Republican presidential candidate Ted Cruz snagged the endorsement of former Texas Sen. Phil Gramm and announced that Gramm will serve as a senior adviser to the campaign on economic issues.
Bryce Covert noted at ThinkProgress.org (3/22) that Gramm has a long history of railing against regulation, particularly in the financial industry, and legislation he helped pass through during his time in the Senate have been connected to the financial crisis.
Gramm was perhaps Congress’ biggest proponent of financial deregulation. As chairman of the Senate Banking Committee from 1995 to 2000, he advocated a number of measures that weakened the government’s oversight of the finance industry. He was an architect of a key measure bearing his name, the Gramm-Leach-Bliley Act, which repealed parts of the Glass-Steagall Act of 1933. Glass-Steagall enacted a firewall within banking companies between their vanilla commercial activities and the riskier activities of investment banking and insurance. After its passage, commercial banks catering to everyday clients and investment and securities firms consolidated, and their far larger size contributed to the problem of too big to fail firms during the crisis. Many also argue that bringing commercial and investment banking under one roof led to greater and greater risk taking, which eventually led to the financial crisis.
The act also created a big regulatory gap for large investment banks for a period of time by failing to give the SEC or another agency authority to regulate them. Instead, they could submit to voluntary oversight, but many simply opted not to.
Gramm’s wife, Wendy, chaired the Commodity Futures Trading Commission from 1988 to 1993, under President George H.W. Bush, Michael Hiltzig noted in the Los Angeles Times (3/21). Toward the end of her tenure, the agency exempted Enron’s energy-swap derivatives from regulation. According to the watchdog group Public Citizen, her husband was one of the leading recipients of Enron campaign contributions in Congress, having collected nearly $100,000 since 1989. Five weeks after leaving the CFTC, Public Citizen reported, she joined the board of Enron, which paid her between $915,000 and $1.85 mln in compensation from 1993 to 2001, when the company collapsed.
Gramm inserted a provision in the Commodity Futures Modernization Act in 2000 that exempted complex derivatives — such as credit-default swaps — from regulatory oversight by the CFTC. As the use of credit-default swaps grew in the lead-up to the crisis, banks weren’t required to create backstops in case they failed, and when they all came crashing down amid the housing bubble’s burst, it left financial institutions exposed. Credit-default swaps took down AIG, leading to its bailout. Hiltzig said Gramm’s efforts at freeing up trading in derivatives is “why he’s often identified as one of the godfathers of the 2008 financial crisis.”
But even as the global financial system began to unravel, Gramm made questionable comments about the impending recession. Acting as a presidential adviser to John McCain in July 2008, three months after the failure of investment bank Bear Stearns, Gramm called the impending crisis a “mental recession,” saying the economy was doing much better than the naysayers claimed. He also said the US had “become a nation of whiners” over the economy. He was asked to resign from McCain’s campaign shortly afterward.
After he left the Senate in 2003, Gramm joined UBS to become vice chairman of its investment banking division. He was there until 2012, coinciding with the time that the bank manipulated a key interest rate that enriched large banks at the expense of the public (for which it was later fined). He also helped build the bank’s public policy office in Washington, D.C.
Gramm has continued to fight against attempts to bring the industry back under regulatory oversight. He testified before Congress last year against the Dodd-Frank reform act, arguing the “regulatory burden has exploded” since its enactment, “its measures are “shackling economic growth” and “imperiling our freedom,” and compared some regulators to Soviet officers.
In announcing Gramm’s endorsement, Cruz took great care to point out that Gramm was a staunch opponent of Bill and Hillary Clintons’ efforts during the ’90s to pass health care reform. He was a leader of the Republican opposition to it, saying at the time it would only pass “over my cold, dead political body.” He’s since continued the theme, writing op-eds in opposition to the Affordable Care Act, saying it “has made many problems in health care worse.”
Gramm was also the mastermind behind a particularly punitive part of the 1996 welfare reform bill, which automatically and permanently banned those who commit a drug crime from both food stamps and welfare benefits unless their states opt out of the measure. For over a decade, the majority of Americans were subject to those bans, although they are now starting to be repealed in many places. The bans have been linked to recidivism, as people who are released from prison and then cut off from the safety net have fewer options for financial stability, and taking other desperate measures like simply going hungry.
McCONNELL: NO NEW SUPREME COURT JUSTICE WITHOUT NRA OK. Supreme Court justices are nominated by the president and appointed with the advice and consent of the National Rifle Association, according to Senate Majority Leader Mitch McConnell (R-KY).
McConnell offered this unusual view of the confirmation process during an interview with Fox News (3/20). In response to a question from host Chris Wallace, who asked if Senate Republicans would consider the nomination of Judge Merrick Garland to the Supreme Court after the election if Hillary Clinton prevails, McConnell responded that he “can’t imagine that a Republican majority in the United States Senate would want to confirm, in a lame duck session, a nominee opposed by the National Rifle Association [and] the National Federation of Independent Businesses.”
The Majority Leader’s statement is significant for several reasons, Ian Millhiser noted at ThinkProgress.org (3/20). “For one thing, it suggests that his previously stated position that “this vacancy should not be filled until we have a new President,” is a sham. Simply put, it’s unlikely that the NRA or the NFIB will change their position on a nominee just because Hillary Clinton is president and not Barack Obama.
“But it’s also worth examining exactly who McConnell would give a veto power over nominees. The NFIB, of course, was a plaintiff in NFIB v. Sebelius, the first Supreme Court case seeking to repeal the Affordable Care Act. That lawsuit called upon the justices to impose limits on federal power that even the late Justice Antonin Scalia refused to impose in previous cases (although it’s worth noting that Scalia abandoned his previous principled stance when given the opportunity to cast a vote against Obamacare). When the NFIB isn’t fighting to take health care away from millions of Americans, it fights equally hard against raising the minimum wage.”
McConnell isn’t simply delegating his duty to evaluate potential Supreme Court nominees to the NRA, Millhiser noted, “he’s deferring to the NRA despite the fact that the gun lobby group’s case against Garland is very thin. It consists of Garland’s single vote to rehear a case that one of his court’s most conservative members also voted to rehear, along with a decision to allow the FBI to continue to perform audits on the background check system after lawmakers sympathetic to the NRA tried and failed to shut those audits down.”
ALABAMA BLOCKS LOCAL CONTROL ON MINIMUM WAGE. In February, Birmingham, Ala., decided to give the city’s low-wage workers a raise. Local officials approved a minimum-wage increase, that would apply solely to Birmingham employers, to $10.10 an hour.
Just two days later, Steve Benen noted at MaddowBlog.com (3/22), Alabama’s Republican governor and GOP-led legislature decided to undo what Birmingham had done. The state passed a law, which applied retroactively, prohibiting cities from raising their own minimum wages, even if they want to. In all, 17 Republican-led states have approved measures to block local control over minimum wage.
Republicans also have moved to limited local authority in other areas, Benen noted. Bloomberg News reported (3/15) that after local officials in Tempe, Ariz., to create paid sick-leave for the city’s workers. The initiative is facing some fairly intense resistance from state officials in Phoenix. Arizona’s House passed a bill (3/1) specifying that cities aren’t allowed to require private employers to provide paid sick leave or vacation.
The state Senate has passed companion legislation that would cut state funds used to pay for services like police and firefighting, for cities that try to supersede state laws. “They actually decided to dissolve our study group because they were so chilled by the state threat,” said Lauren Kuby, a Tempe city council member.
The move to punish communities that try to approve their own progressive policies was initiated by Arizona Gov. Doug Ducey (R), who, after one year on the job, said he would change “the distribution of state-shared revenue,” cutting off communities who pursued employment laws he considers “ill-advised.”
Arizona Senate President Andy Biggs (R) told Bloomberg that arresting a municipality isn’t an option, but GOP state policymakers are nevertheless eager to “provide a deterrent effect.”
Benen concluded: “So, let this be a lesson to everyone: when officials in Washington tell states what to do, it’s an outrageous abuse and clear evidence of government overreach. When states tell cities what to do, it’s protecting conservative principles.”
BRUSSELS BOMBING JUST ONE IN SERIES. The triple bombing in Brussels (3/22) that claimed more than 30 lives as just the latest in a series of deadly terrorist attacks carried out around the world in March.
After a similar, multi-target attack in Paris last November which left more than 100 people dead in restaurants and concert halls, some began to ask why the media offered such focused coverage of France and not Lebanon, Beenish Ahmed noted at ThinkProgress.org (3/22). Just a day before havoc exploded onto Parisian streets, a double suicide attack had killed more than 40 people in a bustling part of Beirut, but that attack got limited coverage.
For many, the asymmetric coverage pointed to an “empathy gap.” Since such violence is more common in the Middle East than in Europe, the news out of Beirut didn’t rise above the white noise of war and conflict in the region, even though it’s seen relative calm for years.
In Turkey, a suicide bombing shook a popular shopping area in Istanbul on 3/19, and left four people dead. The attack was attributed to a member of ISIS. It was the second terrorist attack in Turkey in March. The week before, a car bomb exploded in the heart of the Turkish capital, killing 36. The attack was claimed by the Kurdistan Freedom Hawks, a terror group linked to the outlawed Kurdistan Workers’ Party.
In Peshawar, a restive city in northern Pakistan, a bomb killed 16 people and injured dozens more (3/17). The bomb destroyed a bus that carried government employees in front on a busy thoroughfare. No group claimed responsibility for the carnage.
In Nigeria, 24 people were killed and more than a dozen wounded when two female suicide bombers detonated explosives in a mosque in Maiduguri, Nigeria (3/16).
Such attacks have become increasingly common in northeastern Nigeria, which has long been terrorized by the Islamist militant group Boko Haram. As in this instance, the group appears to be using female suicide bombers more and more frequently, Ahmed noted.
Meanwhile, in the US, at least 225 people died in shootings in the week from 3/16 through 3/22, according to GunViolenceArchive.org. None of the deaths were attributed to Islamist terrorists.
COURT STRIKES DOWN PRISON GERRYMANDERING. A US district judge in Florida ruled (3/21) that prison gerrymandering in Florida’s Jefferson County unconstitutionally dilutes the voting power of its residents. By packing inmates who can’t vote into a district, but counting them when drawing electoral maps, District Judge Mark Walker of Tallahassee said, the county had violated the “one person, one vote” principle in the Constitution’s Fourteenth Amendment.
The American Civil Liberties Union’s attorney, Nancy Abudu, argued the case on behalf of Jefferson County residents who felt the prison gerrymandering watered down the strength of their political power by unfairly stacking the deck for residents who live in the same district as the non-voting prisoners.
According to the ACLU, of nearly 1,200 inmates in the correctional center, only nine were convicted in Jefferson County. Yet the inmates make up a whopping 43% of the voting age population in legislative District 3, giving other 57% of voters in the district inflated voting power. “It skews the numbers so dramatically in this instance,” Abudu told ThinkProgress.
Florida officials have also been accused of pushing a prison gerrymandering scheme on the federal level, and were caught by reporters this year discussing how such a tactic could be used to unseat African-American US Rep. Corrine Brown (D-FL). The maps, which are also being challenged in court, put 18 prisons in Brown’s district, driving up the population with inmates who can’t legally cast a ballot.
According to a Prison Policy Initiative report, four out of five US residents live in states that allow prison gerrymandering. In 2012, the US Supreme Court upheld Maryland’s “No Representation Without Population Act” which counts inmates as residents of their home addresses for redistricting purposes. Similar laws have passed in other states, including New York, Delaware, Virginia, Massachusetts, Illinois and California, and legislation has been introduced in Connecticut, Kentucky, New Jersey, Oregon, Rhode Island and Texas.
Florida has one of the strictest felon disenfranchisement laws in the country and more than one in five black adults in the state cannot vote. As the law stands now, anyone currently in prison, on probation or parole and those who have completed their sentences are barred from voting, which comes out to about 10% of the state’s population.
USE A RAIN BARREL, GO TO JAIL. In Colorado, where recreational marijuana was legalized two years ago and extreme weather has caused serious concerns, one mundane drought-fighting tool remains illegal: using rain barrels to catch rainwater from roofs for use in gardens.
Opposition to rain barrels is driven by an entrenched agriculture and water lobby, grounded in a strict interpretation of water law.
Colorado is one of many states that operate under a prior appropriation system whereby people with “senior” water rights get access before those with “junior” water rights. In a water-constrained world, they argue, there won’t be enough to go around. And senior water right holders are worried that urban farmers and lawn-lovers will impinge on their allocations by collecting rain off their roofs.
However, supporters of legalizing rain barrels argue that there is no net loss of water, so senior water rights remain unimpeded. Indeed, a study from Colorado State University noted that use of rain barrels would not decrease the amount of surface runoff going to downstream users, thereby negating the argument that opponents of rain barrel legalization have relied on. The study analyzed urban hydrology using Colorado-specific climatic conditions, and found that rain barrel use would not impact runoff, infiltration, or evaporation.
A bill to legalize rain barrels is making its way through the Colorado state legislature. It would allow homeowners to possess two 55-gallon rain barrels to collect and store rainwater for use in gardens and yards. The bill overwhelmingly passed the Colorado state House on a 61-3 vote, but faces an uncertain future in the Republican-controlled Senate.
Water advocates say that rain barrels are a good tool for water conservation, but perhaps more importantly, they encourage citizens to think about their water use and make conservation-minded decisions. As Pete Maysmith, Executive Director of Conservation Colorado, which is leading the fight to legalize rain barrels put it, “It makes water policy approachable, not something just for lawyers and insiders.”
CLIMATE SCIENTIST MAKES DIRE WARNING ABOUT SEA LEVEL RISE, SUPERSTORMS. If global temperatures on Earth continue to go up, ferocious super-storms could become more frequent and sea levels could rise several meters over the next century, drowning coastal cities along the way.
That’s the ominous warning put forth in a new, peer-reviewed paper penned by former top NASA scientist Dr. James Hansen and 18 co-authors, which was published in the journal Atmospheric Chemistry & Physics (3/22) and reported by Jacqueline Howard of HuffingtonPost.com.
The research suggests that current climate models — including forecasts made by the United Nation’s Intergovernmental Panel on Climate Change — underestimate the effects of ice melt runoff from the Greenland and Antarctic ice sheets. For instance, the IPCC previously warned of only 3 feet (about one meter) of sea level rise by 2100.
“Greenland and Antarctica are beginning to melt because of global warming,” Hansen, an adjunct professor in Columbia University’s Department of Earth and Environmental Sciences, says in a video about the paper. “So far it is just a tiny, tiny fraction of the ice sheets that has melted. However, this fresh meltwater spilling out onto the North Atlantic and into the Southern Ocean already is having important effects.”
The researchers found evidence indicating that increased temperatures of 2 degrees Celsius (3.6 degrees Fahrenheit) would yield multi-meter sea level rise and violent super-storms, fueled by a shutdown of ocean circulation. In other words, melting ice sheets could dump cool and dense water into the oceans that then would sink and affect circulation patterns. This shift in circulation patterns could cause the ice sheets to melt even more, leading to increased sea level rise at a faster rate than previously thought.
Last year, a separate team of scientists at the Potsdam Institute for Climate Impact Research in Germany found evidence suggesting that the overturning circulation of the Atlantic Ocean has been slowing and has been weaker than ever before in the last millennium. In a press conference on Monday, Hansen said that hurricane Sandy was an impact of such slowdown.
“It’s a complex story with important practical implications,” Hansen said. “What the science actually tells us is we need to reduce emissions as rapidly as practical.”
FLINT PROBE BLAMES WATER CRISIS ON STATE. An investigatory panel tasked by Michigan Gov. Rick Snyder (R) laid the blame for the contamination of Flint’s drinking water with lead and other toxins on the state in a final report released (3/23). “[T]he state is fundamentally accountable for what happened in Flint,” it states. “The Flint water crisis is a story of government failure, intransigence, unpreparedness, delay, inaction, and environmental injustice.”
The report enumerates a number of shortcomings among state agencies, particularly the Michigan Department of Environmental Quality (MDEQ), which it says bears “primary responsibility” for the water contamination and “failed in its fundamental responsibility to effectively enforce drinking water regulations.” The report finds that the MDEQ misinterpreted the federal lead and copper rule, meant to protect Americans from lead in drinking water, and misapplied its requirements, leading to underreporting and high exposure for residents that went on for months. It also waited too long before accepting intervention from the Environmental Protection Agency (EPA) while failing to investigate the situation on its own.
The report also points a finger at the state-appointed emergency managers who were appointed to run Flint by Snyder due to the city’s precarious financial situation. That system “remov[ed] the checks and balances and public accountability” that come with leadership from locally elected officials. The report also found, contrary to the claims of former emergency managers such as Darnell Earley, that emergency managers and not Flint’s local officials made the decision to switch Flint’s water from Detroit to the Flint River, which was a first step in the contamination crisis.
Given the combined failings of the MDEQ and emergency managers, both of which report to the governor, the report places primary accountability on state government, which means, “Ultimate accountability for Michigan executive branch decisions rests with the Governor.” Specifically, the report notes that concerns raised among his staff and their suggestion that the city switch back to Detroit water in October of 2014 should have at least resulted in a comprehensive review of the situation. “It was dismissed, however, because of cost considerations and repeated assurances that the water was safe,” the report notes, while also acknowledging that Snyder was relying on incorrect information provided by state agencies.
In a press release responding to the report, Snyder didn’t mention those findings. Instead, he said the state is already implementing many of the report’s recommendations, which include staffing and enforcement reforms at MDEQ, more frequent monitoring of children’s blood levels, better communication inside the governor’s office, more accountability for state departments, and a review of the emergency manager law. “We are taking dozens of actions to change how we operate – not just to hold ourselves accountable, but to completely change state government’s accountability to the people we serve,” he said. (Bryce Covert, ThinkProgress, 3/23)
PUBLIC INTEREST GROUPS URGE FCC TO BLOCK CHARTER-TIME WARNER MERGER. As FCC Chairman Tom Wheeler reportedly planned to circulate a draft order approving Charter’s bid to take over Time Warner Cable and Bright House Networks, 22 public interest organizations sent a letter urging the FCC to deny the $90 bln merger.
The Center for Media Justice, CREDO Action, Daily Kos, Demand Progress, Free Press and Presente.org were among the media justice, Internet rights and public interest groups calling on the FCC to reject this deal, which would create a national broadband duopoly.
Together, Charter and Comcast would control nearly two-thirds of the nation’s high-speed broadband subscribers and would offer service to nearly 80% of US households. The letter notes that this substantial increase in market power, coupled with Charter’s $66 bln in debt, would give the company both the incentive and the heightened ability to raise prices at will. This would broaden the digital divide, hitting low-income communities the hardest.
Earlier this year, several of the signers delivered petitions to the FCC from more than 300,000 Americans opposing the merger, and thousands have called the agency in recent days to weigh in against the deal. Political leaders including Senate Democratic Leader Harry Reid have spoken out about the merger’s many harms.
See the full letter at www.freepress.net.
TRUMP GOT $2B IN FREE MEDIA. Donald Trump received nearly $2 bln in free media exposure this past year, dwarfing his Republican rivals and more than doubling the attention paid to Democratic front-runner Hillary Clinton, according to tracking firm mediaQuant, Michael Calderone reported at HuffingtonPost.com (3/15).
Trump received $1.9 bln in free, or “earned,” media coverage, yet spent just $10 mln on paid advertisements this election cycle. While Texas Sen. Ted Cruz, Florida Sen. Marco Rubio and Ohio Gov. John Kasich each spent more money than Trump on ads, the Republican candidates clocked in at $313 mln, $204 mln and $38 mln in free media respectively.
Thanks to Trump’s ability to drive ratings and generate controversy, TV networks have covered the candidate nonstop since he entered the race last summer.
According to mediaQuant, the Republican front-runner has received far more free media coverage than Hillary Clinton, who got $746 mln, and Vermont Sen. Bernie Sanders, who got $321 mln.
OBAMA GIVES CUBA TASTE OF FREE PRESS. Among Obama’s accomplishments on his trip to Cuban, he maneuvered Cuban President Raúl Castro into answering questions from the American press in a news conference broadcast live to the island nation (3/21).
It started with CNN’s Jim Acosta, son of a Cuban emigre, asking Castro about Cuba’s political prisoners and whether he preferred Donald Trump or Hillary Clinton.
“Give me a list of the political prisoners and I will release them. Just mention names,” Castro, clearly flustered, said. “If we have those political prisoners, they will be released before the night ends.”
Obama looked on with a smile, Edward-Isaac Dovere noted at Politico.com (3/21). Then Castro remembered the second question and noted, “Well, I cannot vote in the United States.”
A reporter for Cuban state TV had a question for Obama but started with one for Castro about what steps he was taking toward improving the countries’ relationship. Castro started to answer, but stopped himself. “You are making too many questions to me,” he said. “I think questions should be directed to President Obama.”
So Obama answered the question from Cuban TV on whether the US would “give more space” to eliminate the US blockade, saying he had done much of what he could do without further action from Congress. “I’ve been very clear about the interests in getting that done before I leave. Frankly, Congress is not as productive as I would like during a presidential election year. But the fact that we have such a large congressional delegation with Democrats and Republicans with us is an indication that there is growing interest inside of Congress for lifting the embargo.”
Then Obama turned to NBC’s Andrea Mitchell. He quickly answered her question about the future of the embargo, which he said is “going to end. When, I can’t be entirely be sure. But I believe it will end, and the path that we’re on will continue after my time in office.” He talked about his faith in what would come from more person-to-person contact between Cubans and Americans.
Then he passed the question to Castro, who had been fiddling with papers the whole time, except for another long, theatrical drink of water.
“Now I’m done, but I think Señor Presidente, I think Andrea had a question for you,” Obama said.
He turned to Mitchell.
“He did say he was going to take one question, and I said I was going to take two,” Obama said, before pivoting to Castro. “She’s one of our most esteemed journalists in America. I’m sure she’d appreciate just a short answer.”
“I know that if you’ll stay here, you’ll make 500 questions. I said I was going to answer one, and I’m going to answer one and a half,” he said. He had his answer about her human rights question prepared: “I’m going to make the question to you now,” he said.
There are “61 instruments of human rights,” Castro said, quoting a number he seemed to have invented on his own, Politico noted.
“What country complies with them all? Do you know how many? I know. None. None whatsoever. Some countries comply some rights, others comply with others,” Castro said, by way of defense. “Of these 61 instruments, Cuba has complied with 47 issues.”
He turned the exchange into an opportunity to beat up on the US. In Cuba, they think universal health care is a human right, Castro said. Every child is born in a hospital, no matter where they’re from, or who their parents are, he added. They believe education for all is a human right, he said. And finally, in a point that got Obama senior adviser Valerie Jarrett nodding at communications director Jen Psaki, implying the Cuban leader had a point, Castro said he thinks equal pay for women is a human right, too.
Human rights issues, he said, “should not be politicized.”
“That is not fair, it’s not correct. I’m not saying it’s not honest, it’s part of confrontations of course,” Castro concluded.
Castro checked his watch. There’s a schedule to keep to, he said, though his scheduled time with Obama was until later in the evening, when they would attend a state dinner.
But he returned to the point that had gotten under his skin a few minutes earlier.
“It’s not correct to ask me about political prisoners in general,” he said.
Then he looked toward the exit.
“I think this is enough,” Castro said. “We have concluded. Thank you for your participation.”
From The Progressive Populist, April 15, 2016
Blog | Current Issue | Back Issues | Essays | Links
About the Progressive Populist | How to Subscribe | How to Contact Us
PO Box 819, Manchaca TX 78652