Article 43



Wednesday, September 02, 2020

The Bradykinin Hypothesis

image: coronavirus

A Supercomputer Analyzed Covid-19 and an Interesting New Theory Has Emerged
A closer look at the Bradykinin hypothesis

By Thomas Smith
September 1, 2020

arlier this summer, the Summit supercomputer at Oak Ridge National Lab in Tennessee set about CRUNCHING DATA on more than 40,000 genes from 17,000 genetic samples in an effort to better understand COVID-19. Summit is the SECOND-FASTEST computer in the world, but the process which involved analyzing 2.5 billion genetic combinations - still took more than a week.

When Summit was done, researchers analyzed the results. It was, in the words of Dr. Daniel Jacobson, lead researcher and chief scientist for computational systems biology at Oak Ridge, a ”EUREKA MOMENT.” The computer had revealed a new theory about how Covid-19 impacts the body: THE BRADYKINKIN HYPOTHESIS. The hypothesis provides a model that explains many aspects of Covid-19, including some of its most BIZARRE SYSPTOMS. It also suggests 10-plus potential treatments, many of which are already FDA approved. Jacobsons group PUBLISHED THEIR RESULTS in a paper in the journal eLife in early July.

According to the team’s findings, a Covid-19 infection generally begins when the virus enters the body through ACE2 receptors in the nose, (The receptors, which the virus IS KNOWS TO TARGET, are abundant there.) The virus then proceeds through the body, entering cells in other places where ACE2 is also present: the intestines, kidneys, and heart. This likely accounts for at least some of the diseases cardiac and GI symptoms.

But once Covid-19 has established itself in the body, things start to get really interesting. According to Jacobson’s group, the data Summit analyzed shows that Covid-19 isn’t content to simply infect cells that already express lots of ACE2 receptors. Instead, it actively hijacks the bodyҒs own systems, tricking it into upregulating ACE2 receptors in places where they’re usually expressed at LOW OR MEDIUM LEVELS, including the lungs.

In this sense, Covid-19 is like a burglar who slips in your unlocked second-floor windowand starts to ransack your house. Once inside, though, they donҒt just take your stuff they also throw open all your doors and windows so their accomplices can rush in and help pillage more efficiently.

The renin-angiotensin system (RAS) controls many aspects of the circulatory system, including the body’s levels of a chemical called bradykinin, which normally helps to regulate blood pressure. According to the team’s analysis, when the virus tweaks the RAS, it causes the body’s mechanisms for regulating bradykinin to go haywire. Bradykinin receptors are resensitized, and the body also stops effectively breaking down bradykinin. (ACE normally degrades bradykinin, but when the virus downregulates it, it can’t do this as effectively.)

The end result, the researchers say, is to release a bradykinin storm a massive, runaway buildup of bradykinin in the body. According to the bradykinin hypothesis, it’s this storm that is ultimately responsible for many of Covid-19s deadly effects. Jacobson’s team says in their paper that the pathology of Covid-19 is likely the result of “Bradykinin Storms rather than cytokine storms,” which HAD BEEN PREVIOUSLY IDENTIFIED in Covid-19 patients, but that the two may be intricately linked. OTHER PAPERS had previously identified bradykinin storms as a possible cause of Covid-19s pathologies.

As bradykinin builds up in the body, it dramatically increases vascular permeability. In short, it makes your blood vessels leaky. This aligns with recent clinical data, WHICH INCREASINGLY VIEWS COVID-19 PRIMARILY AS A VASCULAR DISEASE, rather than a respiratory one. But Covid-19 still has a massive effect on the lungs. As blood vessels start to leak due to a bradykinin storm, the researchers say, the lungs can fill with fluid. Immune cells also leak out into the lungs, Jacobson’s team found, causing inflammation.

And Covid-19 has another especially insidious trick. Through another pathway, the teams data shows, it increases production of hyaluronic acid (HLA) in the lungs. HLA is OFTEN USED IN SOAPS AND LOTIONS for its ability to absorb more than 1,000 times its weight in fluid. When it combines with fluid leaking into the lungs, the results are disastrous: It forms a hydrogel, which can FILL THE LUNGS IN SOME PATIENTS. According to Jacobson, once this happens, “its like TRYING TO BREATHE THROUGH JELL-O.”

This may explain why ventilators PROVEN LESS EFFECTIVE in treating advanced Covid-19 than doctors originally expected, based on experiences with other viruses. It reaches a point where regardless of how much oxygen you pump in, it doesn’t matter, because the alveoli in the lungs are filled with this hydrogel, Jacobson says. “The lungs become like a water balloon. Patients can suffocate even while receiving full breathing support.”

The bradykinin hypothesis also extends to many of Covid-19’s effects on the heart. About ONE IN FIVE HOSPITALIZED COVID-19 PATIENTS have damage to their hearts, even if they never had cardiac issues before. Some of this is likely due to the virus infecting the heart directly through its ACE2 receptors. But the RAS also controls aspects of cardiac contractions and blood pressure. According to the researchers, bradykinin storms could create arrhythmias and low blood pressure, which are often seen in Covid-19 patients.

The bradykinin hypothesis also accounts for COVID-19’S NEUROLOGICAL EFFECTS, which are some of the most surprising and concerning elements of the disease. THESE SYMPTOMS (which include dizziness, seizures, delirium, and stroke) are present in AS MANY AS HALF OF HOSPITALIZED COVID-19 PATIENTS. According to Jacobson and his team, MRI studies in France revealed that many Covid-19 patients have evidence of leaky blood vessels in their brains.

Bradykinin - especially at high doses - can also lead to a ;." rel="nofollow"]BREAKDOWN OF THE BLOOD-BRAIN BARRIER. Under normal circumstances, this barrier acts as a filter between your brain and the rest of your circulatory system. It lets in the nutrients and small molecules that the brain needs to function, while keeping out toxins and pathogens and keeping the brain’s internal environment tightly regulated.

If bradykinin storms cause the blood-brain barrier to break down, this could allow harmful cells and compounds into the brain, leading to inflammation, potential brain damage, and many of the neurological symptoms Covid-19 patients experience. Jacobson told me, “It is a reasonable hypothesis that many of the neurological symptoms in Covid-19 could be due to an excess of bradykinin. It has been reported that bradykinin would indeed be likely to increase the permeability of the blood-brain barrier. In addition, similar neurological symptoms have been observed in other diseases that result from an excess of bradykinin.”

Increased bradykinin levels could also account for other common Covid-19 symptoms. ACE inhibitors - a class of drugs USED TO TREAT HIGH BLOOD PRESSURE - have a similar effect on the RAS system as Covid-19, INCREASING BRADYKINKIN LEVELS. In fact, Jacobson and his team note in their paper that “the virus - acts pharmacologically as an ACE inhibitor… almost directly mirroring the actions of these drugs.

By acting like a natural ACE inhibitor, Covid-19 MAY BE CAUSING the same effects that hypertensive patients sometimes get when they take blood pressure lowering drugs. ACE inhibitors are known to CAUSE a dry cough and fatigue, two textbook symptoms of Covid-19. And they can potentially increase blood potassium levels, which has also been OBSERVED IN COVID_19 PATIENTS. The similarities between ACE inhibitor side effects and Covid-19 symptoms strengthen the bradykinin hypothesis, the researchers say.

ACE inhibitors are also known to cause a LOSS OF TASTE AND SMELL. Jacobson stresses, though, that this symptom is more likely due to the virus “affecting the cells surrounding olfactory nerve cells than the direct effects of bradykinin.”

Though still an emerging theory, the bradykinin hypothesis explains several other of Covid-19;s seemingly bizarre symptoms. Jacobson and his team speculate that leaky vasculature caused by bradykinin storms could be responsible for COVID-TOES, a condition involving swollen, bruised toes that some Covid-19 patients experience. Bradykinin can also MESS WITH THE THYROID GLAND, which could produce the THYROID SYMPTOMS recently observed in some patients.

The bradykinin hypothesis could also explain some of the broader demographic patterns of the diseases spread. The researchers note that some aspects of the RAS system are sex-linked, with proteins for several receptors (such as one called TMSB4X) located on the X chromosome. This means that “women would have twice the levels of this protein than men,” a result borne out by the researchers data. In their paper, Jacobson’s team concludes that this could explain the lower incidence of Covid-19 induced mortality in women.Ғ A genetic quirk of the RAS could be GIVING WOMEN EXTRA PROTECTION against the disease.

The bradykinin hypothesis provides a model that contributes to “a better understanding of Covid-19” and “adds novelty to the existing literature,” according to scientists Frank van de Veerdonk, Jos WM van der Meer, and Roger Little, who PEER-REVIEWED THE TEAMS’ PAPER. It predicts nearly all the disease’s symptoms, even ones (like bruises on the toes) that at first appear random, and further suggests new treatments for the disease.

As Jacobson and team point out, several drugs target aspects of the RAS and are already FDA approved to treat other conditions. They could arguably be applied to treating Covid-19 as well. Several, like danazol, stanozolol, and ecallantide, reduce bradykinin production and could potentially stop a deadly bradykinin storm. Others, like icatibant, reduce bradykinin signaling and could blunt its effects once its already in the body.

Interestingly, Jacobson’s team also suggests VITAMIN D as a potentially useful Covid-19 drug. The vitamin is involved in the RAS system and could prove helpful by reducing levels of another compound, known as REN. Again, this could stop potentially deadly bradykinin storms from forming. The researchers note that vitamin D has already BEEM SHOWN TO HELP THOSE WITH COVID-19. The vitamin is readily available over the counter, and AROUND 20% OF THE POPULATION IS DEFICIENT. If indeed the vitamin proves effective at reducing the severity of bradykinin storms, it could be an easy, relatively safe way to reduce the severity of the virus.

Other compounds could treat symptoms associated with bradykinin storms. Hymecromone, for example, could reduce hyaluronic acid levels, potentially stopping deadly hydrogels from forming in the lungs. And timbetasin could mimic the mechanism that the researchers believe protects women from more severe Covid-19 infections. All of these potential treatments are speculative, of course, and would need to be studied in a rigorous, controlled environment before their effectiveness could be determined and they could be used more broadly.

Covid-19 stands out for both the scale of its global impact and the apparent randomness of ITS MANY SYMPTONS. Physicians have STRUGGLES TO UNDERSTAND the disease and come up with a unified theory for how it works. Though as of yet unproven, the bradykinin hypothesis provides such a theory. And like all good hypotheses, it also provides specific, testable predictions in this case, actual drugs that could provide relief to real patients.

The researchers are quick to point out that the testing of any of these pharmaceutical interventions should be done in well-designed clinical trials. As to the next step in the process, Jacobson is clear: “We have to get this message out.” His team’s finding wont cure Covid-19. But if the treatments it points to pan out in the clinic, interventions guided by the bradykinin hypothesis could greatly reduce patients’ suffering and potentially save lives.


Posted by Elvis on 09/02/20 •
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Tuesday, January 22, 2013

Marvel At The Beast - Part 10


“Obama’s biggest blemish remains the ongoing tragedy of mass unemployment. Not only does this have a human element - the countless lives harmed or destroyed by poverty and desperation - but it is a huge drag on our economy. Mass unemployment reduces spending - the engine of our economy - which in turn, reduces growth. And without meaningful growth, there’s no way to reduce long-term debt without inflicting a large dose of harmful austerity. That, in my view, is unacceptable.”
- Obamas Biggest Blemish, Jamelle Bouie, American Prospect, January 3, 2013

The central problem is not an inadequate supply of educated workers; it is inadequate demand. The Bureau of Labor Statistics now projects that of the ten occupational groups that will add the most jobs between 2010 and 2020, five do not even require a high-school education.
Who Will Save The Middle Class, Prospect, May 2012

I can tell you tell you one thing I like about The President - his speeches are GREAT.
I only wish this time THERE IS SOME REAL SUBSTANCE behind his EMPTY words.


Obama speech reveals a different leader

By Dan Balz
January 21, 2013

President Obama has never lacked for confidence, but rarely has that attribute been on display as clearly as on Monday in an inaugural address that underscored the distance he has traveled after four contentious years in office.

This was not the politician who campaigned in 2008 on themes of transcending the divisive politics of the past, though there were ritual calls for the country and its political leaders to seize this moment together. Instead, it was a president who has accepted the reality of those divisions and is determined to prevail on his terms.

Obamas first campaign was aspirational, and he came to office believing, or at least hoping, that through force of personality he could gently guide the opposing sides to consensus on issues that had long resisted resolution. Monday’s speech conveyed the ambitions of a president looking at his next four years with a sense of frustration and impatience, and who now believes that a different style of leadership is required.

In his speech, Obama set out his priorities for a second term, goals that will cheer the liberal wing of the Democratic Party and probably alarm many on the right. He challenged Republicans to meet him partway, though not exactly in the middle. If there was an underlying message Monday, it was not “Come, let us reason together.” It was “Follow me.” The question is whether he will be any more successful in his second term than he was in his first.

Pressure on Republicans

There are reasons for the president setting a different tone in his second inaugural than in his first. Two years after he and his party took a beating in the midterm elections, he now holds the strongest hand in Washington. His approval ratings have climbed above 50 percent, while his Republican opponents in Congress remain mired in disapproval ratings almost three times as high as their approval ratings.

Obama once hoped that he could overcome the united opposition of congressional Republicans, whose militant House members set the partys tone during the battles of the past two years, through negotiation with GOP leaders. Now he is looking to the country to pressure his opponents to compromise in ways that they would not during his first term.

Republicans have already tested the reelected president and discovered the limits of their power. Their decision not to pick a fight - for now - over the debt ceiling signaled their recognition of that reality. It was an acknowledgment that the tactic of opposing Obama at almost every turn may be self-defeating.

Obama appears ready to try to split the Republican coalition by setting pragmatists against ideologues. On Monday, he rebuked those who have been most aggressive in their opposition when he said, “We cannot mistake absolutism for principle, or substitute spectacle for politics, or treat name-calling as reasoned debate.”

REPUBLICANS will have to choose their battles more carefully, and they may prevail in some cases. Obama knows that he won’t get all he wants, but the balance of power at the start of his second term is far different from what it was 24 months ago.

The year ahead promises more debates over the size and scope of government, issues that dominated the past two years in Washington. Obama acknowledged the need to deal with spending and the deficit, but he also set out terms for the coming fight over federal entitlements.

During the campaign, Obama talked about the philosophical divide between Republicans and Democrats on these issues, as he condemned the broken politics of Washington. He said the American people could break the tie with the election.

But the election returned a majority of Republicans to the House, and on Monday the president seemed to suggest that there were grounds for compromise. “Progress,” he said, “does not compel us to settle centuries-long debates about the role of government for all time, but it does require us to act in our time.”

Addressing his coalition

Obama’s second inaugural address also reflected a changing America and the coalition that reelected him to office. The nation’s first African American president leads an ever-more diverse population and a country in which attitudes and mores continue to change, particularly among the youngest segment of society.

The policy agenda he put forth, and the values he enunciated, spoke directly to that coalition. Never before has a president used an inaugural address to speak so openly about the cause of gay rights, linking the 1969 Stonewall uprising that led to the gay rights movement with Selma and civil rights and the 1839 Seneca Falls Convention and womens’ rights.

Not all Americans agree with these changes, and as president, Obama must attempt to speak for them and to them. But his remarks Monday suggest that he believes history is on his side on these issues.

The president’s second inaugural address was notable also for what he talked about only in brief. Four years ago, he stood on the Capitols West Front with the country facing an economic crisis. Output was falling, the stock market had plunged, many Americans were threatened with housing foreclosures, and unemployment was rising rapidly. He talked about “a sapping of confidence across our land.”

On Monday, he touched only lightly on that crisis and spoke of the economy in positive terms. “An economic recovery has begun,” he said. At a time when jobs remain a top priority for most Americans, he chose neither to highlight that problem nor to offer any new solutions - though, ultimately, he will be judged on his effectiveness in restoring the economy to its full strength.

Opponents will find much to dislike about what Obama said Monday, for this was not a speech aimed at mollifying those who lost the election. Sen. John McCain (R-Ariz.), who lost the presidential race four years ago, expressed disappointment that Obama was not more explicit about bringing the two sides together. “I would have liked to have seen more on outreach and working together,” McCain said. But the senator added, “It’s his privilege to say what he wants.”

Obama risks overreaching or over-interpreting his mandate, which can be an affliction of newly reelected presidents. His victory in November was decisive but not overwhelming. Self-confidence can slip over the line to arrogance or hubris. Second terms often disappoint. So there are dangers ahead for the president.

On Monday, he set out his ambitions for a second term in clear language. What follows will define how history judges both those priorities and his ability to turn them into action.



Politico has a sad because it doesn’t think Obama has done enough to cut Medicare or Social Security

By Jed Lewison
Daily Kos
January 22, 2013


The President has never precisely defined what hard choices he would be willing to make on Medicare and Social Security. Its not even clear what he would do if he had the power to remake the programs on his own, without worrying about opposition from Republicans or Democrats.

How incredibly sad. President Barack Obama just isn’t willing to make hard choices on Medicare and Social Security. And, as everybody knows, with an unemployment rate of 7.8 percent, America’s top priority is making “hard choices” to cut not just those programs, but Medicaid as well.

If only the president had done something courageous, like passing landmark health care reform legislation that will achieve $716 billion in Medicare savings over the next decade. If only he had been willing to take such a step despite the virtual guarantee that the Republican presidential nominee would run ads ATTACKING HIM FOR IT. If only he’d been willing to do something bold, like taking the risk of having Republicans claim that he had created death panels when what he really did was create an Independent Payment Advisory Board aimed at reducing Medicare costs.

But no, our lousy president hasn’t been willing to make any TOUGH CHOICES at all. In fact, as Politico “reports” in the very same article that I quoted above:

Obama infuriated Democrats by proposing controversial changes to Medicare, Medicaid and Social Security during his failed 2011 grand-bargain talks with Boehner. The president was ready to make some entitlement concessions in the fiscal cliff negotiations last month, but that effort fizzled, too.

Wait. Hold on. You mean Obama has proposed additional cuts to Medicare and Social Security?

Now at this point you might be a bit confused, because on the one hand Politico is ripping Obama for being unwilling to cut Medicare, Medicaid, and Social Security, but on the other hand, they are pointing out that he angered his own party when he proposed cuts to Medicare, Medicaid, and Social Security. Fortunately, your confusion will be short-lived, because Politico explains why Obama STILL SUCKS. The short version: the tax cliff deal made it impossible for him to get entitlement cuts because Republicans aren’t willing to raise taxes again.

The FISCAL CLIFF DEAL, which raised $600 billion in new revenue, may have actually made it more difficult to strike a grand bargain. That’s because Republicans aren’t willing to consider further tax hikes a White House prerequisite to weighing any controversial cuts to entitlements.

Well, I guess that settles that. As we all know, if Republicans say no to something, then it’s off the table. It should never be considered. Why? Because Republicans said no, that’s why. And when they say no, they mean it. EXCEPT:

A senior Republican tax aide confirmed that Representative Dave Camp of Michigan, the Ways and Means chairman, planned to push forward this year with “revenue-neutral” tax reform, with the revenue target adjusted upward to the amount raised by the higher tax rates on the wealthy approved this month to resolve most of the so-called fiscal cliff.

The Republican aide said if the Senate can approve tax changes that raise revenues, it is possible that difficult negotiations between the two chambers could produce a final deal that would produce more tax revenue - but not as much as the Senate wants.

Huh. Maybe assuming Republicans say what they mean and mean what they say isn’t really the best assumption to make. Maybe it’s time to realize that Republicans like to bluff. And as long as Politico is going to perpetuate its misguided obsession with 20-year budget projections for Social Security, maybe they should give President Obama some credit for having done what they say he refuses to do.

Of course, what would really be nice would be to see the same level obsession on an issue like unemployment and economic growth, or maybe even climate change. After all, the fanciest projection in the world doesn’t mean a damn thing without economic growth. And if we don’t do anything to confront climate change, the only thing we can say for sure about the demographic forecasts for the future of Social Security and Medicare is that they are going to be wrong.



Americas Vanishing Economic Freedom

By Michael D. Tanner
National Review
September 19, 2012

The 2012 Economic Freedom of the World report was RELEASED this week by the Cato Institute and CanadaҒs Fraser Institute, and it showed that the United States has plummeted to 18th place in the ranked list, trailing such countries as Estonia, Taiwan, and Qatar. Even such notorious welfare states as Finland and Denmark, not to mention Canada, have freer economies than we do.

Actually, the decline began under President George W. Bush. For 20 years the U.S. had consistently ranked as one of the worlds three freest economies, along with Hong Kong and Singapore. By the end of the Bush presidency, we were barely in the top ten.

And, as with so many disastrous legacies of the Bush era, Barack Obama took a bad thing and made it worse.

During the past four years, the U.S. saw significant declines in nearly all categories of the economic-liberty index. Most significant - and this should come as no surprise to anyone paying attention - is that the size of government grew substantially, particularly when measured by size of government subsidies and transfers and by government consumption as a share of national consumption.

As recently as 2005, the U.S. ranked 45th in size of government among the 144 nations surveyed. That was bad enough, but it still had us in the top third of the 144 countries surveyed. Today, government has grown dramatically, and our ranking has fallen to 61st place. By the metrics used, the U.S. now has a bigger government than Ukraine or Syria.

The United States has also seen a substantial increase in business regulations, labor-market restrictions, and barriers to trade. Our standing fell in all those categories, and we have undergone a long-term deterioration in ranking on property rights as well.

To anyone wondering why the U.S. is having such a hard time recovering from this recession, the 2012 report provides a pretty devastating diagnosis. We are clearly headed in the wrong direction.

Yet discussion of economic freedom seems curiously missing from the presidential campaign. President Obama, in fact, would further restrict economic liberty. He proposes a host of new subsidies and regulations. And donגt forget that the largest parts of Dodd-Frank kick in next year.

Meanwhile, when it comes to defending economic liberty, Mitt Romney has spent most of his time in a defensive crouch. He occasionally breaks form to promise he wont really reduce taxes on the wealthy, wonҒt cut Medicare, and wants to keep some parts of Obamacare. Hes actually running ads attacking the president for not confronting China over trade.

Americans instinctively know the importance of economic freedom. They know that it is their ability to invest, start businesses, and hire workers that builds a prosperous country. They know that millions have come to this country and prospered because they had freedom to pursue their economic aspirations as well as their personal ones. And they find this freedom now slipping away.

They need a candidate to speak for them҅ and for freedom.


Posted by Elvis on 01/22/13 •
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Friday, January 11, 2013

American Express Lays Off 5,400


American Express to cut 5,400 jobs

By Mr Z.
January 11, 2013

American Express Co. will eliminate 5,400 jobs this year, mostly in travel services, amid a huge decrease in fourth-quarter profit.

The lender posted a 47 percent drop in fourth-quarter profit and recorded after-tax charges totaling $594 million, including costs tied to severance and changes in how the firm estimates future redemptions of credit-card rewards, New York- based AmEx said Thursday in a statement.

“Travel has gone through a great deal of change,” Chief Executive Officer Kenneth I. Chenault said in a conference call with analysts. T"he economics of corporate travel has changed more dramatically over the years than any part of the business.”

American Express, the biggest U.S. credit-card issuer by purchases, also provides clients worldwide with travel-booking and advisory services. Competitors include Internet firms, the most valuable online-travel agency, and Expedia Inc.

The lender reported preliminary results ahead of its formal earnings announcement scheduled for Jan. 17. In the third quarter, travel commissions and fees declined 3.1 percent to $465 million from a year earlier, according to an Oct. 31 regulatory filing.

Fourth-quarter net income declined to $637 million from $1.19 billion a year earlier, according to the company. Adjusted profit, which excludes one-time items, was $1.09 a share, 3 cents more than the average estimate of 27 analysts surveyed by Bloomberg. The after-tax charges include $287 million in severance costs and $212 million tied to changes in how the firm calculates redemptions. Bloomberg


There are over 20 million people who are either unemployed or have stopped looking for work in the United States.

While the economy, in fact, is growing again the recession officially ended in June 2009 - just a third of Americans see it that way. They’re outnumbered by the 44% who say it’s in a recession or a depression. USA Today

The advance figure for seasonally adjusted initial claims for jobless benefits was 372,000 in the week ending Dec. 29, up 10,000 from the previous weeks revised figure. Meanwhile, the four-week moving average, which helps smooth out week-to-week volatility, also edged up to 360,000. Xinhua

Due to the “dysfunction and polarization in Washington, the U.S. economy faces a prolonged weak outlook,” according to Mohamed El-Erian, Chair of the president Obama’s Global Development Council. “The new normal is sluggish growth and persistently high unemployment and concerns about debt and deficits,” El-Erian said. CNBC.


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Wednesday, January 02, 2013

Minimum Wage 2013

Nearly 1 million U.S. workers will be getting a New Years Day gift: a small raise after 10 states boost their minimum wages.

By Jim Malewitz, Staff Writer
Pew - Stateline
December 20, 2012

Nine states will adjust the wages to accommodate the rising costs of living, as required by state laws, while Rhode Island will implement a law signed by the governor in June that raises its minimum wage to $7.75 per hour. The wage hikes range between 10 cents and 35 cents per hour, adding between $190 and $510 to the average affected workers annual pay.

min-wage-2013.png border=0

With those changes, 19 states and the District of Columbia will have minimum wages above the federal level of $7.25, which translates to about $15,000 per year for a full-time worker. That rate has been in place since 2009 and has not been adjusted for inflation.

The National Employment Law Project, an advocate for workers’ rights, is among several groups calling for lawmakers to boost the federal rate.

“We need policies that make sure workers earn wages that will at the very least support their basic needs,” Christine Owens, the labor groups executive director, said in a statement Wednesday (December 19). “But earning an income that meets basic needs shouldn’t depend on the state where a working family lives.”

U.S. Senator Tom Harkin, of Iowa, introduced a bill last July that would raise the minimum wage to $9.80 by 2014 and adjust it each year. But the legislation has little chance to pass in a divided Congress still wrangling over budget issues.

Meanwhile, New Jerseys Democrat-controlled legislature passed a bill early this month that would raise wages, currently at the federal minimum, by a dollar. Governor Chris Christie, a Republican, will likely veto the measure, saying it would burden businesses still recovering from Superstorm Sandy. Anticipating a veto, leaders of both houses have said they will push a constitutional amendment. That would require both chambers to pass the legislation next year. Voters would then weigh in during the 2013 election.

A battle is also brewing in California, where the state’s $8-per-hour minimum wage has remained the same for five years. Assemblyman Luis Alejo, a Democrat, is pushing a bill that would gradually raise the wage to $9.25 by 2016. The last attempt to adjust the states minimum wage in 2011 met strong pushback from the business community and ultimately failed.

Questions about the minimum wage have long sparked debate among lawmakers. Supporters say wage hikes help workers keep pace with inflation, spurring more spending that boosts the economy at large. Opponents argue the higher wages increase employers’ costs, forcing them to cut workers.

In 2010, a study of restaurant worker salaries, published in the Review of Economics and Statistics, “found no detectable employment losses from the kind of minimum wage increases we have seen in the United States.”


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Monday, October 08, 2012

Bad Moon Rising Part 52 - Huawei


The Capitalists will sell us the rope with which we will hang them.
- Lenin

One Friday morning about ten years ago - not soon after a big LAYOFF of IT jobs AT&T OUTSOURCED TO IBM, WHO OFFSHORED THEM TO INDIA - I called the helpdesk to open a trouble ticket - reporting I couldn’t connect to a bunch of network resources. The heavily-accented, English-challenged IT guy directed me to a memo reminding everyone that starting 10 PM Friday night a bunch of systems will be taken down over the weekend for software maintenance. What wasn’t mentioned was the time difference between our two countries.  To the guy out there on the other side of the phone - and planet - it was Friday night. My colleagues and I TWIDDLED OUR THUMBS THE REST OF THE DAY BECAUSE WE COULDN’T LOG IN to the systems we needed to do our work, while MANAGEMENT PATTED THEMSELVES ON THE BACK FOR CUTTING COSTS, and the highly-skilled former American IT workers put in for their next unemployment checks.

There’s another frightening message here besides the layoff of America’s professional IT workforce - command and control of the IT infrastructure of the United States’ largest phone company - a national security asset - is off American soil, and therefore - under some other country’s control.

An even more alarming thing happened when the US company that makes the bulk of AT&T’s telecom equipment - Lucent Technologies and BELL LABS was bought by French company ALCATEL six years ago.  Besides Americans selling away civilization’s most advanced telecommunications technology - the NEW OWNERS have a philosophy of MOVING WORK TO LOW COST COUNTRIES - which also means jobs out of America - even after the American workers, CWA UNION, and US GOVERNMENT were willing to make big concessions to keep the work here and be competitive in the global market. Alcatel-Lucent’s FRENCH management INSISTED on CLOSING US FACTORIES, and building new ones in places like CHINA and Italy.  Their ENTIRE IT OPERATION WAS OUTSOURCED TO HEWLETT PACKARD.  Want to guess where their Network Operations Centers are? One is in France.  Here’s an easier question.  Name a country where the Network Operations Centers aren’t?

Of all the labels on the crates we got filled with freshly manufactured bleeding edge ALCATEL-LUCENT LTE EQUIPMENT - just one shipping label was in English - everything else in a foreign language - I guess Chinese.  Want to talk to tech support about Alcatel-Lucent’s voicemail product?  Then you may be talking to someone in Poland. When you call Alcatel-Lucent for technical support on what used to be an export-controlled American national security asset - the 5ESS switch - last I heard that support was in China.  Ditto for the OMP FX wireless switch.  And the next gen stuff. The former sprawling LUCENT CAMPUS IN NAPERVILLE ILLINOIS that used to house the company’s support folks, research and development, is all but gone. Lucent’s best and brightest technology people have been layed off like their equally highly-experienced and highly-trained professional cousins at NASA - retraining for EXCITING NEW CAREERS in the NEW THIRD WORLD AMERICAN ECONOMY to be bus drivers, and doormen at the Hilton.

Then we have utter poor judgement of management I wrote about on the preface to THE ATHENS AFFAIR - putting America’s telephone infrastructure at even more risk, by people in power blinded by ignorance and dollar signs.

Back at my Lucent days we used to laugh about the Chinese stealing our trade secrets because their digital transmission equipment had the same software bugs as ours.

Boy have times changed.

Today - not one TRANSATLANTIC CABLE is OWNED by a US carrier.  I think TATA of India bought the last one from us a few years ago.

Selling Bell Labs and Lucent in 2006 to foreigners was a forgotten moment in US history.  The company’s subsidiary - LUCENT GOVERNMENT SOLUTIONS - is a sobering reminder of what’s going on, along with AT&T outsourcing it’s IT infrastructure, or US carriers selling every TAT cable to foreigners. These expressions that capitalism trumps all - even national security - are a lot scarier to me than fear mongering about HUAWEI and CHINESE TELECOM MANUFACTURERS, that our friends at 60 Minutes did a piece on last night.

Like the guy says at the end of the Forbes article - “It’s much easier to bash China.”


Huawei probed for security, espionage risk

By Steve Kroft
60 Minutes
October 7, 2012

If you’re concerned about the decline of American economic power and the rise of China, then there is no better case study than Huawei. Chances are you’ve never heard of this Chinese technology giant, but in the space of 25 years it’s become the largest manufacturer of telecommunications equipment in the world; everything from smart phones to switchers and routers that form the backbone of the global communications network. It’s an industry the U.S. invented and once dominated, but no more.

Now, Huawei is aggressively pursuing a foothold in the United States, hoping to build the next generation of digital networks here. It’s prompted an outcry in Washington, and a year-long investigation by the House Intelligence Committee that has raised CONCERNS about national security, Chinese ESPIONAGE, and Huawei’s murky connections to the Chinese government.

Huawei’s world headquarters is located on this sprawling Google-esque campus in Shenzhen, not far from Hong Kong. China’s first international conglomerate is a private company, ostensibly owned by its 140,000 employees, but exactly how that works and other details of corporate governance are closely held secrets.

What we do know is that Huawei is now the world leader in designing and building fourth generation communication networks, known as 4G, the latest technology for moving high volumes of phone calls, data, and high definition video. Its innovative low cost systems have already captured markets in Africa, Latin America and Europe.

Now with Huawei eyeing potential customers in the U.S., congressional leaders and the national security establishment are doing everything they can to prevent it from happening.

Steve Kroft: Do we trust the Chinese?

Mike Rogers: IF I WERE AN AMERICAN COMPANY today, and I’ll tell you this as the chairman of the House Permanent Select Committee on Intelligence, and you are looking at Huawei, I would find another vendor if you care about your intellectual property, if you care about your consumers’ privacy, and you care about the national security of the United States of America.

Republican Congressman Mike Rogers and the ranking Democrat on the House Intelligence Committee, Dutch Ruppersberger, believe that letting a Chinese company build and maintain critical communication infrastructure here would be a serious mistake.

Dutch Ruppersberger: One of the main reasons we are having this investigation is to educate the citizens in business in the United States of America. In the telecommunications world, once you get the camel’s nose in the tent, you can go anywhere.

Their overriding concern is this: that the Chinese government could exploit Huawei’s presence on U.S. networks to intercept high level communications, gather intelligence, wage cyber war, and shut down or disrupt critical services in times of national emergency.

Jim Lewis: This is a STRATEGIC INDUSTRY. And it’s like aircraft or space launch, or computers, IT. It’s a strategic industry in the sense that an opponent can gain serious advantage, can gain serious benefit from being able to exploit the telecommunications network.

Jim Lewis has followed Huawei’s explosive growth for years from the State Department and the Commerce Department, where his job was to identify foreign technologies that might pose a threat to national security.

Steve Kroft: How did they get so big and so cheap, so quickly?

Jim Lewis: Two answers. First, steady, extensive support from the Chinese government. If you’re willing to funnel hundreds of millions, maybe even billions of dollars to a company, they’re going to be able to grow. The second reason is INDUSTRIAL ESPIONAGE. And Huawei was famous in their developing years for taking other people’s technology.

Steve Kroft: You mean stealing?

Jim Lewis: I guess technically, yes, it would be theft.

Cisco accused Huawei of copying one of its network routers, right down to the design flaws and typos in the manual. And Motorola alleged that Huawei recruited its employees to steal company secrets.

Both cases were settled out of court. But the Pentagon and the director of National Intelligence have both identified Chinese actors as the world’s most active and persistent perpetrators of economic espionage.

Bill Plummer: Huawei is Huawei. Huawei is not China.

Bill Plummer is the American face of Huawei, the company’s U.S. vice president of external relations and the only executive the home office in Shenzhen would let us speak to. We met him at Huawei’s North American headquarters in Plano, Texas.

Bill Plummer: We have the responsibility to clean up 10 years of misinformation and innuendo.

Steve Kroft: What’s the misinformation and innuendo?

Bill Plummer: The suggestion that a company by virtue of its heritage or flag of headquarters is somehow more vulnerable than any other company to some sort of mischief.

Plummer told us that Huawei is just another multinational corporation doing business in the United States, no different than Siemens, Samsung or Hyundai.

Bill Plummer: This room is a clean room.

He says Huawei buys six billion dollars in components from American suppliers every year and indirectly employs 35,000 Americans. And he says that the latest telecom gear Huawai hopes to sell in the U.S. poses no threat.

Steve Kroft: One national security expert said that if you build a network like this in another country, you basically have the keys to intercepting their communications. Is that a true statement?

Bill Plummer: Part of that might be a little bit fantastical. But you know, Huawei is a business in the business of doing business—$32.4 billion in revenues last year across 150 different markets, 70 percent of our business outside of China. Huawei is not going to jeopardize its commercial success for any government, period.

Steve Kroft: What’s the relationship between Huawei and the Chinese government?

Bill Plummer: We have a Beijing office. So, you know, we’re a regulated industry the same as we are here. You need to be able to interface with government.

Steve Kroft: So you’re saying the Chinese government has no influence over Huawei.

Bill Plummer: We’re another business doing business in China.

Steve Kroft: If you look at Huawei, it looks like just a big international company with an American face.

Chris Johnson: Yep. And that’s the intent.

Until last spring, Chris Johnson was the CIA’s top analyst on China, and he’s briefed the last three presidents on what’s been happening behind the scenes in Beijing. He tells a different story than Huawei’s Bill Plummer.

Chris Johnson: The problem I think is really it boils down to an issue of will the company take some steps to make themselves, you know, more transparent about their operations, and what their ultimate goal is, especially this relationship with the Chinese government, with the Chinese Communist Party and with the People’s Liberation Army.

Johnson says THE MILITARY has always played a role in Chinese telecommunications, and that Huawei’s reclusive CEO served as an army major in telecommunications research before he retired and founded Huawei, supposedly with a few thousand dollars in savings and no help from the Chinese government.

Steve Kroft: What could you tell me about the guy that runs this company? Ren?

Chris Johnson: Ren Zhengfei, yeah. He’s a very mysterious figure. And, you know, there really isn’t that much known about him.

Steve Kroft: Has he ever given an interview?

Chris Johnson: Not that I’m aware of. Of course it does generate these concerns about why he won’t give an interview and why he won’t say something about his role in the company and his philosophy of how the company operates.

Unlike Western companies that are usually regulated and scrutinized, about the only entity privy to the inner-workings of Huawei is a Communist Party Committee, which has offices inside the company’s headquarters.

Chris Johnson: You know, at the end of the day, the Communist Party controls the entire economy. They ultimately decide who the winners and losers are. The ultimate leverage that they have over these type of companies is that they can, you know, launch a corruption investigation against the chairman, for example.

Steve Kroft: If the Chinese government told Huawei that they wanted them to spy on the U.S. telecommunication system, and extract information, could Huawei say no?

Chris Johnson: It’d be very difficult for them, given the nature of their system.

Jim Lewis: Here, companies are used to, you know, throwing their weight around and telling the government what to do. In China, a company is a Chia pet. The state tells them what to do, and they do it.

There is no hard evidence that’s happened with Huawei, but the Obama administration has been unwilling to take the risk. Two years ago, when it appeared that Huawei might land its first big American deal—a five billion dollar contract to build Sprint’s new 4G wireless network—the U.S. government stepped in.

Jim Lewis: You had the Secretary of Commerce call the CEO of Sprint and lay out the U.S. concerns. Say that the U.S. was really worried about Huawei. And they would be a lot happier if Sprint didn’t do the deal.

Steve Kroft: And Sprint said, “OK.”

Jim Lewis: Sprint said, “OK.”

Since then, Huawei has blanketed U.S. airways with commercials and hired an army of lobbyists and public relations firms to help it get a foothold into the world’s largest telecom market.

Jim Lewis: They’re determined. They’re in it for the long haul. The line that most people think about is, Mao had a strategy called “Win the countryside, surround the cities, and then the cities will fall.” And Huawei seems to be following that Maoist strategy.

In the last couple of years, Huawei has managed to install and maintain a handful of networks in U.S. rural markets, including a vast quadrant of southwestern Kansas. Craig Mock is the president and general manager of United Wireless, based in the historic cowboy town of Dodge City.

raig Mock: We’re trying to reach out as far as we can into rural areas.

Mock told us the new Huawei network delivers some of the fastest Internet speeds in the country. But last spring after the deal had been signed with Huawei, Mock received an unwelcome visit from two federal agents.

Steve Kroft: Who were they? Intelligence people?

Craig Mock: Not gonna say.

Steve Kroft: Why did they come out here?

Craig Mock: I think they would’ve preferred that we bought equipment from somebody else.

Steve Kroft: What was your reaction? Were you upset that they came out?

Craig Mock: I was not pleased.

Steve Kroft: Because?

Craig Mock: Because I saw it as interference in our operations. If we’re not able to buy the very best equipment and deploy it in an efficient manner, then everybody suffers.

Steve Kroft: Were there any American companies that bid on this?

Craig Mock: I don’t know of any American companies that makes this equipment.

About the only real U.S. competitor Huawei has left is CISCO, which is still a worldwide player, but doesn’t produce all the equipment necessary to construct a 4G network. The only companies that do are all foreign: Huawei, Ericsson, which is Swedish, and the French company Alcatel-Lucent.

Jim Lewis: That’s where we’ve ended up. We now depend entirely on foreign suppliers. Three European, two Chinese. No Americans.

Steve Kroft: The United States used to dominate this field.

Jim Lewis: Yeah it’s true. You know, I guess we just were asleep at the switch.

Steve Kroft: What happened?

Jim Lewis: Some of it was just bad planning at the company level. Some of it was a lack of attention by the government. I mean, we would not have let the space industry go out of business. We would not say, “Oh, we’ll depend on foreign companies to launch our satellites.” But we didn’t do that for telecom.

Concerned and suspicious of what it calls continued Chinese penetration of U.S. telecommunications market, the House Intelligence Committee called Huawei executive Charles Ding to answer questions about the company’s corporate structure, ownership, finances, and management. The committee seemed to get nowhere.

Mike Rogers: The committee has been disappointed that the companies provided little actual evidence to ameliorate the committee’s concerns.

Huawei’s Bill Plummer says the company bears some responsibility for the lack of communication.

Bill Plummer: You’re right that over the 10 years of explosive growth we were not as good at communicating about ourselves as we could or should have been. But over the last couple of years we’ve really stepped that up. I mean, you want to know more about us, we’re an open book.

Steve Kroft: Really?

Bill Plummer: Yeah.

Steve Kroft: Has Mr. Ren ever given an interview?

Bill Plummer: Mr. Ren is not terribly well-known for his, his, his-- getting out in front of the media.

Steve Kroft: But we requested interviews various points along the way with company officials both in China and here. And we got their most important spokesman and lobbyist here in the United States. But it’s not like they swung open the doors and said, you know, “We’re an open book.”

Bill Plummer: Well I think that--

Steve Kroft: You allowed our camera crews into your facilities in Shenzhen and there was a big banner saying, “Welcome 60 Minutes.” But we weren’t allowed to talk to anybody. To speak to anybody.

Bill Plummer: The goal of the visit to Shenzhen was to give a really rich and visual impression of the company. It is a company that has experienced a history of not fully balanced treatment by the media. And that’s created a sense of wariness.

Huawei is not going to like the treatment it receives from the House Permanent Select Committee on Intelligence any better. Its final report is due tomorrow.



U.S. Congress Flags China’s Huawei, ZTE As Security Threats

By Simon Montlake
October 8, 2012

In early 2011, Chinese telecom-equipment giant Huawei made an unusual request to the U.S. Congress. In an OPEN LETTER, it asked lawmakers who had raised questions about Huaweis strategic mission to consider a full investigation into the company’s U.S. operations. The letters author, deputy chairman Ken Hu quoted Abraham Lincoln and President Obama in his lengthy defence of Huawei’s business practices, corporate governance and intent in expanding its U.S. investments. He concluded by requesting that the U.S. government investigate the “unfounded accusations” that had tarnished Huawei’s reputation in the world’s largest telecommunications market. The letter ended with an affirmation of U.S. regulatory rectitude.

The United States government has demonstrated its efficiency in management, fairness and impartiality and we have been impressed by that ever since we made our first investment in this country some 10 years ago. We have faith in the fairness and justness of the United States and we believe the results of any thorough government investigation will prove that Huawei is a normal commercial institution and nothing more.

This optimism appears to have been misplaced. The U.S. House Intelligence Committee is due to report Monday that Huawei and ZTE, a fellow Chinese telecom giant, cant be trusted to install phone and data networks because they could pose a threat to U.S. national security. This follows a year of hearings in Washington that pushed the two companies into a harsh spotlight as executives were called to testify under oath. The committee concluded, based on classified and unclassified information, that neither Huawei nor ZTE can be trusted “to be free of foreign state influence.” The foreign state being China, of course. Bloomberg reports:

“Private-sector entities in the United States are strongly encouraged to consider the long-term security risks associated with doing business with either ZTE or Huawei for equipment or services, the report says.”

The committee report was trailed Sunday by a critical segment on CBS News 60 Minutes. It focuses on Huawei, which allowed CBS to film inside its Shenzhen headquarters but didn’t make any senior executives available for interview. U.S. spokesman Bill Plummer, who appeared on the CBS segment, has told Bloomberg that the House report was baseless, at odds with the record, and that the allegations should be exposed as dangerous” political distractions.”

Indeed, the politics are palpable at a time when U.S. presidential candidates are busy sparring over China’s trading practices and invoking the “get tough” mantra. Chinese firms may wish to keep their heads down and rely on business trumping politics in future. But whoever wins in November, this particular issue isn’t going away. Huawei and ZTE are becoming global players in telecommunications equipment and mobile handsets, and the U.S isnt the only country uneasy over the security implications. Australia recently barred Huawei from a $37.5 billion project to build a national broadband network. Huawei gets 70% of its revenues from outside China, and wants to expand in developed markets. Its major competitors are Ericsson and Alcetel-Lucent, two European companies that donҒt raise the same red flags in Washington when they bid on domestic contracts.

Would U.S. lawmakers feel differently if Sweden and France ran large trade surpluses with the U.S. and were seen as discriminating against its companies? Possibly. And this is one reason why many in China will see the U.S. Congress as engaging in trade protectionism disguised as security policy. Huawei has argued repeatedly that it isn’t controlled by the Chinese government and that, in any case, its telecoms equipment doesn’t permit any backdoor surveillance. It says Western critics have paid undue attention to the fact that its founder Ren Zhengfei, is a former Army officer. This is a fair point, but Ren hasnt done himself any favours by staying in the shadows and leaving outsiders to ponder who really controls the company. In theory, it’s owned by its 140,000 employees. It reportedly floated the idea of an IPO on a foreign market to help clear up the ownership question. But potential investors may ask what are the risks of owning a company that faces regulatory roadblocks to doing business in the U.S. and other countries, given the serious claims in the House report.

There is another line of defence open to Huawei and its erudite defenders. They might point out that U.S. intelligence agencies have routinely obtained reams of data from U.S. telecom companies and have many clever (read: classified) ways to know what you are saying or writing. It would be naive to think that cyber-surveillance isn’t happening, and that powerful governments wouldn’t exploit their knowledge of telecom networks to defend their interests around the world. A sobering thought, but not one that you’re likely to hear voiced in the U.S. election campaign. Its much easier to bash China.


Bad Moon Rising
Part 1 - Part 2 - Part 3 - Part 4 - Part 5
Part 6 - Part 7 - Part 8 - Part 9 - Part 10
Part 11 - Part 12 - Part 13 - Part 14 - Part 15
Part 16 - Part 17 - Part 18 - Part 19 - Part 20
Part 21 - Part 22 - Part 23 - Part 24 - Part 25
Part 26 - Part 27 - Part 28 - Part 29 - Part 30
Part 31 - Part 32 - Part 33 - Part 34 - Part 35
Part 36 - Part 37 - Part 38 - Part 39 - Part 40
Part 41 - Part 42 - Part 43 - Part 44 - Part 45
Part 46 - Part 47 - Part 48 - Part 49 - Part 50
Part 51 - Part 52 - Part 53 - Part 54 - Part 55
Part 56

Posted by Elvis on 10/08/12 •
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