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Thursday, May 31, 2012

Living On Minimum Wage


Paying Rent on Minimum Wage

By Andrew Rosenthal
NY Times
May 30, 2012

As part of its 2012 report on rent affordability, the National Low Income Housing Coalition released a chart thats been FLOATING AROUND THE INTERNET. It shows that there isn’t a single state in the country where its possible to work 40 hours per week at MINIMUM WAGE and afford a two-bedroom apartment at Fair Market Rent. In West Virginia and Arkansas, you’d need to work at least a 63-hour week, and thats as good as it gets. In California, Maryland, D.C., New Jersey and New York you’d need to work 130 hours or more. Hawaii comes in last place: 175 hours.

I can anticipate a few no-big-deal arguments, starting with the definition of affordability. By “affordable,” the Coalition means paying no more than 30 percent of income for housing costs (rent and utilities). And why a two-bedroom apartment, as opposed to a one-bedroom?

Both of these choices seem reasonable to me. Thirty percent is a generally accepted standard, and there are plenty of single-parent households as well as families where, for various reasons, only one member is able to work.

But even if you quibble with how exactly the Coalition put the chart together, its clear that there’s a mismatch between the minimum wage and the cost of living (or at least a decent cost of living). In New York, which is in the midst of a fight over raising the minimum wage, two individuals would need to work 68 hours a week each to manage the rent on a two-bedroom unit. If they have kids, the 70 percent of their paychecks left after rent won’t get them very far.

When he was campaigning for the presidency, Mr. Obama promised to raise the federal minimum wage annually. That hasn’t happened. Its the same as it was in January of 2009: $7.25 an hour. According to Bloomberg View, that amount, adjusted for inflation, “is actually lower than what a minimum-wage worker earned in 1968.”

Somehow I doubt MITT ROMNEY will highlight this particular broken promise in an attack ad, but that’s no reason for anyone else to give the president a pass.




Minimum Wage in U.S. Fails to Beat Inflation

By Ilan Kolet & Bob Willis
December 28, 2011

Workers in the U.S. earning the minimum wage are worse off now than they were four decades ago.

The CHART OF THE DAY shows that after adjusting for inflation, the federal minimum wage dropped 20 percent from 1967 to 2010, even as the nominal figure climbed to $7.25 an hour from $1.40, a 418 percent gain.

The decline would have been worse if not for increases that took place from 2008 through 2010 in how much employers were legally obligated to pay. Combined with more stable consumer prices, those adjustments helped trim the reduction in earnings from 41 percent at the end of 2007, following a decade of no change in minimum pay.

Hardship is increasing for lower-income levels, and the minimum wage reflects those at the lower end of the payroll spectrum,Ӕ said Ellen Zentner, a senior economist at Nomura Securities International Inc. in New York. With those meager wages in place, it makes it hard to imagine families doing with even less.Ӕ

A jobless rate that has exceeded 8 percent since February 2009, the longest stretch of such levels of unemployment since monthly records began in 1948, is one reason why workers have little leeway to press for higher wages. Adding in part-time workers who would prefer full-time jobs, and discouraged workers who would take a job if one were available, pushes the rate up to 15.6 percent as of November.

The loss of better-paying manufacturing jobs in the last three decades and the growth of service industries may be another reason why wages have failed to keep up with inflation, Zentner said.

Eighteen states and the District of Columbia have minimum wages above the federal level of $7.25 an hour, which is just over $15,000 per year for a full-time worker. Eight states—Arizona, Colorado, Florida, Montana, Ohio, Oregon, Vermont and Washington—will increase their minimum wage by between 28 cents and 37 cents an hour on Jan. 1, according to the National Employment Law Project, a non-partisan, not-for-profit organization that conducts research on unemployment.



Raise The Minimum Wage

The minimum wage of the past was a stronger standard, providing significantly more buying power than it does today. After its creation in 1938, the value of the minimum wage rose relatively steadily until its value reached a high point in 1968 (when its nominal value was $1.60 an hour).  Thereafter, it suffered dramatic erosion as Congress failed to adequately correct for inflation over time.

The minimum wage of $1.60 an hour in 1968 WOULD BE $10.59 today when adjusted for inflation.

See the Bureau of Labor Statistics’ Consumer Price Index INFLATION CALCULATOR.


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More Bad News For Long-Term Unemployed


A Little Help for the Long-Term Unemployed?

By Greg Kaufmann
May 18, 2012

There are 12.5 million unemployed people still seeking work in the United States, and over 5 million of them have been looking for work for twenty-seven weeks or longer.

These are the “long-term unemployed,” and their prospects for finding employment or getting assistance are rapidly diminishing.

The long-term unemployed now make up over 40 percent of all unemployed workers, and 3.3 percent of the labor force. In the past six decades, the previous highs for these figures were 26 percent and 2.6 percent, respectively, in June 1983.

Instead of helping these folks weather the storm and find ways to re-enter the workforce, our nation is moving in the opposite direction. In fact, this past Sunday, 230,000 people who have been looking for work for over a year lost their unemployment benefits. More than 400,000 people have now lost unemployment insurance (UI) since the beginning of the year as twenty-five high-unemployment states have ended their Extended Benefits (EB) program.

What makes the denial of this lifeline all the more absurd is the reason for it. As Hannah Shaw, research associate at the Center on Budget and Policy Priorities (CBPP), writes, “Benefits have ended not because economic conditions have improved, but because they have not significantly deteriorated in the past three years.”

Its all about an obscure rule called “the three-year lookback.”

Under federal guidelines, for a state to offer additional weeks of benefits it must have an unemployment rate of at least 6.5 percent, and - according to the lookback rule - the rate must be at least 10 percent higher than it was any of the three prior years.

Unemployment rates have remained so elevated for so long that most states no longer meet this latter criterion,” writes Shaw. She points to California as a prime example. “For more than three years, its unemployment rate has remained above 10 percent, but it fails the three-year lookback test because the rate didn’t rise sufficiently. As a result, over 90,000 Californians lost their benefits on Sunday.

Prior to Congress reducing the maximum number of weeks of unemployment benefits earlier this year, there was some discussion of changing the lookback rule to four years, or even suspending it. But in the end there wasn’t the political will to do it and there certainly isn’t now.

Shaw wants people to understand the real impact that these cuts have on the long-term unemployed.

“Many of these people have been looking for work for well over a year and now their UI benefits have ended sooner than expected,"she says. Many families rely on these benefits to make ends meet [and now] many are left with little else.”

Indeed in 2010, unemployment benefits kept 3.2 million people above the poverty line which is roughly $17, 300 for a family of three. A report from the US Government Accountability Office (GAO) gives some indication of what might lie ahead for people who exhaust their benefits.

Of the 15.4 million workers who lost jobs from 2007 to 2009, half received unemployment benefits, half didn’t, and about 2 million who did receive benefits exhausted them by early 2010. Those who exhausted benefits had a poverty rate of 18 percent, compared to 13 percent among working-age adults; more than 40 percent had incomes below 200 percent of the federal poverty line (below about $35,000 for a family of three), which is the level where many economists believe people start really struggling to pay for the basics.

While one might expect to see budgetary savings from reduced unemployment insurance payments, anti-poverty advocates say a shift in demand is more likely, as more people - especially families with children - turn to other safety net programs like food stamps, Medicaid and the Childrens Health Insurance Program. Assistance will be much harder to come by for individuals or couples without children, especially since state General Assistance programs have been decimated.

It is all the more alarming as National Employment Law Project executive director Christine Owens testified in Congress this week that older workers ages 50 and up are disproportionately represented in the ranks of the long-term unemployed. They made up over 29 percent of long-term unemployed workers in 2011, compared to just 26 percent in 2007. In 2011, more than 54 percent of older jobless workers were out of work for at least six months, and those high rates have continued into 2012. Owens noted that prolonged periods of unemployment can have a severe impact on older workers - retirement prospects and later-life well-being.

In addition to legislation protecting older workers from discrimination, Owens urged Congress to invest in subsidized employment and workforce development and job training programs - vital to unemployed workers of all ages.

According to the Center for Law and Social Policy, a 2005 study of seven states found that adults and dislocated workers receiving Workforce Investment Act (WIA) services - including job training - were 10 percentage points more likely to be employed and to have higher earnings (about $800 per quarter in 2000 dollars) than those who hadn’t received services. They were also less likely to need public assistance. A 2011 study by Washington State found that WIA services boost employment and earnings for adults, dislocated workers and youth.

House Republicans are attempting to” reform” federal workforce programs through the positively Orwellian-named “Workforce Investment Improvement Act.” When they say reform, they mean pulling out their handy-dandy, favorite tool: the block grant.

“Basically, the legislation would throw funding that currently is used for specialized training programs into one big pot - and reduce the amount of money in that pot,” says Shaw.

It’s true that job-training programs need improvement but simply cutting funding and eliminating programs wont do a thing to help anyone. What is needed is a serious effort along the lines of what economists Dean Baker of the progressive Center for Economic and Policy Research, and Kevin Hassett of the conservative American Enterprise Institute, describe in a New York Times op-ed:

Policy makers must come together and recognize that this is an emergency, and fashion a comprehensive re-employment policy that addresses the specific needs of the long-term unemployed. A policy packageshould spend money to help expand public and private training programs with proven track records; expand entrepreneurial opportunities by increasing access to small-business financing; reduce government hurdles to the formation of new businesses; and explore subsidies for private employers who hire the long-term unemployed. Managers who are filling open [government] positions should be given explicit incentives to reconnect these lost workers.

If there isn’t enough urgency for legislators and their constituents already, people should consider this: things are about to get worse. Not only did Congress fail to address the lookback earlier this year, it also made changes that will shorten the number of weeks people can receive temporary, federally funded benefits after exhausting their state-run programs. Those reductions will begin at the end of this month.

“It’s not going to be as dramatic as the end of the Extended Benefits program - there won’t be hundreds of thousands of people losing their benefits all at once,” says Shaw. But the changes are coming down the pipeline and will affect people in every state. The UI program will look very different in a few months than it does today.

So Rich, So Poor

By Peter Edelman

When it comes to public policy and poverty in the United States, few people know more about it than Georgetown University law professor Peter Edelman. He has battled poverty for nearly fifty years, most notably as a legislative assistant to Senator Robert Kennedy and as an assistant secretary of health and human services in the Clinton administration - a post he resigned in protest over the 1996 welfare reform bill. He’s taught and written extensively on the subject, too, including his new book, So Rich, So Poor: Why It’s So Hard to End Poverty in America.

Full disclosure: Edelman is a friend of mine and a mentor when it comes to anti-poverty work. I also had the opportunity to advise him on this book. Still, I wouldnt be writing this if I didn’t value the book, nor would he want me to.

So Rich, So Poor is a sweeping historical account and analysis of anti-poverty policy that will give readers a sense of where this nation has beenand where it’s headedwith regard to confronting (or failing to confront) poverty. Edelman examines the challenges of concentrated and intergenerational poverty, the safety net, the plight of those in deep poverty, disconnected youth, low-wage work, race and gender issues, housing policy and much, much more.

If you are a layperson, the book is a chance to absorb more than you probably ever realized is at the heart of the fight against poverty; if you are someone who has long been involved in the fight against poverty, I have little doubt you will find new ideas, angles or inspiration in these pages.

This is a man who has devoted a lifetime to fighting poverty and is passing along what heגs learned. Its a gift, frankly.

I had an opportunity to speak with him about the book and his perspective on poverty. This is what he had to say:

Greg Kaufmann: What do you hope readers get out of your book?

Peter Edelman: I hope to reach a broad audience of people who donגt know a lot about why so many people are poor in this country. I want people to understand that weve done a lot of things that have worked in reducing poverty, but also to understand why we still have so much poverty.

What do you say to people who respond that the reason we have so much poverty is that these programs don’t work and they are a waste of money?

The programs do work, and about 40 million more people would be poor if we didn’t have them. The problem is that we have so much low-wage work and too many people who are coping as single parents trying to live on income from one low-paying job. A second problem is that we have so many people who have incomes below half the poverty line - who are in deep poverty - and we are doing very little to help them. Since 2000 we’ve seen a rise in the number of people living in deep poverty from 12.6 million people to 20.5 million - they are living on incomes of less than about $11,000 annually for a family of four. And then we have the even more challenging problem of persistent and intergenerational poverty.

Can you say a little more about how that’s a different kind of problem to address?

Most people who are in poverty or deep poverty go in and out of those categories. But among those who are very poor, and others who remain poor for long periods of timees - pecially people who live in places where there is a lot of concentrated poverty - many of them have personal problems, and there’s a lot more of the consequences of inadequate education and a lack of jobs. So that whether it’s in an inner-city, or Appalachia, or on Indian reservations, or in the Mississippi Delta, we have places of poverty in this country that are even more challenging in terms of what we need to do.

What are some of the least talked-about aspects of poverty today?

The poverty problem in this country is, on the one hand, more a problem for white people than any other group; and on the other hand, its a problem that’s very much connected to race, and we need people to understand both sides of that.

The largest number of people in this country who are poor are white - they are the largest group. It’s also true that African-Americans, Latinos and Native Americans are poor at a rate that’s nearly three times the rate of poverty among whites. Why is that? It reflects continuing issues of race and gender. There’s disproportionate poverty among people of color because of history, continuing discrimination, structural racism in the way that our schooling is arranged for children, and the way our criminal justice system operates, and in residential patterns.

The American reaction to poverty tends to be a reflexive image of a person of color, and that in turn because of the way our politics are structured hurts the case for taking action. So we need to put race and gender on the table as part of the discussion.

Looking at the breadth and depth of the challenges involved in the fight against poverty, do you feel hopeful that we can rise and respond to them?

We know much more than we did at the time of the Great Society about what works, so that’s a good thing. But we do need much more political will, and we need more public understanding that these are problems that can be solved. We can help people get more income from work, we can have a better safety net, we can do a much better job of educating our children.

Some of the problems are very difficult, that’s for sure, but I think the biggest issue is for people to understand that its in our self-interest as a country to act. Not just because it’s morally right - although it is - but because an economy that includes everybody is going to be a better economy for everybody. It pays off economically for the whole country, not just for the people whose personal quality of life is improved. It costs us a huge amount of money in terms of lost productivity, crime-related costs and increased costs of healthcare not to act. One estimate is that we are losing at least $500 billion per year just due to the costs of child poverty.

What is the importance of the book coming out at this particular moment?

I hope that the book does some good in the context of the current election campaign that people will want to discuss the question of inequality not just at the top, not just the 1 percent, but also the 99 percent all the way down to the bottom. The table has been set by the Occupy Movement for a national discussion of inequality that includes the reasons why people are hurting so much at the bottom as well as why some people have so much at the top. We need to talk about poverty. The p-word needs to be in the discussion.

The Economic Hardship Reporting Project

Best-selling investigative journalist Barbara Ehrenreich and the Institute for Policy Studies have launched the Economic Hardship Reporting Project to help move the crisis of poverty and economic insecurity to the center of the national conversation.

The Project aims to let unemployed, underemployed and those whose employment situations are tenuous know that they are not alone, that the current economic crisis is not their fault and that they are not always getting the information they need to find solutions. Through innovative journalism on poverty and economic hardship, reporters will tell compelling stories of individuals and families that are linked to the bigger picture - exploring extreme inequality and the decline of the middle class.

Significantly, the Project is inspired in part by the Depression-era Federal Writers Project and is collaborating with several unemployed or underemployed journalists. Freelancing is a tough road, especially right now. In recent months Ive heard from talented reporters who have had to turn to the safety net themselves. I’ve spoken with highly accomplished journalists whose names many of you would know - who have been asked by major media outlets to writefor free just to keep their names out there (and because the outlets know they can get away with it).

“I am impatient with the standard liberal discourse on poverty,” said Ehrenreich. “We can’t go on talking about poverty without talking about how its being manufactured and intensified all the time.”

Ehrenreich launched the Project this week with her article, “Preying on the Poor.” I’m proud to be one of a number of advisers involved with this important effort and I hope you will follow and support it.

Much has been written in recent years about the link between “toxic stress” in young children and their educational, health and social outcomes later in life, as well as the public policy implications when it comes to addressing poverty. The brain is extremely pliable in the prenatal and early years, and brain architecture can be changed for the better or worse during this window. It then becomes increasingly difficult to modify over time.

For an incredible demonstration of the impact of stress on a baby and this stress isn’t even all that toxic and lasts less than a minute - check out this video from ZERO TO THREE, a nonprofit organization working to improve the lives of infants and toddlers.

Jodie Levin-Epstein, deputy director of the Center for Law and Social Policy (CLASP), reacted to the video this way: From CLASP’s perspective, this video shows the fall-out from the time-poverty of parents. Fully 40 percent of working low-income parents (below 200 percent of the poverty line) have no paid time off of any kind - no parental leave, no vacation, no sick days. This is a no-brainer to fix. The US should join virtually every other nation on the globe and provide paid leave for parents. So far, the presidential candidates have not addressed this issue head-on. It’s time. And then we need to ensure good early child care.

Get Involved

Put Childcare on the Map. Currently only about one in six children that qualify for federal child care assistance actually receives it, and itӒs not on the minds of too many members of Congress. Make sure they understand just how urgent quality, affordable child care is for working families. RESULTS, the National Womens Law Center and the Early Care and Education Consortium have launched this new long-term campaign to put child care on the map.

Raise New York’s Minimum Wage. Good news for New Yorkers: the Assembly has voted to raise the states minimum wage to $8.50 and index it to inflation. But Governor Andrew Cuomo has not committed to the bill, nor has he urged the Senate to pass it. The National Employment Law Project notes that the wage would be over $10.50 today if it had maintained its value since 1970. The current wage is $7.25 an hour so a full-time worker earns $15,080 annually.

“Poverty wages are good for Walmart and McDonalds, but they’re not good for New York,” said Dan Cantor, executive director of the Working Families Party. New Yorkers can urge Governor Cuomo and Albany to take action here.

Hold the House Accountable. Last week I wrote about the cuts to lower-priority spending that House Republicans voted for in order to protect defense spending and tax cuts for the wealthy. The bill would slash food stamps, Medicaid, the Affordable Care Act, the Child Tax Credit, the Social Services Block Grant and other programs poor people rely on at a time of record poverty. In an email, the Coalition on Human Needs (CHN) writes, ԓThe people who want to protect or increase military spending and tax breaks at the top are making their views known, day after day. We cannot be silent. CHN is giving you the opportunity to express your displeasure or approval with your Representative’s vote here. The only way they will know we care about poverty is if we start telling them we care about poverty.

Save the American Community Survey. The House voted last week to eliminate funding for the US Census Bureaus American Community Survey. ItԒs the only source of objective and comprehensive information about the nations social, economic, and demographic characteristics down to the neighborhood level. The information is used by the public, private and nonprofit sectors for everything from funding programs and assessing their effectiveness to enforcing the Voting Rights Act to delivering goods and services. You can find your Senator and tell him or her to save the American Community Survey here.

Notable Studies

Welfare Reform: What Have We Learned in Fifteen Years? Urban Institute & MDRC. Fifteen years after the Temporary Assistance for Needy Families (TANF) program replaced America’s longstanding cash-assistance entitlement, eight briefs by the Urban Institute and MDRC assess how well TANF works within the larger social safety net and to what extent it helps families receiving aid toward self-sufficiency.

Policy Matters: Public Policy, Paid Leave for New Parents, and Economic Security for US Workers, the Center for Women and Work at Rutgers, the State University of New Jersey and the National Partnership for Women & Families. The report shows how paid leave policies can be viewed as proactive public investments in the health and well-being of children and families in the United States. Also, public assistance and food stamp receipt are lower for new mothers who live in states with paid leave policies.



Video: 250,000 Americans to Lose Unemployment Benefits

Opposing Views
May 30, 2012

In February, Congress put restrictions on extended unemployment benefits in states in which the unemployment rate has dropped, so as many as a quarter of a million people will lose their benefits much sooner than expected, reports CBS News (video below).

The checks are stopping for the people who have the most difficulty finding work, the long-term unemployed. More than five million people have been out of work for longer than half a year.

Federal benefit extensions, which supplemented state funds for payments up to 99 weeks, were intended help the unemployed until the job market improved.

Next month, an additional 70,000 people will lose benefits earlier than they expected, bringing the number of people cut off prematurely this year to close to half a million, according to the National Employment Law Project.



Long-term unemployment crisis rolls on

By Charles Riley
June 11, 2012

The national unemployment rate has fallen from its recession highs, but Americans who have been out of work for six months or more are still having trouble finding work.

The numbers are staggering. The ranks of the long-term unemployed swelled last month from 5.1 million to 5.4 million, and those individuals now account for 42.8% of the unemployed.

Meanwhile, the average length of time the unemployed have spent out of work has climbed steadily higher—and older Americans have been the hardest hit.

“The result is nothing short of a national emergency,” economists Dean Baker and Kevin Hassett wrote recently in the New York Times.

“Millions of workers have been disconnected from the work force, and possibly even from society. If they are not reconnected, the costs to them and to society will be grim,” the economists said.

Congress and state legislators have tried all manner of programs to ease the plight of the long-term unemployed, and some have succeeded around the margins.

But four and half years after the recession, long-term unemployment still ranks as one of the economy’s most pressing problems.

The issue is so endemic that economists are now debating whether it will result in a permanent jump in the unemployment rate.

Economists fall into two basic camps. Some think elevated unemployment is a structural problem—or one likely to persist despite continued economic growth.

This implies a mismatch between the jobs employers are offering and the skills of the unemployed—and a less obvious path back to a low unemployment rate.

But others believe the current unemployment problem is due to slack demand and therefore cyclical. Federal Reserve Chairman Ben Bernanke and his lieutenant Janet Yellen are in this camp.

“While the magnitude of structural unemployment is uncertain, I read the evidence as suggesting that the bulk of the rise during the recession was cyclical, not structural in nature,” Yellen said last week.

Of course, as Yellen suggests, it is quite possible that both structural and cyclical factors are feeding into the plight of the long-term unemployed.

Still, the fact that economists are unable to agree on why the labor market has been so slow to recover suggests that no policy solution will be immediately forthcoming.

Even as little progress is made, Congress and state legislators have enacted laws making it more difficult for chronically out of work individuals to collect unemployment insurance.

More than a half million of the long-term unemployed are losing their federal extended unemployment benefits in the coming months.

The federal extended benefits program has provided the jobless with up to 20 weeks of unemployment checks after they’ve run through their state and their federal emergency benefits, which together last up to 79 weeks.

But the extended benefits program is expiring throughout the country as the economy improves.

To be eligible for these payments, a state must show that its unemployment rate is at least 10% higher than it was in at least one of the past three years.
Not working: Voices of America’s laid off workers

And state unemployment rates have been dropping as the jobless find new positions or exit the workforce.

Some of those who lose benefits will continue to look for jobs and be included in the unemployment rate. Others will take whatever they can get, which will put them in the “employed” category.

But others will just drop out of workforce entirely. Some may go back to school, while some will retire earlier than planned.

The scaling back of benefits has long been a priority of congressional Republicans, who worry that extended benefits are creating an dependency on government help and prolonged joblessness.

Democrats argue that unemployment benefits are an effective stimulus measure, as the money is often pumped directly into the economy in the form of consumer spending.

Baker and Hassett, the economists, argue that policymakers must recognize that long-term unemployment is a crisis, and craft a bipartisan plan to expand training plans and small business financing, reduce government red tape, and explore subsidies to expand hiring.

“Every month of delay is a month in which our unemployed friends and neighbors drift further away,” they said.


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Wednesday, May 30, 2012

Florida Under Seige


As a Floridian that was laid off from his six year job last month, but didn’t qualify for unemployment insurance - I can speak with authority that Florida’s 60 year unemployment safety net program suffered severely since being gutted last year by Governor Scott.

Check out THIS, THIS, THIS - and the stuff below.


Florida law thwarts jobless benefits, advocates tell feds

By Jim Stratton
Orlando Sentinel
May 24, 2012

Advocates for the unemployed called Thursday for a federal investigation of a Florida law they say systematically tries to prevent laid-off workers from receiving jobless benefits.

State regulations approved last year have made Florida the toughest state in the nation in which to get jobless benefits, detractors say, lowering significantly the percentage of the unemployed who now qualify for benefits.

The National Employment Law Project and Florida Legal Services want the U.S. Labor Department to investigate and overturn the regulations that tightened the state’s unemployment-eligibility rules.

“The state is blocking workers from accessing help they are qualified for and twisting the knife in the state’s ailing economy,” said Valory Greenfield, a senior attorney with Florida Legal Services. “Nowhere in the country is it this hard to get help when you lose a job.”

In 2011, 17 percent of the unemployed in Florida received benefits. Nationally, the figure was 27 percent. In the fourth quarter of the year, Florida’s rate fell to 15 percent.

The law affects the state’s most vulnerable, Greenfield said.

“We’re talking about people who are hungry, whose rent is due, whose mortgage is due.”

A spokesman for the Department of Economic Opportunity said the state consulted with federal officials before the measure became law.

He said the state “welcomes any review and is certain” that the “legislation is in full compliance” with federal law.

The law changed how workers apply for benefits, ending, for example, the option of filing for them over the phone. It also requires claimants to keep track of their work-search efforts and submit those online.

Both groups said that creates unnecessary hurdles for people who can’t easily go online.

The law also requires laid-off workers to complete a 45-question skills assessment, featuring 15 items on applied math, 15 on reading comprehension and 15 on locating information.

The complaint says state officials assured federal regulators the assessment would be used only as a condition of continuing eligibility. But the state has used it, they say, as a prerequisite for benefits.

Greenfield said the state has done a poor job of making clear that applicants must complete the test within 17 days of filing for benefits. She also said many applicants are confused because there is a second skills test on the state’s Employ Florida website.

“People think that’s the one they need to complete,” she said.

NELP and Florida Legal Services said between August 2011 and mid-April 2012, more than 43,000 people were denied benefits because they did not finish the initial skills review. Through the first three months of this year, denials related to procedural mistakes were up 200 percent compared with the same time last year.

Arthur Rosenberg, a staff attorney with Florida Legal Services, said, “these are people who are eligible, but were unable to access the benefits they’re entitled to.”

The complaint reflects a philosophical difference in how unemployment insurance is viewed. Worker advocates see it as an earned benefit - something an employee gets only after establishing a work history. But many business owners consider it akin to an assistance program financed by payments they make to the unemployment trust fund.

Gov. Rick Scott and the Republican-led Florida Legislature have made reducing the number of people on unemployment a POLICY GOAL. They have pursued that by trying to bring more jobs to the state and by tightening eligibility criteria.

The state has long had some of the least generous benefits in the country - a maximum of $275 per week and last year’s actions burnished that reputation.

The legislation being challenged also cut the total number of weeks available under state unemployment from 26 to 23 and tied maximum weeks available to the statewide unemployment rate.

As unemployment falls, the number of weeks someone can collect falls with it. Once the jobless rate hits 5 percent, the total number of weeks drops to 12 weeks. IN APRIL, the state’s unemployment rate was 8.7 percent.



Gov. Rick Scott, Aren’t You Going To Apologize To Welfare Recipients?

By Susie Madrak
Crooks and Liars
August 11, 2011

Since the state began TESTING welfare applicants for drugs in July, about 2 percent have tested positive, preliminary data shows.

Ninety-six percent proved to be drug free—leaving the state on the hook to reimburse the cost of their tests.

The initiative may save the state a few dollars anyway, bearing out one of Gov. Rick Scott’s arguments for implementing it. But the low test fail-rate UNDERCUTS another of his arguments: that people on welfare are more likely to use drugs.

At Scott’s urging, the Legislature implemented the new requirement earlier this year that applicants for temporary cash assistance pass a drug test before collecting any benefits.

The law, which took effect July 1, (and STRUCK DOWN AS UNCONSTITUTIONAL two years later. ed.) requires applicants to pay for their own drug tests. Those who test drug-free are reimbursed by the state, and those who fail cannot receive benefits for a year.

[...] Cost of the tests averages about $30. Assuming that 1,000 to 1,500 applicants take the test every month, the state will owe about $28,800-$43,200 monthly in reimbursements to those who test drug-free.

That compares with roughly $32,200-$48,200 the state may save on one month’s worth of rejected applicants.

The savings assume that 20 to 30 people—2 percent of 1,000 to 1,500 tested—fail the drug test every month. On average, a welfare recipient costs the state $134 in monthly benefits, which the rejected applicants won’t get, saving the state $2,680-$3,350 per month.

But since one failed test disqualifies an applicant for a full year’s worth of benefits, the state could save $32,200-$48,200 annually on the applicants rejected in a single month.

Net savings to the state—$3,400 to $8,200 annually on one month’s worth of rejected applicants. Over 12 months, the money saved on all rejected applicants would add up to $40,800-$98,400 for the cash assistance program that state analysts have predicted will cost $178 million this fiscal year.

Actual savings will vary, however, since not all of the applicants denied benefits might have actually collected them for the full year. Under certain circumstances, applicants who failed their drug test can reapply for benefits after six months.

[...] More than once, Scott has said publicly that people on welfare use drugs at a higher rate than the general population. The 2 percent test fail rate seen by DCF, however, does not bear that out.



Florida GOP Takes Voter Suppression to a Brazen New Extreme

By Ari Berman
Rolling Stone
May 30, 2012

Imagine this: a Republican governor in a crucial battleground state instructs his secretary of state to purge the voting rolls of hundreds of thousands of allegedly ineligible voters. The move disenfranchises thousands of legally registered voters, who happen to be overwhelmingly black and Hispanic Democrats. The number of voters prevented from casting a ballot exceeds the margin of victory in the razor-thin election, which ends up determining the next President of the United States.

If this scenario sounds familiar, thats because it happened in Florida in 2000. And twelve years later, just months before another presidential election, history is repeating itself.

Back in 2000, 12,000 eligible voters - a number twenty-two times larger than George W. Bush’s 537 vote triumph over Al Gore - were wrongly identified as convicted felons and purged from the voting rolls in Florida, according to the Brennan Center for Justice. African Americans, who favored Gore over Bush by 86 points, accounted for 11 percent of the states electorate but 41 percent of those purged. Jeb Bush attempted a repeat performance in 2004 to help his brother win reelection but was forced to back off in the face of a public outcry. Yet with another close election looming, Florida Republicans have returned to their voter-scrubbing ways.

The LATEST PURGE comes on the heels of a trio of NEW VOTING RESTRICTIONS passed by Florida Republicans last year, disenfranchising 100,000 previously eligible ex-felons who’d been granted the right to vote under GOP Governor Charlie Crist in 2008; shutting down non-partisan voter registration drives; and cutting back on early voting. The measures, the effect of which will be to depress Democratic turnout in November, are similar to voting curbs passed by Republicans in more than a dozen states, on the bogus pretext of combating “voter fraud” but with the very deliberate goal of shaping the electorate to the GOP’s advantage before a single vote has been cast.

Florida Republicans have taken voter suppression to a brazen extreme. After the 2010 election, Gov. Rick Scott, a Republican, instructed Secretary of State Ken Browning to compile a massive database of alleged “NON-CITIZEN" VOTERS. Browning resigned in February rather than implement Scott’s plan, saying “we were not confident enough about the information for this secretary to hang his hat on it.”

But in early May his successor, Ken Detzner, a former beer-industry lobbyist, announced a list of 182,000 suspected non-citizens to be removed from the voting rolls, along with 50,000 apparently dead voters. (Seven thousand alleged felons had already been scrubbed from the rolls in the first four months of 2012). On May 8, the state mailed out a first batch of 2,600 letters to Florida residents informing them, “you are not a United States citizen; however you are registered to vote.” If the recipients do not reply within thirty days and affirm their U.S. citizenship, they will be dropped from the voter rolls.

The first batch of names was riddled with inaccuracies. For example, as the progressive blog THINK PROGRESS NOTED, “an excess of 20 percent of the voters flagged as ‘non-citizens’ in Miami-Dade are, in fact, citizens. And the actual number may be much higher.” If this ratio holds for the rest of the names on the non-citizens list, more than 35,000 eligible voters could be disenfranchised. Those alleged non-citizens have already included a 91-year-old WORLD WAR II VETERAN whos voted since he was 18 and a 60-year-old KENNL OWNER who has voted in the state for four decades. It’s impossible to quantify how many eligible voters will be scrubbed from the rolls if theyve moved, aren’t home, dont have ready access to citizenship documents, or wonҒt bother to reply to the menacing letter.

“There are lots of things that can go wrong when you have these large-scale systematic purges,” says Myrna Perez, senior counsel in the democracy program at the Brennan Center for Justice. “They need to be done really carefully, with a lot of transparency, well in advance of the election. And this is too close.” Florida Republicans are following the lead of GOP SECRETARIES OF STATE in places like Colorado and New Mexico, whove made outlandish and unsubstantiated claims about non-citizens voting based on sketchy data, bad methodology, and anti-immigrant sentiment.

The purge has sparked a bipartisan outcry from local election officials in Florida. “The state’s supervisors of elections are very, very disturbed,” says Ian Sancho, supervisor of elections in Leon County, which includes the state capital of Tallahassee. “This was dumped into our laps at the 11th hour. Those of us who have been here long enough get this eerie similarity to the flawed felon databases of 2000 in Florida.”

Adds Deirdre McNabb, president of the Florida League of Women Voters: “We are very, very concerned about this news because of the track record in this state of purging thousands of voters who should not have been purged. Were deeply troubled and appalled this is happening just months before a major national election.”

As in 2000, the purge disproportionately targets DEMOCRATIC VOTERS. Two-thirds of the alleged non-citizens on the initial purge list reside in heavily Democratic Miami-Dade County, which supported Obama by 17 points over McCain in 2008. The county had the third highest number of naturalized citizens from 2009 to 2011, meaning that many new citizens could very likely be listed as non-citizens in the state databases. Florida Hispanics, who voted 57 percent for Obama in 2008, are only 13 percent of the state’s electorate but make up 58 percent of the non-citizens list. Whites, by contrast, account for 68 percent of registered Florida voters but only 13 percent of alleged non-citizens. Democrats outnumber Republicans on the list by two to one. “Attempts to purge the voter roll so soon after signing one of the nations most controversial voting laws raises concern, especially among young and minority voters,” Florida Senator Bill Nelson wrote in a letter to Scott.

Minority voters also bore the brunt of the voting restrictions passed by the GOP last year. Hispanic and African-American voters were twice as likely as white voters to register to vote through non-partisan voter registration drives run by the likes of Rock the Vote and the League of Women Voters, which had to suspend their registration efforts in the state due to new onerous bureaucratic requirements, which threaten to turn civic-minded volunteers into criminals. As a result, black and Hispanic voter registration has declined 10 percent in Florida relative to 2008, according to the Washington Post, with 81,000 fewer voters registered during a comparable period in 08, says the New York Times. African Americans also made up 54 percent of early voters in 2008; early voting has subsequently been cut from 14 to 8 days, with no voting on Sunday before the election, when black churches historically mobilize their constituents. (The Department of Justice has objected to the changes under Section 5 of the Voting Rights Act, which prohibits discrimination against minority voters.)

The registration and early-voting restrictions took effect one day after the law passed, under an emergency statute designed for “an immediate danger to the public health, safety or welfare.” Like the purge, the election changes were sold under the banner of “voting integrity,” even though so-called voter fraud cases are virtually non-existent in Florida, as in the rest of the country. From 2008 to 2011, the Florida Department of Law Enforcement received just 31 complaints of suspected voter fraud, resulting in only three arrests statewide. “No one could give me an example of all this fraud they speak about,” said Mike Fasano, a Republican state senator who opposed the new restrictions.

The state has already pledged that “several thousand” more alleged non-citizens will be targeted from the purge list. “The state told us weҒre going to get names routinely,” says Carolina Lopez, special project administrator for the Miami-Dade County Board of Elections. The purge is likely to be challenged by a host of voting rights groups under the National Voter Registration Act, which prohibits changes to the voter rolls ninety days before an election (Florida holds state and local primaries on August 14). The Justice Department could also intervene under the authority of the Voting Rights Act. But, despite widespread condemnation, theres no sign that Gov. Scott is preparing to reverse course.

Following the 2000 election, a major report from the US Commission on Civil Rights found that “statistical data, reinforced by credible anecdotal evidence, point to the widespread denial of voting rights [in Florida].” Ian Sancho, the Leon County elections official, says the political climate surrounding voting in the state is even “more hyper-partisan than in 2000,” which is hard to fathom. If the presidential election is once again decided in the Sunshine State, heaven help us all.


Posted by Elvis on 05/30/12 •
Section Dying America
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Monday, May 28, 2012

Pills For Stress and Depression


Are you taking pills to deal with depression or the stress of job loss or underemployment?


Antidepressant medication, all by itself, puts depression into remission for 30% of patients, a government-funded study shows


It is widely believed that antidepressant drugs are the best treatment for stress, depression and anxiety. After consulting with their health professional, many sufferers will be put on a course of antidepressants, but how effective are these drugs? Not very, in fact they cannot provide a permanent cure and here are the reasons why.

Antidepressant drugs are used to treat STRESS, depression and anxiety because of an alleged “chemical imbalance” within the brains of sufferers. What this means is that there is a lack of a chemical responsible for regulating our moods called Serotonin. If there is a lack of serotonin in the brain, is this then the root cause of anxiety, depression and stress? Unfortunately, there is no evidence at all to support this theory. Indeed, low levels of serotonin are a symptom of stress, depression and anxiety. The issue here is that treating one of the many symptoms of these problems will only mask the cause and will therefore be unable to provide a complete cure.

The main reason why antidepressant drugs are prescribed to people who suffer from stress, depression and anxiety is because a chemical imbalance in the brain is believed to be the root cause. But this is just a theory, there is no evidence to support it whatsoever. A chemical imbalance is just one of the many symptoms involved. All antidepressant drugs do is to treat one symptom. What’s astonishing is that there is no test to determine the levels of the imbalance. Treating the symptoms will not provide a cure, the only way to cure stress, depression and anxiety is to treat the ROOT CAUSE, harmful and flawed modes of thinking.

If you’re taking an antidepressant and it isn’t working, you will be told that:

“some drugs are more effective than others. What works on one person may not be as effective with another. That’s why doctors repeatedly change the type of drug. It’s simply a matter of finding the drug that is right for you.” This simply isn’t true. There are other factors - tolerance to a drug, dosage of a drug and the simple fact that chemical imbalances aren’t the root cause of your anxiety or depression. Tellingly, Yale University has published results showing that for 70% of people, antidepressant drugs are totally ineffective. Other treatments, especially cognitive therapy, are far more effective.


The end of February 2008 the truth came out about the initial studies done on these new SSRI antidepressants. These studies had never before been made public or even submitted to the FDA for their review. Yet these studies showed that the drugs were of no more benefit than a placebo! What the FDA does is judge the “Risk to Benefit” ratio for all drugs. With this new information, our question to them now is: If this group of drugs are of no more benefit than a sugar pill and yet now have an FDA imposed Black Box Warning for increased risk of suicide - the next closest thing to banning a drug and they have warnings of suicide, hostility or psychosis with any abrupt change in dose, where is the Risk to Benefit ratio other than down the toilet? Why are these drugs still on the market with little to no benefit and so great a risk?

Not into pills? Neither am I.  Check out THIS VIDEO.

Here’s what the EXPERTS SAY:

Stress, anxiety and depression blight the lives of millions of sufferers every year. As well as affecting mental health, these illnesses also affect physical health so let’s now look at 3 key stress management skills to help you cope effectively with these problems.

1. You have power - When you’re under stress, a feeling of being helpless can creep in. One can start to believe that everything you do is pointless and that nothing will ever change. When you are confronted with a stressful event, it is vital to keep perspective. E.g. You spit-up from your spouse and you begin to feel as though your entire life is a mess. This has the effect of allowing one problem to have an influence on all parts of your life. Even though it is a stressful problem, only a single area of your life will be affected. Relationships with family and friends, your job, and your social life can carry on as normal. Such a sense of perspective will enable you to keep control of the problem and prevent it affecting all areas of your life instead of a sense of helplessness.

2. Maintain contact - A strong feeling of wanting to be alone is a harmful symptom common to stressful illness. You keep your problems to yourself, you start to avoid the company of others and soon, you begin to retreat into your own world. Isolating yourself in this way makes you feel even worse so it’s critical to avoid this, even though the urge to be alone maybe very strong. Stay in regular contact with one or two people who are supportive and understanding of you and who you can talk to when you need to. Just inviting a good friend over to watch a film or listen to some music, sharing their company like this is crucial. Sharing problems with someone you trust will generate new solutions and fresh approaches and will considerably reduce stress and anxiety.

3. You’re worth it - Low self-confidence is one more symptom experienced by sufferers of stress, depression and anxiety. When you feel so stressed that you can’t handle the situations facing you, your confidence levels soon plummet. To maintain your self esteem, treat yourself to some of the nicer things life has to offer - watching a play, dining out, shopping for new clothes etc. as frequently as you can. I once dated a great girl who’d had to overcome a very difficult situation and she enjoyed going to the theater and dining out often and she always wore really smart clothes. She said: “I do nice things not because I’m seeking approval but because I like doing nice things and I’m worth nice things”. One sentence but so much power! Believing that you can enjoy the nicer things life has to offer because you deserve them will help you to maintain your self esteem.

Here’s my natural remedy:

To keep DEPRESSION, panic attacks and STRESS in check WHILE WAITING for my retirement savings to run out - I keep active at the health club, fly up north to visit my elderly mom, and volunteer helping people WORSE OFF than me.


Why Stress Makes You Miserable


By Gisela Tellis
Science Magazine
June 25, 2012

Stress really does mess with your mind. A new study has found that chronic stress can create many of the brain changes associated with mood disorders by blocking a gene called neuritinand that boosting the gene’s activity can protect the brain from those disorders. The results provide new insight into the mechanisms behind depression, anxiety, and bipolar disorder, and could offer researchers a novel target for drugs to treat those conditions.

Research has shown that mood disorders take a toll on patients’ brains as well as on their lives. Postmortem studies and brain scans have revealed that the hippocampus (the brain’s memory center) can shrink and atrophy in people with a history of depression and other mood disorders. People who live with mood disorders are also known to have low levels of brain-derived neurotrophic factor (BDNF), a growth factor that keeps neurons healthy. They also have low activity in the neuritin gene, which codes for a protein of the same name that may protect the brain’s plasticity: its ability to reorganize and change in response to new experiences.

Ronald Duman, a neurobiologist at Yale University, and colleagues wondered if the poorly understood neuritin might play an important—and heretofore overlooked—role in depression and other mood disorders. They induced depression in a group of rats by subjecting them to chronic, unpredictable stress. Depriving them of food and play, isolating them, and switching around their day/night cycles for about 3 weeks left the rats with little interest in feeding or enjoying a sweetened drink. The rats also gave up and became immobile instead of swimming when placed in a tub of wateranother measure of rodent depression.

All of the depressed rats showed low levels of neuritin gene activity, and all improved when treated with antidepressants. But boosting their neuritin protein levels helped just as much, the researchers report online today in the Proceedings of the National Academy of Sciences. The team found that increasing production of neuritin by injecting the rats with a virus that triggered the gene’s expression protected the rats from brain cell atrophy and other structural brain changes seen in mood disorders, even when the rats were exposed to chronic stress.

“Neuritin produced a response that looked exactly like an antidepressant,” says Duman. “I was surprised to find this molecule was sufficient, by itself, to block the effects of stress and depression.”

To further confirm neuritin’s role, the researchers blocked the activity of the gene in another group of rats without stressing them out. The rodents exhibited the same symptoms of depression as stressed rats.

The results add to a growing body of evidence that implicates stress in the development and progression of mood disorders, and it suggests that compounds mimicking neuritin’s action as another way to treat them, says John Neumaier, a psychiatrist and neuroscientist at the University of Washington, Seattle, who was not involved in the work. “This is a great study, one that uncovers another layer in the biology of depression and antidepressants,” he says. “It opens up a new therapeutic target.”

That target is much-needed, adds neurobiologist Scott Russo of the Mount Sinai School of Medicine in New York City. Only about 30% of people with mood disorders achieve full remission on EXISTING ANTIDEPRESSANTS, Russo says, “and there’s been a fundamental failure to turn new discoveries into new drugs we can use in clinical practice if someone is willing to take the risk and the financial responsibility, neuritin could be a good approach.”



When Depression Drugs Don’t Help, Talking Might
By Rachael Rettner
December 6, 2012

Talk therapy may be a helpful supplemental treatment for people with depression who have not responded to medication, a new study from the United Kingdom suggests.

Researchers found that people with depression who had not improved despite taking antidepressants were three times more likely to experience a reduction in their depression symptoms if talk therapy was added to their treatment regimen compared with those who continued to take only antidepressants.

The study is one of the first large trials to test the effectiveness of talk therapy given in tandem with antidepressants, the researchers said.

Up to two-thirds of people with depression dont respond fully to antidepressant treatment, and the findings suggest a way to help this group, the researchers said.

“Until now, there was little evidence to help clinicians choose the best next step treatment for those patients whose symptoms do not respond to standard drug treatments,” study researcher Nicola Wiles of the University of Bristol’s Centre for Mental Health, Addiction and Suicide Research said in a statement.

The study followed patients for one year. Future studies should examine the effectiveness of this treatment combination over the long term, as patients with depression can relapse after treatment, the researchers said. 

In addition, because some patients did not improve substantially when talk therapy was added, further research is needed to find alternative treatments for this group, Wiles added.

The study included about 470 people with depression who had not responded to antidepressants after six weeks of treatment. About half received cognitive behavioral therapy a type of talk therapy - in addition to their usual antidepressant treatment, and half continued antidepressants without the addition of talk therapy.

After six months, about 46 percent of patients in the talk therapy group experienced at least a 50 percent reduction in their depressive symptoms. By contrast, 22 percent of people in the antidepressant group improved by the same amount. By the 12-month mark, both groups experienced similar rates of improvement.

Often, talk therapy is more difficult to access than medication, the researchers said. And people may not be able to afford the treatment if their health insurance does not cover it. Only about 25 percent of Americans with depression have received talk therapy during the past year, they said.



Proof that Your Own Thoughts and Beliefs Can Cause Self-Healing

By Mr. H.
March 1, 2013

If you are struggling with any major health concern, it is important to realize that your mind can sometimes be your own worse enemy, or it could be the main reason for treating a problem. Increasingly, it is being recognized that a mind over matterђ approach can actually produce noticeable results in your health.

Numerous studies abound on the nature of the mind body relationship, and how your mind can affect your biological functions. Much like how a hypochondriac may convince himself that he is sick, and subsequently findђ (or make up) symptoms of his illness, a negative or even apathetic mindset may induce you into a lesser state of health.

Conversely, having a generally positive disposition or outlook with regards to your health may actually make you healthier. In clinical studies where patients are given placebos, they often will respond positively to them due to the expectation that they are receiving some form of beneficial medicine. Although not talking about placebo sugar pills specifically this kind of self-treatment can be seen in one case where a womans own thoughts made her lose nearly 112 pounds.

What makes these test subjects have a positive response? Definitely not the sugar. An assumed belief that they are being positively affected by whatever they may have been given is what actually causes the change . If this is the case, then it means that your mental state plays a vital role in how your health progresses, or degenerates.

The power of the mind is immense. Its influence can literally bend reality to match its perspective. You can often influence a situation more by thinking about it meticulously, as opposed to simply acting. If you believe something to be true, you will conform the world around you to match this expectation.

If you believe that your illness is getting worse, it will probably get worse. If you believe that your treatment is helping you, you could actually cause massive self-healing to occur. Assuming a disposition will automatically prejudice your mind, and therefore cause your body to react either positively or negatively.

This applies to all things, not just health and wellness. Assuming a positive attitude and an optimistic demeanor will actually help you to overcome your trials in life, whether they are physical, mental, or emotional.


Posted by Elvis on 05/28/12 •
Section Dealing with Layoff
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Sunday, May 27, 2012

The Awakening Part 6


The Oligarchy’s Rule of Law: From Russia to Oklahoma

By Mark Ames
The Daily Banter
May 27, 2012

At the end of the 1990s, after the total collapse of the mass-privatization experiment in Boris Yeltin’s Russia, some of the more earnest free-market proselytizers tried making sense of it all. The unprecedented collapse of Russia’s economy and its capital markets, the wholesale looting, the quiet extermination of millions of Russians from the shock and destitution (Russian male life expectancy plummeted from 68 years to 56 years,) the terrible consequences of imposing radical libertarian free-market ideas on an alien culture - turned out worse than any worst-case-scenario imagined by the free-market true-believers.

Of all the disastrous results of that experiment, what troubled many Western free-market true-believers most wasn’t so much the mass poverty and population collapse, but rather, the way things turned out so badly in Russia’s newly-privatized companies and industries. That was the one thing that was SUPPOSED TO GO RIGHT. According to the operative theorydeveloped by the founding fathers of libertarianism/neoliberalism, Friedrich von Hayek, Ludwig von Mises, Milton Friedman and the rest - a privately-owned company will always outperform a state-run company because private ownership and the profit-motive incentivize the owners to make their companies stronger, more efficient, more competitive, and so on. The theory promises that everyone benefits except for the bad old state and the LAZY.

That was the dominant libertarian theory framing the whole ”SHOCK DOCTRINE” privatization experiment in Russia and elsewhere. In reality, as everyone was forced to admit by 1999, Russia’s privatized companies were stripped and plundered as fast as their new private owners could loot them, leaving millions of workers without salaries, and most of Russia’s industry in far worse shape than the Communists left it.

Most of the free-market proselytizers - ranging from Clinton neoliberal Michael McFaul (currently Obama’s AMBASSADOR TO MOSCOW) to libertarian PINOCHET FABOY Andrei Illarionov (currently with the CATO INSTITUTE) - blamed everything but free-market experiments for Russia’s collapse.

But some of the more earnest believers whose libertarian faith was shaken by what happened to Corporate Russia needed something more sophisticated than a crude historical whitewash.

Lucky for them, Milton Friedman provided THE ANSWER to a Cato Institute interviewer: Russia lacked ”RULE OF LAW - another neoliberal/libertarian catchphrase that went mainstream in the late 80s. Without “rule of law,” Friedman and the rest of the free-market faithful argued, privatization was bound to fail. Here’s Friedman’s answer in the Cato Institute’s 2002 ECONOMIC FREEDOM OF THE WORLD REPORT:

CATO: If we reflect upon the fall of communism and the transition from the centrally planned economy to a market economy, what have we learned in the last decade of the importance of economic freedom and other institutions that may be necessary to support economic freedom?

MILTON FRIEDMAN: We have learned about the importance of private property and the rule of law as a basis for economic freedom. Just after the Berlin Wall fell and the Soviet Union collapsed, I used to be asked a lot: “What do these ex-communist states have to do in order to become market economies?” And I used to say: “You can describe that in three words: privatize, privatize, privatize.” But, I was wrong. That wasn’t enough. The example of Russia shows that. Russia privatized but in a way that created private monopolies - private centralized economic controls that replaced government’s centralized controls. It turns out that the rule of law is probably more basic than privatization. Privatization is meaningless if you don’t have the rule of law. What does it mean to privatize if you do not have security of property, if you can’t use your property as you want to?

Others expanded on Friedman’s rationalization, arguing that without this “rule of law” to protect their private property, the new private owners of Russia’s industries were incentivized to plunder their companies as quickly as possible for fear that the state would steal their companies back. Of course, all this rationalizing was undermined by fact that Russia’s oligarchs stole their companies in the first place, and thieves do tend to steal what they’ve stolen. But never mind - the libertarian ideology was salvaged, as Russia’s privatization experiment was declared “not a real free-market” without Friedrich Hayek’s “rule of law” in place.

The reason I’m bringing this up now is because over the past month, one of America’s most rapacious oligarchs, Aubrey McClendon, was exposed by Reuters for plundering Chesapeake Energy, the second-largest natural gas producer in the country after Exxon-Mobil. McClendon, co-founder, CEO and until a few weeks ago Chairman of Chesapeake, was discovered running a hedge fund inside of Chesapeake, personally profiting on the side from large trading positions that his public company Chesapeake took in the gas and oil markets.

Reuters also discovered that McClendon took small personal stakes in natural gas wells bought by Chesapeake, then borrowed against the wells’ reserves from the same banks that Chesapeake borrowed from - basically, the banks kicked back sweet lending deals to McClendon on the side as McClendon arranged less-than-sweet loans to his publicly-owned company, Chesapeake, kicking profits from Chesapeake’s shareholders and employees’ pockets into the banks and into Aubrey’s accounts.

The loser in all this, as always: Employees, retirees, and shareholders. As Reuters reported, Chespeake is one of a small handful of companies whose employee 401k RETIREMENT packages consist mostly of Chesapeake stock, and the company requires employees to hold on to their stock for the maximum amount of time allowed by law:

Thousands of Chesapeake workers have retirement portfolios that are heavily invested in Chesapeake stock, which has declined sharply following revelations about Chief Executive Aubrey K. McClendon’s business dealings.

But while retail and institutional investors have sold the stock, employees don’t always have that option.

It’s not the first time McClendon has been caught plundering Chesapeake at the expense of shareholders, pension fund investors and employees: In 2008, McClendon bet and lost about $2 billion worth of Chesapeake Energy stock he owned - 94% of Aubrey’s personal stake in Chesapeake on a margin call when natural gas prices collapsed. Aubrey bet that natural gas prices would continue soaring, you see.

But like his peers in the oligarchy class, Aubrey’s loss became everyone but Aubrey’s loss: He was awarded a “CEO bailout” by his board of directors, who honored Aubrey with a $75 million “bonus” to bring his total pay in 2008 to $112 million, making Aubrey McClendon the highest-paid CEO in Corporate America that year. Even though Chesapeake’s earnings dropped in half, and its stock fell 60%, WIPING OUT up to $33 billion in shareholder wealth.

Now, we’re learning, Aubrey was profiting in other ways off of Chesapeake that same year.

There is so much more to hate about Aubrey McClendon than this - the millions McClendon poured into Gary Bauer’s gay-bashing outfit “Americans United To Preserve Marriage” and the Swift Boat Veterans for Truth, the role McClendon and his Whirlpool heiress wife played in STEALING waterfront land from Benton Harbor, an African-American slum and the poorest city in Michigan, in order to expand an exclusive golf course country club for residents of St. Josephs, where McClendon owns several plots of land. McClendon’s wife, Katie, is from St. Joseph’s; so is Katie’s cousin, Fred Upton, the Republican Congressman from St. Joseph’s. Aubrey and his wife are what pass for royalty (sans noblesse oblige) these days: Katie from the Whirpool fortune, Aubrey an heir to the Kerr-McGee fortune. (If you’ve seen the movie Silkwood, you might remember Kerr-McGee as the company that iced the labor union activist played by Meryl Streep.)

This is just one of many stories about how publicly-traded companies have been and can be transformed into elaborate schemes to LOOT AND STEAL from the public and enrich a tiny handful of oligarchs. We saw this in the 1980s when Reagan deregulated the Savings & Loans, which were quickly transformed into a means of looting, fraud and plunder; we saw it in the 2000s, after the de-regulation of the financial sector.

The problem goes much deeper than Milton Friedman’s “rule of law” fetish. “Rule of law” is just another red herring diversion to provide cover for continued oligarchy plunder, failure and barbarism. The problem is systemic, and more importantly, ideological. We still operate under the same neoliberal/libertarian major premises we inherited from the Hayek-Mises-Friedman era, an ideology that considers notions like “the public good” to be quaint delusions at bestas opposed to today’s still-dominant, still-standing foundational ideology, which says that freedom equals the ruthless pursuit of individual self-interest, the unlimited acquisition of private property and wealth, framed within a cold, dystopian “rule of law.”

That is where the problem starts. That is why, every week, I could tell another story about another Aubrey McClendon or Dick Parsons, and it will never end until the ideology that enables them is buried.

Would you like to know more? Read previous “Class Warfare” columns by Mark Ames including “Failing Up With Citigroup’s Dick Parsons” and “The One-Percent’s Doctrine For The Rest Of Us: We Are Not Human Beings, But Livestock Whose Meat They Extract As ‘Rent’”.

Mark Ames is the author of Going Postal: Rage, Murder and Rebellion from Reagan’s Workplaces to Clinton’s Columbine.



The Poverty of Nations

By Robert Hunziker
Firebrand Magazine
May 27, 2012

There is plenty of wealth to go around in the world, but its tied up in too few hands for democratic capitalism to operate efficiently for society at large. Thus, in order to maintain civil order, totalitarianism increasingly becomes a byproduct of this conundrum.

According to the Forbes 2011 survey of billionaires, they hit all-time new records for total wealth and numbers (the total count of billionaires is 1,210), thanks to reverse Robin Hood taxation policies that impoverish government coffers, i.e., Federal Tax Receipts, whilst transferring those dollars, via a doctored tax code, into the pockets of tens of thousands of millionaires and billionaires. The total count of what Forbes refers to as High Net Worth Individuals is 871,000 people worldwide worth over $30 million each, implying total wealth of $26-to>$50 trillion; $26 trillion is nearly twice the size of the U.S. economy.

Wealth creation has increasingly become the key measurement of capitalismҒs efficacy ever since Adam Smiths magnum opus An Inquiry into the Nature and Causes of the Wealth of Nations (1776) aka: The Wealth of Nations, wherein he expounds upon how rational self-interest and competition lead to economic prosperity for society at large, American industry and government have been guided by these free-market principles. For over 200 years, with bumps & lumps along the way, prosperity reigned, and Adam Smith would be smiling. But, for reasons he describes within his own treatise, Adam Smith would be frowning today because of the sorry state of capitalistic nation-states.

Again and again, Smith warned the general public that a true laissez-faire economy could become a conspiracy of business and industry scheming to influence politics and legislation against the best interests of the consuming public.

Smith, the father of economics and the prophet of capitalism is idolized by capitalists the world over; however, he would not recognize todayҒs democratic capitalism because his greatest concerns about conspiracies scheming to influence politics, undermining his theory, have come to fruition. As a result, capitalism is a failed institution for society at large. Rather, it has morphed into a quasi-totalitarian plutocratic nation-state that resides within a hollow shell of democracy.

Smiths economic principles depend upon freedom of markets translating into prosperity for “society” at large. His is a broad view of economic consequences. However, economic results, especially over the past three decades, have increasingly narrowed, funneling riches into fewer hands and penalizing society at large, i.e., the broad middle/working classes, accomplished by the political Right’s adoption of neoliberal principles, and these principles have largely been adopted by both political parties. Therefore, both Democrats and Republicans are at fault for the disastrous state of capitalistic democracy and the subsequent evolution into a quasi-totalitarian state ruled by an elite plutocracy.

How did this happen?

Ever since President Reagan and PM Thatcher, in the 1980s, blessed the policies of: (1) deregulation, particularly financial deregulation, (2) privatization, (3) minimalist government, and (4) diminishment of unions, the world of capitalism has spun out of control and into the hands of neoliberal theory & practice, embracing, and enlarging upon Reagans and Thatcher’s policies to the point of sky-is-the-limitӔ engineering of legislation and policy in favor of only the rich, protected by an increasingly authoritarian state.

Coincidentally, in the mid 1980s, Americas finance, insurance, real estate (FIRE) sector of the economy overtook manufacturing as the major contributing sector to U.S. Gross Domestic Product. Today, FIRE is twice as large as manufacturing.  The upshot is financial interests, as the predominate sector of the economy and working hand-in-glove with neoliberal themes, mold U.S. legislation in their favor.

Additionally, in the eighties, the most significant tax legislation in generations occurred with the Tax Reform Act of 1986, removing numerous tax loopholes and lowering taxes across the board, a reform that was broadly embraced by America. Since then, over 15,000 changes have legislated a Reverse Robin Hood tax code crowned by George W’s tax cuts, designed like a subprime mortgage, i.e., designed to make people see certain good things and not recognize the fine print where the devil is in the details, worth vast amounts to the wealthy but worth very little to everybody else these changes in estate taxes, top tax rates, capital gains, and dividends, further enrich the wealthy beyond imagination!

As explained by Jacob S. Hacker and Paul Pierson in Winner-Take-All-Politics, Simon & Schuster, 2010,Step by step and debate by debate, our public officials have rewritten the rules of the economy in ways that favor the few at the expense of the many.  By gradually making changes over the past 30 years, and supercharged by W, the rich have been put on wealth-creation testosterones like never before, laying the groundwork for just six members of the Walton family, whose patriarch founded Wal-Mart, to have as much wealth as the bottom 30 percent of the entire U.S. population.

Today, the United States is controlled by a small cadre of super wealthy families, spearheaded by innocuous-sounding tax-free organizations like Americans for Tax Reform, founded in 1985, headed by America’s most powerful conservative voice, Grover Norquist. The entire Republican Party pays homage to Norquist, and he, in turn, takes his marching orders from the wealthy families who operate behind the curtain, the Wizards of Oz of Americas quasi-totalitarian state.

According to Chris Hedges, Truthdig, March 26, 2012, “Totalitarian systems always begin by rewriting the law. The defense of freedom and truth becomes a crim… Citizens are colonized. And it is always done in the name of national security.”

Last year President Obama signed the National Defense Authorization Act (NDAA), which act negates the writ of habeas corpus, the most powerful cornerstone of civil rights since the Magna Carta. Every English-speaking jurist since the 12th century must have turned over in the grave. Subsequently, May 2012, U.S. District Judge Katherine B. Forrest overruled the domestic military detention provisions of the act, an act that was roundly supported by Democrats and Republicans. This is a clear, and extremely troubling, clarion call for how far off course democracy has strayed.

Praise the likes of Chris Hedges as an offset to our spineless press corps and weak-kneed politicians, who, on a daily basis, supplicate for morsels of Newspeak at the White House Briefing Room.  Unfortunately, AmericaӔs only defense against a surge towards complete totalitarian control by the plutocrats, the Democratic Party, has proven helplessly weak, and seemingly, frightened by its own shadow, e.g., the democrats completely blew it even when they had control of the presidency and the Congress.

The very fact that Hitlerian enactments like the National Defense Authorization Act are legislated absent out-and-out sweeping objections by the national news, and pass with strong bipartisan support, is clear evidence the country is numb to the threat of totalitarian impulses. A couple hundred years ago, this inane act would have been cause clbre for revolution.

Throughout history, access to a proper understanding of the state of affaires, when tainted, has always worked in favor of mass revolutions against the prevailing order. The French Revolution, for example, is indebted to Claude FauchetҩȒs weekly addresses to crowds of 5,000-8,000 people at the Palais Royal, lecturing on Jean-Jacques Rousseaus 1762 work, The Social Contract with follow up discussions about a more equitable distribution of wealth. The American Revolution is likewise indebted to pamphleteers like Samuel Adams, Thomas Paine, and Patrick Henry, todayҒs heroes but yesteryears street activists.

However, it is improbable that Adams, Henry, and Paine could operate in the same fashion today as they did 200 years ago. The USA Patriot Act would likely stop them dead in their tracks. This Act is riddled with nebulous provisions that leave the doors wide open for the government to take whatever action it deems necessary, depending upon the subjectivity of the enforcer(s).

More than likely, the three Founding Fathers would be classified as terrorists and thrown in jail. Adams’ “Committees of Correspondence,” which served as a shadow government opposed to the British, disseminated seditious information.  Henry was one of the most outspoken exponents of revolution in defense of historic rights. Paines Common Sense pamphlets preached revolution and independence. These men, revered as America’s Founding Fathers, prove the adage: “timing is everything.”

Those Founding Fathers, without a doubt, today would register as rapidly blinking lights within the National Security Agencys (NSA) Utah Data Center, scheduled to open in 2013, which is a heavily fortified $2 billion project of immense secrecy. Its purpose will be to intercept, decipher, analyze, and store vast swaths of the world’s communications. This is finally the completion of the infamous “total information awareness” program created by George W’s henchmen but blocked by Congress in 2003.

The NSA data center will store and analyze private emails, phone calls, Google searches, parking receipts, travel itineraries, bookstore purchases, etc. Plus, it’s The Big Enchilada of spying; the NSA data center is a code-breaker, able to de-encrypt financial information, stock transactions, business deals, diplomatic secrets, legal documents, and any transmission that is encrypted. This is Big Brother come to life. The old insider NSA saying, “Never Say Anything” is now more apropos than ever before. Most likely, this will put many of worlds terrorists in unemployment lines, but what about average citizens? How do they protect themselves in a hollowed democracy?

Christopher Hedges (Democracy Now interview May 17, 2012 by Amy Goodman) believes taking to the streets and revolutions are inevitable, but as he says, the Stamp Act took place in 1765, ten years before the American Revolutionary War (1775-83.) In other words, revolutions take a long time to develop; however, that was then. Today, revolutions can happen overnight, witness the Arab Spring spontaneous combustion is in vogue.

Revolution, or not, there is good news as a result of the 2008-09 worldwide financial meltdown. This scrape with Armageddon has focused the attention of the world on the cozy relationship of Wealth, Wall Street, the Fed, Congress, and the Presidency. Collaterally, it has focused attention on inequities and the rise of plutocracy, including neoliberal policies, e.g. austerity, as practiced by the EU and IMF and World Bank, resulting in hundreds of thousands of people in capitals around the world openly demonstrating and sloganeering against Austerity, Big Banks, Wall Street, and the Wealthy.

Capitalism is at war, being fought in the streets.  The massive demonstrations around the world the past couple of years are not for naught. When tens/hundreds of thousands of citizens take to the streets, as in Madrid, Paris, Athens, Manhattan, Hadramout, Moscow, Montreal, Santiago, and London over time, things happen! People do not stand in the cold, in the rain, in the harsh elements for the fun of it… out of the blue, untoward things happen very unexpectedly!

Thus, capitalisms bankrupt failure to provide for its citizens at large is on display for the world to see, and this failure is, in large measure, caused by the misallocation of “The Wealth of Nations,” leaving “The Poverty of Nations” in its wake.

Whether the nuts and bolts of effective totalitarian control by plutocrats can effectively deal with a degenerating world that is increasingly split into two distinct camps, the rich and the working poor, remains to be seen. Capitalism is not functioning as an institution of socio-economic order for society at large. No, it is failing on all fronts other than with the highest order, the First Estate.

What a strange paradox: Billionaires/millionaires set new all-time records while their capitalist nation-states suffer record debts amidst austerity measures for the middle and working classes.

Is this the Wealth of Nations?

Robert Hunziker, a former hedge fund manager, is a professional independent negotiator for worldwide commodity actual transactions and a freelance writer for progressive publications as well as business journals with several articles published in Counterpunch, The Firebrand Magazine, Z Magazine, UK Progressive Magazine, and Engineering & Mining Journal. Mr. Hunziker earned an MA degree in economic history at DePaul University/Chicago, and he resides in Los Angeles. He can be contacted at .



Stock Market Referendum

In an ever changing world, we need to always re-invent ourselves, and our institutions when they become unbalanced. For many years the Stock Market worked in a good way to help people start up companies, and those who supported that upstart to build a hopeful retirement system. It was never intended to be an end in itself as it has become. In a day and age when CEO’s receive 1000% more than the people who hold stocks, this only leads to less and less opportunity for healthy business practices. In a way, we have allowed CEO’s to become dictators of the finances, and just as we deplore and hate dictatorships in this day and age, we should not look the other way when it is used to give only one person or a small group control of a nation through financial malevolence.

If the stock holders would unite and vote, they can demand, and even force change into a more democratic system. A system that still allows a person to become filthy rich, but also a system that {allows the stock holders} to become wealthy as well. The reason we do not have new companies, and new inventions is because one company has total control. This is not a stock market that will lead us into the long haul, and even in the short term, it is a very disturbing trend. Most people who buy, or invest do not know the power they hold. If I own one thousand shares, I have just as much say at the person who owns one hundred. At least that seems the way it is when ever they release company information and ask for people to vote on issues of what the company should be doing with all this extra money. For some strange reason, people always say: Let the CEO have billions first off the profits?

Who is to say this CEO has any idea what to with that much money? Are they going to invest that money into the community? Can an international CEO have a community, or are they so superior to the rest of us? We do not realize that through proper petitions, we can create ballots, and determine a more ethical system. Why does any one person deserve a billion dollar bonus? Did they make the company, or did the population that buys the product and the stocks? If in reality, it is the people that are making this extra billion in profits, would it not serve all the stock holders to say: Wait! If you have that much extra money, then you need to make it even across the board. If the CEO owns a billion stocks, then they get a billion, yet if a person only owns a hundred, then they deserve a reward for they believe in the company as much as the CEO.

I would hope all people who buy and sell stocks start to make new laws on the way it is run. As of right now, a person or company can buy and sell stocks by the second. This computerized scheme works well for organized pc criminals, but it takes profits from all stock holders. We should return to buying stocks once per day. If a person or even a computer could only buy once a day, {it would stop this crashing} of the stock market. People, and banks would have more time to investigate companies. This slow down would create new jobs as people would create new ways to help regulate banks and other companies. Something that they do not do. With out rules, people can justify using the stock market with impunity. The billion dollar bonus is your tax money. Why should bonuses not be taxed just like tips from a waiter? The laws can always be amended, yet it will take the people who want change to participate.

- Anonymous

Posted by Elvis on 05/27/12 •
Section Revelations
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