Posts by David Sirota

David Sirota is a veteran political strategist and author of Hostile Takeover, a New York Times bestseller about the corruption of both political parties.

Taking the Theory Out of Conspiracy
Posted by David Sirota, Open Left on May 25, 2009 at 1:45 PM.

This ABC News story won't help quell conspiracy theories about a Grand Council of Rich People conspiring to control the world:

Under a cloak of secrecy, some of the world's wealthiest people gathered in an unprecedented meeting early this month in New York City "to see how they can join together to do more," according to one attendee.

Invited by the world's two richest men Bill Gates and Warren Buffett, along with David Rockefeller, a Who's Who of American wealth and influence gathered around a long table in a window-lined private room overlooking the East River on May 5...

A clandestine meeting of the country's rich and powerful, left off their public calendars and hidden from the press, is enough to spark the imaginations of conspiracy theorists everywhere.

My take on this kind of stuff is pretty simple: While some of the Bilderberg Group/Trilateral Commission/Rothschild Power obsession gets irritatingly close to Protocols of the Elders of Zion/International Jewish Cabal crap, it's no "theory" to believe that rich people work together to protect their wealth. Whether this meeting is truly a philanthropic venture or something more nefarios is kinda beside the point - all you have to do is look at, say, the Davos conference to know that the wealthy work to hoard wealth.

Just When You Thought the Corporate Rip-Off Schemes Couldn't Get Any Worse...
Posted by David Sirota, Open Left on May 22, 2009 at 10:02 AM.

This month, the Obama administration unveiled a plan to reform the taxes that apply to life insurance. Not surprisingly, the insurance industry freaked out, paushing out its spokesman to say "This is absolutely the wrong time to make it more expensive for families, as well as U.S. businesses, to obtain the security and peace of mind our products provide."

That sounds reasonable, until you read this incredible new report from the Wall Street Journal about how insurance companies use current tax rules not to help "families obtain security and peace of mind" but to help fat-cat executives pad their salaries:

Banks are using a little-known tactic to help pay bonuses, deferred pay and pensions they owe executives: They're holding life-insurance policies on hundreds of thousands of their workers, with themselves as the beneficiaries.

The insurance policies essentially are informal pension funds for executives: Companies deposit money into the contracts, which are like big, nondeductible IRAs, and allocate the cash among investments that grow tax-free. Over time, employers receive tax-free death benefits when employees, former employees and retirees die.

Though not improper, the practice is similar to what is known as "janitors insurance," an insurance-on-employees technique that has long been controversial. Critics say the banks' insurance contracts are a way for companies to create tax breaks for funding executive pensions. And some families have complained that employers shouldn't profit from the deaths of their loved ones.

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Trade Fight: Labor Slowly Moves Into Position to Oppose Obama
Posted by David Sirota, Open Left on May 20, 2009 at 10:04 AM.

Here's what we know when it comes to trade:

- President Obama campaigned on a promise to substantially change America's trade policies and move us off of the failed NAFTA trade model.

- Labor unions took that promise seriously, and therefore spent millions of dollars of workers' hard-earned wages to help elect President Obama.

- Obama's U.S. Trade Representative now says he is looking to pass Bush-negotiated, NAFTA-style trade deals with Panama, Colombia and South Korea. While he says he wants some tweaks to these deals, they are still the NAFTA model.

- Obama's chief of staff, Rahm Emanuel, is still giving speeches publicly bragging that he helped pass NAFTA.

- Thanks in large part to the NAFTA trade model, taxpayer funded bailouts of key industries could end up subsidizing the offshoring of American jobs.

Now, after all of this, we're finally getting a proper reaction from labor leaders in Washington, D.C.:

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Time for Reform: 20-Year-Old Intern Easily Forms Offshore Tax Haven
Posted by David Sirota, Open Left on May 19, 2009 at 1:59 PM.

Bloomberg News this morning reports that U.S. Trade Representative Ron Kirk gave a speech yesterday to the U.S. Chamber of Commerce "saying he hopes Congress will approve stalled trade agreements with Panama, Colombia and South Korea within the next year." The good news is that Kirk also  noted that Bush-written trade policies are "really a tough sell in this environment."

They certainly should be - our lobbyist-written trade policies have significantly contributed to the economic collapse, hollowing out America's good-paying job base for years. Indeed, just yesterday, we see what that means: As the government bolsters domestic automakers, our rigged trade/international economic policies may undermine those efforts by allowing taxpayer cash to subsidize more job outsourcing.

The good news out of Kirk's speech was the fact that he "said negotiators in his office are working 'furiously' on labor and tax issues with Panama." At a time of massive budget deficits, that's an important step - especially when you consider how easy it currently is to hide tax income in a tax haven like Panama. Check out this video from Global Trade Watch - notice that the organization's intern is able to quickly set up a shell corporation to hide tax revenues:

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First Amendment Rights Watch: Criminalizing the Internet
Posted by David Sirota, Open Left on May 15, 2009 at 3:25 PM.

In the last few years as my work has increasingly integrated with the Internet, blogosphere and Netroots, I've been constantly reminded that there are a lot of great people out there - but I've also been reminded that there are a number of really crazy, nasty, unhinged and generally bad people out there, too. The Internet's unique mix of interactivity, instant response and anonymity can really bring out the worst in people - all you have to do is read the comments sections on many major blogs, both liberal and conservative, to know that there's a lot of hate out there.

However, the Internet is a terrifically democratizing force, and while most of us can't stand the haters who try to hijack this medium for their own sad agendas, any effort to criminalize speech in this medium is really unacceptable.

Unfortunately, such an effort is underway, headed by Democratic Rep. Linda Sanchez (D-CA). As Wired magazine notes, her bill, HR 1966, is called the "Cyberbullying Prevention Act" and includes this section:

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The Bank 'Stress Tests' Were Neither Stressful Nor Tests
Posted by David Sirota, Open Left on May 12, 2009 at 9:13 AM.

So, call me crazy, but I thought after the Enron and Arthur Andersen meltdowns, the government had gotten out of the business of bending over backwards to help companies cook their books. In fact, yes after reading this Politico piece by the generally solid Eamon Javers, it seems I am crazy.

The article goes over 5 different ways the Obama administration turned the much-vaunted "stress tests" into government seals-of-approval for all sorts of accounting shenanigans. Here's an example:

December was probably an awful month for Goldman Sachs. What to do? Make it go away. The investment house changed its fiscal calendar, so that the year ended in December, rather than in November in the past. That had the effect of eliminating December's results from public disclosures...

Firms took advantage of new accounting rules that can make the same business results look better on the bottom line - like the way Citigroup added an additional $2.7 billion on the bottom line simply by tweaking the math for the first quarter.

It worked. Traders started buying bank stocks again, and the White House didn't make a peep of complaint.

What's amazing is that the media and the administration even called these "stress tests" tests at all, considering "The government announced early on in the process that every single bank would "pass" the stress tests."

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Is Obama's 'Major' Health Care Announcement Just a Bunch of Bull?
Posted by David Sirota, Open Left on May 11, 2009 at 9:33 AM.

So the big news today is President Obama's press conference with the health insurance industry touting the industry's "voluntary" commitment to slashing $2 trillion off Americans' health care bills over the next decade. The New York Times reports that this voluntary announcement is motivated by the health insurance industry's "hope to stave off new government price constraints that might be imposed by Congress or a National Health Board of the kind favored by many Democrats."

My three questions are really simple:

1) If the health industry is saying it can lower costs by $2 trillion over 10 years and remain highly profitable, isn't the industry admitting that it was planning to absolutely bilk consumers, and has been bilking consumers in the past? Put another way, isn't the industry admitting that it's entire business model is based on outright profiteering?

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Arlen Specter Would Have a Real Uphill Battle In a Democratic Primary
Posted by David Sirota, Open Left on May 7, 2009 at 4:12 PM.

DailyKos's new Research 2000 poll shows that 63 percent of Pennsylvania Democratic primary voters either definitely will vote against Arlen Specter in the Democratic primary, will consider voting against him, or don't know how they will vote. Those are incredibly weak numbers for a sitting senator. Indeed, you know they're weak when you consider that if you saw those kinds of primary numbers for a regular ol' senator who hadn't switched parties, and that senator had major candidates (including a sitting House member) considering a primary, the entire political Establishment would be calling that senator a political dead man walking.

Of course, most of the political Establishment in Washington, D.C. is saying the opposite - that Specter is basically unbeatable, even as major candidates like Rep. Joe Sestak (D-PA) and Joe Torsella are threatening a primary. As this poll shows, that pro-Specter wishful thinking is just that: wishful thinking.

Between Pennsylvania and Colorado, we could (and I stress could) have two major Democratic senate primaries on our hands that break down along ideological lines, that would be valuable movement-building vehicles, and that would help change the obstructionist dynamic in the U.S. Senate. It's pretty exciting.

AIG Bonuses Nearly Four Times Larger Than Originally Disclosed
Posted by David Sirota, Open Left on May 6, 2009 at 12:45 PM.

Remember how Congress and the White Houe decided to do nothing when it was told AIG was paying out $165 million in bonuses? Remember how we were told that wasn't a lot of money, while the White House was simultaneously telling us less money was a lot of money? Well, check out this little-noticed update from ABC News:

Inflation: AIG Bonuses Nearly Four Times Larger Than Thought

ABC News' Matthew Jaffe Reports: AIG, the recipient of approximately $180 billion in government bailout aid, paid out over $454 million in bonuses company-wide in 2008, according to documents that the company submitted to Congress.

The embattled insurance company, which ignited a heated controversy in March for dishing out $165 million in retention payments to employees in its troubled Financial Products division, revealed the bonuses in response to written questions from Rep. Elijah Cummings, D-Md.

The $454 million number is now the third different figure that AIG has disclosed for its 2008 bonuses, with each number far larger than the previous one.

Maybe Congress will do something now...nah, probably not. We'll probably be told that half a billion dollars isn't important.

Hey Obama, Is $100 Million a Lot of Money or Not?
Posted by David Sirota, Open Left on April 30, 2009 at 12:53 PM.

About a month ago, Obama administration officials like Rahm Emanuel and David Axelrod were storming Washington, D.C. television studios to insist that $165 million in AIG bonuses wasn't a big deal. The basis for their argument was the contention that, in the context of the federal budget and financial crisis, $165 million is a tiny amount of money that nobody should really care about (this rationale is why the Congress ultimately did nothing to stop the AIG bonuses).

Yet, last week, the same Obama administration is running back to the same Washington, D.C. media insisting that the president's demand for his cabinet officials to cut $100 million in federal spending is a very big deal:

"Only in Washington, D.C., is $100 million not a lot of money," Gibbs said. "It is where I'm from. It is where I grew up. And I think it is for hundreds of millions of Americans."

I'm confused. Does the Obama administration think $100 million (or $165 million) is a lot of money or doesn't it? Or are we expected to believe it's a tiny amount of money when it might embarrass the administration, but a huge amount of money when it might cast a positive light on the administration?

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Creating A Wage-Cutting Race Is Not 'Humane,' Good for Immigrants or Good for America
Posted by David Sirota, Open Left on April 25, 2009 at 9:02 AM.

Following on my last post about immigration, I wanted to make sure everyone saw this important - if buried - piece from the trade press:

April 17, 2009 (Computerworld) The use of H-1B workers by U.S. companies is decreasing wages for computer programmers, system analysts and software engineers by as much as 6%, according to a study released this week by researchers at New York University's Stern School of Business and the Wharton School of the University of Pennsylvania...

"In this paper, we simply sought to dispel the myth that globalization generates no losers," wrote Prasanna Tambe, an assistant professor of information, operations and management sciences at the Stern School, and Lorin Hitt, a professor of operations and information management at Wharton.

The high-tech industry would have us believe that the H-1B program exists to help them find workers when they can't find qualified American workers, and a mythology has emerged that claims H-1B workers have to be paid the same as domestic workers, and therefore avoids creating a wage-cutting competition.

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Resisting False Choices & Getting to a Truly Humane Immigration Policy
Posted by David Sirota, Open Left on April 23, 2009 at 9:25 AM.

In the debate over immigration, interest groups like the Chamber of Commerce would have us believe that there are only two positions: Either you are a tolerant and good person who supports "reform" or you are an evil racist who wants to build a wall at our southern border. Likewise, genuine xenophobes and racists would have us believe you are either a patriot who supports "border security" and wants to preserve "our culture" (read: white culture) or you hate America and are a traitor.

These are (obviously) oversimplified frames, and for a reason: Racists want to polarize the debate on nationalistic terms, and Big Money interests want to use immigration "reform" - most prominently through a so-called "guest worker program" - to create a permanent underclass of immigrants to economically exploit.

IMHO, this latter strategy is most dangerous, because whereas racists/xenophobes are pretty open about their xenophobia (and whereas polls show most Americans want tolerance in our immigration policy), Big Money is wrapping exploitative policies in the patina of human rights and tolerance. 

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Journalism, the Drug War and Democracy: Bill Moyers' Must-See Interview with 'The Wire' Creator David Simon
Posted by David Sirota, Open Left on April 20, 2009 at 8:57 AM.

Over the last few weeks, I've written columns about the drug war and the demise of journalism, and I cited David Simon, the Baltimore Sun reporter turned creator of HBO's "The Wire." This week, Bill Moyers had Simon on his PBS show to expand on this topic, and it was one of those rare must-watch interviews that you see on television. You can watch it here, and I highly recommend you do.

Simon is firing on all cylinders throughout the interview, but I found this statement on the politics of the drug war particularly poignant:

Listen, if you could be Draconian and reduce drug use by locking people up, you might have an argument. But we are the jailing-est country on the planet right now. Two million people in prison. When I started as a police reporter, 33, 34 percent of the federal inmate population was violent offenders. Now it's like, seven to eight percent. So, we're locking up less violent people. More of them. The drugs are purer. They've not-- they haven't closed down a single drug corner that I know of in Baltimore for any length of time. It's not working. And by the way this is not a Republican/Democrat thing. Because a lot of the most Draconian stuff came out of the Clinton Administration. This guy trying to maneuver to the center, in order not to be perceived as Leftist by a Republican Congress.

Simon is absolutely right - the dynamics of Washington politics have long required Democrats to try to look more "tough on crime" than Republicans, for fear that they will be successfully tarred and feathered as "weak" via derivatives of Willie Horton ads. But I think things might be changing, if ever so slowly.

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D.C. Reporters Just Make Sh*t Up, Part 1,489,890,992,384
Posted by David Sirota, Open Left on April 19, 2009 at 6:03 AM.

I was reading this [link fixed], the zillionth "analysis" of political populism from a Washington, D.C.-based reporter, when I came upon this pretty perfect example of how Beltway journalists just make shit up:

The country today is different. America has an enormous middle class that is heavily invested in the financial system and is hardly about to organize for its overthrow...

People who have lost half the value of their 401(k) plans, in other words, want to regain it by having the economy rebound, not by seizing the assets of ExxonMobil Corp.

If this reporter was even the slightest bit interested in whether this banalia was true, he would have spent all of 5 seconds on the Google and found that actually, empirical public opinion data shows that Americans are quite supportive of "seizing the assets" of oil companies like ExxonMobil.

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The Right Goes Batshit Crazy Over Progressives' Huge Tax Victory
Posted by David Sirota, Open Left on April 6, 2009 at 12:26 PM.

In OpenLeft's ongoing coverage of the most important tax fight you've never heard about, I wanted to point out just how huge a conniption fit the national conservative movement is having over New York state progressives' success in preventing health care cuts by raising taxes on millionaires.

Check out this overwrought fulmination from Rupert Murdoch's New York Post. You have to read this thing to believe it - yes, the small grassroots Working Families Party (WFP) is evil and awful for organizing middle and working class people into a powerful political force in state politics - one that is key to this tax reform initiative. The Post explicitly attacks the WFP for developing a "foundation of influence in Albany" through it "canvassing prowess" - as if developing political power through door-to-door organizing is an absolutely awful thing.

That was topped only by de facto National Republican Party Chairman Rush Limbaugh, who used his national radio show to declare that he's selling off his luxury condo in New York because he doesn't want to pay the millionaire's tax.

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