Category regulation

Jun 9 2015

Is Tenure important? Yes. Here’s why…

Tenure is one of the more controversial benefits offered to educators in the United States, in particular. Teachers who are “tenured” often are difficult to discipline constructively if they commit violations — even some severe violations.

But when examining the benefits, it becomes clear that Tenure is necessary for a classroom that is as little motivated by external politics as possible.

Consider the fact that Governors often appoint Regents to the University’s management board. This function allows the Governor to effectively control policy at a State school of learning, by and through his appointees to the Board of Regents. While this in and of itself doesn’t sound overly daunting, consider the following:

Consider an instructor teaching a course in a college the Governor appoints Regents to, and this instructor teaches philosophy contrary to the opinions of the Governor. The Governor finds this out, and wishes to see that this employee is somehow sanctioned; which he could theoretically do through his Regent appointees, because the Chief Executive of the State often has the power to “unappoint” individuals, as these individuals often serve at the pleasure of the Governor. The Regent could feel pressured to sanction the employee in some way, including not approving a new contract of which the employee is a part. Regardless of the issue, it gives one individual a LOT of power — that power being the Governor’s.

Without Tenure protections, teachers who teach “politically inconvenient” subjects or topics could find themselves in very serious trouble — and even fighting for their job. With this type of pressure in mind, is a teacher able to remain unbiased from external forces when building a lesson plan? Maybe so, maybe no.

Tenure helps deflect issues such as these — and allows the individual teacher to teach and conduct pedagogical methods or even politically or internally unpopular ideals, methods or philosophies, with a far diminished fear of retribution.  This allows the instructor to be influenced as little as possible by external forces, including shifting political views with the times, changes in administrative or executive leadership — both internal and external to the school, and other forces that drive education.

With these things in mind, what do you think?  Should teachers be as isolated as possible from forces outside the University or School System, or should they be directly held accountable — not the school?

I’ve always believed in holding the school accountable, so schools can error-correct themselves, particularly when it comes to more simple issues such as methodology, research or general practice.   [I’m not taking into account things such as gross dereliction, or showing up to work drunk, or other massive concerns where Tenure shouldn’t count as much, I’m assuming your average, every-day teacher].  Placing individual educators under the microscope of the public, or to forces outside the institution politicizes them — and that simple act causes a change in how the teacher will function, pure and simple.

Further Reading:

NYT: Tenure Firmly in Place, but Colleges Grow Wary of Lasting Commitments

Oct 9 2014

UK begins borrowing in Chinese Yuan — dangerous thing to do?

The Treasury of the United Kingdom has noted that it has begun trading bonds in the Chinese Yuan.

Why is this a concern? The concern is two-fold: one, the currency and economy is centrally planned and manipulated in the People’s Republic of China. Not only is this in direct contradiction of the free-market model of the Western world — and not only is this validated by the Western world by sovereign funds trading in yuan; but this is also a concern of the authoritarian regime having a bigger centrally-planned grasp on Western economies, that is supposed to be relatively free from governmental controls past base consumer and business regulation.

Further, a serious concern is the manipulation of the currency itself by the Chinese government. Quite often, it depresses the yuan compared to the United States dollar, to inflate the US’ trade deficit with the PRC. Inso doing this, while it may be doing it strictly for the sake of manipulating its debt compared to the US currency, the reserve currency of the world, as it sits today — is the United States Dollar; and devaluing its currency compared to the US Dollar manipulates its value across the board. Is the United Kingdom taking a willing part in letting the PRC government manipulate its own currency and economic status by taking the yuan on as an informal reserve?

Further Reading:

– China’s currency dream gets U.K. lift
http://money.cnn.com/2014/10/09/investing/china-yuan-uk/index.html?hpt=hp_t3

May 18 2014

The Average American Taxpayer pays… WHAT?

If you’re a taxpayer in the United States, you may find it interesting how much you actually pay to businesses and other interests you already pay money to…

Thanks to some compiling by Moyers & Company, and a couple of other sources; I’ve put together a list:

– A policy analysis from the Cato Institute from 2012 shows that the United States Federal Government loses about $100 Billion a year to corporate subsidy, on everything from energy, to the food and housing industries.  With the methodology of 115 million families, that’s over $800 a year.

– The State and Local Governments themselves are different picture.  The New York Times ran an investigation that determined that State and Local (i.e., the County and City/Town level) gave on average $80 Billion.   That adds up to be almost $700 per year.

– Retirement Banking Fees are another hefty loss for taxpayers — on average costing over $350 per year; which assumes a 1% management fee per year of one’s retirement fund, and a middle-range percentile retirement fund amount as cited by the Economic Policy Institute was assumed to be about $35,000.

– A report by the International Monetary Fund reports that over $83 Billion winds up in interest payments on loans and banking.  That accounts to $722 per year.  A further sobering fact: the five wealthiest banks in the world, JPMorganChase, Bank of America, Citigroup, Wells Fargo and Goldman Sachs account for THREE QUARTERS of these subsidies!

– Overpriced Medications were a surprise to me on this list — while the notion itself was not, the amount certainly was.  A study conducted by the Center for Economic and Policy Research found that US drug patent monopolies raises the price of prescription medications in the US by over $270 Billion per year!  That translates to over $2000 per year.

– $870 per year goes to corporate tax subsidies, which total about $100 Billion per year, as mentioned by The Tax Foundation.  This includes everything from depreciation, and even experimental tax credits.

– Corporate Tax havens are a very serious problem.  Indeed, the US Public Interest Research Group found that the average taxpayer family paid $1231 per year to offset the losses by those [such as large banks and wealthy individuals] who offshore their monies to avoid taxation.

According to my calculations, that’s $4873 PER YEAR.  Almost five thousand dollars; assuming an average income of about $50,000.

Consider these numbers, when one looks at what they pay out for social programs:

– The Examiner released some information in 2012 about what Americans pay in social programs, such things as Education, etc.  A complete list can be found at that link, but leaving out the costs of Defense [as the Military Contract Industry is another racket in and of itself…], the costs turned out to be LESS than $500 PER YEAR.  This accounts for everything including Veterans Benefits spending, Housing, SSI, and even things like our contributions to the Railroad Retirement Fund!

…who should you *really* be mad at when it comes to who can’t afford what?  Where *IS* the “Big Government,” really?  I’ll let you decide.

I freely admit, I’ve abridged *some* information — mostly, related to Defense in Social Spending, but that, to me, doesn’t count…  and even then, admittedly, is only another $250 per year.  I also admit, I rounded *UP* on those figures — so the *actual* costs for Social Programs, are ACTUALLY a little lower.   But I’m a fair guy.

All of a sudden, the political cartoon above isn’t so ridiculous, is it?

I want to especially thank Moyers & Co., and Paul Buchheit for their work on compiling some of this data.

Mar 25 2014

China shields North Korea from reports, citing them “divorced from reality.”

Having not posted recently, I figured this was as good a topic as any to cover…

The People’s Republic of China, through its representative in China’s Mission in Geneva, said of a UN Report on Human Rights abuses in North Korea; that the reports of Human Rights abuses in the Democratic People’s Republic of Korea are “divorced from reality,” placing themselves in the way as a shield to the atrocities reported of North Korea, particularly their prison camps.

The report itself, made by a panel of jurists commissioned by the United Nations, specifically pointed to reports from political prison camps; and indeed, by those fortunate few who have escaped and are able to give eyewitness [and, further, often physical evidence] accounts to the regimes tactics of political imprisonment.

The government of the DPRK has stated that the reports are “a fabrication by hostile forces,” the standard-issue rhetoric when North Korea speaks in relation to critical statements made of it.

By Beijing’s willful “shielding” of North Korea’s human rights abuses, it makes one wonder if they may not take further action to shield their ally — and how far they may go to do so.

Further Reading:
– UN Report on North Korean Human Rights

Nov 27 2013

International Political Economy — What Is It and Why Does It Matter?

English: 2010 HDI (Very High) nations graph by...

English: 2010 HDI (Very High) nations graph by population size and region (Photo credit: Wikipedia)

The social science concept of International Political Economy is a measure of a nation‘s law, politics and economics — and their effect on each other, and it’s worth to the world.  While this sounds complicated, it really isn’t, particularly if you think about the simple phrase itself.

In some aspects, it’s exactly what you think of when you think of how “strong” a nation is, particularly when you compare them socio-economically.  When you hear phrases such as “Nation A is stronger than Nation X,” or “Nation C has a stronger swing in the world than Nations G, E and F.”

Why is this an important thing to consider?  This is the measure of the whole machine: politics, law, the nation’s military industrial complex, state control of the economy and political freedoms work together (…or against) the rest of the “machine” of the country.  A country can have an extremely strong military, but with little social freedoms, this could very well work against the forward momentum of the nation if it’s regime is looking forward (as most of them are…).  However, another theoretical nation with a weaker military, but a strong Gini index and a strong Human Development Index may have a stronger IPE because the Grand Strategy of the nation is more in tune with what the people want in a democratic society.

It’s a simple concept — that has a complicated and involved explanation.  There’s a lot to know.  Check it out, there’s all sorts of really cool theories.  Everything from Marxist IPE theory to Realist IPE theory.

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Sep 3 2013

Repo the Wrong House — and No Criminal Charges?

Nikki Bailey, a homeowner in West Virginia, came home to a startling discovery — moving men were in the process of cleaning out her home, because a bank had ordered it repossessed.  Like many foreclosures and home repossessions, this is an all-to-familiar story in the wake of the Great Recession.  But there’s a minor detail to this story:

MIss Bailey paid off her mortgage: 25 years ago.

While continuing to clean out her home, the representatives of the repossession company, CTM Industries, refused to disclose the name of the bank who ordered the repossession, and continued to clean out the home, taking everything she owned to the local trash dump.

A lifetime of memories in possessions taken away and virtually irretrievable, with the exception of some objects, such as a chest of drawers.  Family momentos, pictures,  and even a “Teacher of the Year” award from her local school district — all gone, thrown away by the offending company as if it were simple trash.

It turns out, CTM WAS repossessing the wrong house.  Her address on Godby Heights was over ten miles away from the home SUPPOSED to be foreclosed upon, on Godby Street, in Logan.

Even when the company admitted the mistake of address, the company still refuses to give the name of the Bank that ordered the repossession, as contacting the Bank would go a long way toward finding out who’s responsible for the botched address.  When contacted by local media, CTM refused to answer questions, and hung up.

Even more disturbing: the local prosecutor has said that criminal charges against either party (The Bank or CTM) is “unlikely,” because this was a “mistake.”

While civil and charges and penalties are still on the table, a Kanawha County Prosecutor, Mark Plants says “It’s a lot like taking someone’s luggage at the airport. If I take a black bag, a black piece of luggage, get home and realize this is not my bag — that’s not a crime. That’s an accident.”

Is it the same thing though?  Is the simple accident of taking similar luggage akin to breaking and entering, illegally, and burglarizing the home in question?  Isn’t there a procedure to follow that ensures the CORRECT home is Foreclosed and Repossessed properly?  And indeed, when done so legally, can the lender order all the stuff inside, which the Bank has no title to, simply removed and discarded like trash, without even the opportunity of the owner to reclaim it?

Could this also be an example of big money being immune from the laws of good order that the rest of us are required to follow?  Another example of how Banks were not held accountable for being responsible for the Great Recession?

Definitely disturbing.

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Aug 17 2013

The Banking System isn’t getting better — it’s getting worse.

Having worked in finance for over half a decade, and now having been involved in high finance now nearly a decade, I’ve been exposed to now only the internal workings of how credit and finance works from the inside, but I’ve studied it extensively as a matter of interest, and I see a problem developing — some if it we all know about, the other parts, not so much.

While our individual finances are improving overall, I see a big problem developing with the same system that brought it down in 2007 — unregulated banking.

In the United States, from the 1700s to the early 1900s, there was banking crash roughly every 15 years.  With the institution of strong regulation, particularly after the Stock Market Crash of 1929, the United States entered a golden age of banking.

How can this be?  With over 100 years of 15 year booms and busts, why did it all of a sudden stabilize?  Regulation.  With strong, effective regulation, bank busts came to a halt.  Not a SINGLE widespread bank bust occurred for over FIFTY years in America.

While a majority of this process took place in the 80s and 90s, the arguable beginning was the Nixon Shock; a term attributed to the end of the Bretton Woods system in the United States, when Nixon unilaterally wrote off the US Dollar’s ability to be converted into Gold; the United States Dollar became a free-floating value currency, which caused the US Dollar to become a reserve currency in many nations of the world — massively increasing it’s value.  In the 1980s, this trend continued: deregulation became the buzz word.  With more risks, banks could make more money with the same hard cash in it’s accounts.

restore-glass-steagallThe most hardcore change, in my opinion came during the Clinton administration, when Congress approved the repeal of the Glass-Steagall Act of 1933, repealed by the Gramm-Leach-Bliley Act of 1999, signed by Bill Clinton in November of that year.  This VERY important piece of legislation turned banking regulation on it’s head: Glass-Steagall was an instrument that separated Main Street banks from Wall Street banks.  In english, this means regular depositor banks (such as Bank of America, or Huntington Bank or Chase Bank) could play the stock market and make investments with depositor money that it otherwise barred from doing under the 1930s legislation, just like Investment banks and corporations can and do.

Seen as a vestige of post-Crash and pre-/post-World War II stabilizing legislation, it was, at the time, seen as unnecessary.  However, when deregulation began picking up steam in the 1980s, things happened in short order:

– The 1980s and 1990s Savings & Loan Crises: Savings and Loan thrifts were given many of the same powers as banks under deregulation legislation signed by President Carter in 1980; without the same regulations banks were subject to.  With the massive take-off of real estate lending, (outstanding mortgage debt was $700 Billion-ish in 1970, and nearly doubled to $1.2 Trillion in 1980), S&L’s took massive risks by lending out more money than they should have, on top of rising interest rates caused many institutions to fail.  This was failure to such a degree the United States had never seen.

– Repeal of Glass-Steagall Act: With the S&L failures still fresh on the minds of financiers and politicians, many argued further deregulation was required to avert such a disaster in the future.  Congress passed Gramm-Leach-Bliley and it was signed by President Clinton at the twilight of his Administration.  By the end of the next Administration (G. W. Bush), only EIGHT years later. the United States was reeling from the worst banking and credit crisis it had seen since the dawn of the 20th century, and it was spreading throughout the world.  The FDIC began publishing lists of bank failures every Friday, conducting raids on banks it or the State controllers deemed in danger of failing, or already had, legally — and, for the first time in history, the FDIC, the Federal Depositors Insurance Corporation’s funds went NEGATIVE from insuring lost depositor money.

All of these took place within 25 years of the beginning of banking deregulation in the United States — AFTER an over 50-year golden era for banking in the United States where bank failure was almost unheard of, to the point where bank failures and bank runs were becoming regular weekly news events on Friday nights.

Even more disturbing, the largest four banking institutions in the United States, the four largest banks (Bank of America, Citigroup, JPMorganChase and Wells Fargo) are now THIRTY percent LARGER than they were in 2007!

How can the next banking crisis be softened, if not stopped?

– Reconstitute a Bretton Woods-like system for the American economy: peg it with something convertible to stabilize the possible future crash of the US Dollar.  This would, in general, lower the value of the dollar, however, the dollar would be safe from a crash, or other cataclysmic disaster brought on by a perceived lack of confidence in the American financial system, which is all that currently “holds up” the American economy and the value of the US Dollar.

– Reinstitute a Glass-Steagall Law.  Banks shouldn’t be allowed to gamble with depositor money.  When banks buy futures or invest in trusts or mutual funds with depositor money, it’s the same as taking it down to the Casino and betting on a three-of-a-kind.  In fact, I’d be willing to bet on a CASINO win, over futures and stocks, at the moment.

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Aug 15 2013

Gag Order includes your Defense?

Courtesy drivebyplanet.com

Courtesy drivebyplanet.com

Ladar Levison started the email service Lavabit ten years ago; taking a significant amount of his adult life building his business.  While it’s understandable some in the government could be concerned over the use of non-government interceptable communications (is that even a phrase?) being used by terrorists or other people bent on causing whatever, this fact isn’t what disturbs me.

What deeply disturbs me, is he was forced to close, then under a gag order of the United States Government, isn’t allowed to discuss it at all — not even with his LAWYER.

Has it come to such a point where the United States will use legal scare-tactics to not only shut down threatening interests, but even deny those people (when they, themselves, have done nothing wrong) the right to not only defend themselves against it, but silence them?

I get that Lavabit was seen as a threat by the US Government, I’m not denying that.  Stuff like that CAN a threat.  It’s that they went after the owner, who has business interests in keeping people’s private information PRIVATE, and they essentially scared him into silence to such a point, he can’t even legally consult his lawyer.

Deeply disturbing.

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Aug 2 2013

How Goldman Sachs is giving you the screw…

Nick Madden, VP/CPO, Novelis, Inc.

“The situation illustrates the perils of allowing industries to regulate themselves.”
— Nick Madden, Chief Procurement Officer, Novelis, Inc.

We all know about the 2007 Financial Crisis — and how it wiped out millions of jobs around the world, and we know where it began, the US Subprime and Unsecured Credit Markets.  Now that the crisis is over, many think that a lot of the rackets, many assume that tighter financial regulations are helping keep large financial institutions from screwing over the same people they boned over in writing and trading in extremely risky securities.

Wrong.

Goldman Sachs, since 2008, has been buying up MASSIVE amounts of one metal: aluminum, and storing them in warehouses everywhere, particularly in Detroit.  What are they doing with it?  Just sitting on it.

Why is this a bad thing?  Isn’t sitting on metal a good idea when it’s cheap?  Sure… always a good thing.  However, when you buy up so much of it, you’re affecting the world supply of it, not so much.  By reducing supply, you increase demand — and what happens when demand goes up and supply goes down?  Raise the cost.

In 2008, Goldman Sachs reported that they were storing 50,000 tons of Aluminum in warehouses and company owned property.  In 2010, that number increased to 850,000 tons.  At this time?  1.5 MILLION tons.   TONS.

Now, when companies want to buy aluminum domestically, as nations like China like to set prices at the state-level, companies will turn to domestic companies, like those owned by Goldman Sachs.  Because they control the aluminum, they can say “Sorry, we can’t get it to you that fast, we apologize,” when in actuality, they can delay delivery to drive up the price.  Indeed, subsidiary of Goldman, before purchasing, was able to supply aluminum to its end-users, was 6 weeks.  After the purchase and management rearrangement by Goldman, the wait is now sixteen MONTHS.

How much, you say?  What’s YOUR bottom line?

According to Cenk Uygur with The Young Turks, the price increase at this time, broken down per aluminum can of soda/pop, is one tenth of cent, per can — equivalent.  While that doesn’t sound like a lot of money to the end user, that makes a massive dent in the profits of the initial supplier, such as the Soda company, in this case, to buy and manufacture the soda cans.  At Goldman’s level, however,

With the average of US$90 million worth of aluminum cans (ALONE) used in the US, and tons and tons of aluminum used in house sidings, wheels in automobiles, automobile body, anything you can think of.  On average, that increase works out to be roughly US$2 per every 35 pounds of aluminum.  With the average automobile using 12 pounds of aluminum (The New York Times), that adds up to US$12 in additional cost — that didn’t come from anywhere other than artificially controlling the supply to demand — only by slowing down aluminum shipment… that it owns, and stores.

Bottom line, from the entire operation of aluminum storage and shipment control, Goldman Sachs’ cut of the operation: US$5 Billion over the last three years.  (Thanks again, to The New York Times for this figure.)

Madden’s quote at the beginning of this entry has a lot sharper a point on it now, doesn’t it?  What do you think?

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