Relevant and even prescient commentary on news, politics and the economy.

The White House Finally Takes an Actual STAND on Something That Was Not Dictated by Tim Geithner or the National Security Brotherhood. And It’s the Ethical Position in the Controversy, to Boot!

 

This isn’t trivial. One of the sweetest dogs I’ve ever met was a waggly-tailed white pit bull that a neighbor of a friend of mine found roaming the street. As soon as the sweetie saw you approaching, she’d wag her tail excitedly and then lie down on her back to invite you to rub her belly.

These dog-breed-ban statutes are abominable.  Now, a Tim-Geithner -White-House-ban statute would be another thing entirely. Maybe when Congress returns after Labor Day?

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Les Misérables

Via Alternet comes this quote from Victor Hugo in Les Miserables:

Victor Hugo described this war with the poor in Les Misérables as one between the “egoists” and the “outcasts.” The egoists, Hugo wrote, had “the bemusement of prosperity, which blunts the sense, the fear of suffering which is some cases goes so far as to hate all sufferers, and unshakable complacency, the ego so inflated that is stifles the soul.” The outcasts, whose persecution and deprivation was ignored until it morphed into violence, had “greed and envy, resentment at the happiness of others, the turmoil of the human element in search of personal fulfillment, hearts filled with fog, misery, needs, and fatalism, and simple, impure ignorance.”

 

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“Chicago issues RFP for more charter schools”

As my Chicago friend Mike (doodahman) points out in Facebook, the City has just issued RFPs for additional Charter Schools. This comes after Chicago Public Schools closed 50 schools throughout the city causing students to travel farther and over crowding other schools. The Chicago Teachers Union sees it as a union busting tactic and predicted it as such as Charter School teachers can not be represented by the union (CTU).

“Without fanfare, the district posted an official ‘request for proposals’ to its website Monday that invites charter schools to apply to open shop in what the school district has identified as priority neighborhoods—large swaths of the Southwest and Northwest sides.

Those heavily Latino areas have struggled with overcrowded schools.

The district wants what it’s calling ‘next generation’ charter schools, which could combine online and traditional teaching. It also wants proposals for arts integration charter schools and dual language charters.

Chicago is coming off a painful process to close 50 schools it said were underutilized; the district last December determined that half its schools are underenrolled. District spokeswoman Becky Carroll said Tuesday in an email that “while there were significant population declines in some parts of the city, there were also increases in other parts of the city…. There are many schools that are overcrowded or are facing overcrowding and we need to address that issue as we do any other.”

The Chicago Teachers Union and others have argued for years that school closures are about making way for charters and weakening the union.

‘We are not surprised at all by this,” said union president Karen Lewis . “We were called conspiracy theorists, and then here is the absolute proof of what the intentions are…. The district has clearly made a decision that they want to push privatization of our public schools.’

The district has been slowly shifting students to charter schools, which are publicly funded but privately run. Around 13 percent of district students—and more than 20 percent of the district’s high school students— are educated in charter schools. Teachers at charters cannot be represented by the Chicago Teachers Union.”

As one reader pointed out in the above article, the Chicago Commercial Club (ComCC) is behind much of the change going on in the Chicago Public School system. The ComCC membership consists of many of the well to do with in the City

“The blatant self-serving intrusion of the ComCC in the city’s education system is highlighted by the fact that its Civic Committee issued a report titled ‘Left Behind’ whose recommendations became the basis for CPS’s draconian Renaissance 2010. The Renaissance 2020 plan called for the closing of 60 to 70 neighborhood schools and for the introduction of up to 70 charter schools. According to DePaul University professor Pauline Lipman ‘Renaissance 2010 opens up the third largest school system in the USA to a market model of school choice, privatization, and elimination of school employee unions and elected local school councils.

The ComCC membership consists of many of the well to do from the City who exercise their influence and power regardless of who is in office. The implications of which cause one to wonder what it means for the city and schools with all of this corporate power and influence used to shape both. The bottom line is still to enhance their profits at the expense of the people they claim to be attracting.

Rahm I. Emanuel, Mayor, City of Chicago; William M. Daley, Chief of Staff, The White House; Lester Crown, Chairman, Henry Crown and Company [family wealth = $4.8 billion]; Kenneth C. Griffin, Founder and Chief Executive Officer, Citadel, LLC [wealth =$3.7 billion]; Tony W. Hunter, Chief Executive Officer, Tribune Publishing Company Valerie B. Jarrett, Senior Advisor to the President, White House; Paul V. La Schiazza, President – Illinois, AT&T Illinois; Timothy P. Maloney, Illinois President, Bank of America; J. B. Pritzker, Managing Partner, The Pritzker Group [wealth = $1.6 billion]; Penny Pritzker, President and Chief Executive Officer, Pritzker Realty Group, LP [wealth = $1.7 billion]; Thomas J. Pritzker, Chairman, Hyatt Hotels Corporation [wealth = $1.8 billion]; J. Christopher Reyes, Chairman, Reyes Holdings, LLC [wealth = $2 billion]; Michael D. Scimo, Managing Director, Chicago Office, Accenture; William Wrigley, Jr., Chief Executive Officer, Wrigley Management, Inc. [wealth = $2.2 billion], etc.

References:

Just months after closing 50 schools, Chicago issues RFP

The Biggest Shark in the Reinvention Pond: The Commercial Club of Chicago

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The Tea Party’s Disruptive Anti-Government (and anti-tax) Politics

by Linda Beale

The Tea Party’s Disruptive Anti-Government (and anti-tax) Politics

The New York Times ran an interesting piece by Kim Messick on the Tea Party’s psyche yesterday: Messick, The Tea Party’s Paranoid Aesthetic, New York Times (Aug. 10, 2013).  It’s worth trying to understand this political group’s understanding of itself, since it ” is a political movement … that tries to shape the decisions of political actors — voters,legislators, pundits — into maximum coherence with its own agenda.”  Id.  Its agenda is much influenced by the corporate funding that supports it but there is clearly something that holds the group together.  Messick says that they so identify their own ideas and values with the country that they see any divergence from those values and ideas as literally “unAmerican” and any evidence that the country supports things they do not support as evidence of a vast conspiracy causing the undoing of the true America.

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Fuel Spill: The Republicans Are About to Admit That Obamacare Helps Consumers. (Bet On It.)

In another setback for President Obama’s health care initiative, the administration has delayed until 2015 a significant consumer protection in the law that limits how much people may have to spend on their own health care.

The limit on out-of-pocket costs, including deductibles and co-payments, was not supposed to exceed $6,350 for an individual and $12,700 for a family. But under a little-noticed ruling, federal officials have granted a one-year grace period to some insurers, allowing them to set higher limits, or no limit at all on some costs, in 2014. …

The [change] is likely to fuel continuing Republican efforts this fall to discredit the president’s health care law.

Under the policy, many group health plans will be able to maintain separate out-of-pocket limits for benefits in 2014. As a result, a consumer may be required to pay $6,350 for doctors’ services and hospital care, and an additional $6,350 for prescription drugs under a plan administered by a pharmacy benefit manager.

Some consumers may have to pay even more, as some group health plans will not be required to impose any limit on a patient’s out-of-pocket costs for drugs next year. If a drug plan does not currently have a limit on out-of-pocket costs, it will not have to impose one for 2014, federal officials said Monday.

A Limit on Consumer Costs Is Delayed in Health Care Law, Robert Pear, New York Times, today

Damn that Obama administration for forcing people whose insurance policies now have no limit on patients’ out-of-pocket costs to force them to wait another year for that consumer protection to kick in!  This is proof positive that we should repeal the statute so that that consumer protection will never kick in!

Freedom! Liberty!

Yep.  Definitely fuel for continuing Republican efforts this fall to discredit the president’s health care law. Can’t wait for the fuel spill.

The legal profession has a term for this in its Rules of Evidence: It’s called a statement against interest. The law of physics has a term for it, too: boomerang.

—-

UPDATE: Ezra Klein posted a good Wonkblog post yesterday explaining what happened, and why. 8/14

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Fast-Food Fight….reader Denis offers some pointers

Reader Denis Drew writes (lifted from comments) :

The bottom 50% of America’s workforce now takes 12% of overall income. If the federal minimum wage is raised to $15/hr that will add 3.6% direct inflation.

$15/hr being today’s median wage, half the workforce, 70 million employees receiving an average $8,000/yr raise would add $560 billion to the cost of $15.8 trillion dollar economic output = only 3.6%.

It is hard to believe that the products and services produced by half of the American workforce (70 million people!) would no longer be in demand over a 3.6% increase in overall prices.

+++++++++++

Reader Denis Drew points us to think about an American institution, food, and wages…maybe much more elastic than we pretend (lifted from comments).  McDo in France via  Slate Magazine shows us some innovation is possible.  Much more after the fold:

It may surprise some, but McDonald’s France—called MacDo by the locals—is the highest-grossing McDonald’s market outside of the United States (despite the fact that worker pay, a recent source of controversy in the United States, starts around $12 an hour—France’s minimum wage) …. If McDonald’s has found success in France, it’s because in many ways it has become the anti-McDonald’s: The service is warm, the interiors thoughtfully designed, and, above all, the food—from the baguette vessels to the pain au chocolat to the camembert-swaddled patties—is made for French palates. (italics are mine)

Before you book a two-top for Friday night, remember that this is still fast-food: The beef, while grass-fed and hormone-free, still comes from an industrial cattle lot, the lettuce still wilts under the glare of a heat lamp, the tomatoes are redolent of, well, nothing in particular. While you’re here, you’re not likely to forget that you’re eating at a multinational chain restaurant, but with enough macaroons and Camembert in your belly, it may just soften your opinion of the golden goliath.

The secret sauce at McDonald’s used to be lockstep consistency, the fact that a meal in Memphis tasted the same as it did in Moscow or Madrid. But the novelty of the American hamburger stand has worn off in the new millennium, and with it McDonald’s ability to export American culture as its staple commodity. A cheeseburger, fries, and Coke don’t register the same level of excitement when the café next door and the bistro down the block are also serving burgers. More and more, the key to McDonald’s future appears to be found in the DNA of the places it inhabits. And with it, suddenly the fast-food giant that to many represents the globalization of taste suddenly finds itself in a very unlikely position: as a defender of local cuisine.

And also from the THE EDITORIAL BOARD New York Times yesterday:

Fast Food Fight

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Part Time Employment and the Sequester

Part of the reason employment and hours worked, in particular, have been so weak in early 2013 is the rapid growth of part-time employment. Part time employment is volatile and subject to many influences.  From December to June part time employment rose 589,000.  That is a 2.2% — almost 5% annualized – growth rate. Part time employment jumped from 18.4 % of total employment in December  to 19.0% in July.

The unusually large increase in part time employment is due  almost exclusively to the sequester.  For example, at the Department of Defense (DOD) some 650,000 civilians must take 11 days off in the second and third quarters. They have 26 weeks, but after adjusting for federal holidays, vacations, sick leave, etc., the effective  time is 22 weeks. This works out that DOD employees must take an involuntary, unpaid day-off every other week. Consequently, on any given week about half of the DOD civilian workers (325,000) became part time employees.  That is 55% of the 589,000 jump in part time employment in the first half of 2013..

But the sequester is impacting all federal employees and is spreading to federal contractors.  Total federal civilian employment is 2,760,000.  If half are now part time workers that would be 1,380,000, or 134% of the 589,000 jump in part time employment. Even if only 25% of non-DOD federal civilian workers are now part time, it would still mean that the sequester is converting over a million jobs into part-time work.

 

 

 

 

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"pensioners: 17 cents on the $; BoA, UBS 75 cents on the $"

Detroit Said to Reduce Swaps Debt by 25% in Deal With Banks . The swaps were a “bet” on the direction of interest rates. With the decline of variable interest rates, Detroit found itself owing to the banks. With the decreased credit rating to B2, the same as AIG, Detroit found itself at the mercy of the banks who demanded their money. Except, there was no President of Congress moving quickly with legislation to establish a fund like TARP did for AIG. Nor did the Fed establish the city as a Bank or buy up its municipals. Even the state of Michigan did little to help the cash strapped city.  When the first Michigan Emergency Manager Act was struck down, the Republican dominated legislature reacted quickly, far quicker than voting on the expansion of Medicaid (one year has passed since SCOTUS ruled on the PPACA); but then, this is TBTF and business we are talking about and not ~ 450,000 constituents living with incomes less than FPL. With little delay, the legislature passed a new Emergency Manager Act, Public Act 436 giving derivatives such as the Interest Rate Swaps top priority similar to what the Federal 2005 Financial Services Modernization Act did. Public Act 436 goes as far as to supersede payments to pensioners and child support payments.

Sec. 11. (1) An emergency manager shall develop and may amend a written financial and operating plan for the local government. The plan shall have the objectives of assuring that the local government is able to provide or cause to be provided governmental services essential to the public health, safety, and welfare and assuring the fiscal accountability of the local government. The financial and operating plan shall provide for all of the following:

(a) Conducting all aspects of the operations of the local government within the resources available according to the emergency manager’s revenue estimate.

(b) The payment in full of the scheduled debt service requirements on all bonds, notes, and municipal securities of the local government, contract obligations in anticipation of which bonds, notes, and municipal securities are issued, and all other uncontested legal obligations. [ As written by a Republican legislature and signed into law by a moderate Republican, Governor Rick Snyder]

Besides awarding derivative holders and bank first in line status, the Republican State Legislature also took it upon themselves to make sure Public Act 436 can not be overturned through voter referendum. Governor Rick Snyder wasted no time in signing the bill.

The winners in the Detroit crisis are the banks who have reaped $millions in fees, avoided property taxes on partially foreclosed properties (the foreclosures were never completed after driving the owners out of the houses and left the uninformed former mortgage holders on the hook for back taxes), and moved to the front of the line of Detroit debt holders. Typically these Interest Rate swaps are of the variable interest rate variety and are often exchanged for fixed rate through the Swaps. When the Fed drove down the variable interest rates, cities found themselves on the hook for the higher fixed rates. Many of the Swaps are also tied to the London Interbank Offered Rate (LIBOR) which was being manipulated by the largest banks. As a result, the banks owe little due to low variable rates and the cities are on the hook for higher fixed rate costs. Just a measly $1.4 billion of the $3.8 billion Interest Swaps tied to Detroit Pension Funds to which pensioners are being asked to accept far less than what banks are being asked to accept.

The losers?  Retirees who have pensions covered by the Interest Swaps. Workers who took and will take wage cuts. Detroit with thousands of partially foreclosed vacant houses which property taxes can not be collected on from the former owners or the banks. The state of Michigan; it will have a black eye for doing little to help the abandoned city over the decades. Without it and its trade with the US largest trading partner Canada, the state would be little more than a large vegetable farm. Banks may take a trim around the ears; but, it will not be anywhere as severe as the haircut the pensioners and workers will have taken when all is sorted out.

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State Run and Free Healthcare Clinics ? ? ?

“For goodness sakes, of course the employees and the retirees like it, it’s free,” says Republican State Sen. Dave Lewis.

11,000 Helena state employees, retirees, and dependents now go to a state run healthcare clinic which is free. No co-pays, no deductibles, doctors are salaried, wait time is a few minutes, and visits are up 75%. Of course, the skepticism is high:

“I thought it was just the goofiest idea”

“If they’re taking money out of the hospital’s pocket, the hospital’s raising the price on other things to offset that,” Lewis suggests . . .

He (Lewis) and others faulted then-Gov. Brian Schweitzer for moving ahead with the clinic last year without approval of the state legislature, although it was not needed.

One year has passed and what about today’s feelings ?

“They’re wonderful people, they do a great job, but as a legislator, I wonder how in the heck we can pay for it very long,” Lewis says. (me)Someone changed his mind.

– division manager Russ Hill says it’s actually costing the state $1,500,000 less for healthcare than before the clinic opened. (me) Sounds like it will fund itself in the end.

“Because there’s no markup, our cost per visit is lower than in a private fee-for-service environment,” Hill says.

Some of this may not sit well with physicians; but, why the big difference ? ? ?

Physicians are paid by the hour, not by the number of procedures they prescribe like many in the private sector. The state is able to buy supplies at lower prices.

Bottom line: a patient’s visit to the employee health clinic costs the state about half what it would cost if that patient went to a private doctor. And because it’s free to patients, hundreds of people have come in who had not seen a doctor for at least two years.

Hill says the facility is catching a lot, including 600 people who have diabetes, 1,300 people with high cholesterol, 1,600 people with high blood pressure and 2,600 patients diagnosed as obese. Treating these conditions early could avoid heart attacks, amputations, or other expensive hospital visits down the line, saving the state more money. and lower costs over all in the end (me).

– That personal attention has proved valuable for library technician Pamela Weitz. A mammogram late last year found a lump. “That doctor called me like three or four times, and I had like three letters from the clinic reminding me, ‘You can’t let this go, you’ve got to follow up on it,’ ” she says.

This is what is meant by improved quality and better outcomes from healthcare as opposed to a services for fees scenario.The patients appear to be happier as well as the doctors employed by the state run clinic.

– Clinic operations director and physician’s assistant Jimmie Barnwell says this model feels more rewarding to him. “Having those barriers of time and money taken out of the way are a big part [of what gets] people to come into the clinic. But then, when they come into the clinic, they get a lot of face time with the nurses and the doctors,” Barnwell says

Maybe it is a fluke; but at least, one state tried it with what appears to be good results. I live in Michigan where the state Repubs have been haggling with the teacher and state employee’s unions over paying for healthcare insurance. I could see this model working here for both groups as well as Detroit workers and retirees where the city is seeking to end it for retirees and cut it for workers. In the end, it appears it could save Michigan and Detroit money which is sorely needed in “some” cases. It is interesting a state which is 50-50 in politics appears to have found a way out of the healthcare cost and insurance quagmire. Montana’s State-Run Free Clinic Sees Early Success

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