Later On

A blog written for those whose interests more or less match mine.

Archive for December 22nd, 2013

The NFL is a tax-exempt “non-profit” organization

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That was a surprise to me. I had no idea that pro football players were working for a non-profit. And I seem to recall that the NFL reaps enormous profits. Read this post at DailyKos and, if you think the NFL should be taxed as a for-profit enterprise, sign the petition.

Written by LeisureGuy

22 December 2013 at 10:55 am

Posted in Business, Government

Strong, harsh criticism of the Fed and its new mission: To prop up the stock market

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The Federal Reserve banking system just had its 100th birthday. In the Washington Post Neal Irwin has an interesting history of the Fed, adapted from his book The Alchemists: Three Central Bankers and a World on Fire. Pam Martens reports on the PBS program that discussed the new mission the Fed has undertaken:

PBS promised a “debate” this past Friday night on the “benefits and dangers” of the Federal Reserve as the Fed marks its 100 years of existence tomorrow. Instead of a debate, two famous stock market historians made the same stunning announcement – that the Fed has decided its job is to push up the stock market.

Consuela Mack’s Wealthtrackprogram on PBS had invited James Grant, Editor and Founder of Grant’s Interest Rate Observer, and Richard Sylla, the Henry Kaufman Professor of the History of Financial Institutions and Markets at NYU’s Stern School of Business. The opening scene for the program shows Sylla in a party hat lighting the candles on the Fed’s birthday cake while Grant snuffs them out – suggesting that Sylla would be making pro-Fed statements while Grant would take the opposing view.

What happened during the program, however, was that both men made the candid and bold accusation that the Federal Reserve, for the first time in its history, has assigned itself the job of propping up the stock market.

Grant had this to say: “New thing – it is in the business of talking up the stock market…The Fed is manipulating prices, especially on Wall Street.” To another question from Mack, Grant says: “The Fed has presided over the decay of finance.”

Professor Sylla adds more fuel to the fire, stating: “The Fed seems to have, I think almost deliberately, is trying to push the stock market up. I’ve watched this stuff for 40, 50 years now and this is the first time in my memory when it seemed to be official U.S. government policy that the stock market goes up. And the Fed likes this because it thinks that when the stock market goes up, people who own stocks feel richer, they’ll go out and spend more money, and the unemployment rate will come down.” You can watch the full program here.

Is it possible that the Federal Reserve, with its economic wizards and differential equations, doesn’t know that the more it props up the stock market and Wall Street, the more it is undermining Main Street and exacerbating wealth inequality in America?As brilliantly laid bare by producer Martin Smith on another PBS program on April 23 of this year, Wall Street has become an institutionalized wealth transfer mechanism, moving the savings of the little guy into the pockets of the very rich.

The program, The Retirement Gamble, showed how if you work for 50 years and receive the typical long-term return of 7 percent on your 401(k) plan and your fees are 2 percent, almost two-thirds of your account will go to Wall Street. Under a typical 2 percent 401(k) fee structure, almost two-thirds of your working life will go toward paying obscene compensation to Wall Street; a little over one-third will benefit your family – and that’s before paying taxes on withdrawals. The dirty secret is the negative impact that Wall Street fees subtract from compounded interest over long blocks of time.

In the program, Smith pulls up a compounding calculator on his laptop. On air, he shows the viewer the results:

Smith: “Take an account with a $100,000 balance and reduce it by 2 percent a year. At the end of 50 years, that 2 percent annual charge would subtract $63,000 from your account, a loss of 63 percent, leaving you with just a little over $36,000.”

You can prove the point to yourself. Pull up a compounding calculator on line.

Continue reading.

Written by LeisureGuy

22 December 2013 at 10:21 am

Posted in Business, Daily life

Covert action against FARC in Columbia

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The Washington Post has an extremely interesting and fairly detailed account by the redoubtable Dana Priest (who broke the story of the CIA’s gulag of secret prisons and torture chambers in various countries) of how the US, working through the CIA, NSA, and Special Forces, assisted the Colombian government in breaking the back of FARC. I would be that this story is part of an NSA/CIA public-relations campaign, trying to rehabilitate their somewhat tattered reputations. Note, for example, this sentence, which obviously comes from the CIA:

The CIA also trained Colombian interrogators to more effectively question thousands of FARC deserters, without the use of the “enhanced interrogation” techniques approved for use on al-Qaeda and later repudiated by Congress as abusive.

Butter wouldn’t melt in their mouths, eh? Unfortunately, the CIA’s prior enthusiastic embrace of torture and the CIA’s quite deliberate decision to destroy the video evidence of the torture sessions is not so easily settled.

But the article does show how the carefully considered and systematic use of intelligence and force can help end a disastrous rebellion.

Written by LeisureGuy

22 December 2013 at 10:07 am

Sen. Mark Udall: “Edward Snowden broke his oath”

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I’m astonished that a US Senator is so poorly informed. Edward Snowden worked for Booz Allen, and though he undoubtedly signed a nondisclosure agreement (a contract), he took no oath. The Senator seems confused. Here’s the link—and I do agree with the Senator’s comments that the NSA must be reined in. But I’m astonished at his ignorance about the oat.

Written by LeisureGuy

22 December 2013 at 9:36 am

Posted in Daily life

Juan Cole on how NSA bribed encryption companies

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Very good post at Informed Comment by Juan Cole:

Reuters gets the scoop: the National Security Agency gave internet security firm RSA some $10 million to use an NSA encryption formula in its BSafe software. RSA is now a subsidiary of the EMC corporation, and they have urged customers not to use BSafe since the revelations by Edward Snowden made clear that the NSA’s formula in fact allowed the agency access to all the information supposedly encrypted with it.

This story should be a huge scandal, but I fear it won’t be. This is like the FDA paying a pharmaceutical company to carry a drug that does not work and could therefore leave patients open to dying from an untreated illness after taking medication they are assured will cure it. If the NSA could exploit weaknesses in the encryption formula, so could hackers. The NSA subverted the will of millions of customers around the world who used RSA software precisely in a quest to be safe from the prying eyes of government officials and other peeping Toms.

Moreover, the $10 million has to be seen as a bribe (it was a third of that RSA’s income that year). Isn’t it illegal for government officials to bribe private companies? Isn’t it moreover illegal for intelligence officials to give out money like candy to a private company in order to spy on Americans on American soil?

I’d like to know what NSA official or officials were involved in this sting operation on the American people. I’d like to know if Barack Obama knew about it. I’d like to know if the corporate officials who accepted the “contract” with these strings attached knew they were screwing us all over.

This Reuters story makes sense of the allegation emerging from the Snowden leaks three months ago that the NSA had spent $250 million on keeping access to encrypted data by working with firms that provided encryption services. Presumably they have just been ensuring that no one’s encryption formula actually shields things from them.

Increasingly, firms and governments abroad would be crazy to buy encryption products from American companies. Likewise, getting cloud services from US corporations is a way to ensure that the US government can steal your trade secrets.

The NSA’s grasping ambition to abolish all human privacy has endangered $35 billion a year in business for US internet giants such as Apple, Google and Cisco Systems. Cisco’s China orders fell off by 18% after this summer’s revelations from the NSA documents. . .

Continue reading.

It’s becoming increasingly clear that the NSA is more interested in power than in fighting terrorism. Spying on the legal governments of allies and on legitimate oil businesses and on aid organizations is not about fighting terrorism.

Written by LeisureGuy

22 December 2013 at 9:02 am

Interesting: William F. Buckley Jr. on marijuana

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William F. Buckley, Jr. was about as conservative as one can get, and (naturally enough) he loathed the war on drugs, which gives unreasonable power to the Federal government to spend billions and billions of taxpayer dollars to wreck people’s lives for using a plant that is essentially harmless—and indeed, rightly used, therapeutic.

One quotation (and I unfortunately have no link):

Narcotics police are an enormous, corrupt international bureaucracy … and now fund a coterie of researchers who provide them with ‘scientific support’ … fanatics who distort the legitimate research of others. … The anti-marijuana campaign is a cancerous tissue of lies, undermining law enforcement, aggravating the drug problem, depriving the sick of needed help, and suckering well-intentioned conservatives and countless frightened parents.

Commentary in The National Review, April 29, 1983, p. 495

Another and more detailed blast against the war on drugs—and specifically the war on marijuana—from June 29, 2004, can be found here. It begins:

Conservatives pride themselves on resisting change, which is as it should be. But intelligent deference to tradition and stability can evolve into intellectual sloth and moral fanaticism, as when conservatives simply decline to look up from dogma because the effort to raise their heads and reconsider is too great. The laws aren’t exactly indefensible, because practically nothing is, and the thunderers who tell us to stay the course can always find one man or woman who, having taken marijuana, moved on to severe mental disorder. But that argument, to quote myself, is on the order of saying that every rapist began by masturbating. General rules based on individual victims are unwise. And although there is a perfectly respectable case against using marijuana, the penalties imposed on those who reject that case, or who give way to weakness of resolution, are very difficult to defend. If all our laws were paradigmatic, imagine what we would do to anyone caught lighting a cigarette, or drinking a beer. Or — exulting in life in the paradigm — committing adultery. Send them all to Guantanamo?

Legal practices should be informed by realities. These are enlightening, in the matter of marijuana. There are approximately 700,000 marijuana-related arrests made very year. Most of these — 87 percent — involve nothing more than mere possession of small amounts of marijuana. This exercise in scrupulosity costs us $10-15 billion per year in direct expenditures alone. Most transgressors caught using marijuana aren’t packed away to jail, but some are, and in Alabama, if you are convicted three times of marijuana possession, they’ll lock you up for 15 years to life. Professor Ethan Nadelmann, of the Drug Policy Alliance, writing in National Review, estimates at 100,000 the number of Americans currently behind bars for one or another marijuana offense.

What we face is the politician’s fear of endorsing any change in existing marijuana laws. You can imagine what a call for reform in those laws would do to an upward mobile political figure. Gary Johnson, governor of New Mexico, came out in favor of legalization — and went on to private life. George Shultz, former secretary of state, long ago called for legalization, but he was not running for office, and at his age, and with his distinctions, he is immune to slurred charges of indifference to the fate of children and humankind. But Kurt Schmoke, mayor of Baltimore, did it, and survived a reelection challenge.

But the stodgy inertia most politicians feel is up against a creeping reality. . .

Continue reading.

Continue reading.

Written by LeisureGuy

22 December 2013 at 8:57 am

Posted in Drug laws, GOP

In the US, the mentally ill get to keep their arsenals of firearms

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I somehow do not feel safer knowing this. Combine mental illness, firearm possession, and open-carry and I suspect you’re looking at the sort of thing that makes many say, “Who could have known?” Michael Luo and Mike McIntire write in the NY Times:

Last April, workers at Middlesex Hospital in Connecticut called the police to report that a psychiatric patient named Mark Russo had threatened to shoot his mother if officers tried to take the 18 rifles and shotguns he kept at her house. Mr. Russo, who was off his medication for paranoid schizophrenia, also talked about the recent elementary school massacre in Newtown and told a nurse that he “could take a chair and kill you or bash your head in between the eyes,” court records show.

The police seized the firearms, as well as seven high-capacity magazines, but Mr. Russo, 55, was eventually allowed to return to the trailer in Middletown where he lives alone. In an interview there recently, he denied that he had schizophrenia but said he was taking his medication now — though only “the smallest dose,” because he is forced to. His hospitalization, he explained, stemmed from a misunderstanding: Seeking a message from God on whether to dissociate himself from his family, he had stabbed a basketball and waited for it to reinflate itself. When it did, he told relatives they would not be seeing him again, prompting them to call the police.

As for his guns, Mr. Russo is scheduled to get them back in the spring, as mandated by Connecticut law.

“I don’t think they ever should have been taken out of my house,” he said. “I plan to get all my guns and ammo and knives back in April.”

Connecticut’s law giving the police broad leeway to seize and hold guns for up to a year is actually relatively strict. Most states simply adhere to the federal standard, banning gun possession only after someone is involuntarily committed to a psychiatric facility or designated as mentally ill or incompetent after a court proceeding or other formal legal process. Relatively few with mental health issues, even serious ones, reach this point.

As a result, the police often find themselves grappling with legal ambiguities when they encounter mentally unstable people with guns, unsure how far they can go in searching for and seizing firearms and then, in particular, how they should respond when the owners want them back.

“There is a big gap in the law,” said Jeffrey Furbee, the chief legal adviser to the Police Department in Columbus, Ohio. “There is no common-sense middle ground to protect the public.”

A vast majority of people with mental illnesses are not violent. But recent mass shootings — outside a Tucson supermarket in 2011, at a movie theater last year in Aurora, Colo., and at the Washington Navy Yard in September — have raised public awareness of the gray areas in the law. In each case, the gunman had been recognized as mentally disturbed but had never been barred from having firearms.

After the Newtown killings a year ago, state legislatures across the country debated measures that would have more strictly limited the gun rights of those with mental illness. But most of the bills failed amid resistance from both the gun lobby and mental health advocates concerned about unfairly stigmatizing people. In Washington, discussion of new mental health restrictions was conspicuously absent from the federal gun control debate.

What remains is the uncertain legal territory at the intersection of guns and mental illness. Examining it is difficult, because of privacy laws governing mental health and the limited availability of information on firearm ownership. But The New York Times obtained court and police records from more than 1,000 cases around the country in which guns were seized in mental-health-related episodes.

A systematic review of these cases — from cities and counties in California, Colorado, Connecticut, Florida, Indiana, Ohio and Tennessee — underscores how easy it is for people with serious mental health problems to have guns.

Over the past year in Connecticut, where The Times obtained some of the most extensive records of seizure cases, there were more than 180 instances of gun confiscations from people who appeared to pose a risk of “imminent personal injury to self or others.” Close to 40 percent of these cases involved serious mental illness.

Perhaps most striking, in many of the cases examined across the country, the authorities said they had no choice under the law but to return the guns after an initial seizure for safekeeping.

For example, in Hillsborough County, Fla., 31 of 34 people who sought to reclaim seized firearms last year were able to do so after a brief court hearing, according to a count by The Times.

Among them was . . .

Continue reading. Quite a few photos in the article.

This is a serious problem. I do not see the NRA contributing to finding a solution.

Written by LeisureGuy

22 December 2013 at 6:51 am

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