alliance Against Defamation and the National Education Association have each issued public statements in support of the deal.

The NAACP was one of the first groups to announce public support of the T-Mobile acquisition. It received a $1 million contribution from AT&T in 2009 and has received funding in the six figures dating to 2006, according to the group’s annual reports.

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Germany confirms German bean sprouts the cause of E. coli outbreak

A little bit of science would have gone a long way earlier in this process. German government ministers were much too hasty when they blamed the problem on Spanish produce and it has severely damaged their business. Raw veggies have been piling up in the stores in France as well but hopefully this should help everyone. Next time Germany should wait and see the results before dishing out blame.

Investigators have determined that German-grown vegetable sprouts are the cause of the E. coli outbreak that has killed 29 people and sickened nearly 3,000, the head of Germany's national disease control center said Friday.

Reinhard Burger, president of the Robert Koch Institute, said even though no tests of the sprouts from an organic farm in Lower Saxony had come back positive for the E. coli strain behind the outbreak, an investigation into the pattern of the outbreak had produced enough evidence to draw the conclusion.

"In this way, it was possible to narrow down epidemiologically the cause of the outbreak of the illness to the consumption of sprouts," Burger said at a press conference with the heads of Germany's Federal Institute for Risk Assessment and Federal Office for Consumer Protection. "It is the sprouts."

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Iceland crowdsourcing on new constitution

This is amazing.

In creating the new document, the council has been posting draft clauses on its website every week since the project launched in April. The public can comment underneath or join a discussion on the council's Facebook page.

The council also has a Twitter account, a YouTube page where interviews with its members are regularly posted, and a Flickr account containing pictures of the 25 members at work, all intended to maximise interaction with citizens.

Meetings of the council are open to the public and streamed live on to the website and Facebook page. The latter has more than 1,300 likes in a country of 320,000 people.

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Blair warns Labour to follow his lead, or else lose

Yes, but of course the UK did lose when it implemented Blair's policies. Maybe he's familiar with that nagging little problem called the recession? Sure the Tories have made it worse but just as the US recession has direct links to the Clinton days of free love for bankers, Blair owns his fair share of the the failed economy. Maybe if he wasn't cashing on those bankers for millions he might be able to see that others aren't doing as well. What a putz, but hey, we're talking about Tony Blair.

In his book, Mr Blair argues that traditional left-right boundaries are breaking down and that to be successful, today's politicians need to "rise above partisan politics". This reflects fears among Blairites that David Cameron, an admirer of Mr Blair's strategy, is more likely to appear above the traditional left-right fray than Ed Miliband, who is seen by voters as to the left of his party.

Mr Blair argues that New Labour, Bill Clinton's "new Democrats" and Barack Obama all reached out beyond their traditional support base and suggests the Coalition Government is trying to do the same. "Where political leaders deliberately go outside their own political base, they almost always win public approval," he says. "Face people with a choice between traditional left and traditional right and there is a traditional outcome: the left loses."

On policy, Mr Blair emphasises the need for tax rates to be competitive. He would not have introduced the 50p new top rate brought in by his successor, Gordon Brown, which Ed Miliband wants to keep for the forseeable future. "High taxes on income reduce the incentive to work," he writes.

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US extreme right shocked that Thatcher won’t see Palin

Suffering from advanced dementia, the family still finds it would be belittling for her to be a prop in the Palin freak show. And who can blame them?

Rush Limbaugh, the conservative radio host, devoted the opening section of his radio show to denouncing the "preposterous" Guardian report, as Palin supporters accused Thatcher's circle of disgracing the former prime minister.

The US conservative right reacted furiously after the Guardian reported that Thatcher's aides had decided it would be inappropriate for her to meet Palin, who is planning to visit London next month en route to Sudan. Palin has been touring US historical sites (an excursion that saw her slip up this week on the subject of Paul Revere, the American patriot who made a famous "midnight ride" to warn of approaching British forces).

One Thatcher ally told the Guardian: "Lady Thatcher will not be seeing Sarah Palin. That would be belittling for Margaret. Sarah Palin is nuts."

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