games

Dennis Santiago: FDIC Shutters Banks in Illinois and Indiana

by Dennis Santiago on February 11, 2012

Huffington Post…

On Friday, February 10, 2012 the FDIC shifted bank closure activity from the South to the center of the country this week failing Charter National Bank and Trust in Hoffman Estates, Illinois and SCB Bank of Shelbyville, Indiana. SCB at $200B assets was the larger of the two and began to hemorrhage significantly in the 2nd quarter of 2011. It will reopen as part of First Merchants Bank, National Association on Monday. Charter National Bank and Trust was down to $98M in assets as of 3Q2011 and had been living with elevated stress indications from Institutional Risk Analytics (IRA) since March of 2009. Like SCB, Charter also experienced an increase in operating loss rates beginning around the 1st to 2nd quarter of 2011. Charter will reopen as part of Barrington Bank & Trust Company, National Association on Monday. Complete forensic reports can be found here, Charter National Bank and Trust – Hoffman Estates, IL SCB Bank – Shelbyville, IN

View original post here:
Dennis Santiago: FDIC Shutters Banks in Illinois and Indiana

Find our Weekly Commercial Real Estate, Private Equity and Fund Newsletters at www.WeeklyBrief.net

Tagged as: , , , , , , ,

{ 0 comments }

Daniel Wagner: China-Bashing Is a Tiresome Sport in American Politics

by Daniel Wagner on February 11, 2012

Huffington Post…

China bashing has become as much a part of the modern American political tradition as criticizing foreign producers of oil, yet it seems few have actually stopped to think about whether it is justified. The American electorate has become accustomed to the predictable torrent of anti-Chinese rhetoric from politicians of a variety of political persuasions — in large part because of a subtle and uncomfortable recognition that China is beating the U.S. at its own game; Some would even say the Chinese are better capitalists than Americans will ever be. Indeed, China has made remarkable economic progress over the past twenty years — in large part because of its embrace of ‘socialism with Chinese characteristics’ — otherwise known elsewhere as capitalism. A decade ago, American politicians bashed China largely for political reasons. Today, it is for primarily economic reasons. With China having become the second largest economy in the world last year, and poised to overtake the U.S. in economic size in the next decade, it is no wonder American politicians are on the offensive. It should be no surprise that Americans may bristle at the notion that capitalism has helped China slowly dominate the global economy. China is, of course, not above criticism, just like any other country, and American politicians do raise some valid points in criticizing China. For example, the Chinese yuan is undoubtedly overvalued, given that it does not freely float in the foreign exchange markets. And the Chinese government does control large parts of the Chinese economy through state-owned enterprises, which distorts the domestic market and gives some Chinese companies unfair competitive advantages. But China must compete in the global marketplace like any other country and it pays a price for supporting companies that should otherwise fail as a result of being poorly run, inefficient, and bloated. If the U.S. does not like the way China does business, it is free to do business somewhere else. What goes left unsaid, however, is that China has become too important for the U.S. do that, and what U.S. politicians fail to acknowledge is that the U.S. is becoming increasingly irrelevant to the economies of Asia, while China has become the cornerstone of Asia’s fantastic economic growth. China’s trade with the ASEAN countries jumped six-fold between 2000 and 2009, to US$193 billion, surpassing that of the U.S. China’s share of Southeast Asia’s total commerce for the period increased to 11.3 percent from 4 percent, whereas the U.S.’s share of trade with the bloc fell to 10.6 percent from 15 percent. Another thing that gets left unsaid is how important China has become as a destination of U.S. exports. According to the U.S. Treasury’s own report, “in the second half of 2009, U.S. exports to China increased by 15 percent on a year-over-year basis, while U.S. exports to the rest of the world fell by 13 percent. In the first quarter of 2010, U.S. goods exports to China rose by more than 40 percent compared to the same period the year before, while U.S. exports to the rest of the world rose by less than 20 percent.” China’s rapidly growing middle class is the single most important factor for the success of President Obama’s Nation Export initiative. The U.S. not only needs to tap China’s vast foreign currency reserves ( in excess of $3 trillion — more than 10 times that of the U.S.) in order to finance its trade deficit and fiscal deficit, it also needs access to China’s vast market in order to sustain its economic recovery and create much needed jobs for American workers. When was the last time you heard a U.S. politician admit that? Of course, both countries have legitimate criticisms of the other, but they know they need each other, and neither country is going to disappear. So instead of following predictable (and boring) scripts, why not turn the page on Cold War-esque rhetoric and find ways to join hands with China so as to mutually benefit from each other’s comparative advantages? The fact is, China needs and wants the U.S. to succeed economically — as the largest holder of U.S. Treasury Bills — and the U.S. should want China to succeed, so that it has a long-term marketplace for its exports. We are not talking here about some starry-eyed vision of utopia, but rather, a realistic and sensible approach to future bilateral economic relations. Rather than bashing China, U.S. politicians would be well advised to forge a stronger relationship with China. President Obama gets it. Last year he said : “I believe there is much to be gained from a closer working relationship with China. Indeed there are very few global challenges, if any, we can address effectively without China’s active cooperation. They are a global economic power, and engagement with China’s government is an important step in stemming the financial crisis that has devastated economies around the world. Both of our nations seek to lay a foundation for sustainable growth and lasting prosperity. My Administration is also working with China on a number of security issues, including stopping North Korea’s nuclear program, rolling back the advance of extremists in Pakistan, and ending the humanitarian crisis in Dar fur. The United States and China share common interests on a host of issues — including energy security and climate change, food safety and public health, and nuclear non-proliferation and counter-terrorism. We want to work with them to address these issues in the years ahead. Improved relations with China will require candor and open discussion about those issues on which we may disagree. We must address human rights, democracy, and free speech. We must also work to ensure that our nations play by the rules in open and transparent economic competition. These important matters will be essential elements of our ongoing dialogue with China.” The only Republican candidate for president we heard that kind of approach from was John Huntsman, who unfortunately failed to connect with American voters. A sustainable economic recovery in the U.S. cannot be achieved by isolating China. The U.S. and China may seem like the odd couple: the leading proponent of democracy and most individually-oriented nation and the leading communist and most communal-oriented nation. But considering what we can achieve together and what we will lose if we are pitted against each other, forming a Sino-American strategic alliance is critical to the future economic viability of both nations. American politicians, and the American people, would be much better off recognizing this, rather than using demagoguery to sow divisiveness between China and the U.S. The 21st century has no place for tiresome dated Cold War rhetoric. President Obama has the right approach. * Daniel Wagner is CEO of Country Risk Solutions, a cross-border risk consulting firm based in Connecticut (USA), Director of Global Strategy with the PRS Group, and author of the new book Managing Country Risk. Dee Woo is a lecturer in economics at the Beijing Royal School.

Continue reading here:
Daniel Wagner: China-Bashing Is a Tiresome Sport in American Politics

Find our Weekly Commercial Real Estate, Private Equity and Fund Newsletters at www.WeeklyBrief.net

Tagged as: , , , , , , , , , ,

{ 0 comments }

Bill Gunderson: Can a Businessman Run a Country?

February 10, 2012

President Obama sure likes to hold Warren Buffett up as an example these days. After all, it is Warren Buffett that is dying to pay a higher tax rate. Never mind that he is currently fighting the IRS over a paltry billion dollars or so in unpaid taxes. Warren is also hot and bothered about his secretary paying a higher effective tax rate than most millionaires and billionaires. Of course, we still have not seen her tax return, so we really don’t know what rate she does pay. I guess it does not matter however, that Mitt Romney paid several million in taxes while Buffet’s secretary may have paid a few thousand. Who’s counting anyway? My question to you the reader is this: If God forbid, something should happen to Mr. Buffett, would he feel more comfortable hiring Barack Obama or Mitt Romney to take over the management of Berkshire Hathaway? Oh, I know what you are thinking, government cannot be run like a business; it takes politicians to get things done. It is thinking like this that has helped create a current debt load of $15 trillion dollars! Do you think that Mr. Buffett would have gotten us into the mess that we are currently in had he been running the country over the last 10 years? I highly doubt it. Warren still lives in the same humble abode that he has lived in for years. He is known for being pretty frugal. Oh, I forgot however that Mr. Buffett is a businessman though. We can’t have a businessman running our country. Actually, it would be real interesting to know where we would be today had Warren Buffett been running the country for the last 10 years. Maybe he would have consulted with other businessmen like Steve Jobs of Apple Computer or Jim Skinner of McDonald’s about the economy and job creation. Instead our president goes to CEOs like Jeffrey Immelt of General Electric and Antonio Perez of Eastman Kodak to get his advice about job creation. Is that the same Jeffrey Immelt who has had the stock of GE going backwards by an average of 3.3 percent per year over the last 10 years? Is that the same Antonio Perez who just had his company file for bankruptcy ? Eastman Kodak was once a member of the Dow Jones Industrial Average, it is now a penny stock! I don’t know about you, but when I want to lose weight, I seek out a skinny diet counselor. Now back to Berkshire Hathaway. What does President Obama’s resume look like when it comes to investing in companies? Let’s see, there was some $520 million that went into Solyndra. How did that one turn out? Did the investment go there on merit or favoritism? What would Buffet’s shareholders say if Warren made an investment that went from $520 million to zero in the span of 18 months? How did the Obama administration’s investment in Beacon Power go? Oh well, it is just taxpayer money that we don’t have. How about the billions that went into the so-called stimulus program? What kind of return are we getting on that one? While it is intriguing to think where our country might be today had a crackerjack businessman like Warren Buffett been running the show, it is an absolutely frightful thought to think where Berkshire Hathaway might be today, had Mr. Obama been at the helm for the last 10 years. This may sound like a harsh observation, but close your own eyes and ponder these questions for a minute. The bottom line is this: What we have been doing has not been working. The hole that we have to climb out of here in America is getting deeper and deeper and deeper. In fact, it is getting so deep, I think I can see Greece-austerity, strikes, riots, and bailouts anyone? We need a different skill set in the White House right now. We need a turnaround expert in the worst way. Oh, I forgot that a businessman cannot run a country. If a bunch of politicians can run the country into the ground, I feel pretty confident that it will take some businessmen to turn it around.

Read the full article →

Fake Suicide Call Prompts Woman To Sue Big Bank

February 10, 2012

These days, debt collectors are putting some people through so much pain that it’s landing them in the hospital. Anne Sessions of Lane County, Oregon is suing Wells Fargo after one of its debt collectors reported to police that that the 85-year-old was threatening suicide, a claim she maintains was false, The Oregonian reports . After hitting financial trouble, Sessions says she arranged a payment plan for her credit card debt with Wells Fargo last year, but just days later she allegedly received a call from a debt collector who badgered her with a “contemptous tone,” according to the lawsuit. Sessions told the collector that such abuse may cause other customers to take their own lives, which allegedly prompted a line of questioning that included the collector asking Sessions: “But…if you did [commit suicide], how would you do it – hurt yourself?” Courthouse News reports . Within a half hour police arrived at Sessions’ door and forcibly took her to the hospital. She was released hours later after hospital staff said they “strongly” believed Sessions was not a threat to herself or others, ABC News reports . But the incident left Sessions stuck with a hospital bill worth $1,055, for which she is seeking compensation, as well as $250,000 in punitive damages. Sessions’ suit may involve one of the more puzzling instances of debt collector abuse recently, but harassment of its kind is far from uncommon. Complaints filed to the Federal Trade Commission about debt collectors rose to 140,036 in 2010, up from 119,609 in 2009 . The boost may be explained in part by the industry’s growth in a troubled economy that’s caused many Americans to delay debt payments. Over the next three years, the debt collection industry is expected to expand by 26 percent . Indeed, all the negative reports — collection agencies are responsible for the most complaints to the FTC of any industry — may be beginning to take a toll. The FTC has begun cracking down on illegal debt collecting tactics , including repeated calls to the debtors, failure to notify consumers in writing of their rights, misrepresenting the debt in question as well as using profanity or threats. Last month it settled with Michigan-based debt collection company Asset Acceptance for $2.5 million on charges of misconduct . It also took action against two California-based collection agencies last year, one for attempting to collect debts that didn’t exist and the other for threatening to kill debtors pets and desecrete the bodies of deceased family members .

Read the full article →

Hundreds Of Millions More Dollars Of MF Global’s Money Thought Missing

February 10, 2012

The trustee overseeing MF Global’s liquidation said Friday that the shortfall between the funds under his control and the amount customers of the failed brokerage are expected to claim is at least $1.6 billion. The gap estimated by the court-appointed trustee, James Giddens, compares with his previous estimate of $1.2 billion. Giddens said in a statement Friday that the new estimate is based on his investigation and it could change again. Giddens has been combing through the accounts of MF Global since it filed for bankruptcy protection on Oct. 31. The collapse of MF Global, which was headed by former New Jersey Gov. Jon Corzine, was the eighth-largest corporate bankruptcy in U.S. history. Most of the $1.2 billion previously reported missing has been traced to customer accounts and banks. Regulators are investigating whether MF Global tapped money from clients’ accounts as its financial condition worsened. That would violate securities laws. Brokerages are required to keep customer money separate from the firm’s money. Unlike the previous figure, the new estimate of $1.6 billion includes about $700 million in customer money located in Britain. Giddens is in a legal dispute over that money with the administrator in Britain overseeing the liquidation of MF Global’s division in London. The new estimate excludes some customer claims that haven’t been filed yet. It also takes into account some funds that have been recovered since the earlier estimate was made in November. Giddens said about 40 percent of the claims filed by U.S. commodities customers of MF Global came from five states: California, Florida, Illinois, New York and Texas. Around 91 percent of the claims are for less than $100,000, according to his statement. Much of the missing money belonged to farmers, ranchers and other business owners who used MF Global to reduce their risks from the fluctuating prices of commodities such as corn and wheat. Giddens has returned about $3.9 billion to customers.

Read the full article →

S&P Downgrades Huge Number Of Italian Banks

February 10, 2012

MILAN, Feb 10 (Reuters) – Rating agency Standard & Poor’s downgraded 34 Italian banks on Friday, including heavyweights UniCredit and Intesa Sanpaolo, citing a reduced ability to roll over their wholesale debt and expected weak profitability. The move follows S&P’s downgrade of Italy’s sovereign rating last month to BBB+, part of a mass downgrade of nine euro zone countries. In a statement, S&P said its so-called Banking Industry Country Risk Assessment had worsened to group 4 from group 3 — out of 10 groups — reflecting its more negative view on Italy’s banking system. “Italy’s vulnerability to external financing risks has increased, given its high external public debt, resulting in Italian banks’ significantly diminished ability to roll over their wholesale debt,” it said. “We anticipate persistently weak profitability for Italian banks in the next few years, and a risk-adjusted return on core banking products that may not be sufficient for banks to meet their cost of capital. We believe this may be negative for the Italian banking industry’s stability.” Italian banks have borne the brunt of a sell-off in Italian assets since the euro zone’s third-largest economy was dragged into the single currency bloc’s debt crisis last summer. Because of their vast holdings of domestic government bonds, Italy’s top five banks have been asked to find some 15 billion euros by June to meet tougher capital requirements set by the European Bnaking Authority. Lenders have also been effectively shut out of wholesale debt markets and have increased their reliance on cheap funds from the European Central Bank. Italian banks tapped a whopping 116 billion euros of nearly 500 billion euros of three-year funds offered by the ECB last December, easing funding strains. A similar operation will be held at the end of February and analysts expect Italian banks to further increase their borrowing from the ECB. S&P said weak profitability and increased cost of capital could lead Italian banks to write down a large part of the goodwill they booked during a wave of industry consolidation over the past decade. Such writedowns forced UniCredit, Italy’s biggest bank by assets, to announce a 10.6 billion euro loss in the third quarter of 2011. Among the banks downgraded, Banca Monte dei Paschi di Siena and Banco Popolare had their rating cut below that of Italy’s sovereign debt. For a list of the banks affected by S&P’s downgrades, please click on

Read the full article →

Ron Davis: The Republican Nanny State

February 10, 2012

Republicans who support subsidies should stop their mass-manipulation. Rather than hiding behind hypocritical pro-market rhetoric, it is time to admit they have embraced their very own entitlement-boom that rivals the dreams of any European welfarist. Matt Kibbe recently wailed in Forbes about a “tort litigation nightmare” because a court granted a large award to a woman paralyzed from the neck down by a company’s negligence. And last week in the Wall Street Journal , Senator Ron Johnson of Wisconsin decried the EPA and the Department of Labor’s increased regulation because of its “job crushing… cost” to businesses. “Cost” is a strange adjective to describe all these rules when many actually serve to stop current subsidies. Senator Johnson unsurprisingly failed to mention the excruciating economic cost-benefit scrutiny applied to regulations by the Office of Information and Regulatory Affairs (OIRA), recently famous for rejecting the EPA’s smog rules. Both point toward an ironic truth: mainstream Republicanism has rejected market economics in favor of a subsidy-loving conservative nanny-state. Subsidies, as economists tell us, insulate people from the true costs (or consequences) of their behavior. And market efficiencies and the economic growth they create get undermined when people don’t pay full price. Even more disturbing, these handout-loving Republican pundits and politicians regularly and cynically deceive rank and file believers in personal responsibility by using free-market sounding language to distract citizens from their constituents’ reliance on public support. These interest group puppets start by pretending that the only subsidies come from governments. But any economist will tell you this is nonsense. Inefficient subsidies flow from more than just the national treasury. In fact, sometimes only the government can shut off this golden faucet. Economists call these decision-distorting efficiency killers “externalities.” An externality arises when part of the price of my behavior gets absorbed by someone else, forcing that person to subsidize my choice. For example, costs get externalized if a toy factory’s manufacturing process puts toxic chemicals in the groundwater, and the neighbors get stuck paying for part of the toy making process — by shouldering lowered property value, experiencing illness, or getting stuck with the bill for cleaning up the mess. This is one reason why we compensate people through lawsuits — to make sure the toy factory, not its neighbors, pays the full price for its behavior. But Republicans leaders seem bent on forcing their backers’ costs onto others. House Majority Leader Eric Cantor (R-VA) opposes greenhouse gas taxes, arguing they would “cost our economy billions of dollars [and] destroy jobs.” Certainly such taxes do encourage what economists call “creative destruction,” another market miracle where inefficient providers get put out to pasture. But then better providers take their place, which is why markets are good for business. The supposedly job-killing pollution taxes would remove the ventilator from these market-insulated companies and expose them for what they are — corporate welfare queens. When I drive a car, or operate a coal factory, many people pay the price for my emissions. These hurt other consumers and businesses, future citizens who clean up the mess, or Bangladeshis swamped by floodwaters. Whatever one’s position on climate change, we all know that pollution costs something , and when we pollute without paying the full cost — we act like people do on someone else’s dime. We overindulge. No wonder the misery of traffic. If Matt Kibbe had his way, he would eliminate the “tort litigation nightmare.” But doing so would allow a host of externalities, forcing people to subsidize others’ negligence. Consider medical malpractice compensation caps. If an architect makes $200k a year with ten working years ahead of her, and a surgeon commits professional negligence that destroys the architect’s ability to work, that poor architect faces a $2 million loss. But with a tort liability cap of $1 million, the surgeon will only pay for half the cost of his bad behavior. The injured architect would have to subsidize the surgeon’s practice. Systemic risk, also an externality, recently reared its ugly head. If, after Lehman collapsed, the banking sector had failed, its employees and stockholders would certainly have paid a tremendous price. But this would only amount to a fraction of the total cost paid by the rest of the world. Bailouts may have saved world markets from depression, but our citizens have paid dearly — recession, a feeble recovery, and mounds of debt to cover tax cuts and stimulus spending. But we can’t just bill the banks for this mess after the fact because the tab dwarfs bank resources. Unlike the polluting factory or the negligent doctor, a court judgment cannot make the banks face the full cleanup cost. We don’t begrudge banks for trying to turn a big profit, but citizens shouldn’t be forced to subsidize it either. Since we cannot afford to let the financial markets fail, systemic risk must be regulated up-front, rather than paid for after the fact. Those who fight bank regulations designed to minimize systemic risk actually work to preserve mammoth bank subsidies — because the banks can never take on the full risk-cost of their risky behavior. The list goes on. Globalization displaces workers, which means the displaced pick up most of the tab for our economic gains. The rising tide may lift all boats, but it drowns a few people too. When we refuse to compensate them accordingly — through retraining and other assistance — we force them to subsidize our fortunes. Accordingly, last summer, Senate Minority Leader Mitch McConnell (R-KY) threatened to block a free trade deal with South Korea unless the White House dropped the provision for the Trade Adjustment Assistance program, which helps retrain displaced workers. Mr. McConnell apparently believes these workers should subsidize the rest of us. The issues above are, of course, complex along many dimensions not discussed here. But the truth remains: Some kinds of taxes and regulations actually stop subsidies, and market rhetoric frequently hypocritically helps conceal colossal handouts. These Republican leaders are right about one thing. The jobs that rely on subsidies will be killed if externality entitlements get taken away. But they will be replaced by a more efficient, prosperous economy and the jobs that come with it. Forcing companies and people to internalize the costs of their behavior is not bad for businesses in general. Just the ones with their hands in someone else’s pocket.

Read the full article →

Mohamed A. El-Erian: "Half-Time in America" Highlights Our Political Dysfunctionality

February 10, 2012

Viewed as a standalone, the controversy generated by the Clint Eastwood Superbowl commercial is really silly. Yet it points to something profound that has and, if left unaddressed, will continue to undermine America’s ability to regain economic dynamism, create ample jobs, and deal with growing inequalities. In the event that you are one of the few who missed it, Clint Eastwood starred on Sunday in a commercial that NBC aired at half time. The message was powerful. Yes, America has stumbled, with people out of work, hurting and scared. But, by pulling together and acting as one, Americans will come from behind and win. “That’s what we do.” The concluding remarks were particularly potent: “This country can’t be knocked out by one punch. We get right back up; and when we do, the world will hear the roar of our engines.” Given that it was financed by Chrysler, the commercial’s direct reference was, of course, to the impressive recovery in Detroit’s car industry. But the intention, and the impact, went well beyond that. What Detroit has done, America as a whole can and will do. Coming on the heels of a series of favorable economic data releases — which will hopefully persist though this is far from certain unfortunately — the ad spoke to the hope that America is recovering and that our economy is building encouraging momentum. This is particularly important for the job market where we need to improve on the 243,000 positions created in January to meaningfully address our unemployment crisis, tackle the problem of long-term joblessness, counter the mounting obstacles to youth employment, and stop the worsening of income and wealth inequalities. You would think that this feel good message would be a unifying one for our political class. Far from it. Several Republicans complained this week that Clint Eastwood was implicitly supporting Barack Obama. After all, the commercial could be interpreted as suggesting that, under President Obama, America has turned the corner and is now embarking on a path to prosperity — something that most Republicans dismiss. Democrats were quick to counter. On the contrary they shouted. If anything, “Half Time in America” was pro-Republican. It could easily be viewed as implying the need for a change in game plan and personnel substitutions — similar to what a losing team would discuss in the locker room at half time in order to regain control of the game and win. This morning on CNBC’s Squawk Box , Clint Eastwood shared his views. His message was direct and unambiguous: Take the commercial for what it is — a message about Americans’ ability to overcome our problems and march forward to a better future. It is easy, indeed tempting, to dismiss all this political squabbling as indicative of the silliness that is inevitable during an election season. I certainly would like to do so. Yet I fear that it goes well beyond that. This is yet another illustration of the deep political dysfunctionality that continuously undermines DC’s willingness and ability to move forward with the much-needed revitalization of the economy. The longer this continues, the greater the costs and the harder the solutions. In the short-term, the cyclical economic bounce of the last few months — powered by large injections of global central bank liquidity and a once-for-all decline in the personnel savings rate — would end up suffering the same fate as in early 2010 and 2011: fizzling out rather than handing off to durable engines of investment, growth and jobs. In the longer-term, America would find it even more challenging to overcome structural impediments that, each day, are getting more deeply embedded in the construct of our economy. For the sake of both current and future generations, let us hope that Clint Eastwood’s “Half Time in America” commercial will be remembered for more than just igniting yet another round of political bickering and finger pointing.

Read the full article →

Adele Scheele: Making Meetings Mean Something

February 10, 2012

For some companies, the usual Monday morning meeting is becoming unusual. It is revamping itself, becoming a stand-up, short-lived check-in. For those who still endure the old sit-down conference table version, the format is unbearably predictable: the boss unceremoniously starts the meeting by reading the agenda, reciting the latest sales report, warning of anticipated obstacles, and then spends the remainder of the time discussing the pet peeves and projects of the few most vocal employees excluding everyone else. Or else there are the endless arguments over old issues that never get resolved. For many of us, coping with meetings is more stressful than doing the actual work — it often feels like not much is accomplished. Sixty to ninety minutes of tortuous boredom leads to anger, which, in turn, leads to withdrawing to keep from exploding or else becoming a comedian to camouflage emotions. Most of us are stuck in a frustrating situation we feel unable to change. Maybe the only people who don’t bristle during routine, energy-sapping staff meetings are the managers who call them and those unlucky ones whose jobs are even more unbearable than the meetings. Instead of increasing your blood pressure or clenching your jaws, why not try to turn the situation around to our own advantage? Here are some tactics that can lead you to a more effective meeting outcome and better mood: 1. Start by changing your own role. Play host early and greet people by asking each about some recent good news. Share yours too. 2. During meetings, compliment any good idea out loud and suggest ways it might benefit your group. If two ideas offered are similar or complementary, suggest a way to incorporate both. 3. When factual disputes arise, suggest an immediate decision on principle, rather than fact. 4. When the old, unresolved issue rears its ugly head again, suggest a way towards resolution; perhaps a debate. Offer to find someone who can act as a debate coach, working with your group divided into opposing teams. In a short time, perhaps only two hours, a rational decision can be forged to everyone’s relief. 5. When you want to introduce an idea, be strategic. Don’t bring it up by the usual method — flinging it into the middle of the table and hoping that others will respond. Nobody does. Ideas, even good ones, usually fall flat. Instead, prior to the meeting, garner support from your leader and several members of the team so that you are backed up and can ensure better results. 6. Invent more roles to play during different meetings. Ask questions to elicit action or piggyback on a good idea or project. Just don’t play antagonist or devil’s advocate more than once. 7. Summarize what has already been agreed to; note new agenda items from stray conversations for subsequent meetings. 8. After a major project, suggest that each team member tell what he or she has contributed. Then go around again asking them to tell what they would do differently if the project were repeated. Record their remarks from what they’ve learned and see how you can use them next time. Don’t be deterred by flack by others who think you are overstepping; try to get them involved too. You might talk to your manager about how to gather what’s been learned to make the next projects more effective. 9. Of course, not every plan will work every time. But it’s worth a try. More than a try. Not only does trying keep your anger quotient and your blood pressure down, but it gives you a chance to realize what the rest of your group craves — someone willing to change things so that they will work better. Let that someone be you! Make your luck happen!

Read the full article →

Awful Cover Letter To J.P. Morgan Laughing Stock Of Wall Street

February 10, 2012

It takes a lot to get noticed in this town, but there’s a right way and a wrong way to do it. An NYU undergraduate student named Mark has become the laughing stock of Wall Street after his awful cover letter to J.P Morgan made its rounds among NYU Stern alumni, the financial district, and then went viral online. A cover letter can make or break you in the job hunting game and Mark’s letter is a lesson in exactly what not to do. By boasting that he “managed to bench double [his] body weight and do 35 pull ups” while achieving a 3.93 GPA, young Mark invited the inevitable comparisons to the infamous Aleksey Vayner . There’s a fine line between convincing your potential employeer of why they need to hire you, and only you, and coming across as a pompous ass. There is no doubt Mark’s status as a triple major in Mathematics, Economics and Computer Science is impressive on its own, but throw in the fact that he held two part-time jobs, placed-out of two classes and managed to keep himself in top physical shape, and it’s safe to say he crossed the line. Mark’s cover letter also could have used an edit from an English major, who might have advised him to find a different way to express that he “can perform basic office functions with terrifying efficiency.” He ended the letter with a disclaimer asking J.P. Morgan to “Please realize that I am not a braggart or conceited, I just wanted to outline my usefulness. Egos can be a huge liability, and I try not to have one.” Nice. It’s a letter so obnoxious that it’s unclear if Mark sent it as a joke. According to Gawker, Mark is well aware bit of laughter he brought to the bankers on Wall Street. When asked if he’d gotten a job at J.P Morgan, he laughed, telling the website , “No, not at all. Didn’t you see my letter?” Joke or not, Mark is not alone when it comes to terrible cover letters. An applicant for a position as an API Engineer in New York City recently wrote : “I’m super awesome and have incredible experience compared to this — it includes the required experiences below plus I am trained in MMA fighting, am the mayor of multiple Chipotles, Starbucks, and locally famous restaurants in downtown NYC, and I type really fast.” And we can’t forget Roanald Dvorak’s cover letter for a office manager position, where he wrote : “Forget all the other candidates for Aviary, I am the BEST,” and listed his skills in bullet points: “Organizing shit? Check. Calling numbers and shit? Doublecheck. Customer support and shit? Mega-check. Faxing numbers and shit? MOTHERFLIPPING CHECK ALL OVER THAT.” At a time when even the most qualified applicants can’t find jobs , it’s questionable if sending over-the-top or ironic cover letters is a good idea — especially given the fact that there’s no expectation of privacy. Last year, Business Insider even posted 12 of the worst cover letters they received, redacting the names to provide some protection for those who made the list. READ THE COVER LETTER: 1/23/2012 J.P. Morgan Dear Sir or Madame: I am an ambitious undergraduate at NYU triple majoring in Mathematics, Economics, and Computer Science. I am a punctual, personable, and shrewd individual, yet I have a quality which I pride myself on more than any of these. I am unequivocally the most unflaggingly hard worker I know, and I love self-improvement. I have always felt that my time should be spent wisely, so I continuously challenge myself; I left Villanova because the work was too easy. Once I realized I could achieve a perfect GPA while holding a part-time job at NYU, I decided to redouble my effort by placing out of two classes, taking two honors classes, and holding two part-time jobs. That semester I achieved a 3.93, and in the same time I managed to bench double my bodyweight and do 35 pull-ups. I say these things only because solid evidence is more convincing than unverifiable statements, and I want to demonstrate that I am a hard worker. J.P. Morgan is a firm with a reputation that precedes itself and employees who represent only the best and rightest in finance. I know that the employees in this firm will push me to excellence, especially within the Investment Banking division. In fact, one of the supporting reasons I chose Investment Banking over any other division was that I know it is difficult. I hope to augment my character by diligently working for the professionals at Morgan Stanley, and I feel I have much to offer in return. I am proficient in several programming languages, and I can pick up a new one very quickly. For instance, I learned a years worth of Java from NYU in 27 days on my own; this is how I placed out of two including: Money and Banking, Analysis, Game Theory, Probability and Statistics. Even further, I am taking Machine Learning and Probabilistic Graphical Modeling currently, two programming courses offered by Stanford, so that I may truly offer the most if I am accepted. I am proficient with Bloomberg terminals, excellent with excel, and can perform basic office functions with terrifying efficiency. I have plenty of experience in the professional world through my internship at Merrill Lynch, and my research assistant position at NYU. In fact, my most recent employer has found me so useful that he promoted me to a Research Assistant and an official CTED intern. This role is usually reserved for Masters students, but my employer gave the title to me so that he could give me more work. Please realize that I am not a braggart or conceited, I just want to outline my usefulness. Egos can be a huge liability, and I try not to have one. Thank you so much for your time, and I look forward to hearing from you. Best, Mark

Read the full article →

Mathias Terheggen: The Wealth Gap Challenge

February 10, 2012

Philanthropy and the wealth gap challenge Economic growth and the question of its “if and when” is a very popular topic these days. Analysts have been providing outlooks on 2012′s economic development. But in their attempts to foresee the future one thing is already clear: regardless of how the economies will develop, the outcome is going to be more positive for those who already have and earn a lot compared to the financially less fortunate. This phenomenon, the “wealth gap,” is not new and we have become used to the fact that, with few exceptions, particularly in developing countries the wealth disparity is growing steadily. What is new though is that within developed economies — among them are some of the strongest globally — the wealth gap is widening too. Countries as diverse as the U.S., Italy and Germany all have grown their Gini-coefficient, a measure of income inequality, over the last 30 years. And even Hong Kong, whose economy grew by over 6% at 3% unemployment last year, not only holds a global record for growing the number of millionaires but also, or maybe therefore, one for the highest income inequality ratio among developed economies. An ever-growing challenge This has given rise to substantial concern. While low levels of economic inequality are desirable to maintain an impetus for individual economic development, a large wealth gap is known to discourage individual economic efforts which, in turn, results in lessened economic power for large parts of the society. Public upheaval and political revolutions as seen during the Arab Spring are only the most blatant symptoms of the detrimental effect on societies caused by limited economic opportunity and unfair wealth distribution. With low-income households statistically producing a higher number of off-spring, strong income inequality virtually results in an increasing number of children slipping off into poverty, poor healthcare and education. The generation responsible for long-term economic growth is hence disengaged, and a society’s ability to innovate from within itself jeopardized. Ultimately, this will limit the future economic potential also of those on the more fortunate side of the wealth gap, too. Donating doesn’t do the trick The economic crisis of 2008 caused a tightening of public budgets which, in turn, has resulted in reductions of social welfare. This has led to a more critical public view on the financially successful, and so the wealthy nowadays have both an intrinsic and an extrinsic motivation to re-consider their role in dealing with the wealth gap and related social issues. It comes by no surprise that therefore the past years have seen many wealthy go public with their social engagement and openly demand more substantial measures to foster social equality from their peers. The public response has been very mixed with reactions reaching from friendly acknowledgement to acid accusations of fig-leaf efforts. A closer look at the role private philanthropy can play in closing the wealth gap might therefore be appropriate. One myth to make away with at the outset is that donations to the poor won’t solve the wealth gap challenge. While total global private giving is estimated to exceed USD 600 bn annually, this amount represented less than half of the wealth transferred from the bottom 80 to the top 20 percent of households in the US during the financial crisis from 2007 to 2009 alone. Hence, private philanthropy by wealthy individuals must play a different role if it means to prevent societies from getting destabilized. An entrepreneurial approach Indeed, philanthropy can have a catalytic role in encouraging and supporting social innovation: being liable to their own preferences and requirements only, as opposed to donors like most public fund-raising non-profit organisations, philanthropists can take higher risks like funding interventions and organizations in early stages of development. Philanthropists can afford the risk for a project to default, e.g., through a project owner’s unexpected death, knowing that the draw-back will be off- set by other successful initiatives within their portfolio. In addition, today’s private donors are increasingly seeking ways to make their social engagement not only more strategic and long-term in order to achieve systemic change, but they go far beyond their mere financial contributions. Building on their professional success they leverage their knowledge and network, engage non-financial capacities like companies and employees, and most importantly, they apply their mind-set and experience as an entrepreneurs and investors to their philanthropy. Addressing social issues with an entrepreneurial approach including the idea of revenue generation through the provision of social products and services has resulted in efficiency and scalability and triggered some of the most remarkable recent trends in the social sector. On the giving side Venture Philanthropy and Impact Investing have taken giving beyond grants towards actual investments that include the expectation of a financial return for the investor. The ratio of social versus financial return generated by the investment may vary depending on the social investor’s priorities. But the mere fact of making an investment, rather than giving money away, has a groundbreaking effect on the recipient’s commitment, not least as it is an explicit sign of trust in the recipient’s abilities. All these trends yield social interventions that often address social issues that weren’t addressable before. But in all cases they increase the efficiency and effectiveness thereby growing the social impact. Enabler and catalyser It is through this role as enabler, supporter and advocate of social innovation that private philanthropy addresses the wealth gap challenge: not only do they deliver new social interventions, but by using their extensive networks and acting as figures of public influence they promote what ultimately will be adopted by larger non-profit organisations and, increasingly, by governments. Especially the latter are turning towards private philanthropy on their search for social innovation that enables the public sector to fulfill its social mandate while minding the costs. The recent launch of a program by the German bank for economic development, KfW, that provides financing to social entrepreneurs under the condition that they can secure additional funding by private donors, is an apt example of governments trying to harness the innovative power of private philanthropists. These interventions will increase the ability of the less fortunate both in developed or developing countries to have access to appropriate healthcare and education. This will help lay the foundations for future economic growth and participation in it: by linking private philanthropy of the wealthy to the economic participation of the less wealthy, the social fabric that makes for a stable, fair society is strengthened. Transparency to gain momentum Private philanthropy will not balance societies that are otherwise challenged in their social cohesion through an overly inhomogeneous distribution of wealth and income. But it can, if done credibly, be a starting point for systemic change — all the while shaping the future of the wealthy, too. Transparency on individual efforts could create the desired momentum as it allows for discussions on objectives and priorities as well as for collaboration. However, given the reputational risk and the challenges of building a successful philanthropic track record, such transparency may at first only be acceptable within the peer group. Closed conferences, of which there aren’t too many yet, but where leading philanthropists, experts and social-sector professionals gather to exchange knowledge and further their philanthropy, have proven to be a very effective means. Very often such gatherings boost alliances around a shared theme of interest, they build scale and subsequently become visible to the broader public including private, public and civil sector organizations.

Read the full article →

The 10 Tech Companies Taking The Biggest Stand Against Climate Change

February 10, 2012

How are some of the world’s biggest IT companies taking a stand against a climate change? A list released by Greenpeace this week ranks some of the world’s largest information technology companies based on their efforts to mitigate climate change. The fifth edition of the Cool IT Leaderboard puts Google at the top, with Cisco and Ericsson grabbing second and third. According to a press release , the list “ranks 21 IT companies on their clean energy leadership potential, willingness to embrace clean energy solutions and potential to influence energy decisions.” Neither Apple nor Facebook were included in the list, as they have not pursued “market opportunities to drive IT energy solutions” to the same extent as others, according to Greenpeace. Greenpeace International IT analyst Gary Cook said, “Technology giants have a real opportunity to use their power and influence to change how we produce and use energy — Google tops the table because it’s putting its money where its mouth is by pumping investment into renewable energy.” As Wired notes, the highest scoring company, Google, only received a score of 53 out of 100 . Cisco was last year’s winner, with 70 points, but dropped to 49 this year. Greenpeace says Cisco’s fall is due to “a much less forceful support for priority climate and energy policies.” For more information on some of the greenest companies around, check out Newsweek’s 2011 list of the 30 greenest tech companies . List courtesy of Greenpeace . Read their full report here . Scroll down for the companies ranked 11-21. The companies which did not make the top 10 include: 11. Wipro 12. Dell 13. Microsoft 14. SAP 15. AT&T 16. HCL 17. NTT 18. NEC 19. TCS 20. Telefónica 21. Oracle

Read the full article →

Nathan Gardels: Democracy Is Not Self-Correcting

February 10, 2012

Recently, I wrote an article posted here about the protests in Italy against the “undemocratic” government of meritocrats in Italy led by Prime Minister Mario Monti. Many responders, following the German philosopher Jurgen Habermas, worry that Europe is entering a “post-democratic” phase, not just because of a government like Monti’s, but because European institutions, such as the appointed European Commission, are seen to be beyond the accountability of the public. Behind such sentiments is a suspicion of delegated authority of any kind in democratic societies. My response is to consider this: The argument against the delegated authority of meritocracy based on experience and expertise is that it can get it wrong without adequate feedback. Without the capacity to self-correct it can end up oppressing the people instead of serving them. The argument for one-person-one-vote democracy always is that it gets is right because, like the free market,it is self-correcting. But that is no truer for democracy than for the market, as we saw in the 2008-09 financial crisis. Democracy, both representative and direct, also has its rigidities (ideology, populism, self-interest of voters, money as free speech). Often the accumulation of individual choices produces unintended consequences against the public good. As I pointed out in my earlier article, after a series of direct democracy initiatives to curb property taxes and punish criminals, California now spends more on prisons than higher education, thus undermining the foundations of its future. What matters for good governance is an open society — freedom of expression and the rule of law to protect feedback — not whether the system is meritocratic, democratic or a hybrid. Is China’s “monitory webocracy,” where the Communist government is acutely responsive to the public clamor over weibo on everything from tainted milk or toys to train wrecks to pollution, any less self-correcting than American democracy where the Wall Street banks that precipitated the financial crisis and were bailed out because they were “too big to fail” are now even larger and remain unregulated?

Read the full article →

Owner Of ‘Illegal’ California Gold Mine Surrenders To Face Charges

February 10, 2012

SACRAMENTO, Calif. (AP) — A man who state and local officials say is running a massive illegal gold-mining operation in California’s Sierra Nevada surrendered Thursday to face 14 criminal charges of operating without permits and polluting a creek. Joseph Hardesty also faces state fines of nearly $900,000. He was booked into El Dorado County Jail on the charges, which include four felonies, and was being held in lieu of $75,000 bond. His attorney, William Brewer, says Hardesty turned himself in after investigators from the district attorney’s office searched for him at his mother’s home and the home of his partner in the Big Cut Mine, near Placerville. Hardesty surrendered a day after The Associated Press published a story about the mine, which is in the Sierra foothills between Sacramento and Lake Tahoe, and his three-year battle with authorities. “It’s unfortunate that our government has decided in this case to take away our liberties and our rights without adequate process,” said Brewer, of San Diego. “Joe really is a very honorable person and I just wish things were different.” He denies his client is mining gold, saying he is operating a sand and gravel business to complement another he owns in Sacramento County. State and local officials say they have evidence and statements indicating the site is being mined for gold at a time when the precious metal’s price is hovering near $1,700 an ounce. Hardesty, 54, had promised to surrender last week but failed to appear. Authorities said Hardesty turned himself in at the sheriff department’s office in Placerville about 11:30 a.m. and was taken to jail without incident. Brewer said investigators had looked for his client everywhere except where he was — his home in Elk Grove, south of Sacramento. Hardesty contends that he has a historic right to operate the Big Cut Mine on nearly 150 acres he bought seven years ago, based on a reclamation plan he had filed with El Dorado County in 2009 and $188,000 in bonds. Local authorities and the State Mining and Geology Board disagree. On top of the mining board’s fines, El Dorado County charged Hardesty with mining and grading without permits, working despite stop orders, releasing sediment into Weber Creek, violating zoning laws, and using hazardous materials without proper permits. Hardesty, his wife, Yvette, and his partner, Rick Churches, brought in heavy equipment to cut into a steep ridge high above the creek, although Joseph Hardesty is the only one facing charges. The site is guarded by locked gates covered with “no trespassing” signs, but an AP reporter and photographer were able to view the mining operation from a heavily forested ridge a few hundred yards away. Late last month, local and state inspectors with a warrant entered the property and documented at least 30 acres stripped bare, four drainage ponds and a football-field-sized gravel bed about 60 feet deep. Inspectors previously found gold on what is called a shaker table, which is used to separate the heavy metal from sand and gravel. Bruce Person, an engineer with the county transportation department who helped inspect the property, said a previous owner found an ancient riverbed on the property could produce between 1 and 3 ounces of gold for every ton of material. El Dorado County Deputy District Attorney Michael Pizzuti declined to comment Thursday on Hardesty’s arrest. He previously told the AP that Hardesty’s partner told a county inspector that they intended to remove gold and sell the rocks it was separated from as gravel. Hardesty already was on probation after pleading no contest last year to a misdemeanor charge of storing unpermitted hazardous waste in Sacramento County. He now faces allegations that he violated his probation by continuing to operate at both the Sacramento and El Dorado locations. The fines were levied in January by the State Mining and Geology Board, a division of the California Department of Conservation. The penalty climbs by $15,000 for each day he continued to operate.

Read the full article →

Elliott Negin: Monsanto’s Great Expectations (and Not-So-Great Results)

February 10, 2012

Photo: Russell Max Simon With apologies to Charles Dickens, whose 200th birthday was this week, it’s the best of times and the worst of times for Monsanto, the agribusiness giant that is aggressively marketing genetically engineered crops — and millions of tons of pesticides — worldwide. It’s the best of times because its stock is soaring. Sure, the St. Louis-based leviathan has been up before — and down. In 2009, Forbes magazine proclaimed it company of the year. The next year its stock tanked, and Mad Money TV host Jim Cramer proclaimed it the worst of 2010. Now its up again, and last month Forbes was hyperventilating over the fact Monsanto has outperformed most high-tech stocks over the last five years. But just like the plot in Charles Dickens’ Great Expectations , Forbes ‘ rosy scenario is not the whole story. You may vaguely remember the 19th century novel from high school English. According to a column in last Sunday’s Washington Post , its main lesson is: “You will never fully comprehend the most important events in your life while they are happening. Any plans you make will not work out — and you may grow up to be a jerk. If you are lucky, however, a series of traumatic events will wake you up and show you how insufferable you have become.” If you replace the book’s protagonist Pip with Monsanto and look at the company through the prism of science instead of its stock profile, my tortured analogy makes sense. Despite more than 20 years of research and 15 years of marketing, Monsanto’s great expectation that genetic engineering would dramatically increase food production and reduce pesticide use has been dashed. Unlike Pip, however, the company has not yet woken up to the fact that its products don’t perform as advertised. That’s why it’s also the worst of times. Doug Gurian-Sherman, a molecular biologist with the Union of Concerned Scientists (UCS), has spent quite a bit of time investigating Monsanto’s track record. In April 2009, he published ” Failure to Yield ,” the only comprehensive study to date that separates genetic engineering’s contribution from other factors that can increase yields. After reviewing two dozen academic studies of corn and soybeans — the two primary genetically engineered food and feed crops in the United States — he found that genetically engineered traits in herbicide-tolerant soybeans and herbicide-tolerant corn have not increased yields, and insect-resistant traits have improved corn yields only marginally. The substantial increase in yields for both crops over the previous 13 years was largely due to traditional breeding and better agricultural practices, not genetically engineered traits. More recently — just a few days ago, in fact — Gurian-Sherman and his colleagues in UCS’s Food and Environment Program posted a web feature, ” Eight Ways Monsanto Fails at Sustainable Agriculture ,” documenting how Monsanto has broadly failed to deliver on its promise to increase yields, safeguard the environment, and protect farmers’ livelihoods over the long run. “Monsanto talks about ‘producing more,’ ‘conserving more,’ and ‘improving lives,’ but it’s a PR fantasy,” said Gurian-Sherman. “In reality, the company is doing a great job selling more engineered seeds and herbicide and fattening its bottom line at the expense of the environment. To be sure, there are a lot of farmers who buy Monsanto seed, but they buy it mainly because it’s convenient, it saves them time, and it does kill some pests. That doesn’t mean that it’s better for the environment.” Besides the fact that Monsanto’s genetically engineered traits have failed to substantially increase yields, its heavy promotion of crops designed to be impervious to the company’s RoundUp herbicide has inadvertently created resistant “super” weeds, UCS experts report. That not only can make farming more difficult and costly, it forces farmers to use even more herbicides, which threatens the environment and public health. UCS also found that Monsanto’s focus on genetic engineering and chemical fixes thwarts research and development of cheaper, more effective solutions, including public sector classical crop breeding and environmentally friendly farming methods. Given the unvarnished facts, how has Monsanto been able to convince anyone that it is, according to its latest PR effort, “improving agriculture and improving lives”? In large part by spending tens of millions of dollars annually on advertising, lobbying and campaign contributions. In the fall of 2008, Monsanto launched an advertising campaign that continues to this day. An outgrowth of the company’s “sustainable yield initiative,” it has targeted opinion leaders and federal policymakers with full-page ads in the Atlantic Monthly , New Yorker , New Republic and other elite publications, as well as with posters in subway stations, on bus shelters, and on the sides of metro buses here in Washington. Last year, Monsanto spent $100 million on the ad campaign, down slightly from the $120 million it spent in 2010, according to Securities and Exchange Commission figures . The company also spent $6.37 million on lobbying –more than any other agricultural company or trade group–and so far has contributed more than $170,000 to political campaigns in the 2011-2012 election cycle, the third highest in the agricultural sector. Monsanto’s claims in earlier ads were more explicit than ones circulating now. For example, an ad on the New Yorker ‘s back cover that ran the same week Gurian-Sherman released his “Failure to Yield” report back in 2009 stated : “Providing abundant and accessible food means putting the latest science-based tools in farmers’ hands, including advanced hybrid and biotech seeds. Monsanto’s advanced seeds not only significantly increase crop yields, they use fewer key resources — like land and fuel — to do it. That’s a win-win for people, and the earth itself.” The company’s latest print ads , which all feature the headline “Improving agriculture, improving lives,” are toned down by comparison. They insinuate that Monsanto is accomplishing something grand and noble instead of making demonstrably false claims. For example, one ad states: “In the hands of farmers, better seeds can help protect resources and promote biodiversity.” Another one states: “In the hands of farmers, better seeds can help meet the needs of our rapidly growing population, while protecting the earth’s natural resources.” They all wrap up with: “That’s improving agriculture. That’s improving lives. And that’s what Monsanto is all about.” The best response to Monsanto’s misleading ad campaign? A well-worn quote from Great Expectations : “Take nothing on its looks; take everything on evidence. There’s no better rule.” Elliott Negin is the director of news and commentary at the Union of Concerned Scientists. For information on how to get involved with UCS’s effort to set the record straight on Monsanto, click here .

Read the full article →

When The Poor Have Health Care Coverage, The Cost Goes Down For All

February 10, 2012

The concept of support for universal health care is taboo among Republicans who scrutinize the Affordable Care Act — dubbing it the “Job-Killing Health Care Law Act” — and call for its repeal. But a new UC Irvine study challenges the GOP argument that the health care law is too costly, with data illustrating that health care costs on the whole fall when poorer, uninsured patients are provided with insurance. “In a case study involving low-income people enrolled in a community-based health insurance program, we found that use of primary care increased but use of emergency services fell, and — over time — total health care costs declined,” David Neumark, a co-author of the study, said in a release accompanying the findings. The study — which focused on uninsured people in Richmond, Virginia who fell 200 percent below the poverty line — found that over three years, health care costs fell by almost 50 percent per participant, from $8,899 in the first year to $4,569 in the third after they received insurance. Participants who enrolled in health coverage made fewer trips to the emergency room, which are notorious for running up patient bills. Instead, insured participants went for more primary care visits. “A lot of the debate about health care reform surrounds the issue of whether we’re setting up something that’s going to cost us more by increasing use of medical services or something that will cut costs through more appropriate and timely use of medical services,” Neumark said in the release. “[O]ver time, costs can be reduced through increased use of primary care and reductions in emergency-department visits and hospital admissions, but it may take several years of coverage for substantive savings to occur.” Health care spending in the U.S. has been on the rise for years. Americans spent more than three times on health care in 2008 than they spent in the 18 years before, according to a Kaiser report. Low-income, uninsured individuals tend to rack up exorbitant health-care bills because they often rely on emergency room visits instead of primary care. In the long run, these bills are paid by taxpayers. The Affordable Care Act “is set to extend Medicaid benefits to about 16 million uninsured, low-income adults and children by the end of 2014,” according to the study. In an extreme example of the societal cost of leaving some uninsured, New Yorker writer Malcolm Gladwell once chronicled the medical costs of a homeless man in Nevada who “used more health-care dollars, after all, than almost anyone in the state.” “It would probably have been cheaper to give him a full-time nurse and his own apartment,” Gladwell wrote. Mandatory health care already saw some success in Massachusetts last decade, when current GOP presidential candidate and then-Massachusetts governor Mitt Romney signed a health care law that inspired the Affordable Care Act. Today, Massachusetts has the highest percentage of insured residents of any state . Though he initially supported the plan, Romney’s rival, GOP candidate Newt Gingrich, continues to slam Romney for enacting the health care law. “Your plan essentially is one more big-government, bureaucratic high-cost system.” Gingrich said . Gingrich’s views are reflective of a majority of Americans who say they are in favor of repealing the health care law. A repeal of the act could potentially add “at least a trillion dollars to the deficit,” according to HealthCare.gov .

Read the full article →

The Story Of Obama’s Brush With Political Disaster

February 10, 2012

Shortly after four o’clock on the afternoon of Wednesday, April 13, 2011, U.S. Treasury Secretary Tim Geithner walked down the hallway near his office toward a large conference room facing the building’s interior. He was accompanied by a retinue of counselors and aides. When they arrived in the room — known around Treasury simply as “the large” — four people were seated at a long walnut table on the side near the door. Geithner and his entourage greeted them, then walked around to the far side and took their seats.

Read the full article →

Another Big Bank Slashes Its Bonus Pool

February 10, 2012

LONDON — Barclays PLC revealed Friday that it is slashing its bonus pool after earnings at its investment banking division fell sharply and dented overall profitability. The bank said it was taking the action as it reported that its profit after taxes fell 15 percent last year to 3 billion pounds ($4.8 billion) from 3.56 billion pounds the year before even though income rose 2.6 percent to 33 billion pounds. Much of the profit decline was due to a 32 percent fall in pretax profit at the Barclays Capital investment banking unit to 2.97 billion pounds. The bank said the average bonus for Barclays Capital employees will be 64,000 pounds ($101,000), down 30 percent from 2010. The total bonus pool was cut by 25 percent and the average bonus per employee will be 21 percent lower at 15,200 pounds. “We need to balance remaining competitive with being responsive to the public mood,” Chief Executive Bob Diamond told reporters after the publication of the results. Bonuses are a highly sensitive political issue in Britain, particularly at Royal Bank of Scotland and Lloyds Banking Group which were bailed out by taxpayers. Lloyds chief executive Antonio Horta-Osorio and RBS CEO Stephen Hester have both waived their bonuses, though Hester did so only after coming under intense political pressure. Barclays said bonuses for executive directors and the eight highest paid senior executive officers would be down 48 versus 2010 on a like-for-like basis. Diamond received a bonus in shares worth 1.8 million pounds last year. Barclays said no one would get a cash bonus of more than 65,000 pounds. A more detailed look at the results show that the bank’s adjusted pretax profit of 5.6 billion pounds fell short of the consensus forecast of 5.8 billion pounds. After initially opening lower, Barclays shares in London were trading 2.9 percent higher after an hour of trading. Richard Hunter, analyst at Hargreaves Lansdown Stockbrokers, said the initial sell-off appeared to respond to the disappointing top line results and that the upturn fed on more positive news within the earnings report. Hunter noted a 48 percent gain in pretax profit in the retail and business banking, a return to profit in the corporate division, a 9 percent hike in the dividend to 6 pence and a “sturdy” Tier 1 capital ratio of 11 percent. Barclays shares are now at their highest level since July. A year ago they were trading at about 330 pence but fell as low as 139 pence in September.

Read the full article →

David Kiley: The Great Debate Over Chrysler’s Super Bowl Ad

February 10, 2012

When I saw Chrysler’s Super Bowl ad at halftime on Feb. 5, I emailed the executive who conceived it, Chrysler marketing chief Olivier Francois, and told him I didn’t like it so much. It was my first viewing of the ad, and thus my initial reaction from the gut. I thought it was too dark. Unlike last year’s Eminem Super Bowl ad, I thought it didn’t do enough to lift Detroit or Chrysler — and wasn’t that the point? But after watching the video perhaps 10 times since that initial viewing, I have warmed to the ad, and recognized that my initial reaction seems to be in the minority. I’ve also come to think my response was tainted by all the election year claptrap and hogwash I watch and listen to on cable TV and satellite radio on a daily basis. Driven by the sharp reactions to the ad communicated via Twitter and in post-game interviews from political pundits and power-brokers like GOP fundraiser and former Bush Administration official Karl Rove , the media seized on the fact that the ad seemed to feature working-class folks from a Midwestern industrial town and the ad copy seemed to be right out of an Obama campaign speechwriter’s notebook, extolling the virtues of the auto industry bailout. The charge that Chrysler was somehow sending an early Valentine to the Obama campaign as thanks for the 44th president green-lighting the federal bailout of Chrysler in 2009 started to take shape on the airwaves. I initially thought the ad was a clever piece of marketing Jiu Jitsu, designed to create maximum buzz and chatter for the Chrysler after the game. Casting well-known Republican libertarian-cum-bailout criticizer Clint Eastwood was supposed to inoculate Chrysler from the pro-Obama charge. How could it be, I asked myself, that all these smart people at Chrysler and the ad agency Wieden & Kennedy had no clue their commercial would be seen through a political lens, especially just a couple weeks before the Michigan GOP primary? Even the line, “It’s Halftime in America,” made me think immediately of Ronald Reagan’s “Its Morning Again in America” spot — and that it’s coming up to “halftime in the Obama two-term presidency.” Francois says a possible political interpretation of the ad never come up in conversations during the two months of its development. He also says “creating buzz and chatter was never even part of the consideration.” Should we believe this very clever, intelligent, French-born executive heading both Fiat and Chrysler’s global marketing? No buzz intended? Olivier says the ad’s aim was to offer a logical sequel to last year’s Eminem ad, which ushered in the “Imported From Detroit” tagline as a slogan for the Chrysler brand. That line, repeated in this year’s ad, is now being used as an umbrella theme for all the company’s brands, including Dodge, Jeep, Ram and Mopar. “We are trying to shine a light on the values we hold in Detroit, values that we are trying to embrace for Chrysler and the values we think our customers identify with,” Francois said. “I know I am French and come from an Italian company, but I feel very much like I am gaining cultural citizenship in America, if not legal citizenship. And our team, which is led by Sergio Marchionne, is very serious about communicating what we think is great about this place and these people to the rest of the country.” Francois said Marchionne, the Fiat and Chrysler CEO, was intimately involved in the creation of this year’s ad, right down to writing and editing copy. Chrysler brand marketing chief Saad Shehab also had a hand in its writing and editing. And Clint Eastwood also had a lot to do with shaping the ad, choosing locations and writing copy. Eastwood was surprised Republican critics and Obama supporters felt that the ad was “pro-Obama.” But Eastwood’s spoken lines tee up, like it or not, an inevitable political discussion that will take place this month in advance of the Michigan GOP primary and into the fall, especially if Michigan native Mitt Romney goes on to face off against President Obama in the general election. Was the bailout the right thing to do? Was it money well spent? Was it fair to industries and companies that did not get bailed out? Was it too generous to the unions? The key lines: “[The people of Detroit] almost lost everything. But we all pulled together. Now, the Motor City is fighting again … but after those trials, we all rallied around what was right, and acted as one, because that’s what we do. We find a way through tough times. And if we can’t find a way, then we make one … how do we come from behind … how do we come together, and how do we win … it’s halftime, America, and our second half is about to begin.” The vast majority of Republicans, including all the current presidential candidates, were against the government-assisted bailout of General Motors and Chrysler. They believed the companies should have been allowed to go into bankruptcy court without aid from Uncle Sam, so that creditors could just pick over the companies, buy or be granted what they thought was valuable — Chevy, Jeep, Ram truck, Cadillac, real estate, etc. — and liquidate the rest. But amid the meltdown of the financial sector, there was no financing for an organized bankruptcy that would have allowed the companies to come out as whole at the end of the process, meaning it would have been a liquidation free-for-all. And as private equity companies usually do, there would have been a fire-sale of assets, followed by an inevitable move to get as much headcount and production out of Michigan and into Southern states and Mexico — as far away from the stronghold of the United Auto Workers as possible. The reason Southeast Michigan is clawing its way back is because hiring is happening. GM is the biggest automaker in the world again, and making billions. Chrysler is in the black and posting solid progress. Ford is making billions. Suppliers are bouncing back financially. The companies did not close or move away. GM and Chrysler have made substantial investments in the city and surrounding suburbs. Communities are still fighting to get back to par, but they haven’t been destroyed. The sentiments and words in Chrysler’s ad reflect the way the automaker’s executives and Eastwood feel about the values they find in the working people who design, engineer, market and sell the vehicles produced by the company. Their words also seem to support the idea that high-value manufacturing, such as automobiles, is an important industry to protect and nurture in the U.S. Those values and thoughts also happen to be shared by Obama’s administration, and they are a cornerstone of his campaign rhetoric and prose as president. It all seems to be a right-cross to the jaws of the GOP presidential candidates and the establishment conservatives who both opposed the auto bailout and regularly express disdain for the UAW. All on the biggest TV day of the year with over 100 million people watching. So it’s not difficult for many people to think the content and timing of Chrysler’s commercial could have been planned and calculated to maximize buzz, the currency on which most successful ads trade these days (no matter what Francois says he was looking for). The Chrysler executives and Eastwood say these political themes some of us think we saw were not in their minds or conversations. They sought to make an ad, they say, that simply touched and engaged everyone, not one party or another. Late Thursday, four days after the game, there were 5.8 million YouTube views of the ad. A cursory patrol of comments left by real people — not pundits or members of the media — shows those of us in the media are, indeed, in the minority of those who found it possibly pro-Democrat or pro-Obama. We won’t see the ad on TV again, says Olivier. Unlike last year’s Eminem ad, it won’t be shown in shorter versions for normal ad break. It was meant as a one-time-only event. My guess is that it will be remembered and talked about for at least a few days more. Then the YouTube hits will slow down, and we will move on to other topics. But the ad — intentionally or not — meshes well with the Obama message for the Midwest and especially Michigan. So it wouldn’t surprise me if we see the ad pointed to by the president and Democrats for months to come as a reminder of the grit, determination and values of Detroiters and Southeast Michiganders — and of just who kept the Michigan economy from falling of a cliff.

Read the full article →

Massachusetts AG: Mortgage Settlement Is Only The Beginning

February 10, 2012

The $25 billion settlement with five of the nation’s largest banks over charges of widespread mortgage fraud, announced Thursday, isn’t the end for Massachusetts. Massachusetts Attorney General Martha Coakley said at a press conference Thursday that she plans to pursue further relief for homeowners. “We believe there is still much work to do,” said Coakley, who was one of the more outspoken attorneys general during the settlement negotiations. “This is only five banks … We have Fannie and Freddie. We have 19 other lenders.” Coakley said that the settlement will not prevent her from pursuing further criminal probes against lenders, in order to help homeowners who have been “caught in the unlawful and unnecessary foreclosure machine.” Coakley already has sued Goldman Sachs , Morgan Stanley , and Countrywide , wresting hundreds of millions of dollars from banks for Massachusetts and homeowners in the process. “What we are looking to do is prevent unnecessary foreclosures,” Coakley said. “That is our mission for now: to do investigations where there is criminal activity.” The U.S. government reached the $25 billion settlement with Bank of America, Citigroup, JPMorgan Chase, Ally and Wells Fargo over improper foreclosures on homeowners without proper documentation. The settlement will not prevent more government lawsuits against banks in the future. In total, the settlement is the largest multi-state agreement since the nationwide tobacco settlements in 1998 . Forty-nine states are to receive a piece of a $5 billion cash payout as part of the deal. Only Oklahoma did not agree to the settlement. Massachusetts was one of the four states that most actively resisted a settlement with the banks. California, New York, Delaware and Massachusetts all announced their cut of the nationwide deal on Thursday, saying they would receive relatively large cash awards. Coakley said that Massachusetts will receive $318 million from the mortgage settlement, as well as an extra $46 million to ensure that the banks in the settlement actually pursue loan modifications for underwater and delinquent borrowers. Massachusetts families who lost their homes to foreclosure between 2008 and 2010 also will receive cash payments of up to $2,000 because of the sheer disorderliness of the foreclosure process, she said. “It will provide for people who have been victimized, really, by the lack of willingness or ability of the banks to work with families even when it would be commercially reasonable for them to do so,” she said. Coakley said the settlement was an important step in providing relief for borrowers and justice after “the corruption of the land court system” through the Mortgage Electronic Registration Systems, which many banks used as a substitute for organized paperwork for borrowers. “Rather than wait for two more years … we wanted to get started on this, and we’re hopeful that this will provide real relief,” she said. “There is so much blame to go around. We needed to get some remedies in place.”

Read the full article →

Guess Which Local University Shattered Fundraising Records?

February 10, 2012

SAN FRANCISCO — Stanford University’s latest five-year fundraising drive netted $6.2 billion, the largest amount ever raised in a higher education campaign, school officials said Wednesday. Money from the Stanford Challenge is being used to fund an interdisciplinary approach to teaching and research on areas such as education, environment, human health and international affairs, officials said. “We’ve undertaken a new model in higher education, with experts from different fields joining together,” school president John Hennessy said in a statement. “This kind of collaboration has enabled Stanford to assume a larger role in addressing global problems.” The money is providing funding for more than 160 endowed faculty positions, 360 graduate student fellowships, the construction or renovation of 38 campus buildings, $27 million in seed grants for innovative research and more than $250 million for need-based undergraduate scholarships. The $6.2 billion raised by the Stanford Challenge is the most collected by a university in a single fundraising campaign, said spokeswoman Lisa Lapin, citing the Council for Advancement and Support of Education. That total surpasses the $4.3 billion goal set when the campaign was launched in October 2006. During the campaign that ended Dec. 31, the university received donations from more than 166,000 alumni, parents and community members. The university received contributions of more than $50 million from Stanford alumni such as Yahoo Inc. co-founder Jerry Yang, Nike Inc. co-founder Phil Knight and Silicon Valley venture capitalist Robert King. Stanford is the latest university to announce a successful multibillion fundraising campaign. Last year, Yale University said it had raised $3.9 billion, and the University of Pennsylvania said it collected $3.5 billion. “It’s an impressive drive for funds that most public universities can only dream to eventually match,” said John Aubrey Douglass, a researcher at the Center for Studies in Higher Education at the University of California, Berkeley. “Donors are attracted to the big-name universities, but I worry some that the rich keep getting richer.”

Read the full article →

Google’s $12.5 Billion Deal Expected To Be Approved

February 9, 2012

By Diane Bartz WASHINGTON (Reuters) – The Justice Department will approve Google’s $12.5 billion bid to acquire Motorola Mobility Holdings Inc, according to sources close to the antitrust review. The department is also expected to approve an Apple-led consortium’s bid to acquire a group of patents from bankrupt Canadian company Nortel Networks. Both deals are expected to be cleared early next week. Google, whose Android software is the top operating system for Internet-enabled smart phones, announced in August it planned to acquire phone-maker Motorola Mobility. The deal will give Google one of the mobile phone industry’s largest patent libraries, as well as hardware manufacturing operations that will allow Google to develop its own line of smart phones. The Apple-led consortium, which includes RIM, Microsoft, EMC, Ericsson and Sony, had agreed in July pay $4.5 billion for 6,000 patents and patent applications that telecom-equipment maker Nortel had put up for sale, including coveted 4G wireless technologies. The companies joined forces to outbid Google for the patents. Google, the world’s No. 1 search engine, has been under increasing regulatory scrutiny. The U.S. Federal Trade Commission and the European Union are both investigating Google’s business practices. The company faces accusations it uses its clout in the search market to beat rivals as it moves into related businesses. The Justice Department will likely continue monitoring patent litigation in the telecom space, according to the sources. The department of Justice, Google, and Apple did not immediately respond to requests for comment. (Reporting By Diane Bartz; Editing by Tim Dobbyn)

Read the full article →

Huge Scandal Rattles San Francisco-Based Snack Company

February 9, 2012

SAN FRANCISCO — Diamond Foods Inc. is replacing its CEO and chief financial officer after an internal investigation found that the company improperly accounted for payments to walnut growers and it needs to restate two years of financial results. The news, announced late Wednesday, sent shares of the San Francisco-based company plummeting more than 43 percent in after-hours trading. Diamond Foods, which makes Emerald Nuts and Pop Secret popcorn, has been embroiled in a dispute over the payments for several months. The company said that its audit committee found that the payments were booked in the wrong period. The payments – an estimated $20 million in 2010 and $60 million in 2011 – skewed the company’s financial results. Diamond Foods placed its CEO Michael Mendes and Chief Financial Officer Steven Neil on administrative leave. The company is looking for permanent replacements. In the meantime, it appointed Rick Wolford, a Diamond Foods director and former CEO of Del Monte Foods, as its acting CEO. Michael Murphy, of Alix Parners, will serve as acting chief financial officer. The deal could put Diamond Foods’ plans to acquire the Pringles brand from Procter & Gamble Co. in jeopardy. The deal, worth $1.5 billion when it was announced in April, would be the biggest acquisition ever for Diamond Foods and make it the second-largest snack maker in the nation behind PepsiCo Inc. The collapse of Diamond Foods’ shares also hurts its ability to finance the deal. Cincinnati-based P&G called the news from Diamond Foods “very disappointing.” It said in a statement that it is evaluating its next steps and keeping all its options open. “Pringles remains a valuable asset and it has attracted considerable interest from other outside parties,” P&G said. Shares of Diamond Foods were halted in trading earlier in the day but fell $15.88 to $20.78 in after-hours trading. Its shares have been on a downward slide since hitting $96.13 in late September. Diamond Foods said it takes the integrity of its financial statements seriously and is working to complete the restatements as soon as possible.

Read the full article →

GOP Crafts Plan To Kill Obama Birth Control Rule

February 9, 2012

WASHINGTON — The Obama administration’s rule requiring most employers’ insurance plans to pay for birth control with no co-pay for employees has infuriated conservatives at the annual Conservative Political Action Conference, renewing the calls for repealing health care reform. Rep. Steve King (R-Iowa) told The Huffington Post that Congress needs to try to reverse Obama’s decision, which has caused a firestorm among many conservatives because religiously affiliated groups are not exempt from the rule. King suggested killing it by attaching a measure to a piece of must-pass legislation, such as the upcoming Surface Transportation Bill. “If the president vetoes it, then we’re back to square one,” he said. “So if it goes on a piece of must-pass legislation like maybe a Surface Transportation Bill, there’s a chance that the president will sign a bill like that. I’m going to let others push on that strategy — Surface Transportation Bill or some other must-pass piece of legislation.” The new rule stems from the Affordable Care Act. Most women employed in the U.S. will have the cost of their birth control covered with no co-pay , effective Aug. 1. The rule exempted employers, including churches and other places of worship whose primary purpose is imparting religious beliefs. But many religious groups argued it was too narrow and should apply to religious-affiliated organizations as well. The Obama administration disagreed, but gave these employers an extra year to comply with the new law. Ultimately, King added, Congress needs to push for the repeal of health care reform, where the new rule originated. “This is the president’s decision, made by Kathleen Sebelius,” said King, referring to the secretary of Health and Human Services. “This decision was not made at HHS. It was made in the White House. Barack Obama made this decision or approved this decision and the way to rectify it is to repeal Obamacare.” WATCH: Sen. Marco Rubio (R-Fla.) has already put forward a bill that would allow religiously affiliated hospitals, universities and other organizations that morally oppose contraception to refuse to cover it for their employees. He said no decision has been made on the timing of bringing legislation to the floor. Asked if he sees any middle ground with the White House, he proposed letting individual churches choose whether to pay for contraception for their employees. In the House, Speaker John Boehner (R-Ohio) said the House Energy and Commerce Committee is taking the lead “through appropriate legislative channels.” The Senate’s $109 billion Surface Transportation Bill moved to the floor on Thursday. It reauthorizes federal public transportation programs at current levels for two more fiscal years. The broader House bill would cover five years of transportation spending. The House GOP leadership has planned on a Feb. 17 vote . UPDATE — 7:54 p.m.: The Huffington Post’s Mike McAuliff reports that Senate Republicans did end up going with the strategy King mentioned, offering an amendment to the transportation bill aimed at countering birth control regulations under the health care law. They attempted to block the rule before it even took effect by amending the Surface Transportation Bill that the Senate had voted 85 to 11 to start debating. Senate Majority Leader Harry Reid (D-Nev.) took umbrage at the move, saying, “Here is a bipartisan bill to create and save jobs. Every state in the union is desperate for these dollars. But to show how the Republicans never lose an opportunity to mess up a good piece of legislation, listen to this: They’re talking about First Amendment rights, the Constitution.”

Read the full article →

SEC May Target Big Banks In Lawsuit Over Mortgage-Backed Securities

February 9, 2012

Regulators may be preparing a lawsuit against some of the country’s largest banks in order to probe their role in the acceleration of the financial crisis. The Securities and Exchange Commission is planning to formally warn a number of firms that sold mortgage-backed securities in the years leading up to the meltdown of an impending enforcement action, the Wall Street Journal reports. At issue is whether banks knew at the time that the mortgages backing their securities were of poor quality — and whether the banks nevertheless presented a picture of the loans that was misleadingly reassuring. Mortgage-backed securities are generally believed to have played a central role in the near-meltdown of the national banking system a few years ago. The country’s largest financial firms repeatedly bundled subprime mortgages and used them to guarantee securities that were sold to investors. When those mortgages proved unsound, it triggered a series of financial failures that dealt a severe blow to the national economy. If such a lawsuit does come to pass, it would be part of a broader effort on the part of the federal government to assign responsibility for the financial crisis — and to better regulate hazardous trading practices and high-risk financial instruments in the hopes of preventing another one. At the same time, the SEC has been criticized for not doing more to stamp out misconduct. In 2009, one prominent whistleblower called the agency ” captive to the industry it regulates .” Multiple lawsuits and inquiries have already raised the issue of whether banks misrepresented the health of mortgage-backed securities during the housing boom. JPMorgan Chase faced one such suit last year, as did Washington Mutual and Bank of America’s Merrill Lynch division . Goldman Sachs is currently facing a potential class-action suit from investors over whether it purchased a number of mortgage-backed securities in 2005 without first examining their health. Goldman was also accused last year, by an investigatory Senate panel, of misleading Congress and investors as to the safety of the mortgage-backed securities it was selling. News of the possible suit comes at a moment when banks are already being called to account for their handling of another result of the collapsing housing market: the foreclosure crisis. On Thursday, the government announced that it had reached a $25 billion settlement with some of the country’s largest financial firms — among them Citigroup, Ally and BofA, all said to be targets of the SEC investigation — over charges that the banks engaged in systematic and widespread mortgage fraud. No major bank executives have yet to face prison over their role in the worse financial crisis since the Great Depression.

Read the full article →

U.S. Bans Health Insurance Company Fine Print, Allows Baffling Terms

February 9, 2012

The Obama administration aims to demystify shopping for health insurance and has created a standard form that explains in plain language without the fine print what plans actually cover. What they couldn’t do was make health insurance itself less complicated, so consumers will still be confronted by baffling terms including “allowed amount,” “balance billing,” and “usual, customary, and reasonable charges.” The health reform law requires insurance companies to use a new document that presents a uniform summary of deductibles, co-payments and other features so consumers can compare one health plan to another. The new rules also eliminate the fine print: insurers can’t use a typeface smaller than 12 points. Administration officials including Health and Human Services Secretary Kathleen Sebelius unveiled the forms Thursday and companies will have to comply beginning Sept. 23. Consumer groups including Families USA and Health Care for America Now praised the policy as an important step that enhances transparency in the health insurance market. These new summaries of benefits and costs will help people choose the right health plans and are a big improvement over the confusing information and marketing material insurance companies currently use, said Lynn Quincy, a senior policy analyst at Consumers Union who helped develop the new form. The “plain language” isn’t always so plain and the jargon-heavy nature of the form underscores that health insurance is complicated. While the administration will require that insurers provide a four-page glossary of industry terms , shoppers will have to contend with terminology that isn’t always easily understandable. “We don’t want to over-promise here about what a form can do laid over top a very complex product,” Quincy said. “We have to wait and see if the new form actually helps people.” The insurance summary can’t be longer than eight pages and includes facts about a plan such as what its deductibles are, whether benefits are capped at a certain dollar amount every year, and if patients need referrals to visit specialists. Though the administration proposed last year that premiums be listed, that requirement isn’t part of the final rule. The monthly price for a health plan, which may not be available until after an insurance company has reviewed a customer’s application, will be provided separately. The form includes examples of medical expenses, such as the birth of a child, so consumers can estimate how much would be covered by insurance and how much would come out of their own pockets. The administration characterizes this feature as a “Nutrition Facts” label for health benefits. The health insurance industry’s top lobbyist said the rule places too heavy a burden on companies and takes effect too quickly. “The final rule requires an almost complete overhaul and redesign of how information must be provided to consumers,” Karen Ignagni, president and CEO of America’s Health Insurance Plans, said in a statement .

Read the full article →

The Greenest Car Of 2012 Is…

February 9, 2012

From Mother Nature Networks’ Melissa Hincha-Ownby: The American Council for an Energy-Efficient Economy (ACEEE) has published its 14th annual Greenest Cars List and for the first time an electric vehicle takes the number one spot. The new Mitsubishi i-MIEV bested the Honda Civic Natural Gas , which held the number one spot for eight straight years. A variety of environmental criteria are assessed when evaluating a vehicle’s green score, including the emissions created by the power plant used to provide electricity to the i-MIEV and other electric vehicles . The changing face of the eco-friendly automotive scene actually led to a few changes in the ACEEE’s methodology this year. “This year, a number of updates were made to the Green Book® methodology to more accurately estimate vehicles’ environmental impacts. These include improved emissions estimates for the vehicle manufacturing process, changes reflecting current natural gas extraction practices, and consideration of upcoming shifts in the generation mix for the electricity used to power electric cars.” Source: ACEEE One very prominent electrified vehicle is missing from this list, the Chevy Volt . According to CNNMoney.com , “That’s because the ACEEE uses vehicle weight as a criterion for scoring, under the assumption that a heavier vehicle causes more waste in production.” Unfortunately for General Motors, the Chevy Volt was their best chance for inclusion on the list. Instead, the Greenest Cars of 2012 list is dominated by Japanese imports. General Motors and other Detroit-based automakers are receiving unfavorable recognition on the Greenest List’s companion, the Meanest Vehicles for the Environment in 2012 . Both the Chevrolet G3500 Express Cargo van and its GMC cousin, the G3500 Savana tied with the Ford E-350 Wagon for the Meanest Vehicle of 2012 with a Green Score of 17. For those that cry foul, there are electric cargo vans on the market that are a viable alternative to these gas-hogging beasts. The 2012 Greenest List and each vehicle’s corresponding Green Score follows:

Read the full article →

Janet Murguía: Why the AG Settlement is Good for Communities of Color

February 9, 2012

This is a joint blog post with Marc Morial, President and CEO, National Urban League Today, state Attorneys General (AG) announced that they arrived at a $25 billion agreement with mortgage servicers in response to the “robosigning” scandal that broke 18 months ago. When New York AG Eric Schneiderman, California AG Kamala Harris, or Nevada AG Catherine Masto signed onto the agreement for their hardest hit states, it was a clear indication that this is a strong settlement for our families. We at the National Urban League (NUL) and National Council of La Raza (NCLR) celebrate this significant move as one in a series of enforcement steps that are essential to restoring the public’s faith in our housing system. The closure of these proceedings is incredibly important to healing our families and neighborhoods. The entire nation has felt the burden of the enduring foreclosure crisis. Black and Hispanic homeowners have been especially hard hit. One in four Black and Hispanic borrowers in the U.S. lost homes or are at serious risk of losing their homes, more than half the number of White borrowers. Asian, Black, and Hispanic families were 1.7, 3, and 2.2 (respectively) times as likely as White borrowers to receive subprime loans even after accounting for similar credit profiles. Through foreclosures, our families have battled substantial wealth loss, emotional distress, and an uncertain financial future. The AG settlement will bring relief to our families, with approximately $17 billion dedicated to principal reductions. Writing down principal has proven to be a win for both borrower and lender alike, especially when compared with the costs of foreclosure, property maintenance, and a sheriff’s sale for pennies on the dollar. Up until this point, however, servicers have not made it a priority. This settlement and a recent announcement to increase incentives for principal reductions should compel servicers to help families and clear the logjam on write-downs. Also, we are confident that rapid uptake of these new resources will soon generate the empirical information needed to convince naysayers that write-downs are vital to stabilizing the market. We are encouraged by the AG settlement and plan to do everything we can to ensure that affected families have access to these new resources. Finding homeowners is no small endeavor, especially finding those who have slipped through the cracks. Outreach will be an enormous undertaking in its own right and NUL and NCLR hope to deploy their housing programs to seek out eligible clients. Despite the challenges, we believe this AG settlement will set families up for success and will bring true accountability and systemic improvement to our housing market.

Read the full article →

Morty Lefkoe: Do You Have a Fear of Public Speaking?

February 9, 2012

If you fear public speaking more than going to the dentist, or even death, you are not alone. This fear is so common that surveys indicate that over 50 percent of the adult population of the United States experiences fear when speaking in public. As Jerry Seinfield put it quite accurately on one of his shows: Most people would rather be in the casket than delivering the eulogy. We have had a number of clients whose fear of speaking in pubic was so great that they turned down promotions rather than take a job that required them to speak in public on a regular basis. The saddest call we ever had was from a man who called to say his daughter had just announced to him that she was about to get married… and this news made him petrified. Why? Because he realized he was going to have to make a toast at the wedding. Interestingly enough, there is nothing inherently scary about talking to a few people who are there to hear what you have to say. And why does merely having to introduce oneself at a meeting lead many people to go to the bathroom just before it is their turn. What makes speaking in public so common and so frightful? If you’ve been reading my regular blog posts, you won’t be surprised to learn that my answer is: beliefs. In fact, after helping over 3,000 people eliminate this problem, we’ve discovered the specific beliefs that cause this fear. Let me tell you what they are and why they result in this widespread fear. Here are the beliefs that cause a fear of public speaking in most people: • Mistakes and failure are bad. • If I make a mistake or fail I’ll be rejected. • I’m not good enough. • I’m not capable. • I’m not competent. • What I have to say is not important. • People aren’t interested in what I have to say. • I’m not important. • What makes me good enough and important is having people think well of me. • Change is difficult. • Public speaking is inherently scary. To make it real that these beliefs could cause such terror in so many people, ask yourself this question: Imagine someone, whom you don’t know, who really had all the beliefs I listed above. Do you think she would be afraid to speak in public? In fact, wouldn’t you be willing to wager that she would have public speaking anxiety? Why these beliefs cause a fear of speaking in public I think most people would agree that anyone with these beliefs would fear public speaking. And here’s why: A belief is nothing more than a statement about reality that we feel is true. And if we think it is true that it is bad to make mistakes and if we do we’ll be rejected, and if our sense of importance is dependent on others thinking well of us — then we would have to be terrified when we stand up to speak in front of others because we could make a mistake, leading to rejection, and because we would feel less important if people thought less of us. But you might be thinking: I am afraid to speak in public but I don’t agree with most of these beliefs. Here’s a strange thing about beliefs: It is possible to intellectually disagree with a belief we hold. In other words, early in life we might have concluded as a result of interactions with our parents that it’s bad to make a mistake (because mom and dad got upset when we didn’t live up to their expectations). Now, today, we might realize that innovation is possible only if we are willing to try new things that might not work out. Mistakes are part of the process of doing something new and different. So we “know” that it’s okay to make mistakes and learn from them. But merely knowing that does not get rid of beliefs. If fear is not inherent in public speaking and if the fear is caused by specific beliefs, then eliminating the beliefs will eliminate the fear. Not reduce it or make it easier to deal with. Eliminate it. Research proves eliminating beliefs eliminates public speaking fear A study conducted by the University of Arizona several years ago determined that if the beliefs listed above (and a few conditionings) were eliminated, the mean level of fear of the subjects studied fell from 7 to 1.5 on a scale of 1-10, one being no fear whatsoever and 10 being terror. To prove this to yourself, get rid of three of the 11 beliefs that cause a fear of public speaking (and a bunch of other unpleasant feelings) by using a free belief-elimination process at http://recreateyourlife.com/free . Your fear of speaking in public is not due to “human nature.” You can rid yourself of that terrifying prospect once and for all.

Read the full article →

National Mortgage Settlement All But Inevitable As California, New York Join Deal

February 9, 2012

New York Attorney General Eric Schneiderman and California Attorney General Kamala Harris are joining the national mortgage servicing settlement, making a deal that includes all 50 states all but inevitable, according to a source who spoke Wednesday evening on condition of anonymity. “It’s hard to see any state staying out of the deal if California is in,” said the source. The settlement resolves allegations that five of the nation’s largest banks forged documents and wrongfully foreclosed on borrowers in what has come to be known as the “robo-signing” scandal. Schneiderman and Harris have been outspoken in urging the Obama administration to hold the nation’s biggest banks accountable for their role in the housing crisis and have resisted signing on to the settlement until now over concerns that it would go too easy on the banks and provide too little homeowner relief. The two states’ participation had widely been seen as necessary to a successful deal. California has been one of the hardest hit states during the foreclosure crisis, and because of this was considered a key state when it came to securing a deal. The five banks participating in the settlement — Ally Financial, Citigroup, Bank of America, Wells Fargo and JP Morgan Chase — agreed to contribute a total of $25 billion to help struggling homeowners if California joined the deal. Without California, that figure would drop to $19 billion. The deal is being negotiated between the state attorneys general, the Obama administration and the banks. The majority of the settlement money is earmarked for helping homeowners change the terms of a mortgage or refinance it, or reduce the amount of principal owed. In this election year, the proposed deal has become a political lighting rod as some consumer advocates have criticized the Obama administration for what they perceive as terms that deliver too little help to desperate homeowners. “Even if the final settlement number is $25 billion, it pales in comparison to the scope of the problem,” said Margery Golant, a Florida-based attorney who represents homeowners and formerly served as assistant general counsel at subprime mortgage giant Ocwen Financial. “If you do the math, that’s a few hundred million per state. That’s not enough to change anything.” California and New York are joining more than 40 states that already have agreed to the settlement. Florida, Massachusetts, Nevada and Delaware have remained resistant to joining, though that will likely change now with California’s and New York’s participation, sources familiar with the negotiations said. Shaun Donovan, secretary of the Department of Housing and Urban Development, said last week that a deal “will be finalized, I would expect, in the coming days.” A final deal has not been announced.

Read the full article →

Clay Farris Naff: Jesus Concerned About The Poor? You Must Be Joking, Says The Christian Right

February 8, 2012

When President Obama used the occasion of the National Prayer Breakfast to say that for the fortunate to pay a little more to help the less fortunate “coincides” with Jesus’ teachings, he must have touched a nerve. How else to explain the volcanic eruption of hate that has spewed from the right in response? Exposure to the pyroclastic flow of rightwing political lava for more than a moment can cause severe brain tissue burns, so I’ll offer a few quick samples. Geoff Ross, a retired naval man and self-styled president of the Rogue Patriot Group, writes: I am correcting the record, Sir. You [are] a degenerate immoral hack that has no values or moral fiber or glue. … It is not your job to give Americans a fair shot at anything. It is up to us Americans to be able to go out and find prosperity and happiness and financial independence. It is you sir with your BOOT on the neck of this nations carotid artery that is shutting off blood flow to freedom and liberty we used to enjoy. When you remove your boot then we will prosper. … You stated Mr. President “Living by the principle that we are our brother’s keeper. Caring for the poor and those in need. These values are old. They can be found in many denominations and many faiths, among many believers and among many non-believers. And they are values that have always made this country great.” You make this statement yet you remove millions of dollars in federal aid from Catholic charities because they refuse to bow down to your demand that they send rape victims for mandatory abortions… Mandatory abortions? I guess they must have been authorized by the Obamacare Death Panels when we weren’t looking. Now, you might be tempted to dismiss the above drivel as just typical Internet raving. But that would be a mistake. For the fanatics of Old Time Religion, this is mainstream stuff. Here’s Fox News regular Steven Crowder: OK, you might say, this guy with his “Obama’s Burning Taxpayer-Funded Incense To Whatever Pagan, Foreign Deity He’s Worshiping” nonsense is just another attention-seeking rightwing rent-a-ranter. But it doesn’t stop there. On the floor of the Senate, Orrin Hatch of Utah took up the cudgels to berate the president about the Gospels. Short version: Hatch blasts the president for injecting a “tax-the-rich scheme” into the prayer breakfast, says the Gospels are concerned about “weightier matters,” and cautions him to remember that only one person ever walked on water. Apparently, in today’s GOP to even mention making a little financial sacrifice to help the poor is to compare yourself to the messiah. See for yourself. Why are the reactions so venomous? The answer, I think, lies in an asymmetry of belief. For mainstream believers across the political spectrum, religion is an important but limited dimension of their lives. It fosters altruism, a sense of community and a reassurance of meaning in their lives. The hotheads of the Christian Right have a completely different orientation to religion. Forget about charity, mercy or love. As far as they are concerned if Jesus said, “Blessed are the poor,” he must have meant in the afterlife. As they see it, this life is all about war. Theirs is a tribal god who bears a remarkable resemblance to the angry, vengeful and often merciless Yahweh of old. The defenders of Old Time Religion see themselves in an existential fight to the finish with Satanic enemies. And clearly they believe that Satan’s plan is to tax them into hell. It is a worldview strangely detached from the Gospels. Otherwise, you might think that when President Obama says , “if I’m willing to give something up as somebody who’s been extraordinarily blessed, and give up some of the tax breaks that I enjoy, I actually think that’s going to make economic sense. But for me as a Christian, it also coincides with Jesus’s teaching that ‘for unto whom much is given, much shall be required,’” it might ring true. But then again, maybe that would come uncomfortably close to reminding them of something else Jesus is quoted as saying, in the Gospel of Matthew: …for I was hungry, and ye gave me to eat; I was thirsty, and ye gave me drink; I was a stranger, and ye took me in … Verily I say unto you, Inasmuch as ye did it unto one of these my brethren, even these least, ye did it unto me. Or this: “…sell your possessions and give to the poor, and you will have treasure in heaven. Then come, follow me.” Or, worst of all, this: “Verily I say unto you, It is hard for a rich man to enter into the kingdom of heaven. And again I say unto you, It is easier for a camel to go through a needle’s eye, than for a rich man to enter into the kingdom of God.” No, that will never do. Better book some TV preacher on Fox News to explain it all away.

Read the full article →

House Dems: Drilling Fines Are ‘Pocket Change’ For Oil & Gas Companies

February 8, 2012

WASHINGTON (AP) — Federal policing of oil and natural gas drilling on public lands is lax and inconsistent, with only 6 percent of violations resulting in monetary fines over 13 years, House Democrats said in a report Wednesday. Fines over that time totaled less than $275,000, an amount that the Democratic staff of the House Natural Resources Committee characterized as little more than “pocket change” for oil and gas companies. The report said federal regulators issued no fines in the period studied, February 1998 to February 2011, in eight of the drilling states. The report, obtained by The Associated Press before its public release later Wednesday, said the government does little to ensure accountability or protect the environment, even as drilling on federal land has increased in recent years. The increase is driven in part by hydraulic fracturing, or “fracking,” a drilling technique that has allowed companies to extract oil and gas long locked underground. The report focuses on drilling activity that occurred on federal land in 17 states during three administrations, two Democratic and one Republican. A total of 2,025 citations for safety and drilling violations were issued to 335 companies, the report said, with 64 companies fined a total of $273,875 “It would be an overstatement to even call these fines a slap on the wrist. For oil and gas companies making billions from drilling on America’s public lands, this kind of inadequate oversight and enforcement is little more than a pin prick,” said Massachusetts Rep. Edward Markey, the committee’s top Democrat. Markey and Rep. Rush Holt, D-N.J., requested the report. “American citizens and workers should feel confident that oil and gas companies are conducting business in the safest manner possible, and when they don’t, that the U.S. government will step in and make sure they pay the price for their actions. This report indicates that confidence in the oversight of drilling on public lands should be limited, at best,” Markey said. The Obama administration is considering new rules for fracking at oil and gas wells on federal land. President Barack Obama said in his State of the Union speech last month that the Interior Department will require energy companies to publicly disclose chemicals used in drilling for natural gas on public lands. Federal rules for fracking on public lands are set to be released in a few weeks. Adam Fetcher, a spokesman for Interior Secretary Ken Salazar, said the department received the report Wednesday and will review it. At Obama’s direction, Interior is taking additional steps to ensure that domestic energy resources are developed safely and responsibly, “including measures to enhance public confidence in hydraulic fracturing on public lands, Fetcher said, referring to the new fracking rules expected in a few weeks. “It is essential that the public have full confidence that the right safety and environmental protections are in place,” Fetcher said. Officials said several large penalties have been assessed recently against drilling companies, including a $2.1 million civil settlement last year with Denver-based Berry Petroleum Co., after an employee disabled production gauges that could have affected royalty payments on more than 150 Utah oil wells. In fracking, millions of gallons of water, sand and chemicals are pumped into wells to break up underground rock formations, allowing oil and gas to escape. Energy companies have greatly expanded their use of fracking as they tap previously unreachable shale deposits, including the lucrative Marcellus Shale formation in Pennsylvania, New York and neighboring states. The drilling practice has also attracted increased attention from Congress and regulators, as private groups and government agencies research whether it poses a danger to drinking water. The report found that more than 2,000 violations were handed out by the Interior Department to oil and gas companies drilling on federal land. Of these, 549, or 27 percent, were classified by committee staff as a major environmental or safety violation. More than half the major violations stemmed from a nonfunctioning or missing blowout preventer, the same device that failed in the BP oil spill in the Gulf of Mexico, the report said. A total of 113 major violations cited inadequate well-casing or cementing, another problem that occurred in the BP spill. Onshore, well-casing and cementing are a key defense against groundwater contamination. On at least 54 occasions, oil and gas companies began drilling on federal land before receiving formal approval to do so, the report said. Despite those problems, monetary fines were rarely issued, the report said. In eight states — Alaska, Arkansas, Louisiana, North Dakota, Nevada, Ohio, South Dakota and West Virginia — no fines were issued for the period studied. Thirteen companies were cited for at least 30 violations over the period studied, topped by Oklahoma-based Williams Production RMT Co., which received 98 citations and seven fines totaling $6,000. Colorado-based Encana Oil & Gas Inc. received 63 citations and four fines totaling $11,000, while Texas-based Anadarko E & P Co. received 61 violations and one fine totaling $5,000. ___ Online: House Natural Resources Committee: http://naturalresources.house.gov/ ___ Follow Matthew Daly: Twitter.com/MatthewDalyWDC

Read the full article →

Reid Hits Back Against GOP Measure Targeting Marginalized Group

February 8, 2012

By ANDREW TAYLOR, THE ASSOCIATED PRESS WASHINGTON — Republicans are looking to deny child tax credits to undocumented immigrants–refund checks averaging $1,800–in an effort that has roused anger among Hispanics and some Democratic lawmakers. The proposal, which would require people who claim the federal credit to have Social Security numbers to prove they’re legal workers, is being offered as a way to help pay for extending the Social Security tax cut for most American wage-earners. It would trim federal spending by about $10 billion over a decade. Senate Majority Leader Harry Reid of Nevada says the proposal unfairly goes after the children of poor Hispanic workers. Such kids often are U.S. citizens, even when their parents aren’t, because they were born in this country. Says Leticia Miranda, senior policy adviser of the National Council of La Raza: “People who are making close to the minimum wage and are raising children in this country – and we’re asking them to pay for the payroll tax cut?” She says, “It’s outrageous and it’s crazy.” On the other side, Republicans and some Democrats say what’s crazy is even having a debate over whether the government should be cutting checks to people who have sneaked into the country without documents. It’s hard to imagine there isn’t a healthy majority, even in the Democratic-controlled Senate, to stop the practice – if it’s actually brought to a vote. “We have rules about tax credits and benefits, and it seems to me they need to be applied fairly and across the board,” said Democrat Sen. Claire McCaskill, who is facing a difficult re-election bid in Missouri. “If there are rules, they need to be enforced. I think it’s just that simple. I don’t think it’s complicated.” Undocumented immigrants have been barred from other refundable tax credits, such as the earned income tax credit for lower-income workers. But a 1997 law enacting the child tax credit doesn’t specifically exclude them from collecting that separate benefit. It was significantly expanded in 2001 and 2009 so that many more people are eligible for refundable credits, though the expanded credit is slated to expire at the end of the year along with other Bush-era tax cuts. “Although the law prohibits aliens residing without authorization in the United States from receiving most federal public benefits, an increasing number of these individuals are filing tax returns claiming this refundable credit,” Rep. Sam Johnson, R-Texas, said when the House debated the payroll tax cut measure in December. “Illegal immigrants bilked $4.2 billion from the U.S. taxpayers (in 2010). I think that it’s time that we fixed it.” The situation has Democrats in a box. If they fight the GOP effort to cut back payments of the tax credit, they’ll be favoring the delivery of refunds to people who not only don’t owe income taxes but aren’t supposed to be in the country in the first place. What’s more, closing the loophole would raise real money – an estimated $10 billion over 10 years under the approach favored by House Republicans. The Treasury Department says that in the 2010 filing year more than $4 billion in child credit refunds went to 2.3 million people who filed tax returns but didn’t have Social Security numbers proving they were citizens or legal workers. That’s a four-fold increase over five years earlier. On the other side are politically influential Hispanic groups, a key Democratic-friendly constituency. Opponents of tightening eligibility for the child tax credit point out that six of every seven affected families are Hispanic, with an average household income of about $21,000. Tax credits averaging $1,800 per family make a huge difference at such income levels. Hispanics point out that in many instances the tax credit goes to wokers who aren’t citizens but whose children are – because they’ve been born in the country and therefore can have Social Security numbers of their own. They say such children should reap the benefit of the tax credit just like other children in comparable economic circumstances. “I just think the child tax credit is working just fine and there’s no need to punish children,” Sen. Reid said last week. “We’re supposed to try to be helping them.” One option under consideration is to require tax filers to supply a Social Security number for the child when claiming the tax credit instead of requiring that at least one of the parents possess one. That would respond to criticism that the GOP proposal is unfair to the citizen children of undocumented immigrants. “We’re not in favor of fraudulent payments or payments that shouldn’t be made, but we don’t want to create obstacles to supporting low-income families who are trying to care for their children,” said Sen. Dick Durbin, D-Ill. “Even though the parent doesn’t have a Social Security number, they could still be entitled under their tax return, for a child tax credit.” Congress needs to find about $160 billion between now and the end of the month to cover the costs of extending through Dec. 31 a Social Security tax cut averaging about $20 a week for 160 million workers, federal unemployment benefits for the long-term jobless and unreduced Medicare fees for doctors. All are now due to expire Feb. 29.

Read the full article →

The Big Price Of Somali Piracy

February 8, 2012

Though many first think of Johnny Depp when pirating come up, avoiding the real-life bandits of the sea is are multi-billion dollar problem for the shipping industry. Somali pirates cost various governments and the shipping industry up to $6.9 billion last year, according to the One Earth Future Foundation , a non-profit advocacy group. Piracy off the coast of Somalia is both lucrative and common due to its location near the Gulf of Aden, an oil shipping lane that sees about 20 percent of global trade, according to Bloomberg . As a result, the cost to the shipping industry of Somali piracy alone accounts for over half of the total $9 billion in extra costs each year, according to recent figures from the Indian National Shipowners Organization . In 2011, Somali hijackings actually fell 36 percent from the year before, the Financial Times reports . Still, Somali pirates cost the shipping industry billions. Shipping companies pay about $2.7 billion in additional fuel costs to speed up ships in particularly high-danger areas. One Earth Future Foundation reports that no vessel has been hijacked when travelling 18 knots — or about 20 miles per hour — or faster . There may be have been fewer hijackings last year, but piracy in the poverty-stricken west-African nation are still making headlines. Somali pirates have recently shifted tactics to kidnapping people on land , such as travel and surfing journalist Michael Scott Moore, who was kidnapped in northern Somalia last month . However, the tactic may be ill-advised. At about the same time as Moore’s capture, Navy SEAL team 6, the same squad responsible for the Osama Bin Laden’s death , rescued an American woman and Dutch man during a raid that resulted in deaths of eight of their captors. Still, employees working on oil tankers and cargo ships remain at substantial risk, so much so that employers pay an additoinal $195 million each year to compensate them for taking on the danger. Shipping industry workers also endure a variety of other dangers on the job. In addition to the risk of running aground — a danger that the workers on the New Zealand cargo ship Rena know all too well — workers also face the possibility of exploding shipping containers.

Read the full article →

Dan Solin: Your Broker Has No Clue

February 8, 2012

I am fascinated by the way most people invest, because it is demonstrably wrong. Here’s how you probably pick your mutual funds. Your broker calls and tells you about a mutual fund he believes is right for your portfolio. The pitch usually involves a discussion of the stellar past performance of the fund. He encourages you to sell funds that have underperformed and buy ones with better performance. The process repeats endlessly. You fall for it every time. Does this make sense? In a thoughtful blog, Brad Steiman, a vice president of Dimensional Fund Advisors, discusses the many problems with this approach. Recent performance can be misleading Steiman notes that a few years of outperformance may not be indicative of skill. The fund manager could just be lucky. For example, a fund that had an average “alpha” (positive return above its benchmark) and a standard deviation (measurement of volatility) of 6%, would require a track record of 36 years before you could be 95% certain the fund manager was skillful and not just lucky. A 6% standard deviation of alpha is representative in the Morningstar data of actively managed US equity mutual funds. Just for fun, ask your broker this question the next time he recommends a mutual fund: How long a track record would I need in order to determine if the performance of the fund manager was evidence of skill? He won’t know the answer, but the blank look will be worth your effort. Finding the needle in the haystack may not be enough Let’s assume you have a terrific broker who has a modest understanding of statistics. The broker tells you he has found a fund manager with a long enough track record to indicate skill and not luck. Should you buy that fund? Probably not. According to Steiman, one out of 40 managers is expected to meet this criteria based on luck. He concludes that even with this impressive track record, “[T]here is still a 2.5% probability the outperformance was due to good luck, and the true alpha of the manager is zero.” The Fund Manager’s Skill May Not Persist It gets worse. Even with a statistically impressive past performance, Steiman notes that “…winners do not continue to win, and even when there is alpha in the extremes, it does not persist.” You can’t expect your broker to understand how to evaluate statistical data. They are salesmen (and women). But you can — and should — educate yourself with a basic understanding of how to determine whether the next “hot” fund manager shows evidence of skill or is the latest false prophet hyped by the financial media and the securities industry. I agree with Steiman. You need to get off “the manager selection merry-go round”. Dan Solin is a senior vice president of Index Funds Advisors. He is the New York Times bestselling author of The Smartest Investment Book You’ll Ever Read, The Smartest 401(k) Book You’ll Ever Read, The Smartest Retirement Book You’ll Ever Read and The Smartest Portfolio You’ll Ever Own. His new book, The Smartest Money Book You’ll Ever Read, was published December 27, 2011.The views set forth in this blog are the opinions of the author alone and may not represent the views of any firm or entity with whom he is affiliated. The data, information, and content on this blog are for information, education, and non-commercial purposes only. Returns from index funds do not represent the performance of any investment advisory firm. The information on this blog does not involve the rendering of personalized investment advice and is limited to the dissemination of opinions on investing. No reader should construe these opinions as an offer of advisory services. Readers who require investment advice should retain the services of a competent investment professional. The information on this blog is not an offer to buy or sell, or a solicitation of any offer to buy or sell any securities or class of securities mentioned herein. Furthermore, the information on this blog should not be construed as an offer of advisory services. Please note that the author does not recommend specific securities nor is he responsible for comments made by persons posting on this blog.

Read the full article →

Banks Paying Homeowners To Sell Houses, Avoid Foreclosure

February 7, 2012

Some struggling homeowners are getting paid by banks to sell their houses and stave off foreclosure. Many banks, including JPMorgan Chase, are offering delinquent borrowers as much as $35,000 to sell their houses for less than they owe on them, Bloomberg reports. Some banks are finding the transactions to be more cost-effective and efficient than the complex and multi-stage foreclosure process. The attempt to clear the deluge of delinquent properties awaiting foreclosure echos others, including so-called “cash for keys” programs in which banks pay homeowners and renters to vacate their homes without an eviction. Banks have had to get creative in dealing with a massive foreclosure pileup that confronts them. Overall, foreclosure filings fell dramatically last year in large part because banks were hesitant to rush the process , after investigations into robo-signing practices, which sped up foreclosures, indicated abuse. The foreclosure process now takes nearly triple the amount of time that it did in 2007 , according to LPS Applied Analytics. The extended time period for foreclosures means that millions of properties are sitting in the pipeline and weighing on home values. Homes that are in foreclosure drive down property values twice as much as vacant properties , according to an October study by the Cleveland Federal Reserve. The Justice Department lent support to another means of avoiding foreclosure last month. The agency argued that foreclosure mediation — or the process whereby struggling homeowners can negotiate with lenders so they don’t lose their homes — is worthy of a government boost in research and possibly funding . Ben Bernanke also lent his two cents on how best to fix the housing market last month, when he published a paper saying that relying heavily on foreclosures to deal with delinquent borrowers is “costly” and “inefficient” for the housing market. Foreclosures “can result in ‘deadweight losses,’ or costs that do not benefit anyone, including the neglect and deterioration of properties that often sit vacant for months (or even years) and the associated negative effects on neighborhoods,” the paper said . Bernanke also floated some alternatives including combing a deed-in-lieu — or a program where homeowners return their house to lenders without going into foreclosure — with a rent-back agreement. The Home Affordable Modification Program, an aim touted by the Obama Administration in February 2009 as having the ability to help 3 to 4 million homeowners modify their loans and avoid foreclosure, has only netted nearly 1.8 million trial modifications for homeowners so far, according to a recent government report.

Read the full article →

Chrysler Super Bowl Ad Raises Questions About Underlying Political Message

February 7, 2012

On Monday, responding to a barrage of criticism from conservative pundits and some football fans, Chrysler chief executive Sergio Marchionne denied there had been any political message in the company’s Super Bowl aired during Sunday’s night’s halftime show. “It had zero political content,” Marchionne told a Detroit radio station . “It was not meant to be any type of a political overture on our part; we are as apolitical as you can make us.” The two-minute commercial starring Clint Eastwood compared Detroit’s comeback to the ongoing recovery of the American economy. Many viewers came away from Sunday’s ad thinking the two-minute spot was a pro-Obama ad; others did not. Yet at the Detroit auto show last month, it was clear that Marchionne felt indebted to the president for Chrysler’s very survival. “I owe the president a lot,” Marchionne said then. “The reason we are here is because he gave us the [bailout] money, right?” Marchionne was talking with a small group of reporters about Chrysler’s bid for $3.5 billion in loans from the Department of Energy, as part of a program created by Congress in 2007 to help automakers retool old plants to make fuel-efficient vehicles. The loans still hadn’t come through, despite consistent negotiating between Chrysler and the government. Marchionne said he hoped the process wasn’t being delayed for political reasons. His comment about the president, though, came in response to a reporter’s question, “Doesn’t Obama owe you one?” Nonetheless, knowing how carefully automakers ponder, weigh and debate official communications, it’s hard to imagine Chrysler’s top brass did not consider that its Super Bowl ad could be interpreted as a pro-Obama spot. Typically auto executives are very careful to not pick sides in political battles, for fear of alienating customers on any given side. Although they often have their own political agendas, such battles are waged with lobbyists and campaign donations, not overtly in political ads. A spokesman for Chrysler declined to comment further on the company’s commercial or Marchionne’s earlier comments. “The ad pretty clearly invokes the comeback due to the bailout, without mentioning those controversial words,” said Ted Brader, a University of Michigan political science professor. “And given that message — we made the most of the bailout and it was a success — I did think, Huh, one could read that as a tribute to Obama’s decision to bail out GM and Chrysler.” Brader said Chrysler’s commercial is vaguely similar to a 1984 political ad for Ronald Reagan, “It’s Morning Again in America.” This year’s Chrysler ad, which aired just moments after Madonna finished her halftime show, started with Eastwood’s telling the audience that it’s halftime and the football teams are in their locker rooms figuring out how they can win. “It’s halftime in America, too,” Eastwood said, as an image showed the sun rising over a misty mountain range. The commercial continued with scenes of people waking up, getting ready for the day. “People are out of work, and they’re hurting, and they’re all wondering what they’re going to do to make a comeback.” The people of Detroit, he said, have already faced that fear. They almost lost everything. But the country pulled together and “after those trials, we all rallied around what was right and acted as one,” he said. And now Detroit is back, Eastwood said. Reagan’s earlier ad also started with a sunrise, except the opening scene included a boat in a bay. Various vignettes depicted people commuting to work, moving into new homes and getting married, while a narrator talked about how much better life was in 1984 compared with in 1980, before Reagan took office. “Under the leadership of President Reagan, our country is prouder, and stronger, and better,” the narrator said. “Why would we ever want to return to where we were?” The wounds of the automakers’ collapse and subsequent bailout are still fresh in Detroit, where bewildered citizens looked on as the rest of the nation debated whether it was worthwhile to help save the industry. Michigan slipped into a recession four months before the rest of the country and suffered the hardest. Unemployment there was the highest in the nation for all of 2009, and people left the state looking for jobs. Michigan was the only state to shrink in population size from 2000 to 2010, losing 54,000 people, according to Census counts. But now things are starting to turn around. Ford and Chrysler both posted profits for 2011, and GM is expected to do the same. That’s the message Eastwood said he was hoping to tap into with the commercial, in a bipartisan fashion: “I think ” all politicians will agree with it,” he told Fox News. “I thought the spirit was OK.” The commercial was vague enough to give Chrysler “plausible deniability about any political implication of the ad,” Brader said. Eastwood was a good choice (although, according to the Wall Street Journal , he may have been the second choice; Al Pacino also shot a version of the ad) because people connect him with hardscrabble Westerns and tough, flawed heroes. Eastwood’s background as a Republican who opposed the bailout (but favors gay marriage) makes the message even less clear. “So, all in all, the whole thing is rather nicely ambiguous,” Brader said. Watch Sunday’s Chrysler ad and the 1984 Reagan ad below:

Read the full article →

Liz Ryan: How to Help a Hiring Manager Remember You After the Interview

February 7, 2012

“My gosh, Liz,” said my friend Kortney, “I’m six feet off the ground.” “What’s the story, Kort?” I asked, and she said “I just came from the greatest job interview ever. The manager and I really connected. He loved my thinking and vice versa. It was like interview nirvana.” “This is magnificent news!” I said. “Let’s write a thank-you letter right now. We want to imprint a huge KORTNEY message in this guy’s mind.” “Imprint?” she asked. “This manager and I are tight. We solved half the world’s problems in a two-hour interview. I’m sure I’m getting the job.” Kortney waited a week and heard nothing. She started to get antsy. On the 10th day after her interview — the conversation she had left with the boss’ words “I can’t wait to talk again” ringing in her ears — she called the guy. He picked up the phone. She told me later, “I got the worst feeling in the pit of my stomach as we talked and I realized he had no idea who I was.” There’s a happy ending — Kortney got back on track with the manager, and is moving through the process now. The incident jarred her into a realization she’d always understood deep down, but hadn’t thought about consciously before: namely, the realization that people are goldfish. Their minds are like steel traps sometimes, and like sieves the rest of the time. The same guy who spent a rapt two hours with Kortney completely forgot her name, her story, and her amazing problem-solving skills just a few days later. Let’s be easy on the guy: he had plenty of other fish to fry. Undoubtedly, he left the interview thinking Kortney was a terrific candidate, but the next day he met someone else, and then someone else after that. Too much data in too little time creates overload conditions, and when that happens, all bets are off. I’m looking at a hoodie right now. It’s draped over the back of my chair. I bought it last year at Target, for my eight-year-old. There’s absolutely nothing wrong with it; it’s a standard kid’s hoodie. I remember when I bought it. My 17-year-old daughter was with me. “Look at that hoodie,” I said to her that day. “Your brother would love that.” Target had just brought in some new Spring merchandise, and my son’s hoodie on the rack looked like something I couldn’t live without. The colors were bright, and different from the colors in the store at my last visit — Target had changed its lineup of Spring fashions. What fun! A year later, it looks like just another hoodie to me. “Mom, you are truly invertebrate,” scolded my daughter. “Look! Shiny colors! All Target has to do is put some bright-colored thing on the rack, and my mom throws it into her cart.” “Don’t hate,” I said, and snapped up some irresistible chili-red bath towels. People are limbic nerves wrapped in frontal-lobe’s clothing, and the sooner we realize it, the better. That hiring manager didn’t make a conscious decision to wipe all traces of Kortney’s existence from his mind. He just forgot. If we realize that the people who meet us and even brainstorm with us in the fast-paced interview pipeline are all but certain to forget us shockingly quickly, we won’t get affronted when the inevitable failure-of-recollection takes place. We can build it into our planning. It’s no big deal to be forgotten, as long as you’re ready for it and can adjust accordingly. It happens to all of us. I found one of my dearest summer-camp-mates on Facebook, and sent her a friend request. “Did we go to camp together?” she asked in reply. She couldn’t remember me. We slept in the same cabin with six other girls for five years running. My name is the same as it was then. That’s okay. I withdrew. A year from now, she’s likely to write “Say, did we go to camp together?” At times I struggle to put names to my own children, so how could I blame my old friend for a little memory lapse? In a job interview situation, we can’t assume that a great interview will lead to a job offer. We have to stay top-of-mind for a hiring manager. In a thank-you letter, the very first thing we must do is bring ourselves back to mind for the recipient. We do that by mentioning a specific conversation the two of us had (about model cars, or Beyonce’s baby, or who knows what). I’ve heard hiring managers confess “I just spent twenty minutes talking with a brilliant applicant, one of the four people I met last Friday. The whole time we talked, I was trying to remember which guy it was. He told me his name when he called, and I had his resume in front of me — but I couldn’t get the face back, or the guy in general. It was awful!” That unfortunate candidate spent twenty minutes on the phone, certain he was winning big points for his sparkling observations on the hiring manager’s issues. But he got no bounce from that pithy conversation, because the hiring manager couldn’t match the guy on the phone with the memory of a person he’d met the week before. It’s easy to overlook the fact that until the manager has you firmly back in mind (your face, your voice, and your back story) you can’t advance in the selection pipeline. You can’t even make points for brilliant observations on the telephone. Don’t take a hiring manager’s memory for granted. Keep your brand and story front and center in every interaction. Maybe the hiring manager made a comment about you at some point, or maybe you’ve noticed that he thinks of you in a certain way (“the ex-Navy guy” or “the guy with the supply chain background,” for instance). If so, use that. When you write to the hiring manager at any point in the selection process, start with “Dave Smith here — the Navy guy.” You’d be amazed how that quick descriptor cuts through the fog that plagues every overstressed hiring manager. Seeing yourself through another person’s eyes and helping the other person snap you back into focus isn’t just useful in job-hunting. It’s good training for lots of situations. As long as we’re living among goldfish disguised as humans, we may as well get used to communicating the way (or at least we’ve always imagined) our fishtank-dwelling fellow creatures do.

Read the full article →

Melissa Richer: How Millennials Are Shaping the Future of Social Entrepreneurship and Technology

February 7, 2012

In 2011, the terms ‘social entrepreneurship’ and ‘social business’ began to make weekly appearances in mainstream media (see recent Huffington Post coverage here , here , and here ). These startups are at the forefront of the ‘new economy.’ They make money by solving social and environmental problems, and they do not fit into the traditional nonprofit or for-profit mold. When I entered the workforce 5 years ago, I mostly heard that my generation was ‘difficult to work with,’ ‘savvy with that social media thing,’ and ‘free-spirited.’ Now people see us differently. In 2011, we were the entrepreneurs, survivors, and ‘ generation sell .’ Oftentimes people ask me about the future of social entrepreneurship. This is because I founded Ayllu , an organization that tracks social businesses in 80+ developing countries and reports on market trends. I tell them that right now social entrepreneurship is a hot trend and there are funders, conferences, university departments and newspaper sections devoted to it. I believe that in the not-too-distant future, social entrepreneurship will become so prevalent that it will no longer be a niche sector. It will simply be part of the new economy that emerges from today’s convalescent markets. In the years ahead, social entrepreneurs will take advantage of innovations in the technology sector. Here are technology-related trends that have major social change potential in 2012 and beyond: Crowd-based Models : Crowd-funding brings people together online, and pools their money to finance a project. It is a big social entrepreneurship trend, which Kiva made famous a few years ago. Now many social entrepreneurs have innovated on this concept. Solar Mosaic makes it possible for anyone to fund community solar installations in places like schools or hospitals. inVenture realized small businesses in developing countries need growth capital, so they created a crowd-investing platform. And One Percent Foundation innovated on the giving circle concept by pooling 1 percent of its members’ income and donating it to charities. In the future, as technology becomes cheaper and more prevalent, social entrepreneurs will move beyond crowd-funding. They will use other crowd-based models to create social change. This trend is already manifesting itself in the mobile technology space. Mobile Technology: Today, nearly 70 percent of people in developing countries have mobile phones. In just a few short years, more than 1 billion people who were formerly ‘off the map’ are on it. This market opportunity is tremendous in terms of size and scale, as are possibilities for social innovation. Social entrepreneurs are building new models: Labor Voices combats human trafficking with a ‘yelp model’ where migrant workers can rate and review their employers anonymously. In developing countries, Medic Mobile uses mobile technology to help rural health workers coordinate with clinics and patients. In Kenya, people use their cell phones like credit cards, and Kopo Kopo helps business owners accept mobile payments from customers. Health Technology: Healthcare is one of the most diverse areas for social entrepreneurship. Lumoback , a mobile healthcare startup, designed a smart phone-powered device that improves posture and chronic back pain. Embrace developed a low-cost baby incubator to save premature infants in the developing world. And BioSense created a device that tests pregnant women for anemia in rural India, and can save thousands of lives each year. These trends are part of the big data and collaborative consumption movements. With so much information at our fingertips, solutions are emerging to analyze and organize information (big data). And thanks to the Internet, online collaboration is creating new kinds of marketplaces (collaborative consumption). In the past 10 years, we humans have become dependent on technology and it’s difficult to navigate life without it. Sometimes it feels as if our devices are in control of us, and not vice versa. But, in the next 10 years technology will become ‘smarter.’ It will adapt to us and become more integrated with our daily activities. Millennials will play a large role in evolving technology to create social end environmental benefits. Social entrepreneurship is our way of addressing the immense global challenges we inherited (see here and here ). We will use it to shift the global economy in a positive direction.

Read the full article →

Journalist Recovers Video Of Arrest After Police Deleted It

February 7, 2012

A Miami journalist has recovered video of police officers arresting him after it was deleted from his camera. The man was covering a police effort to evict Occupy Miami protestors. He plans to file a complaint with the police department and with the United States Department of Justice.

Read the full article →

Consumer Borrowing Spree May Not Be Healthiest Economic Sign

February 7, 2012

Consumer credit posted a second straight eye-popping monthly gain in December, according to a new Fed report, which some are taking as a sign of a new surge in the economy. There are a couple of reasons to not get too excited just yet. First, the $19.3 billion jump in consumer credit in December was driven mainly by a $16.5 billion surge in “non-revolving” credit, which includes student and auto loans. “Revolving” credit, or credit cards, grew by a more modest $2.8 billion. To the extent that people are using credit cards and taking out auto loans more, that’s a positive sign for economic growth — although maybe not the healthiest growth. More on that later. But the biggest gain in “non-revolving” credit in December came from lending by the “federal government,” which is student lending. That grew by $8.8 billion. A surge in student lending is not always a wholly positive sign for the economy, warns IHS Global Insight U.S. economist Gregory Daco. “It may indicate people are finding it more difficult to finance their kids’ education,” Daco said in a phone interview. “That may not be such a good thing.” The number might also have been skewed by seasonal adjustment factors. December is not typically a big month for student lending, so some unusually large increase in borrowing in the month, for whatever reason, might have thrown the seasonal adjustment off and amplified the increase. These numbers are volatile and can be revised dramatically. Clearly, consumer credit is on the rebound. November posted another ridiculously huge jump in consumer credit — $20.4 billion. Together, November and December’s growth in credit was the biggest two-month increase since 2001. And November’s credit gain was more heavily weighted toward credit cards and auto loans, and so was a better sign of real consumer spending. Of course, we knew about that already, having seen a 2 percent gain in consumer spending in fourth-quarter GDP data released last month. Given the big skew toward student loans in December, it is still too early to declare that consumers are feeling so frisky about the recovery that they’re out racking up debt to finance spending sprees. It is also possible that they are using credit more because wages aren’t rising enough to allow them to pay for stuff they need without going into hock. In any event, we probably do not want another economic recovery driven by consumers going into hock. Given the lingering sting of the debt-fueled financial crisis, it seems unlikely we will get one soon. “Consumers are slowly returning to the use of credit, but it’s a very cautious return,” said Daco.

Read the full article →

Huge Shakeup At Yahoo

February 7, 2012

SUNNYVALE, Calif. — Yahoo Chairman Roy Bostock and three longtime board members are leaving the troubled Internet company. The shake-up announced Tuesday continues a drastic makeover of Yahoo’s leadership during the past month as the company tries to win back investors frustrated with years of broken turnaround promises. Yahoo Inc. ushered in a new era last month by hiring former PayPal executive Scott Thompson as its fourth CEO in less than five years. Then Yahoo co-founder Jerry Yang resigned from the board. Bostock is departing along with Vyomesh Joshi, Arthur Kern and Gary Wilson. Many Yahoo shareholders have been clamoring for Bostock to step down since the company balked a $47.5 billion takeover offer from Microsoft Corp. in 2008.

Read the full article →

Chrome For Android Finally Here … Sort Of

February 7, 2012

Google has released a long-awaited beta version of its Chrome web browser for Android-powered phones and tablets, but the software only works on devices running the latest version of Android. The test version of Google’s popular Internet browser was made available for download today in the Android Market . Notable features of the software include the capacity for tabbed browsing, the option to browse the web in “incognito mode,” accelerated page loading, and the ability to sync bookmarks and passwords between users’ other devices on which they use the Chrome browser. Unfortunately, the acceleration technology these features require means the browser is limited to the few Android mobile devices that currently use Ice Cream Sandwich, the latest version of the Android operating system. Those devices include the Galaxy Nexus, Nexus S and Asus Transformer Prime, Business Insider reports . But experts expect Google Chrome to dominate Android devices in the future as users upgrade their phones to ones capable of running the newest Android operating system. “Even in beta, it’s a compelling browser at least on the Galaxy Nexus I tried it on, and it’s and a much better match for Apple’s Safari on iOS,” Stephen Shankland wrote in a review of the software for CNET . “And eventually, its success is all but assured when it simply becomes what ships with Android.” Today’s beta release caps off a three-year effort on the part of Google engineers to converge Android and Chrome , the company’s two fastest growing products, according to Mercury News . Both products were launched at the end of 2008 and soon became favorites of many users and developers. Android is currently the world’s most popular mobile operating system, while Chrome recently shot past Mozilla Firefox to become the second most popular Web browser behind Microsoft’s Internet Explorer. Early feedback from users reviewing the software on Android Market has been largely positive, with the first 500 commenters giving the software an average rating of 4.3 stars out of five. Check out a slideshow of screenshots below: WATCH:

Read the full article →

Google Fiber Rollout Ready To Begin

February 7, 2012

It reportedly suffered a slight delay due to some disagreement with local officials over just how its thousands of miles of wires would be hung, but Google announced today that it’s finally ready to begin the rollout of its Google Fiber network in Kansas City, Kansas and Kansas City, Missouri.

Read the full article →

Qutenza, Chili Pepper Drug, Gets Mixed Review For Treating HIV-Related Pain

February 7, 2012

* FDA raises concerns of effectiveness of pain patch * NeurogesX seeks Qutenza approval for pain in HIV patients * US FDA panel to review proposed new use on Thursday * Shares fall 23 percent (Recasts first sentence with stock fall, adds details on approval process) WASHINGTON, Feb 7 (Reuters) – NeurogesX Inc’s pain treatment derived from chili peppers had only mixed success at treating pain in HIV patients, U.S. health regulators said on Tuesday, sending shares of the tiny company down 23 percent. NeurogesX won FDA approval in 2009 for its Qutenza patch as a treatment for pain related to shingles. The product’s active ingredient is a synthetic form of the agent that makes chili peppers hot, known as capsaicin. The company now hopes to get the nod to sell the product for peripheral neuropathic pain that afflicts as many as 40 percent of HIV sufferers. An FDA committee of outside experts will meet to discuss Qutenza’s use among HIV patients on Thursday. The FDA is expected to make a decision by March 7. On Tuesday, Food and Drug Administration reviewers said in a report that the Qutenza patch produced statistically significant pain reduction among people with HIV. But that success was due to a 90-minute application. FDA staff said company studies failed to demonstrate the efficacy of the 30-minute treatment the company proposed for use in treating HIV-related pain. Statistical concerns including a lack of evidence that the results can be repeated “have raised the question of whether evidence of substantial efficacy has been demonstrated for this proposed treatment regimen,” said Dr. Bob Rappaport, director of the FDA’s Division of Anesthesia, Analgesia and Addition Products. FDA staff said studies with HIV patients showed no new safety issues. European Union regulators have already approved Qutenza for controlling pain in nondiabetic adults including people with HIV. Shares in the San Mateo, California-based biopharmaceutical company were down more than 23 percent at 89 cents on Tuesday morning on the Nasdaq. The exchange has threatened to delist the stock unless it can be sustained at $1 a share or above between now and July 28. (Reporting By David Morgan; Editing by Gerald E. McCormick, Derek Caney and Matthew Lewis)

Read the full article →

Craig Aaron: When Whinosaurs Attack!

February 7, 2012

From the same people who brought you Fear Factor , Temptation Island and When Animals Attack! comes one of the most-shocking-but-true stories of hubris, greed and endless griping imaginable. This is a tale of the vastly powerful but sniveling giants who control your TV, dictate much of our political discourse and get rich doing it — all while evading even the most basic forms of public accountability. This isn’t just another reality show — it’s the reality of what’s airing on every local TV station. And as far as station owners and their lobbyists are concerned, their business is none of yours. Broadcasters have pocketed gazillions over the years while using the airwaves free of charge. In exchange, they’re supposed to serve the public interest with programming that reflects community needs. But the Federal Communications Commission’s modest attempts to hold broadcasters to their end of the bargain are being met by a teeth-gnashing, fire-breathing rhetoric… and pitiful mewling about how hard it is to use a computer. But like so many of the reality stars before them, these whiny media dinosaurs — or whinosaurs for short — have no shame. A Series of Rubes So what kind of onerous government inquisition has drawn the whinosaurs’ ire? Well, the FCC has asked broadcasters to put the “public files” every station is supposed to keep upon the Internet, so it’s easier for people to view them. While nearly every other industry has found electronic record-keeping to be a better way of doing business, broadcasters are desperately clinging to their dusty file cabinets. They’re actually claiming, in the year 2012, that putting this basic information online — in other words, PDF-ing a document and posting it to the Web — is far too laborious. Somehow, these broadcasters, who have managed to make pictures fly through the air and into your living room for 70 years, are still relying on paper records and perhaps abacuses. Their arguments basically boil down to: “Keep your newfangled Google machines out of our buildings.” It’s ridiculous. As a coalition of public interest groups recently wrote to the FCC: “Those broadcasters that continue to rely solely or primarily on handwritten documents and manual updating of political files would do well to reevaluate their business practices with an eye to joining the modern world.” Steve Waldman, the main author of last year’s exhaustive FCC report on the future of media, has been the leading voice in favor of the FCC’s proposals and against the whinosaurs. “The rest of the world has figured out ways to use the Internet to reduce workload and cost,” Waldman recently wrote on the Columbia Journalism Review website . “I’m not sure the broadcasters want to take the position that they will be the one industry that can’t possibly be expected to use the Internet to improve efficiency.” Back in the USSR The FCC is also pushing broadcasters to put records of political ad buys online — records the stations are already required to keep. This information is especially important in 2012, when broadcasters will rake in billions of dollars from election ads. So why not give the public a way to know who’s trying to influence them? As Waldman explains : “Putting that information online would allow the public and reporters to better understand the flow of money in political campaigns.” Yet according to Allbritton, the TV station owner and publisher of Politico , this is nothing less than the first step on the road to a “Soviet-style standardization of the way advertising should be sold as determined by the government.” Because the Ruskies are so renowned for their transparency efforts? All this hyperventilating and hyperbole is especially galling when it comes from organizations that are supposed to be practicing journalism. As 12 leaders of the nation’s top journalism schools wrote in a letter to the FCC: “Broadcast news organizations depend on, and consistently call for, robust open-record regimes for the institutions they cover; it seems hypocritical for broadcasters to oppose applying the same principle to themselves.” But hypocrisy is another telltale trait of the whinosaur. Get with the Program Lastly, the FCC is proposing that stations keep basic records on what kinds of programming they put on the air. Imagine the audacity in asking broadcasters, who have made money hand over fist from squatting on the public airwaves, to report back on how much news or locally originated programming they actually do. Yet according to the FCC filings of 48 state broadcast associations, the request for standardized reports “carries with it the high risk that the commission will find itself not just at the edge of a First Amendment cliff, but in a catastrophic plunge that intertwines the commission and its staff for the indefinite future in the journalistic news judgments of television stations nationwide.” Such claims are preposterous. The FCC has not proposed any quotas or programming requirements — all it is asking, in exchange for an exclusive and lucrative license, is for broadcasters to report back on what they are already doing. Maybe the broadcasters are just unwilling to face up to the disconnect between their consistent claims that they’re giving the audience what they want, and the conflicting reality that wherever you go the one thing people are sure to agree on is that their local news must be the worst in the country. Now is the time to tell the FCC to ignore all this whining and move forward with its common-sense plans to encourage transparency and accountability. The whinosaurs have a reputation as fierce lobbyists and are good at making a lot of noise. But the climate is changing. So whinosaurs be warned: You either evolve, or you go extinct.

Read the full article →

Obama Reverses Super PAC Opposition To ‘Counter The Weight’ Of GOP Money

February 7, 2012

WASHINGTON — President Barack Obama’s campaign is reconfiguring its approach to powerful super PACs, worried the president’s re-election prospects could be overwhelmed by conservative groups raising and spending unlimited amounts of money. The president’s advisers have signaled to donors that he will soften, for the time being, his long-standing opposition to the outside groups, in hopes of assisting their fundraising efforts and leveling the campaign finance field heading into the general election. Obama’s campaign staff will go so far as to appear at super PAC events — though they will not be explicitly raising money. The president will not attend those events, a source confirmed. The new posture is a reversal for the president, and one likely to trouble some in the progressive universe (see: Feingold, Russ). Obama was staunchly anti-outside money during his pre-White House political career, and first ran for the White House encouraging deep-pocketed Democrats to send checks only through his campaign. He wanted a consistently coordinated message and his advisers were willing to starve non-campaign organizations of cash in order to achieve it. When the Supreme Court issued its Citizens United opinion allowing the creation of super PACs, the president and his staff offered sharp denunciations. “I don’t think American elections should be bankrolled by America’s most powerful interests,” Obama said at the time. He called super PACs a “threat to our democracy.” Politics eventually collided with ideology. In 2010, a wave of conservative money helped Republicans re-take the House of Representatives. The president and his advisers have watched in some horror, meanwhile, as super PACs have helped Mitt Romney submarine challenger after challenger (most notably Newt Gingrich) during the Republican primary this year. The determination was made that they could not unilaterally disarm. As campaign manager Jim Messina said in a blog post late Monday: With so much at stake, we can’t allow for two sets of rules in this election whereby the Republican nominee is the beneficiary of unlimited spending and Democrats unilaterally disarm. Therefore, the campaign has decided to do what we can, consistent with the law, to support Priorities USA in its effort to counter the weight of the GOP Super PAC. We will do so only in the knowledge and with the expectation that all of its donations will be fully disclosed as required by law to the Federal Election Commission. Currently, two former Obama aides — Sean Sweeney and Bill Burton — run the most prominent Democratic super PAC, Priorities USA Action. But that group has been vastly outraised by its conservative counterparts. And the notion that it could bring in the $100 million once projected now seems quaint. Burton was quick to take advantage of the Monday evening news with a well-timed tweet . “As has become evident in the past month, the only enthusiasm in the Republican Party is among oil company billionaires and investment bankers on Wall Street looking to defeat President Obama,” Burton said in a statement. “We’re committed to providing a balance to Karl Rove and the Koch brothers, who have pledged more than half a billion dollars to their effort.” The Obama campaign itself has done fine with fundraising. But as recently as last week, top donors fretted that one well-financed GOP donor could level the playing field if he or she desired. “The money for the campaign side they will do fine, ultimately,” a party fundraiser told The Huffington Post. “I think the problem is on the super PAC side … If I were on the campaign, I would be waking up and saying this is a big f–ing problem, we are going to get buried by these super PACs. And our side, the Democratic side, is not on a level playing field here.”

Read the full article →

Chris Weigant: Romney’s "Very Poor" Choice of Words

February 7, 2012

I’m in this race because I care about Americans. I’m not concerned about the very poor — we have a safety net there. If it needs repair, I’ll fix it. I’m not concerned about the very rich — they’re doing just fine. I’m concerned about the very heart of America, the 90 to 95 percent of Americans who right now are struggling. … I’m not concerned about the very poor that have a safety net, but if it has holes in it, then I will repair it. — Mitt Romney , in an interview with CNN’s Soledad O’Brien Mitt Romney’s gaffe last week (reproduced in full, above) is going to wind up the “gaffe that keeps on giving” for Barack Obama and the Democrats in this election cycle. Because the more Romney’s comment is examined and dissected, the worse it looks for him. This could, in fact, be the defining moment for Mitt Romney as a national political presence. That phrase is often bandied about in politics, but I use it here in the full literal sense of “defining moment” — a point in time which absolutely cements an image in the public mind of who you are and what you stand for as a politician. The image, quite obviously, is not a good one for Romney. The statement caused an initial media frenzy, which almost exclusively focused on the sound bite — “I’m not concerned about the very poor” — which was being spliced into Democratic ads before the sun had even set. Even Newt Gingrich piled on that part of Romney’s statement, fulminating that anyone running for president should have the good sense to be concerned with all Americans (or at least say so in public , for Pete’s sake). This is Politics 101, folks, and the fact that it took Newt Gingrich to point it out to Romney was highly amusing to Lefties everywhere. Romney desperately tried to spin his statement, and wound up floundering : “You’ve got to take the whole sentence, all right, as opposed to saying — and then change it just a little bit, because then it sounds very different.” Um, well, that would be true of just about any political gaffe, wouldn’t it? If you got to go back and re-edit your own words in such a manner, then gaffes wouldn’t even exist. Unfortunately for Mitt, they do. Romney, of course, is going to complain loudly when the “not concerned about the very poor” soundbite is used against him in ads, but he simply has no leg to stand on when it comes to “context.” He has no credibility on the subject, and no moral high road to take. He has already, in this election, run an ad of Barack Obama saying: “If we keep talking about the economy, we’re going to lose.” What Obama said — with context — was actually the exact opposite : “Senator McCain’s campaign actually said, and I quote, if we keep talking about the economy, we’re going to lose.” Romney’s campaign, when the ad came out, defended its use , saying “We used that quote intentionally.” So good luck begging for context in political ads now, guys. Even more unfortunately for Mitt, the out-of-touch and elitist image this gaffe conjures up is exactly the image a lot of folks already had of Romney. He appears to many as the type of guy who has no idea who the “very poor” are, or how they live. The only way a guy like Mitt Romney interacts with poor people — when not actually on the campaign trail — is either in an employer/employee relationship (as with the domestic help in his multiple houses) or a patron/servant relationship (the valet parking his car, the busboy clearing his table, or perhaps a ski lift operator). Neither breeds any sort of real understanding of what it is like to occupy this rung of the social ladder in Mitt — or, for that matter, the fears many middle-class folks have of being one financial emergency away from a dive headfirst into that safety net. The man has lived in a bubble for almost his entire life — and it shows. But while most of the attention so far has been focused on the “out of touch” nature of Mitt’s “very poor” choice of words, the real damage to Mitt as a Republican candidate stems from how he attempted to explain what he really meant. Ignore the soundbite/gaffe part of Mitt’s statement, and things get even worse for him among his party’s base. Chalk this one up as a victory for the Occupy Wall Street movement, because all of a sudden the Republican Party as a whole was having a debate about their party’s poverty policies . In a million years, I never could have imagined that happening without the outside force of the Occupiers changing the frame of the nation’s political debate. Think about it: when is the last time any Republican used the word “poor” in any political speech? For the life of me, I certainly can’t remember it, unless it was some part of George W. Bush’s “compassionate conservatism” flim-flam that my subconscious has just completely blocked out. Which brings me to my main point — Mitt’s explanation for his bad soundbite was extraordinary because it used the framing of Democrats . Mitt is arguing his point on a field created and defended by Democrats — not the usual Republican language. This is stunning, because Republicans are normally so adept at speaking of just about any issue in their own private terminology. It’s also stunning because it is such a losing position for Romney to take. First, the language. Republicans never say “poor” (as I’ve already mentioned) much less “very poor.” As far as conservatives are concerned, poor people either (1) deserve what they get in life because of their own bad choices, (2) are lazy and cheating the system to get a free ride through life, or (3) are budding conservative heroes, because we all live in a Horatio Alger novel and just need to grasp strongly on those bootstraps and pull. But Mitt’s bigger error wasn’t saying “very poor,” it was in fact using the term “safety net” — over and over again. And then doubling down on his error, by promising to “fix the holes” in the safety net, if it “needs repair.” This is where Mitt’s playing ball on a Democratic field, and not just because it fits in so perfectly with the campaign Barack Obama is teeing up to run, either. Republicans, as a general rule, never speak of the “safety net” unless in seriously derisive terms. They prefer, instead, to speak of the “culture of dependence” or people who use “entitlements” (Marc A. Thiessen has a good example of this over at the Washington Post today, for reference, complete with reverent Ronald Reagan genuflections). The weakness for Romney is that his statement — ignoring the gaffe, and giving him all the context he wants us to consider — is absolutely laughable, on the face of it. This is what comes from playing on the opposition’s turf. Because Republicans today are all about “entitlement reform” — which means, stripped of its own spin, “less money for the safety net.” This basic disconnect cannot be reconciled with Romney’s statement, no matter how much context we add. It is necessary to commit an act of doublethink to even try. Romney is for Paul Ryan’s budget. The Ryan budget shrinks the safety net. So how, exactly, is Romney going to “fix” the safety net? How will making seniors pay an extra $6,000 a year for health insurance do that? How will cutting funds to Medicaid fix things? How is giving the ultra-wealthy (which you also say you’re “not concerned with”) another round of tax breaks going to fix the safety net, Mitt? Please explain, with figures and budget projections to back your claims up. Anytime you’re ready…. These are the questions some intrepid reporter needs to ask Mitt Romney, and soon. Because talking about the “safety net” was Mitt’s real “very poor” choice of words. You want to talk about the safety net, Mitt? OK, then let’s talk about the safety net — and your proposals to fix the holes in it. That would, indeed be a conversation worth having. And if the media doesn’t ask Mitt, I’m sure Obama eventually will — the first time they face each other in a debate.   Chris Weigant blogs at: Follow Chris on Twitter: @ChrisWeigant Become a fan of Chris on The Huffington Post  

Read the full article →

Two Occupy DC Activists Remain Jailed In McPherson Square Police Clash

February 7, 2012

WASHINGTON–Two members of Occupy DC will remain jailed until at least Thursday on charges they assaulted police officers during Saturday’s clash with police who razed a downtown encampment. A handful of others were arraigned on less serious charges that included failing to obey police and released. Charges were dropped against two. One person was arraigned down the street in U.S. District Court on a failing to obey police charge and released. Those arrested were rounded up early Saturday as U.S. Park Police razed activists’ months-long encampment at McPherson Square. Police raided nearby Freedom Plaza the next day, but left many tents in place. The moves, though anticipated by the Occupy activists, shocked them nevertheless as police arrived with a dump truck and protective hazmat suits. A D.C. Superior Court judge set a hearing for Thursday for the two charged with assaulting police officers and said they would remain jailed until then. One is Jeremiah Desausa, accused of throwing a Coke bottle that struck a police officer in the eye. Police said over the weekend that the activist had thrown a brick, but a court document described it as a soda bottle filled with liquid. About a dozen Occupy DC activists showed up to watch the arraignments, in a Superior Court basement. They included one legal observer as well as lawyer Ann Wilcox. Several took careful notes, some on newspaper. It was a contrast from McPherson Square. Instead of screaming Occupy chants, the activists had to obey the courtroom’s no-talking policy. Whispering was met with a courtroom minder’s stern warning and threat of eviction. It was a long afternoon. Those arrested face charges ranging from failure to obey an officer’s order to felonious assault of a police officer. One by one, they were brought into court in chains and cuffs, some in white jumpsuits. One appeared with his arm in a brace and sling; the activists said his arm was broken . Brian Eister, 25, who was charged with failure to obey, was one of the first released. He said he wanted to return to McPherson Square for some yoga exercise. Wade Simmons, 41, had been charged with making threats to a police officer. He denied wrongdoing and was released after being arraigned, pending his next court date. He was most upset over the judge granting a stay-away order, temporarily banning him from Freedom Plaza. “How long is this?” he asked the judge. She replied that he had to check with his lawyer. He had been camping with Occupy DC since Oct. 15. Michael Patterson , 21, an Iraq War veteran arraigned on a felony charge of assault on a police officer, said outside the courtroom that he “didn’t do anything.” Patterson said Occupy DC’s eviction did not matter. “The camp was just a tactic,” he explained. He had traveled from Anchorage, Alaska, to join to Occupy DC in early-October. Now, he can’t go near the place; he too got slapped with a stay-away order.

Read the full article →

Sarah O’Leary: The Race for the Exits: How Komen Can Stop the Exodus

February 6, 2012

Drastic action is imperative if Race for the Cure hopes to stave off a catastrophic implosion. Now that Susan G. Komen has reversed its decision to stop funding breast cancer screenings for Planned Parenthood, it must take drastic, meaningful and very public measures to win back the hearts and minds of supports, consumers and corporate sponsors. One “mea culpa” apology will not be enough to shore up sponsors or win back consumers’ loyalty. As anyone working for Komen can attest, surviving a traumatic event doesn’t mean you’re healed. It’s an even odds bet that Komen, will remain highly toxic to promotional partners and their target audiences for months and years to come if it doesn’t make substantive change and voice it to the public immediately. When using borrowed equity to sell products or services, marketers seek out the best fit for their brand and their consumers. Susan G. Komen Race for the Cure was the Cinderella story of all charitable efforts, arguably the most popular nonprofit in history. Yoplait, General Mills, American Airlines, Evian and a host of other big players partnered with Komen to lift their brands among a coveted audience, Shopper Moms. Those of us marketers around at the beginning remember the truly groundbreaking arrival of Susan G. Komen Race for the Cure. Komen, singlehandedly, changed how marketers felt about what was, historically, a verboten subject. Before Susan G. Komen, the vast majority of marketers thought pairing cancer with their products or services was brand suicide. Marketing agencies bold enough to suggest Komen tie-ins heard in more than one corporate conference room, “You want us to do WHAT? Tie candy in with BREAST CANCER? It’ll ruin our BRAND!” Then came Race for the Cure. Pink ribbons began to show up everywhere, on everything. And Shopper Moms LOVED it. They were buying up Komen related products in droves, and corporate sponsors reaped the rich rewards. Shopper Moms were passionate in their support of women’s health, and their actions taught many in marketing a crucial lesson. An association with Breast Cancer and Susan G. Komen Race for the Cure didn’t harm a brand, it could skyrocket it. Sadly, today is a completely different day for Komen. Marketers need to be beyond certain that the pink ribbon and Susan G. Komen logo will make shoppers want to buy a box of corn flakes rather than avoid or (marketing gods forbid) intentionally boycott it. With all of passion on both sides of the issue, Komen has a long, uncharted and potentially perilous road ahead of it. If you’re a member of Yoplait’s marketing department, for example, the logical step would be to sever the relationship with Susan G. Komen as it exists today in support of another worthy breast cancer charity. As a multi-million dollar brand trying to sell more yogurt, Yoplait simply can’t risk shopper backlash. Susan G. Komen cannot, unfortunately, turn back the hands of time and erase their grievous error in judgment. However, doing nothing past issuing an apology will permanently damage what almost three decades of painstaking efforts have established. Komen must shore up marketing and consumer support by ridding itself of those whose thinking got Komen into this mess in the first place. The current board, President, CEO, CMO and Director of Public Policy should resign, effectively immediately. By eliminating the leaders who approved the Planned Parenthood grant debacle, it will send a loud and clear message that the Komen women knew, loved and trusted is back in business. When outraged consumers no longer fault Komen for its incompetency, supporters will return and partnerships with Komen will be viable for corporate sponsors. If Komen continues with the old guard that got them in the mess in the first place, consumers and marketers will have no assurances that such an error in judgment won’t happen again. In addition to replacing the leadership at Komen, the organization should consider inviting a respected voice from the breast cancer-screening arena at Planned Parenthood to sit on the Race for the Cure board. Also, Komen would be smart to partner with the breast cancer screening area of Planned Parenthood on a share promotional effort. The two could execute a cooperative campaign with one of Komen’s corporate sponsors. “Support Breast Cancer Screenings for Women in Need,” benefiting Susan G. Komen and Planned Parenthood’s breast cancer screening initiatives, would help a) put the focus back where it belongs — on breast cancer and women’s health and b) show consumers and marketers that Komen is serious about change that’s devoid of politics. Even if Susan G. Komen implemented the suggestions herein, there would still be a massive amount of repair that must take place. Consumers’ loyalty is a fascinating in regard to its potential benefits and liabilities. If you meet consumers’ wants, needs and desires, they will stay true. If you forget who your audience is, even for a couple of days, it can take a brand like Susan G. Komen Race for the Cure generations to recover. The mission of Komen is simply too important to women to wait that long. Sarah O’Leary is a 25-year marketing veteran and author of Brandwashed: Why the Shopper Matters More Than What You’re Selling”.

Read the full article →

← Previous Entries