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A Democratic Firm Is Shaking Up the World of Political Fundraising.

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The report I blogged in the previous post is probably a response in part to this innovation, reported in the Intercept by Rachel Cohen:

WHEN KARA EASTMAN pulled off a primary upset this past spring in Nebraska’s 2nd Congressional District, a swing seat in the Omaha metro region, she did so with no help from the national Democratic party. Eastman, a social worker and first-time candidate running on an unapologetic left-wing platform, was competing against former Rep. Brad Ashford, who served for years in the Nebraska legislature and one term in Congress between 2014 and 2016.

Despite Ashford’s long track record of supporting abortion restrictions, pro-choice groups like EMILY’s List, Planned Parenthood, and NARAL Pro-Choice America opted to stay out of the race. The Democratic Congressional Campaign Committee, or DCCC, elevated Ashford to their “Red to Blue” list, a signal of official party support for competitive races, and political action committees controlled by House leader Nancy Pelosi, D-Calif., and Rep. Steny Hoyer, D-Md., kicked in over $28,000 to Ashford’s bid.

Eastman, who embraced not only reproductive freedom but also policies like “Medicare for All,” tuition-free college, a $15 minimum wage, and increased gun control, struggled early on to compete. While her proposals and personal story were popular, finding donors was hard.

Yet by the time her primary rolled around, Eastman emerged the winner, raising close to $400,000  and benefitting from a flurry of late-stage media coverage. Using a new digital fundraising company to target customized groups of donors across the country — such as all Democrats who identify as social workers or those who back “Medicare for All” — Eastman’s team was able to change the trajectory of the race.

Her campaign credits Grassroots Analytics, an obscure tech startup that’s quietly shaking up the Democratic campaign finance world. Not a single article has ever been written about or even mentioned it, despite the company having aided some of the biggest upsets of the 2018 cycle, including Joe Cunningham in South Carolina, Lucy McBath in Georgia, and Kendra Horn in Oklahoma.

“Grassroots Analytics absolutely was what allowed us to be competitive in the primary and get on TV, otherwise there is no way we would have won,” said Dave Pantos, the finance director for Eastman’s campaign. “We were definitely not the mainstream candidate, and we didn’t have access to donor lists that more establishment candidates have.” Eastman ended up losing the general election, earning 49 percent of the vote, but has already announced that she’s jumping back in the fray for 2020.

Grassroots Analytics says it wants to level the playing field and to make it easier for candidates to run who don’t already have a built-in network of wealthy family, friends, and co-workers. Using an algorithm to clean and sort publicly available data spread across the internet, the company provides campaigns with customized lists of donors who they believe are most likely to support them. If you’re involved in the world of political fundraising, a thought has probably occurred to you just now: Wait, isn’t that illegal? Hold that thought.

Establishment groups like the Democratic National Committee, the DCCC, and EMILY’s List have largely given the firm the cold shoulder, despite its goals and the fact that it worked with 137 campaigns in the last cycle. Not even mainstream progressive organizations like Our Revolution or Justice Democrats would return Grassroots Analytics’s entreaties to work together.

DANNY HOGENKAMP, THE 24-year-old founder and director of Grassroots Analytics, wasn’t expecting to end up in this kind of business. He had no background in politics; he studied Arabic at the University of North Carolina at Chapel Hill and assumed he’d end up doing foreign policy or refugee resettlement work after college.

But after graduating in 2016, with no job yet to speak of, he decided to go crash with some relatives in Syracuse, New York, where he was born, and try his hand in a congressional campaign. He enlisted with first-time candidate Colleen Deacon, a 39-year-old single mother who had worked as Sen. Kirsten Gillibrand’s regional aide in upstate New York. Deacon, who previously lived on Medicaid and food stamps, campaigned on putting herself through college with minimum wage jobs and student loans.

Hogenkamp was placed on the finance team, where he was charged with raising money and managing a team of 20 unpaid interns. It was there that he first encountered the opaque world of political fundraising — a world that even many organizers, pundits, and journalists can hardly grasp.

“I had no idea what campaigns were like, and it turns out that literally what candidates actually do to raise money, unless you’re really well-connected and famous, is sit in a room and call rich, old people to beg for $1,500, $2,000, or preferably [the federal maximum] of $2,700,” he said.

To run a competitive House race, Deacon’s campaign knew it needed to raise between $1.5 million and $2 million. Syracuse is one of the poorer metropolitan areas in New York, and after the campaign exhausted all the local prospective donors it could think of, the next step was the big open secret in political campaigning: finding similar candidates in other states and races and then researching who donated to their campaigns. So, for example, Deacon staffers would search for similar candidates — like Monica Vernon, who was running for Congress at the same time in Iowa — and then try and track down the contact information for the donors listed on their Federal Election Commission reports.

“Our interns would literally just Google people and try to find their phone numbers,” Hogenkamp said. “But donors change their numbers all the time, and they’re hard to find.”

The whole thing was invariably slow and disorganized. “It was the stupidest process,” he said. “It’s not digitized; there’s no math; it’s just random and stupid.”

Hogenkamp, still pretty much an idealistic novice, was convinced that there had to be a better way, some obvious step he was missing. So, from his perch as a relatively high-level finance staffer on Deacon’s team, he reached out to everyone he could think of — like the DCCC, EMILY’s List, liberal consulting firms, and other politicians — to find out how to make this fundraising process easier. “No one had any good answers; they said, ‘Well, this is just how you do it,’” he said. Hogenkamp recalled Gillibrand’s team telling him about its personal wealthy contacts in New York and how fundraising for the campaign meant going to those people and asking each of them to go out and find 10 more donors within their own networks.

Eventually, Hogenkamp connected with David Chase, a Democratic political operative who was then managing the campaign for Rubén Kihuen in Nevada’s 4th Congressional District. Chase offered a bit of help: He had developed a very rudimentary tool to aid his team’s fundraising efforts.

“Using OpenSecrets, I built some product that allowed you to search through all the federal and state contributions,” Chase told The Intercept. “It was very simple — I don’t have any advanced technological skills — but I wrote a script that allowed you to upload a list and it spit back the stats on the amount of times someone had given to state races and their average contributions.” In other words, for someone looking to discover who had given $500 or so to multiple candidates, Chase’s tool provided a way to more quickly glean that information.

Chase explained his tool, and Hogenkamp realized that there was a lot more he could do with an idea like that. During college, he had interned at the Consumer Financial Protection Bureau, where he learned to model how likely students were to default on their student loans. “I just randomly had a background in R and Python and zero-inflated negative binomial regressions from my time at the CFPB, so it was really just serendipitous that I actually knew what to do,” he said. Following that conversation, Hogenkamp went back and recruited a bunch of Syracuse University computer science students to help him build out his vision.

The result was effectively what he calls a “cleaner” of publicly available data, scraped from across the internet, that analyzes and sorts information for more than 14.5 million Democratic donors over the last 15 years. The tool would generate lists of individuals most likely to support a candidate given shared characteristics and shared views — ranging from race and ethnicity to a passion for yoga or universal health care. . .

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Written by LeisureGuy

23 March 2019 at 10:46 am

House Democratic Leadership Shows Its Authoritarian Side

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Akela Lacy reports in the Intercept:

THE DEMOCRATIC CONGRESSIONAL Campaign Committee warned political strategists and vendors Thursday night that if they support candidates mounting primary challenges against incumbent House Democrats, the party will cut them off from business.

The news was officially announced Friday morning, paired with a statement on the committee’s commitment to diversity in consulting — “which, obviously, is just to give themselves cover,” a Democratic political consultant who learned of it Thursday told The Intercept. The consultant asked for anonymity given their relationship with the DCCC, and the party organization’s professed strategy of blacklisting firms that don’t fall in line.

To apply to become a preferred vendor in the 2020 cycle, firms must agree to a set of standards that includes agreeing not to work with anyone challenging an incumbent.

“I understand the above statement that the DCCC will not conduct business with, nor recommend to any of its targeted campaigns, any consultant that works with an opponent of a sitting Member of the House Democratic Caucus,” the form reads.

It’s no secret that the DCCC and national party leaders often interfere on behalf of preferred candidates. Or that they otherwise jump into the game too late, if they don’t completely write off newcomers who don’t meet their standards. The DCCC is known for prioritizing candidates and direct them to its own consultants, most of whom are alumni of the DCCC, which is known in Washington as a “consultant factory.” The latest move only reaffirms that reputation and sends a warning shot to grassroots and progressive consultants.

Groups working to diversify Congress say the committee has been slow to adequately address lack of representation — i.e., recruiting more womenand people of color. Collective PAC, which works to elect black Democrats, sent a letter to the DCCC last year asking why the group didn’t include any black candidates in its “Red to Blue” program, which targets seats that have a promising chance to flip. They added several candidates after that, including current Reps. Lauren Underwood of Illinois and Colin Allred of Texas.

D-trip claims its top priority is protecting the majority, and that in order to do so, they must keep internal discord at a minimum. But as progressive candidates, organizers, and members build grassroots campaigns and prove they can hold their own, the D-trip’s old playbook is having the opposite effect.

The strategy isn’t new. Though it did bring a few more hiccups in 2018 than expected, which makes the rollout all the more puzzling. “There was never an enforcement that I’ve ever seen,” the strategist told The Intercept. “This is the first time that they are ever making it open policy.”

After their coordinated attack on Laura Moser in Texas’s 7th District, she raised $86,000, got an endorsement from Our Revolution, and made it to a runoff. She eventually lost to current Rep. Lizzie Fletcher. But the episode gave fodder to progressive groups like the Working Families Party, Justice Democrats, and Collective PAC, which had formed for precisely that occasion — the party’s increasing inability to make space for new voices, many of them progressive. D-trip proved their point, and Our Revolution and WFP stepped in instead.

And in Nebraska’s 2nd District, the DCCC backed former Rep. Brad Ashford over Kara Eastman, who ended up winning the primary and losing the general election. Ashford was a former Republican who flip-floppedon access to abortion throughout his time in the state legislature and later as a Democrat in the U.S. House, and opposed single-payer health care. Eastman was a staunchly pro-choice progressive who supported Medicare for All. She was one of only two insurgents to beat DCCC-backed candidates last cycle. In the Democratic primary for Kentucky’s 6th District, Amy McGrath beat Jim Gray and later lost to Republican Rep. Andy Barr. Senate Minority Leader Chuck Schumer is now recruiting her to run against Majority Leader Mitch McConnell in 2020.

Strategists and congressional staffers with knowledge of the change say it will disproportionately impact vendors and candidates who are women and people of color, as the consultants who work with incumbents are the ones who’ve come up through the party at a time when its commitment to diversity was even dimmer than it is today.

The committee is telling firms they can’t oppose sitting members, the strategist said. “I’d rather keep the majority too, which is why to me this is kind of stupid to have a blanket rule. Because, if it’s a safe incumbent seat, why does it matter?”

The DCCC’s move also creates a new niche business, paradoxically, opening the door for consultants who don’t want to be under the thumb of the party. “From here on out, let’s refer to the DCCC for what it is, the White Male Centrist Campaign Protection Committee,” said Sean McElwee of Data for Progress. “My email is seanadrianmc@gmail.com. Any challenger looking for firms to work with them can feel free to reach out. There are plenty.”

Rebecca Katz, a longtime Democratic consultant, also said she’d be happy to work with the challengers. “The people who can’t understand the party is stronger because we have Alexandria Ocasio-Cortez and Ayanna Pressley in Congress should not be in the business of choosing who can run for Congress,” she said.

Alex Rojas, the head of Justice Democrats, the bane of the DCCC, is backing a primary challenge to incumbent Henry Cuellar in Texas, while looking for other candidates across the country. “Make no mistake — they are sending a signal that they are more afraid of Ayanna Pressley and Alexandria Ocasio-Cortez winning primary challenges than Henry Cuellar who votes with Trump nearly 70 percent of the time,” she said.

For both parties, . . .

Continue reading.

I find this repulsive.

Written by LeisureGuy

23 March 2019 at 10:41 am

Trump Nominates Famous Idiot Stephen Moore to Federal Reserve Board

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Jonathan Chait writes in New York:

Stephen Moore’s career as an economic analyst has been a decades-long continuous procession of error and hackery. It is not despite but precisely because of these errors that Moore now finds himself in the astonishing position of having been offered a position on the Federal Reserve board by President Trump.

Moore’s primary area of pseudo-expertise — he is not an economist — is fiscal policy. He is a dedicated advocate of supply-side economics, relentlessly promoting his fanatical hatred of redistribution and belief that lower taxes for the rich can and will unleash wondrous prosperity. Like nearly all supply-siders, he has clung to this dogma in the face of repeated, spectacular failures.

I first started writing about Moore in 1997. Four years before, President Clinton had raised the top tax rate to 39.6 percent, and supply-siders had insisted this would without question cause tax revenues to drop. This prediction was a necessary corollary of supply-side economic theory, which holds that tax revenue moves in the opposite direction of the top tax rate. The prediction was spectacularly wrong — revenue not only rose, it rose much, much faster than even the most optimistic advocates of Clinton’s plan had predicted.

Most supply-siders simply ignored this fact altogether. Moore, somewhat unusually, attempted to defend the original failed prognostication. His effort was hilariously buffoonish, using a series of errors that would embarrass a high-school economics student, such as failing to correct for inflation, and combining payroll tax data with income tax data.

In the years since, I have continued following his career, and he has shown no intellectual growth at all. He is capable of writing entire columns that contain no true facts at all. He made so many factual errors he achieved the rare feat of being banned from the pages of a Midwestern newspaper. He has sold his policy elixir to state governments which have promptly experienced massive fiscal crises as a direct result of listening to him. He believes what he calls “the heroes of the economy: the entrepreneur, the risk-taker, the one who innovates and creates the things we want to buy” should be lionized, and that the idea that a recession might be caused by anything other than excessively high rates on these heroes defies “common sense.” He was pulled into Trump’s orbit during the 2016 campaign and co-wrote a ludicrous hagiography of Trump and his agenda. By all appearances, Moore opposes mainstream fiscal theories because he simply doesn’t understand them.

And yet, for all their extravagant ignorance, Moore’s beliefs on fiscal policy are actually more sophisticated and well-developed than his views on monetary policy. It is the latter that he would be in a position to influence as a Federal Reserve governor.

Moore’s beliefs on monetary policy — it might be more accurate to describe them as “impulses” — tend to default to partisanship. During the Obama presidency, he warned that runaway government spending would produce hyperinflation. In 2009, he appeared on Glenn Beck’s program to wax hysteric. “We’ve seen this happened to Mexico, Bolivia, Argentina, Zimbabwe, Russia, all consumed by government, all do-gooders — some of that led to the decline of their civilizations,” he said, describing the scenario in lurid detail:

BECK: So, do we have hyperinflation with this scenario?

MOORE: Could be. I mean, that’s happened — in some countries, hyperinflation gets so bad, Glenn, that people have to go to the shopping stores literally with wheelbarrows full of their currency. In some countries, that people don’t even use the currency. In other countries, they print the currency but they don’t put the denomination on it because they write it down on the piece of paper.

BECK: Okay.

MOORE: And the currency becomes as valueless as the paper that it is printed on.

MOORE: And why do people buy gold?

(CROSSTALK)

MOORE: Because they don’t think money is worth anything anymore.

GERALD CELENTE: Not worth the paper it’s printed.

MOORE: Right. They don’t think it’s worth anything.

In 2010, Moore was still predicting hyperinflation and urging his audience to buy gold. Even by 2015, Moore was still urging the Federal Reserve to raise interest rates. “We’ve had seven years of zero interest rates and the lousiest recovery in 75 years,” he said, “So that’s one reason a lot of us feel like it’s time to get off the zero interest rate policy.”

There was no evidence for this position at all. Had Moore’s advice been followed, it would have led to a quick end to the recovery and a deep recession. It did, however, dovetail with the Republican Party’s political imperative of encouraging contractionary fiscal and monetary policy, in order to slow down or strangle the recovery.

Since Donald Trump moved into the White House, the Republican Party has reversed its views on both fiscal and monetary policy. Whereas it had previously deemed deficits and inflation a mortal threat, and called stimulus and lower interest rates counterproductive, the party line now demands both.

Moore has naturally ridden along with this reversal, but what has set him apart is the fervency with which he has embraced the volte-face. He has insisted on television that the economy is experiencing deflation, and when corrected by panelist Catherine Rampell on this unambiguous error of fact, refused to give ground. He has called for firing the Federal Reserve chairman as well as firing the entire Federal Reserve board.

Mooore’s current ultra-dovish stance is hardly anywhere near as ridiculous as his previous ultra-hawkish stance. The problem is that . . .

Continue reading.

Written by LeisureGuy

22 March 2019 at 3:40 pm

Capt. Sullenberger on the FAA and Boeing: ‘Our credibility as leaders in aviation is being damaged’

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Capt. ‘Sully’ Sullenberger writes at MarketWatch.com:

For most of the history of powered flight, the United States has been a world leader in aviation.

This nation’s aviation regulatory body, the Federal Aviation Administration (FAA), has long been the gold standard of safety regulation in global aviation, often a template for other nations to follow in technical and safety matters.

Boeing BA, -1.75% has long been the world’s preeminent airplane maker.

But now, our credibility as leaders in aviation is being damaged. Boeing and the FAA have been found wanting in this ugly saga that began years ago but has come home to roost with two terrible fatal crashes, with no survivors, in less than five months, on a new airplane type, the Boeing 737 Max 8, something that is unprecedented in modern aviation history.

For too many years, the FAA has not been provided budgets sufficient to ensure appropriate oversight of a rapidly growing global aviation industry. Staffing has not been adequate for FAA employees to oversee much of the critically important work of validating and approving aircraft certification. Instead, much of the work has been outsourced by designating aircraft manufacturer employees to do the work on behalf of the FAA. This, of course, has created inherent conflicts of interest, when employees working for the company whose products must be certified to meet safety standards are the ones doing much of the work of certifying them. There simply are not nearly enough FAA employees to do this important work in-house.

To make matters worse, there is too cozy a relationship between the industry and the regulators. And in too many cases, FAA employees who rightly called for stricter compliance with safety standards and more rigorous design choices have been overruled by FAA management, often under corporate or political pressure.Let me be clear, without effective leadership and support from political leaders in the administration, the FAA does not have sufficient independence to be able to do its job, which is to keep air travelers and crews safe. Oversight must mean accountability, or it means nothing.

Boeing, in developing the 737 Max 8, obviously felt intense competitive pressure to get the new aircraft to market as quickly as possible. When flight testing revealed an issue with meeting the certification standards, they developed a fix, Maneuvering Characteristics Augmentation System (MCAS), but did not tell airline pilots about it. In mitigating one risk, they seem to have created another, greater risk.

After the crash of Lion Air 610 last October, it was apparent that this new risk needed to be effectively addressed. It has been reported that Boeing pushed back in discussions with the FAA about the extent of changes that would be required, and after the second crash, of Ethiopian 302, the Boeing CEO reached out to the U.S. President to try to keep the 737 Max 8 from being grounded in the U.S. The new fix still has not been fielded, nearly five months after Lion Air. It almost certainly could have been done sooner, and should have been.

Boeing  has focused on trying to protect its product and defend its stance, but the best way, indeed the only way, to really protect one’s brand or product is to protect the people who use it. We must not forget that the basis of business, what makes business possible, is trust.

Estimates are that Boeing likely will face additional costs of several billion dollars because of these recent crashes and the decisions made several years ago that led up to them. This case is a validation of something that I have long understood, that there is a strong business case for quality and safety, that it is always better and cheaper to do it right instead of doing it wrong and trying to repair the damage after the fact, and when lives are lost, there is no way to repair the damage. . .

Continue reading.

The credits note:

Capt. “Sully” Sullenberger is a safety expert, author and speaker on leadership and culture. He is also a retired airline pilot who, on Jan. 15, 2009, safely landed US Airways Flight 1549 on the Hudson River in New York when both engines lost power after they were struck by a flock of birds. All 155 people on board survived.

Written by LeisureGuy

22 March 2019 at 10:09 am

“But I’m not a lawyer. I’m an agent.”

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David Simon, a former reporter on the Baltimore Sun and the creative force behind the series “The Wire,” writes on his blog:

Just over a quarter century ago, when I was a young scribbler traipsing around the metro desk of the Baltimore Sun, I had an early opportunity to learn a lesson about money, about ethics, about capitalism and, in particular, about the American entertainment industry. And Dorothy Simon, she raised no fools. I only needed to learn it once.

I learned about something called “packaging.”

And now, finally, my apostasy from newspapering having delivered me from Baltimore realities to film-set make-believe, I am suprised and delighted that many of the fellow scribblers with whom I share a labor union have at last acquired the same hard, ugly lesson:

Packaging is a lie. It is theft. It is fraud. In the hands of the right U.S. Attorney, it might even be prima facie evidence of decades of racketeering. It’s that fucking ugly.

For those of you not in the film and television world, there is no shame in tuning out right now because at its core, the argument over packaging now ongoing between film and television writers and their agents is effectively an argument over an embarrassment of riches. The American entertainment industry is seemingly recession-proof and television writing, specifically, is such a growth industry nowadays that even good and great novelists must be ordered back to their prose manuscripts by book editors for whom the term “showrunner” has become an affront. A lot of people are making good money writing television drama. And so, this fresh argument is about who is making more of that money, and above all, where the greatest benefits accrue.  If you have no skin in the game, I think it reasonable, even prudent, to deliver a no-fucks-to-give exhale and proceed elsewhere.

If, on the other hand, you are my brother or sister in the Writers Guild of America — East or West, it matters not when we stand in solitarity — or conversely, if you are a grasping, fuckfailing greedhead with the Association of Talent Agents, then you might wanna hang around for this:

Here is the story of how as a novice to this industry, I was grifted by my agents and how I learned everything I ever needed to know about packaging.  And here is why I am a solid yes-vote on anything my union puts before me that attacks the incredible ethical affront of this paradigm. Packaging is a racket. It’s corrupt. It is without any basis in either integrity or honor. This little narrative will make that clear. And because I still have a reportorial soul and a journalistic God resides in the details, I will name a name wherever I can.

*           *           *

To begin, I wrote a book. It was a non-fiction account of a year I spent with a shift of homicide detectives in Baltimore, a city ripe with violence and miscalculation. Published in 1991, “Homicide: A Year on the Killing Streets” was repped by my literary agent at the time, an independent attorney who I found because his other clients included some other ink-stained newspaper reporters. Late in 1987, the Baltimore Police Department agreed to let me into its homicide unit for a year beginning that January, so I needed to quickly acquire an agent to sell the project to a publishing house and secure an advance on which to live while I took a leave-of-absence from my newspaper. This agent — and damn, I wish I could name the goniff, but I later signed a cash settlement that said I wouldn’t — was the first name that came to me. I did not shop around; I was in a hurry.  My bad.

Three years later, with the book ready to publish, this shyster suggested to me that he was entirely capable of going to Hollywood with it for a sale of the dramatic rights. And knowing less than a bag of taters about Hollywood, I was ready to agree until my book editor, the worthy John Sterling, then helming the Houghton Mifflin publishing house, told me in no uncertain terms that this was a mistake.

It was customary, John explained, for even the best literary agents to pair with a colleague at one of the bigger entertainment agencies and split the commission.  My literary agent would give up half of his 15 percent to the other agency, but he would gain the expertise of an organization with the connections to move the property around and find the right eyeballs in the film and television industry. So I called my agent back and insisted.

With some initial reluctance, he eventually chose to go with Creative Artists Agency — one of the Big Four, as they call the largest entertainment entities repping talent, and an agent in CAA’s literary division by the name of Matt Snyder.  After making the deal with CAA, my literary agent called me back and said it was customary for me to give up a larger percentage commission as I now had two agents working on my behalf.  How much more? He suggested that he should keep his 15 percent and I should pay CAA an additional 10 percent. So a quarter of the profits from the sale of book would now be siphoned to agency commissions.

I called back John Sterling and asked:  Is this right?

John nearly dropped the phone. No, that is not how it works. Again, he explained that my literary agent was supposed to split the existing 15 percent commission on the book with CAA. The literary agent was supposed to keep 7.5 percent and give the other half to CAA, which in no way was entitled to any cash above and beyond that split.

I called my agent back. No, you split the existing 15 points, I told him. He threw a few chunks of pouty guilt at me, but I shrugged him off. This first attempt at a grift should have warned me, but hey, I was young.

Advance the story a couple months later:

CAA has sent the book to about a dozen A-list film directors, where it lays in their offices like a stale bagel, unloved and unsold. No one can figure out how to transform a year in the professional lives of a half dozen Baltimore death investigators into a feature film. Matt Snyder is bereft of a next idea. He does have one small-option offer from a small indy company. I get on the phone with a producer there and ask for his credits and it’s pretty clear, even to me, that it’s short money for a project that probably goes nowhere.

I call Snyder back.

Hey, I wonder aloud, how about Barry Levinson? He’s from Baltimore. He makes movies. Maybe he’ll like it. Did I mention he’s from Baltimore? Have you seen DinerTin Men?  I sure do love me some Diner. . .

Continue reading.

Written by LeisureGuy

20 March 2019 at 7:30 am

This is the problem with tax cuts leading to reduced government resources: Lax oversight

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“A software system on the Boeing jets that crashed is now under scrutiny. But in the F.A.A.’s initial review process, it went largely unnoticed.” That’s the email headline for this report by David Gelles and Thomas Kaplan:

As regulators at the Federal Aviation Administration reviewed designs for Boeing’s newest passenger jet, they paid extra attention to several features, including the lithium ion batteries, the pressure fueling system and the inflatable safety slides.

One feature that did not receive exceptional scrutiny: a new software system intended to prevent stalls.

That same software is suspected of playing a role in two deadly crashes involving the same jet, the Boeing 737 Max. Authorities around the world are now taking a closer look at the jet’s approval by the F.A.A., a process that relies heavily on Boeing employees to certify the safety of the plane.

The 737 Max was one of the first commercial jets approved under new rules, which delegated more authority to Boeing than had been the case when most previous planes were certified. And the software system did not raise warnings during the approval process. Top F.A.A. officials, who are briefed on significant safety issues, were not aware of the software system, according to two people with knowledge of the process.

The United States transportation secretary, Elaine L. Chao, on Tuesday called for her agency’s internal watchdog to open an inquiry into the process, saying that “safety is the top priority of the department.” Lawmakers in the United States are similarly pushing for a review, while Canada is looking into its approval of the plane’s American certification.

The scrutiny adds to the pressure at Boeing, an aerospace giant with a strong safety record. The 737 Max, its best-selling jet, has more than 4,600 pending orders, which are expected to bring in hundreds of billions of dollars in the coming years.

The plane is now grounded as the company races to come up with a fix to the software. It is unclear when the jet will start flying again.

A spokesman for Boeing said the manufacturer would cooperate with the audit by the Department of Transportation. It has defended the certification process for the jet, saying that “the 737 Max was certified in accordance with the identical F.A.A. requirements and processes that have governed certification of all previous new airplanes and derivatives.”

The F.A.A.’s response to the crisis has also come under scrutiny. As authorities in other countries moved quickly to ban the plane following the crash in Ethiopia this month, the American regulator held off.

The F.A.A. has been run by an acting administrator, Daniel K. Elwell, since January 2018. President Trump on Tuesday picked a former Delta Air Lines executive, Stephen Dickson, to become the permanent head of the agency.

Before a new plane can fly, the F.A.A., in partnership with manufacturers, assesses the technology, design and components that make up the jet. They look for potential safety issues that could affect the airworthiness of the plane.

The investigations into the crashes are ongoing, but the similarities between the two doomed flights suggest potential problems with the new software system, known as MCAS. In the case of the Lion Air crash in October, the automated system may have engaged based on erroneous data, creating a struggle for the pilots who were trying to maintain control.

But the software — powerful as it was — did not emerge as a major focus for the F.A.A. regulators who certified the Max as safe to fly in 2017, according to the people involved in the effort who were not authorized to speak publicly about the process.

The software did not set off what is known as a special condition, usually applied to a novel feature that requires additional regulations before it can be certified as safe. The plane’s non-rechargeable lithium batteries, for example, fell into that category.

To Boeing and regulators, the MCAS software was not a technological breakthrough. Rather, it was viewed as part of the existing flight control software, according to the one of the people.

The system was intended as a safety feature to make the 737 Max,which boasted other significant design features, fly like earlier models.

The new, more efficient engines on the 737 Max were larger and placed in a different location than previous generations. To compensate for the new aerodynamics, Boeing installed the software, which would force the nose of the plane down in certain circumstances. The goal was to help avoid a stall.

The F.A.A., in its approval of the plane, did not require training on the software, a sign that regulators did not see the system as critical for pilots to understand. Nor did the F.A.A. require pilots who could fly the predecessor 737 to train on a simulator in order to fly the Max. Most pilots did not know about MCAS until after the Lion Air crash.

The regulators also approved the software to be triggered after receiving data from only one so-called angle-of-attack sensor. The decision allowed for the system to have a single point of failure, a rarity in aviation safety.

Most important safety systems include redundancy. The coming software fix by Boeing will require data from both of the plane’s angle-of-attack sensors, among other changes, according to pilots and lawmakers. . .

Continue reading.

Written by LeisureGuy

19 March 2019 at 5:38 pm

Posted in Business, Government

How PG&E Ignored California Fire Risks in Favor of Profits

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The opening graphic of this report is stunning, and the report itself shows the Achilles’ heel of capitalism: that the structure of the capitalistic endeavor works to focus a company’s attention and efforts totally on increasing profits, and any measures that take away from profits must be curtailed—including, for example, spending any money at all to make the workplace safer (cf. coal mines). That’s why the government and its agencies must closely monitor and regulate private corporations—for example, by having Congress pass the Occupational Safety and Health Act, and then by having the Executive branch see that companies act in accordance with the Act. And that effort must be stead and vigorous because companies are driven to increase profits and are willing to do anything to achieve that goal, including (as we have repeatedly see, in example after example) things that are immoral, unethical, and illegal. It helps that such crimes rarely lead to any company personnel being imprisoned. The typical punishment is a fine, and surprisingly often the fine is small compared to the profits realized. And the pressure to increase profits is always there. Naturally, then, companies start to view fines as a cost of doing business, and if the net effect is that profits increased, so what?

The tragedy of the wildfires caused by PG&E’s deliberate decisions not to do maintenance is a good example. Maintenance is expensive, and if the company discontinues it, profits will increase.

Ivan Penn, Peter Eavis, and James Glanz report for the NY Times:

Tower 27/222 looms almost 100 feet tall in the Sierra Nevada foothills, a hunk of steel that has endured through 18 United States presidents. The transmission lines that it supports keep electricity flowing to much of California.

On the morning of Nov. 8, a live wire broke free of its grip. A power failure occurred on the line, affecting a single customer. But 15 minutes later, a fire was observed nearby. Within hours, flames engulfed the region, ultimately killing 85 and destroying the town of Paradise.

The equipment belonged to the state’s biggest utility, Pacific Gas and Electric. To the company’s critics, the tower and its vulnerability reflect a broken safety culture.

Five of the 10 most destructive fires in California since 2015 have been linked to PG&E’s electrical network. Regulators have found that in many fires, PG&E violated state law or could have done more to make its equipment safer.

Long before the failure suspected in the Paradise fire, a company email had noted that some of PG&E’s structures in the area, known for fierce winds, were at risk of collapse. It reported corrosion of one tower so severe that it endangered crews trying to repair the tower. The company’s own guidelines put Tower 27/222 a quarter-century beyond its useful life — but the tower remained.

In January, the company sought bankruptcy protection, saying it might face more than $30 billion in wildfire liabilities. Its financial straits could hamper its preparations for the next wildfire season, and those beyond, even as weather patterns increase the fire risk.

“There is a climate change component to this,” said Michael W. Wara, director of the climate and energy policy program at Stanford University and a member of a state commission examining the cost of wildfires. “But there’s also a failure of management and a failure of vision.”

Another major utility in the state, San Diego Gas & Electric, has added hundreds of weather stations, cameras and satellite technology in recent years to reduce fire risk. PG&E is now trying to catch up.

Beyond wildfires, PG&E has a broader history of safety problems. A 2010 explosion of a PG&E gas pipeline killed eight people and destroyed a suburban neighborhood, prompting state and federal officials to investigate PG&E’s safety practices. Regulators ultimately fined the utility $1.6 billion, and a federal jury convicted it of violating a pipeline safety law and obstructing an investigation. The company is still under court-supervised probation.

PG&E executives acknowledge that the company has made mistakes. “We have heard the calls for change and are committed to taking action by focusing our resources on reducing risk and improving safety throughout our system,” John Simon, PG&E’s interim chief executive, said in a recent statement.

But Gov. Gavin Newsom said the company’s record made it hard to take its promises seriously.

“They have simply been caught red-handed over and over again, lying, manipulating or misleading the public,” Mr. Newsom said in an interview. “They cannot be trusted.” . . .

Continue reading. There is much more.

Speaking of companies that absolutely cannot be trusted, I offer Facebook as a prime example. How many times more will Mark Zuckerberg apologize and promise to do better? Answer: As many times as needed. He’s not going to change, and Facebook is not going to change. Government intervention is required.

I do understand that government can also go bad, with regulatory agencies in effect taken over by the industries that they are supposed to regulate—just look at the Trump administration, or how the Obama administration refused to take any serious action to regulate Wall Street. (The Obama administration did create the Consumer Finance Protection Bureau—actually, Elizabeth Warren created it—but now that agency is defunct: Trump allowed the payroll lending industry to destroy it.)

Obviously, the government itself must be watched carefully, and that is the job of the free press and investigative journalism—like this report.

Later in the article:

. . . “Some people believe that you run equipment to failure,” Catherine Sandoval, a former California regulator who has been pushing for improved maintenance of electrical poles and towers. “They believe ‘run to failure’ to save money. This is the danger of run to failure.”

In December 2012, five other aging towers on the same stretch, the Caribou-Palermo line, collapsed in a storm. In July 2013, Brian Cherry, PG&E’s vice president for regulatory affairs at the time, notified state regulators that the company would replace the five fallen towers and one more, but not 27/222.

A 2014 company email that has come to light in the bankruptcy proceedings said that “the likelihood of failed structures happening is high.” But PG&E determined that if the structures failed, the cause would probably be heavy rain, precluding a wildfire risk. PG&E said this week that the structures in question were temporary wooden poles that had since been replaced.

In April 2016, PG&E made another request to regulators: to install fresh wires on the Caribou-Palermo line. But the company said it would not replace any of the line’s remaining nearly century-old towers.

That October, during painting work on a lattice tower on the line, a piece of hardware called a J hook broke when a contract worker grabbed it while repositioning himself. A PG&E report said workers had determined that corrosion — the reason for the painting — was enough of a problem that “crews working on these towers need to use caution.”

The company said that tower had a different design from Tower 27/222’s. But it would not comment on why it didn’t replace 27/222 given its age. It said it considered many factors when making decisions on maintenance and repairs. . .

It makes my blood boil. The executives who made these cost-cutting decisions should face very long prison terms. Here’s why:

. . . The deadly 2010 gas pipeline explosion in San Bruno, a San Francisco suburb, was PG&E’s second in a two-year period. The ensuing investigations and litigation produced an alarming picture of the company’s practices and priorities.

In court depositions, employees said supervisors routinely ignored their concerns about the company’s use of faulty analysis and outdated equipment. The state’s Public Utilities Commission, which regulates PG&E, concluded that the company was more concerned with profit than with safety.

The commission’s safety and enforcement division found in 2012 that PG&E’s gas and transmission revenues exceeded what it was authorized to collect by $224 million in the decade leading up to the explosion. But capital spending fell $93 million short of its authorized budget between 1997 and 2000. PG&E also spent millions less on operations and maintenance than it was supposed to.

“There was very much a focus on the bottom line over everything: ‘What are the earnings we can report this quarter?’” said Mike Florio, a utilities commissioner from 2011 through 2016. “And things really got squeezed on the maintenance side.”

Five years after the explosion, a PG&E line started the Butte Fire, which scorched more than 70,000 acres, killing two people and destroying nearly a thousand homes and other buildings.

State investigators said workers should have known that when they had cleared a stand of trees for PG&E, they had exposed a gray pine weak enough to be blown into a power line. On Sept. 9, 2015, strong winds knocked that tree into the line, igniting the fire.

State officials also blamed PG&E equipment for starting 17 of 21 major fires in 2017 that ripped through Northern California, including wine-growing Napa and Sonoma Counties.

2017 report commissioned by state regulators determined that PG&E often made improvements only after a disaster. The report, which was produced by NorthStar Consulting, also found that the transmission and distribution side of the company had less robust safety policies than its gas and power generation divisions. . .

As soon as safety reduces profit, safety is sacrificed. Companies can do good—from later in the article:

. . . State officials say there is a good template elsewhere in California for what PG&E should be aiming for: the practices of San Diego Gas & Electric.

The San Diego utility keeps data on every utility pole and transmission tower in its service territory, which is smaller than PG&E’s but has a higher proportion of overhead lines in areas at high fire risk. It uses nearly 177 stations to monitor temperature, humidity and wind speeds in an area roughly the size of Connecticut and records video from 100 high-definition cameras. It uses satellites to track how green or dry the grass is and employs the state’s largest water-dropping helicopter to douse fires quickly. When data indicates a high wildfire threat, the utility cuts off power to some areas.

San Diego Gas & Electric upgraded its fire-prevention efforts after residents sued it for causing a devastating wildfire in 2007. In recent years, it has been responsible for far fewer fires than PG&E. “We want to make sure that we’re doing everything we can to mitigate ignition,” said Scott Drury, the utility’s president. . .

They can, but the systemic pressures to increase profit means that more often they will do anything to grow profit.

Written by LeisureGuy

19 March 2019 at 3:59 pm

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