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CVPS Names Larry Reilly to Be Next President

February 17, 2011

RUTLAND, VT–(Marketwire – February 17, 2011) – Larry Reilly, former president of distribution companies at New England Electric System and executive vice president at National Grid, will be the next president and chief executive officer of Central Vermont Public Service ( NYSE : CV ).

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Phil Trupp: The Tipster Calls: Do You Take the Money and Run?

February 15, 2011

Your friend who works at ABC Company tells you that the company is about to be acquired for more than it’s worth by XYZ Company, and that the stock price of ABC is likely to double. You trust your friend’s tip because he’s an executive at ABC and he or she is doubling down on the buyout. Question: As a retail investor, what would you do based on your friend’s tip? Do you call your broker and buy up as much ABC as you can afford? Or do you betray your friend, contact the Securities and Exchange Commission and volunteer to be a wire-wearing whistle blower hoping to bag a big, fat reward? Like many Wall Street operators — especially if you’re a hedge fund manager — you have been given inside information, which translates into money and power. But now you’re faced with an ethical dilemma. You read the newspapers and financial blogs and you are well aware of two things: insider trading is illegal, and yet it is an often-used business model with a long and inglorious history. What exactly is insider trading? Basically, it is the practice of buying or selling stock or other assets by corporate officers, other insiders or ordinary investors on the basis of information that is not public and is supposed to remain confidential. Insiders can buy or sell stock based on information they report to the Securities and Exchange Commission, thus making the public aware of the good, bad or perhaps the ugly data on a company’s balance sheet. Reporting this information to the SEC presumably gives the average investor a break, a level playing field upon which to make informed decisions. Fair enough. But if you are a major player or a hedge fund magnet, giving ordinary investors a break isn’t your concern. To pull down those hefty hedge fund fees you need to offer an edge, and that edge often amounts to inside knowledge played close to the chest and out of public view. So if the “whales” of Wall Street constantly are in search of inside tips, despite the legal and ethical pitfalls, why shouldn’t you cash in on your friend’s possibly profitable tip? The February 13 edition of the Washington Post business section features a story by David S. Hilzenrath and Jea Lynn Yang headlined “The federal dragnet on Wall Street’s inside game” which explores the insider trading business model and the government’s all-out push to put a stop to it. Insider trading has grown in recent years, the reporters conclude. But is this a growing epidemic enhanced by digital technology and unique ways of tracing cons? Or has technology merely exposed a practice that has been at work for generations? My experience brings me down on the side of the latter. Wall Street is not the Land of the Fair Deal. Indeed, insider trading is a means of taking advantage of ordinary investors and making a killing in the dark. For example, those insiders privy to special, non-public knowledge can — and often do — sell investors stock that is teetering on the edge of the cliff. The insiders sell you on the upside while betting the farm on the inevitable collapse. For example, hedge fund billionaire John Paulson recently worked with Goldman Sachs to produce a derivative made up of bad mortgage loans. Paulson bet against this so-called Abacus package, knowing in advance that it was built to crash, while Goldman sold it to clients as a bullish move. Paulson made out big-time, as did Goldman, while unsuspecting investors took the fall. The Abacus scam made headlines in the wake of populist outrage directed at the 2008 market meltdown. It was a sexy example of greed and insiders feeding at the public trough. The Street shrugged it off. It was by all accounts business as usual. It now appears that the Obama Administration is determined to crack down on such insider deals. The Department of Justice (DOJ) is focusing on a wide circle of expert network firms which feed inside information to financial management companies, matching various company insiders to stock traders. Wall Street argues there’s nothing wrong with this practice, that it is part of due diligence. The trouble with this argument is that the public isn’t connected to the process and is often enough victimized by it. DOJ is now trolling for insiders willing to wear wires to help build cases against billionaire hedge funds and those who feed them insider information. If there is honor among thieves, DOJ is proving the opposite is true. If stock and bond traders can’t cash in using legal practices, they can always snitch and pick up whistle blower awards granted by regulators that are often equal to, and at times exceed, the bonuses given to top financial executives. So where do you come down on my initial question? Do you call DOJ or do you take your insider tip and run straight to your broker? Critics of insider trading say the “integrity” of the market depends on your answer. Yet these same critics are challenged to find — let alone protect — the integrity they are so eager to preserve.

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Simon Johnson: Derivatives Industry Report Collapses

February 15, 2011

The credibility of a major report commissioned by the “Derivative End Users Coalition” — run by big banks against implementing the Dodd-Frank reforms — just collapsed. As Andrew Ross Sorkin reports in the New York Times , the report has no meaningful substance — it is destroyed by the critique of Joe Stiglitz — and the consulting company (Keybridge Research) behind the report sought misleading credibility through falsely claiming affiliations with substantive academics. At the end of Sorkin’s article is a remarkable admission by Mr. Wescott, the president of Keybridge, conceding these facts: “When I told Mr. Wescott of Keybridge about Mr. Stiglitz’s comments, he replied that ‘the client had asked us’ to put the report together. ‘It was a hypothetical study.’” Mr. Wescott admits that it is a bogus study (“hypothetical”) that was “asked” for — and in exchange for a fee they delivered what was asked for, i.e., a report that has no basis in fact or credibility. (See also my points about the report’s lack of substance from yesterday. ) This is lobbying for favor on the basis of misrepresenting what is in the public’s interest. Nowhere in this Keybridge “study” or the Chamber’s press release or in any materials put out by the Coalition of Derivative End Users was any of this disclosed. The industry is making completely baseless claims — and must resort to this kind of hollow chicanery. This report is revealed as nothing other than a deliberate attempt to mislead the public and to fool people on Capitol Hill. Cross-posted from The Baseline Scenario .

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Scott Bittle and Jean Johnson: Fiscal Follies: Tackling the National Debt in 500 Words or Less

February 11, 2011

Since we write about public opinion and believe strongly in public engagement , we’ll be the first to admit that much of the public is woefully uninformed about the federal budget and the country’s choices for getting a handle on its mushrooming national debt. Most Americans know it’s a problem, and they want it fixed. After that, things get a lot hazier. Unfortunately, the country’s leadership has now frittered away much of the time we could have used to educate the American people on this issue. President Obama is submitting his proposed budget Monday , and Republicans are already putting out their counter-plans , but neither has really laid the groundwork with the public for the implications of the spending cuts or tax increases that are necessary if we really want to get our finances under control. Now we really need to get a move on, and the electorate is both unrealistic and cranky. So here goes. Here’s what Americans really need to know (in 500 words or less): We have to start now because this could get ugly really fast. In about 10 years, the federal debt will be as big as our entire economy –100 percent of GDP. We’ll be spending more on interest payments than on defense. Just cutting what people normally think of as “big government” won’t do it. In 2010, the deficit was about $1.3 trillion. Eliminating the Departments of Education, Energy, Agriculture, Transportation, HHS, and HUD entirely would save less than $300 billion . We would still have a trillion dollars worth of red ink. Income tax rates are lower now than they have been for most of the last four decades. In the 1970s, top tax rates were twice as high. We’ve extended current rates for two years while the economy improves. After that, they need to be on the table. Yes, Social Security and Medicare are part of it. In as little as 10 years, government auditors say that spending on Social Security, Medicare and Medicaid, plus interest on the debt, could suck up more than 90 cents out of every tax dollar. There would be almost no money for anything else. It’s time to stop the blame game. The federal budget has been in the red for 31 out of the last 35 years , and both President Bush and President Obama added trillions of dollars to the debt. There’s enough blame to go around. It’s finding solutions that matters. Don’t fall for the bogus Beltway debate over “tackling the budget” versus “focusing on the economy.” It’s a false choice. We have to do both, and we can decide on changes now that kick in once the economy improves. There are hundreds of different proposals that would help. The big choice for most of us is whether to go with one that focuses on cutting spending even in popular areas to keep taxes low, or one that preserves popular programs, but raises taxes instead. Nearly all reasonable plans include some of both. Be ready to compromise. To solve this problem, we’ll all have to live with something we don’t like. Refusing to compromise means more delay, and that’s the one thing we can’t afford. If we act quickly and responsibly, we can do this.

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Video: Crocker Says Mubarak Setting Terms for End of His Tenure

February 11, 2011

Feb. 11 (Bloomberg) — Ryan Crocker, former U.S. Ambassador to Iraq and current dean of the Bush School of Government and Public Service at Texas A&M University, discusses the outlook for Egypt after President Hosni Mubarak defied calls for his resignation. Crocker talks with Betty Liu on Bloomberg Television’s “In the Loop.” (Source: Bloomberg)

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Robert L. Cavnar: Responding to the Hydraulic Fracturing Issue

February 8, 2011

As we’ve discussed before, the practice of hydraulic fracturing to produce oil and gas has grown into a controversy being argued about in local townhalls all over the country all the way to the halls of Congress in Washington.

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ABN Newswire Announces New French, Thai and Portuguese Press Release Publishing Partnerships for Public Companies Seeking Investors

February 6, 2011

ABN Newswire Announces New French, Thai and Portuguese Press Release Publishing Partnerships for Public Companies Seeking Investors

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Max Fraad Wolff: Squeezed

January 24, 2011

As the holiday season slips into memory the public sector squeeze is on. We are into the shorter, colder days of winter. The American public sector is struggling through a long, cold season. Yes, the economy has made up some of the ground lost in 2008 and 2009. Yes, the recession has been declared officially over. The stock market has rallied and corporate profits have rebounded. State, local and federal government finances remain mired in pain. Cuts in services and employment are occurring and proposed across the country. Last year, total state and local employment declined by more than 400,000 jobs. An unusual number of Americans are dependent on state and local services and employees. Many millions are in poverty, seeking food assistance and qualified for emergency state and local aid. Government jobs are essential supports in many area economies. These jobs employ many victims of past labor market discrimination, offer a way up and out. State and local services are one of the few lines of defense that remain in our thoroughly tattered social safety net. The discussion of public sector workers lately focuses on the cost. This is vital and should be open to discussion. However, we tend to forget all that we rely on these millions to do. We have also developed a dangerous inclination to discuss state and local workers as an undifferentiated mass with new specific attributes or history. This is a serious mistake as so much is now at stake and so many services and contracts are on the line. Our 20 million state and local workers provide many vital services. These folks provide education, fire, police, clerical, court/legal and social services. Major coming battles are to be fought over which state and local jobs to cut. Who will be fired? What pensions/benefits will be cut? How many services will be cut? Who will go without? This will likely reach a fever pitch as the federal debt ceiling is reached in March/April and the state and local fiscal year ends in June. Sometimes pictures are worth 1,000 words. This also goes for graphs. Below is a sketch of state and local workers. Few of the recent discussion really ask how many state and local workers there are. What do these people do? What are the pay levels? Who are these people? Conversation is usually dominated by ideologically and politically inflected diatribe. How many state and local workers are out there? Figure 1. State and Local Employment Bureau of Labor Statistics CES Figure 1 makes clear that there are about 20 million state and local workers in America. There were 14.3 million local workers at the start of 2011 and 5.2 million state employees. There has been a steady rise in state and local employment over the last half century. Growth has not been particularly rapid over the last decade. Figure 2 speaks to relatively flat employment levels at the state and local levels in the new millennium. Growth in state and local employment has occurred as population has increased and past social movements have won expanded benefits. The very high cost of medical care and social problems associated with crime, drugs, lack of affordable housing have added to costs. Public education — at all levels — has also grown as a cost to state and local governments. Our massive networks of jails, parole officers, probation officers and prisons have grown rapidly. The relative strength of state and local employee unions in some areas has also contributed to employment growth. Most American communities rely on a host of state and local services as well as employments and incomes that flow directly and indirectly from state employment. In some communities these jobs and services produce and support much of the local middle class. Figure 2. BLS Data State and Local Government Employment 2000-2010 (Thousands) In 2009, the latest available data, the average state employee earned $23.67 per hour, $49,240 per year. The average local government employee earned $21.68 per hour or $45,090 per year. These averages hide large differences in pay by location, age and job type. The national average earning per hour for all employed Americans in December of 2009 was $22.38, $44,760 for a 2,000 hour year. State and local government employees earned about the national average per hour in 2009 and 2010. State and local workers, particularly in the six states with the highest levels of unionization, received better benefits than the average private sector worker in a similar job. Public sector workers are more likely to receive benefits than those in the private sector. Benefits have been negotiated up by these workers as an alternative to higher wages in many localities and cases. The value of benefit packages adjusts with the costs of health care, prescription drugs and returns on pension investments. Benefits in public sector work continue to be in line with historical middle class benefit levels. However, there has been significant erosion in benefits for many private sector workers since the 1980s. Thus, public sector workers often have more generous benefit packages than their private sector counterparts. What services do state and local workers provide? The jobs most commonly performed by state and local employees include education/teaching, law enforcement/public safety, fire protection, transportation, social, legal/court and medical services, clerical services. Figure 3 below lists the most common jobs and salaries for state and local employees according to the BLS Career Guide to Industries, 2010-2011 Edition. State and local government employee earnings were close to the national averages in most occupations. The annual earnings of most state and local workers track and move fairly closely with average earnings in the private sector. There are some exceptions and these usually have resulted from particular local political struggles and circumstances. Figure 3. Most Common State and Local Government Occupations and Mean Hourly Compensation Demographic Features and Context State and local workers are heavily unionized. Cuts in employment, wages and benefits at all levels of government will dramatically decrease the proportion of union employment in the US. As this goes to press 12.3% of Americans are represented by unions, 14.7 million people. This number declined by 612,000 across 2010. The rate of unionization has been falling since 1983, when these numbers began being tracked by the BLS. 2010 marked a new low with 11.9% of workers represented by unions, down from 20% in 1983. 36% of public sector workers were unionized in 2010 and 6.9% of private sector workers were in a union. More than half of all unionized workers are in the public sector. In 2010 7.6 million public sector workers were unionized and 7.1 million private sector workers were unionized. Six states: New York, California, Illinois, Pennsylvania, Ohio, New Jersey contain more than half of all union members. Rates of union membership are lowest in the Southeastern US where many states have less than 5% of their labor force in unions. Given the dramatic overrepresentation of unions in the state and local public sector, any major shift in employment in this sector will immediately and profoundly shift the role and size of unions in America. Figure 4. BLS Data % of Workers Unionized by Employer Type State and local employees have several demographic attributes that are not seen universally in the working public. African Americans have higher rates of government and union employment because of their concentration in regions and occupations covered by state and local unions. African Americans have a higher rate of state and local employment and a higher rate of unionized employment than the population average. Equal Opportunity Employment Committee data from 2007 suggests that 18% of full time state employees are black. At the city level, the same EEOC data suggest that 19% of full time employees are black. Major shifts in employment at the state and local level are likely to disproportionally impact communities of color- particularly African American communities. There is a unique history behind high levels of African American employment in many states and locales. This history emerged out of civil rights struggles and past patterns of severe employment discrimination against African Americans in hiring. Ethnic demographics of state and local employees display this pattern among historically abused ethnicities and women. Veterans are significantly overrepresented in public sector employment, including at the state and local level. In 2009, nearly 13% of all employed veterans worked for state and local government. Public sector employees tend to stay at jobs longer and tend to be older than private sector workers. Public sector workers are statistically more likely to be older, to be veterans, to be from communities of color and to be concentrated in urban areas of the Mid-Atlantic, West Coast or upper Midwest. These groups will be uniquely hurt by significant cuts in employment, pay, benefits to the public sector. I know some of the above information is dry. However, it is essential to have a realistic conversation about who, what and where we are cutting. Needless to say, lower income and special needs populations are likely to suffer most acutely from reductions in state and local services. Restrictions and reductions on hiring and compensation will further erode the middle class and are likely to increase inequalities of wealth and income.

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‘Global Burnout Syndrome’ May Hurt Recovery, Official Warns

January 20, 2011

GENEVA (By Jonathan Lynn) – The world is suffering from “global burnout syndrome” and is too weak to tackle the web of interrelated threats facing businesses and governments, the head of the World Economic Forum said on Wednesday. Klaus Schwab, who chairs the WEF that organizes the annual meeting of executives and politicians at Davos, said the world had not yet fully digested the crisis that emerged from the financial crunch, and was not yet in post-crisis phase. “We have to be careful that this crisis does not become a social crisis — which it has in some countries,” the German business studies professor told a media conference on the gathering at the Swiss resort from January 26 to January 30. “We have in the world a situation where the political system and the institutions are just overwhelmed by the complexity which they have to face,” he said. The Davos meeting, protected by beefed-up Swiss security which includes the closing of local airspace, is the world’s top networking event, allowing bankers and CEOs to rub shoulders with presidents and prime ministers, and to cut deals. But the uneven economic recovery makes it a particularly challenging time to be meeting, with emerging economies rebounding but rich countries still struggling. In the rich world social tension is rising as governments bring in austerity measures to pay off debt or postpone hard decisions on borrowing, while companies return to profitability and banks resume controversial bonus payments. Global forecasting and analysis group IHS says a restructuring of eurozone sovereign debt is inevitable and while it is unlikely that fringe countries will drop out of the euro, financial markets could force the next phase of crisis management as early as this year. “This will very likely include a debt restructuring plan, with ‘haircuts’ for investors and further aid for the European banks holding much of this debt,” IHS Chief Economist Nariman Behravesh said in a briefing for the Davos forum. COMBINATION OF RISK, FAILURE OF GOVERNANCE In a report last week, the WEF identified three interrelated nexuses of risks — economic, such as fiscal, trade and currency problems; raw materials, particularly the impact of rising energy costs and dwindling water supplies on food prices; and illegal trade, corruption and failed states. “It’s not just risks in isolation, it’s the combination of risks that can be so dangerous,” said WEF Chief Business Officer Robert Greenhill. Rising economic disparity and social tension nationally and the increasing inability of the global community to tackle problems proactively exacerbates these threats. “It’s that failure of global governance… which is perhaps the greatest risk of all,” Greenhill said. Glitz and hype surround the meeting in Davos, an upmarket ski resort made famous by German novelist Thomas Mann in his novel “The Magic Mountain” written at a time when it was better known for its sanitoriums for wealthy tuberculosis sufferers. But the organizers do not claim it can actually solve the problems it discusses — although anti-capitalist campaigners denounce it as a plutocratic cabal plotting global domination. “The World Economic Forum is not a decision-making body. It fosters dialogue, it fosters understanding,” Schwab said. But Greenhill said it will try to help with the complex of threats by launching a “global risk response network” bringing together company risk officers and government policy-makers. As usual the WEF will wheel out several global leaders among its 2,500 participants. The chair of the G20, French President Nicolas Sarkozy, addresses the forum on Thursday, January 27. Among 25 government heads expected are German Chancellor Angela Merkel and Russian President Dmitry Medvedev, who opens the forum on Wednesday, January 26. Medvedev, a keen user of the micro-blogging site Twitter, will take questions from the public via “crowdsourcing” on www.wef.ch/askdmitrimedvedev. The cast list also features eight central bankers, including European Central Bank President Jean-Claude Trichet, who will also take part in an open session accessible to the public, and 14 labor leaders and more than 1,400 CEOs and other business chiefs — 400 of whom will be using Twitter as “CEO reporters.” Davos’s reputation in the past was made by several high-profile diplomatic meetings on the sidelines. This year, seven key trade ministers hosted by the European Union will meet on Friday, January 28, as part of renewed efforts to conclude the nine-year-old Doha round to free up world trade — itself one of the biggest failures of global governance. For full coverage, blogs and TV from Davos go to www.reuters.com/davos (Editing by Louise Ireland) Copyright 2010 Thomson Reuters. Click for Restrictions .

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Richard L. Revesz and Michael A. Livermore: Obama’s Executive Order: Olive Branch to Whom?

January 20, 2011

Tuesday’s news of a new executive order on regulatory review was not welcomed by some progressives. President Obama announced his move in a Wall Street Journal op-ed , and it was widely perceived as an olive branch to regulated businesses. But in its substance, the order mostly boosts the case for a strong government hand in protecting the public from the negative consequences of the free market. The timing of the president’s actions is important, and has played a big role in how they’ve been received. Employment growth has lagged the economic recovery and there is massive ground to make up for jobs lost during the recession. After the mid-term election shellacking of the Democratic Party, many Washington insiders are looking for a rightward tack by the administration. But while the President certainly did make some rhetorical concessions in his op-ed that recognized that regulation can have its downsides (like the now-infamous saccharine example ), the substance of the order, and the president’s reaffirmation of the need for regulation at a time like this, show a deep commitment to an aggressive agenda of agency regulation. In fact, there are several important new changes in the order that respond to long-sought-after demands from progressives. There are beefed up public participation requirements, including a requirement for better use of the Internet to engage the public. In a separate presidential memorandum, Obama creates a system to significantly increase the transparency of agency enforcement, which is where the rubber meets the road for all regulatory programs. This transparency will give public interest groups the tools they need to ensure that the rules on the books actually have the bite of an agency watchdog. There is also new language added to the order that encourages agencies to take into account “equity, human dignity, fairness, and distributive impacts.” While it is too soon to say exactly how that will play out in practice, it gives advocates a hook to go to agencies and push for programs that help the most vulnerable members of society. Perhaps the most important piece of the new order, and the subject that has gotten the most attention, is a requirement for agencies to conduct “retrospective analysis.” This analysis has been called for from both sides of the political spectrum, but importantly, the Obama order requires agencies to look both at “excessively burdensome” and “insufficient” rules — directing agencies to identify areas where rule could be eliminated, but also strengthened. At a time of deep economic crisis, a call to increase regulatory stringency should help alleviate fears that the administration is backing away from its track record of strong protections. The order is definitely a compromise, like pretty much everything that happens in government. In addition to these largely progressive reforms, the president is requiring agencies to conduct special analysis for small businesses that could encourage agencies to write permissive loopholes into new rules. In some cases, small business exemptions might make sense, but this process gives an unjustified precedence to a particular group. Better would have been to expand the section on distributional analysis into a more detailed and systematic procedure, which could take small business impacts into account, as well as other important factors like how rule affect low-income or minority communities. But overall, the order is a solid step forward in the direction of more balanced review. If progressives want to find evidence that the Administration is changing its tune, they will have to look elsewhere (for example, recent moves by EPA to delay important rulemakings on hazardous air pollutants). On this executive order, the olive branch offered to industry is more likely to bear fruit for the public interest in the long term.

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Seven Companies That Rely On Aging Products

January 15, 2011

Some of America’s largest companies rely heavily on products which they have owned for decades to account for a very large portion of their sales and a significant part of their reputations with the public, customers, and investors. In most cases, the names of their flagship brands are essential to their marketing.

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David Isenberg: Outsourcing War and Peace: Part 4

January 13, 2011

This is the fourth of five excerpts from law professor Laura Dickinson’s book, Outsourcing War and Peace: Preserving Public Values in a World of Privatized Foreign Affairs . . Find previous parts in the archive here . Private military contactors and their advocates generally say they are all for transparency and willingly comply with all government requirements dealing with that. Many of them say this with an utterly straight face and, in fact, at least some of them are genuinely sincere about it. But is just an undeniable fact that for the average member of the public, when it comes to getting information about a private sector company, their task just became orders of magnitude more difficult. Bear in mind that while companies frequently, if not routinely, use the “confidential business information” as a dodge there are cases when they would be willing to release the information but their client, the taxpayer supported federal government, will assert the excuse, even when the company wouldn’t, simply because the government doesn’t want the information made public. And woe betides the rare PMC employee who sees something going wrong and out of conscience goes public with it. Usually that ends up being an example of no good deed goes unpunished. Here we find that the work of contractors performing foreign affairs functions for the U.S. government is far more opaque, and employees of contract firms have far fewer protections if they decide to come forward with information about abuse. The result is that citizens are far more likely to hear about, and be aware of, the acts of governmental entities abroad than they will be about similar acts performed by private contractors. Indeed, even the public research entity that provides information to Congress, the Congressional Research Service, reports that “the lack of public information on the terms of the contracts, including their costs and the standards governing hiring and performance, make evaluating their efficiency difficult.” Weaknesses in the sunshine laws, as they apply to contractors, are part of the problem. While FOIA does give individuals the right to request information about the activities of foreign affairs contractors, its reach over the contractors is more limited than its reach over government actors. First, FOIA confers a right to view only government materials and not private business documents. Thus, in any case involving a contractor, there is a threshold question as to whether the documents even qualify as government documents. Second, in addition to any national security restrictions on government materials related to contractor activities, the statute grants an additional exception for “confidential business information.” Thus, any government documents that might involve “trade secrets and commercial or financial information obtained from a person and privileged or confidential” are exempt. As a result, any contract terms that could qualify as “confidential business” matters would not be open to public scrutiny. Accordingly, although citizens and organizations have used FOIA to obtain information about foreign affairs contractors, the information available is more limited than is information about agency conduct. Indeed, even members of Congress have complained about the difficulty of obtaining information about contractors. Representative Jan Schakowsky of Illinois, for example, has said that she was repeatedly thwarted in efforts to review State Department audit reports of DynCorp contracts because the department was bent on protecting DynCorp’s commercial secrets. According to a DynCorp spokesperson, releasing government audit reports would make public cost-per-employee figures that could help competitors undercut DynCorp in future bids. Yet, as Schachowsky notes, the result is that “there seems to be no real interest in overseeing or reporting or holding accountable any of these contractors. And we’re talking about billions of dollars of taxpayer money.” Whistleblower statutes also provide weaker protections for contract employees than they do for government employees. For example, although federal law does prohibit reprisals against contractor employees who speak up about misconduct, the information disclosed must “relate[] to a substantial violation of law related to a contract.” Federal employees, by contrast, are protected when they speak up about violations of rules as well as laws, and even when they complain about gross misconduct that does not rise to the level of lawbreaking. In addition, federal employees may disclose the information in question to the general public, while contractor employees are protected only if they limit their disclosures to members of Congress, authorized agency officials, or the Department of Justice. Finally, contractors have weaker options for enforcing their rights. If they believe they have suffered retaliation, they may complain to the inspector general of the contracting agency, but it is up to the agency head to decide whether to pursue a remedy against the contractors. Federal employees, by contrast, may complain before administrative tribunals and seek judicial review of those decisions. And although contractor employees may bring suits under the False Claims Act, just as federal employees may, these suits are limited to cases of fraud and do not include other types of misconduct.

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‘The Most Amazing Press Release Ever Written’

January 12, 2011

The folks at PitchPoint Public Relations have really taken the press release genre to a whole new level. PR Newswire has posted a press release that is, in the words of its author Mitch Delaplane of PitchPoint, “the most amazing press release that has ever been written.” In an innovative approach to what can be deadly dull, Delaplane has written a press release that exists exclusively to call attention to its own greatness. “I’ve been in the business for over ten years and have to say, I’m speechless,” claims Delaplane.  ”The title alone grabs you and demands that it be read.  Then there’s this quote that completely takes things to an entirely new level.  I’m proud of this press release.  In fact, I think it is [really] amazing.” Read the full release below to soak in the totality of its awesomeness (h/t techcrunch ). The Most Amazing Press Release Ever Written PR Professional Distributes Groundbreaking Press Release CHICAGO, Jan. 11, 2011 /PRNewswire/ - Mitch Delaplane of PitchPoint Public Relations has issued the most amazing press release ever written.  While hundreds of press releases are distributed daily, Delaplane feels this particular release will go down in history as the most amazing press release that has ever been written. “I’ve been in the business for over ten years and have to say, I’m speechless,” claims Delaplane.  ”The title alone grabs you and demands that it be read.  Then there’s this quote that completely takes things to an entirely new level.  I’m proud of this press release.  In fact, I think it is [really] amazing.” Typically reserved for company news announcements and other public relations communications, the press release has long been the favored default for informing media about exciting, groundbreaking news.  Then this news release comes along and changes everything people thought they knew about press releases. “I’m quoting myself again because the first quote didn’t do it justice,” says Delaplane.  ”If you’re still reading this news release, then you know what I’m talking about when I say it’s something special.  In fact, it’s 483 words of pure awesomeness.  When it crosses the wires, I believe history will have been made.” The science behind this Earth-shattering news release lies in its simplicity – no science, just pure old press release craftsmanship.  It started with an incredible brainstorming session that asked a very simple question: “what makes a press release amazing?”  Elaborate notes from that brainstorm were then formulated into mesmerizing sentences, paragraphs and pages…all expertly designed to make you pause and reflect at the brilliance of this press release. Every single word of this news release was track changed, stetted, then track changed again to its original draft.  Upon final approval, it was spell checked, fact checked and printed for posterity.  The result is a two-page, 1.5-spaced news release that is like no other news release in existence. According to PitchPoint Public Relations you have just read the most amazing press release ever written.  If you agree, tell Mitch at mitch@pitchpointpr.com or follow him on Twitter at Lifeisamitch. If you disagree, issue your own press release and prepare for war.

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Video: Van Horn Says Unemployed’s Pessimism a Drag on Recovery

December 29, 2010

Dec. 29 (Bloomberg) — Carl Van Horn, director of the John J. Heldrich Center for Workforce Development at Rutgers University’s Edward J. Bloustein School of Planning and Public Policy, talks about U.S. unemployment and the potential impact on the economic recovery. Van Horn speaks with Carol Massar on Bloomberg Television’s “In the Loop.” (Source: Bloomberg)

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Richard (RJ) Eskow: The GOP and the Banks: Cutting the Garlic Budget as the Vampires Attack

December 22, 2010

Van Helsing: “The strength of the vampire is that nobody will believe in him.” America’s debt to Wall Street has soared since 1945 — and although the banks were rescued at the public’s expense, the public’s been left holding the bag for the recent drop in housing prices: Hmm… How many times has the word “vampire” appeared in books during the same period [1]? What does this mean? Does it reflect the public’s subconscious response to predatory banking? Or is it just some guy having nerdy fun with data sets by juxtaposing two trend lines that have nothing to do with one another? We report, you decide. Here’s what we do know: Like their fictional counterparts, America’s banks are revenants, re-animated creatures who were brought back from the dead through the public’s generosity. Now they’re feasting on the rest of us again, while politicians in Washington work to rob us of the few tools we can use to defend ourselves. With some Democratic complicity, Republicans are fulfilling the promise of Rep. Spencer Bachus, who said that “Washington and the regulators are there to serve the banks .” And what they’re serving them is you . The Count: “Listen to them! The creatures of the night. What music they make… ” The rap sheet against America’s banks grows longer and longer. They keep stringing people along with phony foreclosure negotiations, and then foreclose anyway. And we’re hearing more and more stories about bank agents who, as they’re invading and padlocking illegally foreclosed homes, also steal the private property inside them. In

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Richard (RJ) Eskow: The GOP and the Banks: Cutting the Garlic Budget as the Vampires Attack

December 22, 2010

Van Helsing: “The strength of the vampire is that nobody will believe in him.” America’s debt to Wall Street has soared since 1945 — and although the banks were rescued at the public’s expense, the public’s been left holding the bag for the recent drop in housing prices: Hmm… How many times has the word “vampire” appeared in books during the same period [1]? What does this mean? Does it reflect the public’s subconscious response to predatory banking? Or is it just some guy having nerdy fun with data sets by juxtaposing two trend lines that have nothing to do with one another? We report, you decide. Here’s what we do know: Like their fictional counterparts, America’s banks are revenants, re-animated creatures who were brought back from the dead through the public’s generosity. Now they’re feasting on the rest of us again, while politicians in Washington work to rob us of the few tools we can use to defend ourselves. With some Democratic complicity, Republicans are fulfilling the promise of Rep. Spencer Bachus, who said that “Washington and the regulators are there to serve the banks .” And what they’re serving them is you . The Count: “Listen to them! The creatures of the night. What music they make… ” The rap sheet against America’s banks grows longer and longer. They keep stringing people along with phony foreclosure negotiations, and then foreclose anyway. And we’re hearing more and more stories about bank agents who, as they’re invading and padlocking illegally foreclosed homes, also steal the private property inside them. In

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UK Public Borrowings hike to $36.1b

December 22, 2010

UK Public Borrowings hike to $36.1b

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Net Neutrality Rules Poised To Pass FCC Tomorrow

December 20, 2010

WASHINGTON — New rules aimed at prohibiting broadband providers from becoming gatekeepers of Internet traffic now have just enough votes to pass the Federal Communications Commission on Tuesday. The rules would prohibit phone and cable companies from abusing their control over broadband connections to discriminate against rival content or services, such as Internet phone calls or online video, or play favorites with Web traffic. FCC Chairman Julius Genachowski now has the three votes needed for approval, despite firm opposition from the two Republicans on the five-member commission. Genachowski’s two fellow Democrats said Monday they will vote for the rules, even though they consider them too weak. The outcome caps a nearly-16-month push by Genachowski to pass “network neutrality” rules and marks a key turning point in a policy dispute that began more than five years ago. “The open Internet is a crucial American marketplace, and I believe that it is appropriate for the FCC to safeguard it by adopting an order that will establish clear rules to protect consumers’ access,” Commissioner Mignon Clyburn, a Democrat, said in a statement. Yet many supporters of network neutrality are disappointed. Clyburn and the other Democrat, Michael Copps, both said the rules are not as strong as they would like, even after Genachowski made some changes to address their concerns. That sentiment was echoed by some public interest groups on Tuesday. “The actions by the Federal Communications Commission fall far short of what they could have been,” said Gigi Sohn, president of Public Knowledge. “Instead of strong, firm rules providing clear protections, the commission, created a vague and shifting landscape open to interpretation.” A number of big Internet companies, including Netflix Inc., Skype and Amazon.com Inc., have previously expressed reservations about the proposal as well. Meanwhile, even the weakened rules are likely to face intense scrutiny as soon as the Republicans take over the House next year. The chairman’s proposal builds on an attempt at compromise crafted by outgoing House Commerce Committee Chairman Henry Waxman, D-Calif., as well as a set of broad net neutrality principles first established by the FCC under the previous administration in 2005. The rules would require broadband providers to let subscribers access all legal online content, applications and services over their wired networks – including online calling services, Internet video and other Web applications that compete with their core businesses. But the plan would give broadband providers flexibility to manage data on their systems to deal with problems such as network congestion and unwanted traffic like spam as long as they publicly disclose their network management practices. Senior FCC officials stressed that unreasonable network discrimination would be prohibited. They also noted that this category would most likely include services that favor traffic from the broadband providers themselves or traffic from business partners that can pay for priority. That language was added to help ease the concerns of Genachowski’s two fellow Deomcrats. The proposal would, however, leave the door open for broadband providers to experiment with routing traffic from specialized services such as smart grids and home security systems over dedicated networks as long as these services are separate from the public Internet. Public interest groups fear that exception could lead to a two-tiered Internet with a fast lane for companies that can pay for priority and a slow lane for everyone else. They are also worried that the proposal lacks strong protections for wireless networks as more Americans go online using mobile devices. The plan would prohibit wireless carriers from blocking access to any websites or competing applications such as Internet calling services on mobile devices. It would require them to disclose their network management practices too. But wireless companies would get more flexibility to manage data traffic as wireless systems have more bandwidth constraints than wired networks. “Individuals who depend on wireless connections to the Internet can take no comfort in this half-measure,” said Joel Kelsey, political advisor for the public interest group Free Press. Republicans, meanwhile, warn that the new rules would impose unnecessary regulations on an industry that is one of the few bright spots in the current economy, with phone and cable companies spending billions to upgrade their networks for broadband. Burdensome net neutrality rules, they warn, would discourage broadband providers from continuing those upgrades by making it difficult for them to earn a healthy return on their investments. Still, Genachowski’s proposal is likely to win the support of the big phone and cable companies because it leaves in place the FCC’s current regulatory framework for broadband, which treats broadband as a lightly regulated “information service.” The agency had tried to come up with a new framework after a federal appeals court in April ruled that the FCC had overstepped its existing authority in sanctioning Comcast Corp. for discriminating against online file-sharing traffic on its network – violating the very net neutrality principles that underpin the new rules. Comcast argued that the service, which was used to trade movies and other big files over the Internet, was clogging its network. To ensure that the commission would be on solid legal ground in adopting net neutrality rules and other broadband regulations following that decision, Genachowski had proposed redefining broadband as a telecommunications service subject to “common carrier” obligations to treat all traffic equally. But Genachowski backed down after strong opposition from the phone and cable companies, as well as many Republicans in Congress.

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Don Tapscott: Macrowikinomics: Thriving in the Age of Hyper-Transparency

December 10, 2010

This article is the fifth installment in series to be written by Don Tapscott and Anthony D. Williams, authors of the newly released book Macrowikinomics: Rebooting Business and the World . Mark Parker, the CEO of Nike calls it “A masterpiece. An iconic and defining book for our times.” The Economist says it’s a Schumpeterian story of creative Destruction.” The book argues that many of the institutions of the industrial age have finally come to the end of their lifecycle, and are now being reinvented around a new set of principles and a networked model. Today’s blog looks this new age of WikiLeaks and hyper-transparency **** The arrest of Julian Assange doesn’t change the new reality faced by governments and corporations that have always craved secrecy. Even if Assange is put behind bars for an extended period, others will be happy to take his place. Think of the whack-a-mole game at the arcade. Hit one on the head and another will pop up. The WikiLeaks episode is just a hint of the world to come. We are entering an era of hyper-transparency. Courtesy of the Internet, people everywhere have at their fingertips the most powerful tool ever for finding out what’s really going and informing others. They are gaining unprecedented access to all sorts of information about governments, corporations and other organizations in society. Assange has announced that WikiLeaks is going after private-sector corporations next, starting with the financial services industry. This will undoubtedly unleash a new round of whistleblowers keen to reveal what they see as evidence of duplicity and moral turpitude by their corporate masters. But forced transparency goes beyond revenge by disgruntled employees. Customers can evaluate the worth of products and services at levels not possible before. Employees share formerly secret information about corporate strategy, management and challenges. To collaborate effectively, companies and their business partners have no choice but to share intimate knowledge. Powerful institutional investors today own or manage most wealth, and they are developing x-ray vision. Finally, in a world of instant communications, whistleblowers, inquisitive media, and Googling, citizens and communities routinely put firms under the microscope. Overall this is a positive development. Whether you’re a government or company, when you’re increasingly naked, fitness is no longer optional. Survival will force you to get buff. To be sure, all organizations have a right to secrecy. Companies have legitimate trade secrets. Transparency should refer to the release or exposure of pertinent information — information that can help stakeholders if they have it or harm them if they do not. Employees should not violate confidentially agreements or the law as in the case of WikiLeaks. But rather than defaulting to opacity as was done in the past, increasingly it makes sense to default to openness. Consumer electronics retailer Best Buy has adopted the principle that “our customers should know everything that we know” including data about the defect levels of the products they are selling. CEO Brian Dunn says this is not just a matter of building trust but rather “customers have a right to this information.” Nike has decided to reveal information about its patents and through launching the Green Exchange shares critical environmental data so that other companies can benefit. Fedex has built transparency into its supply chain as the company has found that free and open flow of information reduces transaction costs. Accenture CEO Bill Green has shocking candor with employees about everything from their financial performance to his personal struggle and tough decision to terminate the company’s contract with Tiger Woods. “Transparency with employees builds trust; it speeds up the metabolism of collaboration and increases loyalty,” he says. “Being open makes us better, and it’s just the right thing to do.” Rather than something to be feared, transparency is becoming central to business success. Every company needs a transparency strategy. It has to rethink what new information should be made available to employees, customers, business partners and shareholders. Corporations that are open perform better. Transparency is a new form of power, which pays off when harnessed. Embrace transparency as a force for good. It will result in high-performance business operations. Create good value because value is evidenced like never before. Embrace the principles of integrity, honesty, consideration and accountability as part of your organization’s DNA. In doing so you can build trust — the sine qua non of the networked world. Don’t confuse transparency with the lack of privacy. Transparency is an opportunity and increasingly an obligation for institutions. But transparency applies to institutions, not to individuals. Individuals have no such opportunity or obligation; they have a right to privacy. So while you’re becoming more open as an organization become more scrupulous to protect the private information of customers, employees and other people who are stakeholders. Much of this transparency argument also applies to governments. They are also becoming more open, which is good. Fifty years ago, few countries routinely released information about their economies. Indeed, many treated such information as state secrets. Now scores of countries post detailed economic statistics on the IMF’s website. A half-century ago, no country had laws specifically requiring government officials to provide information to their citizens. Now, nearly seventy countries do, and the number is still growing. Until as recently as the late 1990s, environmental regulation consisted largely of governments telling corporations what production processes to use. Newer regulations are increasingly about directing companies to tell the public the pollutants they are creating. By throwing thousands of raw cables out in the open, WikiLeaks has invited the world to sift through the details and draw its own conclusions. Washington’s elite may be discomforted by the notion that journalists and interested citizens alike can now hunt for embarrassing and perhaps even incriminating interchanges among diplomats. But in a world of hyper transparency, it turns out that many things including war and diplomatic relations will be subject to scrutiny. Even the world’s most ardent freedom-haters — including the despotic regimes in countries like Burma and Iran — cannot restrain the nascent forces of openness that are percolating in their societies. As the Iranian youth mobilization for freedom so vividly demonstrated, an explosive combination of youthful demographics and the spread of the Internet is helping oppressed peoples everywhere wrest open the authoritarian stranglehold that hangs over their social and economic destinies. Smart companies and governments understand that becoming more transparent is in the best interest of the public. Macrowikinomics available at: Macrowikinomics.com Follow Anthony Williams on Twitter: www.twitter.com/adw_tweets

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Video: Portugal’s Jobless Turn to Charities for Financial Aid

November 26, 2010

Nov. 26 (Bloomberg) — Bloomberg’s Nicole Itano reports from Lisbon on the impact of unemployment as Portuguese charities receive more requests for financial assistance from the public.

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Republicans Criticizing Elizabeth Warren’s Lack Of Transparency Had No Problems With Dick Cheney

November 24, 2010

Recently enough that you may still recall it, a secretive, paranoid man who had previously headed a major multinational energy company found himself vice president of the United States. This man deliberated privately with the heads of major oil companies as his administration set up a new energy policy that, perhaps coincidentally, wound up being strikingly generous to oil companies. The same man played a crucial role in leading the nation into a disastrous and costly war in a country that — again, perhaps coincidentally — held the world’s second-largest oil reserves. When, at the time, a few annoying sticklers for detail suggested there were problems with this flavor of policymaking, that perhaps it would have been better to hold deliberations in public so that people other than the heads of giant energy companies could have a say in the nation’s handling of energy, they were derided by this man and members of his party as naive and idealistic. Why clutter up the proceedings with citizens, journalists and other nudges who do not know how to get oil out of the ground? Leave things to the experts, we were told. So it is nothing short of astonishing to absorb the current spectacle. Republican members of the House — the same people who defended national troglodyte Dick Cheney in his effort to block public scrutiny on oil policy — are now criticizing the way Elizabeth Warren is making preparations for a Consumer Financial Protection Bureau, as if it were some sinister plot to destroy the republic. The White House’s appointment of Warren “circumvented the advice-and-consent process and undermined one of the key checks and balances in our Constitution,” declared Rep. Spencer Bachus (R-Ala.), the ranking member of the House Financial Services Committee, and Rep. Judy Biggert (R-Ill.) in a letter addressed Monday to the inspector general at the Treasury. “Treasury Department officials have provided little or no transparency with respect to their activities such as which organizations are meeting with Treasury officials.” Far be it from anyone to defend the Obama Treasury against charges that it lacks transparency. From its handling of its feckless homeowner-aid program, sold as a fix to the foreclosure crisis, to its administering of the Wall Street bailouts begun by its predecessors, this Treasury has been a maddening and combative model of misinformation, evasion and outright dishonesty. Again and again, it has sided with Wall Street over the public’s right to know, protecting Goldman Sachs and Bank of America in much the same way Dick Cheney lavished his nurturing ways on Halliburton and Exxon. But this idea that Republicans in Congress are now pursuing the public interest in challenging Warren’s authority, trying to derail her devious plot to make the world safe for people with credit cards and bank accounts, is nothing short of hilarious. It is a brazen exercise in what regular people call balls, one that must be admired for its sheer, breathtaking nature. Vice President Cheney, you will recall, had previously run Halliburton, a company that makes its money helping multinational energy firms extract more precious black liquid from the earth. This gave him an Oklahoma-sized conflict of interest when it came to deliberating on energy policy. It was fair to assume he would not be a particularly aggressive proponent of tighter energy-efficiency standards or an advocate for capping carbon emissions to limit climate change. He also played a central role in the nation’s national-security apparatus just as the deliberations — and perhaps that is a generous word — commenced on the ultimately horrible decision to invade Iraq. Cheney not only had personal truck with the heads of the oil majors, a clubby relationship with people who had every financial incentive to push for greater consumption of oil, but also the reasonable expectation of financial enrichment himself on the other side. Much as Larry Summers and Robert Rubin used their time at the Clinton Treasury to open up fresh profit-making opportunities for high finance in ways contrary to the public interest before landing on Wall Street, where they made enough to live like Maharajahs, Cheney could certainly have set himself up for a lucrative return trip to the oil patch. In short, the less-than-transparent way he handled energy policy could reasonably have been expected to hide some sweet goodies for powerful companies whose interest might have deviated from the public’s. Elizabeth Warren, the woman tasked with creating the CFPB, on the other hand, is a longtime law professor, an author of respected books on the breakdown of the American middle class, and a darling of consumer advocates. Are Republicans suggesting that she is using her current position to set up a consumer protection bureau that is so to the liking of consumer advocates that she could some day cash in with a plum job at, say, the National Consumer Law Center? Are they intimating that she stands to benefit in some way by using her new agency to damage the public interest? And how to square the Republican demands to know where she is drawing counsel with the Bush administration’s stonewalling on efforts to glean Treasury Secretary Hank Paulson’s conversational partners as he was crafting plans to send $700 billion in bailout funds to his old compadres on Wall Street? In the most generous reading, the Republicans really believe the rhetoric in their broadside and are clinging to a cultish reverence for free markets, one so extreme that they are adamant that the same bankers who brought the economy to its knees should enjoy the freedom to try it again. But don’t bet on that reading. The demands for transparency from a party that has only recently regained an appreciation for constitutional jurisprudence is merely the latest example of its oppose-everything mantra, a dynamic we are stuck with right up until the next presidential election. It is a cynical ploy premised on the belief that American memories run short — so short that we have already forgotten how today’s ardent protectors of due process are the same people who allowed Dick Cheney to run energy policy like an elaborate Christmas morning for oil companies.

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Janine R. Wedel: Shadow Elite: Truthiness, Porn and the Real Problem With Reality TV

November 18, 2010

What do the makers of reality TV and the makers of pornography have in common with some of America’s top power brokers? It may be less of a stretch than it sounds. All three exploit (and have helped usher in) a culture of truthiness, resulting in a polarized citizenry content to sit in their own self-assembled fact “cocoon”. This culture has also created a sort of backlash quest among viewers and voters for the scarcest of commodities these days: authenticity. Good luck finding it. Truthiness was named by Stephen Colbert only five years ago, but the trend he identified was already at least a decade in the making. It is one of the ways in which Western culture has moved away from many of the distinctions it once made. Institutional lines of authority frayed with the Cold War’s end. Today, think tanks act as news outlets, news outlets act as entertainment companies and corporations daily stand in for government. In the broader culture, new technology and social networking, along with the collapse of old-school media, fostered an explosion of (cheap) opinionated and confessional content. This meant that the distinctions between politics and entertainment, work and play, truth and fiction have become increasingly amorphous. The concept of truthiness itself bears some similarity to the French philosopher Jean Baudrillard’s notion of “simulacra.” Baudrillard argued that today’s society is constructed around “simulacra,” which (then) become reality. Simulation, unlike pretense, and like “truthiness,” produces real intuitive feelings, emotions, or symptoms in someone, and, therefore, blurs the difference between the “real” and “imaginary.” Today, it is the idea of reality that is often being performed and sought by the media, leaving the reality much more elusive. And there are examples across the culture that people are craving displays of certitude and authenticity, emphasis on the word “displays”: more often than not, what’s billed as true and real is merely the idea of reality or a kind of hyperreality. The explosion of reality TV, of course, is a blatant case. One would have to be as guileless as, say, Kenneth the Page on NBC’s 30 Rock to believe that reality TV is real and yet, does anyone believe that Jersey Shore would reach such a cultural saturation point if it was a fictional program? Its appeal seems to lie in the fact that it’s neither real nor fake, but actually exists in a limbo land between the two. “Snooki” is the bastard child of the contrived and the authentic. It’s notable too that the desperate TV housewives with the most buzz these days aren’t the fictionals ones on ABC, but the supposed “real” housewives on Bravo, who seem more fake than the fake ones. Janine spoke last spring with reality TV creator Howard Schultz who saw a niche to be filled in an environment where verifiable truth was in very short supply: Lying [has now been] elevated to an art form… We have many names – like ‘little white lies’ and ‘spin doctoring’. When the truth becomes relative, you lose your compass for traveling in life. I created [a show] that’s trying to introduce people back to the thing called truth–which is not your opinion, not what you feel. When opinion or feeling becomes the method of the moment, you lose sight that there is something called the truth. The moment everything becomes relative, there’s no way out….Nothing is held to account. People were held to account on Schultz’ show, to be sure – Fox’s wince-inducing Moment of Truth program from a few years ago. Contestants were asked increasingly embarrassing and personal questions, and the answers were judged true or false depending on the polygraph the contestants took before the show. The program aims for what most reality shows aim for and exploit: emotional spectacle. And at the heart of the marketing is that these are real people – would the spectacle be a spectacle if it was fictionalized? In a truthiness era, fiction just doesn’t hold the appeal and the reality has to be “realer than real.” The commodification of authenticity is even seen in what we think of as the land of artificial desire and silicone dreams, where everything is almost by definition a performance: the porn business. Anthropology professor Hülya Demirdirek who studies cyber porn culture, among other things, argues that these days one of the most compelling selling points in online porn is that what you are seeing is “real”, performed by supposed “amateurs”, whereas in the past there was little denial that the porn stars were acting. (It’s worth noting that non-simulated “real” sex has also been showing up in art house films like Michael Winterbottom’s 2004 9 Songs and 2003′s Brown Bunny , which is probably best known for featuring real sex acts between director Vincent Gallo and ex-girlfriend, actress Chloe Sevigny.) Janine in Shadow Elite explores how the most nimble power brokers of our day — she calls them flexians — are not supposed to be performing, but in fact are performing in whichever role suits their interest at that moment. Demirdirek’s porn stars are supposed to be performing but are going to great to lengths to show that they are not performing and that what they are doing is actually real. She argues that once a culture is saturated with performance, the artificial is no longer the premium product. So what does it matter that reality TV isn’t real (cue the collective “Duh”), or that porn stars are (gasp) faking it? The problem is that this blurring of the real and the fake — enabled by technology and social networking — is now hardly confined to popular culture. Those flexians, in Janine’s view, many of whom are purportedly working in the public interest, exploit all these vast new gray spaces where once was black and white. Players can easily get away with stage-managing their self-presentations, portraying themselves in ways that baldly contradict their previous presentations and realities. This is why a top power broker with a dismal track record and numerous controversies (like, say, former Treasury Secretary Larry Summers) can keep taking on roles of influence. Some argue that the public has gotten so used to constructed narratives with the veneer of truth that when neoconservatives within the Bush administration wanted to take the U.S. to war with Iraq in 2003, they were readily able to peddle, as the New York Times ‘ Frank Rich put it, “the greatest story ever sold.” For some porn stars, though, the pressure to offer the pretense of real can mean a more private tragedy: some Los Angeles production companies recently shut down because a performer tested positive for HIV. In the porn world, unfortunately, “real” sex is often, by all appearances, unprotected sex. No amount of performing or truthiness can rewrite that harsh bit of reality.

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The 14th Banker: Unsafe at Any Speed

November 17, 2010

When I first became aware of Ralph Nader , he was already considered a flake by the New Economic consensus that would shortly sweep Ronald Reagan into office. I would have laughed out loud if you had told me that 30 years later I would quote him. In the preface to his book, Unsafe At Any Speed , he says the following: This country has not been entirely laggard in defining values relevant to new contexts of a technology laden with risks. The post-war years have witnessed a historic broadening, at least in the courts, of the procedural and substantive rights of the injured and the duties of manufacturers to produce a safe product. Judicial decisions throughout the fifty states have given living meaning to Walt Whitman’s dictum, “If anything is sacred, the human body is sacred.” Mr. Justice Jackson in 1953 defined the duty of the manufacturers by saying, “Where experiment or research is necessary to determine the presence or the degree of danger, the product must not be tried out on the public, nor must the public be expected to possess the facilities or the technical knowledge to learn for itself of inherent but latent dangers. The claim that a hazard was not foreseen is not available to one who did not use foresight appropriate to his enterprise.” These words speak of legal and social developments in materials manufacturing going on 50 years ago. Yet it is striking that we have not achieved these most foundational values when it comes to another kind of manufacturing, the manufacture of financial products. The clock has completed its cycle on the day in which the Congressional Oversight Panel released its report on Mortgage Irregularities and the consequences for financial stability. In addition to documentation concerns, another problem has arisen with securitized mortgage loans that could also threaten financial stability. Investors in mortgage-backed securities typically demanded certain assurances about the quality of the loans they purchased: for instance, that the borrowers had certain minimum credit ratings and income, or that their homes had appraised for at least a minimum value. Allegations have surfaced that banks may have misrepresented the quality of many loans sold for securitization. Banks found to have provided misrepresentations could be required to repurchase any affected mortgages. Because millions of these mortgages are in default or foreclosure, the result could be extensive capital losses if such repurchase risk is not adequately reserved. The dawn will soon break in Europe, where volcanoes erupt with regularity. Today’s volcano is the Irish Debt Crisis and an apparent impending bailout or series of bailouts, this time more painful. I give you this link , not to endorse it’s assessment because frankly I don’t know. But the very fact that such extremity can be considered plausible and be posted to a highly reputable blog (not mine, Calculated Risk’s) paints the picture rather well does it not? So back to the quote from Ralph Nader’s preface. ”Where experiment or research is necessary to determine the presence or the degree of danger, the product must not be tried out on the public, nor must the public be expected to possess the facilities or the technical knowledge to learn for itself of inherent but latent dangers. The claim that a hazard was not foreseen is not available to one who did not use foresight appropriate to his enterprise.” I heard a commenter recently say that in financial services, “complexity is fraud”.  I am becoming inclined to believe him. Products have been introduced into the system which simply cannot be modeled by experiment or research. Yet they continue to be introduced, promoted, and defended by their issuers as well as those in government who have sold out to the industry. It is time for that to end.

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Timothy Karr: Comcast Kumbaya

November 16, 2010

Comcast wants you to trust them — to really, really trust them. That’s why their top lobbyist David Cohen convened what could be best described as a Kumbaya sing-along in Washington on Monday, to declare Net Neutrality as an issue over which Washington needn’t concern itself any longer. “It’s time to put this [Net Neutrality] debate behind us,” he told an audience of D.C. insiders at the Brookings Institution, “check the box and move on.” Now, don’t think this means Comcast has changed its tune on the importance of the open Internet. They’re still trying to kill Net Neutrality . They’re just making a softer sell in trying to convince Washington to keep its distance from protecting the rights of Internet users. “The courts, the FCC, and the Congress — All valuable institutions filled with capable, conscientious people … but few of them with the background to work out consensus on what are essentially complicated technical issues,” he said. To whom, then, should we turn to look out for the public interest? Why, the industry itself. According to Cohen, “real self-regulation” with the assistance of an industry-formed advisory group is the answer. Minding the Hen House The advisory group he has in mind, known as BITAG, was quickly cobbled together by Verizon, Comcast, AT&T, Microsoft, Intel and other major industry players in June 2010 — just as the Federal Communications Commission (FCC) starting to craft rules protecting Internet users against a phone and cable company push to exert more control over Web content and applications. Never mind that BITAG’s list of charter members includes the biggest violators of Net Neutrality — not least of all, Comcast. To that end Cohen skimmed over the Comcast’s covert campaign to block peer-to-peer users on its network — for which it was sanctioned by the FCC in 2008. How soon they would like us to forget that it was Comcast that was caught red-handed blocking lawful Internet traffic in 2007, and then lied about what it was doing. It was Comcast that tried to evade scrutiny by blocking public participation in an FCC hearing investigating its blocking. And when the FCC forced the company to stop discriminating against its customers, without even a fine, it was Comcast that sued on a technicality to avoid any accountability. But in an effort to whitewash its record of underhanded activity, Cohen claimed that the public reaction to this incident taught them a lesson about being better self-regulators. “In retrospect,” he said, “we made the wrong decision for the right reasons.” Though those who were blocked from sharing barbershop quartet music and the King James Bible might remember things differently. Bygones, said Cohen, who now claims Comcast was vindicated and can now be trusted with the fate of your Internet – and of NBC Universal , which it is now seeking government approval to take over. Fear and Self Loathing in Washington “Unfortunately, the national debate around Net Neutrality and an ‘open Internet’ has been almost exclusively driven by lawyers,” Cohen (who is a lawyer) declared, suggesting that it best be solved by industry’s engineers, who don’t have a stake in the outcome. Comcast hates lawyers so much that the company employs at least 100 of them from 30 different D.C. firms to lobby Washington on the issue. All Cohen’s lip-service about consensus would be more palatable if his company hadn’t poured so much money into astroturf front groups and lobbyists determined to undermine any effort to encourage fair competition and a level playing field online. The only thing you can trust about Comcast is that it seeks by any means possible to boost its bottom line and serve shareholders. That’s the nature of corporations. And naturally, the public shouldn’t expect corporations like Comcast to look out for our best interests. Public policy is designed for that role — to make it profitable for corporations to behave in ways that don’t harm the rest of us. The only thing that will keep Comcast honest is clear rules of the road and a real watchdog such as the FCC to enforce them.

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Video: Borelli Says Tea Party Values Clash With Corporations

October 29, 2010

Oct. 29 (Bloomberg) — Tom Borelli, a senior fellow at the National Center for Public Policy Research, talks about the economic philosophies of the Tea Party movement and the impact of government stimulus on private enterprise. Borelli speaks with Matt Miller and Carol Massar on Bloomberg Television’s “Street Smart. (Source: Bloomberg)

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Josh Silver: Washington Post Endorses Comcast-NBC: Ironically Proves Dangers of Mega-Merger

October 25, 2010

Today, the Washington Post published a piece of unabashed corporate advocacy , arguing that the pending mega-merger of cable giant Comcast and NBC-Universal should be swiftly approved by regulators. The editorial claims that media concentration is not a problem, and that “advocacy groups (opposing consolidation) have been poor prognosticators of the effects of large media mergers.” I’m not sure what planet the WaPo editors live on. Weakened media ownership limits have led to a media system with far too many newspapers, radio and television stations in too few hands. Public interest groups have correctly predicted the host of problems brought by rampant consolidation: woefully few outlets owned by women and people of color, huge profit pressures that result in job cuts, closed news bureaus, and a system where hard hitting, investigative commercial television and radio journalism is nearly an oxymoron. Radio is homogenized, with too many ads and opinions, and scant original reporting. On television, the most important issues are synthesized into seven second sound bites and impossibly short segments that are devoid of context and crucial information. The net result of ownership consolidation (aided and abetted by the rise of the Internet) is poorly-staffed newspapers and commercial television and radio that are long on hot-headed opinions, advertisements and mindless entertainment, but short on the substance that an informed democracy requires. Defenders of the status quo are either benefiting from it, or are like frogs in warming water: it happened so slowly, they haven’t realized it’s boiling over. The great irony of the Post’s endorsement is that the editorial itself is a poignant example of why the Comcast-NBC merger is so dangerous. When media companies control too much, their own interests — and opinions — directly conflict with the public’s desperate need for sound policy and diverse, independent, critical viewpoints. The Post is not a disinterested or neutral observer in this case. The Washington Post Company owns Cable One, provider of television, internet and phone services to several states. They own six television stations, a long list of print publications, plus Slate.com, Foreign Policy and other online sites. Yes, the op-ed technically discloses this, but fails to disclose how greatly these interests influence the Post’s position on this issue. The Post suggests that “FCC officials should resist calls by some merger opponents to impose ‘net neutrality’ principles.” Yet it fails to explain that, as an Internet service provider, the company has self-interest in abolishing Net Neutrality, the rule that prevents Internet providers from creating fast lanes and slow lanes on the Internet in order to maximize profits. The Post argues that the $30 billion deal “should be allowed to proceed,” and that strong conditions need not be applied to the deal. Instead “[c]ompetitors who believed that they were harmed by unfair dealing could have their complaints adjudicated by the FCC” on a case by case basis. But to anyone familiar with the FCC, the threat of enforcement is almost always an empty one. The process is long and expensive — and complaints languish for months or even years before any FCC action, if at all. And that’s for companies that can afford high-powered connections and high priced-attorneys. If you’re an average person whose cable bill is skyrocketing, or whose internet connection is slow and expensive — well, you’re screwed. The backlog of consumer complaints at the FCC is notorious. For the vast majority of people, the agency’s complaint process is a right without a remedy. Comcast is already the nation’s largest Internet broadband and cable television provider. NBCU owns 26 television stations, Universal Pictures, the NBC Television Network, Bravo, CNBC, NBC News, MSNBC, Oxygen, Syfy (Sci Fi Channel), Telemundo, USA Network, and the Weather Channel. If the merger is approved, a single corporation would own a huge array of popular content and would control how that content — and the content produced by its competitors – is distributed over the airwaves, cable, and Internet. As all media moves to a digital platform, the harms of the “vertical integration” of content and distribution become more severe. Comcast can starve competing online video providers by withholding access to NBC programming. It can also move video content that is currently offered for free on sites like NBC.com behind a “paywall” tied to a cable subscription so that you must pay for cable TV if you want to watch TV online. President Obama boldly proclaimed — on the campaign trail and once he took office — that he would promote policies that “encourage diversity in the ownership of broadcast media, promote the development of new media outlets for expression of diverse viewpoints, and clarify the public interest obligations of broadcasters who occupy the nation’s spectrum.” Obama’s top antitrust official Christine Varney said in May 2009, that “vigorous antitrust enforcement must play a significant role in the government’s response to economic crises to ensure that markets remain competitive.” Yet today, Wall Street analysts are increasingly bullish that the merger will be approved by the FCC and the Justice Department, cheered on by Washington Post’s editorial page. Score yet another victory for the entrenched big money interests that rule Washington, and yet another defeat for the American people.

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Video: TARP’s Massad Says PPIP Helped Restart Mortgage Markets: Video

October 22, 2010

Oct. 22 (Bloomberg) — Tim Massad, acting administrator of the U.S. government’s Troubled Asset Relief Program, talks with Bloomberg’s Mark Crumpton about the Public-Private Investment Program. The PPIP, a government program aimed at reviving the mortgage-backed securities market returned more than triple what stocks or bonds gained in the past year. (Source: Bloomberg)

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Britain’s Austerity Movement Will Hurt The Poor Most, Economists Say

October 21, 2010

LONDON — Britain’s poor and powerful clashed Thursday over who will lose out most under austerity measures that will slash benefits, jobs and government services to reduce the country’s crippling debts. Treasury chief George Osborne has announced 81 billion pounds ($128 billion) in spending cuts through 2015 that will cost as many as half a million public sector jobs and trim welfare payments to families and the disabled. Government departments will, on average, have their budgets cut by about 19 percent, forcing them to lay off staff and limit the scope of their work. It means Britain will have fewer police, pay less to those without jobs and send fewer criminals to prison. Embassies will be shuttered, as will courts and military bases. Britons will lose billions in benefit payments, retire later, and pay more for day-to-day items like train tickets. Even the Royal Mint faces cutbacks: It will use cheaper metals in British coins in an attempt to make savings. Osborne had said Wednesday in an address to Parliament that “those with the broadest shoulders should bear the greatest burden,” saying Britain’s highest earners would be worst affected by the cuts. But economists and the public disagree, believing the measures will cause most hardship for lower-paid government workers and Britons reliant on welfare checks. The Institute for Fiscal Studies, an economic think tank, said that – aside from the richest 2 percent of people – most of the pain would be inflicted on working families, the sick and the poor. “You’re really picking on the weakest people in society and it’s completely unfair how you’re applying these budget cuts,” Margaret Lynch, 52, told Prime Minister David Cameron and his deputy, Liberal Democrat leader Nick Clegg, as they defended the plan at a public meeting in Nottingham, in central England. Lynch, who has multiple sclerosis and uses a wheelchair, said outside the event that her government benefits were being cut by about half. Hundreds of Britons demonstrated against the cuts outside Downing Street, the prime minister’s official residence in London, late Wednesday. Police said three people were arrested for breaking into the government’s business ministry. Some legislators worry that women will lose out more than men, as about 65 percent of the public sector work force is female. Pension plans for women are changing more quickly than those of men, standardizing the retirement age at 66 for both genders by 2020. “Women are more likely to work in the public sector, and more likely to use public sector services,” said Stella Creasy, a Labour lawmaker who represents the London district of Walthamstow in Parliament. The Institute for Fiscal Studies said Osborne’s spending cuts are the deepest since World War II, and public services face the harshest budget limits since the mid-1970s. Britain’s opposition Labour Party said the Conservative-led coalition government is exploiting the economic gloom to reduce the size of government, a long-held Conservative ideal. “It is a blueprint for a smaller, meaner and nastier society ,” Labour lawmaker Angela Eagle told the BBC. The opposition says cutting public sector jobs could hamper Britain’s economic growth, favoring instead a slower pace of cuts. Osborne said Wednesday the cuts were an unavoidable remedy for the debts Britain piled up during the global financial crisis. The Labour government spent billions to bail out two major banks – the Royal Bank of Scotland and Lloyds Banking Group – and took full ownership of mortgage lender Northern Rock. The Labour Party was in office for 13 years, until May of this year, and was responsible for the initial response as the financial crisis began. The Treasury confirmed Thursday there will be a permanent levy on the balance sheets of banks – expected to raise about 2.5 billion pounds ($4 billion) a year by 2014 – and there will be further discussion of measures to curb bankers’ bonuses. ___ Associated Press Writer Benjamin Timmins in London contributed to this report.

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