October 9, 2011

Great Video: ‘Government Is Its Own Special Interest’

Filed under: Economy,Taxes & Government — Tom @ 11:38 pm

Outstanding (HT to an emailer) — and sobering:

“We are out of the era of big government into the era of enormous government.”

Stay tuned to the end to get a grasp of the degree of danger we are in of not ever being able to get government under control.

AP Whitewashes Chavez’s Planned Island Property Expropriation, Waters It Down Further in 24 Hours

In a report carried at the Washington Post on Thursday and updated early Friday, the Associated Press’s Christopher Toothaker wrote a lengthy report about how Venezuelan ruler Hugo Chavez plans to “expropriate homes on the Caribbean resort islands of Los Roques, saying the structures were built on plots bought in shadowy business deals.” By the end of the day Friday, the report turned into four paragraphs written from the standpoint of certain island residents which made it seem like no big deal. Both AP reports don’t convey the severity of the Chavez’s action found in a Reuters report on the same topic.

Here are key paragraphs from the initial longer AP report (bolds are mine throughout):

Venezuela’s Chavez says houses and inns on idyllic Caribbean island to be expropriated

… Chavez offered no details regarding the planned seizures of private homes and quaint inns, known in Spanish as “posadas.”

“There are some houses that were illegally built. We’re going to take them over,” he said on television from the presidential palace.

The president said the government would build state-run inns on Los Roques, which is an archipelago of tiny islands offering snorkeling and scuba diving along numerous coral reefs and deserted white-sand beaches.

Lying 95 miles (150 kilometers) off the mainland, Los Roques is immensely popularly with foreign tourists seeking natural beauty and tranquility.

Here’s the later, not-to-worry item:

Venezuelan islanders say expropriation affects few

Most residents of Venezuela’s Los Roques archipelago don’t seem concerned by President Hugo Chavez’s announcement that his government will expropriate homes on the Caribbean islands.

They say the measure will affect only a few property owners.

Some residents on the archipelago’s neighborhood-based assembly say they had expected Thursday’s announcement and don’t fear their homes or inns will be targeted for state takeover.

I would suspect that it won’t be too long before we can file the bolded sentence above under “famous last words.”

Chavez says some homes on Los Roques were built on plots bought in shadowy business deals and will be seized by the state.

The problem is that even AP’s original report, which gave the impression that Chavez intends to be selective, is not consistent with how Andrew Cawthorne at Reuters described it:

Chavez eyes Venezuela tourist islands for takeover

President Hugo Chavez said his government would seize private homes on the idyllic Los Roques archipelago in the Caribbean and use them for state-run tourism in the latest move to implant socialism across Venezuela.

“I’ve always said we should nationalize Los Roques,” the ever-pugnacious Chavez said, making the announcement in a telephone call to state television late on Wednesday.

Lying just north of Venezuela’s coast, Los Roques’ dozens of islands are one of the South American nation’s favorite — and most expensive — tourist spots, with pristine white sand beaches, coral reefs and teeming sea life.

… The 57-year-old leader, who is mainly communicating with the nation by phone calls to state media during his convalescence after cancer treatment, said the government would build hostels on Los Roques “for the people.”

Yachts confiscated from fugitive bankers would be used to transport tourists, he added.

Representatives of property owners on Los Roques could not be immediately reached for comment.

As a state-administered national park, it is unclear how people have been able to obtain property there.

The bolded sentence makes it look like he wants the whole, uh, enchilada, doesn’t it?

If you ever wondered why Hugo Chavez’s authoritarian actions don’t get mentioned much in U.S. news coverage, you need look no further than how the Associated Press consistently downplays — and then further waters down — what he says and does.

Cross-posted at NewsBusters.org.

AP Story on ‘Discrimination’ Against Long-Term Unemployed IDs No Jobless Support for Legislation, Never Notes Why It’s a Problem

unemployment-officeThe headline this afternoon at the Associated Press to a report by Sam Hananel attempted to create the impression that complaints by many who have been unemployed for an extended time period that many employers are reluctant to consider and sometimes even refuse to consider their employment inquiries and applications equals support for provisions in President Obama’s American Jobs Act which would for all practical purposes make them another protected class.

No doubt there is some support for the (in my opinion) misguided notion, but Hananel’s underlying report never quoted an actual long-term unemployed person supporting the idea. The AP reporter also completely failed to tell readers why the problem has reached an unprecedented post-Depression level, namely that the economy, largely due to failed public policy choices, has thus far taken three times as long to recover from its recession than it did during any other post-recession period after World War II. Here are key paragraphs from Hananel’s dispatch:

Unemployed seek protection against job bias

After two years on the unemployment rolls, Selena Forte thought she’d found a temporary job at a delivery company that matched her qualifications.

But Forte, a 55-year-old from Cleveland, says a recruiter for an employment agency told her she would not be considered for the job because she had been out of work too long. She had lost her job driving a bus.

… Forte, scraping by now as a part time substitute school bus driver, is part of a growing number of unemployed or underemployed Americans who complain they are being screened out of job openings for the very reason they’re looking for work in the first place. Some companies and job agencies prefer applicants who already have jobs, or haven’t been jobless too long.

She could get help from a provision in President Barack Obama’s jobs bill, which would ban companies with 15 or more employees from refusing to consider – or offer a job to – someone who is unemployed. The measure also applies to employment agencies and would prohibit want ads that disqualify applicants just because they are unemployed.

Should the bill fail, Democrats are sure to remind jobless voters that the GOP blocked an attempt to redress discrimination against them at a time when work is so hard to find.

The effort to protect the unemployed has drawn praise from workers’ rights advocates, but business groups say it will just stir up needless litigation by frustrated job applicants. The provision would give those claiming discrimination a right to sue, and violators would face fines of up to $1,000 per day, plus attorney fees and costs.

… A survey earlier this year by the National Employment Law Project found more than 150 job postings on employment Web sites such as CareerBuilder.com and Monster.com requiring that applicants “must be currently employed” or using other exclusionary language based on current employment status.

… The issue has gained more prominence as the unemployment level remains stuck over 9 percent and a record 4.5 million people – nearly one-third of the unemployed – have been out of work for a year or more.

… The practice has also drawn concern from the Equal Employment Opportunity Commission, where members at a hearing earlier this year said barring unemployed people from employment may have a greater effect on blacks and Hispanics with higher jobless rates.

Later, Hananel reported that the temp agency, Kelly Services, “said the company does not discriminate on any basis,” while a Fedex spokesperson “said her company has no policy barring the unemployed from seeking a job and never instructed the temp agency to discriminate,” claiming that “There was obviously confusion on the part of the temp agency.” One could argue that there was a lot of behind-covering going on, but it remains the case that Hananel used an unprovable episode as the anecdotal basis for his story, and never quoted any unemployed person (including Forte) about whether they would support the American Jobs Act provision treating the long-term unemployed as a de facto protected class.

Equally relevant, Hananel never told readers why the issue, which has always been a problem for people out of work for a long time, is more serious than ever. That’s because there has never been a “recovery” (assuming we actually get there, which is not yet a given) which has taken so long:


The graphic on the left, obtained from Investor’s Business Daily, shows that in every other post-recession or post-downturn recovery after World War II, the economy returned to where it was before the downturn began within one, two, or at most three quarters — until this time, where IBD shows that we’re at eight quarters and counting (i.e., we won’t be at full recovery until at least Quarter 9, if then). The graphic at the right proves that as of June 30, we’re not there yet.

In what turned out to be a somewhat controversial column back in March (“Unemployed Need Not Apply — Thanks to Obamanomics”; originally run under a different title at Pajamas Media; bolds are mine in this post), I wrote that there are several quite rational reasons why businesses are inclined to hire those who are still working or have been unemployed for only a short time:

If a person is already working somewhere else, they’re demonstrating that on a daily basis, not in the recent or sometimes distant past, their work habits and output are more than likely satisfactory to someone else. There’s at least a decent chance that this person has kept his or her skills sharp, and has kept up with technological and market developments in the industry. The effort involved in training such a person in their new job will often be fairly minimal. There will also be a lower likelihood that the person will flunk a background check, credit check, or their drug test.

With the unemployed, especially the long-term unemployed, the situation completely flips. Work habits and attitudes, even if once great, become suspect. Skills may have eroded. On the job training efforts are more likely to be substantial, take longer to stick, and are more likely to fail. The chances that the new person will steal because of financial hardship, has gotten into legal trouble while unemployed, or has fallen into substance abuse are all greater.

Employers who are avoiding the unemployed are merely saying, “We only have so much time and energy to put into a job search, and we can’t afford to make a business mistake. So we’re going to avoid considering the unemployed to reduce the chances of making such a mistake.” Contrary to the belief of those who apparently feel that it’s somehow an employer’s duty to hire the unemployed, and despite the fact that bad decisions to overwork current staff or to abandon necessary tasks are often made, there is nothing wrong with this. It’s about survival.

That this is not at all comforting to the unemployed who are aggressively looking for work is undeniable. Those who are in that position through no real fault of their own have every reason to be angry that they and millions of other Americans are in the same position. But they should not be mad at employers. They should be mad as hell at their government. It is their government … which deliberately chose to create a high-unemployment economy.

To those who argue that the government didn’t “deliberately” chose the current high-unemployment economy, I would contend that the administration, by consciously choosing massive “stimulus” instead of other options, employed a strategy last seen in the 1930s, which was also a high-unemployment economy. In the 1930s, the unemployment rate never dropped below 12%. In every other case since World War II, even the dreadful early 1980s, different strategies were employed which achieved far better results. The massive “stimulus” strategy may not have been “deliberate” in intent, but it was certainly a deliberate choice, and its pathetic outcome was eminently predictable.

As to the long-term unemployed, the individual suggestions about networking, pounding the pavement and considering self-employment, obviously still apply. But on a broader level, nothing will cure the problem like a prospering economy. The American Jobs Act provisions supposedly helping the long-term unemployed will do nothing helpful, unless one thinks that creating a new trial lawyers’ bonanza, driving employers’ searches for workers further underground, making businesses reluctant to grow about the 15-employee threshold identified in the AP report, holding back overall hiring, and throwing up yet another barrier to sustained long-term economic growth are good things. Obviously, they aren’t.

But, as Hananel cynically indicated, while it won’t really help the long-term unemployed, it may buy votes.

Cross-posted in revised form in two posts (here and here) at NewsBusters.org.

Sunday Off-Topic (Moderated) Open Thread (100911)

Filed under: Lucid Links — Tom @ 12:57 pm

Rules are here.

Latest Pajamas Media Column (‘This Isn’t ‘Lending’ — It’s More Like Looting; Solyndra’s unlearned lessons’) Is Up (Also: Other Developments)

Filed under: Business Moves,Economy,Scams,Taxes & Government — Tom @ 11:06 am

solyndra_thumb_0It’s here.

It will to up here at BizzyBlog on Tuesday morning (link won’t work until then) after the blackout expires.

Updates and developments: The frustrating thing about writing a column like this requiring someone else’s review is that something else story-related will almost definitely happen before it gets published — and you have to hope that nothing will come out making it all look like old news. Luckily, the “old news” part didn’t happen, but there have been lots of new developments since submission (besides one I was able to add in thanks to the patience of PJM editors).

(To show how short the news cycle now is, note that no Solyndra-related story is a topic a the 9:55 a.m. version of Mememorandum (though it is mentioned in passing in a generalized story about corruption).

What follows are links and brief descriptions of a few recent related stories.


Washington Post, Oct. 7 — “Solyndra loan deal: Warning about legality came from within Obama administration”:

Energy Department officials were warned that their plan to help a failing solar company by restructuring its $535 million federal loan could violate the law and should be cleared with the Justice Department, according to newly obtained e-mails from within the Obama administration.

The e-mails show that Energy Department officials moved ahead anyway with a new deal that would repay company investors before taxpayers if the company defaulted.

… The records provided Friday by a government source also show that an Energy Department stimulus adviser, Steve Spinner, pushed for Solyndra’s loan despite having recused himself because his wife’s law firm did work for the company.

A particularly damning sequence, in my view:

  • On August 19, 2009, an aide to then-Obama chief of staff Rahm Emanuel asked Spinner about concerns in the investment community about Solyndra.
  • His response was, per WaPo, that “I haven’t heard anything negative on my side.”
  • Yet nine days later (this is yours truly reading from experience between the lines), he was screaming in an email as if the company might not be able to meet its next payroll: “How [expletive] hard is this? … What is he waiting for? Will we have it by the end of the day?”

But of course, there’s no accountability in Lefty-Land: “Spinner is now a fellow at the Center for American Progress, a Democratic think tank.”


It will be interesting to see how the Obama admin handles this demand:

GOP Solyndra probe wants Obama’s BlackBerry messages

The GOP’s demand for all White House communications on Solyndra covers President Barack Obama’s personal BlackBerry messages too, Rep. Cliff Stearns said Thursday.

The Florida Republican said he made the precedent-setting request to White House Counsel Kathryn Ruemmler on Wednesday after newly released emails showed that warning flags about the California solar company’s shaky finances had reached into the president’s inner circle, including senior adviser Valerie Jarrett.

The pic caption at the Politico story reads: “Obama fought his lawyers early in his term to become the first president to use a BlackBerry.”

The guess here is that any relevant messages have long since been deleted and are now irretrievable — which is why Obama wanted so badly to keep using his Blackberry in the first place. Then the question would become whether his deletions were illegal under a relevant federal recordkeeping statutes. He likely know this episode from the Clinton administration:

The dog ate their e-mail

In fact, in June 1998, at the very moment the Lewinsky investigation had reached a feverish pitch, computer technicians told White House lawyers, who were in charge of complying with subpoenas issued by the various investigative bodies, that a major computer glitch had rendered at least 100,000 e-mail messages temporarily irretrievable.

I question whether it was really a “glitch” which rendered the emails irretrievable. Fast-forwarding to today, Obama wouldn’t want to take a chance on retrievable emails. That’s why he was so insistent on having the “personal” Blackberry.


Jonathan Silver, the “director of the Energy Department program that guaranteed” the Solyndra loans, resigned on Thursday.

Before he left, he apparently did all he could to ensure that future Solyndras occur:

The administration was quick to say Thursday that Silver’s resignation was not in response to congressional demands.

Reps. Fred Upton (R-Mich.) and Cliff Stearns (R-Fla.) — the leaders of the congressional investigation into the Solyndra deal — said Silver’s departure did not repair the damaged program or return taxpayer money to the government.

“Mr. Silver’s resignation does not solve the problem,” they said in a statement. “We are in the midst of the Solyndra investigation and just days removed from Mr. Silver’s mad rush to finalize the last $4.7 billion in loans before the statutory deadline.”


This is datelined before the column was submitted, but was kept out because of its potentially rapidly developing nature:

White House Knew Solyndra Investment Risks

Senior White House officials understood the risks of committing taxpayer dollars to Solyndra but proceeded anyway, according to internal Obama administration email transcripts released today.

Valerie Jarrett, Ron Klein (Joe Biden’s chief of staff), and Larry Summers are among those who were warned.


You don’t say? CNN, 13 months ago on August 26, 2010:

But there are plenty of warning signs surrounding the venture. Solyndra filed in December for an initial public offering, but two months ago it cancelled those plans. It’s far from profitable and burning through cash: Solyndra is losing money on every solar panel it sells, and its cost of production is higher than most of its competitors’.

Some analysts think the once red-hot venture’s star is dimming.


Finally, Business Insiders’s “8 Red Flags The Government Totally Ignored In The Solyndra Disaster.” It goes back two weeks, but includes a potentially explosive final item of which I was unaware at the time of submission:

  1. Solyndra’s business model was totally flawed.
  2. There was no demand for what Solyndra was making.
  3. Solyndra was already bleeding cash.
  4. Solyndra spent more than $1.8 million to lobby for the loan.
  5. The loan funded a new state-of-the-art factory that Solyndra didn’t need.
  6. And (funded) equipment no one knew how to build.
  7. Even Solyndra’s own accountant knew the company was going broke.
  8. Even when Solyndra execs came clean, the government stuck with the company.

If the execs really did come clean, that situation may actually justify why its execs took the Fifth in front of a congressional committee.

Positivity: Windmill brings life to Kenyan village

Filed under: Positivity — Tom @ 8:59 am

From Nakuparat, Kenya:

Sep 28, 2011 / 12:56 am

Mixed with the braying of livestock and the welcome laughter of children, a new sound swirls above the village of Nakupurat in Kenya these days. It is the steady creaking of a windmill. For villager Ekiru Ewoi and the 2,000 residents here, it is a sound that reminds them daily that the hard days of thirst have passed.

“When the windmill was broken, we were going to the river,” Ekiru says. “That took the whole day, from morning to evening, to get water.”

Like many in Kenya’s Isiolo District today, the villagers of Nakupurat have been hit by the drought gripping the country. More than three million people across Kenya are directly affected, many of them pastoralists like Ekiru whose lives depend on the grasses their livestock need to stay healthy.

Staying alive became more difficult in 2009, when the windmill that pumps water from a well in Nakupurat broke. With the next closest water source miles away in the muddy waters of the Ewaso Nyiro River, the effect on Nakupurat was catastrophic. Young men herded their livestock to greener pastures and the village school closed, forcing children to walk nearly seven miles each way to attend class at a neighboring school. Elders like Ekiru, too old to join the young men in their search for forage, struggled each day to make the arduous journey to the river.

“I used to take the livestock to the river myself,” Ekiru says. “I was becoming very tired on those trips, and I was suffering from hunger and joint pain.”

But in July 2011, the blades of Nakupurat’s windmill began spinning again, thanks to Catholic Relief Services and its partner agency, the Vicariate Apostolic of Isiolo. Together, they’re rehabilitating 27 water sources across the Isiolo District. It’s all part of the 6-month Isiolo Emergency Response project. Through it, the relief service is rehabilitating sand dams, shallow wells and the Nakupurat windmill as a way to provide immediate relief for Kenyans affected by drought.

For the villagers of Nakupurat, the effect has been dramatic. With clean water readily available, villagers wash more often and report that ailments common in areas of drought, such as diarrhea and worms, are greatly reduced. For the livestock on which these pastoralists depend, easy access to water has had an equally dramatic effect. …

Go here for the rest of the story.