Who Likes the Hobby Lobby Decision? In One Chart

This says it all.

Hobby Lobby DecisionClick here for source.

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Majority of Americans want ACA Improved

Before getting all heated about the inevitable corporate media headlines which will blare “Unfavorable Poll for Obamacare,” go one step deeper into the source and look at the following chart:

Improve ACAThat’s right… they don’t want it repealed or rescinded or whatever. Americans want it improved.

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Getting From the Swampy No to a Functional Yes

SwampWith all due respect to my fellow liberals and progressives — and with this introduction you know the criticism is about to pour forth — enough ink and pixels have given their all in the effort to analyze, explain, or otherwise explicate the ‘problems with the Republican Party’ specifically those who’ve been elected to the House of Representatives.  Enough. It doesn’t matter all that much.

It doesn’t really matter, for example if one adopts the “Neoconfederate” model [Salon] or the “two foundings” explanation [Salon], and we can argue if the ‘two foundings’ in question were the Continental Congress and the Federal System, or the Early Federal Period and the U.S. Civil War.  It’s interesting, it’s academic, and as amusing and thought provoking as the argument is it’s not very useful at the moment.

It doesn’t matter too much if the origins of the present dysfunction are religious, social, racial, psychological, pathological, psychiatric,  or a combination of all the above. What matters is that something is very fundamentally wrong with the way the people’s business in conducted in the Congress of the United States.

Getting To No

As of January 6, 2013 there were 48 members of the Tea Party Caucus, all Republicans.  Of the 435 voting members of the House, 234 are Republican, 199 are Democrats. Two independents caucus with the Democrats.  218 votes are needed to pass legislation. If all the members directly affiliated with the Tea Party Caucus refuse to join their other GOP caucus members, the GOP leadership can control only 186 votes.

In short, the ultra-conservatives in the House of Representatives do not have anywhere near the number of votes necessary to enact the agenda of their choosing, but they have more than enough votes to prevent the leadership from enacting legislation cobbled together with Democratic support.

This is the perfect recipe for NO. No action. No real pragmatic politics. No major legislation. No long term solutions.  The high wire act in the 113th Congress is more conducive to (1) short term stop gap measures to alleviate large problems, (2) interim short term budget appropriations and resource allocations, and (3) periodic breakdowns.

Little wonder then the Absolutely Do Nothing Congress has passed only 34 “ceremonial” bills and “108” substantive bills so far. [WaPo] However, if governmental gridlock is the desired result then the 113th is doing splendidly.

Getting Nothing Done

One of the problems with polarized politics is that hyperbole replaces reasoned discussion, and all too often things become A CRISIS!  There are a couple of ways a crisis can occur. First, and most obviously, there is a situation, unforeseen, which arises from a natural or man-made disaster or catastrophe.  Floods, tornadoes, an attack, an unpredictable infrastructure failure might all qualify as a crisis.

The second crisis category is manufactured.  There appear to be two forms of manufacturing of late. One manifestation is the “political crisis” in which a problem of long standing has been ignored or left unresolved for enough time to create an overwhelming backlog — the Veterans’ Administration issues in regard to wait time for medical services is a classic, as is the number of refugee children who have arrived unattended from Central America — a number that’s been increasing since October 2013.

The other form is more ephemeral and depends upon the Crisis, or Scandal du Jour.  For example, the Benghazi attack in 2012 has generated 25,000 pages of documents submitted in 13 hearings. That the documents have done nothing but reinforce the initial reporting, and that the hearings have generated nothing but easy copy and headlines, is immaterial.  The Congress is ‘dealing with the crisis…’

Meanwhile

While Congress fritters and frets its way to the end of the 113th session there are some issues which may fall into the first manufactured category — the backlog swamp.

Infrastructure: Residents of Los Angeles were recently reminded that 92 year old water pipes cannot be expected to last forever, and when they fail they have no regard for sacred public spaces — like Pauley Pavilion. Over 170 school buildings and 165 bridges in New York were constructed over a century ago. The average age of the 6,800 water lines in New York is 69 years, and 2/3rds of them are susceptible to internal corrosion and failure. [FutNy]  One out of every nine bridges in this country falls in the structurally deficient category, and the average age of a U.S. bridge is 42 years.  [2013RC] We have a early 20th century power grid which is supposed to keep us going in the 21st century. Failure to address aviation needs is costing the U.S. economy valuable revenue as a result of congestion and delays.  [2013rc]

Civil Rights:  The Civil Rights Act, and the provisions safeguarding voting in America are overdue for review. Voter intimidation, suppression, and curtailment are no longer the sole province of the old Confederacy.  We continue to put this issue on the back burner at our peril as a democracy.

Public Health and Safety: Heart disease and cancer continue to be the main causes of death in this country, but Alzheimer’s is climbing up the tables.  An aging population will require more health care services in a wider variety of settings than our current system can address.  We kill 34,677 of us every year in traffic accidents, but we continue to defer highway improvements because of budget constraints.

We kill off 26,631 individuals annually in firearm accidents, another 19,766 in firearm related suicides, and yet another 11,101 in firearm homicides. [CDC]  Still we wrangle about requiring universal background checks and how we might prevent straw purchases.  We can’t even seem to agree that stalkers and spousal abusers shouldn’t have immediate access to firearms.

Whether it’s Alzheimer’s or assault rifles, we’re still operating with entirely too many Medically Under-served Areas, there are 297 such reports for Nevada, and a search of neighboring California turns up 2,065 records. [HRSA]

Immigration: We have a mess going in this department.  It’s hard to ignore the fundamentally racist rantings of the Deport’em Now crowd, who never seem to have much to say about the northern border.  However, we will need to tune them out, or at least down,  if we are going to attract the best and brightest scientific and technical minds we’ll need for a 21st century economy.  We’ll need to figure out how to invite in those who have joined our Armed Forces, willing to die for this country, only to discover later there are voices demanding that they mustn’t  live here. Something rational needs to be done to meet the needs of children who came here as toddlers and have known no other country, and those who have one native born or naturalized parent and another who is not.  Comprehensive immigration policy reform would help. So would adequately funding the judicial, social, and educational components of our immigration policy — security is the easy part — it’s the larger, more complicated portions of the problem we’re delaying.

Might we add more to this list? — items which if we let them progress on their own long enough we’ll find ourselves in a “crisis” situation — climate change, income disparity and inequality, educational funding and curriculum development, and the regulation of capital markets to improve stability.

Our Bottom Line

One of the more egregious practices of failing businesses is the Run To Ruin mentality.  Got an aging delivery truck? Never mind, just keep depreciating it without putting any funds in replacement and capital improvement accounts, and when the thing finally gives up the ghost go out and get another loan to cover the cost.  Delaying serious proposals for maintaining our national safety, health, economy, and infrastructure is tantamount to adopting the Run to Ruin model on a national scale.

Another highly questionable business practice which will lead directly to bankruptcy court is the Disposable Asset Theory of Management  wherein all facets of an enterprise are ultimately disposable, including personnel.  Low wages and paltry benefits yielding high employee turnover? No problem, just hire more and cheaper labor. With 3 job seekers for every position available there will always be somebody.  Eventually those training and retraining expenses will add up, predictably levels of service will decline… and those adherents of the DAT management style should be looking for a buyer sooner rather than later.  Deferring the issues of hiring and retaining well trained and competent public employees is, again, like trying to run the country on the cheap (DAT) and then expressing surprise when “things don’t get done.”

By far one of the most predictable ways to go out of business is to ignore the changing circumstances and economic atmosphere around a firm.  Ever so redundantly speaking — Rule Number One: If you have an increasing share of a declining market you are in very real trouble. Think Kodak.

Let’s be optimistic and believe that eventually we will move from dependence on fossil fuels and toward renewable energy sources.  In old fashioned retail terms this means fossil fuels will be a declining market.  So, WHY are we subsidizing an industrial sector which we know to be on the way out?  Again, if we take a short-term defensive approach to energy policy we’ll be violating Old Rule Number One in ways that will not be helpful in the future — or we can wait for the Crisis in which the oil sector sputters out and takes a chunk of the economy with it.

Avoiding the Run to Ruin, Disposable Asset Theory, and the Ostrich Stance mistakes means we are going to have to stop lurching from crisis to crisis, and start doing some serious public policy planning.  We need to stop talking about running government like a business, and start doing precisely that — running it as a long term, asset rich, enterprise with public service as its core.

Instead of the Doctrine Of No, how about functioning based on the belief that Harry Truman was right: “It is amazing what you can accomplish if you do not care who gets the credit.”

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Heller Helps Sustain Another GOP Filibuster

Heller 3What if there were a bill in Congress which would do the following?

“Amends the Internal Revenue Code to: (1) grant business taxpayers a tax credit for up to 20% of insourcing expenses incurred for eliminating a business located outside the United States and  relocating it within the United States, and (2) deny a tax deduction for outsourcing expenses incurred in relocating a U.S. business outside the United States. Requires an increase in the taxpayer’s employment of full-time employees in the United States in order to claim the tax credit for insourcing expenses.”

In short — offer corporations tax incentives to bring American jobs back to America, or S. 2569.

But then, there’s the GOP side of the aisle saying things like:

“Some Republicans argue that if Democrats truly wanted to keep companies in the United States, they would work with Republicans to overhaul the tax code and reduce corporate tax rates.“It’s a bill that’s designed for campaign rhetoric and failure — not to create jobs here in the U.S.,” Senate Minority Leader Mitch McConnell (R-Ky.) said Tuesday. “Everyone knows that the Democrats aren’t being serious here.” [The Hill]

First, Senator McConnell’s taunt, that the bill is a purely political exercise without any redeeming merit, is simply a legislative version of the Ad Hominem Attack — name calling without addressing the issue at hand. Secondly, Senator McConnell’s definition of “working with” all too often means give us everything we want and we’ll still keep filibustering a measure.  To wit: The bill to require background checks and close the gun show loophole, in which the total gun safety legislative package was pared down to a single issue to appease the GOP and then the GOP filibustered the bill anyway.  Or the Affordable Care Act, originally a Heritage Foundation proposal, which after numerous amendments to assuage the concerns of Senate Republicans received no support from that quarter.

Third, there’s the matter of “working with Republicans to overhaul the tax code,” which assumes that the Republicans have a plan to overhaul the tax code.  The latest GOP tax proposal comes from the House, and would cut the top tax rate from 39.6% to 25%, impose a surtax on some  incomes above $450,000, but leave capital gains taxes at the low rate, to the benefit of hedge fund and wealth management firms. [WaPo] However, the problem with Representative Camp’s proposal is one shared with other GOP plans (health plans, budgets) – the devils haven’t been specified in the details.

The Joint Committee on Taxation analysis indicates the ‘plan’ doesn’t specify the special interest tax breaks which litter the IRS regulations will get the axe in order to make up for revenue lost in the bracket reductions.   The Camp proposal also comes with its own set of complexities, summarized in the Tax Policy Center’s analysis.  To mention just one, there’s the resurrected specter of the Alternative Minimum Tax implicit in Camp’s legislation — nothing like taking up something complicated in order to make another thing simple?

Then there’s some bad news for states, such as Nevada, which do not have a state income tax:

“Camp would repeal the deductibility of state and local taxes, including both property taxes and income taxes. He’d abolish tax-exempt private activity bonds. And he’d impose a 10 percent surtax on municipal bond interest for high-income households, a step likely to raise the cost of issuing state and local debt.But Camp’s plan also includes some less obvious changes that could increase state income tax revenues, especially for states that piggyback on the federal income tax. By limiting deductions—and thus boosting taxable income—Camp’s plan could also increase state income tax revenue, just as the Tax Reform Act of 1986 did.”  [Tax Policy Center]

No matter, the local and state income taxes, which Nevada doesn’t have, would no longer be deductible, but unless there is a state income tax on which to “piggy back” state income tax revenue doesn’t increase under the provisions of Camp’s bill.  Thus we lose the property tax deductions, and gain very little else.

Then there’s the matter of reducing the corporate tax rate. To what? There’s the statutory rate, which Republicans are fond of citing, and then there’s what taxes cost the corporations — or, the effective tax rate.  The GAO reported the effective tax rate for U.S. corporations at 12.6%.  [CNN]  Of course, the GOP response is “ya’shouldn’t hafta get a lawyer to figure out your taxes,” but that’s precisely what major corporations DO. And, they do it with a raft load of tax attorneys.  It doesn’t seem too far out of line to suggest that if the statutory rate were to be reduced to X%, the rafts of tax attorneys would be hard at work seeing how the liability might be reduced to X-Y%.

And while we’re on the subject of complicated tax codes — it does appear a bit unseemly to have the self same initiators and  protectors of tax break loopholes for corporations advance arguments that the tax code is “broken” because it is so complicated.  This would be a good time to click on over to Jon Stewart’s classic rant on tax avoiding corporations, “The Inversions of the Body Snatchers.”

However, speaking of tax breaks for corporations which bring jobs back to American shores… We aren’t going to see those because the Republicans in the U.S. Senate are successfully filibustering S. 2569, and kept their filibuster going in a vote on July 30, 2014 at 10:50 AM. The cloture motion failed on a 54-42 vote, with Senator Dean Heller (R-NV) voting along with Senate Minority Leader Mitch McConnell (R-KY) to further stall the Bring the Jobs Back Bill.

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They’re Back: Banks, SLABS, and the Opponents of Dodd Frank

bankerThere are several reasons the Banker’s Boys in the U.S. Congress would like to rip the guts out of the Dodd Frank Act.  There’s a reason they fought the creation of the Consumer Finance Protection Bureau, and more reasons why the 113th Congress has tried to grab control of the agency, strip the agency of funding, or otherwise make the Bureau a hollow shell of protective camouflage for the bankers.  Here’s one of those reasons:  The Securitization of Student Debt.

Flashback: On August 29, 2012 the Consumer Finance Protection Bureau issued a report on student debt. (pdf)  One section of the Executive Summary contained information which ought to have triggered some alarms:

“From 2005–2007, lenders increasingly marketed and disbursed loans directly to students, reducing the involvement of schools in the process; indeed during this period, the percentage of loans to undergraduates made without school involvement or certification of need grew from 18% to over 31%. As a result, many students borrowed more than they needed to finance their education. Additionally, during this period, lenders were more likely to originate loans to borrowers with lower credit scores than they had previously been. These trends made private student loans riskier for consumers.”

Sound familiar? Have some of the tonal qualities of the Subprime Mortgage Debacle? Over-extending credit, to the less credit worthy, placing them at greater risk of default, and doing it during the Great Housing Bubble?

Flashback 2005: Indeed, by 2005 there was a new bit of jargon in the world of fixed income investments — SLABS, or Student Loan Asset Based Securities.  The definitions can be illustrated by this information from one part of the securities industry:

“Student Loan ABS (SLABS) can be appealing to fixed income investors because they offer high credit quality, credit stability, and low spread volatility. SLABS backed by federally reinsured loans command tight spreads, in roughly the same range as deals backed by credit card receivables or auto loans. SLABS backed by other loans (so-called “private” student loans) command somewhat wider spreads, reflecting incrementally greater perceived credit risk.” [Nomura 2005 pdf]

Not to oversimplify too broadly, but there it was in 2005, a description of asset based securities (packages of student loans securitized into financial products) divided into two parts, the products based on guaranteed student loans and the less secure private student loans.  Note, please, that the advice on offer in this report doesn’t apply to the students who took out the loans — it is advice for “fixed income investors.”

Have we mentioned, at least a gazillion times, that one man’s debt is another man’s asset?  And so, the student loans were packaged (just like the home mortgages) by such dealers as Nelnet Student Loan Trust, Sallie Mae Student Loan Trust, Northstar Education Finance, Collegiate Funding Services, Access Group Inc., Education Funding Capital Trust, College Loan Corporation Trust, and others. [Nomura 2005 pdf]  Here we meet our old friend, the Tranche.

“A piece, portion or slice of a deal or structured financing. This portion is one of several related securities that are offered at the same time but have different risks, rewards and/or maturities.”

Perhaps it was that SLABS were sold as somehow being “safer” investments than their home mortgage cohorts, and maybe safer than the consumer credit securitized assets.  After all, the borrower couldn’t walk away from a student loan in most instances.  What could go wrong?

Flashback 2012:  What, indeed, could go wrong?

“Meanwhile banks have been slicing and dicing student loans into derivative financial instruments called “SLABS” — student-loan asset backed securities. We’ve seen this movie before — the one where big banks mass-market loans to a population with stagnated wages and dwindling economic prospects, then bundle them and sell them to investors who haven’t reviewed the way they were underwritten and sold.” [Eskow, HuffPo]

And, it all worked really well … until it didn’t.  There are those “derivative financial instruments” (read financial paper products) again, and again, and again.  In the wake of the derivative debacle of 2007-2008 the financial sector did some belt tightening and the CFPB was able to report underwriting and marketing changes which were far more responsible.  Additionally, the CFPB ‘autopsy’ of the student loan situation revealed some of the previous practices associated with economic issues:

#1. Some of those who took out private student loans did not understand that they had fewer repayment options than if they had assumed Stafford loans.  This sounds remarkably similar to the mortgage sales which didn’t quite lead to an understanding  about balloon payments, interest rate changes, etc.

#2. The private student loans were most commonly sold to people who were attending for-profit institutions.  While private loans were taken out by only 14% of the total undergraduates, students at for-profit schools held 42%.

And, to make matters even more murky, many of the loans were tied to LIBOR, which was perhaps not as above the board as one might have assumed before 2008. [TP]

July 28, 2014: If a person were thinking the provisions of the Dodd Frank Act, and the activities of the Consumer Financial Protection Bureau may have put more than a damper on the financial sector proclivity to create ways to peddle paper in order to create more ways to peddle paper — please think again.

Enter So-FI, Lending Club, and Prosper. “SoFi’s niche is refinancing student loans. But not just any loans. The kind of schools that are most represented in the program are selective colleges like Harvard, New York University and Northwestern. Their alumni provide the money — The students must also have a job lined up after graduation.” [CNN]  But wait, here comes the packaging. Compliments of Eaglewood Capital which securitized loans from Lending Club.

This time is slightly different. Did we notice that the packaged loans aren’t from the for-profit educational sector? Or, that most undergraduates won’t get re-financed via this new securitization scheme?  Low risk, coupled with above average returns and who might be interested in this newly peddled paper?  If you’re thinking we have the rich bailing out the rich for the benefit of the richer, the conclusion might be close to the target. Fitch explores the prospects:

“In our view, most future securitizations are likely to be concentrated with large non-bank servicers, who are also the traditional FFELP buyers. Of the 13 Fitch-rated FFELP deals that closed in first-half 2014, 10 were issued by Navient Corporation, Nelnet Inc. and the Pennsylvania Higher Education Assistance Agency (PHEAA). As some portfolio acquisitions include servicing transfers, we believe some small NFPs could experience lower account volume and profitability. These servicers are already facing sustainability issues, as some may not have the scale to weather the pressures brought by the Budget Control Act of 2011 and the termination of FFELP. They may also be pressured in the near term by rules proposed by Congress that would establish a common set of performance metrics, incentive pricing for servicers and allocate accounts to NFPs that meet the requirements.” [Reuters] *NFP = not for profit servicers

Those major players from 2008 (Nelnet, PHEAA, etc.) are still playing, and some of the newer participants in the game may not be so profitable in the long run because someone might be watching over their shoulders. “Under a law that took effect in March 2010, the government stopped making student loans through private companies that funded themselves in the market. The government now issues loans directly. Lenders sold $20 billion of student-loan securities last year, down from $62.2 billion in 2005, according to Wells Fargo.” [BloombergNews]

The good news may be that there is less Casino Activity among the bankers in the securitization of student loans, or the creation of SLABS. The bad news is that the bankers are going full bore to get rid of those pesky regulations and the CFPB which serve to put a lid on the Bubble Behavior of the recent past.

The July 23, 2014 session of the House Financial Services Committee took testimony from all the usual suspects on “Dodd Frank: Four Years Later.”  Rep. Hensarling’s Committee heard from the CEO of First State Bank, a partner in Treasury Strategies, an FMC representative on behalf of the Coalition of Derivative End Users, and a ‘resident scholar’ of the American Enterprise Institute.  The counter-balance? Former Representative Barney Frank.  The AEI testimony is instructive, [Pdf] if predictably repetitive.  A summary:

Regulation creates uncertainty, discourages investor due diligence, increases regulatory burdens, gives too much power with too little Congressional oversight, promotes a ‘naive strategy for promoting financial stability, and doesn’t solve the Too Big to Fail problem.

There is nothing new here, merely the recital of every anti-regulation talking point since the dawn of time.  However, redundant as the arguments may be, the  Republicans in the House of Representatives would very much like to repeal the Dodd Frank Act.  During the 112th Congress H.R 87, H.R. 1062, H.R. 1539, H.R. 1082, H.R. 1610, H.R. 1573, H.R. 1121, H.R. 1315, H.R. 836, H.R. 1223, @. 746, and  S. 712 were all introduced intending to either repeal or diminish the regulations in the Dodd Frank Act. In the 113th Congress, H.R. 46 is an outright repeal bill coming from Rep. Michele Bachmann (R-MN) Rep. Ted Yoho (R-FL) and Rep. Adrian Smith (R-NE)

The prospect of a wholesale repeal is dim, but not the notion that the statute could be ‘nibbled to death by ducks.’ [Hill]  House Republicans did manage to get one bill passed in June 2013 to restrict SEC and CFTC rule making capacities — arguing ironically that the agencies had 3 years to get the rules done and had not made enough progress — in the face of nearly overwhelming stalling tactics by financial sector interests and their litigators.

While the CFPB attempts to alleviate the more obvious abuses perpetrated by unscrupulous or unethical lenders, and issues annual reports (most recent 2013) noting that there were 3,800 consumer complaints about student loans, 87% of which were directed at 8 companies. The House Republicans persist in attempts to subject the agency to Congressional micro-management, if not outright dissolution.

We should expect the mid-term election rhetoric to mirror the testimony of the AEI in the most recent House Financial Services Committee hearing.  The Dodd Frank Act will be attacked “in general.” It’s reasonable to predict much will be made of the Too Big To Fail Argument, as if the consolidation of the financial sector is a function of federal statute rather than processes associated with the cyclical nature of financial enterprises.  It will be attacked as “too burdensome” for small banks.  It isn’t. It will be attacked as “big government.” Any attempt to reign in the Bankers will always be so characterized.

What opponents of financial regulatory reform won’t discuss is how the Consumer Financial Protection Bureau is attempting to guide the lenders and by extension their secondary markets into the construction of a more equitable, operable, less volatile, and more sustainable student loan sector.

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The Intractable Riddle: US Policy in the Middle East

Middle eastern foreign policy is the one topic assured to bring the house down around the ears, no matter what position may be taken.  The continued ill-will between the Palestinians and the Israelis is at once both one of the most complex and nuanced of conflicts, and one of the most blatantly bisected into warring quarters.   Sometimes we also forget that what is foreign policy for us, is someone else’s domestic policy.

Recommended Reading

Nahum Goldmann, “The Future of Israel,” Foreign Affairs, April 1970.  There is much to be extracted from this piece, even though it is framed in Cold War terms and assumes the polarization of the Soviet Union and the United States.  Among other insightful statements, Goldmann offers the prescient comment that gains secured by force of arms are, by their very nature, transient.

The domestic politics of Israel are summarized, albeit too briefly, in Brent Sasley’s “The Domestic Politics of Israeli Peacemaking,” Foreign Policy, July 22, 2013.  A piece in the Cyprus Mail, brings the problems into sharper focus:

“Recent statements by Israeli Prime Minister Benjamin Netanyahu suggest that he is increasingly aware of the fundamental dilemma that Israel is bound to face: If it holds on to the occupied territories, it will be forced to choose between being a Jewish but non-democratic state and being a democratic state but seeing the Jews become a minority in their own land. It is unclear whether this dilemma is a pressing concern for the current government, but the fact that Netanyahu brought it up is quite significant.” [CM March 11, 2014]

On the other side of the border, Hamas won the 2006 elections in Gaza, but it’s hardly the only group in play.  The Jewish Policy Center has  thumb-nail sketches of the other players in the game as they were constituted as of May 2012.  Just as there are segments of Israeli politics which are incorporated into the mix of domestic/foreign politics, there are several groups which have adherents in Gaza who are not directly associated with Hamas.

Palestinian Islamic Jihad is once such group, supported by Iran, it is apolitical and primarily interested in armed resistance to Israel, [CFR]  The Al-Quds Brigade has also made its presence known in the recent conflicts with Israel, as the armed wing of the PIJ. [Al Arabiya] Efforts to negotiate any truce or even cease fire agreements has to acknowledge that the Azzeddine el-Kasam (armed wing of Hamas) may or may not be able to control the PIJ or coordinate with it.  In sum, there is no shortage of groups of varying physical capacities, membership, affiliation, and ideological strains in Gaza. Nor is one likely to find an undated  ‘scorecard’ which includes all the possible variations.*

Our Domestic Issues

The right wing talking point of the day is that Secretary of State John Kerry is “feckless.” This category would include almost anyone who (1) isn’t following the Israeli lead unconditionally, and (2) has the temerity to suggest that there are other players in the game who have some, even small, parts which might be inserted into the script.

Consider for a moment, the last cease fire negotiated, the one in which the Egyptian government (Muslim Brotherhood) was trusted by Hamas, and could assert pressure on the government in Gaza to accept terms.  Since the ouster of the government in September 2013, the now clearly anti-Hamas Egyptian government no longer has leverage in the situation in Gaza.  Israel, no doubt would prefer to have the military government of Egypt as the interlocutor, but this seems almost like wishful thinking for times now gone in the rubble of Egyptian politics.  Secretary Kerry suggested two other interlocutors — Qatar and Turkey — which now may have more leverage with Hamas, to the fury of the Israeli press. [Haaretz]

While the shuffling and realignment of Hamas and its allies plays out the role of the Palestinian Authority remains a problem. Does acknowledging Gazan/Hamas issues necessarily diminish the clout of the Palestinian Authority?  How can we keep Egypt engaged in the peace process while accepting that the Gazan/Hamas government doesn’t have much use for their services?

Is it enough to say that a cease fire — who’s even hoping for a truce now? — mentions “addressing security issues” as an umbrella for more specific discussions, or must the agreement include particular security issues to be resolved, or at least discussed? And, by whom?

Complicating the matter even more are the charges and counter-charges shedding  more heat than light on the subject.  Even a comparatively innocuous timeline of events in Gaza drew angry fire from commenters who decried its failure to include elements of the conflict going back to the foundation of the state of Israel, and the validation of Palestinian claims after World War I. [CNN]

At the very least we have a conflict in which Goldmann’s central question from 1970 (Is Israel a democracy with a Jewish minority, or a Jewish state without a democracy?) and his secondary question, (How does one disentangle a question in which there is no right or wrong, but two rights in conflict?) both remain unanswered.

See also: Palestinian Islamic Jihad, al Quds Brigades, Fatah, PFLP  Abu Ali Mustafa Brigades, Popular Resistance Committees, Salafi-Jihadist (Jaish al-Islam) and Tawid wa al-Jihad.

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Filed under Foreign Policy, Israel, Middle East, Politics

Before You See The Sunday Shows: Thoughts on Broadcast News

Television Set AntiqueEvery time there’s a rumor about replacing hosts on the Sunday morning political shows, or when the dismal ratings are released, we can easily project another gazillion tweets, posts, emails, etc. about the demise of the broadcast media and it’s lack of imagination, depth, and ‘truthiness.’  Before declaring we live in the Worst Times Ever, or that the corporate media is an accessory to the diminishment of ‘real news,’ there are a few things to consider.

Advertisers in the Wasteland

We, the viewing public, aren’t the real consumers of television broadcasting — or the newspapers for that matter.  The people who pay for the productions are the advertisers.  Always have been.  And who is paying the freight?

In 2013 AdAge reported that “Meet The Press” had about 3 million viewers, and that approximately 55% of them had annual incomes above $100,000.  Who would want to speak to that audience?

“Boeing Co., targeting an audience of military executives, is the exclusive sponsor of the show’s online content as well as its apps; it is also a major broadcast sponsor. Other advertisers include the American Petroleum Institute, Citigroup, General Electric Co. and Xerox. “It’s a gray audience and exceedingly affluent,” said Brad Adgate, senior VP-research at Horizon Media. “These people are interested in politics and decision-making, and how that can impact business.” [AdAge]

A gray, affluent, audience.  Does this help explain why Meet the Press rounded up all the usual neo-conservative suspects for its discussions about the renewed violence in Iraq?  [MMFA]  When you target “an audience of military executives” what might the preferred guests want to express?  A gray, affluent, (read: Republican) audience doesn’t particularly want to watch the debunking of the various and sundry myths about Benghazi, so Meet the Press didn’t have that exercise on offer.  [MMFA]  This is an audience which wants to hear about politics, so that’s what they get — politics, not policy. They want to hear about decision making — especially people making decisions which relate to their (oil, energy, financial, banking, military weapons and supplies) businesses.

NBC has done some tinkering with the Meet the Press format, smaller segments, more interviews, but when the target audience is ‘gray and affluent’ and ‘military executives’  the network shouldn’t be surprised that it’s still running third in the 25-54 year old (people who spend money) demographic. [MediaBistro]

Progressives, liberals, independents, and others of a more centrist bent may watch the program — but they’re well advised that they’re the minority in the statistical universe of the Meet The Press audience.

Where’s the audience who is not ‘gray, affluent, and a business executive?’  Remember this chart from the Pew Research publications in 2012?

Where Get News ChartThey’re more likely to get their news from digital sources than from print or radio.

Getting news from television broadcasters? That percentage has dropped from 68% in 1991 to 55% in 2012.

It’s not that journalism is necessarily dead, or dying, but it’s increasingly digital.  In 2011 about 8.6% of newspapers were digital, a number which increased to 14.2% only a year later. By 2012, the digital readership of the New York Times was greater than its print readership.  [SMH]  And it’s not just newspapers and major networks:

“…the regular audience for cable news also has aged. In 2006 and 2008, there were only modest age differences in regular cable news viewership. But in the current survey, more than twice as many of those 65 and older as those younger than 30 say they regularly watch cable news (51% vs. 23%).” [Pew]

Rather more than tinkering with the ‘product,’ NBC, and perhaps the other Sunday Morning Shows, may want to consider this analysis from two years ago, and at the same time give some thought to another question:  In your eagerness to please a specific set of deep pocketed advertisers have you already written off efforts to connect with, and grow, a wider spectrum of audience members?

The Perils of Partisanship

Red ChannelsWe’ve seen this movie before.  The power of some advertisers can be a hazard to our public health.  There are fewer people now who remember Red Channels.  Most people have some familiarity with McCarthyism, or with the activities of House UnAmerican Affairs Committee, but the pressure on major networks to cancel programs because of the political beliefs of the participants was boosted in June 1950 by the publishing of Red Channels.

“…the process (of Black Listing)  became public in June 1950 with the publication of Red Channels, a 213-page compilation of the alleged Communist affiliations of 151 actors, writers, musicians, and other radio and television entertainers. The book, which appeared three days before the start of the Korean War, was published by American Business Consultants, an outfit established in 1947 by a trio of former FBI agents who wanted to make the public aware of the information about communism that the bureau had collected. Initially funded by Alfred Kohlberg and the Catholic Church, the group became one of the anti-Communist network’s main enterprises, offering its services in exposing and eliminating Communists to corporations, foundations, and government agencies. Red Channels was a special show business supplement to the exposes of individuals and organizations that appeared in the group’s regular newsletter, Counterattack.” [Schrecker UPenn]

The pamphlet had enough clout with advertisers and networks that as prominent a celebrity as George Burns dropped a cast member from his show in 1951 because his name appeared in the list.  [NPR]  Film and television actress Marsha Hunt was offer shows by three networks, all of whom backed out when her name appeared in the Black List. [NPR]  There is more complexity to the Case of Sam Spade. Was the famous detective, voiced by Howard Duff, taken off the air by NBC in 1950 because Duff’s name was among those in Red Channels? Or, was the main problem due to continued litigation by Warner Brothers who clutched the Maltese Falcon, and the rights thereto, with an iron grip? [Wik] [ROKradioRadio Spirits concludes that the program staggered to an end when the sponsor, Wildroot (hair product) refused to renew its support if Duff remained associated with the program.

Even a Syracuse, NY supermarket chain owner, Laurence Johnson, made an impact.

“Johnson, an owner of six supermarkets in central New York, pressured CBS to stop employing comedian Jack Gilford and any other “‘subversive'” (p. 124). With the war against the Communists in Korea heating up, Johnson sent telegrams to network sponsors, in which he wrote: “‘Why are you helping to kill our friends in Korea?'”  Small-city radio stations resisted Johnson’s strong-arm tactics, but the national networks, advertising agencies, and sponsors often capitulated.” [HNetRev]

One of the obvious lessons of the Red Channels/McCarthy Era is that pressure on commercial broadcasting networks can work to exclude both participants and their ideas from public  news and entertainment.  The more participants and perspectives are excluded the more narrow the range of the discussion.  If the advertisers prefer, as in the case of Mr. Johnson, that no views other than that which appeals to the gray, affluent, and 100% American, then how does a network hope to attract a wider audience?  If the networks have to please such advertisers, while alternately insulting, misinforming, or dismissing the views of those not aligned with them, then how do they cope with this modern incarnation of McCarthyism?

It may be physically impossible for a person to manually strangle himself, but it might just be possible for network executives to accomplish this in a corporate context.

The Financial Stakes Race

The struggles of CNN may be a case in point.

On May 1, 2014 CNN announced another round of layoffs across several divisions. [TheWrap] In January 2001, the network laid off about 10% of its workforce.  There were to be smaller news-gathering teams.  They would be emphasizing “breaking news.” [LATimes]  Neither of these announcements, 13 years apart, should come as any surprise to those who have been following the corporate career of Time Warner.  It’s not enough to merely provide the best news coverage, or even the latest — it must be done with an eye toward the old and familiar Blunt Instrument, shareholder value.

None of the networks are immune.

The restructuring of news gathering, be it streamlining, pooling, or team creation, has meant there are fewer reporters in fewer places covering fewer stories. The unintended consequences of all this paring and scraping is fewer experts, covering fewer stories, in less depth.  Little wonder opinion and speculation are winning the competition for news and context during broadcasts.

Nor does it seem as though “Creativity” is running well on the inside rail in this race.  Television can all too often be a derivative medium.  Is there a successful comedy show — then expect spin offs — not really new.  Is there a successful news magazine, a 60 Minutes for example, then expect the competitors to launch their own — not necessarily a new form of show. If it is necessary to sell commercial time, then there’s a coterminous pressure to tell the advertiser: Look how successful “Party Time in Los Angeles” is! We can replicate that with “Party Time in Pensacola!” It would be nice if all new shows, both news and entertainment, were truly new — but that would be to ignore decades of derivative programming.

We Interrupt this broadcast…

To tell you what you already know.  We have a commercial broadcast news structure which is dependent on advertising for its existence.  The dependency on advertising means that those who purchase commercial air time have a profound effect on the type of fare served to the public.  In the best of times this can produce a wide range of diversified views, in the worst it can stifle the production and the producers casting them into an ever narrowing range of acceptable perspectives.  And, given the need to ‘sell’ advertisers on the safety of their investment in commercial time, the past will always have  a heavy hand on the present.

The ‘kids’ may already have the answer to this problematic situation; as long as they have their fingers (and thumbs) clutching their mobile devices — Surfing, Googling, and Networking their way into more information than any old time newspaper could put into print.  Meanwhile, the Gray & Affluent will attend to the comfort of their convictions, secure in their recliners that they will hear from their sympathetic advertisers the message they meant to receive before they even hit the power switch.

 

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