advice from a fake consultant

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Tuesday, June 29, 2010

On Music Appreciation, Or, I’m Taking The Day Off

It is a huge news day today, what with death and confirmation on everyone’s mind…and I’m not going to do anything about it—well, not today, anyway.

Instead, I’m taking the day off to bring you something more compelling: a music appreciation class, with recordings old and new, and just right for your summer soundtrack.

And if that’s not enough…by an amazing coincidence, we also get to talk about the (I never even know it existed) McRice burger, and, just for a summer bonus, we even have a smoking hot male model to grab your attention.

It’s all about fun today, so let’s get right to having some.

The stars of midnight shall be dear
To her; and she shall lean her ear
In many a secret place,
Where rivulets dance their wayward round,
And beauty born of murmuring sound
Shall pass into her face

--From “Three Years She Grew”, by William Wordsworth

So here’s what’s going to happen: I put together a playlist of songs with the idea of getting you to listen to artists that you may not know, either because you’re not an old geezer like me—or because you are.

Some of the songs will be “that song” from an artist, but other songs are designed to get you to explore the larger body of work that an artist has brought to the table; I’ll be telling you about those as we go along.

I’ll give ‘em to you in the same order as I used to assemble the playlist—and they do fit together, in this order, quite well, even to the point that if you set up for continuous play, the last and first songs also “match”.

Grizzly Bear is getting real big this year, so much so that they had a song in a Super Bowl commercial, and I’m just crazy about the song “Knife”.

If you can imagine modern doo-wop and 50’s guitar licks getting together in a very understated way, that’s this song. The version I used comes from a live performance they did at KEXP’s Seattle studios; you can hear it here, along with four other songs they did that day. There’s a disc available with that performance, but it’s the sort of thing you’d really rather find in a used CD store; there’s also a Grizzly Bear page at RCRD LBL with free and legal downloads of other songs. (The “original” version of the song is on the Yellow House album.)

Now here’s a trippy story: William DeVaughn was a Washington, DC sewer designer (he trained as a draftsman) who nailed it on the first try with Be Thankful For What You’ve Got, which has become one of the greatest soul recordings ever.

Over the intervening 35 years it’s reported that he has been in and out of the industry; Wikipedia reports he returned to working at the drafting table. His own website,, is just a “placeholder” site today, suggesting he’s again inactive “in the biz”.

Remember the smoking hot male model? He’s also named William Devaughn (no capitalized “V”), and he became famous first for being on Pinoy Big Brother, then his McDonald’s McRice burger commercials (“modern rice for modern times”) in the Philippines.

He models today, which explains this picture of him in a “banana hammock”—and if you’re reading this at The Bilerico Project…well, trust me on this one, you probably do want to go click on the link…and, you know, when the straight guy in the room tells you to go check out the nearly naked man picture, you really should.

But now, back to music: there are few voices that ever graced a stage that can outshine Aretha Franklin’s, and Night Life is one of those songs that were just made for her and a horn section to absolutely own.

If you don’t know her yet, learn about her, now: start with the popular stuff, like “Spanish Harlem”, but understand that the real treasures are a bit less well known, with “Drown in My Own Tears” or “Good To Me As I Am To You” or “Son of a Preacher Man” (yes, Virginia, Aretha did it, too) being at the truly soulful heart of her collection.

Are you old enough to remember Timbuk 3? The video for The Future’s So Bright, I Gotta Wear Shades was hugely popular on MTV, back in those halcyon days when MTV played music videos, but the next album, “Eden Alley”…that’s the one. It’s full of great songs; my favorite among several is Easy, which is a complex, layered mix of guitar, vocal, percussion, and harmonica that I just can’t hear often enough.

CBGB was the jumping off point for punk legends like the Ramones—but it was also the spot where the Talking Heads found their groove. This is another one of those bands who have a whole shelf of “hidden gems” (check out the spectacular “Fear of Music” or “Stop Making Sense” albums sometime); we’re going with Mind today. It’s rhythmic, it’s a great big “wall of sound” production…and it has a hypnotic quality about it that has you kind of wishing the song didn’t end so soon.

If you haven’t really listened to a lot of new music since Nirvana, then you don’t know about Gorillaz. We need to fix that instantly.

Gorillaz is an odd amalgam of cartoon characters that were created to form a framework upon which a variety of songs that tell stories about the character's adventures could be hung; that’s an imperfect explanation of what they do, but not a bad one.

The songs themselves evolve over time, with “Clint Eastwood” being an excellent example. I have four different version of the song, each much different than the other; the Phi Life Cypher version, for my money, being one of the best rap performances you’ll find anywhere.

Today we reach out to the title track from the Demon Days album (start about 2:15 into this video for the full effect), which is an orchestral and choral piece, believe it or not; the London Community Gospel Choir provides the vocals, which is something they’ve done a lot of over the years.

Meat Beat Manifesto is another one of those bands that the older of you have never heard of—and again, we need to fix that. For whatever reason, these Brit bands manage to really grab reggae by the horns, and the “…In Dub” album does it better than most.

Super Soul Dub is exactly that: a super-duper dubstyle song that will take you away from Babylon and have you feelin’ irie in no time at all.

From the new to the old: Sarah Vaughn is one of the great voices of the 20th Century, “Fever” is one of the greatest songs of any century, and the two were combined, with some help from producer Adam Freeland, to create a modern, very danceable version of an old classic originally made famous by Peggy Lee.

Verve Records, the jazz label, has been reissuing some of their classic singles in paired CD releases, the “Verve/Unmixed 3” and “Verve/Remixed 3” pair, within which reside the original and new versions of this song, are my favorite so far.

I am forever guilty of letting these stories get too long, and we’re already at about 1000 words, and we’re only halfway through this lesson…and all of that means we’re going to need a Part Two, tomorrow.

So far, we’ve covered a lot of ground; tomorrow we have more dance, more reggae (in English and French), a bit of reworked Beatles, one of the greatest jazz songs ever, and a 50-year-old classic from the guy many people credit with inventing the electric guitar.

It’s a beautiful day, so go get outside, have some fun, check out the new music…and we’ll see you back here next time.

Sunday, June 27, 2010

On Really Padding The Résumé, Or, “Vote For Me! I Died In Viet Nam”

We have already seen some impressive efforts in this campaign season to do a bit of résumé padding, particularly as it regards things military; so far Illinois’ Mark Kirk has managed to turn himself into a kind of camouflage Austin Powers, while Connecticut’s Richard Blumenthal’s trying to catch up with some “Vietnam” service of his own that no one else in the theater of operations exactly knew about.

But now, in the race for Alabama Governor, we may have seen something that takes us to a whole new level of “inflation”: the Republican candidate is running an ad that not only suggests that he served in Vietnam…it seems to imply that he actually died there, and has now come back to save the State.

Which is some serious irony indeed, considering that the candidate is actually a medical doctor.

And with that, let me introduce you to the either living…or undead…Dr. Robert J. Bentley.

“I have fought for Queen and Faith like a valiant man and true;
I have done my duty as a man is bound to do;
With a joyful spirit I Sir Richard Greenville die!”
And he fell upon their decks, and he died.

--From The Revenge, by Alfred Lord Tennyson

Now as regular readers know, I post far and wide, including at Left in Alabama, where our friend mooncat has been running with this story, which is how I became aware of the events we’ll be talking about today.

On Thursday, she was up with a post I particularly want you to see, and I’ll explain why in just a second, but before I do, I just wanted to acknowledge her excellent work.

So here’s the deal: the Bentley for Governor Campaign has been running an ad called “A Man’s Word”, which is one of two ads that give the impression that Bentley served in Vietnam, even though he did not serve there.

In this ad, a list of names appears about six seconds in, and remains visible for about three seconds, along with an image of a fighter aircraft and a banner that says: “Hospital Commander Vietnam War”; a reference to his three-month stint as the interim commander of the base hospital at Pope Air Force Base, in North Carolina.

Here’s the ad, for your perusal:

Now if you go and check out mooncat’s Left in Alabama posting, she’s gone to the time and trouble to do a screen grab of the “list”, along with pointing you to the second questionable ad.

It needs to be addressed further, but I’m going to ignore that other ad, for today…and that’s because, to me, the list of names, including the font, the background, and the method of writing branch of service and “conflict served” all looks just a little too much like either the panels used at the Vietnam Veterans Memorial Wall or the design of a US military gravestone.

"If you want to use issues to define people as to where they stand on the issues, that's fine," Bentley said. "But you shouldn't distort the facts."

--Robert Bentley, to Michael Tomberlin of The Birmingham News, May 17, 2010

So if Bentley did actually die in Vietnam…could he still be elected?

As it happens, there is some precedent here. Mel Carnahan, who was dead at the time, put the whup on John Ashcroft pretty good in their 2000 Senate contest; unfortunately Missouri’s closed-minded Acting Governor Roger Wilson was not willing to let Carnahan actually serve in the office, appointing his wife instead.

Which brings us to the final question: could the undead actually serve in office?

Have you ever met my Congressman, Dave Reichert?
Steve King?
Louie Gohmert?
Michelle Bachmann?
Arizona Governor Ann Brewer?

Any one of those people could have appeared in Zombieland, and I’ll let you decide which is your favorite later.

They’re also all serving in elected positions today, suggesting the undead can in fact hold high office—and if you need an even better example, Dick Cheney has been undead at least a couple of times, which didn’t keep him from serving as the 43rd President of the United States.

And with that, we come to the “let’s wrap it up” part of the deal:

Dr. Robert J. Bentley, the Republican nominee for Governor of Alabama, is running ads that either intentionally or “accidentally” inflate his military record by making you think he served in Vietnam…or he actually died there and he’s now walking the Earth as one of the undead and a medical doctor, bringing his unique perspective on end-of-life issues to the People in the best way he knows how.

I wish I knew which it was; my efforts to obtain some sort of comment about any of this from the Bentley Campaign were unsuccessful…which is probably a good idea if you’re running ads that suggest you were in Vietnam, when you really weren’t, and you know you’ll eventually be facing some incoming fire of your own.

It’s already been a pretty hot summer in Alabama.

Let’s see if we can’t spread this story around and make it even hotter for Dr. Bentley…because if anybody deserves to be in a warm place, it’s someone who tries to take advantage of the way we feel about those who die for this country.

Thursday, June 24, 2010

Republicans Intervene In Traffic Accident, Call Settlement “Shakedown”

Brighton, Colorado (FNS)—Attorneys from the Republican Study Group (RSG) descended upon the 17th Judicial District courtroom of Judge John T Bryan today to present an amicus brief and associated oral arguments in order to prevent a settlement in a lawsuit related to an automobile accident in this Colorado city.

The intervening attorneys claim the settlement reached between the two parties to the accident is a “shakedown” because the plaintiff had not yet exhausted all possible legal remedies when the agreement was finalized, and because the agreement was executed in the presence of the plaintiff’s brother, a well-known local attorney.

They hope Judge Bryan will decline to approve the settlement in today’s hearing, and that he will order the parties to move forward to trial.

“What we have is government transferring property from one party, an admittedly unattractive one, to others, not based on preexisting laws but on decisions by one man, a car czar”, said Crush Mimbaugh, attorney for the RSG, “and we are here today to protect all Americans from this legally sanctioned rape of an innocent driver.”

The facts of the case are as follows: Ms. Maya Normousbutt, a resident of Brighton, was taking her kids to the corn maze and haunted house at Murray Farms, also located in Brighton, when her parked vehicle was struck by another car driven by a Mr. Dick Timoneous, of nearby Northglenn.

Mr. Timoneous was placing a note on Ms. Normousbutt’s car when she returned to the parking lot and discovered that the accident had occurred.

Over the course of the next several weeks, she obtained several estimates for the damage, her insurance company paid for the repairs, and, during a meeting at her brother’s law office that he helped to arrange, she, the defendant, and all insurance companies involved made an agreement to resolve all remaining issues in the lawsuit that had been filed on her behalf to effect recovery of damages.

Republican Study Group attorney Moe Barten presented this argument to the Judge during the hearing:

“We have a system in America built up based on the British tradition over 200 years of due process and fairness, where people that -- that do bad things or, in this case, a person that's responsible for a bad accident, we want to hold them responsible, do what we can to make the liable parties pay for the damages.

I'm speaking now totally for myself. I'm not speaking for the Republican Party. I'm not speaking for anybody in the America but myself, but I'm ashamed of what happened in that attorney’s office yesterday.

I think it is a tragedy of the first proportion that a private individual can be subjected to what I would characterize as a shakedown, in this case, a $2000 shakedown, with an attorney, who is legitimately conducting a investigation and has every right to do so to protect the interests of his client, participating in what amounts to a $2000 slush fund that's unprecedented in our nation's history, that's got no legal standing, and which sets, I think, a terrible precedent for the future.”

Barten continued for several more minutes; unfortunately, the official transcript only records him as saying: “Harrumph, harrumph, harrumph” the entire time.

Near the end of the morning’s presentations Barten’s co-counsel, Bon Joehner, introduced a novel legal concept:

“I think the people responsible in the car accident—Mr. Timoneous and the federal government--should take full responsibility for what's happening there…”

Ms. Normousbutt’s attorney, Harry Paratestes, Esq., offered a statement during the lunch recess:

“We are very disappointed at the RSG’s efforts to become involved in this case.

My client, and her insurance company, were hoping to create a simple way to avoid litigation so that all claims might be promptly settled; if the RSG prevails we will have years of legal battles ahead of us before anything can be resolved and the plaintiffs in this case can be made whole for the damage done to them by the responsible party.

You know, folks, all we’re trying to do is get paid back for getting her bumper fixed, and I have no idea why the RSG has a problem with that.

We also cannot understand why the taxpayer should be stuck with even one penny of the bill for fixing my client’s car, and we surely can’t figure out why Republicans would want the taxpayer to bail out Mr. Timoneous, or his insurer, for his bad driving. I mean, talk about moral hazard…

…After all, it’s not like Uncle Sam was behind the wheel that afternoon; it was Dick Timoneous.”

So, guess what, Gentle Reader: once again we’re using satire to make a larger point, and once again all the speeches were slightly modified from the actual words of Rush Limbaugh, Joe Barton, and John Boehner—and I figured I’d better bring this to your attention now because I know I did such a good job of “obfuscating” the names in the story that no one would probably ever figure it out if I didn’t.

And just for the record, there really is a Judge John T Bryan, and his Court was added to provide a very real location for this very fake story—and I hope he has a sense of humor about that—and even more importantly, I hope he realizes that nothing was said about him here, defamatory or otherwise, except to acknowledge his existence.

Finally: I just can not, for the life of me, figure out how Republican consultants gather around a conference table and say: “Hey, why don’t we try to stick this one on the taxpayer—and then make sure we tell the public how much we support that idea…loudly.”

But then again, I guess that’s why I’m a fake consultant, and they’re real ones.

Tuesday, June 22, 2010

On Taming The Financial Beast, Or, Sausage Gets Made, You Get To Watch

While we’ve all been busy watching the “oil spill live cam”, a similar uncontrolled discharge has been taking place in Washington, DC

In this case, however, it’s lobbyists that are spilling all over the landscape as the House and Senate attempt to merge their two visions of financial reform.

They’re trying desperately to influence the outcome of the conference in which House and Senate negotiators have been engaged; this to craft the exact language of the reconciled legislation.

There’s an additional element of drama hovering over the events as eight House members, including one of the most vocal of the Republican negotiators, face ethics questions related to this very bill.

The best part: if you’re enough of a political geek, you can actually watch the events unfold, unedited and unfiltered, from the comfort of your very own computer.

So far, it’s been amazing political theater, and if you follow along I’ll tell you how you can get in on the fun, too.

Two cows are standing in a field. One says to the other, “What do you think about this mad cow disease?”
“What do I care?” says the other, “I’m a helicopter.”

--From Plato and a Platypus Walk Into a Bar, Thomas Cathcart and Daniel Klein

So the way today’s story starts is with a bit of “Advanced Schoolhouse Rock”: it is not unusual for a Bill to advance from the House to the Senate, where the Senate passes an amended, and therefore different, version of the same Bill. The two versions have to be “reconciled”, after which both sides agree to the final language that will become law.

The House-Senate Conference Committee on financial regulation has been meeting to reconcile the Restoring American Financial Stability Act of 2010; last week’s first three sessions having already been presented, in all their geeky glory, thanks to the good graces of the Members of Congress involved and C-Span.

The exact mechanism of one of these conferences goes something like this:

A single large piece of legislation is not unlike a book, in that there are Chapters, which are organized into Titles, which, together, become an Act.

Conferees work through one Title at a time, beginning with an “offer” presented by either the House or Senate conferees. The Members on the other side debate the offer, amend it as they see fit, and present a “counteroffer” to the other side.

At some point both sides find the language acceptable, and one side “accedes” to the other’s offer. From those offers and counteroffers a “conference report” is prepared; this becomes the legislation’s final language that is sent back to the House and Senate for final votes.

A conference report cannot be amended, by either the House or the Senate. If a filibuster is threatened in the Senate, a “cloture motion” will end debate, allowing a final (simple majority) vote to immediately take place. Passing a cloture motion requires 60 votes. (For the super geeky, a Senator’s “motion to proceed” to voting on a conference report cannot be filibustered.)

Assuming things work out, the now “enrolled” measure will be sent to the President for the signature that changes a Bill to a Law.

The negotiation process has lasted three days now, with both sides agreeing to abolish the Office of Thrift Supervision and give the authority to the Comptroller of the Currency (that was in Title III), establish rules over hedge funds (Title IV), develop new insurance regulations (Title V), create all kinds of new rules for credit rating agencies, the SEC, those who advise on and issue municipal bonds, and those who set executive compensation levels (Title IX), and to address issues related to the Federal Reserve (Title XI).

And it’s this process of finding agreement that is the real “sausage-making” part of the deal, with Republicans such as Texas’ Jeb Hensarling trying to either amend the thing to death or talk the opposition into some kind of compliant stupor.

Unfortunately for the Republicans, House Committee on Financial Services Chair Barney Frank (Surprisingly Average Fundraising For His Position-MA), who is also the lead member of the House delegation to the Conference, has been driving this harder than a Desert Dueler in second place in the Baja 1000—and it has been a joy to watch. (His Senate counterpart is Connecticut’s Chris Dodd.)

Along with Hensarling, Frank duels with Ranking Member Scott Garrett (Jacked Up Real Good-NJ), and the resulting reality TV is funny, infuriating, incredibly frustrating...and incredibly important.

Which brings us to today.

At noon Eastern, the Conference Committee meets again, and the House offer includes Title X language, which is the consumer protection part of the legislation.

As that offer stands right now, the Senate’s version of a new Consumer Financial Protection Bureau would be in this Conference Report, along with rules protecting the States who regulate this stuff more closely than the Feds, new rules on debit card fees, and rules that regulate all sorts of currently unregulated financial activities.

Excepted from those rules would be car dealers and pawnbrokers.
More about that later.

Title XIV, relating to mortgage lending, is also on the agenda. Included is a provision providing emergency mortgage relief for unemployed homeowners.

Finally, rules relating to “risk retention” (how much risk can a regulated institution’s assets represent?) will be addressed.

The rest of the week promises even more fireworks, as the question of how derivative instruments are to be regulated—or not—will be taken up by the group.

Which brings us to car dealers.

We now know that eight members of the House, including at least two who are part of this Conference Committee (Republican Jeb Hensarling and Democrat Mel Watt of North Carolina) are being investigated by the Office of Congressional Ethics for suspiciously timed fundraising related to the very bill we’ve been discussing here.

Watt held a fundraiser on December 9th of last year, and just a matter of a day or so later his proposal to toughen the regulation of those car dealers...was mysteriously withdrawn. Watt himself has no comment, except to say that he is innocent in every way...which seems like a comment, but who am I to be all persnickety about it?

So how about that?

We have a big-time debate over the financial future of this country being played out right in the open for you to watch, with all the dirt and drama of a telanovela whose plot involves trillions of dollars of wealth and divas as far as the eye can see.

There’s corruption, and people who think the fix is in—and people who know that, whatever they do, they’re gonna lose; all of it should be required viewing for anyone who isn’t quite sure why government matters, and even more so, for those who do.

WARNING - Blatant Self-Promotion Ahead: It's Netroots Nation time once again, and the fine folks at Freedom To Marry have chosen me as a finalist for their Blog 4 Equality contest. If I am one of the chosen, it's off to July. You can vote for that Don Davis guy here, which is my "in person" name, once every 24 hours, so vote early and often. Voting ends June 25th. Thanks very much, and we now return you to your regular programming.

Monday, June 21, 2010

At Black Tie Ceremony, Feith Passes Torch To Barton

Honestly, I am absolutely sick of commercial air travel these days. Just dealing with security is bad enough, but then there’s the airlines, and...hey, all you really need to know here is that there has to be a pretty good reason for me to fly cross-country.

Well, I had one Saturday night, which is how I came to be in the Colonnade Room of the Fairmount Hotel, Washington DC with about 250 of my closest friends, in a classic shawl-collar tuxedo, attending one of the most exclusive “passing of the torch” ceremonies in recent Washington memory.

And when it was all over, Douglas Feith was a happy man.

Respect to your great place! and let the devil
Be sometime honour’d for his burning throne.

-- Duke Vincentio, from William Shakespeare’s Measure for Measure.

There are probably some of you who are thinking: “That Feith name is familiar, but why?”

You know the name because, as Undersecretary of Defense for Policy, he was the guy who basically planned how the Bush Administration would run the Iraq War.

To suggest he was not exactly a genius in the job would be the charitable interpretation; General Tommy Franks is famous for referring to him as the “dumbest mother@*&#er alive”, which is the official title he’s carried ever since.

But on Saturday night, the torch was passed.

And by the time the speeches had ended, and the applause had died down, Texas’ Congressman Joe Barton was the new keeper of the sputtering flame.

This was not the outcome most observers expected.

When my invitation arrived on Monday, it looked as though BP’s Tony Hayward would be wearing the sash and carrying the scepter (for those who don’t know, the scepter is a gold-colored three foot long extension cord...and if that’s the stupidest thing you ever heard in your life, you get the idea), having basically earned himself a “Lifetime Achievement Award” in a mere 60 days.

This was going to be tough for Hayward, of course, because he was already planning to skip his Farr 52 (I’m told he calls it Bob) in the 79th “Round the Island” race, back home in the UK on the same day (and he had a good race, too, coming second to Leopard).

But before BP could really address the question of who would accept the award on his behalf, Congressman Barton pulled off an amazing feat; eclipsing Hayward’s 60 days of corporate idiocracy in a mere five minutes by actually apologizing to BP for the Obama Administration’s insistence that they don’t go through all the necessary legalities before BP actually begins paying claims for damages.

Considering how he got the title in the first place, it’s fair to say Barton’s acceptance speech began with some classic “message confusion”...

“...Where I come from what we'd do about it would be take 'em out and string 'em up...We wouldn't go through the legalities that we have to because of our due process...”

...and then went on to include a few more pearls of wisdom:

“...If homosexuality was normal we wouldn't any of us be here...You have to have heterosexual behavior in order to recreate the species...”

“...In January 2009, I introduced the College Football Playoff Act of 2009. This isn't a government gridiron takeover. It simply says that the BCS can't call a game the "national championship" unless the participants are determined by a playoff. It doesn't dictate what kind of playoff or how many teams have to be involved—those decisions would rest with the BCS or NCAA.

The biggest complaint about my bill is that Congress shouldn't get involved. While this doesn't rise to the level of healthcare reform or climate change legislation, it is more important than honoring the 2,560th anniversary of the birth of Confucius—one of dozens of resolutions passed by the House in the past few months (I voted against it)...”

Luckily for me, my own prior life experience as a caterer had prepared me for the evening; I had tipped our server at the beginning of the meal, and with the amount of wine available at the table, I was already well enough along that there were no “spit takes” during Barton’s speech.

Possibly the happiest person in the room was BP Chairman Carl-Henric Svanberg. When I caught up to him over a glass of champagne he was happy to explain Hayward’s absence, although it’s clear he really isn’t a native English speaker:

“After it became obvious he wouldn’t be leaving with the award, I told him he needed to get back and replace Captain Neil; that he should handle the “Bob” himself, and I talked to him today, and he said he got all the way to second...”

At which point I just couldn’t take any more, and the interview came to an end.

And it’s at this point that I should say that while this story really didn’t happen, and that this was satire, Barton’s “acceptance speech” was actually assembled from his own very real words, found here, here, and here.

I should also say that in real life Doug Feith might have actually caught a break here; but with several months left until November, and the Republicans looking more and more “self-defeatable”, if I were Joe Barton I wouldn’t be building any expensive “shrines” for his new accoutrement, as another awards transfer ceremony could be coming up sooner than anyone thinks.

WARNING - Blatant Self-Promotion Ahead: It's Netroots Nation time once again, and the fine folks at Freedom To Marry have chosen me as a finalist for their Blog 4 Equality contest. If I am one of the chosen, it's off to July. You can vote for that Don Davis guy here, which is my "in person" name, once every 24 hours, so vote early and often. Voting ends June 25th. Thanks very much, and we now return you to your regular programming.

Friday, June 18, 2010

On Slicing Pies, Or, Mystery Fees Cause Retirement "Money Spill"

It’s part two of our “Netroots Nation Goes To Vegas Piano Bar Extravaganza”, and in keeping with tradition that means we are again taking a story request.

This time we won’t be talking about energy security or “climate security”; instead, we’ll discuss retirement security, keeping your money for yourself instead of paying it out in “mystery fees”, and how one of the “usual suspects” is at it again.

And if all that wasn’t enough...we also have pie.

And when the Pye was open’d
The birds began to sing,
And was not this a dainty dish
To set before the King!

--Charles Lamb, writing to Miss Sarah James, April, 1829

So here’s what’s going on: about 50 million Americans have one of those 401(k) retirement plans.

The concept behind these plans is that you put money into an investment account of some sort, and the money accumulates, tax-free, until you withdraw it after you retire.

These accounts are “managed” by financial services firms, who collect fees for the service.

Lots of fees, for all kinds of services.

The problem is that not all of these fees are fully disclosed to investors. In fact, it’s legal for an investment firm to deduct some amount of money out of the mutual fund that you’ve put your money into...and not tell you how much they took.

Part of the House’s vision of financial reform legislation requires the managers of these monies to fully disclose, up front, before you invest, and on every statement afterward, what fees are being collected; an amendment before the Senate would remove this protection—and here’s where the “usual suspects” part comes in: we have this amendment thanks to our good friend...wait for it...Senator Max “I love healthcare reform—as long as those healthcare industry checks keep coming in” Baucus, he of the Senate Finance Committee.

The US Department of Labor says that you could lose as much as 28% of your money, over time, to these hidden fees, and that’s a pretty big slice out of your retirement pie.

To illustrate the point Congressman George Miller, chair of the House Committee on Education and Labor (following the requisite press conference) dispatched his minions to deliver 72% of an apple pie to each member of the Senate Finance Committee Wednesday, as you can see in this video, courtesy of Mr. Miller’s office:

What about the other 28%?

That was replaced with a big red wedge that reads “Wall Street’s Cut of Your 401(k) Pie” before the pies were boxed up...and it was actually a nice presentation, if I may say so myself.

So exactly who got the pies?

With no effort made to change the names for the protection of the innocent, here’s a list of the members of Senate Finance, along with their States and affiliations:

Max Baucus (Oy, Vey!-MT)
Jeff Bingaman (Big-Time Lobbyist Wife-NM)
Jim Bunning (Nutty-KY)
Maria Cantwell (Used to be Rich-WA)
Thomas Carper (Once Accused of Designing a Regulatory Deathstar-DE)
Kent Conrad (Countrywide VIP Home Mortgage Program Participant-ND)
John Cornyn (Compensating...-TX)
Mike Crapo (Big-Time Lobbyist Daughter-ID)
John Ensign ("Wanna Donate To My Legal Defense Fund?"-NV)
Mike Enzi (One of Those C Street Guys-WY)
Chuck Grassley (Against Healthcare Reform...Until He Was For It-IA)
Orrin Hatch (Supports Drug Testing For Unemployment Benefits-UT)
John Kerry (John Kerry Walks Into A Bar, The Horse Says “Hey: Why The Long Face?”-MA)
Jon Kyl (Wants Joe Arpaio to Enforce Immigration Law-AZ)
Blanche Lincoln (Damn Near Fired-AR)
Robert Menendez (Never Convicted-NJ)
Bill Nelson (Had His Own “Flight Suit” Moment-FL)
Pat Roberts (Is America's Phone Tapped?-KS)
John D. Rockefeller IV (Actually Wanted a Public Option-WV)
Charles Schumer (Will Go Upstate-NY)
Olympia Snowe (Always the “Possible Republican Vote”-ME)
Debbie Stabenow (Can't Live With 'Em...-MI)
Ron Wyden (Geek-OR)

This is another one of those stories where getting ahold of one or more of these Senators, in the next few days, could matter quite a bit if it’s your pie that’s at stake...and even if it isn’t, why should fund managers get to charge “mystery fees” to anybody?

So get to it, now, because if you do, you may be able to afford more ice cream to go with your pie later.

WARNING - Blatant Self-Promotion Ahead: It's Netroots Nation time once again, and the fine folks at Freedom To Marry have chosen me as a finalist for their Blog 4 Equality contest. If I am one of the chosen, it's off to July. You can vote for that Don Davis guy here, which is my "in person" name, once every 24 hours, so vote early and often. Voting ends June 25th. Thanks very much, and we now return you to your regular programming.

Thursday, June 17, 2010

On Prioritizing, Or, Senate Democrats: Regulating Climate Change, Or Not So Much?

Netroots Nation will be in Las Vegas in just a few weeks; with that in mind we are going to play “piano bar” and fulfill a couple of requests, one today and one tomorrow, from folks who would like to bring a couple of things to your attention.

Today’s topic: climate change.

As you know, there is a lot of legislation floating around Capitol Hill that would begin to use some sort of market-based mechanism to reduce the amount of carbon we emit.

None of it will move unless it moves through the Senate, and today, that’s what we’ll be talking about.

Matter of fact, they will be too.

Oh, there must be a cloud in my head,
Rain keeps falling from my eyes,
Oh, no they can't be teardrops,
For a man ain't supposed to cry.

--From the song Raindrops, by Dee Clark

Climate change is on the minds of Democratic Senators this week in a big way, with a lot of legislative proposals floating around the Hill at the moment. Some of those apply some sort of pricing mechanism to the carbon emissions coming out of the smokestacks of America’s largest polluters (also known as “cap-and-trade”), and that is highly controversial, even among some Senate Democrats.

(If you guessed that Senators Blanche Lincoln, Mary Landrieu, and Ben Nelson are among the objectors…you get a cookie. What you might not expect is that Dianne Feinstein, of California, is also an objector.)

On Tuesday Majority Leader Harry Reid met with a group of Senators seeking to advance climate-change legislation, on Wednesday the Senate Democratic Caucus heard from Reid about the politics of climate change over lunch, and today, a second luncheon will take place.

I’m being told that by the time that lunch is over the Caucus will have decided whether they will, or will not, move forward on climate change legislation this year. The question of whether the bill will include a cap-and-trade provision may well be decided at this luncheon as well.

It’s been difficult to move a bill through the Senate, what with the fact that Republicans have been trying to force virtually every bill that comes before the body to garner 60 votes, and it seems highly unlikely that a bill with a cap-and-trade provision would be able to meet that burden.

One compromise solution might be to pass a smaller bill and then introduce an amendment on the floor that would introduce the cap-and-trade provisions; the logic here being that amendments can be added with a simple majority vote, instead of a 60 vote “supermajority”.

I want to wrap this story up before we get too long, so let’s review where we’ve been, and then bring today’s proceedings to a close:

Climate change legislation is at a critical juncture, and the question of whether the Senate will move forward with anything at all is likely to be decided today.

The options include moving forward with the largest plan possible, a smaller plan that can then be amended to include cap-and-trade, a smaller plan with no cap-and-trade amendment, or no action at all.

If you have an opinion about any of this, and you have a Democratic Senator or two, you need to make a phone call, this morning, to let them know how you feel.

So get to it, right now, as all the reporting suggests the decision is literally going to be made in the next few hours.

Tuesday, June 15, 2010

On Poor Management, Or, Did You Know There Was Another Deepwater?

It is by now obvious that even after we stop the gentle trickle of oil that’s currently expressing itself into the Gulf of Mexico (thank you so much, BP) we are not going to be able to get that oil out of the water for some considerable length of time--and if you think it could take years, I wouldn’t bet against you.

While BP is the legally responsible party, out on the water it will be up to the Coast Guard to manage the Federal response, and to determine that BP is running things in a way that gets the work done not only correctly and safely, but, in a world of limited resources, efficiently.

Which brings us to the obvious question: can the Coast Guard manage such a complex undertaking?

While we hope they can, you need to know that the Coast Guard has been trying to manage the replacement of their fleet of ships and aircraft for about a decade now…and the results have been so stunningly bad that you and I are now the proud owners of a small flotilla of ships that can never be used, because if they go to sea, they might literally break into pieces.

It’s an awful story, and before we’re done you’ll understand why Deepwater was already an ugly word around Headquarters, years before that oil rig blew up.

“I am the very model of a modern Major-General,
I’ve information vegetable, animal, and mineral,
I know the kings of England, and I quote the fights historical
From Marathon to Waterloo, in order categorical;
I’m very well acquainted, too, with matters mathematical,
I understand equations, both the simple and quadratical,
About binomial theorem I’m teeming with a lot o’ news –
With many cheerful facts about the square of the hypotenuse.

--William S. Gilbert and Sir Arthur Sullivan, The Pirates of Penzance

We’re going to try to keep today’s story relatively short (we won’t succeed, I’m afraid), and that means I’ll be a bit tighter with words than I would be normally, so let’s get right to the heart of the matter:

The US Coast Guard (USCG) works its ships and aircraft too hard, with inadequate downtime; as a result an old fleet is even older than its years.

Just like an old car, you have to work harder at maintenance, but things keep breaking down, and the costs really start to add up.

It’s not entirely their fault: they have more and more to do, especially after September 11th; they’re also expected to operate farther from home, and the tours of duty are longer.

At the same time the money they get to do it all keeps going down.

This circle had to be squared.

A decision was made to begin planning for the modernization or replacement of pretty much everything USCG owns that operates out in the deep water (that’s more than 50 miles from shore), and that’s how the Deepwater program was born.

Total assets involved: roughly 90 large ships, over 100 small boats, about 250 aircraft, and not quite $25 billion dollars.

USCG was convinced that they did not have the ability to manage this sort of program on their own, and they decided to procure everything from one prime contractor, a Lockheed/Northrop Grumman partnership.

The idea was that they would tell the contractor what they wanted the finished product to be able to do (in this case, the product was a fleet of ships and aircraft that could interact as a system), and the contractor would determine how to manage the program to completion.

With the “management” part of the process out of USCG’s hands, all the Admirals would have to do was “supervise” the contractor to make sure things were on time and on budget.

They did that by creating teams that would each watch over a small portion of the bigger picture, coordinating with each other and USCG senior management.

The next step was to determine what ships and aircraft to build; today we’ll concentrate on just four elements of the system, which should be enough to make the picture clear.

--The Coast Guard owned a number of 110 foot patrol boats, and they decided to refurbish them, to provide new capabilities within a 13-foot longer hull. This required the ships to be cut apart, and then reassembled.

As it turned out, that idea sucked.

One way to interpret the results would be to say the first eight newly-delivered craft were so unseaworthy (the hulls of the “brand-new” ships were actually cracking), so full of electrical problems, and so unable to protect classified communications that they never entered service, and they will be scrapped.

Another view: for quite some time Baltimore was continuously guarded by eight Coast Guard vessels, and the city was incredibly safe—as long as none of them had to actually leave the pier or do anything.

The loss: about $100 million. USCG is trying to get the money back.

“It’s going to be difficult to counter the bad publicity we’ve had despite the best efforts of our communications team,” admitted J. Rocco Tomonelli, director of Coast Guard business development at Northrop Grumman.”

--From the article Coast Guard May Face Rough Seas as it Takes Control of Deepwater, National Defense Magazine, October 2007

--USCG needed a big ship with the ability to operate as far away as the Middle East, and the National Security Cutter was it.

The job required that the vessels delivered had to be structurally sound for use in the North Pacific’s very rough seas for 30 years. The contractor was convinced the ships were sound, the Coast Guard was not, and the Navy was brought in to settle the argument.

USCG won, the taxpayer, again, lost.

An odd, but not surprising, solution was found. If USCG would just agree to not ask that the ships be so annoyingly capable, everything would be fine…so they did; this was done by assuming the ships would be at sea fewer days every year.

We now know that USCG expected some of the ships’ structural components to only last three years in actual service.

In 2006 it was reported that the first two hulls may or may not be fixable, and may have to be scrapped.

The first ship delivered, the Cutter Bertholf, was not allowed to perform any missions for almost seven months after commissioning due to its own failure to perform as expected. In October 2008 Bertholf conducted its first “shakedown” cruise and officially entered operational service.

More of these ships are being built, with fixes hopefully in place. Two are in acceptance trials; a funding request exists that would expand the fleet to five.

Our cost?
At least $650 million per ship.

--USCG planned to buy a dozen Fast Response Cutters; the contractor wanted to use newfangled composite hulls, reportedly for longer life and less maintenance.

That idea also sucked.

Officially, and I quote: “…the cutter design satisfied contract terms but did not meet Deepwater mission needs.” The resulting ships were judged to be too heavy and lacking in performance.

It is suggested that the contractor wanted to build this type of hull because they had a new composite facility available and there was money to be made. We’ll discuss that in a minute.

The plan now is to build the ships with metal hulls.
USCG is not attempting to recover the lost money on this one.

--USCG wanted Unmanned Aerial Vehicles (UAV) for the new ships. A fancy-schmancy tilt-rotor design that was already somewhat developed had to be abandoned because they couldn’t afford to produce the thing.

Current thinking is to steal something from the Navy’s UAV development program, stick a USCG radar system on it, and call it good.

The GAO and the Congressional Research Service have been looking into all this, a lot; they feel USCG has failed to properly resource the teams that are supposed to be supervising this process.

Excessive workload, transferring people in and out, failing to put team members in locations that are close to other team members, and failing to fill leadership positions were all issues noted in the reports.

The idea that the contractor would “own” the whole process, might work against USCG interests, and that USCG would be at their mercy was also noted. (Remember those fiberglass hulls?)

We’re told that teams working on the National Security Cutter tried to warn USCG senior management about the problems with the first few ships, and that they were ignored.

Total cost of all the mistakes: more than $1.5 billion.

Frankly, this is all Admiral Stuff, and the Admirals at USCG have nothing to be proud of, based on this part of the record.

USCG is now trying to turn all this around by taking over management of the program themselves, and although there is reason to believe things may be somewhat better, even that “fix” is creating problems.

For example, it’s reported that USCG is moving ahead on acquisition decisions even though they haven’t fully decided what the designs should be.

At this point, however, USCG has little choice: they can’t wait several years to train up a new crew of contract managers, then design, then build.

That’s because, right now, things are very bad for the Fleet: of the first 12 ships USCG sent to help after the earthquake in Haiti…10 broke, at various times, and that kept them from conducting rescues until they were fixed. Two of those had to return to the US for major repairs.

And here’s where the circle closes.

Admiral Thad Allen, who’s running the show on the Gulf Coast, spent the past four years as Commandant of the Coast Guard, and before that as Coast Guard Chief of Staff…which means, for good or for ill, he’s covered in Deepwater all the way up to his Cutterman Insignia.

The question now is: was he the reformer who fixed this stuff when he finally got the chance, or was he part of the problem in the first place?

I could not get the answer to this most critical question, so all I can tell you is to watch very, very, carefully—and don’t be afraid to assume the worst, until we truly do know better.

Monday, June 14, 2010

On Saving Louisiana, Or, Send Me Your Mud, Yearning To Be Free

AUTHOR'S NOTE: This is a story I originally posted in March of 2007 that seems so important right now I've brought it back for your consideration.

Let’s begin today’s discussion with a quick thought experiment.

What is the single most important thing necessary to ensure the survival of the State of Louisiana?

Improved government administration?
More and better levees?
The success of the “Road Home” project?

I submit it is none of these.

The single most important factor determining the future of the State of Louisiana is mud.

That’s right, mud.

Were you aware that the entire State consists of mud? When you look at a geologic map, there is nothing to be seen but sedimentary deposits dating back to the Cambrian period.

And the mud, it is a-sinking.

Katrina took out more than 57 square miles of land in Plaquemines Parish alone. That former land is now the Gulf of Mexico.

The Army Corps of Engineers has maps of the Mississippi river from 1998. When you get to the page, click on map 141. What you see is a portion of Plaquemines Parish. (Here’s the same place on Google Maps.)

Notice almost the entire map area consists of water, canals, and marsh. There’s only two narrow strips of solid ground evident. Now let’s pull out a bit. There’s just about nothing in the image but sinking ground. Now pull out just a little bit further, and guess what-there’s New Orleans.

This was the area of Louisiana most affected by Katrina.

It’s now time for you to meet Professor Oliver A. Houck. His essay “Can We Save New Orleans?”, published in the Tulane Law Journal, will be central to the remainder of this conversation, and I would encourage you in the strongest terms to take the time to read the document.

Here are some of the issues he brings to light:

--There is no consensus on what is to be done-should the emphasis be on maximizing the amount of developable land; or should the emphasis be on maximizing opportunities for natural processes to replenish the bayous? These are two mutually exclusive goals, and Houck suggests development is winning.

--The Federal government is responsible for maintaining navigation on the Mississippi, but flood control is managed locally. As a result of this and the huge amounts of money that are spread around through levee and other water control project construction, politics has more influence on the management process than science and inter-jurisdictional coordination.

--Environmental pollution-especially fertilizer runoffs-kill the marsh grasses that hold the soil together. As a result, the process of saving Louisiana starts in South Dakota, and is therefore a national, not just a State problem.

--It is easier to calculate the cost-benefit of industrial and commercial activity than the cost-benefit of saving lives-and safety advocates have fewer lobbyists.

--Money spent now, on non-development rights, for example, will be cheaper than money spent later on reconstruction or remediation.

And the most important of all:

--It’s the constant movement of silt down the river that makes it possible for there to be a Louisiana-and America’s history of “taming” the Mississippi has nearly brought that process to a stop. The River carried 400 million tons a year of silt 150 years ago, Houck reports, and today carries only 80 million. Without that “new” land to deposit in the Delta, there is no way to offset the erosion to the Gulf of Mexico.

That’s not the only reason the State is sinking, however. Pumping drinking water from aquifers has an impact, and the expansion of the ocean caused by global warming does, too. Even the weight of the levees themselves on the soft soil is affecting the situation.

Professor Houck, being a “fix-it” kind of analyst, has offered a ten-point prescription for Louisiana recovery. Here’s the “Reader’s Digest Condensed Version”:

1) Draw the map-in other words, there needs to be a set of decisions made regarding exactly where humans will be allowed to control the land, and where the river will have its say.
2) With a new map, reconsider the projects-Houck reminds us that Katrina changed everything, and that projects already designed or underway are probably the wrong solutions to today’s problems.
3) “Free the Mississippi 400 million”-open dams upriver to allow the 400 million tons of silt to do its thing downriver.
4) Free the rivers-the logical extension of point 3. Open the levees appropriately, and let the rivers do their thing.
5) Cut the upstream fertilizers-we discussed this above-fertilizer kills grass, and that kills land. This is where parties outside Louisiana have to step up to the plate-the EPA, the Corps of Engineers, the various States, and maybe even private actors such as the Nature Conservancy.
6) Heal the marsh-if grass holds the mud in place, then grass we must grow. Professor Houck uses a farming analogy-one in which Louisianans would essentially become “land farmers”.
7) Quit making it worse-dredging and filling for canals and subdivisions is the enemy. As we said above, prevention is cheaper than mitigation.
8) Make room for Nature-consolidate human development within protected areas to create room for natural restoration to work.
9) Dare to think retreat-Houck advocates completely removing residential development from threatened areas, through buyouts. He makes the argument that businesses can be sustained, however.
10) Global warming is real-Professor Houck suggests denial here just makes the problem much, much worse.

We have already seen the consequences of our desire to develop every inch of shoreline, and not just in Louisiana, but all along the Gulf Coast. And we already are beginning to understand that this is truly a national problem.

But if we hope to keep South Louisiana as a functioning economy or even as an above water piece of real estate, we better start talking about national solutions that help Nature’s solutions.

Sunday, June 13, 2010

On Setting Things Straight, Or, An Open Letter To The United Kingdom

Dear The United Kingdom,

I just wanted to take a minute to say hello and to see how things have been for you lately, and to maybe bring you up to date on a bit of news from here.

Well, right off the bat, we hear you have a new Conservative Prime Minister and that his Party and Nick Clegg and the Lib Dems are in partnership, which I’m sure will be interesting; you probably heard that us Colonials are again having Tea Parties, which has also been very interesting.

I have a Godson who’s getting married this September, so we’re all talking about that, and I hear Graham Norton was even better than last year at hosting Eurovision, despite the fact that it’s…frankly, it’s Eurovision.

Oh, yeah…we also had a bit of an oil spill recently that you may have heard about—and hoo, boy; you should see how the Company that spilled the oil has been acting.

So before we go any farther I figured I’d let you know that we did get that letter from John Napier over the weekend, and to tell you the truth, we’re not really sure John understands exactly what’s going on over here.

Now it turns out that it was some company called BP that’s been out there in the Gulf of Mexico operating the oil rig that blew up, killing eleven people and leading to that uncontrollable geyser of oil that you may be hearing about, and our dear Mr. Napier worries that when we say we’re angry with BP, we’re being anti-British.

If anyone should see John, would you please let him know that nothing could be further from the truth?

I promise you, you would be hard pressed to find one single solitary American getting up this morning, seeing the live feed from the oil leak on TV, and thinking: “That BP is scandalously representing Britain, and for that I hate the British”.

I’ll tell what we are thinking, though, is that as bad as this situation is, BP’s been making it a lot worse by, time after time, being either amazingly unaware of or brazenly dishonest about what’s been going on.

Remember back in May when BP said they were capturing 5000 barrels of oil a day with their new containment procedure—while still claiming on the very same day that the total amount of the leak was 5000 barrels a day, even though anyone who could look at the image from the leak could clearly see with their own two eyes that what BP was saying could not possibly be correct?

I don’t know how far the word’s gotten out over there yet, but now even the Daily Mail (not the “Guardian”, for God’s sakes… but the “Daily Mail”) says it looks like BP guessed low on the amount that’s leaking into the Gulf by somewhere between 15,000 and 35,000 barrels a day…which, to us, looks like either incredibly bad guessing or an incredibly bad effort to deny how bad things really are.

You’ll love this, United Kingdom: BP continues to insist that there are no underwater “plumes” of oil in the Gulf, even though the people on the scene measuring them, and the US Government agency mapping them, say there are.

The BP position, as I understand it, rests on the definition of “plume”…and when you consider that Americans still make fun of Bill Clinton, to this very day, for basing his impeachment defense on what the definition of “is” is, you shouldn’t be too surprised if we treat BP precisely the same way for doing the same thing.

This isn’t the first disaster for BP in this country, either. You may not remember, but just about five years ago BP blew up a refinery in Texas, killing 15 workers, and just afterward had another major spill, this time in Alaska.

The US Government levied an astonishingly large £53 million fine against BP in 2009 for not fixing the problems that led to the 2005 refinery disaster.

That puts the five-year casualty total for BP at way too many people dead, two habitats wounded, and one refinery in critical condition.

If you think that’s bad, United Kingdom, it now looks like BP just made up the spill response plan that they would be putting in place now…if they had been telling the truth about their ability to execute the plan in the first place.

Now if you put all that together…don’t you think somebody’s ass needs to be kicked? Mr. Obama does, and we find that a refreshing change from Mr. Bush, who would have likely done a "heckuva job" himself in the same situation.

Mr. Napier wanted us to know that we’re personalizing this a bit too much; he reminds us that:

“If you compare the damage inflicted on the economies of the western world by polluted securities from the irresponsible, unchecked greed and avarice of leading USA international banks, there has not been the same personalized response in or from countries beyond the US. Perhaps a case of double standards?”

John, babe…if you think we’re lacking in “anger personalization”, perhaps you’ve never actually heard of the Tea Party? I know the "Daily Mail" has, and I’m surprised you missed it.

Perhaps you missed the left-leaning protesters in San Francisco that want to put the CEOs of banks in jail, or the protesters in West Virginia, of all places, or in Boston?

Perhaps you don’t think there’s a reason to take it a bit personally when someone kills a couple of dozen people or so in some sort of preventable accident or another, but over here, whether it’s a mine operator or BP, we do take it personally.

Trust me, there’s no double standard: ask almost any American and they’ll tell you they’d be equally happy to see either a Wall Street or a BP executive forced to spend several years in a really tiny jail cell with someone who has a prior record of doing disturbing things to small forest creatures.

OK, United Kingdom, now here’s a chance for you to do the Company a favor: BP announced just a couple of days ago that they have no earthly idea why their stock price might be going down.

With just the least little effort, we could fix that problem right away.

If any of you might be in London, and don’t mind making a local call for me, would you kindly ring up BP corporate headquarters at +44 (0)20 7496 4000, and when they answer, just let them know that the stock price is going down because of the oil leak and what it’s doing to the perception that BP will be as profitable in the future as they had been in the past?

I’m sure they’d be so appreciative of the assistance that they might even give you a cool BP hat or something just for helping them out—I know I would, if I were BP.

Anyway, I’m hoping this will clear up some of Mr. Napier’s questions, but before I go, I have to ask you about something:

They tell me that BP stock is a huge part of the UK’s investment portfolio; and that lots of pension funds are dependent on the stream of revenue BP dividends represent.

So dependent, in fact, that there is a great hue and cry over the possibility that BP might not be able to pay a dividend to its shareholders.

So here’s what I was wondering: in the US, if a company in which you were invested suffered a loss that might reach beyond £30 billion, it’s supposed to have a negative impact on the stockholders. It’s almost certainly going to affect any potential dividend distribution, and a company like that might find itself taken over by a stronger competitor.

Doesn’t it work that way in the UK?

I’m sorry that those folks got caught in a bad investment, and maybe the UK Government wants to extend some sort of assistance to those affected; nonetheless I can’t understand the legal logic behind the proposition that cleaning up the mess that BP caused and the payment of compensation claims based on BP’s reckless actions should have a lower priority than the distribution of income to stockholders.

To put it as simply as possible: lots of players in the UK markets were happy to accept the profits from this investment, despite the risks, and now it’s time to accept a loss. That’s how investing works; and if no one else has told you that by now, well…welcome to investing.

And while UK pensioners are worried about losing some income, American workers—thousands of them—are worried that they’ll be out of work for months, and maybe years, with no income at all, except for that provided by BP…unless they go broke and can’t pay.

So that’s what’s been going on here since I wrote you last, and I hope you do get a chance to call BP about that whole stock going down thing, so they know, and I hope you don’t think we’re in any way upset with Britain at all, ‘cause we are truly not.

British Petroleum, however, is a different story; and based on the record we feel that our anger is entirely justified…but that would have been just as true if it had been Chevron or Anadarko or any other deepwater driller—just as it was true for Exxon after the Exxon Valdez incident two decades ago.

Anyway, I have to go now, but I’ll try not to wait so long before I write again; and I hope BP is able to contain this stuff before it begins washing up on your beaches, which, believe it or not, is a distinct possibility.

As always, your friend,


Wednesday, June 9, 2010

On Balanced Budgets, Or, Hey, Rand, Why Not Show Your Cards Now?

Those who are regular visitors to this space know that I post stories across the country, and to do that I have to follow stories from a number of states.

Because I post at Kentucky’s Hillbilly Report, I’ve been paying particular attention to the Rand Paul campaign, and the news from the Bluegrass State (via “The Rush Limbaugh Show”) is that Paul’s planning to write his own balanced budget proposal for the Federal Government.

But there’s a catch.

He doesn’t plan on doing it until after the election.

Well, now, why in the world would a guy who’s running for office based on his really good ideas want to hold back the best one?

That’s not a bad question, and if we make the effort we can probably figure out the most likely answers.

“I cou’d be mighty foolish, and fancy my self mighty witty; Reason still keeps its throne, but it nods a little, that’s all.”

--George Farquhar, The Recruiting Officer

First things first: we’re having this conversation thanks to the Hillbilly Report story from RDemocrat that I mentioned above, and from the original source, a posting from Bluegrass Politics (“Covering Kentucky politics and government”). So…thanks, y’all.

Now let’s get to the business at hand:

Why wouldn’t Paul want to reveal his balanced budget proposal now?

--It’s possible that Paul does not have a proposal ready to go.

If that were true, it could be because right now he only has a “sort-of outline” as to how he would get there.

If that’s the case, that’s OK; just go ahead, Dr. Paul, and tell us what you have in mind so far, and we’ll start to work the numbers and begin to see if it makes sense.

It’s also possible that he made a promise to deliver this balanced budget proposal with little or no idea as to how he would actually make it work.

That’s not OK, Dr. Paul—and I’m guessing that Kentucky voters wouldn’t think it’s OK either.

--It’s possible Paul has a proposal ready to go, but the details of that proposal are not going to fly with Kentucky voters.

As we discussed in another recent conversation, you aren’t going to get to a balanced Federal budget without drastically cutting spending, drastically raising revenues, or both, especially if you want to do it immediately; it may be just too much of a political “lift” for Paul to explain exactly how he would actually do that—at least until after Election Day.

In this political environment, a candidate does not want to get caught being untrue to their “brand”, or afraid of their own ideas; it would be very much to Paul’s disadvantage if this turned out to be the correct explanation for what’s going on and Kentucky voters became aware of the situation.

And with all that in mind, here’s the thing:

I’m not trying to play “gotcha” journalism here, Dr. Paul, and I hope you don’t think I am—but it is a fact that you’re basing your entire campaign on the power of your new ideas, and that means I have to ask you why you’re not willing to explain exactly what you think a balanced budget would look like until after the election?

Imagine if I came into your clinic, and you told me you knew that the frames you were showing me would look great, and fit even better, and the lenses will make me see like an eagle—and after I’ve paid for them, and you’ve finished making them, then I can try them on?

You wouldn’t sell me a pair of glasses that way, Dr. Paul, would you?

Of course you wouldn’t…so why are you asking people to vote first, and try you on later?

It doesn’t make any sense, if you have good ideas ready to bring to the table—but it would make sense if you’re doing a “bob and weave” because you don’t want the voters to see that you either have ideas they won’t like, or no ideas at all.

You don’t want voters thinking that about you, so why don’t you clear things up and let people know, today, that you know what you’re talking about…before they begin to think maybe you don’t.

Monday, June 7, 2010

On Canadian Cultural Imperialism, Or, I Explain Red Green

We are again having to take a short bypass on our planned writing journey; this time to a place that’s, according to their Facebook page, about 148 beer stores north of Toronto, Ontario (which, for the benefit of the less-geographically aware reader, is in Canada).

It’s a crazy place, where duct tape is more truly the coin of the realm than loonies, but we’re going to try to explain it all today…and in the effort we may even learn about a few things that really matter, like the unimportance of importance, and the kind of quality of life that comes from having a junk pile and a sense of adventure.

So grab the bug spray, Gentle Reader, because it’s time to visit Possum Lodge.

“You want to make it two inches -- or, if you're working in centimeters, make sure it's enough centimeters for two inches.”

--Red Green

Possum Lodge itself is in the remote north of Canada (right next to Possum Lake), but Lodge members live all over the place.

So how do you spot a Lodge member?

You’ll often find them out in the shed, sorting through the pile of junk, looking for a part…but you might find them at the auction, looking to buy a used police car, or out on the lake, fishing.

Lodge members typically have been with the spouse for long enough that passion has been replaced by realpolitik; that’s certainly true of Dalton Humphrey and his wife Anne-Marie (Dalton owns the “Everything Store”, by the way, and since it’s the only store this side of Port Asbestos, the prices are way too high).

A great way to understand the friendly cynicism of a Lodge member is to check out the Possum Lodge Word Game. In this episode, Red’s geeky nephew Harold is the timekeeper, and Edgar Montrose, the “local explosives expert”, is trying to say a certain word…

When today’s Lodge members were kids, they were the ones who would take things apart, just out of curiosity—and a true Lodge member won’t be able to put the thing back together exactly how it came apart…but that’s why they make what Red calls “the handyman’s secret weapon”, duct tape.

Today, jury-rigging things together in an effort to make something new isn’t just a matter of curiosity…it’s a lifestyle. Check out this example of Red rigging two cars together to make one all-wheel-drive car:

This next video is even better: you get to meet Winston Rothschild (he of the most necessary Rothschild’s Sewer and Septic Sucking Services), and you get to learn how to build a self-operated dog wash at the same time…which, in real life, almost never happens.

“Buzz” Sherwood is the local bush pilot—and the “Buzz” in his name does not refer to how low he flies. Matter of fact, with Buzz also being the local hippie and all, the nickname really refers to how high he flies, if you get my drift.

For these guys, camping can be…it’s…tell you what…just watch this:

Now if this was all there was to our little tale, it would be OK, but this has actually been the set-up for what Paul Harvey would have called “the rest…of the story”.

“I’m a man, but I can change, if I have to…I guess.”

--The Red Green Show’s “Man’s Prayer”

You see, I met Red Green about two weeks ago (to be more accurate, I met Steve Smith, who is one of the two co-creators of the Possum Lodge franchise, in his Red Green character), up at the ol’ True Value in West Seattle, and we had a most interesting conversation…and it won’t be at all what you think we might have talked about—sorry, aboot.

You see, I was recently notified by email that I’m gay, and the night before I was actually attending a meetup with some of my gay friends, and as it turned out, they, being a bit more the “dazzling urbanite” type than myself, had no idea who Red Green really was.

Right that minute, I figured I would put a story together that tried to explain Possum Lodge, not just to the gay community, but to anybody who doesn’t fully understand how a bit of indolence can be a beautiful thing.

And (with apologies in advance for the lack of sound) that’s what we’re talking about in this next video, where Red is preparing to autograph my roll of clear duct tape (and yes, Virginia, there is such a thing as clear duct tape):

So as you can see, we’re talking about all this, me and Red there, by the duct tape display, and he sorta leans over conspiratorially and tells me that he actually has a pretty substantial gay audience—and that in fact, Possum Lodge is the kind of place where nobody would really care if you were gay, and, as far as anyone can tell, a few of the members may very well be gay.

And that made a lot of sense to me, actually, because The Girlfriend and I play mini-golf with a woman who drives a pickup truck that’s just about the same age and size as Red’s “Possum Van”, and she’s constantly workin’ on stuff, which means when you go over to the house it’s often like attending a live segment of “Handyman’s Corner”…and to tell you the truth, she has that kind of not-in-a-particular-hurry personality that would probably fit right in at the Lodge…and, as it turns out, she’s gay.

So how about that for a bit of a story: an introduction to a way of life you may have observed from a distance but never understood, a chance to have a few laughs on Red, and—most surprising of all—a chance to discover that, even 148 beer stores north of Toronto, there’s a place for all kinds of folks to come together and do just about as little as possible for as long as they can get away with it…or at least until the wife finds out.

And if you ask me, that’s a pretty good message for the start of summer.

Saturday, June 5, 2010

On Responding To Oil, Or, “Disaster, Or Emergency, Or Neither?”

We’re now into day way too many of the BP oil spill, and the President has just yesterday been down on the Louisiana coast—again.

There have been suggestions that the Administration should take action to essentially push BP out of the way and take over the work itself, particularly as it relates to the cleanup.

It may have even occurred to you that an official declaration of some sort might be needed, in order to bring the full power of the Feds into play.

That’s some good thinking, but before we go jumping right into declaring things we better understand the law, because if we don’t, we could actually make things worse.

It was a deathbed scene, but the director was not satisfied with the hero’s acting.

“Come on”, he cried, “Put more life in your dying!”

--From 10,000 Jokes, Toasts, & Stories, Lewis and Faye Copeland, Editors

So right off the bat, we need to give credit to Francis X. McCarthy of the Congressional Research Service, who put together Potential Stafford Act Declarations for the Gulf Coast Oil Spill: Issues for Congress, which will, unless indicated otherwise, be our source for today’s discussion, and the most excellent Steven Aftergood, who, among his other good works, sends me those Secrecy News emails that should be coming to every one of your inboxes as well.

And with that said, let’s get to work:

In a situation such as the oil spill, the Stafford Act, which is the law governing emergency and disaster responses, gives the President a fairly limited number of options: he can do nothing, leaving BP as the lead party in the response, or he can declare, on his own initiative, that an “emergency” exists. He can also agree to respond if the Governor of a State declares that an emergency or “major disaster” has occurred within that State.

So which means what?

From the Stafford Act itself (42 USC 5122):

“(1) Emergency.— “Emergency” means any occasion or instance for which, in the determination of the President, Federal assistance is needed to supplement State and local efforts and capabilities to save lives and to protect property and public health and safety, or to lessen or avert the threat of a catastrophe in any part of the United States.

(2) Major disaster.— “Major disaster” means any natural catastrophe (including any hurricane, tornado, storm, high water, winddriven water, tidal wave, tsunami, earthquake, volcanic eruption, landslide, mudslide, snowstorm, or drought), or, regardless of cause, any fire, flood, or explosion, in any part of the United States, which in the determination of the President causes damage of sufficient severity and magnitude to warrant major disaster assistance under this chapter to supplement the efforts and available resources of States, local governments, and disaster relief organizations in alleviating the damage, loss, hardship, or suffering caused thereby.”

It’s not just terminology, either…there are functional differences as well.

The biggest: if the President declares an emergency, on his own initiative, FEMA will not be permitted to offer Disaster Unemployment Assistance, which is a program that does just what you think it does for people like South Louisiana’s fishers and tourism workers. If the Governor declares a disaster, on the other hand, such assistance would become available.

Other “disaster-only” assistance would include paying for “emergency protective measures”; this means that FEMA, and not the State, would bear some of the cost of building the proposed “barrier islands” that might keep some of the oil off the coast.

For most emergency and disaster assistance the Federal “cost share” is 75%; it can be modified up to 100% if the President so declares.

So far, so good…but there is another side to this story.

In the aftermath of the Exxon Valdez incident the then-Governor of Alaska, Steve Cowper, tried, twice, to get George Bush the First to declare a disaster. He was unwilling to do so.

The reasoning behind this was that…well, how about if I just let you hear the story firsthand:

“The Department of Justice opposed a declaration of disaster by then-President George H. W. Bush on the basis that it might impact adversely the case of the United States against Exxon. When asked at a Senate Appropriations Committee hearing by Senator Ted Stevens (R-Alaska) why no declaration of disaster had occurred, the then-Acting General Counsel of FEMA, George Watson, said on the record that he had issued a legal opinion stating that no declaration of an oil spill could be made under the Stafford Act.

When Sen. Stevens asked for a copy of the opinion, Mr. Watson said he would furnish one. Instead of an opinion, a somewhat garbled statement was given by FEMA’s congressional liaison for insertion in the record. The statement basically concluded that where a parallel statutory scheme offered both compensation and better litigation rights to the United States than the Stafford Act, then the president would not declare a disaster or emergency.”

The money for these responses comes from the Disaster Relief Fund. This Fund is not part of the annual Federal Budget appropriations process; instead, it’s refilled, as the need arises, by supplemental appropriations.

The Fund is almost empty at the moment, and even before this event it was predicted that the money could run out by this month. (It’s estimated that the Fund is spending about $350 million a month to mitigate the various disasters currently on the books, with only about $600 million in the Fund as of May.)

A supplemental appropriations bill, part of which would provide $5.1 billion for the Fund, to cover past and future expenses, is before Congress right now (H.R. 4899).

The Senate wants its version of the bill adopted (it’s not just a FEMA bill: there’s lots of juicy defense appropriations in there as well, among other allocations), and they’ve asked for a House/Senate conference. Almost a third of the Senate is on the Conference Committee, so you know there are a lot of negotiations ahead—unless, suddenly, a new sense of urgency is felt by all parties involved.

(Fun Fact: There was a large cleanup of spilled oil associated with Katrina, to the tune of about 9 million gallons.)

We need to stop, for just a moment, and talk about two other potential sources of cleanup funding out there: the Oil Spill Liability Trust Fund (OSLTF), and, possibly, the EPA’s Superfund.

If BP should turn out to be unwilling to pay the billings being submitted by the US Government for cleanup and other expenses, or if the Company denies claims from third parties that the Feds think should be paid, then the Trust Fund is available to pay claims while collection actions against BP are underway.

However…the Fund can only pay claims associated with oil pollution. Claims related to pollution caused by other hazardous materials…like dispersant…cannot be paid by this Fund.

The normal solution would be to charge those expenses to the Superfund, but there’s a “however” attached to that. Long story short, the Superfund cannot pay for claims related to pollution in bodies of water.

There’s more: the OSLTF is limited, by law, to $1 billion, maximum, per incident, with only $500 million of that available for the natural resources cleanup associated with that incident.

(Fun Fact Number Two: There is such a thing as microwaveable haggis.)

At about this point, you’re probably thinking that we should declare something pretty much right away.

Not so fast there, Gentle Reader…because here’s the “you could make things worse” part:

If the Stafford Act is invoked, and an emergency or disaster is declared:

“Any person who intentionally causes a condition for which Federal assistance is provided under this Act or under any other Federal law as a result of a declaration of a major disaster or emergency under this Act shall be liable to the United States for the reasonable costs incurred by the United States in responding to such disaster or emergency to the extent that such costs are attributable to the intentional act or omission of such person which caused such condition.”

And therein lies the trouble.

If BP can successfully argue that they did not intentionally spill that oil, then the ability to recover money spent cleaning it up would be severely limited, if not entirely lost.

So as of this morning, that’s where we’re at: there’s a belief that BP is not doing all it can to fix this, or to clean it up, and that one way to get around that problem would be for the Federal Government to invoke emergency powers and take over the cleanup itself.

The Oil Pollution Act of 1990 provides some capability in this area, through the Disaster Relief Fund, but the money available for the task is limited, and probably insufficient for the work that needs to be done.

And while the Stafford Act provides additional authorities of its own, there is a real possibility that invoking the Act will let BP off the hook for the giant legal liability that appears to be facing them down today.

It’s a really tough situation for a national leader, and if you ever wondered why Barack Obama’s hair seems a bit grayer lately…well, this might be part of the reason why.