Whatever happened to General McChrystal?

My Financial Times headlines yielded this nugget of information.

Siemens hires former Afghanistan general
German group acquires services of Stanley McChrystal with aim of bolstering US government business arm
http://link.ft.com/r/M2ZOXX/DWRBYN/KESL1U/QN1CFG/HY3AXQ/VU/h?a1=2011&a2=12&a3=19

Further research demonstrated that he spent the first half of 2011 establishing
The McChrystal Group.

The Politics of the Top 1 Percent

http://fivethirtyeight.blogs.nytimes.com/2011/12/14/the-politics-of-the-1-percent/

DECEMBER 14, 2011, 11:51 AM
The Politics of the Top 1 Percent

A flawed article with some insights and some flaws. ~Via

There is more in the study. Here, for example, is a taste of Page, Cook, and Moskowitz’s findings regarding philanthropy:

Although many of our respondents express skepticism about government programs, and although some explicitly say that private philanthropy offers a superior approach, there is no strong tendency for those who are most suspicious of government to do more in the way of charitable activity.

By JOHN SIDES
What are the political attitudes of the very wealthy? How, and how much, do they differ from the less wealthy? The combination of growing inequality, a weak economy, and Occupy Wall Street’s ability to focus political debate on inequality makes the answers to these questions particularly relevant.

One answer to these questions comes from a new analysis by Gallup that made the rounds last week. By aggregating 61 polls from 2009-2011, they were able to measure the opinions of about 400 respondents with annual incomes of $500,000 or above. Gallup reports only modest (really, 57 v 44% is not modest) differences in their party identification: 57 percent of the 1 percent identify as or lean Republican, compared to 44 percent of the 99 percent. There are virtually no differences in how they identify ideologically: 39 percent of the 1 percent identify as conservative, compared to 40 percent of the 99 percent.

But the Gallup analysis may overstate the similarity of the two groups. A second study, authored by the political scientists Benjamin Page, Fay Lomax Cook, and Rachel Moskowitz and recently released by the Russell Sage Foundation, found that the politics of the very wealthy are strikingly different.

Their study, which was part of a larger project called the Study of Economically Successful Americans and the Common Good, involved something unusual: a random sample of the rich. In particular, they interviewed 104 wealthy individuals in the Chicago area between February and June 2011. The sampling frame, constructed from various sources, was essentially the top 1 percent in terms of wealth (not income, as in the Gallup analysis). The response rate among the wealthy individuals they contacted was 37 percent, which may seem low on its face but is quite respectable by contemporary standards. The median wealth of this group was $7.5 million. (Of course, the broader project is surveying wealthy people nationwide, not only in Chicago.)

What did the survey find? For one, balance of party identification in this sample is very similar to what Gallup found: 58 percent of this sample identified as or lean Republican. In several other ways, however, the political behavior of the top 1 percent diverges more strongly from the 99 percent than Gallup’s analysis suggests.

The 1 percent cares more about deficits than the economy. When asked to name the most important problem facing the country, 32 percent of respondents said the deficit and 11 percent said the economy. By contrast, in an April 2011 CBS News/New York Times poll, 49 percent of Americans said the economy or jobs and only 5 percent said the deficit.

The 1 percent wants private-sector solutions, not government solutions. Among those who considered the deficit the most important problem, 65 percent favored spending cuts and 24 percent favored a combination of spending cuts and revenue increases. By contrast, a September 2011 New York Times/CBS News poll found that only 21 percent of respondents favored spending cuts exclusively. The majority (71 percent) favored spending cuts and tax increases.

The 1 percent is vastly more politically active. In the Chicago sample, 99 percent reported voting in 2008; in the 2008 American National Election Study, only 78 percent of a nationally representative sample reported voting. Both numbers are probably inflated – nowhere near 78 percent of Americans actually voted in 2008 — but it seems unlikely that misleading survey responses would fully account for the gap between the 1 percent and Americans as a whole. Other measures of participation show even larger gaps. For example, 41 percent of the very wealthy reported attending a political meeting. Only 9 percent of Americans did so in 2008. And 68 percent of the very wealthy reported giving money to a political candidate, party, or cause in the last four years. In 2008–a year in which “small donors” were numerous–only 13 percent of Americans donated to a political candidate or party. Again, there are small differences in the wording of the questions between the two surveys, but they are not likely responsible for the 55-point gap.

There is more in the study. Here, for example, is a taste of Page, Cook, and Moskowitz’s findings regarding philanthropy:

Although many of our respondents express skepticism about government programs, and although some explicitly say that private philanthropy offers a superior approach, there is no strong tendency for those who are most suspicious of government to do more in the way of charitable activity.

To be sure, this is very much a project in progress. But even these initial results, however unsurprising, are important. Other scholars have found that, when the attitudes of the wealthy and less wealthy diverge, policy is much more in line with the attitudes of the wealthy. The activism evident in the Chicago sample may explain why: they do much more to articulate their views to politicians. (Of course, politicians themselves are often in the 1 percent.) These inequalities in political voice may then give rise to policies that perpetuate unequal outcomes.

37 Giant Corporations Paid 0 (ZERO) in Taxes Last Year -- Who Are the Cheats?

37 Giant Corporations Paid 0 in Taxes Last Year -- Who Are the Cheats?

By Andrew Leonard, Salon
Posted on November 3, 2011, Printed on November 4, 2011
http://www.alternet.org/story/152958/37_giant_corporations_paid_0_in_taxes_last_year_--_who_are_the_cheats

In 2010, Verizon reported an annual profit of nearly $12 billion. The statutory federal corporate income tax rate is 35 percent, so theoretically, Verizon should have owed the IRS around $4.2 billlion. Instead, according to figures compiled by the Center for Tax Justice, the company actually boasted a negative tax liability of $703 million. Verizon ended up making even more money after it calculated its taxes.

Verizon is hardly alone, and isn’t even close to being the worst offender. Perhaps most famously, General Electric raked in $10.5 billion in profit in 2010, yet ended up reporting $4.7 billion worth of negative taxes. The worst offender in 2010, as measured by its overall negative tax rate, was Pepco, the electricity utility that serves Washington, D.C. Pepco reported profits of $882 million in 2010, and negative taxes of $508 million — a negative tax rate of 57.6 percent.

Altogether, according to “Corporate Taxpayers & Corporate Tax Dodgers 2008-10,” a blockbuster new report put together by the Citizens for Tax Justice and the Institute on Taxation and Economic Policy that will have you reaching for your hypertension medicine before you finish reading the third page, 37 of the United States’ biggest corporations paid zero taxes in 2010. The list is a blue-chip roll-call.

As the authors acidly note, “Most Americans can rightfully complain, ‘I pay more federal income taxes than General Electric, Boeing, DuPont, Wells Fargo, Verizon, etc., etc., all put together.’ That’s an unacceptable situation.”

The “high taxation” lie

Reading through this report, you will find yourself seized by an irresistible desire to hurl yourself headlong into the nearest OccupyYourLocalCity protest. In an era of crushing government deficits and mass unemployment, corporate America is not only skating blissfully free of its civic responsibilities, but continues to complain that it is paying too much in taxes. Even worse: Congressional Republicans and many Democrats agree! Listening to our politicians talk, you would imagine that corporate America’s neck is permanently under the tax man’s steel-tipped boot. When, in fact, the exact opposite is the truth.

The list of companies that paid zero taxes is only the beginning of the travesties documented by the report. The authors looked at the tax filings from 2008-2010 of 280 of the nation’s biggest, most successful corporations. These companies reported $1.4 trillion worth of profit during a period when most Americans were struggling to stay afloat. The authors discovered that the average effective tax rate — what the companies really paid after government subsidies, tax breaks and various tax dodges were taken into account — was only 18.5 percent, less than half the statutory rate. Fully a quarter of the 280 companies paid under 10 percent.

Remember that fact, the next time someone tries to tell you that American corporations pay the highest income taxes in the free world. The only number that counts is the “effective tax rate.” One of the interesting tidbits provided by the authors is that in many cases, the tax rate on foreign income for many of these companies is actually higher than the effective U.S. rate.

The most distressing part of the tale is the big picture: The overall trend line is pointed in exactly the wrong direction. If you break out just the years 2009-2010, the effective tax rate was 17.3 percent. “In 2008, 22 companies paid no federal income tax, and got $3.3 billion in tax rebates. In 2010, 37 companies paid no income tax, and got $7.8 billion in rebates.” When measured as a percentage of total GDP, over the last three fiscal years, “total corporate income tax payments fell to only 1.16 percent of the GDP … a new sustained record low since World War II.

Corporate taxes paid for more than a quarter of federal outlays in the 1950s and a fifth in the 1960s. They began to decline during the Nixon administration, yet even by the second half of the 1990s, corporate taxes still covered 11 percent of the cost of federal programs. But in fiscal 2010, corporate taxes paid for a mere 6 percent of the federal government’s expenses.

How have these companies managed to cut their tax liabilities so far? The answer includes a mixture of targeted tax breaks that impact specific industries or companies, accounting games that corporations play with stock options, and sweeping adjustments to tax law such as changes in the rules in how companies can write off the value of depreciating equipment. The accounting rules for so-called accelerated depreciation are now so accommodating that companies can write off 75 percent of the cost of new equipment immediately.

A look at the list of the 10 corporations receiving the biggest tax-subsidy breaks from the U.S. government will defeat the ameliorating effects of anymedication: Wells Fargo, AT&T, Verizon Communications, General Electric, International Business Machines, Exxon Mobil, Boeing, PNC Financial Services Group, Goldman Sachs Group, and Procter & Gamble. “56 percent of tax subsidies,” write the authors, “went to four industries: financial, utilities, telecom, oil/gas/pipeline.”

The companies that pay

However, not all companies are tax dodgers. Of the 280 companies analyzed by the authors, about 25 percent of the total paid close to the statutory rate, a little over 30 percent. But there’s no rhyme or reason to who pays or who doesn’t.

DuPont and Monsanto both produce chemicals. But over the 2008-10 period, Monsanto paid 22 percent of its profits in U.S. corporate income taxes, while DuPont actually paid a negative tax rate of –3.4 percent. Department store chain Macy’s paid a three-year rate of 12.1 percent, while competing chain Nordstrom’s paid 37.1 percent. In computer technology, Hewlett-Packard paid 3.7 of its three-year U.S. profits in federal income taxes, while Texas Instruments paid 33.5 percent. FedEx paid 0.9 percent over three years, while its competitor United Parcel Service paid 24.1 percent.

The authors conclude on a wistful note, with a list of what Washington could do to bring sense and reason to corporate taxation, while providing the government with desperately needed revenue. But as the authors themselves readily acknowledge, their recommendations exist in an alternate universe from the one that we actually happen to live in.

Unfortunately, corporate tax legislation now being promoted by many in Congress seems stuck on the idea that as a group, corporations are now either paying the perfect amount in federal income taxes or are paying too much. Many members of the tax writing committees in Congress seem intent on making changes that would actually make it easier (and more lucrative) for companies to shift taxable profits, and potentially jobs, overseas. Meanwhile, GOP candidates for president are all promoting huge cuts in the corporate tax or, in several cases, even elimination of the corporate income tax entirely.

And that, ultimately, is the most enraging fact about the new report from the Citizens for Tax Justice and the Institute on Taxation and Economic Policy. It won’t make a darn bit of difference.

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

House panel hearing explores U.S. government contractors’ exploitation of workers overseas

By Olivia LaRosa
Those government entitlements corporations receive, called contracts by some, result in the enslavement of human beings and have for decades.  Yea verily even for centuries.

Congress is taking note.  I bet they will order a "study" then develop yet another toothless enforcement mechanism that will co-opt the the opposition of the left once more. Seems like the more often you tell people that you are going to do something about the say, the red-eared turtle problem, the more likely they are to forget about whatever was troubling them.

One recent stomach-turning example by a third-striker, DynCorp, here:

Wikileaks Reveals U.S. Tax Dollars Fund Child Sex Slavery in Afghanistan

I have often asked this question of my right-wing acquaintances:

"Why aren't your organizations involved in child-abuse prevention?"  Invariably, my answer is a blank stare from the questioned. 

My intuition, experience, and education tells me that the institutional instinct to shelter, or fail to report abusers, is related to the maintenance of patriarchy.  Today, the papers ran a feature story about a man who had been victimizing Boy Scouts since 1970.  He was occasionally impeded in his rampage, but never for long. Everyone knows about the system-wide institutional cover-up of abuse in the Catholic Church, and many other organizations, too numerous to list here.

The Left's Interest in this Issue

At least 1/3 of women have been sexually abused at some point in their lives.  Child abuse frequently continues for years, while the child feels increasingly alienated, abandoned, and fearful of the world. Most sexual abusers are men, 95% to women's 5%.  The high percentage of men is accounted for not because 95% of men are abusers, but because the abuser is a repeat offender of the worst sort.  I have met thousands of men in the course of my 46-year course of parenthood, 15 years of work in a consumer branch bank, and seemingly endless quest for a BA.

Therefore I believe that most of the thousands of men I met were civilized, kind, and thoughtful.

The needless damage abusers cause our children and their families costs our society in a geometric progression from the relationship between the abused and the abuser, those who choose to face the horror, and those who choose to run and hide from the monstrous act. All too often, serial child abusers walk free every single day of their lives, because too many of us choose to run and hide when confronted with the evidence that their brother/son/uncle is a child molester.

Please allow me to share with you my first sexual victimization.  Why?  Because I emerged only slightly damaged by the experience. It occurred when I was five years old.  The neighbor boy around the corner, 15 years old, talked me into going into his garage.  After he released me and I walked back home, my grandmother glanced at me, then peered at me in alarm, and said, "Baby, what's wrong?" I told her what had happened to me. It was that way between us; I always told my grandma everything.

She said, "You don't worry about a thing.  You did not do anything wrong. You just get comfy and wait here for me.  I am going next door."

Victims seldom feel the relief of closure of their violation.  Reasons for this include:

1. denial of violation or knowledge thereof by child's primary caregiver (say, father is violator and mother is enabler here).

2. violator is a stranger; or unsought or unapprehended

3. violator is the breadwinner of the family and thus deemed immune from punishment for his heinous acts.

4. violator is a family member; reports to parents are not believed

5. violator threatens to harm or kill family members who try to intervene in the abuse

6. violator is a sibling

Closure for most of us would be to tell the violator how his violation of our personal space and physical body hurt us. Children are trusting by nature. Nothing harms a child more than violations of that trust.

Closure would also include the ability to be secure in the knowledge that the violator will be unable to commit further crimes. We are kids; we don't know how you adults punish people.  We figure that they have outgrown spankings, and imagination fails to think of anything more horrible than a spanking.

The shock of the violation often frightens victims into cages bounded by fear; friendship and love often seem far away. It is amazing that we master the ability to regain a healthy relationship with other humans.

Furthermore, parents of abused children feel hollowed out by the knowledge that the child they had protected and warned (about people who tried to touch you or give you food or get in their car) was so powerfully coerced by her abuser that she could not tell. These parents would have given anything to be able to share and ease the terrible burden borne by their child.




Counseling and psychotherapy will do wonders for all of the victims of sexual abuse.

Alas, too often they end up at the bottom of the heap because their emotional damage and the bodily memories of their suffering burden them with less effective functioning capabilities.

The WaPo article links follow:

Print Style

http://www.washingtonpost.com/politics/house-panel-hearing-explores-us-government-contractors-exploitation-of-workers-overseas/2011/11/02/gIQAImMggM_print.html

Web Page

http://www.washingtonpost.com/politics/house-panel-hearing-explores-us-government-contractors-exploitation-of-workers-overseas/2011/11/02/gIQAImMggM_story.html?wpisrc=nl_fedinsider

The Left's Interest in this Issue

At least 1/3 of women have been sexually abused at some point in their lives.  This abuse frequently continues for years, while the child feels increasingly alienated, abandoned, and fearful of the world. Most sexual abusers are men, 95% to women's 5%.  The high percentage is accounted for because the abuser is a repeat offender of the worst sort.  The needless damage to our children by abusers costs us all in the long run.  Few victims of abuse emerge with the ability to regain a healthy relationship with other humans.  Far too often they end up at the bottom of the heap because their emotional damage and the bodily memories of their suffering burden them with less effective functioning capabilities.

Congrats to the Gang of Six, the Powerful, the Wealthy, and Multinational Corporations

http://www.commondreams.org/view/2011/07/21


Published on Thursday, July 21, 2011 by CommonDreams.org

Congrats to the Gang of Six, the Powerful, the Wealthy, and Multinational Corporations

by Bernie Sanders

If there was ever a time in the modern history of America that the American people should become engaged in what's going on here in Washington, now is that time. Decisions are being made that will impact not only our generation but the lives of our children and our grandchildren for decades to come, and I fear very much that the decisions being contemplated are not good decisions, are not fair decisions.

There is increased understanding that that defaulting for the first time in our history on our debts would be a disaster for the American economy and for the world's economy. We should not do that.

There also is increased discussion about long-term deficit reduction and how we address the crisis which we face today of a record-breaking deficit of $1.4 trillion and a $14 trillion-plus national debt.

One of the long-term deficit reduction plans came from the so-called Gang of Six. We do not know all of the details of that proposal. In fact, we never will know because a lot of the decisions are booted to committees to work out the details.

It is fair to say, however, that Senators Coburn, Senator Crapo and Chambliss deserve congratulations. Clearly, they have won this debate in a very significant way. My guess is that they will probably get 80 percent or 90 percent of what they wanted. In this town, that is quite an achievement, but they have stood firm in their desire to represent the wealthy and the powerful and multinational corporations. They have threatened. They have been smart. They have been determined. And at the end of the day, they will get almost all of what they want. That is their victory, and I congratulate them.

Unfortunately, their victory will be a disaster for working families in this country, for the elderly, for the sick, for the children and for low-income people.

Based on the limited information that we have, I think it is important to highlight some of what is in this so-called Gang of Six proposal that the corporate media, among others, are enthralled about.

Some may remember that for a number of years, leading Democrats said that we will do everything that we can to protect Social Security, that Social Security has been an extraordinary success in our country, that for 75 years, with such volatility in the economy, Social Security has paid out every nickel owed to every eligible American. I heard Democrats say that Social Security has nothing to do with the deficit. That is right because Social Security is funded by the payroll tax, not by the U.S. Treasury. Social Security has a $2.6 trillion surplus today. It can pay out every benefit owed to every eligible American for the next 25 years. It is an enormously popular program. Poll after poll from the American people says doesn't cut Social Security. Two and a half years ago when Barack Obama, then a senator from Illinois, ran for president of the United States, he made it very clear if you voted for him there would be no cuts in Social Security.

What Senators Coburn, Crapo and Chambliss have managed to do in the Gang of Six is reach an agreement where there will be major cuts in Social Security. Don't let anybody kid you about this being some minor thing. It is not. What we are talking about is that Social Security cuts would go into effect virtually immediately. Ten years from now, the typical 75-year-old person will see their Social Security benefits cut by $560 a year. The average 85-year-old will see a cut of $1,000 a year. Now, for some people here in Washington, maybe the big lobbyists who make hundreds of thousands a year, $560 a year or $1,000 a year may not seem like a lot of money, but if you are a senior trying to get by on $14,000, $15,000, $18,000 a year and you're 85 years old, the end of your life, you're totally vulnerable, you're sick -- a $1,000 per year cut in what you otherwise would have received is a major, major blow.

So I congratulate Senator Coburn, Senator Crapo, Senator Chambliss for doing what president Obama said would not happen under his watch, what the Democrats have said would not happen under their watch.

But it's not just Social Security. We have 50 million Americans today who have no health insurance at all. Under the Gang of Six proposals, there will be cuts in Medicare over a 10-year period of almost $300 billion. There will be massive cuts in Medicaid and other health care programs. There will be caps on spending, which mean that there will be major cuts in education. If you are a working-class family, hoping that you're going to be able to send your kid to college and thinking that you will be eligible for a Pell grant, think twice about that. Pell grants may not be there. If you're a senior who relies on a nutrition program, that nutrition program may not be there. If you think it's a good idea that we enforce clean air and clean water provisions so that our kids can be healthy, those provisions may not be there because there will be major cuts in environmental protection.

Some people think that's not so good, but at least our Republican friends are saying we need revenue and we're going to get $1 trillion in revenue. But wait a minute,. If you read the proposal, there are very, very clear provisions making sure that we are going to make massive cuts in programs for working families, for the elderly, for the children. Those cuts are written in black and white. What about the revenue? Well, it's kind of vague. The projection is that we would rise over a 10-year period $100 billion in revenue. Where is that going to come? Is it necessarily going to come from the wealthiest people in this economy? Is it going to come from large corporations who are enjoying huge tax breaks? That is not clear at all. I want middle-class families to understand that when we talk about increased revenues, do you know where that comes from? It may come from cutbacks in the home mortgage interest deduction program, which is so very important to millions and millions of families. It may mean that if you have a health care program today, that health care program may be taxed. That's a way to raise revenue. It may be that there will be increased taxes on your retirement programs, your I.R.A.'s, your 401(k)'s. But we don't have the details for that. All we have is some kind of vague promise that we're going to raise $1 trillion over the next 10 years, no enforcement mechanism and no clarity as to where that revenue will come from.

That is why it is so terribly important that the American people become engaged in this debate which will have a huge impact on them, on their parents and on their children. The American people must fight for a fair deal. At a time when the wealthiest people in this country are doing phenomenally well and their effective tax rate is the lowest on record, at a time when the top 400 individuals in this country own more wealth than 150 million Americans, at a time when corporate profits are soaring and in many instances corporations, these same corporations pay nothing in taxes, at a time when we have tripled military spending since 1997, there are fair ways to move toward deficit reduction which do not slash programs that working families and children and the elderly desperately depend upon.

This senator is going to fight back. I was not elected to the United States Senate to make devastating cuts in Social Security, in Medicare, in Medicaid, in children's programs while lowering tax rates for the wealthiest people in this country.

Bernie Sanders (I-Vt.) was elected to the U.S. Senate in 2006 after serving 16 years in the House of Representatives. He is the longest serving independent member of Congress in American history. Elected Mayor of Burlington, Vt., by 10 votes in 1981, he served four terms. Before his 1990 election as Vermont's at-large member in Congress, Sanders lectured at the John F. Kennedy School of Government at Harvard and at Hamilton College in upstate New York. Read more at his website.

more Bernie Sanders

Ron Paul wins CPAC straw poll; US Super-rich Get Five Times More Income Than In 1995

Shocked, and not shocked, by today's morning headlines. Ron Paul, the man with half-a-lick-o-sense, won the Conservative Political Action Committee's vote for President of the US 0f A. Ron Paul is my ally, although he doesn't know it. Paul is a capitalist libertarian. I am a socialist libertarian. The main difference between Ron Paul and me is that he believes in the fairy tale of a free market and I most definitely do not.

Markets are never free. They operate in tandem with governments. I agree that production that is not controlled by governments is better than production controlled by governments, in theory. But have you seen all the junk at the dollar store? People should have to take out a permit to manufacture and transoceanically ship those ugly figurines.

http://voices.washingtonpost.com/thefix/eye-on-2012/tk-wins-cpac-straw-poll.html?wprss=thefix

Big Bank Fails

By Olivia LaRosa July 7, 2008

Better start thinking about planting that vegetable garden...

Interalia*, Hypatia is that dreaded creature, an Econ Geek. I took my first econ class when I was 16 years old. I always thought that I wanted to become an economist until I saw the course list. (((Snore.)))

Economists have the best jobs! Even when they are wrong, they can always come up with a plausible excuse and remain employed.

However, I have kept up with the field, and know enough to know that there is nothing, nothing, nothing that will stop the US economy on its greased slide into oblivion. A lack of effective regulation, such as in the case of Indymac, is only one facet of the TOTAL lack of conservation and prudence on the part of the ummmm...conservatives.

Example follows:

Crisis Deepens as Big Bank Fails

IndyMac Seized
In Largest Bust
In Two Decades

By DAMIAN PALETTA and DAVID ENRICH

July 12, 2008; Page A1
http://online.wsj.com/article/SB121581435073947103.html?mod=hpp_us_whats_news
IndyMac Bank, a prolific mortgage specialist that helped fuel the housing boom, was seized Friday by federal regulators, in the third-largest bank failure in U.S. history.
IndyMac is the biggest mortgage lender to go under since a fall in housing prices and surge in defaults began rippling through the economy last year -- and it likely won't be the last. Banking regulators are bracing for a slew of failures over the next year as analysts say housing prices have yet to bottom out.

The collapse is expected to cost the Federal Deposit Insurance Corp. between $4 billion and $8 billion, potentially wiping out more than 10% of the FDIC's $53 billion deposit-insurance fund.

The Pasadena, Calif., thrift was one of the largest savings and loans in the country, with about $32 billion in assets. It now joins an infamous list of collapsed banks, topped by Continental Illinois National Bank & Trust Co., which failed in 1984 with $40 billion of assets. The second-largest failure was American Savings & Loan Association of Stockton, Calif., in 1988.

The director of the Office of Thrift Supervision, John Reich, blamed IndyMac's failure on comments made in late June by Sen. Charles Schumer (D., N.Y.), who sent a letter to the regulator raising concerns about the bank's solvency. In the following 11 days, spooked depositors withdrew a total of $1.3 billion. Mr. Reich said Sen. Schumer gave the bank a "heart attack."

"Would the institution have failed without the deposit run?" Mr. Reich asked reporters. "We'll never know the answer to that question."

Mr. Schumer quickly fired back.

"If OTS had done its job as regulator and not let IndyMac's poor and loose lending practices continue, we wouldn't be where we are today," Sen. Schumer said. "Instead of pointing false fingers of blame, OTS should start doing its job to prevent future IndyMacs."


IndyMac had been troubled for months, and investors were concerned about its possible downfall well before Sen. Schumer's comments. It specialized in Alt-A loans, a type of mortgage that can often be offered to borrowers who don't fully document their incomes or assets. The company sold most of the loans it originated, but continued to hold some on its books. As defaults piled up, IndyMac's finances deteriorated.

The bank will be run by the FDIC and reopen Monday. The FDIC typically insures up to $100,000 per depositor. IndyMac had roughly $19 billion of deposits. Nearly $1 billion of those deposits were uninsured, affecting about 10,000 people, the FDIC said.

IndyMac's arc -- rapid growth, followed by an even more rapid descent -- is a microcosm of the mortgage industry. It boomed in the first part of this decade, as investors were willing to fund loans on ever-looser terms, then hit hard times when the housing market began to turn down in late 2006.

Small mortgage lenders started going under quickly, with the number of failures climbing into the hundreds. Now the fallout has spread world-wide, bringing down some of America's largest financial institutions. Bear Stearns Cos., which suffered losses on mortgage-related investments, underwent a meltdown in March and had to be rescued by J.P. Morgan Chase & Co.

Countrywide Financial Corp., at one time the nation's largest mortgage lender, saw its stock price plunge this year and was forced to sell itself to Bank of America Corp. at a firesale price.

IndyMac, in a last-ditch effort to fend off collapse after it failed to raise fresh capital, said this past week it was firing more than half its work force and closing most of its lending operations. While its shares had been tumbling since early 2007, the move was nonetheless jarring for a company that ranked as the ninth-largest U.S. mortgage lender last year in terms of loan volume, according to trade publication Inside Mortgage Finance.

IndyMac is one of the few federally insured banks to fail in recent years. Banking regulators are bulking up their staff of bank examiners and taking a tough approach toward banks that are seen as risky.

Mr. Reich, the thrift regulator, noted that the IndyMac case had some "unique" features, including the involvement of Sen. Schumer and the rapid fall in its deposits. Officials said most of the recent withdrawals came from depositors at branches, rather than those making deposits at IndyMac's online bank.

IndyMac was set up by Countrywide in 1985, but the two companies severed ties in 1997 and became direct competitors. The company's name stands for Independent National Mortgage. It was created to specialize in jumbo mortgages -- those that are too big to be sold to government-backed Fannie Mae and Freddie Mac. In 1997, under the direction of Chief Executive Michael Perry, a protege of Countrywide chief Angelo Mozilo, IndyMac set off on its own.

The company grew quickly, pioneering the issuance of so-called Alt-A mortgages to people with blemished credit histories. The loans have gained notoriety as an example of the type of lax lending that came to characterize much of the mortgage industry.

Early last year, Mr. Perry remained optimistic about IndyMac's future, insisting that the company had the resources to remain independent. At the time, IndyMac's stock was trading for about $45 a share.

But the combination of the frozen credit markets and mounting defaults on IndyMac loans steadily sapped investor confidence in the company. In February, IndyMac reported the first annual loss in its 23-year history. By this week, its shares, which ended last year at less than $7 each, were trading for 28 cents apiece.

The company was desperate for more capital but couldn't find investors willing to put fresh funds into what looked like a crippled institution.

The failure could be felt across the entire banking industry, as the FDIC will likely have to raise insurance assessments for all banks to build up government reserves. "It takes a big chunk out of the FDIC insurance fund," said Chip MacDonald, a banking lawyer at law firm Jones Day. He said that if the FDIC hikes insurance fees, that will add to already-intense pressure on bank profits.

The OTS and FDIC didn't secure any outside firm to acquire the bank's assets. The FDIC will temporarily run the bank through a new bank it has created, called IndyMac Federal Bank, FSB.

Write to Damian Paletta at damian.paletta@wsj.com and David Enrich at david.enrich@wsj.com

*The taxpayers of California and I are in debt to the tune of $125K for my education.

Discovery the Hidden History Behind the Bush Dynasty

http://www.secrecyandprivilege.com/

Discover the Hidden History
Behind the Bush Dynasty

Secrecy & Privilege
by Robert Parry
390 pages (paperback)
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Tracing investigative leads back through three decades, Secrecy & Privilege explores the mystery of how the two George Bushes rose to the pinnacle of American political power – and what the rise of their dynasty has meant to the nation’s democratic principles.



Purchase 'Secrecy & Privilege' along with Parry's 1999 book 'Lost History' for only $32, a 30% discount!

Two ‘must-read’ books, Lost History and Secrecy & Privilege fill in missing chapters of modern U.S. history – from the truth about the Reagan administration’s complicity in drug trafficking of the 1980s to the real story of how the Bush Family’s rise to power transformed American democracy.

When you order now, $10 from the purchase will be donated to Consortiumnews.com.

Halliburton moving to Dubai! Congress must stop them!

http://www.nytimes.com/reuters/business/business-halliburton-mideast-listing.html?_r=2&oref=slogin&oref=slogin

By Olivia LaRosa March 11, 2007

The criminal organization known as Halliburton is moving its headquarters to Dubai. Halliburton, its entities, and subsidiary companies have been looting American taxpayers blind with no bid contracts for the last six years and longer.

First, Halliburton gets most of its income in the form of government contracts. Halliburton already avoids most taxes by laundering its money through offshore tax havens. Why is Halliburton moving its operations away from the USA? Is it in order to drain the last dollar from American citizens? Halliburon is a like a vortex, consuming everything in its path.

Second, Halliburton is moving to Dubai, a Muslim country. That does not bother me, but it is sure going to bother Bush's brainwashed minions, who have been trained to fear all Muslims/Arabs/anyone from the Middle East who doesn't look Jewish. If Halliburton was concerned about terrorism, they are moving into what the right wing thinks is the seventh circle of Hell.
In the article, someone claimed that Halliburton was not moving its headquarters away for tax purposes. It may be that they have already moved all of their profits offshore already.

The Democratic Party has to reach way down and drum up some pluck and gumption. Congress must take action to freeze Halliburton's assets and stop paying on those no-bid contracts.

A Halliburton subsidiary, IAP, got the contract from the Bush administration to start running Walter Reed Hospital in January of 2006. IAP ran Walter Reed further into the ground than it always was due to Bush administration cuts. Halliburton itself is responsible for $2.7 Billion in missing funds so far in Iraq.

Stop Halliburton now.

What if the Top One Percent Owned More than 1/2 of all Corporate Assets?

This is not a future scenario, folks. Already happened. And we wonder why we have no control over our government?

Read more here about its effects.
Progress Action Now commentary


http://www.nytimes.com/2006/01/29/national/29rich.html?_r=1&oref=slogin

January 29, 2006
Corporate Wealth Share Rises for Top-Income Americans
By DAVID CAY JOHNSTON
New government data indicate that the concentration of corporate wealth among the highest-income Americans grew significantly in 2003, as a trend that began in 1991 accelerated in the first year that President Bush and Congress cut taxes on capital.

In 2003 the top 1 percent of households owned 57.5 percent of corporate wealth, up from 53.4 percent the year before, according to a Congressional Budget Office analysis of the latest income tax data. The top group's share of corporate wealth has grown by half since 1991, when it was 38.7 percent.

In 2003, incomes in the top 1 percent of households ranged from $237,000 to several billion dollars.

For every group below the top 1 percent, shares of corporate wealth have declined since 1991. These declines ranged from 12.7 percent for those on the 96th to 99th rungs on the income ladder to 57 percent for the poorest fifth of Americans, who made less than $16,300 and together owned 0.6 percent of corporate wealth in 2003, down from 1.4 percent in 1991.

The analysis did not measure wealth directly. It looked at taxes on capital gains, dividends, interest and rents. Income from securities owned by retirement plans and endowments was excluded, as were gains from noncorporate assets such as personal residences.

This technique for measuring wealth has long been used in standard economic studies, though critics have challenged that tradition.

Among them is Stephen J. Entin, president of the Institute for Research on the Economics of Taxation in Washington, which favors eliminating most taxes on capital and teaches that an unintended consequence of the corporate income tax is depressed wage rates. Mr. Entin said the report's approach was so flawed that the data were useless.

He said reduced tax rates on long-term capital gains may have prompted wealthy investors to sell profitable investments. That would show up in tax data as increased wealth that year, even though the increase may have built up over decades.

Long-term capital gains were taxed at 28 percent until 1997, and at 20 percent until 2003, when rates were cut to 15 percent. The top rate on dividends was cut to 15 percent from 35 percent that year.

The White House said it did not believe that the 2003 tax cuts had much influence on wealth shares. It also said that since wealth is transitory for many people, a more important issue is how incomes and wealth are influenced by the quality of education.

"We want to lift all incomes and wealth," said Trent Duffy, a White House spokesman. "We are starting to see that the income gap is largely an education gap."

"The president thinks we need to close the income gap, and he has talked about ways in which we can do that," especially through education, Mr. Duffy said.

The data showing increased concentration of corporate wealth were posted last month on the Congressional Budget Office Web site. Isaac Shapiro, associate director of the Center on Budget and Policy Priorities in Washington, spotted the information last week and wrote a report analyzing it.

Mr. Shapiro said the figures added to the center's "concerns over the increasingly regressive effects" of the reduced tax rates on capital. Continuing those rates will "exacerbate the long-term trend toward growing income inequality," he wrote.

The center, which studies how government affects the poor and supports policies that it believes help alleviate poverty, opposes Mr. Bush's tax policies.

The center plans to release its own report on Monday that questions the wisdom of continuing the reduced tax rates on dividends and capital gains, saying the Congressional Budget Office analysis indicates that the benefits flow directly to a relatively few Americans.

On Charity-Super Rich Not So Generous

Study Shows the Superrich Are Not the Most Generous

David Cay Johnston, a reporter for the New York Times, has been reporting on income taxes and related issues for decades. Here is his latest. This article points out why we cannot rely on "trickle down" charity to take care of the needs of the most vulnerable of us.

The tax nuts, those who want to abolish all taxes, claim that the needs of the less fortunate will be taken care of by the private charity sector. That has never been the case, and it is not the case now, even in these days of spendthrift giveways to the ultra rich on the part of a government gone insane. Charitable giving has actually dropped as a percentage of income among the rich since the tax cuts took effect.

The proliferation of non-profit organizations is the privatization of what should be government functions. I am not complaining, mind you, that we have non-profit organizations, but rather, that the government uses them to shirk its ministerial duties.

I strongly recommend a sober and well-researched book by Johnston: Perfectly Legal.


December 19, 2005
Study Shows the Superrich Are Not the Most Generous
By DAVID CAY JOHNSTON
Working-age Americans who make $50,000 to $100,000 a year are two to six times more generous in the share of their investment assets that they give to charity than those Americans who make more than $10 million, a pioneering study of federal tax data shows.

The least generous of all working-age Americans in 2003, the latest year for which Internal Revenue Service data is available, were among the young and prosperous - the 285 taxpayers age 35 and under who made more than $10 million - and the 18,600 taxpayers making $500,000 to $1 million. The top group had on average $101 million of investment assets while the other group had on average $2.4 million of investment assets.

On average these two groups made charitable gifts equal to 0.4 percent of their assets, while people the same age who made $50,000 to $100,000 gave gifts equal to more than 2.5 percent of their investment assets, six times that of their far wealthier peers.

Go to Original--Study Shows the Superrich Are Not the Most Generous