HorsesAss.Org

The regional manager of the San Francisco Federal Reserve, Craig Nolte, told an audience in Vancouver this week that there’s still trouble in them there ARM’s. From The Columbian:

The high rate of foreclosure has made Clark County No. 1 out of all 39 counties in Washington state in the first quarter of 2009. The problem could get worse before it gets better, given the lax lending standards and high number of adjustable rate mortgages issued during the 2005 home-selling boom, Nolte said.

“It’s not all subprime loans that are the problem. It’s mainly subprimes with ARMs,” he said.

Adjustable rate mortgages made up more than 23 percent of the area’s home lending while Clark County’s housing market was hot. Now those homeowners are overstretched as their mortgage rates adjust, which can raise the average payment by up to $300 a month.

And as Atrios is pointing out this morning, the problem is likely to get worse before it gets better.

Tanta, who is sadly no longer with us, in an old post reminds me to use the correct terminology to describe the problem. Option ARM rates are going to be recasting soon and in increasing numbers. That’s the magic moment when people can no longer make minimum payments, when they can longer make interest-only or neg-amortization payments.

When that magic moment comes, all of those people are going to look at how high their now unaffordable mortgage payments are. Then they’ll look at how much their house is actually worth relative to how much though owe. Then, maybe, they’ll try one of the various initiatives to modify their mortgage terms. And then, quite likely, they’ll jut walk away.

And these re-casts are coming in 2010 and 2011 in big numbers.

The point being, as Atrios succinctly says, is that’s why the failure to put in place cramdowns is so troublesome.

The banksters stopped it, and if nothing is done we’re all going to get to enjoy another round of mortgage-related calamity, presumably with similarly damaging results to the larger economy. So meanwhile idiots can talk about socialism and guns and gays and whatever, but the regular citizenry needs both the financial system and the larger economy to function well.

It’s absolutely fascinating, too, how some bidness guys ‘n gals think this is all just a bump in the road, and that everything will go back to what they thought was normal soon. Thus the silly talk lately here in Clark County from Republican county commissioners about how important it is to re-inflate the bubble to provide jobs, as if the larger systemic problem know colloquially as “big shitpile” doesn’t exist. Who the heck is going to be buying lots of new houses now, when the market is being depressed so badly and there seems to be no end in sight?

Beyond that, neo-liberal economic policy has been an utter and complete disaster. Continuing to pursue it, as the Obama administration and Congress are doing when it comes to the financial sector, is likely to produce the same result. Most regular people who screw up their jobs horribly get fired, but the banksters get our money and get to continue making a mess of things. Awesome.

It’s worth keeping in mind Republicans want the Obama administration to fail, so of course they are going to fight hard for the status quo ante. We still need a change we can believe in on this front, and if it doesn’t happen by the end of the year, things may get very interesting again.

With Vancouver’s Columbian filing for bankruptcy, and many industry observers expecting the same for the The Seattle Times if it too fails to renegotiate its debt, I want to take a moment to distinguish between the poor fundamentals of the newspaper industry as a whole, and the poor business decisions of some of its most troubled publishers.

No doubt this is a difficult time to own and operate a daily newspaper.  The growth of the Internet and changing consumer habits have been undermining the once dominant dailies for more than a decade, but the sudden, recession-induced plunge in advertising revenues has greatly accelerated the process.  Local news monopolies, reliable cash cows for much of the past century, are slashing budgets and staff nationwide as they attempt to weather the current economic storm, while the industry as a whole struggles to invent a sustainable online business model.

Quite frankly, the fundamentals suck, and thus it would be understandable if those at the helm of papers like The Times and The Columbian take some solace in the woes of their fellow publishers.  But not too much.

For while the whole industry is struggling, the financial precariousness of some of our most threatened papers is at least partially due to the awful business decisions of their owners, in particular, the incredibly over-leveraged position they find themselves in as a result of ill-advised acquisitions and other bone-headed ventures.

For The Columbian, it was the construction of a new $40 million office tower that landed a shrunken newsroom back in its old digs, and publisher Scott Campbell in bankruptcy court.  For The Times, it was Frank Blethen’s ill-fated foray into the Maine media market that has left him with a couple hundred million dollars of debt coming due, and no obvious means of raising more capital.  Both papers are currently losing money on their daily operations, but neither would be struggling to survive this particular recession if the bankers weren’t pounding at their doors.

And they’re not alone.  Indeed, while most local papers have remained at least marginally profitable despite the industry-wide turmoil, their corporate parents are being crushed under mountains of debt incurred via highly leveraged acquisitions.  It’s not that most newspapers are losing money—in fact, on average, the industry’s operating margins remain higher than most of its advertisers—it’s that they simply can’t sustain the 20 to 30 percent margins on which many of these deals were predicated.

For all the whining about Google and bloggers and high taxes and changing demographics and the reluctance of consumers to pay for content, it’s not the core business of newspapers that has put so many dailies at death’s door, but rather, the poor business decisions of their owners.

Over the years we’ve heard a lot from the conservative editorial boards at the The Times and The Columbian and elsewhere about the need for folks to take personal responsibility.  It is time they demanded the same of their own publishers.

Last week in TIME Magazine, Maia Szalavitz wrote about Glenn Greenwald’s report on the success of drug decriminalization in Portugal. In the article, she quotes one person skeptical of whether that success can be brought here to the states:

“I think we can learn that we should stop being reflexively opposed when someone else does [decriminalize] and should take seriously the possibility that anti-user enforcement isn’t having much influence on our drug consumption,” says Mark Kleiman, author of the forthcoming When Brute Force Fails: How to Have Less Crime and Less Punishment and director of the drug policy analysis program at UCLA. Kleiman does not consider Portugal a realistic model for the U.S., however, because of differences in size and culture between the two countries.

When a reader at Greenwald’s Salon blog asked him about Kleiman’s thoughts, here was Greenwald’s response [via DWR]:

Mark Kleinman emailed me once about something I wrote and had a major outburst, expressing all sorts of hostility – I’m not saying that motivated him to dismiss the relevance of Portugal, but I am going tow rite and demand specifics.

I find it so shallow and vapid when people say: “We can’t look to what happened in that country because there are cultural differences and size differences” without being specific — why would drug decriminalization work with a population of 10 million people but not 300 million? What, specifically, are the meaningful “cultural differences” between Portugal and the U.S. that allows decriminalization to work in the former but not the latter?

In fairness to Kleiman, he was quoted in that article and thus not necessarily able to control what was conveyed, but I am going to demand some specifics from him.

After reading that, I was reminded of an exchange that Kleiman had with several commenters at his site a while back over the same subject. In the comments of this post, a commenter wrote:

Mark, you’ve claimed a few times that European and Canadian successes at various forms of drug “reform” can’t be used as examples for the US, because social conditions are different here. (If I’ve mischaracterized you here, please correct me.)

I’d like to know just what social features of Europe and Canada you believe to be responsible for the success of these programs there, and how you would expect similar programs to fail in the US due to different conditions here.

Kleiman responded with a list of 14 items (his comments don’t have numbers or links, but it was posted at June 21, 2006 04:29 AM, about 1/2 way down the thread). Later on the thread, I picked apart a few of the items. Looking back at the list again and using Portugal as a comparison point, it’s even easier to see that a number of the items are irrelevant (1, 4) or untrue – either outright or as a difference (2, 9, 10, 11, 12, 13). But what’s even more amusing about that list is that almost all of the reasons that he gives (2, 3, 5, 6, 7, 8, 10, 11, 14) are things that are either caused – or greatly exacerbated – by drug prohibition itself. That’s like saying “oh my, our eagerness to wage war and torture people has made the rest of the world really mad at us. I guess we have no choice now but to keep waging more wars and torturing people”. Or to borrow a modern overused office expression – “the beatings will continue until morale improves”.

Of course, when Kleiman wrote that comment, he was addressing cases like Zurich, Amsterdam, and Vancouver, which may have fit his list a little better, but now that he’s thrown out the same exact argument to Greenwald because “Portugal is smaller than the U.S.” and has vague “cultural differences,” it certainly seems like this is a case where the conclusion stays the same while the justifications keep changing.

I’m not going to jump to any conclusions here about Kleiman’s motivations. A lot of people in the drug law reform community scratch their heads as to why Kleiman sometimes makes very eloquent analyses on the failures of drug policy, but then will turn around and lash out at people who simply follow that path to its logical conclusions. Either way, I’m looking forward to Kleiman’s response to Greenwald, but not holding my breath.

I think it’s fair to say that this casts even more doubt on the legitimacy of Sen. Joe Lieberman, I-Conn.

The campaign of Sen. Joe Lieberman, I/D-Conn., agreed to pay a $50,000 civil penalty after the Federal Election Commission concluded that the campaign repeatedly flouted the law in disbursing cash payments to volunteers during Lieberman’s bruising Democratic primary against businessman Ned Lamont in 2006.

The FEC opened an investigation in late 2006 after Lamont’s campaign lodged a complaint alleging that Lieberman was using a “slush fund” to fuel his campaign in the waning days of the primary. Lamont’s campaign cited more than $387,000 in unexplained expenditures listed only as “petty cash.”

So the next time you hear a Republican complaining about ACORN or something, realize that the actual shenanigans come from ethically corrupt corporate mouthpieces like Joe Lieberman, who at the time was rewarded with fawning traditional media coverage about how “moderate” he is.

Think about it. Joe Lieberman basically has no moral right to serve in the U.S. Senate and it should be Ned Lamont’s seat. But under our system of enforcement, cheaters prosper. Hell, under our system of everything cheaters prosper.

I’d call that downright…uncivil. And everyone in the country gets to pay for this miscarriage of the will of the voters, because you know—you know–Lieberman will continue to do great harm. It’s really not hard to imagine him trying to derail an Obama Supreme Court nominee, because Lieberman is that venal.

Why is being a political prostitute always synonymous with some abstract and non-existent notion of virtuous centrism in this country? It’s a bizarre fairy tale.

Lieberman is the worst of the worst, and the Senate should censure him and strip him of his committee assignments. Yeah, he’ll go over to the Republicans, but he basically already is a Republican, and there is no filibuster-proof group of 60 in reality anyway. The people are sick and tired of their will being subverted by arrogant, corrupt blowhards. The most exclusive club in the world needs to start cleaning up its own house, and a good place to start is with Lieberman.

No, I’m not holding my breath.

(Props to Firedoglake.)

Not unexpected. Bank of America wants its money.

The Columbian’s difficulties began almost as soon as it moved into a new six-story $40 million office building at 415 W. Sixth St. in downtown Vancouver in January 2008. A sour economy and costs related to the building – where newspaper, advertising, circulation and newsroom operations occupied four floors – triggered three rounds of company-wide layoffs last year that cut more than 100 positions from operations. In December, the newspaper was forced to relocate to its former address at 701 W. Eighth St., where it had operated since the 1950s.

The newspaper is promising to continue operations, though.

Publisher Scott Campbell told The Oregonian that his firms, which include not just the newspaper but a real estate development company, might give the fairly empty new building to Bank of America.

Hard to fathom, Bank of America owning a distressed property.

To those fondly speculating about Gov. Chris Gregoire being on the list of potential nominees to replace retiring US Supreme Court Justice David Souter, I offer two words of caution:  Brad Owen.

[youtube]http://www.youtube.com/watch?v=YqBVCr_nudY[/youtube]

Well, you gotta give Mike Brown credit for being consistent:

Here’s what I really think is going on. I think they want to raise this level because that gives them more attention, it gives them more, you know, more legitimacy, and allows them to get out there and say ‘oh look at us, we’re in control we’ve got this thing taken care of.’

Of course, in providing his “expert” analysis to FOX News, it’s no surprise that Brownie focuses on appearances rather than on the public health response or, you know, the flu virus itself, for if there’s anything he learned from his years at the helm of FEMA, it’s that the most important part of mounting an effective emergency management effort is presenting the appearance of mounting an effective emergency management effort.  Or at least that’s the way he ran his agency, always assuring an ample supply of FEMA emblazoned tee-shirts and windbreakers at the scene of any major disaster, even if potable water and adequate shelter were lacking.

Indeed, even in his post-Katrina congressional testimony, Brownie made clear that the real disaster in New Orleans didn’t take place until after his press office was overwhelmed with inquiries about his thin resume:

While FEMA was trying to respond to probably the largest natural disaster in the history of this country, a catastrophic disaster that the president has described covering an area the size of Great Britain – I have heard 90,000 square miles – unless you have been there and seen it, you don’t realize exactly how bad and how big it was – but in the middle of trying to respond to that, FEMA’s press office became bombarded with requests to respond immediately to false statements about my resume and my background.

Ironically, it started with an organization called horsesass.org, that on some blog published a false, and, frankly, in my opinion, defamatory statement that the media just continued to repeat over and over. Next, one national magazine not only defamed me, but my alma mater, the Oklahoma City University School of Law, in one sentence alone leveling six false charges.

[snip]

But I guess it’s the media’s job. But I don’t like it. I think it’s false. It came at the wrong time. And I think it led potentially to me being pulled out of Louisiana because it made me somewhat ineffective.

The unnecessary deaths and suffering in Katrina’s wake?  My fault. Because my reporting ultimately made it impossible for Brownie’s press office to do its job.

Small wonder then that a man who views PR flacks as first responders would choose to criticize US and WHO health officials for their public posturing, while failing to engage in even a cursory discussion of the public health crisis itself.  But by accusing officials of “crying the sky is falling,” FOX’s “expert” shows he has even less expertise about pandemic flu than he did about Atlantic hurricanes; indeed, contrary to Brown’s assertions, it’s not the fatality rate per se that has triggered heightened alert levels as much as it is the apparent contagiousness of this novel virus.  For even if the severity of the symptoms prove no worse than those of the typical seasonal flu, a pandemic outbreak will kill many, many more people, if only through the sheer number of those afflicted:

Because there is no natural immunity to this virus, even though clinically it appears to be like garden variety flu to the individual, with respect to the population it has the potential to spread faster and many more people sick than seasonal flu. And remember, seasonal flu is not a walk in the park. It kills an estimated 30,000 people a year.

A bad flu season can fill hospital emergency rooms and in patient beds to the bursting point. We currently have fewer staffed hospital beds per capita than we did in the last pandemic, 1968 (the “Hong Kong flu”). There is no reserve capacity. We can’t just add physical beds. Beds don’t take care of patients. Nurses and doctors do.

Now take a bad flu season and double it. To each individual it’s the same disease but now everybody is getting it at once, in every community and all over the world. In terms of virulence, it’s a mild pandemic. It’s not a lethal virus like 1918. But in terms of social disruption it could be very bad. If twice as many people get sick, the number of deaths could be 80,000 in the US instead of 40,000.

And if three or four times as many people fall ill, well, do the math.  The 1918 pandemic is estimated to have infected one third of the world population; even at a mortality rate of less than one tenth of one percent, a mild yet similarly widespread pandemic would kill over two million people worldwide.

So are public health officials playing the role of Chicken Little?  Hardly. No, unlike FEMA during Brownie’s tenure, they’re focusing on adequately preparing for the worst, ahead of the crisis, rather than just spinning the response afterwards.

Woke up this morning to find Publicola’s posts not loading, from either the website or the admin screen, and after about 10 minutes of investigation discovered that one of its database tables had become "corrupt."  So I held my breath, closed my eyes, and clicked on the phpMyAdmin "repair" button and… all better!

My first corrupted database in five years of using WordPress.  Who knew that Publicola could be such a corrupting influence?

Joe Turner at Political Buzz posted an email from state Rep. Deb Wallace, D-Vancouver, stating her concerns that Washington will be cutting 40,000 people from the state health care rolls just as the H1N1 flu hits. Wallace seems to be asking fellow Legislators to think about doing something (like further cutting state worker hours) about it in the upcoming special session. You can read it here.

Yeah, I don’t know. Obviously waiting to see how this outbreak actually goes is problematic, because by then it’s too late. I don’t suppose anyone would support a high-earners swine flu tax?

Parents and their employers better be prepared for an indefinite shutdown of the Seattle Public Schools, because that’s what the district is preparing for, one district insider warned me.  And if Seattle shuts its schools, the surrounding districts won’t be far behind.

The quick and sudden closure of Madrona K-8 in response to a single probable case of swine flu should be viewed as a sign that school officials are taking this potential pandemic very seriously.  While officials initially plan to evaluate closures on a school by school basis, preparations are in place to shut the entire district if cases become more widespread, following the lead of Fort Worth TX, which today became the nation’s first major school district to shutter its doors in response to the flu outbreak.

I’m not saying it’s necessarily gonna happen, just that there might not be a lot of warning if it does.

UPDATE:
Seattle Public Schools announced this afternoon that Aki Kurose Middle School and Stevens Elementary will be closed through May 7, due to reported cases of swine flu.

When 5,000 teabaggers rallied in Olympia, the Seattle Times editorial board warned legislators against even thinking about talking about thinking about raising taxes in the face of such a populist uprising.  But with 5,000 marchers expected to hit downtown streets this Friday in support of immigration reform, what is the Times’ editors’ biggest concern?

“May Day march set for rush hour.”

Oh no… the protesters might disrupt the afternoon commute!

(Hat-tip WSLC Reports.)

Portland, always the little brother to Seattle.

Oregon’s first probable case of swine flu has been detected in a Multnomah county woman and another three specimens under review by the state public health lab could be counted as swine flu cases by the end of the day, officials said this morning.

The woman identified as a probable case was not hospitalized and is now recovering, public health officials said.

My only observation is that public health officials are now (correctly) looking intensely for the H1N1 influenza virus, meaning in theory there could have been some cases earlier that we didn’t know about.

It’s very anecdotal, but our family knows an otherwise healthy teenager who became mysteriously ill with flu-like symptoms and was hospitalized after traveling to the desert southwest over spring break, which ended April 5 or so. Happily, the teen recovered after spending a few days being re-hydrated, but it makes you wonder if this thing was already out there and we didn’t know it quite yet. As I said, it proves nothing, but as reporting increases we might want to keep in mind increases in cases will be partly because people are now looking for H1N1. Or so it seems.

Otherwise, feel free to panic if that’s your thing. Bad flu sucks, of course. Our family had it one Christmas about ten years ago, and it’s the only Christmas of which we have no photos, because we fell ill Christmas morning. We lived on a honey-baked ham until New Years Eve, it was sad. The real nasty flu makes you feel like you are constantly having a severe asthma attack. But we all lived.

While it’s interesting that state Sen. Don Benton, R-Vancouver, missed 157 of 847 votes, including some crucial to Clark County, what’s truly heady and delicious, in a smelly-cheese sort of way, is the comment thread below the Columbian article.

Don Benton’s missed votes are all part of a nefarious liberal media plot to make him look bad!

Sigh.

Summary: On April 29, 2009, in a speech on the House floor, Rep. Virginia Foxx claimed that Matthew Shepard’s death was merely the result of a robbery gone bad. While his killers Aaron McKinney and Russell Henderson did rob him, they also admitted that they were well aware of his sexual orientation and pretended they were gay to lure him away from the bar he was in at the time. The most striking feature of the case, of course, is that during the course of a normal, simple robbery, the victim is not generally beaten, tied to a post, and left for dead.

This may not be the way to re-build brand Republican. Yeah, it’s great to cater to the ever-shrinking GOP base, but everyone else finds such comments repulsive.

Movement conservatism, which was never conservative anyhow but rather a radical, theocratic malignancy allied with corporate interests, has now become the almost exclusive province of crazy and ignorant people.

I know there are still some fine, upstanding, “keep your hands off my stack jack” types out there at the grass roots level, but you’d think it would be clear to old-school Republicans by now that if they don’t manage to do something about the lunatics in their party, the American people are going to continue to reject the GOP.

The marginal tax rate we can all have a nice debate about, unless the debate is blown up ahead of time by crazy people. You can’t debate crazy, you can only hope to keep the crazy people from getting the keys to the car. Seriously, how much further off the rails can the GOP go? I guess we’re finding out, as this sort of thing seems to be happening with increasing frequency.

Public health officials announced tonight that they have identified six probable cases of swine flu in Washington state: three in Seattle, two in Snohomish County and one in Spokane County. Confirmation is expected over the next couple days.

The Seattle cases include an 11-year-old boy who attends Madrona K-8. No doubt attendance will be a tad sparse at the school tomorrow.

King County Executive Ron Sims released the following statement this evening:

We are now in the type of worldwide health situation that King County has spent years planning and preparing for. The probable cases of swine flu here in Washington serve as a reminder to all of us that we are a community of connected individuals, each with a role to play in keeping each other safe.

Our excellent public health doctors and staff, along with regional hospitals and health care providers are using the comprehensive pandemic flu plans we’ve created to respond and limit impacts and spread as much as possible.

The years of planning are just part of the solution though. We must each help limit potential flu impacts by washing our hands, covering our coughs, staying home when we’re sick, and making sure our families have the supplies they need if the situation gets worse.

King County is better prepared than many regions to deal with these flu cases and we will get through this medical challenge, together.

Here that folks?  Wash your hands and cover your damn coughs.