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MARK KARLIN, EDITOR OF BUZZFLASH AT TRUTHOUT

sep162016 warrenElizabeth Warren during the opening of the Consumer Protection Financial Bureau, which she designed, in 2010. (Photo: Consumer Financial Protection Bureau)

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Last week, I wrote a commentary on how approximately 5,300 Wells Fargo bank staff members had been fired for allegations of creating millions of fraudulent credit card and savings accounts. It appears that the Wells Fargo employees were feverishly trying to meet high marketing quotas to receive bonuses. It also appears that Wells Fargo executives overlooked the rampant illegal behavior, amidst a climate that emphasizes increasing the number of accounts without scrutinizing the tactics used to do so.

Wells Fargo does not appear to be investigating whether or not Carrie Tolstedt -- who oversaw the division where the phony accounts were set up -- should be held responsible for the bank fraud uncovered by the Consumer Financial Protection Bureau (CFPB). National Public Radio (NPR) reported that Tolstedt had previously planned to retire from her position and "is set to depart her post with $124.6 million in stock and options." NPR added:

"When Carrie Tolstedt's retirement was announced in July, Wells Fargo CEO John Stumpf called her a 'dear friend,' 'role model' and 'standard-bearer for our culture.'

A culture of government overlooking corruption on Wall Street led to the 2008 economic crisis. Now, Sen. Elizabeth Warren (D-Massachusetts) who created the CFPB is saying that the US government -- including the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) -- are, yet again, going easy on large financial institutions who continue to engage in multi-pronged rogue behavior. "There's a serious problem with senior management at Wells Fargo," Warren told CNBC earlier this week.

MARK KARLIN, EDITOR OF BUZZFLASH AT TRUTHOUT

2016savevoteThe right to vote should be universal. (Photo: H2Woah! )

Nearly six million people with felony confictions will not be able to vote this November, because the states in which they live do not restore their voting rights after they have served their sentences, according to The Sentencing Project. This loss of the rights of citizenship can have a profound impact on individuals and elections. In fact, Al Gore might have won Florida in 2000 by tens of thousands of votes, if Jeb Bush and his then Secretary of State Kathryn Harris hadn't employed a firm, Choicepoint, to eliminate tens of thousands of people with felony records -- as well as people with identical names to those with felony records -- from the voting rolls.

That is only part of the felony disenfranchisement story in Florida. According to a 2015 Florida SunSentinel article:

Commit any felony in Florida and you lose your right to vote for life -- unless the governor and the clemency board agree to give that right back to you.

The result: more than 1.6 million Floridians -- about 9 percent -- cannot vote, hold office or serve on a jury, according to The Sentencing Project, a prison-reform group.

The FloridaSentinel notes that very few people are able to have their rights restored; in the past four years, only 1,534 people with felony convictions have had their full rights, including voting, restored.

Friday, 09 September 2016 05:51

Big Bad Big Banks Continue to Behave Badly

MARK KARLIN, EDITOR OF BUZZFLASH AT TRUTHOUT

wellsfargoBig banks continue to get slaps on the wrist for illegal practices. (Photo: Mike Mozart)

If you think that big banks only behave badly in the derivative and sub-prime mortgage markets, you've only noted a few of their financial misdeeds -- in this case two reckless behaviors that were key to the 2008 meltdown of the economy.

Many people aren't aware that some of the big banks have also been knowingly involved in accepting cash from drug cartels. For example, Bloomberg News reported in 2013,

HSBC Holdings Plc’s $1.9 billion agreement with the U.S. to resolve charges it enabled Latin American drug cartels to launder billions of dollars was approved by a federal judge.

HSBC was accused of failing to monitor more than $670 billion in wire transfers and more than $9.4 billion in purchases of U.S. currency from HSBC Mexico, allowing for money laundering, prosecutors said. The bank also violated U.S. economic sanctions against Iran, Libya, Sudan, Burma and Cuba, according to a criminal information filed in the case....

The bank, Europe’s largest, agreed to pay a $1.25 billion forfeiture and $665 million in civil penalties under the settlement, prosecutors announced in December.

A Guardian US article noted at the time of the financial penalty,

Mexico’s narco nightmare now counts 100,000 dead and some 20,000 missing; there is no overstating the misery of its export -- hard drugs -- around the world. Yet only one stepping stone connects HSBC to this carnage and misery: the bank acted as the cartel’s financial services wing....

MARK KARLIN, EDITOR OF BUZZFLASH AT TRUTHOUT

The other night, I was watching a historical documentary on World War I. That conflict, which was supposed to be "The War to End All Wars," resulted in the deaths of approximately 38 million people: soldiers and civilians. Barely 20 years later, the rumblings of the World War II had begun, which would result in the murders of more than 70 million people.

At the end of the First World War, the British government undertook a propaganda campaign to justify the senseless and barbaric bloodletting that had occurred, resulting in approximately one million British soldiers killed and more than two million wounded. The government built a series of monuments honoring "The Glorious Dead" -- using a memorial slogan invented to justify the war as a great worthwhile "sacrifice." Architects were contracted to build memorials around the British Empire with either that phrasing or the more embracing slogan "Our Glorious Dead."

8315146760 79400a5375 m 1(Photo: Defence Images )

6346499271 3f86331219 m copyWorld I monument erected outside Whitehall in London honoring "The Glorious Dead." (Photo: Donna Rutherford)

MARK KARLIN, EDITOR OF BUZZFLASH AT TRUTHOUT

15057321270 5a0f1047ed zOil pipelines not only pose an ongoing peril, the companies benefit from not paying taxes and being allowed to charge excessive rates. (Photo: Luke Jones)

Oil pipeline companies represent the predatory flow of capitalism unrestrained by responsibility for environmental destruction, contribution to global warming, scarring the natural landscape, and violating the rights of Indigenous people and others through the use of eminent domain to construct the pipelines. That list of foul deeds is just for starters.

That's why a September 1 article in The Daily Beast by Pulitzer Prize-winning journalist and friend of BuzzFlash David Cay Johnston is particularly alarming. Johnston details how many large oil pipeline companies are essentially exempt from corporate income tax. Not that anyone should be surprised that a destructive industry should be rewarded with special tax breaks. In fact, just yesterday we highlighted a report on how big banks receive tax breaks for enormous "performance-pay" bonuses given to CEOs. 

What's more, Johnston points out that due to a recent arcane ruling by the DC Circuit Court of Appeals, many oil pipeline companies are allowed to include a tax that they don't pay in adjusting their pricing. That's correct: the oil pipeline companies that don't pay a corporate income tax can include the tax that is not levied on them as a "reasonable cost" in pumping up their invoice pricing.

MARK KARLIN, EDITOR OF BUZZFLASH AT TRUTHOUT

2016september1 wallstreetbonuses(Image: Institute for Policy Studies)

The Institute for Policy Studies in Washington, DC released a report yesterday that details how taxpayers are subsidizing banks and massive CEO bonuses. The 34-page "Executive Excess 2016: The Wall Street CEO Bonus Loophole" confirms that Wall Street financial firms and their executives make out like bandits at the expense of everyday taxpaying Americans:

The more U.S. corporations hand out in CEO bonuses, the less they pay in taxes. This is the result of a loophole that allows firms to write off unlimited amounts of executive pay from their federal taxes, as long as it is in the form of so-called "performance-based" compensation.

Wall Street banks [only temporarily] lost this lucrative CEO pay subsidy when they received taxpayer-funded bailouts in the wake of the 2008 crash, but only until they repaid the funds. Many of them rushed to do so, borrowing in the private market in order to escape this and other public bailout-related pay controls. While homeowners and shareholders were still suffering, the banks were free once again to dole out massive bonuses and write off the entire cost, leaving ordinary taxpayers to make up the difference....

After getting out from under the bailout limits on deducting executive pay, the top 20 U.S. banks paid out more than $2 billion in fully deductible performance bonuses to their top five executives between 2012 and 2015. At a 35 percent corporate tax rate, this translates into a taxpayer subsidy worth more than $725 million, or $1.7 million per executive per year. That $725 million could’ve covered the cost of hiring 9,000 elementary school teachers or creating 13,000 infrastructure jobs for a year.

"Taxpayers should not have to subsidize excessive CEO bonuses at any corporation," lead report author Sarah Anderson, director of the institute's Global Economy Project, noted in an email announcing the finding.

MARK KARLIN, EDITOR OF BUZZFLASH AT TRUTHOUT

2016august30 cubaWill a tsunami of capitalism wash over Cuba? (Photo: Balint Földesi)

Today, Jet Blue airlines is flying the first commercial flight in a little over 50 years from the US to Cuba -- from Fort Lauderdale to the Cuban city of Santa Clara. Up until now, an American could only fly to Cuba on a charter flight and meet certain criteria to visit the island. The "requirements" still remain, but they are broad enough that most people in the US can say that one category or another applies to their visits, and the State Department is not expected to seriously enforce the stipulation. As a result, Cuba may be overrun with tourists and businesspeople.

Indeed, as CNN reports, the number of daily flights to Cuba is expected to balloon quickly:

Soon up to a maximum of 110 daily flights operated by such carriers as JetBlue, American Airlines, Delta, Frontier, Southwest and Silver Airways are due to begin flying to the ... island, according to the US Department of Transportation.

This will include service to many Cuban cities. In fact, the most lucrative routes -- to Havana -- have not yet been assigned to airlines by the Department of Transportation. There's no doubt that in a few years, Cuba is going to be hit by a tsunami of consumers and corporate profit seekers. After all, the US has long regarded Mexico, Central America, South America and the Caribbean nations as captive markets. With the conversion of Cuba into a Soviet-aligned nation after Castro's military victory, that country became the lone exception in the hemisphere: a place that was not seen by the US as an extension of its own economic system. Today, the Bolivarian revolution has foundered in Venezuela, and Dilma Rouseff is being impeached in Brazil. Ecuador and Bolivia may put up resistance to US hegemony, but remain deeply entangled in it.

In the CNN article, a recent tourist was concerned that Cuba too may soon be captured by capitalism:

For many Americans, though, the immediate concern is not security but seeing Cuba before the island emerges from the Cold War time warp of the last 50 years.

MARK KARLIN, EDITOR OF BUZZFLASH AT TRUTHOUT

2016august26 bigpharmaBig Pharma is spending millions of dollars trying to defeat a California pro-consumer proposition. (Image:EnvironmentalIllnessNetwork)

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It is hard to grasp the price gouging and unregulated sky-high profiteering of drug companies in the United States, but the rise in the cost of the lifesaving EpiPens -- a drug that can save people from lethal allergic attacks -- certainly offers a searing example. As news accounts have revealed, the pharmaceutical firm Mylan raised the price of the medication by hundreds of dollars after it acquired the injection patent from another firm. There was no increase in production costs, just exorbitant overcharging to achieve extortion-level profits. After all, this is a drug that some people need to live through possible deadly allergic reactions.

As Jordan Weissman of Slate sardonically expressed in an article yesterday, "The CEO who hiked EpiPen prices actually just said, “No one’s more frustrated than me.” Say what? Heather Bresch, the Mylan CEO just quoted, would have us believe that her firm was forced by "the system" to pick the pockets of consumers to purchase a drug without which they could die? Of course, the reality is that Mylan made out like modern day brigands because of greed. The only aspect of the EpiPens scandal that Bresch is likely "frustrated" with is the public relations damage to her company and increased calls to rein in the pricing of Big Pharma. As Weissman quips, "It all almost makes you miss Martin Shkreli; at least he was happy to own his villainy."

Of course, EpiPens is only one medication. As a Truthout article recently detailed, a populist effort to bring pharmaceutical prices down -- at least for those who can least afford costly prescriptions -- is now playing out in California.

MARK KARLIN, BUZZFLASH AT TRUTHOUT

2016august25 remittancesRemittances to Mexico total an estiamated $25 billion and play a key role in the survival of the poor, who comprise more than 45 percent of the population. (Photo: Richard Allaway)

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An August 24 New York Time article reports on how important remittances (money sent home by workers living in other countries) are to the economic stability of nations with high poverty rates:

The millions of migrant workers who drill for oil, deliver pizza or take care of older adults far from home sent nearly $582 billion back to their countries in 2015, according to the World Bank....

....remittances have become crucial to relieving some of the world’s poorest people from hunger and want, just as they have become a major revenue source for a number of fragile nations.

A separate World Bank study found that remittances were the main reason poverty had declined so sharply there in recent years. Not only do families of migrant workers benefit, the study found; so does everybody else, when the families spend that money locally.

 A 2015 Reuters article stated that the Mexican government disclosed:

Two million more Mexicans fell into poverty between 2012 and 2014, government data showed on Thursday, highlighting the challenges President Enrique Pena Nieto faces in meeting pledges to lift millions out of need.

The poverty rate increased by 0.7 percentage point to 46.2 percent last year from 45.5 percent in 2012, equivalent to 55.3 million people in the nation of nearly 120 million, said government social development agency Coneval.

As a result, additional revenue -- such as remittances -- that are sent to Mexico are even more vital for many people's survival. The Mexican economy currently resembles an oligarchy, and dramatic political change in the direction of economic justice does not appear to be on the horizon in the near future. This is due to a variety of factors, including the US's efforts to ensure that Mexico does not engage in real economic reform, which would distract it from becoming a full-fledged member of the neoliberal global economy.

MARK KARLIN, EDITOR OF BUZZFLASH AT TRUTHOUT

2016aug24 trumpaliensPhotoshop of Donald Trump and his friends.  (Photo: IoSonoUnaFotoCamera)

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Oh, how the mainstream corporate media loves to roll out their templated coverage of elections every four years. This "coverage" has everything to do with personality, sports analogies and scripted timelines. And as we've pointed out in recent commentaries for the post-convention summer coverage, the mass media loves to push the candidates toward a so-called "reset" of their campaigns, a few months ahead of the general election. In this scenario, the candidates "pivot" in order to "stay on message," moving toward the mythical "center" of the voting public, which is chockfull of the often-mentioned "independent voters."

These clichéd and lazy journalistic conventions allow reporters to create a political process that is not only ridiculously predictable, but is also a betrayal of any commitment to an exploration of real public policy options.

In short, the mass media is a bit distressed because instead of rewriting articles from campaigns past, they are actually having to try to explain how Trump has managed to go through many short-lived pivots. It must be frustrating to the elite political scribes that Trump appears to be going through a revolving door and ending right back where he started, as a bully, bigoted, authoritarian narcissist.

After all, how could Trump be "pivoting" to the center when his new campaign head is Stephen Bannon, CEO of what is known as the alt-right Breitbart News (until he joined the Trump campaign)? From the beginning, Trump has been in line with the alt-right movement: openly misogynist, Islamophobic, anti-LGBTQ, anti-immigrant and authoritarian.

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