I want to follow-up….

I want to follow-up on my last post dealing with our economic prospects in the coming year, exacerbated by Sequestration, or mandatory across-the-board budget cuts, beginning in January, 2013.

Things to ponder:

Whatever one’s politics, the Obama administration, in its doubtless sincere efforts to stimulate the economy, may have actually done it harm by adding $4 trillion to our national debt, now over a staggering $15 trillion. Nearly a trillion was spent on bailing out the banks, largely responsible for our economic meltdown.

These increases average a trillion dollars per year since this administration has been in office, with little to show for it. In fact, our stagnant economy may well plunge again. Last month’s economic figures, while showing a 180,000 job increase, did not alter the grim unemployment fallout, which remains at 8.2 percent. With more than 5 million unemployed, we have to do much better to make this sorry mess go away.

Certainly, this present recession, perhaps a euphemism, invites comparison with the Great Depression of the 1930s. While the latter was the mother of all depressions, with unemployment reaching a 26% level, making our present crisis seem puny, it does resemble our situation in its stubbornness, despite the Roosevelt’s fervent efforts, to yield results. What most people don’t know is that unemployment had actually increased under Roosevelt when he ran for reelection in 1936. It would take a world war to purge our economic woes.

I must confess I don’t think anyone has a definitive solution to what ails us, despite the heated rhetoric in an election year. Simple answers won’t do more than sugar coat a complex problem.

What’s more, our fate in a global economy isn’t entirely within our hands.

What if Israel attacks Iran?

Or if the economic malaise in Europe has no bottom and nations like Greece, Italy, Spain and Portugal default? Like the tsunami debris from Japan now washing-up on our West coast shores, we can’t escape the tidal impact of a European collapse resulting in reduced imports of American goods.

Back to our own shores again, if automatic cuts affecting defense go into effect next year it’s estimated that a million jobs will be lost. That’s more than all the projected jobs created in the American economy this year!

It seems a given that without confidence in the private sector, which is our primary catalyst for job creation, we’re doomed to a tortoise pace in achieving remedy.

And there are yet other mitigating factors that may compromise economic recovery. Although the health care reform measure has several desirable features, it may be the wrong time for it in a down economy. A recent survey indicates many employers anticipate costs increases with its implementation, so add this to the mix. If I were an employer, I’d certainly opt for caution when it comes to hiring or expanding inventory.

To be sure, economics has rightly been called “the dismal science,” except I’d underscore “dismal,” and eliminate “science,” since that implies probability corroborated by empirical data. Again, no one has the definitive answer, so be wary of snake oil formulas in this election year.

It’s all like some devastating disease that, despite our best efforts, defies our remedies. Much as we’d like, there’s no quick fix.

rj

A day of financial reckoning will soon come….

A day of financial reckoning will soon come to America, resulting in a substantial redistribution of income and entitlement payouts. It will see its genesis early in 2013, or shortly after this fall’s election.

We’ve already witnessed the opening skirmish of this inevitable transition to a more restricted access to America’s economic pie, beginning with the recommendations of the Congressional appointed Joint Selection Committee on Deficit Reduction, more commonly known as the “Super Committee”. The Committee, however, failed in its mandate to reduce the federal deficit by 1.5 trillion over the next decade, triggering automatic cuts (sequestration) to the tune of 1.2 trillion to be divided between Defense and other programs. Partisan politics had intervened, denting courage, and the chasm between Democrats and Republicans couldn’t be bridged.

The truth is that the economic meltdown we see in Europe is theater for what’s coming here. Thus far we’ve been able to either borrow or print money to shore up our stagnant economy. We’ve even cut taxes.

We’ve become like irresponsible credit card users, postponing tomorrow’s reckoning, to meet insatiable wants. Ultimately, we’ll have to pay our bills or close up shop. Presently, our national deb stands at a staggering $15 trillion and we pay $200 billion interest on that debt annually.

In January, the cuts will go into effect. When you take defense and entitlement programs into consideration, you’ve only got $600 billion left in the kitty to spend elsewhere.

Do we really want to cut our defense budget in an unsafe world or Social Security, Medicare, and Medicaid?

The social and political ramifications promise to be enormous and tax revenues will need to be raised. Ultimately, the poor and low wage earner will be sheltered, and while the rich will see higher taxes, the declining middle class will continue to bear the brunt.

Actually, things have been eroding for several decades. As a serviceman, I was once guaranteed health benefits. Today, a sliding wage scale applies, ruling out the middle class.

Each year, a retiree’s costs for Medicare increases, ultimately compromising monthly Social Security checks.

As for Social Security, after payroll deductions for over forty years, I pay out several hundred dollars in taxes on the rather paltry sum I receive.

And more is coming. Social Security outlays will be reconfigured. Age eligibility for full benefits will advance to 67.

You will pay more for Medicare while getting less coverage.

Let’s take some specific examples of the potential fallout for education, based upon current sequestration projections by the Congressional Budget Office (CPO):

ESEA Title I,Part A):: Funding cut: $17,958,000 affecting 27,660,000 students. Potential job losses: 280,000.

Special Education Grants to States (IDEA-B-611): $14,316,000 affecting 5,900,000 students. Potential layoffs: 230,000.

Head Start (HSA, section 639): $9,841,000 affecting 1,340,000 students. Potential job losses: 440,000.

Even for the financially marginalized, the slice of the pie is getting smaller, particularly at the state level, where budgets have imitated the faulty federal model, forcing cuts in Medicaid and welfare outlays.

At the state level, too, an ominous trend has begun of cities declaring bankruptcy, three in California this year alone. Much of this comes from budgets overburdened with generous retirement obligations to public workers.

The times are a-changing and we may find ourselves entering into an era of social rancor not seen since the Vietnam debacle. The battle will spill over into the streets,
and all, all will be utterly changed. It all comes down to who will pay and how much. (Most people think it’s ok for the neighbor to pay more, but not themselves.)

The great challenge is mustering cuts without dampening the economy. That’s been what’s gone wrong in Europe: austerity without stimulus.

Yet like your credit card balance, the bills will have to be paid.

The Obama administration prides itself…

The Obama administration prides itself on having saved Detroit’s auto industry with its proviso of bailout money.  Of course, this wasn’t the case for prosperous Ford Motor company, which enjoyed substantial profits despite the downturn in the economy with the onset of the 2008 recession.  Clearly, the demise of Chrysler and GM had its source elsewhere, or in mismanagement.  While GM and Chrysler have largely repaid the government, the fact remains that such bailouts have resulted in a trillion dollars of new debt.  Sooner or later, we will have to pay the piper as we approach the Eurozone’s  present dilemma.  
Both Republicans and Democrats have made matters worse by approving the Obama sponsored payroll tax cut, resulting in a diversion of 2% from Social Security funding, a vital program already in serious trouble.  Republicans have further contributed to our economic malaise by holding out for no new income tax revenues.  What is needed is a balance of stimulus money in programs that can work along with cuts in pork barrel spending and a provision for adequate tax revenue to pay for programs that do matter.  Germany is today’s model in this regard, to the envy of its neighbors.  
Ironically, Obama’s economic policies with their lavish spending, exacerbated by Republican intransigence on new tax revenue, threaten all of us.  Unfortunately, this administration seems bent on rewarding incompetence, and frequently, even with regard to malfeasance on the part of banks, the auto industry, and even home owners.
I strongly believe that government does better when it encourages the private sector, reducing deficit spending, limiting tax subsidies, reforming tax laws to broaden the tax base, etc.
To our peril, in our rush to ever increasing Federal encroachment on the private sector, we have retreated from those principles set in motion by the founding fathers, rewarding diligence and industry, that has distinguished the American experiment from Europe’s welfare state and propelled its prosperity.  
I would offer one final caution:  implementing new tax revenue without corresponding spending discipline only encourages government to spend even more.
What I have written is encapsulated in Benjamin Franklin’s observation on the new American republic:  “The expense of our civil government we have always borne, and can easily bear, because it is small.  A virtuous and laborious people may be cheaply governed” (Letter to William Strahan, February 16, 1784).

A view from the precipice: the American economy

In the last several weeks we’ve seen signs, small, yet significant because of their consistency, of an upturn in the American economy, with unemployment dropping to 8.6% after spiking to 9.9% in April, 2010. Nonetheless, we’re still facing a bumpy ride and it may take another three years to right ourselves in even the best scenario. Just yesterday, Boeing announced it will close its plant in Wichita in 2013, resulting in the loss of 2160 jobs. Boeing faults upcoming defense cuts.

This is a case in point. On the one hand, there is a need to stimulate the economy; on the other, a need to cut spending. As I see it, the priority should be on getting people back to work and preserving the jobs that remain. Yet I see the President will announce today a $500 billion reduction in defense spending. The fallout in job losses is incalculable, and I’m puzzled as to how this squares with his near daily appearances in several states, giving pep talks on what he’s done and wants to do to create jobs. The one hand gives, and the other hand takes away.

Here are some sobering facts you’re not getting from the Washington power-brokers:

As of July, 2011, only 63% of men were working.

Unemployment stood at 7.6% when Obama took office. Three years later, it hovers just below 9%. If you’re Black or Spanish, the numbers are staggering.

In the 1950s, manufacturing was 28% of our GEP. By 2010, it had dropped to 11.7%. In contrast, it stands at 25% in China. So much for free trade!

Forty percent of our jobs are low-paying, compared with 30% in the 1980s.

Median household income has fallen three years in a row.

Student loan indebtedness has soared to an average $25000 on graduation.

Consumer debt is rising again, as Americans turn to their credit cards to make ends meet.

The federal government now has ownership of more than 250,000 foreclosed homes.

Millions of Americans currently pay mortgages on homes no longer worth their purchase price.

The total debt of Fannie May, Freddie Mack, and Sallie Mae now stands at 6.4 trillion. It was 3.1 trillion in 2008.

Fifty million Americans lack health insurance. Meanwhile, companies are continuing to drop health care coverage for their employees or asking them to pay more.

Poverty is growing in the U. S., with one in five Americans now dirt poor, the highest figure since 1959 when the government began calculating poverty.

I haven’t ventured into state indebtedness, a whole subject in itself. Most of the states are in hock for millions, if not billions, especially in funding pensions for their public employees. In virtually all the states, costs are being passed on to cities and counties. Meanwhile, infrastructure, education, safety, health and environment are being compromised with spending reductions. Some states are selling off assets like tollways to foreign investors.

While all this is going on, Sears is closing, yet again, a number of its stores, Barnes and Noble just announced a steep drop in profits, and Bank of America will eliminate 600 branch banks.

Add to this the danger of a Europe meltdown: Greece, Ireland, Spain, Portugal, Italy going into default. Our economies are interlocked in today’s global village. Should it happen, it means an even deeper recession.

Meanwhile our politicians seem more interested in power than solutions. Worse, they have been lying to us. Maybe they need to join the unemployed.

On the dividends of a late read

I read a lot, eagerly, omnivorously, and in doing so sometimes overreach, ordering books I can’t possibly get to in the short term; hence they accumulate in heaps on my office floor, as my shelves are already squeezed. I confess my gluttony, yet without repentance. Liking books isn’t a bad vice, I think, and I’ll hardly bankrupt our family budget in doing so.

Sometimes, however, I’ll guiltily raid one of my piles, snatching a book that’s lain there goodness knows how long, with the end result that it’s somewhat dated in what it has to say. Take, for instance, my latest snatch, Bill Bryson’s I’m a Stranger Here Myself: Notes on Returning to America After Twenty Years Away. Well, here’s a book that came out in 1999, or 12-years ago, and I’m reading it just now. I deserve what I get.

But sometimes there are dividends in doing a late read, as time’s passage can afford a new perspective. For example, Bryson, in a chapter called, “The Numbers Game,” has this paragraph, mind you, written pre-1999:

No matter where you turn with regard to America and its economy you are going to bump into figures that are so large as to be beyond meaningful comprehension. Consider just a few figures culled at random from this week’s papers. California has an economy worth $850 billion. The annual gross domestic product of the United States is $6.8 trillion. The federal budget is $12.6 trillion, the federal deficit near $200 billion (p. 51).

Well, let’s see what time’s warp has done to those stats.

Today, the worth of California’s economy has swelled to $2 trillion.

The USA annual gross domestic product (GDP) is now over $15 trillion.

The approved federal budget for 2011 is currently at $3,360 trillion. http://en.wikipedia.org/wiki/2011_United_States_federal_budget#Total_spending
Wikipedia

As I write, the federal deficit exceeds $15 trillion. http://www.federalbudget.com/FederalBudget. The figures increase every second. Remember, it was just $200 billion when Bryson wrote his book 12-years earlier!

I don’t know about you, but I find this sobering, if not downright scary. We’ve gone from a budget mess to the very precipice. Ironically, the bailouts and stimuli to the economy, rather than helping us, are contributing to our economic malaise, turning the United States into a full scale deficit crisis. Somewhere, we’ve got to stop the fiscal hemorrhaging. Ok, my figures update Bryson’s 12-years ago. What’s going to happen over the next ten years? I don’t think any of us want to go there!

For a sense of just how much money is dripping away into interest payments on accumulated debt exceeding $15 trillion we can’t do better than Bryson’s fantasy analogy of earning one buck for each dollar you could initial to determine how long it would take you to earn just a trillion dollars:

If you initialed one dollar per second, you would make $1000 every seventeen minutes. After 12 days of nonstop effort you would acquire your first $1 million. Thus, it would take you 120 days to accumulate $10 million and 1,200 days–something over three years–to reach $100 million. After 31.7 years, you would be as wealthy as Bill Gates. But not until after 31,709.8 years would you count your trillionth dollar (and even then you would be less than one-fourth of the way through the pile of money representing America’s national debt). That is what $1 trillion is (p. 52).

As I’ve said, sometimes it’s serendipity to read a book later rather than sooner. Unfortunately, not many in the right places seem to be reading–or listening–at all. I think of other problems experiencing the “kick-the-can-down the road” syndrome,” for example, accelerating climate change, a nuclear Iran, a world with insufficient water, population overload.

An ounce of prevention is worth a pound of cure.

How banks war on you and me

According to Wikipedia, “Bank robbery is the crime of stealing from a bank during opening hours.” Let me try a new definition: “Robbery is theft from the people during opening and closing hours.” Yes, banks are quite capable of committing crimes, and often do, as bullies motivated by greed. Banks, in case you missed it, were the primary culprits in fomenting our economic downturn in 2008, the worst America has faced since the Great Depression and likely to continue for several years. In the process, they’ve been able to pull off nearly a trillion dollars in bail out money to cover their profligate scheming and spending, passing their debts on to the citizenry; another two trillion has been spent in trying to re-right the economy. What is more, along with behemoth corporations, banks are kingpins in a concerted effort to dismantle government regulation, giving them a freer hand in accumulating profit.

The banking sector is grateful for our help, screwing us at every turn in efforts to extract still more from the masses they’ve victimized, moving with alacrity in foreclosing on money that shouldn’t have been loaned, often for houses no longer worth their original loan amounts, and doing so without properly reviewing delinquent mortgages (i.e., robo signings). With regard to bank issued credit cards, despite government efforts to safeguard consumers from excessive interest escalation, the banks have found other ways to accumulate capital, imposing charges, for example, on using tellers rather than ATMs and fees on checking accounts below a designated amount. Take Bank of America, for example. It had originally opted to charge debit card users $5 monthly. Public outrage, however, curtailed its implementation. Look for the banks to move more quietly to introduce other charges. You name it, they’ve got a gimmick, proving it’s easier to catch a greased pig than a banker in his Mercedes.

Although our government rightly views consumer spending as a key catalyst to stimulating the economy, banks have made it difficult for many to borrow money, especially for mortgage loans, requiring up to 20% down payment. Obviously, this leaves out many young people and middle class wage earners. Home construction, along with the auto and aircraft industry, is a key component of the American economy. Currently, banks are sitting on a mound of money while looking for better investment returns elsewhere. You and I don’t figure into the equation.

Make no mistake about it: both Wall Street and the banks created the bubbles that got us here, resulting in millions without work and depleted federal and state coffers. It’s gotten so bad that many cash-strapped states are now resorting to selling off their infrastructure such as highways to raise revenue and avoid upkeep outlays. Ultimately this represents an impetus yet again in the dismantling of government, transferring the people’s assets to the private domain. It’s among a speculator’s greatest dreams, and don’t think for a moment that Wall Street and the banks don’t have their eyes on it.

Bank manipulation, or fraud, isn’t anything new. Take for instance, the banking scandals of the 1980s involving many savings and loan institutions. Insiders would falsify the books, making a failing bank appear healthy. Ultimately, the failing bank burdened the federal treasury with making good on consumer deposits up to $100,000 under USFDC guarantees. That means you and I paid the bill for their malfeasance. Hey! Sounds a lot like those recent bailouts. It continues to be difficult, however, for the courts to prosecute since the statutes require proof of intent to deceive.

Fortunately, we have a few watchdogs looking out for our interests, though scarcely enough, given the systemic problem of banking kleptomaniacs. Last week, Massachusetts Attorney General Martha Coakley sued five of the nation’s largest banks, alleging illegal foreclosures and deceptive mortgage servicing.

This suit seeks accountability against the banks for both cutting corners and also rushing to foreclose on homeowners without following the rule of law. There is no question that the deceptive and unlawful behavior by Wall Street and the large banks played a central role in causing this economic crisis. We believe they are not too big to have to obey the law.

The suit names Well Fargo, Bank of America, J. P. Morgan Chase, Citigroup, and GMAC.

The Tea Party has it all wrong. We don’t need less government. We need more.

Only the rich get to see Europe

I had promised my sister-in-law, ailing in Germany, that my wife and I would be visiting her next June. That may not be possible.

I couldn’t believe my eyes when I checked into Orbitz this morning and discovered the cheapest fare was $902 with United/Continental. Wait! It gets better. That’s just the airfare. Add taxes, $617.19, and you’re looking at $1,519.19 per person. In other words, the taxes are two thirds the actual fare. I think that’s outrageous.

I decided to find out why the high taxes. It’s the EU countries that are doing this. Scrapped for cash to finance their deficit welfare-state budgets, they’re looking everywhere. Tourists don’t vote. Voila! Well, and I think I’m not alone, I’ll vote with my feet.

Have they no clue they’re busting their own economies? No more flotillas of Americans and Canadians. Already, you can hear the screams of the European travel industry, not to mention airlines. So far, to no avail.

It’s amazing. I can book a trip from Lexington, KY, all the way to gorgeous Hawaii for just 754 rt, taxes included.

What a mess Europe’s gotten itself into. For decades since WWII, they’ve pretty much thought they had a free lunch, given their generous government outlays. Did they really think Disney World would go on forever? As is, they’ve got this heavy value added tax on virtually everything you buy, their touted free medical care is escalating in cost, and all of this while cutting their defense spending, already meager, by 50% in some countries. What a milk toast ally!

They don’t work as hard as Americans. Most retire 30 years and out. Vacations average 6 weeks, versus two for Americans, many of them not taking any vacation.

What’s awful is that their sorry mess could plunge all of us on this side of the pond into recession again. But what do you do about people who riot in the streets whenever austerity measures are adopted?

And there’s a warning in all of this for America to get its own financial house in order to avoid becoming a version of Greece, Italy, Portugal, Spain, and Ireland. My own state of Ky is nearly 8 billion dollars delinquent in funding pensions for its public employees, including teachers.

Republicans, cutting spending without revenue increases through higher taxation won’t get the job done.

Democrats, increasing taxes without meaningful cuts in spending only delays our day of reckoning.

Better book that trip to Hawaii–don’t I wish–before Congress fancies imitating our European brethren and we all go down the tubes.

Do the wealthy pay their fair share in taxes?

I was rummaging through the local county paper yesterday, sent to me free as a subscription  enticement, when I came across a guest editorial arguing that the “wealthy deserve to keep more than a hunk of their profits.”  This, of course, goes against the grain for the Obama folks and the occupy movement, who feel that the 1.1 percent, as they put it, isn’t paying its fair share in taxes.
 
The columnist argued that the IRS’ own figures show that the top 10 percent actually paid $721 billion of  the more than $1 trillion the government collected in federal income taxes in 2008.  In short, the rich really do pay taxes, or about two dollars out of every three collected. More than $392 billion of this came from the top 1 percent.  In fact, just 0.2 percent of the population pays 21 percent of the taxes.  As for the rest of us, some 47 percent pay no tax, while collecting many social benefits.
 
Do the poor pay taxes?
 
Is there any truth to the writer’s claim?  If you’re talking about federal taxes, the answer is, yes.  But this doesn’t get to the bottom line.  Virtually everybody pays taxes.  For example, there’s the payroll tax of 6.1 percent on the initial $106, 800 of wages (temporally reduced) for Social Security and 1.45 percent on all wages for Medicare. Then there are state and local taxes, e. g., sales, income, property, gasoline, utilities, etc.  Everybody, including the poor, the disabled, and the retired pays taxes.  According to the Tax Foundation, the 2008 earnings average for the bottom 50 percent, was just $15,300.  In short, these wage earners didn’t earn enough to pay federal taxes, though they paid other taxes at the same tax rates.  Broken down proportionally,  the poor pay more per capita than the rich, with the one exception of Vermont.  At this point, I’d urge everybody to read Barbara Ehrenreich’s monumental expose,  Nickel and Dimed: On (not) Getting By in America.
 
Do the rich pay their fair share?
 
Initially it would appear they do.  One percent of  the top wage earners paid 38% of  the total income tax in 2008, the last year figures were available (published at the IRS online site).  Left out is the fact that federal tax revenues aren’t solely collected from income taxes.  Payroll taxes for Social Security, Medicare, and even unemployment insurance, are paid by the bottom 90 percent of taxpayers.  This is because the payroll tax for Social Security is restricted to a maximum $106,800, after which there’s no tax.  Bill Gates and Steve Forbes pay the same amount as you and I.  Although they’re subject to paying a means tax on their social security income when they retire, so are you and I.  Don’t even get me started!
 
Is there a growing tax gap between the top 10 percent and the bottom 90 percent?
 
Yes!  When Reagan took office in 1980, the marginal tax rate (the tax rate paid on the top earned income)  stood at 70%.  By 1987, he reduced it to 50 percent  Under George Bush, the rate was reduced to 35 percent.  Since 1980, the average income of the bottom 90%, adjusted for inflation, has increased to $303, or 1 percent.  In the meantime, the 1 percent did a considerably better, doubling their income to $1.1 million.
 
And how goes it for the corporate sector?
 

According to IRS figures, 2008, corporate profits rose 12 percent since 2000, even though corporate taxes show an 8 percent decline.  This discrepancy is occurring  because of increasing loopholes or transferring of profits to offshore hideaways such as the Cayman Islands.  Currently, corporations have stashed an estimated 2 trillion in cash holdings, unwilling to reinvest in a volatile economy.  I’m not saying this is wrong in itself.  The spending of the average American family is down as well and for the same reasons.  Spending is the key catalyst to market regeneration. 
The point is, many of the banks were bailed out in 2008 to a tune of nearly a trillion.  They seem to have a short memory, and it hasn’t decreased either their zeal to close on beleaguered mortgages or award themselves bonuses in the millions while enjoying unparalleled tax breaks.  At the moment, bonus outlays exceed pre-recession levels, this in a down economy that has produced incalculable suffering for many Americans unable to afford their homes, buy health care, or find meaningful work.  JP Morgan’s CEO Jamie Dimon recently took home a $19 million dollar bonus, enough to keep food on the table.  While not all CEOs receive this kind of payout, the vast majority of CEOs continue to enjoy perks with the consent of their shareholders.  Forbes reports that investors at only 36 companies out of 2250 voted against pay increases for their CEOs.  Meanwhile, new data shows that nearly 25% of us now lives in poverty. 
Have the occupiers got it wrong?  Not by a long shot!

Daryl Hannah and the sustainable life

Hollywood has its heroes in real life and not just on the screen. I think of celebrities who’ve used their fame and wealth to help others: Brad Pitt and Angelina Jolie, for example, founders of the Jolie-Pitt Foundation, dedicated to addressing rural poverty, the protection of natural resources, and wildlife conservation. Recently they donated $1 million to Doctors Without Borders.

And then there are those actors, 700 plus, active in promoting human rights, people like George Clooney, Ben Afleck, Matt Damon, Natalie Portman, Susan Sarandon and, of course, Brad and Angelina.

The animals aren’t left out either, with more than 100 actors devoting time and money to supporting PETA; among them, Alec Baldwin, Alicia Silverstone, Gillian Anderson, Keanu Reeves, Casey Affleck, Ricky Gervais, Kim Basinger, Paul McCartney, and Pam Anderson. Ellen Degeneres and Denzel Washington are among those supporting Farm Sanctuary.

Perhaps lesser known is Daryl Hannah, passionately committed to charity endeavor and social activism. I came upon her recently in reading her interview with S. Alison Charbonais, editor of Natural Awakenings. You probably saw her in Blade Runner, Steel Magnolias, or Crimes and Misdemeanors.

When not making a film, speaking, or traveling, she lives in this awesome, totally green house, salvaged from an old barn that was to be torn down for a new post office in her small Rocky Mountain community. She relocated the barn, berming it into a hillside offering maximum solar exposure. An ardent vegan, she keeps a garden for growing veggies on a property fed by a spring. With solar power, passive and active, she lives completely “off the grid.” Now here’s an environmentalist I can respect, modeling what she professes, unlike, say, Al Gore, with his five houses, one of them 12000 square feet, and all of them heavily dependent on public utilities.

In contrast, Hannah believes in simplicity, measuring out each action by its consequence: “The more I learn, the more I try to adapt to and adopt a simpler lifestyle.”

Co-founder of the U. S. Sustainable Biodiesel Alliance to help people distinguish between good and bad biodiesel fuels, she drives a car converted to run on alcohol only.

What I especially like is how she touches all the bases, including the emerging population crisis complicating the challenges of global warming. Exponential population has struck me as the forgotten issue, even among environmental organizations such as the Sierra Club, Greenpeace, and Natural Resources Defense Council, perhaps for political reasons:

I’m very concerned that global population has grown from about 3 billion people when I was born to nearly 7 billion now; we are also witnessing mass extinction of species worldwide; there are more enslaved human beings today than at any other time in human history.

Hannah has been arrested three times, on one occasion spending jail time, for protesting environmental degradation. Her most recent arrest occurred last August during a sit-in outside the White House, protesting the Keystone Project that calls for creating an oil pipeline from Canada to the Gulf coast.

Hannah has this really nifty website, modelling simplicity in its very design LoveLife that offers helpful green solutions.

Daryl Hannah is a femme extraordinaire!

–rj

Business as usual

And so, what else is new? My previous post touched on the Occupy Wall Street phenomenon, the people’s revolt against the wealthy and corporate interests, who don’t pay their fair share in taxes, yet harvest bundles in a listing economy even as millions suffer and others wait for the shoe to drop.

Currently, corporate cash holdings are at an all time high. Did you know, for example, that corporations comprising Standard & Poor’s 500 index have currently stacked up more than $1 trillion in cash and short-term investments?

Now mind you, the figures I gave you don’t even take-in the banks, whom I’ll get to in just a bit.

While our economy hasn’t recovered and there’s the very real possibility of a double-dip recession in your near future, corporations and banks are raking in the bucks. Wall Street jubilantly anticipates per share earnings for stocks in the S&P 500 will reach $100 per share by year’s end; in 2012, slower growth, but $104 per share. True, if the economy dips again–did it ever recover?–we could see these projections tumble. Still, don’t bet against the banks and corps. Like a nimble cat, they tend to land on their feet, come wind or rain.

And so what are the corporations doing with their wealth? Well, they’re doing what you and I would probably do were we in their shoes; namely, shoring up for future contingencies. One thing they’re not doing is hiring workers, given market insecurity. They’re also not desisting from awarding themselves egregious bonuses. Hey, we spent nearly a trillion bailing these guys out. Thanks for the memory!

As for the banks, they’ve proven themselves adept at getting around recent congressional moves to protect consumers by imposing caps on credit cards, overdrafts, and debit card merchant fees. That helps explain the sudden deluge you’re getting in bank mail, announcing new terms for checking accounts, reduced credit card awards, and higher ATM fees. Some banks, like Bank of America, are imposing a monthly charge for deposits or withdrawal using a teller ($8.95 at BOA). Banks like Chase now charge $25 for closing an account within 90 days of opening it. It gets worse at PNC and U. S. Bank, which charge $25 for closing an account within 180 days of opening it.

Want to get your statements in the mail? Think again. BOA again charges $8.95 monthly for the privilege, with other banks now lining up.

You prefer pay-as-you-go, using your debit card. Nice way of keeping your budget tidy and avoiding credit card charges, except that some banks are now charging a $3 fee for the privilege.

The gimmick that galls me above all others, since I was on the recipient list, was learning I’d be charged a monthly fee even if I had a 0 credit card balance. You can be sure I got out of Dodge.

You’d like to buy a home at today’s record interest lows? Fine, if you’ve got the minimal 20% down payment. That eliminates a good many first timers, especially young people.

Want to refinance? Not so fast. What’s your home really worth versus the mortgage presently owed? The banks are going to want to take a close look. And don’t forget the closing costs.

When banks and corporations bleed you and me and refuse to loan or invest in the body politic, they divest in stimulating recovery and should be held accountable.

Watch your step. Corporate and bank IEDs are everywhere.

Hats off to the Occupy movement. I adore you!

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