Saturday, September 29, 2012

Where did the mammoth US budget deficits come from?



Let's go back about a decade, when budget surpluses were predicted for the foreseeable future. Somehow, the math went terribly wrong, by trillions of dollars. Here's an accounting of what happened.

By Peter Grier - The Christian Science Monitor

What’s the cause of the federal government’s huge budget deficits? That’s a question that is harder to answer in the particular than you might think. The general problem is obvious: Uncle Sam has been spending more money than he takes in. The specific reasons as to why this state of affairs exists are a mix of human decisions, economic circumstance, and the cumulative effect of time.

Context is important here. So let’s start with 2001. That year, the Congressional Budget Office looked out over the decade to come and saw ahead nothing but blue skies and black ink. It predicted that between 2001 and 2011 the US would run budget surpluses totaling $5.6 trillion.
That didn’t happen. Instead, the US racked up $6.1 trillion in deficits over that period. CBO’s prediction was a whopping $11.7 trillion off the mark. How did things go so wrong?

CBO has gone back and studied that, as it happens. In a paper published earlier this year, the group’s economists tried to pull out and compare the reasons for the multitrillion swing.

One big problem was that CBO isn’t magical. Unblessed with the ability to predict the future, it didn’t accurately foresee the economic troubles of coming years, including the crash of the Great Recession. This meant that less tax money came in than anticipated. Overall, CBO says that about $3.3 trillion of its $11.7 prediction error can be attributed to “economic and technical changes” to projected revenues.

Then there were the tax cuts. President George W. Bush instigated most of these, but President Obama also pushed through Congress a payroll tax cut intended to pump money into a moribund economy. Tax cuts accounted for a further $2.8 trillion of the $11.7 trillion discrepancy. (Yes, the big kahuna here is Mr. Bush’s 2001 reduction in income-tax rates, which alone accounts for about $1.2 trillion in revenue foregone over the decade.)

Finally, there are the increases in outflows unpredicted by CBO. Between 2001 and 2011, increased discretionary spending amounted to about $3 trillion. This category includes defense spending related to the wars in Iraq and Afghanistan, homeland security upgrades in the US, spending on food stamps and other hard-times safety net programs, and other general budget categories that are supposed to be approved annually by Congress.

Mandatory spending – a category that includes the Medicare prescription-drug program approved under Bush, the TARP bank bailout, and Mr. Obama’s economic stimulus package – went up by about $1.4 trillion during the period in question. (This type of outflow is called “mandatory” not because we had to do it, but because it results from formulas established by Congress instead of appropriated dollar totals.)

Charles Blahous, a former economic official in the Bush White House who is currently a Hoover Institution research fellow, has rolled all these numbers together into a simple pie chart. His answer to the question “where did the $11.7 trillion go?” is this: 27 percent went away due to projection inaccuracy; 24 percent went to tax cuts; and 49 percent can be accounted for by various forms of increased spending.

Yes, yes, but who’s to blame? It’s election season, after all, and accusations as to which party is responsible for most of this damage are as thick on the ground as October leaves after a windstorm. Asked why the debt has increased during his four years in office during a “60 Minutes” interview last week, Mr. Obama pointed a finger at his predecessor:
“Over the last four years, the deficit has gone up, but 90 percent of that is as a consequence of two wars that weren’t paid for, as a consequence of tax cuts that weren’t paid for, a prescription-drug plan that was not paid for, and then the worst economic crisis since the Great Depression.”

That answer is not accurate. Obama appeared to be talking about numbers that reflect the cumulative debt since 2001, not just his term. According to a White House-produced chart on the national debt, if you take the 10-year period of 2001 to 2011, Bush policies accounted for 55 percent of that figure. Obama-initiated policies such as the stimulus accounted for 11 percent, while the recession took care of the rest.

(The White House chart puts the total debt at $12.7 trillion, not $11.7 trillion, as does the CBO. The White House uses different underlying economic assumptions.)

But even that chart is something of an apples-to-mangoes comparison. Bush was president for eight years, and Obama for three. This is where the passage of time comes in – Bush’s tax cuts in particular had more time to accumulate and thus appear as a bigger part of the overall picture than the later-arriving Obama stimulus package.

Washington Post fact checker Glenn Kessler has looked at this in depth, and made his attempt at adding up who is responsible for the $1.3 trillion 2011 deficit alone. His rough estimate is that economic factors accounted for about 46 percent of this single-year shortfall, while Obama policies accounted for 44 percent, and Bush-era policies for about 10 percent.
Splitting up deficit causes by administration may be politically interesting. It’s possible, though, that it’s effectively pointless, in that it doesn’t lead to a better understanding of the choices that will confront US policymakers in years to come.

A more useful way of looking at things could be to reslice deficit numbers into cyclical and structural figures. The cyclical deficit is caused by stuff that varies from year to year, like food stamp spending, which is driven by unemployment. The structural deficit is welded into the structure of the federal budget like steel beams. It reflects chronic problems that only worsen, such as the rising cost of health care.

According to CBO, about $367 billion of the $1.3 trillion 2011 deficit was caused by cyclical stuff. Some $928 billion was structural. This is the part we really need to worry about, according to such budget watchdog groups as the Concord Coalition.

The most important of these structural factors should come as no surprise. They are the aging of the baby boom population, which will drive up the number of people enrolled in Social Security and Medicare; and the continued increase in health-care costs, which makes Medicare, Medicaid, and other government health-care programs more expensive on a per-person basis.

Population aging accounts for 64 percent of the cost growth of Social Security, Medicare, and Medicaid through 2035, according to a Concord Coalition analysis published earlier this year. Thirty-six percent is due to rising health-care costs.

“Borrowing our way through this is not a viable option because the rising cost of Social Security, Medicare and Medicaid is not a temporary blip. It gets bigger with time. Incurring permanently rising debt would result in staggering interest costs and ultimately a total debt burden that would crush the economy,” concludes the Concord Coalition analysis.





Tuesday, June 26, 2012

The American Dream Is Now a Myth: Joseph Stiglitz



Once seen as the land of opportunity, the U.S. today is grappling with rising inequality and a political system that benefits the rich at the expense of others, resulting in lower growth and risking the death of the American dream, according to Nobel prize-winning economist Joseph Stiglitz.

"The U.S. worked hard to create the American dream of opportunity. But today, that dream is a myth," Stiglitz wrote in an opinion in the Financial Times on Tuesday.

Stiglitz said U.S. inequality is at the highest point in nearly a century and the gap between those with the median income and those at the top is growing.

"The U.S. used to think of itself as a middle-class country - but this is no longer true," he said. "Today, a child's life chances are more dependent on the income of his or her parents than in Europe, or any other of the advanced industrial countries for which there are data."

According to a Census Bureau report, U.S. household income inequality has grown by 18 percent since 1967, although this trend has slowed in recent years. Wealth disparity is also proving to be a hot topic during the 2012 election year, with Democrats arguing that Republican candidate Mitt Romney's wealth makes him out of touch with ordinary Americans.

According to Stiglitz, regulations, particularly those governing the financial sector are contributing to the disparities. "Financial regulations allow predatory lending and abusive credit-card practices that transfer money from the bottom to the top. So do bankruptcy laws that provide priority for derivatives," he said. Stiglitz argues that Americans were increasingly being made to think that higher income inequality was a byproduct of faster growth, but he says that's a false choice. The U.S. economy grew faster in the decades after the Second World War, when inequalities were lower, than it did after 1980, he said.

"Textbooks teach us that we can have a more egalitarian society only if we give up growth or efficiency," he said. "However, closer analysis shows that we are paying a high price for inequality: it contributes to social, economic and political instability, and to lower growth."

Western countries with the healthiest economies, such as those in Scandinavia, have the highest degree of equality, Stiglitz noted. To prevent the worsening disparities, Stiglitz argues that the U.S. should stop cutting public education and other programs that enhance opportunities for the middle class and the poor.

"President Barack Obama's support for these investments, as well as the "Buffett rule" that asks those at the top to pay at least as much in tax as a share of their income as those who are less fortunate, are moves in the right direction," he said. He criticized Republican proposals to extend the Bush-era tax cuts on capital gains. But a number of economists as well as Democrats have come out in recent months in support of extending the tax cuts. 

"The country will have to make a choice: if it continues as it has in recent decades, the lack of opportunity will mean a more divided society, marked by lower growth and higher social, political and economic instability," he said.

***

Obama prepping thousands of lawyers for election



OLYMPIA, Washington — President Barack Obama's campaign has recruited a legion of lawyers to be on standby for this year's election as legal disputes surrounding the voting process escalate.
Thousands of attorneys and support staffers have agreed to aid in the effort, providing a mass of legal support that appears to be unrivaled by Republicans or precedent. Obama's campaign says it is particularly concerned about the implementation of new voter ID laws across the country, the possibility of anti-fraud activists challenging legitimate voters and the handling of voter registrations in the most competitive states.
Republicans are building their own legal teams for the election. They say they're focused on preventing fraud — making sure people don't vote unless they're eligible — rather than turning away qualified voters.
Since the disputed 2000 presidential election, both parties have increasingly concentrated on building legal teams — including high-priced lawyers who are well-known in political circles — for the Election Day run-up. The Bush-Gore election demonstrated to both sides the importance of every vote and the fact that the rules for voting and counting might actually determine the outcome. The Florida count in 2000 was decided by just 537 votes and ultimately landed in the Supreme Court.
This year in that state alone, Obama and his Democratic allies are poised to have thousands of lawyers ready for the election and hope to have more than the 5,800 attorneys available four years ago. That figure was nearly twice the 3,200 lawyers the Democrats had at their disposal in 2004.
Romney has been organizing his own legal help for the election. Campaign attorney Ben Ginsberg did not provide numbers but said the campaign has been gratified by the "overwhelming number of attorneys who have volunteered to assist."
"We will have enough lawyers to handle all situations that arise," he said.
The GOP doesn't necessarily need to have a numerical counterweight to Obama's attorneys; the 2000 election showed that experienced, connected lawyers on either side can be effective in court.
Former White House counsel Robert Bauer, who is organizing the Obama campaign's legal deployment, said there is great concern this year because he believes GOP leaders around the county have pursued new laws to impede the right to vote.
"The Republican Party and their allies have mapped out their vote suppression campaign as a response to our success in 2008 with grass-roots organization and successful turnout," Bauer said. "This is their response to defeat: changing the rules of participation so that fewer participate."
Several states with Republican leaders have recently pursued changes that could make voting more difficult, including key states such as Florida and Ohio, despite objections from voting rights groups that believe that the laws could suppress votes from low-income and minority blocs.
Republicans dispute that the laws are political, pointing to cases of election fraud and arguing that measures like those requiring voters to show identification are simply common sense. Pennsylvania's Republican House majority leader, Mike Turzai, however, told GOP supporters over the weekend that the state's new ID law "is going to allow Governor Romney to win the state of Pennsylvania."
Independent from the Romney team, a conservative group is prepping an Election Day team of its own to combat possible fraud.
Catherine Engelbrecht, president and founder of True the Vote, said the organization hopes to train and mobilize up to one million volunteers this year, many of them to serve poll watchers. One of the group's main initiatives is to "aggressively pursue fraud reports."
"Being a poll watcher is an age-old tradition and we're fortunate that so many volunteers are ready and willing to take a day off, learn what they need to know and help out at the polls," Engelbrecht said. True the Vote already has thousands signed up to help and had 500 trained election workers monitoring the Wisconsin recall vote earlier this month.
"They serve as volunteer guardians of the republic, to ensure that procedures at the polls are in keeping with state law," she said.
It's one of the efforts that have Obama's team fretting. The Democrats fear that anti-fraud activity could get out of hand, with vigilante poll watchers targeting and intimidating voters who may not know their rights.
"We will have the strategy and the resources to address the threat and protect the voter," Bauer said.
The Obama-aligned attorneys, most of whom are not election experts by trade, undergo training and have materials to show them how to help at the polls on Election Day.
Charles Lichtman, who is helping advise the effort in Florida this year after leading it in the last two cycles, first created the Florida Democratic Lawyers Council after the 2000 election, vowing that there would never be a repeat of that disputed vote. He contends Democrat Al Gore would have won the presidency over Republican George W. Bush if a similar legal infrastructure had been in place then.
Lichtman's efforts have since been replicated for other states. He said that is vital to provide voter protection.
"My experience has been that, in every election, the other side has taken drastic measures to try to suppress the vote," Lichtman said. The volunteer organization has not been involved in the 2012 legal disputes so far, though they are monitoring the developments.
Four years ago, the teams of lawyers organized by Obama and Republican candidate John McCain in 2008 went largely unused since the election wasn't very close.
But this year may be different given all the changes to voting laws — and the closeness of the race in recent polling.
The states with the strictest ID laws require voters to show photo identification before casting ballots. If they don't have proper identification or fail to bring it, they can cast a provisional ballot but must later go to meet with state elections administrators to sort things out before the ballot is counted.
Voting groups see a variety of potential problems, such as how voters are informed of the rule changes, how poll workers handle voters who fail to bring IDs and whether voters are provided adequate notice of the steps they need to take after casting an absentee ballot.
About 30 states have some form of an ID law, with varying methods of implementation.
Legal challenges typically start coming in the weeks before the election, but "litigation has started coming sooner and more vociferously" this year, says Edward Foley, an elections law expert with Ohio State University. That includes lawsuits surrounding Florida's plan to purge ineligible voters from the rolls.
Foley said. "We're in an era of increased litigiousness over the voting process."
He said lawsuits after Election Day may occur only if votes in a battleground state are within the "margin of litigation." That would probably be a difference of just hundreds of votes, a result that would be rare.
***

Monday, June 25, 2012

Most Americans oppose health law but like provisions

by Patricia Zengerle
Reuters – June 24, 2012


WASHINGTON (Reuters) - Most Americans oppose President Barack Obama's healthcare reform even though they strongly support most of its provisions, a Reuters/Ipsos poll showed on Sunday, with the Supreme Court set to rule within days on whether the law should stand.

Fifty-six percent of people are against the healthcare overhaul and 44 percent favor it, according to the online poll conducted from Tuesday through Saturday.

The survey results suggest that Republicans are convincing voters to reject Obama's reform even when they like much of what is in it, such as allowing children to stay on their parents' insurance until age 26. Strong majorities favor most of what is in the law. A glaring exception to the popular provisions is the "individual mandate," which forces all U.S. residents to own health insurance. Sixty-one percent of Americans are against the mandate, the issue at the center of the Republicans' contention that the law is unconstitutional, while 39 percent favor it.

"That's really the thing that has come to define the (reform) and is the thing that could potentially allow the Supreme Court to dismantle it if they decide it's not constitutional," Ipsos pollster Chris Jackson said.

In good news for Republicans at November's congressional elections, 45 percent said they were more likely to vote for a member of Congress who campaigned on a platform of repealing the law, versus 26 percent who said it would make them less likely, the survey showed. The Supreme Court is expected to rule on the 2010 healthcare reform, Obama's signature domestic policy achievement, this week, possibly as early as Monday.

The political stakes are sky-high on an issue that has galvanized conservative opposition to the Democratic president, and how the court's decision is framed politically could influence the outcome of the November 6 general election.

Support for the provisions of the healthcare law was strong, with a full 82 percent of survey respondents, for example, favoring banning insurance companies from denying coverage to people with pre-existing conditions. Sixty-one percent are in favor of allowing children to stay on their parents' insurance until age 26 and 72 percent back requiring companies with more than 50 employees to provide insurance for their employees.

Americans are strongly divided along partisan lines. Among Republicans, 86 percent oppose and 14 percent favor the law and Democrats back it by a 3-to-1 margin, 75 percent to 25 percent, the Reuters/Ipsos poll showed. But in what could be a key indicator for the presidential contest, people who describe themselves as political independents oppose the law by 73 percent to 27 percent.

Opposition among independents has been growing. In a survey conducted in April, two weeks after the Supreme Court heard the case, 63 percent of them opposed the measure, and 37 percent favored it.

"Republicans have won the argument with independents and that's really been the reason that we see the majority of the public opposing it," Jackson said. Republicans have dominated the political message on healthcare with calls to "repeal and replace" the law, condemned by conservatives as a government intrusion into private industry and the lives of private citizens. It passed in March 2010 with no Republican support in Congress.

Mitt Romney, the likely Republican presidential nominee, has promised to repeal the law if he defeats Obama, although he has not offered a plan of his own. Obama, who says he modeled the measure on a healthcare plan Romney passed as governor of Massachusetts, has defended it.

Obama critics - some from within his own party - have also questioned the president for focusing on healthcare reform early in his term instead of doing everything he could to fix the struggling U.S. economy.

Democrats back the measure as an effort to improve the lives of Americans and essential to control spiraling costs that are undermining the country's overall economic health. Healthcare expenditures in the United States neared $2.6 trillion in 2010, over 10 times the $256 billion spent in 1980, according to the Kaiser Family Foundation.

A good portion of the opposition to the healthcare law is because Americans want more reform, not less of it. The poll found that a large number of Americans - including about one-third of Republicans and independents who disagree with the law - oppose it because it does not go far enough to fix healthcare.

Seventy-one percent of Republican opponents reject it overall, while 29 percent feel it does not go far enough, while independent opponents are divided 67 percent to 33 percent. Among Democratic opponents, 49 percent reject it overall, and 51 percent wish the measure went further.

"If you add the people that oppose it because they think it doesn't go far enough, you get a majority of Americans, so it doesn't mean that healthcare reform is dead," Jackson said.

There was party division in Americans' view of the individual mandate. Overall, 61 percent of Americans oppose requiring all U.S. residents to own health insurance. Among Republicans, the percentage rose to 81 percent, and it was 73 percent among independents. But a majority of Democrats - 59 percent - favor the individual mandate.

The survey of 1,043 Americans was conducted from June 19-23. The precision of the Reuters/Ipsos online polls is measured using a credibility interval. In this case, the poll has a credibility interval of plus or minus 3.5 percentage points.

***

Talk of drones patrolling US skies spawns anxiety


by Joan Lowy
Associated Press – June 19, 2012

WASHINGTON (AP) — The prospect that thousands of drones could be patrolling U.S. skies by the end of this decade is raising the specter of a Big Brother government that peers into backyards and bedrooms. The worries began mostly on the political margins, but there are signs that ordinary people are starting to fret that unmanned aircraft could soon be circling overhead.

Jeff Landry, a freshman Republican congressman from Louisiana's coastal bayou country, said constituents have stopped him while shopping at Walmart to talk about it.

"There is a distrust amongst the people who have come and discussed this issue with me about our government," Landry said. "It's raising an alarm with the American public."

Another GOP freshman, Rep. Austin Scott, said he first learned of the issue when someone shouted out a question about drones at a Republican Party meeting in his Georgia congressional district two months ago.

An American Civil Liberties Union lobbyist, Chris Calabrese, said that when he speaks to audiences about privacy issues generally, drones are what "everybody just perks up over."

"People are interested in the technology, they are interested in the implications and they worry about being under surveillance from the skies," he said.

The level of apprehension is especially high in the conservative blogosphere, where headlines blare "30,000 Armed Drones to be Used Against Americans" and "Government Drones Set to Spy on Farms in the United States."

When Virginia Gov. Bob McDonnell, a Republican, suggested during an interview on Washington radio station WTOP last month that drones be used by police domestically since they've done such a good job on foreign battlefields, the political backlash was swift. NetRightDaily complained: "This seems like something a fascist would do. ... McDonnell isn't pro-Big Government, he is pro-HUGE Government."

John Whitehead, president of the Rutherford Institute of Charlottesville, Va., which provides legal assistance in support of civil liberties and conservative causes, warned the governor, "America is not a battlefield, and the citizens of this nation are not insurgents in need of vanquishing."

There's concern as well among liberal civil liberties advocates that government and private-sector drones will be used to gather information on Americans without their knowledge. A lawsuit by the Electronic Frontier Foundation of San Francisco, whose motto is "defending your rights in the digital world," forced the Federal Aviation Administration earlier this year to disclose the names of dozens of public universities, police departments and other government agencies that have been awarded permission to fly drones in civilian airspace on an experimental basis. Giving drones greater access to U.S. skies moves the nation closer to "a surveillance society in which our every move is monitored, tracked, recorded and scrutinized by the authorities," the ACLU warned last December in a report.

The anxiety has spilled over into Congress, where a bipartisan group of lawmakers have been meeting to discuss legislation that would broadly address the civil-liberty issues raised by drones. A Landry provision in a defense spending bill would prohibit information gathered by military drones without a warrant from being used as evidence in court. A provision that Rep. Rush Holt, D-N.J., added to another bill would prohibit the Homeland Security Department from arming its drones, including ones used to patrol the border.
Scott and Sen. Rand Paul, R-Ky., have introduced identical bills to prohibit any government agency from using a drone to "gather evidence or other information pertaining to criminal conduct or conduct in violation of a regulation" without a warrant.

"I just don't like the concept of drones flying over barbecues in New York to see whether you have a Big Gulp in your backyard or whether you are separating out your recyclables according to the city mandates," Paul said in an interview, referring to a New York City ban on supersized soft drinks.

He acknowledged that is an "extreme example," but added: "They might just say we'd be safer from muggings if we had constant surveillance crisscrossing the street all the time. But then the question becomes, what about jaywalking? What about eating too many donuts? What about putting mayonnaise on your hamburger? Where does it stop?"

Calabrese, the ACLU lobbyist, called Paul's office as soon as he heard about the bill. "I told them we think they are starting from the right place," Calabrese said. "You should need some kind of basis before you use a drone to spy on someone."

In a Congress noted for its political polarization, legislation to check drone use has the potential to forge "a left-right consensus," he said. "It bothers us for a lot of the same reasons it bothers conservatives."

The backlash has drone makers concerned. The drone market is expected to nearly double over the next 10 years, from current worldwide expenditures of nearly $6 billion annually to more than $11 billion, with police departments accounting for a significant part of that growth.

"We go into this with every expectation that the laws governing public safety and personal privacy will not be administered any differently for (drones) than they are for any other law enforcement tool," said Dan Elwell, vice president of the Aerospace Industries Association. Discussion of the issue has been colored by exaggerated drone tales spread largely by conservative media and bloggers.

Scott said he was prompted to introduce his bill in part by news reports that the Environmental Protection Agency has been using drones to spy on cattle ranchers in Nebraska. The agency has indeed been searching for illegal dumping of waste into streams but is doing it the old-fashioned way, with piloted planes.

In another case, a forecast of 30,000 drones in U.S. skies by 2020 has been widely attributed to the FAA. But FAA spokeswoman Brie Sachse said the agency has no idea where the figure came from. It may be a mangled version of an aerospace industry forecast that there could be nearly 30,000 drones worldwide by 2018, with the United States accounting for half of them.

Fear that some drones may be armed has been fueled in part by a county sheriff's office in Texas that used a homeland security grant to buy a $300,000, 50-pound ShadowHawk helicopter drone for its SWAT team. The drone can be equipped with a 40mm grenade launcher and a 12-gauge shotgun. Randy McDaniel, chief deputy with the Montgomery County Sheriff's Office, told The Associated Press earlier this year his office had no plans to arm the drone, but he left open the possibility the agency may decide to adapt the drone to fire tear gas canisters and rubber bullets.

Earlier this year Congress, under pressure from the Defense Department and the drone manufacturers, ordered the FAA to give drones greater access to civilian airspace by 2015. Besides the military, the mandate applies to drones operated by the private sector and civilian government agencies, including federal, state and local law enforcement.

Reps. Ed Markey, D-Mass, and Joe Barton, R-Texas, co-chairs of a congressional privacy caucus, asked the FAA in April how it plans to protect privacy as it develops regulations for integrating drones into airspace now exclusively used by aircraft with human pilots. There's been no response so far, but Acting FAA Administrator Michael Huerta will probably be asked about it when he testifies at a Senate hearing Thursday.

Even if the FAA were to establish privacy rules, it's primarily a safety agency and wouldn't have the expertise or regulatory structure to enforce them, civil liberties advocates said. But no other government agency is addressing the issue, either, they said.

***

Monday, May 7, 2012

4 high-tech ways the federal government is spying on private citizens


By Fox Van Allen – Tecca
One of the running jokes in the 1980s was how the former Soviet Union spied on its private citizens. As comedian Yakov Smirnoff used to joke: "In Soviet Russia, TV watches you!" But here in America, we were all safe from the prying eyes of the government. Fast forward to 2012, when the U.S. government actually has the tools and capabilities to spy on all its citizens. These eyes go well beyond traffic light cameras. Right now, the government is tracking the movements of private citizens by GPS, reading private citizens' emails, and possibly even reading what you're saying on Facebook. It does so all in the name of law enforcement and Homeland Security, of course — but whether or not that makes you feel safer is up to you.

1. The NSA is building a massive data center in Utah to read every email you'll ever send.
Many of us are aware that little of what we say on social networks is really private. But you'd think your emails would be safe from prying eyes — especially those of your government. Not so, once the government completes work on a top-secret Utah data center reportedly built to spy on civilian communications. The $2 billion facility, slated to be complete by September 2013, is allegedly designed to be able to filter through yottabytes (10^24 bytes) of data. Put into perspective, that's greater than the estimated total of all human knowledge since the dawn of mankind. If leaked information about the complex is correct, nothing will be safe from the facility's reach, from cell phone communications to emails to what you just bought with your credit card. And encryption won't protect you — one of the facility's priorities is breaking even the most complex of codes. The good news (if there is any) is that the sheer volume of internet traffic and emails sent in a single day is far too much to be read by human eyes. Instead, the government will likely need to rely on complicated algorithms to assess each transmission and decide if they represent a security threat. So you're probably out of the government's earshot here... as long as you watch what you say.

2. The FBI maintains detailed files on numerous public, semi-public, and private figures.
Have you ever thought of taking a job with the government? If you value your privacy, think twice — the government runs incredibly extensive background searches on its high-profile applicants. What kind of information does the government want from its applicants? Well, when former Apple CEO Steve Jobs was under consideration for a job with George H.W. Bush's administration in 1991, the FBI compiled a massive file on him. Included in that file: the fact that Jobs had a 2.65 GPA, his history of marijuana and LSD usage, and his tendencies to "distort reality" and to "twist the truth" in order to achieve his goals. Of course, Jobs is far from the only figure with an FBI file. Other public personalities profiled by the FBI include John Lennon, Marilyn Monroe, Jimi Hendrix, and even Anna Nicole Smith. If you're curious about what goods the FBI has on you, you can always submit a request to view your own personal file. It is worth noting, of course, that the government doesn't profile everyone — just certain people of interest.

3. Homeland Security is reading your Tweets and Facebook status messages.
Unless you play around with your Twitter and Facebook privacy settings, just about anything you say is public. So it might not come as a surprise that the Department of Homeland Security is seeking contractors to build software and hardware capable of reading through what it calls "publicly available social media." Essentially, the government wants to read through your tweets and status messages to see if there's any information that might help in detecting threats. There are some ground rules to the project. The government won't pose as a Twitter follower and won't accept or send any Facebook friend requests. Still, even with those restrictions, there's a lot of information floating out there for the feds to read, even if most of it is nonsense about Justin Bieber.

4. Your ISP may soon be required to keep files on what sites you visit.
The idea sounds pretty far out there — a law that would require your internet service provider to keep constant tabs on you, along with detailed records of what websites you visited and when. But that's exactly what the Hawaii state legislature proposed this January with H.B. 2288 and companion bill S.B. 2530. The bill, sponsored by State Rep. John Mizuno (D), "requires internet service providers... keep consumer records for no less than two years." The bill then goes on to specify that these records must include "each subscriber's information and internet destination history information." Thankfully, the bills' sponsors withdrew the offending legislation from debate. But the reason wasn't just public outcry. Also a factor was the fact that the U.S. House of Representatives is considering a similar bill titled Protecting Children From Internet Pornographers Act. That bill, sponsored and written by Texas Republican Representative Lamar Smith, would mandate that commercial ISPs create logs of customers' names, bank information, and IP addresses. That information could later be used by attorneys seeking to prosecute in a criminal trial or even in civil cases and divorce trials.

Between private companies violating your privacy and now the government, is there any way to avoid prying eyes? Not really, unless you make significant changes in the way you use the web. So before you send that next tweet or post that next Facebook status message, think about whether or not you'd be okay with a complete stranger looking at it — because that's very well what may happen.

***

Wednesday, May 2, 2012

Quote of the Day

Be regular and orderly in your life, so that you may be violent and original in your work.

– Gustave Flaubert

***

Pelican: Post-Metal at It's Finest

Sunday, April 29, 2012

Jailed for $280: The Return of Debtors' Prisons

By Alain Sherter – CBS MoneyWatch

How did breast cancer survivor Lisa Lindsay end up behind bars? She didn't pay a medical bill – one the Herrin, Illinois, teaching assistant was told she didn't owe. "She got a $280 medical bill in error and was told she didn't have to pay it," The Associated Press reports. "But the bill was turned over to a collection agency, and eventually state troopers showed up at her home and took her to jail in handcuffs."

Although the U.S. abolished debtors' prisons in the 1830s, more than a third of U.S. states allow the police to haul people in who don't pay all manner of debts, from bills for health care services to credit card and auto loans. In parts of Illinois, debt collectors commonly use publicly funded courts, sheriff's deputies, and country jails to pressure people who owe even small amounts to pay up, according to the AP.

Under the law, debtors aren't arrested for nonpayment, but rather for failing to respond to court hearings, pay legal fines, or otherwise showing "contempt of court" in connection with a creditor lawsuit. That loophole has lawmakers in the Illinois House of Representatives concerned enough to pass a bill in March that would make it illegal to send residents of the state to jail if they can't pay a debt. The measure awaits action in the senate.

"Creditors have been manipulating the court system to extract money from the unemployed, veterans, even seniors who rely solely on their benefits to get by each month," Illinois Attorney General Lisa Madigan said last month in a statement voicing support for the legislation. "Too many people have been thrown in jail simply because they're too poor to pay their debts. We cannot allow these illegal abuses to continue."

Debt collectors typically avoid filing suit against debtors, a representative with the Illinois Collectors Association tells the AP. "A consumer that has been arrested or jailed can't pay a debt. We want to work with consumers to resolve issues," he said.

Yet Illinois isn't the only state where residents get locked up for owing money. A 2010 report by the American Civil Liberties Union that focused on only five states – Georgia, Louisiana, Michigan, Ohio, and Washington – found that people were being jailed at "increasingly alarming rates" over legal debts. Cases ranged from a woman who was arrested four separate times for failing to pay $251 in fines and court costs related to a fourth-degree misdemeanor conviction, to a mentally ill juvenile jailed by a judge over a previous conviction for stealing school supplies.

According to the ACLU: "The sad truth is that debtors' prisons are flourishing today, more than two decades after the Supreme Court prohibited imprisoning those who are too poor to pay their legal debts. In this era of shrinking budgets, state and local governments have turned aggressively to using the threat and reality of imprisonment to squeeze revenue out of the poorest defendants who appear in their courts."

Some states also apply "poverty penalties," including late fees, payment plan fees, and interest when people are unable to pay all their debts at once, according to a report by the New York University's Brennan Center for Justice. Alabama charges a 30 percent collection fee, for instance, while Florida allows private debt collectors to add a 40 percent surcharge on the original debt. Some Florida counties also use so-called collection courts, where debtors can be jailed but have no right to a public defender.

"Many states are imposing new and often onerous 'user fees' on individuals with criminal convictions," the authors of the Brennan Center report wrote. "Yet far from being easy money, these fees impose severe – and often hidden – costs on communities, taxpayers, and indigent people convicted of crimes. They create new paths to prison for those unable to pay their debts and make it harder to find employment and housing as well to meet child-support obligations."

Such practices, heightened in recent years by the effects of the recession, amount to criminalizing poverty, say critics in urging federal authorities to intervene. "More people are unemployed, more people are struggling financially, and more creditors are trying to get their debt paid," Madigan told the AP.

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Thursday, April 26, 2012

My personal John Edwards trial: how he fooled me, and what I learned

Walter Shapiro examines what we know about the character and personalities of the 2012 candidates. Shapiro, who is covering his ninth presidential campaign, is a special correspondent for the New Republic.


About three weeks after Sept. 11, 2001, my wife, Meryl Gordon, and I had an off-the-record dinner with John and Elizabeth Edwards at the Washington restaurant Olives. The dinner was at the blurry intersection of Washington life — ostensibly social (Meryl had bonded with Elizabeth after writing an Elle magazine profile of her husband in 2001) but at its core professional (I was a columnist for USA Today and Edwards had White House dreams). Everyone was in a shell-shocked daze after the terrorist attacks, but my only clear memory of that dinner was Edwards’ palpable dislike for John Kerry, an obvious rival for the 2004 Democratic presidential nomination.

That was the beginning of a political-journalistic courtship that now makes me cringe. With Edwards on trial in North Carolina on charges of violating federal campaign-finance laws — after the disgrace of being caught with a mistress and denying being the father of her baby — I wish I had befriended a comparatively more honorable political figure like Eliot Spitzer or Mark Sanford. 

Back during those early, seemingly innocent days, there were a few more four-person dinners and an afternoon visit or two to the house that Edwards rented in Washington. As a reporter, I followed Edwards on one of his first forays into New Hampshire in mid-2002. I can still see Edwards, with Elizabeth at his side, sitting in a hotel bar in Portsmouth at the end of that long campaign day, glassy-eyed from the adulation, too pumped up with the adrenaline rush of politics for ordinary conversation. Those fledgling moments in New Hampshire chronicling the ambitious first-term North Carolina senator helped inspire me to write a book on the 2004 Democratic race in which Edwards (and, of course, Elizabeth) played central roles. 

In hindsight, I feel like the jaded city slicker, bristling with self-confidence that he can never be fooled, who ends up hoodwinked by the smiling rural Southern confidence man. Please understand: I did not deliberately put a thumb on the scale when I wrote about Edwards. It was more that I was convinced by Edwards’ sincerity when he talked passionately about poverty and the Two Americas. And I especially believed (because I spent so much time with Elizabeth) the romantic myth of the Edwards marriage. 

Many Edwards insiders from the 2004 campaign say the vice presidential nomination (bestowed by, yes, John Kerry) changed him. The entourage, the plane, the Secret Service detail and the frenzy of a fall campaign all supposedly fueled Edwards’ self-importance and sense of entitlement. But as I struggle to understand my own entanglement with a scandal-scarred presidential contender, I wonder if this arbitrary division between pre-veep Edwards and post-veep Edwards is too glib. 

The danger signs and character flaws were always there, and I failed to notice them. I was certainly not alone in my blindness. David Axelrod, for example, was Edwards’ first media consultant during the 2004 primary campaign. Even after Axelrod drifted away to concentrate on a long-shot Senate race for a candidate named Barack Obama in Illinois, he returned for Edwards’ last stand in the Wisconsin primary. I recall running into Axelrod in the Pfister Hotel in Milwaukee on primary day and hearing him say of Edwards, “He’ll be president someday.”

The elixir of power can cloud the vision of campaign aides and political reporters alike. When the stakes are as high as the presidency, the wish to believe often becomes irresistible. In Edwards’ case, it was all too easy to go from listening to his boast that he was “the son of a mill worker” and his passionate delivery of a staff-written speech about the disadvantaged to convincing yourself that the North Carolina senator was going to be the greatest anti-poverty warrior since Bobby Kennedy. After too many years of dealing with the reverberations from the “Clinton marriage” (how I hated typing those words), it was so refreshing to see the seemingly solid unit of John and Elizabeth Edwards (who laughingly referred to herself as the “un-Barbie”). 

Aside from Edwards, the presidential contender in recent years whom I thought I knew the best was John McCain. I was there for his marathon rolling press conferences on his campaign bus during the 2000 primaries. Over the years, I had maybe a dozen private breakfasts and lunches with him in the Senate Dining Room. This was not intimacy, but it was a different vision than merely seeing a candidate reading a speech from a teleprompter at a rally. 

And guess what? From the moment that McCain picked Sarah Palin as his running mate until long after the 2008 election, I did not recognize a single thing about the Arizona senator whom I thought I knew well. All those hours of talking — just the two of us — in the Senate Dining Room led to only fleeting bits of insight about McCain. As with Edwards, my certainty that my theories about McCain were true prevented me from seeing the abundant contrary evidence. 

So what lessons for the 2012 campaign have I derived from my embarrassing prior failures of political perception? (By the way, I am hoping to interest Hollywood in a major feature film — is George Clooney available? — about all the political stories that I have gotten right over the years.)

Perhaps the biggest truth is that anyone who reaches the upper ranks of American politics is a user, capable of feigning intimacy when what the candidate really wants is a large check or an endorsement or a flattering profile. That may be especially true of Barack Obama and Mitt Romney — both self-contained men whose few real friendships seemingly predate their involvement in big-time politics. What that means for political reporters and voters is that relatively few people know either Obama or Romney well — and even fewer are privy to what they are really thinking. 

Barack and Michelle Obama — along with Mitt and Ann Romney — have always advertised their marriages as a kind of political endorsement. In a sense, both men benefit from the common voter feeling, “If she loves him and has raised a family with him, then that’s good enough for me.” But without in any way casting aspersions on either the Obama or the Romney marriages, it is worth remembering how hard it is for any outsider to understand the essence of any marriage. Whether it was John and Elizabeth Edwards, Bill and Hillary Clinton, John and Jackie Kennedy or Franklin and Eleanor Roosevelt, political history has been filled with marriages that were, in reality, far different than the gauzy imagery of the campaign trail. 

In the end, what covering nine presidential campaigns has taught me is perpetual skepticism. With John Edwards, I learned it the hard way. The campaigns, the political true believers, the nearly $1 billion ad budgets and the TV spokesmen are all trying to sell voters on a product. But presidential candidates — regardless of party or ideology—are always flawed vessels for the hopes of their supporters. They are human beings (more ego-driven than most) with their own secrets and private insecurities.

Probing beneath the public masks of presidential candidates can be a frustrating exercise. But it remains our only defense against charlatans in the Oval Office. My Edwards and McCain miscalculations were, in part, inspirations for this series of columns — for the idea of looking at presidential candidates solely from the perspective of what will matter in 2013 after the winner places his left hand on the Bible and swears “to preserve, protect and defend the Constitution.” Character matters more than position papers in choosing a president. And if you look carefully enough and respect the complexity of the evidence, it is best glimpsed from the middle distance.

That is John Edwards’ lasting legacy to me. Never again will I get so close to the blinding sun of potential political power, and never again will I believe that I hold the full truth about anyone seeking the presidency.

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