Wednesday, April 14, 2010

Barker's Newsbites: Wednesday, April 14, 2010


You folks know the drill...
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13 comments:

William R. Barker said...

http://taxpayer.net/resources.php?category=&type=Project&proj_id=3419&action=Wastebasket

The release this week of the long-awaited road map for U.S. nuclear weapons policy was met by some cheers for its commitment to arms reductions. But a close read reveals...

(*DRUM ROLL*)

To see where policy is really headed just follow the money. The White House’s FY 2011 budget released in February gave $11.2 billion to the National Nuclear Security Administration - the highest ever for the agency, which manages our nation’s nuclear arsenal as well as associated laboratories and facilities. Money specifically allotted to weapons-related activities got a 10% bump to $7 billion.

[A] lot of this money is going toward efforts that seem to oppose Obama’s stated nuclear policy goals. For example, funding for a “life extension program” for a certain type of warhead will triple to $317 million despite the fact that several countries in Europe, where many bombs carrying the warheads are based, want to get rid of them.

Perhaps more troubling for taxpayers is the 30% boost for facilities construction. The NPR states that this spending is necessary because the complex of nuclear labs and facilities has fallen into disrepair. Okay, but the two projects the document identifies as priorities - one in New Mexico and one in Tennessee - seem unnecessary in light of recent developments.

* HMM...

The budget for the Chemistry and Metallurgy Research Facility Replacement (CMRR) at Los Alamos National Laboratory has more than quadrupled in recent years, and that’s before design plans have even been finalized. The scope of the building was called into question with the cancellation of the Reliable Replacement Warhead, which would have been developed there.

* HMM...

And the planned $3 billion Uranium Processing Facility at the Y12 plant in Oak Ridge, Tennessee, would also produce parts for weapons we don’t need.

* HMM... AT THE VERY LEAST, QUITE CURIOUS... (*SHRUG*)

April 14, 2010 at 11:06 AM
William R. Barker said...

http://blog.heritage.org/2010/04/14/morning-bell-wall-street-bailouts-forever/?utm_source=Newsletter&utm_medium=Email&utm_campaign=Morning%2BBell

There is no person more central to Washington’s bailouts of Wall Street than Treasury Secretary Timothy Geithner.

As President of the Federal Reserve Bank of New York, he oversaw the federal bailout of Bear Stearns and under former Treasury Secretary Hank Paulson, Getihner designed the original bailout plan for the American International Group (AIG).

As Treasury Secretary, Geithner has enthusiastically assumed full authority over the $700 billion TARP fund first secured by Paulson under President Bush and he has continued to wield it in the same haphazard manner as his predecessor.

Considering these facts, one might think that the Obama administration would be shy about making the personification of Washington’s Wall Street bailouts the front man for their supposed financial reforms. But no, Secretary Geithner took to the op-ed pages of The Washington Post yesterday to make the case for the President’s version of finance reform.

* BTW... IF YOU CLICK ON THE ABOVE-PROVIDED LINK AND READ DIRECTLY FROM THE ORIGINAL, ALL THE VARIOUS LINKS EMBEDDED WITHIN THE PIECE WILL BE OPEN TO YOU.

But does the Senate bill’s “bankruptcy-like regime” solve the “too big to fail” problem?

No. In fact it makes it worse.

* I'VE NOTED THIS BEFORE, BUT THE FACTS BEAR REPEATING...

What the Dodd bill actually does is create a new $50 billion fund to be used in “emergencies” for restructuring firms deemed too close to bankruptcy. And who gets to decide when there is an emergency and which firms are too close to bankruptcy? You guessed it: Treasury Secretary Timothy Geithner.

(*SNORT*)

The Dodd bill is thus nothing but a permanent extension of Secretary Geithner’s TARP powers.

(*SMIRK*)

[T]he Obama administration’s finance plan further empower the exact same bureaucrats who failed to prevent the last crisis, it also makes it more likely that those same institutions that made risky bad bets before will make the exact same mistakes again. ... [G]overnment bailouts increase the moral hazard that leads to “too big to fail” policies ... By establishing a permanent Geithner-controlled “emergency” fund, Wall Street creditors will know they never have to watch over their counterparts: if things go bad, their buddy Geithner will have their backs.

[I]t is “the big Wall Street banks” that are supporting the Geithner permanent bailout plan. In their annual letter, current Goldman Sach’s CEO Lloyd Blankfein and President Gary Cohn make the case for more Washington regulation. ... Obama raised about a million dollars from Goldman Sachs employees and executives in 2008, the most any politician has raised from a single company since McCain-Feingold. And the Obama administration employs many Goldman alumni/lobbyists including Chief of Staff Rahm Emanuel, White House economic advisor Larry Summers, and Treasury Chief of Staff Mark Patterson.

April 14, 2010 at 1:12 PM
William R. Barker said...

http://www.washingtonpost.com/wp-dyn/content/article/2010/04/13/AR2010041303067_pf.html

* WOW...!!! LET ME PREFACE THIS BY REPEATING... WOW...!!! (FOLKS... THIS IS WRITTEN BY DANA MILBANK! YES... THAT DANA MILBANK... DANA MILBANK OF THE WASHINGTON POST!)

World leaders arriving in Washington for President Obama's Nuclear Security Summit must have felt for a moment that they had instead been transported to Soviet-era Moscow.

They entered a capital that had become a military encampment, with camo-wearing military police in Humvees and enough Army vehicles to make it look like a May Day parade on New York Avenue, where a bicyclist was killed Monday by a National Guard truck.

In the middle of it all was Obama - occupant of an office once informally known as "leader of the free world" - putting on a clinic for some of the world's greatest dictators in how to circumvent a free press.

The only part of the summit, other than a post-meeting news conference, that was visible to the public was Obama's eight-minute opening statement, which ended with the words: "I'm going to ask that we take a few moments to allow the press to exit before our first session."

Even the Chinese president, Hu Jintao, was more talkative with the press than Obama. Michelle Jamrisko, with Japan's Kyodo News, noted in her pool report that Hu, at his session with Obama, spoke to the Chinese media in Chinese, while Obama limited himself mostly to "say hello to the cameras" and "thank you everybody."

Obama's official schedule for Tuesday would have pleased China's Central Committee. Excerpts: "The President will attend the Heads of Delegation working lunch. This lunch is closed press. . . . The President will meet with Prime Minster Erdogan of Turkey. This meeting is closed press. . . . The President will attend Plenary Session II of the Nuclear Security Summit. This session is closed press."

Reporters, even those on the White House beat for two decades, said these were the most restricted such meetings they had ever seen.

The restrictions have become a common practice for the Obama White House. When Israeli Prime Minister Binyamin Netanyahu came to the White House a couple of weeks ago, reporters were kept away. Soon after that, Obama signed an executive order on abortion, again without any coverage.

In "bilateral" meetings with foreign leaders, presidents usually take questions, or at least trade statements. But at most of Obama's, there were only written "readouts." Canada: "The president and the prime minister noted the enduring strength of our bilateral partnership." India: "The two leaders vowed to continue to strengthen the robust relationship between the people of their countries." Pakistan: "President Obama began by noting that he is very fond of Pakistan."

* WOW... DANA FRIGG'N MILBANK... JUST... WOW...

April 14, 2010 at 2:08 PM
William R. Barker said...

http://www.ft.com/cms/s/0/7d8f961e-4725-11df-b253-00144feab49a.html

Cattle futures have risen more than 20% since December and are again flirting with $1 a pound, a milestone previously reached during the commodity price rise of 2008.

“It may be the biggest rally in fed cattle prices from December till April in the last 30 years,” said James Herring, president of Friona Industries, a Texas feedlot operator that supplies Cargill, the US agribusiness group.

Worldwide, beef and veal production is heading for a third straight year of decline, according to the US Department of Agriculture.

CME cattle futures on Tuesday were 98 cents a pound, almost 25 per cent higher than lows late last year. Hog futures have also gained after pork producers slashed supply.

Rising beef prices are likely to translate into higher prices...

* YA FRIGG'N THINK SO...?!?! (*SMIRK*) GAS AND FOOD, KIDS... GAS AND FOOD...

“The underlying cost is the driver to eventual price increases,” said Matthew DiFrisco, executive director of equity research at Oppenheimer & Co.

Oppenheimer estimates that ground beef accounts for 10% or higher of McDonald’s costs of goods sold. Steakhouse chains, from Texas Roadhouse in the middle market to Morton’s at the high end, have a higher exposure to beef costs – as much as 40%, said Mr DiFrisco.

* AND SUPERMARKETS...??? POINT OF SALE TO THE CONSUMER...??? (JEEZUS... YOU'RE TELLING ME THE EDITOR DIDN'T CATCH THIS HUGE WHOLE IN THE STORY?)

April 14, 2010 at 2:30 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052702304798204575183681842082638.html?mod=WSJ_hps_sections_markets

Crude prices climbed as a drop in U.S. oil inventories signaled that the supply glut may be easing.

* YES, FOLKS... AS PREVIOUSLY COMMENTED ON - AGAIN AND AGAIN IN FACT - THE OIL PRICE SURGES OF THE PAST MONTHS HAVE OCCURRED DURING A PERIOD OF OIL SUPPLY GLUT! SO... JUST IMAGINE WHAT THE "EASING OF THE GLUT" WILL MEAN.

Wednesday, light, sweet crude for May delivery settled $1.79 higher, or 2.1%, at $85.84 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures exchange settled $1.43 higher, or 1.7%, at $86.15 a barrel.

"What you're seeing is the reignition of the rally that drove us to $87," said Gene McGillian, an analyst with Tradition Energy in Stamford, CT.

* NOW WHAT WAS I JUST SAYING ABOUT FOOD AND OIL, FOLKS... (*SNORT*) (*MIRTHLESS CHUCKLE*)

April 14, 2010 at 4:38 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052702304159304575183383654837248.html?mod=WSJ_hps_sections_world

For five years, U.S. troops fought their way up and down the cedar-studded slopes of [Afghanistan's] Korengal Valley.

The ferocity of the fighting inspired a videogame scenario, thrust the remote valley into the media glare, and famously forced a soldier to fight in his underwear.

In all, 42 U.S. troops have been killed here.

On Wednesday, the fight for Korengal officially ended when the final U.S. soldiers were airlifted from a ridge above this collection of stone buildings, sandbagged bunkers and jury-rigged plumbing built up on the grounds of a former lumber mill. The Americans pulled out because they determined that instead of bringing a measure of stability to Korengal, they had largely proven "an irritant to the people," said the top U.S. commander in Afghanistan, Gen. Stanley McChrystal.

"We're not living in their homes, but we're living in their valley," Gen. McChrystal said on a visit to Korengal last week as the withdrawal was getting under way. "There was probably much more fighting here than there would have been" if U.S. troops had never come.

American officials say the exit from Korengal represents neither a victory nor a loss...

* YEP. YOU READ THAT RIGHT. IN FACT... YOU'VE READ THE WHOLE THING RIGHT SO FAR. (*SIGH*)

U.S. forces have already pulled out of much of Nuristan province to the north, where last year eight American soldiers were killed when two of their bases were stormed by insurgents. More withdrawals are planned.

* READ THE FULL ARTICLE FOLKS; TELL ME IT DOESN'T SCREAM "VIETNAM" TO YOU.

April 14, 2010 at 4:38 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052702303828304575180043371260452.html?mod=WSJ_Opinion_LEFTTopOpinion

The state of California's real unfunded pension debt clocks in at more than $500 billion, nearly eight times greater than officially reported.

That's the finding from a study released Monday by Stanford University's public policy program, confirming a recent report with similar, stunning findings from Northwestern University and the University of Chicago.

For a glimpse of California's budgetary future, look no further than the $5.5 billion diverted this year from higher education, transit, parks and other programs in order to pay just a tiny bit toward current unfunded pension and healthcare promises. That figure is set to triple within 10 years and - absent reform - to continue to grow, crowding out funding for...

* NOW THAT'S THE QUESTION, ISN'T IT... WE'LL SEE HOW CALIFORNIA "PRIORITIZES" THE CUTS FROM OTHER PROGRAMS...

What can we do about this? For the promises already made, nothing. They are contractual, and because that $500 billion of debt must be paid, retirement costs will rise dramatically no matter what we do. But we can reduce the sizes of promises made to new employees and require full and truthful disclosure so that pension debt can never again be hidden.

Last summer Gov. Arnold Schwarzenegger proposed exactly that. Since then? Silence. State legislators are afraid even to utter the words "pension reform" for fear of alienating what has become - since passage of the Dills Act in 1978, which endowed state public employees with collective bargaining rights on top of their civil service protections - the single most politically influential constituency in our state: government employees.

Because legislators are unwilling to raise issues that might offend that constituency, they have effectively turned the peroration of Abraham Lincoln's Gettysburg Address on its head: Instead of a government of the people, by the people and for the people, we have become a government of its employees, by its employees and for its employees.

April 14, 2010 at 4:38 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052702304168004575177910000899010.html

According to the most recent IRS data, the top 5% of earners bring in 37% of the income but pay 60% of the federal individual income taxes.

The bottom half of earners bring home 12% of the income but pay 3% of the taxes.

Today, according to the Tax Foundation, 60% of Americans consume more in government services than they pay in taxes.

* THIS IS A RECIPE FOR DISASTER, FOLKS...

April 14, 2010 at 4:39 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052702303695604575182333308913608.html

[A]n executive order President Obama signed within weeks of taking office went live yesterday. It encourages federal agencies to require "project labor agreements" for all construction projects larger than $25 million.

This means that only contractors that agree to union representation are eligible for work financed by the U.S. taxpayer.

Only 15% of the nation's construction workers are unionized, so from now on the other 85% will have to forgo federal work for having exercised their right to not join a union.

This is a raw display of political favoritism, and at the expense of an industry experiencing 27% unemployment.

It's also a rotten deal for taxpayers. ... [T]he carve-outs put an end to open, competitive federal bidding, which means higher project costs.

Boston's Big Dig, Seattle's Safeco field, Los Angeles's Eastside Reservoir project, the San Francisco airport, Detroit's Comerica Park - all were built under project labor agreements marked by embarrassing cost overruns.

April 14, 2010 at 4:39 PM
William R. Barker said...

http://www.zerohedge.com/article/benefits-contract-abrogation-according-mark-zandi-6-million-people-not-making-mortgage-payme

* FROM ONE OF MY FAVORITE BLOGS - ZERO-HEDGE.COM!

We have disclosed on numerous occasions how excess refunds by the Federal Government despite subpar withholdings is goosing up consumer spending.

Now we hear from none other than Mark Zandi of Moody's Economy that the government's tacit encouragement for "homeowners" to not pay their mortgage dues is freeing up $8 billion each month that is artificially increasing consumer spending and iPad preorders.

And with banks not marking anything to market, all these houses that generate no cash flow are still marked at 100 cents on the books.

If you ever needed a justification to not pay your credit card, your mortgage, or anyone else you owe money, now you know - contract law in America no longer exists. Just stop paying everything.

And please don't save. Saving is for non-banana republics.

April 14, 2010 at 7:55 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052702303695604575182022093645864.html?mod=WSJ_hps_LEFTWhatsNews

Morgan Stanley has told investors in its $8.8 billion real-estate fund that it may lose nearly two-thirds of its money from bum property investments, according to fund documents reviewed by The Wall Street Journal.

That would likely make it the biggest dollar loss - $5.4 billion - in the history of private-equity real-estate investing.

Morgan Stanley now is negotiating with lenders to reduce the fund's obligations on the money it borrowed, its interest payments, renovation costs and other expenses.

* OH, YEAH, FOLKS... (*SNICKER*)... THE ECONOMY IS DEFINITELY TURNING THE CORNER! (*LAUGHING OUT LOUD*)

April 14, 2010 at 7:56 PM
William R. Barker said...

http://www.nytimes.com/2010/04/15/business/15mortgages.html

The number of homeowners who defaulted on their mortgages even after securing cheaper terms through the government’s modification program nearly doubled in March, continuing a trend that could undermine the entire program.

* BY "GOVERNMENT'S MODIFICATION PROGRAM" THE TIMES MEANS OBAMA'S PROGRAM CHAMPIONED BY NANCY PELOSI AND HARRY REID AND PASSED BY A DEMOCRATIC HOUSE AND SENATE.

The Treasury Department said it could not explain...

* SWEAR TO GOD! THAT'S THE QUOTE! YEP... NYT - NOT THE ONION... (*CHUCKLE*)

...the growing number of what it called cancellations, almost all of which were apparently prompted by the borrower’s being unable to make the new payment.

* SO I'LL EXPLAIN IT TO THE TREASURY DEPARTMENT: THEY EITHER COULDN'T OR WOULDN'T MAKE GOOD ON THEIR DEBT. (*SHRUG*)

About seven million households are behind on their mortgage payments.

* OH, YEAH... THE ECONOMY IS "COMING BACK" IN LEAPS AND BOUNDS! (*SMIRK*)

Julia R. Gordon, senior policy counsel for the Center for Responsible Lending in Washington, said she expected the number of post-modification defaults to continue to rise. “It’s definitely alarming to look at those statistics,” she said. “The current model for modifications doesn’t necessarily produce sustainable results.”

60% of modifications undertaken by banks in late 2008 were in default a year later, according to the latest Mortgage Metrics Report compiled by the Office of Thrift Supervision and the comptroller of the currency. Loans for which the payments were decreased by at least 20% failed at a ...rate of about 40%

(*SARCASTIC CLAPPING*) BRAVO, OBAMA ADMINISTRATION; BRAVO!

April 14, 2010 at 9:30 PM
William R. Barker said...

http://news.cnet.com/8301-13578_3-20002423-38.html

Google and an alliance of privacy groups have come to Yahoo's aid by helping the Web portal fend off a broad request from the U.S. Department of Justice for e-mail messages, CNET has learned.

In a brief filed Tuesday afternoon, the coalition says a search warrant signed by a judge is necessary before the FBI or other police agencies can read the contents of Yahoo Mail messages - a position that puts those companies directly at odds with the Obama administration.

Tuesday's brief from Google and the other groups aims to buttress Yahoo's position by saying users who store their e-mail in the cloud enjoy a reasonable expectation of privacy that is protected by the U.S. Constitution.

"Society expects and relies on the privacy of e-mail messages just as it relies on the privacy of the telephone system," the friend-of-the-court brief says. "Indeed, the largest e-mail services are popular precisely because they offer users huge amounts of computer disk space in the Internet 'cloud' within which users can warehouse their e-mails for perpetual storage."

For its part, the Justice Department has taken a legalistic approach: a 17-page brief it filed last month acknowledges that federal law requires search warrants for messages in "electronic storage" that are less than 181 days old. But, Assistant U.S. Attorney Pegeen Rhyne writes in a government brief, the Yahoo Mail messages don't meet that definition.

"Previously opened e-mail is not in 'electronic storage,'" Rhyne wrote in a motion filed last month. "This court should therefore require Yahoo to comply with the order and produce the specified communications in the targeted accounts." (The Justice Department's position is that what's known as a 2703(d) order--not as privacy-protective as the rules for search warrants--should let police read e-mail.)

* THAT'S A RIDICULOUS ARGUMENT IN MY OPINION. (AND IF THAT WAS THE BUSH ADMINISTRATION'S ARGUMENT IT WAS RIDICULOUS THEN TOO!)

On December 3, 2009, U.S. Magistrate Judge Craig Shaffer ordered Yahoo to hand to prosecutors certain records including the contents of e-mail messages. Yahoo divulged some of the data but refused [absent actual specific warrant] to turn over e-mail that had been previously viewed, accessed, or downloaded and was less than 181 days old.

"This case is about protecting the privacy rights of all Internet users," a Google representative said in a statement provided to CNET on Tuesday. "E-mail stored in the cloud should have the same level of protection as the same information stored by a person at home."

That is, in fact, the broader goal of the groups filing Tuesday's brief. They're also behind the new Digital Due Process Coalition, which wants police to be able to obtain private communications (and the location of Americans' cell phones) only when armed with a search warrant.

The judge should "reject the government's attempted end-run around the Fourth Amendment and require it to obtain a search warrant based on probable cause before searching and seizing e-mails without prior notice to the account holder," the coalition brief filed Tuesday says.

April 14, 2010 at 9:37 PM

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