Category: Domestic Policy

Should Legislative Wins Have Dems Feeling Optimistic?

The Daily Escape:

Sunset, Colorado, NM, near Grand Junction, CO – July 2022 photo by David Shield

Robert Hubbell made a list of landmark legislation passed thus far during the Biden presidency so that we’d have it handy over the next few months leading to the mid-terms in November:

  • 03/11/2021 American Rescue Plan Act of 2021, a $1.9 trillion relief bill to address the continued impact of COVID-19 on the economy, public health, state and local governments, individuals, and businesses.
  • 11/15/2021 Infrastructure Investment and Jobs Act, a $1.2 trillion investment in “hard infrastructure” including roads and bridges.
  • 03/29/2022, Emmett Till Anti Lynching Act, 120 years after an anti-lynching bill was first introduced and which failed on nearly 200 prior occasions, Congress passed a bill designating lynching as a hate crime. Only three representatives—one each from Texas, Kentucky, and Georgia—voted against the bill.
  • 06/25/22 Bipartisan Safer Communities Act, extended background checks for gun purchasers under 21, funding for state red flag laws and other crisis intervention programs, and partial closure of the “boyfriend” loophole.
  • 07/29/2022 CHIPS and Science Act, the most significant research bill passed in a generation, including a $56 billion investment in American semiconductor production to incentivize companies to move chip production back into the US.
  • 08/02/2022, Honoring our PACT Act of 2022, expanded healthcare and other services for veterans who were exposed to toxic substances during military service.
  • 08/07/2022, Inflation Reduction Act of 2022, the largest climate investment in US history, also lowers prescription drug prices by giving Medicare the power to negotiate the prices of certain prescription drugs and extends expiring Obamacare health care subsidies for three years.

The scope of the issues addressed is significant: the pandemic and its economic fallout, highways, bridges, broadband, rail, manufacturing, science, semiconductors, prescription drug prices, health insurance, veterans’ health, climate change, deficit reduction and tax equity.

And they were passed within the constraints of a 50/50 Senate. Five of these laws, and all but the two biggies: the American Rescue Plan, and the IRA received Republican support. It’s pretty amazing that the Dems got this much.

So, whenever someone asserts that “Biden or the Democrats haven’t achieved anything” or that “Biden’s presidency has been a failure,” ask them to name as many significant pieces of legislation passed by Trump. Or, by Obama, Bush II, Clinton, Bush I, Reagan, Carter, Ford, or Nixon.

Only LBJ stacks up to the progress Biden has made so far.

But, it’s unclear how much this will help the Democrats in November. The Dems went into the 2010 midterms having passed Obamacare, a landmark piece of legislation, but they lost 60 seats and the leadership of the House. That was the biggest swing since 1948. Republicans also reduced the Democrats’ Senate majority.

So, as Wrongo stated yesterday, the political challenge for Democrats turns in large part to messaging —and targeting their message to the cohorts that make up the Democratic Party. Ruy Teixeira, a Democratic strategist affiliated with the American Enterprise Institute, wrote in the WSJ that Hispanics are no longer a sure cohort for the Democrats:

“It seems clear that Democrats seriously erred in 2020 by lumping Hispanics in with other “people of color,” assuming that they sympathized with the racial activism that dominated so much of the political scene that year. In reality, Hispanic voters are not a liberal voting bloc, especially on social issues.”

More:

“In a Pew postelection survey, just 20% described themselves as liberal, while 45% were moderate and 35% conservative. Surveys show that Hispanics are overwhelmingly an upwardly mobile and patriotic population whose main concerns are jobs, the economy, healthcare, effective schools, and public safety.”

Teixeira cites the polling firm Civiqs’ survey in late July that showed that just 12% of Hispanic working-class voters said their family’s financial situation had gotten better in the last year, while 50% said it had gotten worse.

In general, Hispanic voters cite inflation and the economy as by far their top issues for 2022. They could be a tough get for Dems who want to focus voter attention on abortion rights, their legislative achievements, and the Jan. 6 hearings.

How should Democrats message Hispanic voters?

We’re at an inflection point. All of the above happened because there were 50 Democratic Senators. It wouldn’t have happened with 49. It might have been bigger with 52 or more. Lose control of the House in November, and see Biden impeached.

These are things all Democrats should be reckoning with. Let’s leave the last words to Hubbell: (brackets by Wrongo)

“We have the policies, the positions, the values, and the candidates necessary to win. We need to….engage without fear or hesitation…..Let’s capitalize on the string of mistakes and “pulling back the curtain” moments that have revealed…[Republican] depravity as never before. We have every reason to be confident but no reason to be complacent!”

 

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Run On Roe And Reform

The Daily Escape:

Perkins Cove, Ogunquit, ME – July 2022 photo by Adam Silverman Photography

From the Kansas City Star:

“The right to an abortion will remain in the Kansas Constitution. In the first ballot test of abortion rights in a post-Roe America, Kansas voters turned out in historic numbers to overwhelmingly reject a constitutional amendment that would have opened the door for state lawmakers to further restrict or ban abortions across the state.”

Kansas voters showed that the Supreme Court’s decision in Dobbs doesn’t sit well, even in one of the country’s most conservative states. Democrats should adjust their 2022 Midterms messaging and strategy accordingly, to make it clear that Roe and Reform are what they’re running on.

Across party lines, abortion rights remain popular while the Supreme Court’s ruling is not. The most recent CNN poll found that 63% of Americans disapproved (51% “strongly”) of the court’s decision.

The NYT reported about Kansas:

“From the bluest counties to the reddest ones, abortion rights performed better than Mr. Biden, and opposition to abortion performed worse than Mr. Trump,”

The NYT had several observations:

  • Abortion opponents under performed even in conservative areas. In Hamilton County, which voted 81% Trump in 2020, less than 56% chose the anti-abortion position. In Greeley County, which voted more than 85% for Trump, only about 60% chose the anti-abortion position.
  • Kansas’s swing areas swung left. Wyandotte County, (where Kansas City is located), voted 65% for Biden in 2020, but 74% for abortion rights. Neighboring Johnson County, the state’s most populous, voted 53% for Biden but more than 68% for abortion rights.
  • Turnout was high. Before the election, the Kansas secretary of state’s office predicted turnout of about 36%. But anecdotal evidence indicated turnout might hit 50%, an extraordinary increase over what was expected.

Here’s TPM’s Josh Marshall’s Twitter thread on what Kansas means to the Democrats’ Mid-term road map: (emphasis by Wrongo)

2/ When a result is this lopsided & this unexpected for most political observers it’s not only a political earthquake but a sign many political professionals have seriously mistaken the political terrain. When there’s a political backlash as strong as the one against Dobbs 


3/ and one party is as firmly tied to it as Republicans are here, clearly the opposing party needs to grab on to it with both hands. Abortion rights will be central to numerous races this fall. But Democrats need to make the connection as explicit and tangible as possible.

4/ The way to do that is to make a firm pledge that if Democrats hold the House and add two Senate seats they will make Roe into federal law in January 2023. They are at present kinda sorta suggesting something like that, maybe. But clarity is everything. Give us this 


5/ specific result and this is specifically what we will do. Kansans didn’t turn out in these lopsided numbers to make a statement about Dobbs or Roe. They did so because they knew that the outcome of this one vote would immediately and dramatically affect the right 


6/ to a safe and legal abortion in the state. Democrats need to approximate the same clarity at the federal level, both to undo Dobbs and also to secure their hold on Congress. The way to do that is to get all 48 (non-Sinema/Manchin) senators to make a firm pledge that 


7/ if the House is held and two Democratic senators added they will vote for a Roe law in January 2023 AND suspend the filibuster rules to guarantee that bill gets an old fashioned up or down majority vote. So far 31 Senate Democrats have said they’ll do that (though not 


8/ yet on the specific date). All but two of the 17 are basically there but still refuse to say it clearly. There are two potential hold outs. Angus King of Maine and Mark Warner of Virginia. They will all certainly fall in line quickly if constituents apply pressure now.

The Kansas vote shows that the anti-abortion Republicans have misjudged how deeply this issue resonates for voters. When a Constitutional right simply disappears, apparently, the voters will turn out.

The polls have consistently shown that the majority of this country is pro-choice. The rejection of the Kansas amendment shows that if the election were to be a referendum on pro-choice, Democrats will win.

The Republicans should be afraid that they have gone too far. Let’s hope this is a bellwether for the midterms.

(Hat tip to long-time blog reader and Kansas resident Monty B. for keeping Wrongo apprised of the Kansas fight to turn back this amendment).

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Sunday Cartoon Blogging – July 17, 2022

Joe Manchin has done it to the Dems again. After laying out his conditions for supporting a scaled-down version of Build Back Better, he decided at the last minute that he couldn’t support his own conditions.

For nearly two years, the Dems have tried to create a package that Manchin could support, including funding for renewable energy and electric vehicles. Manchin has now indicated he can’t go that far, which jeopardizes Democrats’ chances in the Midterms.

Manchin blamed inflation (now at a 40-year high). Backing a $300bn bill that offers tax credits and funding to clean energy would, he argues, push pocketbook costs higher for Americans, although economists have disputed this. From the Guardian:

“A less charitable view of Manchin is that he is dangerously conflicted due to his own investments in fossil fuels… and that his judgement has been warped by the largesse of the industry, which has donated more money to him than any other senator.”

Congress hasn’t been able to pass anything to reduce climate change, despite public opinion being clearly in favor of doing just that. We expect Congress to pass laws that reflect the public’s opinion. But finding 60 Senate votes for anything vaguely controversial isn’t likely to happen in America today. The result is a set of federal laws that do not reflect what Americans actually want. On to cartoons.

Biden’s Saudi visit went well:

The fake (not fake) very real dilemma of the pregnant 10 year-old:

Back to school clothes for 4th grade:

Pence was nearly kidnapped by his Secret Service detail. The fly knew:

Is the Dem’s 2024 flavor appealing or appalling?

Images from the Webb telescope enter popular culture:

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Wednesday Wake Up Call – June 29, 2022

The Daily Escape:

Asheville morning, June 28, 2022 – iPhone photo by Wrongo. The log house we’re renting this week is at 4,000’ above sea level.

Wake up calls by the Wrongologist rarely happen on Wednesdays, but since the Roberts Court dismantled the line between church and state in public education with Justice Gorsuch’s decision in Kennedy v Bremerton School District, on Monday, it seems right.

Voting 6-3, the Court declared that an Oregon public high school football coach’s post-game prayer sessions with students were Constitutional, whether the students wanted them or not. That made Monday part of a pretty good run for American theocracy:

“The decision came less than a week after the court ruled, by the same vote, that Maine could not exclude religious schools from a state tuition program.”

The line between church and state is being erased before our eyes. Gorsuch, cherry-picking the facts of the case, wrote that football coach Kennedy had sought only to offer a brief, silent and solitary prayer:

“Respect for religious expressions is indispensable to life in a free and diverse republic — whether those expressions take place in a sanctuary or on a field, and whether they manifest through the spoken word or a bowed head…”

Justice Sotomayor responded that the public nature of his prayers and his stature as a leader and role model meant that students felt forced to participate, whatever their religion and whether they wanted to or not. She gave a different account of the facts, taking account of a longer time period:

“Kennedy consistently invited others to join his prayers and for years led student-athletes in prayer…”

In an unusual move, Sotomayor’s dissent included photographs showing Mr. Kennedy kneeling with players, which debunked Gorsuch’s selective use of facts.

Do you really think that this decision would have been the same if those prayers had been offered by a Muslim?

In the process of ruling for Mr. Kennedy, the majority overturned a major precedent on the First Amendment’s establishment clause, Lemon v. Kurtzman. That ruling was decided by an 8-0 vote under Republican Chief Justice Warren Burger. As an aside, John Dean (of Watergate fame) has said that during the Nixon administration, Burger threatened to resign from the Court if Nixon nominated a woman to it.

It came to be known as the Lemon test, which required courts to consider whether the challenged government practice had a secular purpose, whether its primary effect is to advance or inhibit religion, and whether it fosters excessive government entanglement with religion.

Sotomayor acknowledged that while the Lemon test had been frequently criticized by various members of the court:

“The court now goes much further…overruling Lemon entirely and in all contexts.”

So, by tossing out Lemon and saying that Coach Kennedy was not speaking for the school because it was an extra-curricular activity, the barrier between prayer and secular school has been permanently breached.

In today’s America, outside money will fund your culture wars grievance in the courts. The longer you can keep your case moving up through the courts, the better chance you have of running into a conservative Christian judge who will find a precedent for the White people’s Jesus in the Bill of Rights.

Teachers will now feel empowered to “invite” a group to pray with them. A few kids will jump in right away, while others will look around uncomfortably and gradually agree to join in, because the social opprobrium that comes with refusing is huge for kids. And since the person inviting you to pray is an authority figure: a teacher, coach, or principal, you really risk a lot by having them decide you aren’t:  A.Good.Christian.

When given the choice between upholding traditional case law or creating de novo judicial principles, the Roberts Court is almost always going to favor the latter.

Wrongo isn’t a lawyer, but many lawyers are now pointing to the extraordinarily shoddy nature of the Court’s majority opinions, including all three of the precedent-shattering ones the Court has issued over the last week.

It’s time to wake up America! Why is it so hard for Christians in the United States to just practice their religion without involving the rest of us?

We’re getting very close to the establishment of a default Christian American religion. We know that there are many public school teachers who have been silent despite their sincere religious beliefs while at school. Now they will be actively pressured by their pastors to begin proselytizing while on the clock.

To help you wake up, let’s travel to the 2022 Glastonbury music festival, which always creates great live music. On June 25, Olivia Rodrigo and Lily Allen dedicated the latter’s song “Fuck You” repurposed to express anger at five of the six Conservative members of the court.

Rodrigo named the Justices one by one, while Allen raised alternating middle fingers to them:

These artists aren’t afraid of controversy. Millions of us now feel exactly the same.

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The US Jobs Market and The EU vs. Russia

The Daily Escape:

Sunset, Lake Sammamish, Issaquah, WA – June 2022 photo by Gary Hamburgh

Two pieces of news to think about today.

First, you can always tell when an economic boom is nearing its end, because the jobs market begins to get shaky. That seems to be starting. The WSJ reports that:

“Businesses in several different industries are rescinding job offers they made just a few months ago, in a sign the tightest labor market in decades may be showing cracks.”

No need to panic just yet, the labor market remains strong, with an unemployment rate at 3.6%, near a half-century low. But signs of retrenchment in hiring shows that executives are having trouble predicting the economy over the next 12 months.

And when companies revoke job offers, it indicates their view of the future business outlook has changed so quickly that it’s undoing hiring plans made only a few weeks before.

Many hiring managers say signing up new recruits remains highly competitive. The WSJ reports on a Gartner survey of more than 350 HR executives conducted in May that found around 50% thought the competition for talent would increase over the next six months. Nearly two-thirds said they hadn’t made any changes to their hiring practices or HR budgets in response to economic volatility.

But it seems there are changes afoot. Country wisdom says that a storm rarely hits us without warning. The skies turn dark, the wind picks up, the birds go quiet. It’s possible to see the signs before the storm hits if you know what to look for. We’re seeing signs now of what’s to come.

Second, there’s an adage, attributed to Trotsky, but difficult to verify, that says: “You may not be interested in war, but war is interested in you.” Those words are apt in today’s situation between Europe and Russia. CNN is reporting about an emerging flashpoint between Russia and the EU:

“Tensions are mounting around…the Russian exclave of Kaliningrad, an isolated but strategically significant territory on the Baltic coast…Russia has reacted furiously after Lithuania banned the passage of sanctioned goods…into Kaliningrad. But Lithuania says it is merely upholding European Union sanctions, and the European bloc has backed it.”

Kaliningrad is Russia’s westernmost territory and it has no land connection to Russia. It’s the only part of Russia that is completely surrounded by EU states. Here’s a map:

Estonia, Latvia, Lithuania, and Poland are all members of NATO, surrounding Kaliningrad militarily. Since Russia invaded Ukraine, experts have feared that Kaliningrad might become the next flashpoint in tensions between Moscow and Europe.

Russia says that Lithuania’s sanctions on goods transit is a blockade in violation of a 2002 agreement to allow goods to flow between Kaliningrad and Russia. Sanctions apply to about 50% of Russian shipments. The sanctioned products include construction machinery, machine tools and other industrial equipment. But food and personal travel are not sanctioned.

Since the Baltic freezes during the winter, resupplying Kaliningrad will become particularly difficult in about six months. Lithuania has also closed its airspace to Russia. A Berlin-style airlift could prove problematic as well.

Lithuania has spent years building a liquid natural gas (LNG) port and the infrastructure necessary to connect to Nordic and EU grids. She was therefore able to shut off Russian oil, gas, and coal quickly and is in a better position to do without Russia’s gas than the rest of the EU.

Lithuania imports 70% of its electricity from Sweden through a dedicated underwater cable. Sweden’s power is nuclear and hydroelectric, thus independent of Russia as well. Lithuania is also in a position to supply gas to Latvia, Estonia, and Poland through their LNG terminal.

So is Europe at a flashpoint? There’s little Moscow can do to Lithuania beyond threaten.

Is it just a matter of time before NATO and Russia are in a shooting war? Doubtful. Russia could try cutting off all oil, gas, and coal exports to the other NATO countries. Russia could then say they would sell to any countries that left NATO. That might not pop NATO’s balloon, but it might take some of the air out of it.

If Russia decided to do that, it would have to find a way to transport it’s oil, gas, and coal to alternate customers. That can’t happen quickly. Given that the adversarial relationship between Europe and Russia may last a decade or more, Russia will probably have to find alternative customers regardless.

Neither side wants to undertake drastic changes in energy supply too precipitously.

Wrongo doubts the Kaliningrad situation will lead to war, but each provocation and escalation increases the odds. We’re playing in a very high stakes game, given the nuclear weapons on all sides. But Europe and NATO can’t automatically bow to Russia’s threats.

NATO can’t be unwilling to fight, but there’s a difference between that and provoking a war. Right now, it’s difficult to see a peaceful end game between the US, NATO, and Russia

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Monday Wake Up Call – June 20, 2022

The Daily Escape:

Field of Valerian at Indian Henry’s Crossing with Mt. Rainier in background, WA – June 2022 photo by Edwin Buske Photography. Oh, and a deer.

For more than 100 years, there have been attempts to improve telephone, cable, and internet services in the rural areas of America. Most of them have failed because it isn’t profitable for private firms to string wire to a small group of users who live at great distance from the nearest phone, or cable company.

This is a problem that requires government help, in particular, from the federal government. And there’s an abundance of government grant and loan money available to help rural America build broadband connections in unserved areas.

Recently the bipartisan infrastructure bill created the Broadband Equity, Access and Deployment Program (BEAD) and the State Digital Equity Act to provide money to underserved areas through the National Telecommunications and Information Administration.

The $42.5 billion BEAD Program automatically gives each state $100 million to start, but to receive additional broadband funding, local governments must apply for grants that are due by July 18. The State Digital Equity Act has $1.5 billion to allocate, and state’s letters of intent are due July 12. Not much time left.

The American Rescue Plan Act (ARPA) also has a pool of $10 billion to expand broadband through the Coronavirus Capital Projects Fund, supervised by the Treasury Department. States had until Dec. 2021 to apply for the fund program, and until Sept. 24, 2022, to submit a grant plan to the Treasury.

But as always, distributing government money efficiently is an issue. Early in June the Government Accountability Office (GAO) issued a report “National Strategy Needed to Guide Federal Efforts to Reduce Digital Divide,” that found many flaws with these programs:

“Federal broadband efforts are fragmented and overlapping, with more than 100 programs administered by 15 agencies. Many programs have broadband as their main purpose, and several overlap…”

More:

“Despite numerous programs and federal investment of $44 billion from 2015 through 2020, millions of Americans still lack broadband, and communities with limited resources may be most affected…”

Here’s the GAO’s chart of the overlapping jurisdictions:

Looks impossible to navigate. The WSJ weighed in focusing on the FCC’s role. They concluded:

“…many residents are still stuck with service that isn’t fast enough to do video calls or stream movies—speeds that most take for granted. Many communities have been targeted for broadband upgrades at least twice already, but flaws in the programs’ design have left residents wanting.

The WSJ found that areas with a combined population of 5.3 million people had previously been fully or partially covered by at least one federal broadband funding program. But the FCC’s rules didn’t require ISPs or Telecoms to serve all customers equally, as long as they served a minimum number of locations statewide.

That allowed internet providers to pick only the profitable customers to upgrade. This meant they could take public money while leaving pockets of homes and businesses without access.

Wrongo detests that public monies are lining the pockets of private firms who won’t solve their own problems. He detests that our government can’t get out of its own way, even after Congress rouses from its slumber and allocates funds that can help out rural Americans.

Republicans blame big government inefficiency, and they have a point. They also laud Elon Musk’s Starlink low-earth orbit satellite internet service. They say it proves that private industry can solve this problem. Except that there’s a 2+ year wait for Starlink services in much of rural America. And it’s estimated that the Starlink ground antenna costs $2500 to build, but is sold for $600. Who’s paying the difference?

And Starlink satellites have to connect to ground stations (NOCs) that connect to the web. Starlink’s speeds have slowed recently because they haven’t built NOCs fast enough.

It will never be profitable for private firms to connect the last mile to very rural homes. So there’s a role for government, properly managed. We subsidize the farms, roads, postal service, telephones and now, the broadband needs of rural people. Apart from factory farms, these are among the least economically productive areas in our economy.

And the best part? They hate the people who foot the bill!

Time to wake up America! Our public-private “partnerships” that are trying to get internet services to the toughest to reach parts of the country aren’t working. They need more red-tape cutting and more corporate CEO feet held to the fire if they are to work.

This can be done. America went to the moon before we put wheels on luggage.

To help you wake up, let’s spend a few minutes with Paul McCartney, who turned 80 recently. Take this opportunity to cherish his presence. Here’s McCartney doing “Jet” live at Glastonbury in 2004 when he was 62:

Don’t worry, nobody knows what the song is about.

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Saturday Soother – June 18, 2022

The Daily Escape:

Rainy morning, with Vista House at Crown Point in right foreground, Columbia River Gorge, WA – June 2022 photo by David Leahy Photography

Wrongo has written before about the crushing burden of consumer debt in the US. Medical debt is an American disgrace, and Noam Levey, Kaiser Health News (KHN) Senior Correspondent has written an excellent piece about it. He says that 100 million people in America, some 41% of adults, owe some level of debt to healthcare providers.

But most studies don’t reveal the actual extent of the debt because much of it appears as credit card balances, loans from family, or payment plans arranged with hospitals and other medical providers. To calculate the true extent and burden of this debt, KHN partnered with NPR, and the Kaiser Family Foundation (KFF) to conduct a nationwide poll designed to capture not just bills patients couldn’t afford, but other forms of borrowing used to pay for health care.

The results are contained in the KFF Health Care Debt Survey. The KFF poll found that half of US adults don’t have the cash to cover an unexpected $500 health care bill. As a result, many simply don’t pay their medical bills. The flood of unpaid bills has made medical debt the most common form of consumer debt in America.

Over the past five years, more than half of US adults report they’ve gone into debt because of medical or dental bills. Moreover, a quarter of adults with health care debt owe more than $5,000, and about 20% with any amount of debt said they don’t expect to ever pay it off.

Debt incurred for health care is forcing many families to cut spending on food and other essentials. The poll also found that millions are being driven from their homes or into bankruptcy:

So, if 100 million people were in debt and 17% declared bankruptcy or lost their home, that’s 17 million people! The KFF poll found that the debt is also preventing Americans from saving for retirement, investing in their children’s educations, or buying a home. And debt from health care is nearly twice as common for adults under 30 as for those 65 and older. And that age cohort is supposed to be much healthier than the elderly.

Perversely, about 1 in 7 people with medical debt said they’ve been denied access to a hospital, doctor, or other provider because of unpaid bills. An even greater share (two-thirds) have put off care that they, or a family member need because of the cost.

Hospitals are among the culprits. They are capitalizing on their patients’ inability to pay. Hospitals and other medical providers are pushing millions of patients who can’t afford to pay into credit cards and other loans. These are high interest rate loans, carrying rates that top 29%, according to research firm IBISWorld.

This collections business is fed by hospitals, including public university systems and nonprofits granted tax breaks to serve their communities, who sell the outstanding debt to collections companies.

Welcome to the best country on earth, (maybe) one that doesn’t have the best health care system (and certainly one without  health insurance for all). We have a system which shackles 100 million people to medical debt while at the click of a computer mouse, we send $billions in armaments overseas before those same dollars are recycled into the coffers of our Military-Industrial complex.

That’s all for this week. It’s time for our Saturday Soother, when we take a break from the J6 public hearings and whether Ginni Thomas was another Trumpist plotter. Let’s focus on calming ourselves for whatever insults are coming next week.

Here at the Mansion of Wrong, we’re engaged in an air conditioning project, adding more central air to our home. Hey, we’re aware of the crummy stock market, and the rampant inflation, but consume we must.

To help you clear your head on this warm weekend, grab a seat outdoors and brew up a cup of Supernatural coffee ($18.45/12 oz.) by Lee, MA’s own Barrington Coffee Roasting Company. This espresso is said to have flavors of Concord grape, dark chocolate, plum and tangle berry pie!

Wrongo has no idea what tangle berries look like, much less what they taste like.

Now, put on your wireless headphones and listen to the “Adagio for Oboe, Cello, Organ and Strings”, also known as “Elevazione” or “All’Elevazione” by Domenico Zipoli.

Zipoli was an Italian Jesuit priest who lived much of his life in what is now Argentina. He studied with Scarlatti, became a Jesuit, worked as a missionary, and died in 1726 in Argentina at age 38. If fate had granted Zipoli another 20 to 25 years, he might be regarded today as a major composer. Here it’s performed in 2015 by the Collegia Musica Chiemgau conducted by Elke Burkert :

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Saturday Soother, Inflation Edition – June 11, 2022

The Daily Escape:

Blackfish Creek, Wellfleet, MA – June 2022 photo by Jo LF

Wrongo and Ms. Right are on the road again, this time on Cape Cod visiting family. So this column will be brief. We saw on Friday that the Bureau of Labor Statistics gave us more bad news, that inflation jumped higher in May. That caused the Dow to decline by 880 points or about 2.7%.

From the Bondad blog: (parenthesis by Wrongo)

“People who were hoping inflation would abate did not get the news they wanted from the May CPI. Consumer prices rose 1.0% in that month alone. Inflation less energy rose 0.7%, and “core” inflation less food and energy rose 0.6%. On a YoY (year over year) basis, prices are up 8.5%, tied for a multi-decade high with a few months ago. Core prices are up 6.0%, down slightly from their February and March peak…”

Bondad says that this means that the Fed will continue stomping on the brakes. The big question is whether the Fed can engineer a relatively short and gentle recession, perhaps in 2023. Or whether instead, they engineer a good, old-fashioned “bust” that hurts all of us.

A recession happens when the economy contracts for two successive calendar quarters. In the first quarter of 2022, GDP declined 1.6%. If we see a similar result for the second quarter, this will meet the classic definition of recession.

Will that happen in 2022? Maybe. Will it happen in 2023? Probably. It is highly unlikely that the Fed’s actions alone will bring aggregate demand down to normal levels relative to supply.

Republicans are messaging that it’s the Biden administration’s fault that inflation got out of control. But if you remove politics from the equation, the reasons are the pandemic’s severe global economic impacts, and the efforts by both the Trump and Biden administrations, along with the Fed, to stimulate the US economy.

The stimuli led to a booming economy, even though it didn’t help everyone. The Fed’s inability to react quickly then left them behind the curve. Russia’s invasion of Ukraine created an oil shortage, that pushed gasoline prices even  higher.

The complex causes of our current inflation doesn’t lend itself to either Party presenting workable solutions in the short term. And they certainly can’t do that by using sound bites. And you shouldn’t expect the media to either provide both sides of the argument, or to detail what’s being offered to solve the problem.

After all, we’re in an election year.

Wrongo will wait a few more days before saying much about the J6 public hearing. We didn’t get to see much of it, but the WaPo says that about 19 million people watched the first public hearing. The preliminary data come from Nielsen and do not include the millions more who watched the hearing on streaming apps or social media, where a few clips of the testimony went viral.

The Post also provided some context, comparing the viewership of this hearing to Watergate and to Trump’s first impeachment:

“….some 71% of Americans told Gallup that they watched some of the Watergate hearings live back in 1973, the first televised hearing of Donald Trump’s first impeachment trial drew only about 13 million viewers in 2019…”

It’s time to let the millions of words about the hearing slip from your mind, and to get yourself into a place of calm reflection. That means it’s time for our Saturday Soother. We’re here on the Cape trying to do just that. The weather so far is fantastic. And we’re scheduled for dinners at two fabulous restaurants over the next two nights, in both cases, eating outdoors.

So, take a few minutes to center yourself by grabbing a chair outside, putting on your wireless headphones and listening to Lili Boulanger’s “D’un matin de Printemps” (On a spring morning). Lili wrote this piece in 1917 when she was 23. Boulanger was a child prodigy, but she battled bronchial pneumonia throughout her short life, dying a year later at age 24.

Here is the piece played in 2017 by the Chicago Youth Symphony Orchestra, conducted by Allen Tinkham at Orchestra Hall, in Chicago:

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J&J’s Texas Two-Step

The Daily Escape:

Wallowa Lake near Joseph, OR – May 2022 photo by Danny J Goff

From Judd Legum:

“Nearly 40,000 lawsuits have been filed against Johnson & Johnson (J&J), alleging that the company’s baby powder causes cancer. The lawsuits claim that customers became sick with mesothelioma or ovarian cancer after being exposed to asbestos contained in talcum powder.”

In July 2018, a Missouri jury awarded $4.7 billion in damages to 22 women who said they contracted ovarian cancer from J&J baby powder. According to judge Rex Burlison, J&J:

“…knew of the presence of asbestos in products that they knowingly targeted for sale to mothers and babies, knew of the damage their products caused, and misrepresented the safety of these products for decades.”

Obviously J&J appealed, and an appeals court reduced the verdict to $2 billion. J&J wasn’t satisfied and further appealed the verdict, ultimately to the US Supreme Court. In June 2021, however, the Supremes refused to hear the case, letting the $2 billion award stand.

J&J had no interest in bankruptcy, but came up with another strategy to protect most of its assets from the current and any future judgements. In July 2021, the company launched “Project Pluto,” in which J&J would create a new subsidiary, LTL Management, which would “own” the liability for the baby powder litigation. It also would receive about $2 billion in cash. LTL would then declare bankruptcy.

More from Judd Legum:

“J&J is attempting to exploit a 1989 Texas law, deploying a legal maneuver known as the “Texas two-step.” J&J temporarily became a Texas company and then executed a “divisive” merger. The move split J&J into two new companies: one with almost all of the assets and no baby powder liability and another with all of the baby powder liability and few assets.” The latter almost immediately filed for Chapter 11 bankruptcy.

More:

“By filing for bankruptcy, all civil litigation against LTL Management is immediately halted. The claimants no longer have the ability to have their claims heard in court. Instead, if the scheme is successful, all claimants have to split up a limited pool of assets defined by J&J.”

That’s the “Texas Two-Step.” You may remember that in 2021, the NRA had requested to be reincorporated in Texas when it filed for bankruptcy, a move hailed by Texas governor Gregg Abbott. It would also have led to splitting the NRA into two companies, with the liability in the new firm. That effort failed when a Texas judge wouldn’t allow the move without the approval of New York State, something NYS wouldn’t do.

It’s possible in every state to split a company’s assets and liabilities through a spin-off, and spin-offs have often been used to fraudulently transfer assets that might be part of a bankruptcy. The Two-Step exploits a quirk of Texas law, which defines “merger” as including not just two companies merging into one, but also the exact opposite, when a company divides into two or more entities.

Texas and Delaware are the two states that allow for such “divisive” mergers. This type of “merger” avoids what in bankruptcy circles is called a “fraudulent transfer” of assets, assets that should by rights be considered a part of the bankruptcy estate to be divided among the firm’s creditors.

The deemed lack of an asset transfer is what makes the Texas Two-Step unique and interesting to J&J.

The Senate Judiciary Subcommittee on Federal Courts, Oversight, Agency Action, and Federal Rights, led by Sen. Sheldon Whitehouse (D-RI), is looking into the legality of the Texas Two-step:

“It does not make sense for a $450 billion corporation with 38,000 people with potentially lethal injuries to be able to carve off $2 billion…and walk away from the responsibility for what it did.”

We’ll see what becomes of the lawsuits against J&J and the LTL Management company.

More broadly, this shows we need to substantially strengthen the US bankruptcy fraudulent transfer laws. Unfortunately, that’s a political fight between the capitalist wolves and the consumer lambs, with all the best lawyers on the side of the wolves. For example, J&J has retained Neal Katyal, former Acting US Solicitor General under Obama to help with their liability carve-out. Katyal is earning $2,465/hour while working for J&J. Seems reasonable, no?

The wolves know that the legal positioning really matters. They will fight tooth and nail to keep the firm’s money in the firm and out of the hands of the plaintiffs. Even though there are substantially more lambs than wolves, the lambs have neither the resources nor the smarts to protect themselves.

These greedy schemes by America’s biggest firms are designed to dodge financial responsibility. J&J is attempting to cheat cancer patients from getting what the courts have already awarded them.

The management and their attorneys should face prison time for depriving justice to these consumers who won in court.

If we can’t bring Capitalism to heel, it must go.

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Saturday Soother – May 28, 2022

The Daily Escape:

Memorial Day, Arlington National Cemetery – May 2013 photo by William Coyle

Welcome to America’s Memorial Day weekend, when we remember those in the military who died in service to the country. But this year, we must also honor those who have died from mass murder by gun right here at home.

We need a three-day weekend. We need a break from the slowly unveiling and depressing news out about how shamefully the police of Uvalde, TX reacted to the killer. We also need a break from listening to the tepid responses by both political Parties.

The Republicans are saying the same as always: The country should not have stricter gun control. Why do Republicans refuse to act? Beyond the fact that many believe stricter gun control would not prevent such mass shootings, recent polling data reveal that there’s less political pressure on them than you might have thought.

Let’s examine the public mindset on the gun control debate as shown in Gallup’s polling conducted in October 2021 and January 2022. Both polls found a slight decrease in support for stricter gun laws compared with the prior year’s measures. Here are the top line results:

Last October, 52% of Americans indicated they wanted stricter gun control, while 46% either thought laws should be kept the same (35%) or made less strict (11%). The headline is that Americans’ support for stricter gun control fell five percentage points from October 2020 to the lowest since 2014.

That decline was driven by a 15-point plunge among independents, while Democrats’ desire for more restrictive gun laws ticked up six points to 91%. Republicans’ views were essentially unchanged, at 24%, (after dropping 14 points in 2020).

Of course, these numbers can be hard to understand when polls also indicate that north of 80% of Americans want universal background checks for guns, which Democrats have been pushing for in Congress and which most Republicans won’t go along with.

Why? There’s no sign that the polling on background checks holds up when its on the ballot. CNN’s report (March 2021) showed that ballot measures for background checks have appeared on ballots in California, Maine, Nevada, and Washington.

In all four, the pro-gun control side’s vote margin was worse than the Democrats’ baseline in the same state. In 2016, Clinton won California by 30 points, while gun control won by 27 points. In Maine, Clinton won by 3 points, while gun control lost by 4 points. In Nevada, Clinton won by 2 points, while gun control passed by a single point. Lastly, Washington passed its gun control law by a little less than 19 points in 2018, while Washington state’s House Democratic candidates won by a bigger margin in the same year.

The question is: Why would Republicans feel political pressure to support more gun control, when something that polls as well as universal background checks doesn’t draw as much support as the Democratic presidential candidate?

And here are a few more depressing thoughts. First, before the assault weapons ban went into effect in 1994, there were about 400,000 AR-15 style rifles in America. Today, there are 20 million.

Second, it’s doubtful that you were aware that there is an active group of school principals who have survived a school shooting. It’s called the Principal Recovery Network, a support group of sorts that mobilizes to help principals in the immediate aftermath of a school shooting. Frank DeAngelis, the former principal of Columbine High School says:

“It’s like that club that no one wants to belong to,”

They provide support for a principal who’s having his/her worst professional day. In every scenario, the goal is to help a principal in crisis. This is America: We put all this energy into dealing with the aftermath of a preventable trauma, and that now includes therapy for principals. We’re in this dark place because we will not open our eyes.

And for the 21st time since a mass shooting in Isla Vista, Calif. in 2014, the satirical site The Onion republished its saddest headline:

“No Way To Prevent This,” Says Only Nation Where This Regularly Happens

The best way to stop a bad guy from getting a gun is prevention.

Time for our long weekend Saturday Soother. The blog may be taking some time off, so don’t expect to see another column before Tuesday.

In view of the Memorial Day observance, and to remember those who died in Texas, listen to Samuel Barber’s “Adagio for Strings”, played in the original version by the Dover Quartet. Barber finished the arrangement in 1936. In January 1938, Barber sent an orchestrated version of the Adagio for Strings to Arturo Toscanini. The conductor returned the score without comment, which annoyed Barber.

Toscanini later sent word that he was planning to perform the piece and had returned it simply because he had already memorized it! It was performed for the first time by Toscanini in November, 1938. Here, for the third time on the blog, is the quartet version of “Adagio for Strings”:

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