Local and state campaigns have become a moneyed battleground this year for corporations and special interest groups hoping to sway the results of elections for local and state offices on Nov. 6.

From California to Texas to Florida, global businesses as well as ideological organisations and extremely wealthy groups have helped channel more than 1.6 billion dollars through political action committees and into local campaigns and issues this year, according to the National Institute on Money in State Politics, a non-governmental organisation (NGO) that analyses state campaign-spending reports.

Some of the cash went into campaigns of local lawmakers. Other amounts supported campaigns for judges. More than 6,000 legislators are running for election Tuesday, according to the National Council of State Legislators, with most relying on private funding.

Campaign money can be difficult to track, since states set their own campaign finance laws, and money flows in and out of state and federal political parties, political action committees and non-profits and into campaigns and issue advocacy.

“Money is access, and it definitely influences the outcomes of elections,” Judy Nadler, a government ethics expert at Santa Clara University in California, told IPS. In some states, “huge amounts of money [go] unreported and unregulated.”

This “outside spending” increased 38 percent between 2006 and 2010, according to the National Institute on Money in State Politics. Spending by candidates increased 19 percent during that time, it found.

Large chunks of special interest money also were directed at state ballot measures, which are decided by voters in individual states. This year, 38 states have ballot measures, according to the National Council of State Legislatures.

From coast to coast

A national overview of money spent per state on election campaigns and committees. Credit: National Institute on Money in State Politics/Creative Commons

Nowhere is the impact of moneyed interests more obvious than in California, where 570 million dollars have been spent leading up to Tuesday’s elections. Of that amount, 421 million dollars have gone to groups arguing for or against ballot measures, including those related to tobacco and genetically modified foods.

A California proposal to raise taxes on a package of cigarettes by one dollar was voted on and narrowly defeated earlier this year during the state’s primary election. Pro-health groups spent 18.2 million dollars advocating for the measure, but tobacco companies, including global giants Philip Morris and Reynolds, spent 46 million dollars to bolster their pro-tobacco stance through advertisements.

A measure to label genetically modified foods has pitted consumers, organic farmers and businesses, who have ponied up 8.2 million dollars, against well-armed agricultural corporations and supermarkets, which have spent 48.7 million dollars.

The biotechnology giant Monsanto has contributed 7.1 million dollars to defeat the labelling proposal, followed by Dupont (4.9 million) and Pepsico, (2.1 million), among many others.

“We have been shut down by biotech on this issue,” Grant Lundberg, CEO of Lundberg Family Farms, an organic rice grower and processor, and co-chair of the Non-GMO Project, told IPS. “They have had a big impact. They have gotten their lies out and confused people. We have limited resources.”

In Texas, where donations to this year’s candidates exceeded 113 million dollars, some individuals and businesses stood out for their especially large contributions to the electoral process.

Bob Perry, the Houston real estate mogul who helped bankroll presidential candidate Mitt Romney, mainly by donating more than 10.7 million dollars to the Super PAC Restore Our Future, is one, according to the Centre for Responsive Politics, a Washington NGO that analyses campaign finance reports. This year, Perry has made a mark of 2.4 million dollars on Texas politics.

More than 72.5 million dollars were dumped into Florida campaigns for 2012, where pro-business special interests figured prominently. The utility company Progress Energy gave the most money – 709,000 dollars – to candidates, about 90 percent of them Republican.

Other major corporate donors include private health insurance company Blue Cross Blue Shield, which gave 648,000 dollars, and the Walt Disney Company, which donated 497,000 dollars. Multi-billionaire conservative Sheldon Adelson, a Las Vegas casino magnate, also got involved in Florida politics; he gave 250,000 dollars to the state Republican Party.

“What we shouldn’t have is corporate financing of elections. Corporations are not people. They don’t vote and should not be involved in selecting our government,” said Craig Holman, a government affairs lobbyist for Public Citizen, a consumer advocacy NGO in Washington, DC.

Influential PACs

Political action committees (PACs) and political non-profits also are influencing politics in Florida, as they do in many other states.

Three Florida Supreme Court justices are at risk of being unseated by conservative groups angry about the justices’ support for President Barack Obama’s 2010 healthcare law. According to an investigation by the Centre for Public Integrity, the attack against the judges is being waged largely by two well-funded ultra-conservative political organisations, Restore Justice 2012 and Americans for Prosperity, funded by the conservative billionaire Koch brothers. A third politics group, Defend Justice from Politics, is backing the judges.

How much money is involved in the judges’ re-election campaigns is unclear, however, due to Florida’s murky reporting requirements.

Grassroots efforts to expel money from politics are underway in a number of states, including New York. And a number of states including Arizona, Connecticut and Maine have already tightened up their campaign finance rules, mostly due to citizen efforts. A sweeping law to reform relaxed campaign finance rules in Massachusetts was passed by citizens in 1998, but was repealed by lawmakers.

Some candidates are taking matters into their own hands by refusing corporate money or in the case of one candidate running for the Massachusetts state house, refusing money altogether.

Mike Connolly, also known as No Cash Mike, told IPS that “money in the political system gets in the way of actual progress”. He added, “94 percent of the time the candidate who raises the most money wins. When a few individuals can have a profound impact on an election and on the direction of government, that really cuts against the essence of democracy.”

By Adrianne Appel
KENANSVILLE, Florida , Apr 20 2012 (IPS)

There was a time when big, yellow cats freely roamed the length of a wild Florida. Today, three medium-sized humans are trekking the length of this southeastern U.S. state – 1,000 miles of swamp, forest, ranchland and blistered feet – in hopes that panthers may one day be able to safely tread the same path.

“We are all focused on the mission and little things don’t get to us,” said photographer Carlton Ward, who along with bear biologist Joe Guthrie and filmmaker Elam Stoltzfus have been walking, canoeing, biking and horseback riding Florida’s natural areas since January.

Along the way they spent too long carrying their canoes and gear up and over countless downed trees by Josephine Creek, and passed two memorable nights camping on an active U.S. Air force bombing range.

“They were practicing shooting down black hawk helicopters,” Guthrie said.

By Earth Day, Sunday Apr. 22, they expect to be closing in on the Okefenokee Swamp in Southern Georgia, and the end of their 100-day journey.

The reason for the journey is to rally support for the creation of a Florida wildlife corridor, a north-south band of open space protected from development and shielded from vehicles, where the endangered panther, and black bears and other wildlife can travel.

“The corridor is a vision,” said Ward on day 47 of their trip, while resting under a hammock of trees at a cattle ranch.

Nearby, sandhill cranes jumped and flapped crazily – their mating dance. The air was dry and the grassy landscape, with grazing cattle and calves, looked more like Texas.

About 100 panthers live in Florida, on 3,500 acres in the uninhabited southwestern region of the state that includes the Everglades, where they hunt deer, wild hogs and rabbits. They are nocturnal and rarely seen by humans. They have been listed as endangered since 1967.

The panthers’ original territory extended from Louisiana up into Tennessee but hunting and encroachment by human development pushed them into what is now a fraction of their former territory. The animals are stressed, with 45 percent of their deaths each year due to fights with each other. For the population to grow, which it must to be healthy, experts say, the big cats need more land to roam.

The panther falls under the Endangered Species Act, a U.S. law governing the care of species on the brink of extinction, and that means the U.S. Fish and Wildlife Service is required to aid its recovery.

The Fish and Wildlife Service determined decades ago that the Florida panther population needs to grow to 240 individuals, and to have a total of three population clusters, with one in the northern part of the state and one in the south and natural areas connecting them, to be healthy and sustainable.

In the central part of the state, far from Florida’s crowded beaches and tourists, large swaths of contiguous open space remain, north and south. Converting these lands into areas reserved for wildlife would not be difficult, Ward says.

“We don’t need to buy land. It’s a matter of getting the easements,” Ward said.

Conservation easements are a novel method of preserving land from development, in which authorities pay owners a fee in exchange for an agreement that it cannot be developed.

But the plan has mostly sat idle. In 2011, the non-profit Center for Biological Diversity petitioned the U.S. Department of the Interior to allow the release of Florida panthers into northern Florida, to build a second breeding population, but the request was denied.

In 2010 the administration of President Barack Obama announced that it wanted to designate 100,000 acres in central Florida as conservation land, by purchasing the development rights. The land would fall within the hoped-for panther corridor.

So far, just 10 acres have been set aside for conservation under the programme.

“The programme exists. The authority exists. The money doesn’t,” Ward said.

Ward and his crew hope that their steps over logs and through swamps during the past four months will put muscle and money behind the open space programme and the wildlife corridor.

“It’s remarkable how possible it is. We’ve been on natural land for 47 days and walking the path that a bear or panther could walk,” Ward said during a stopover at a cattle ranch about 60 miles south of Orlando.

Much of the land is broken up by busy roads. Wildlife tunnels under the roads would help make it safe for panther, bear and other animals to travel freely, Ward says.

Male panthers do attempt to travel north already and are inevitably hit by vehicles north of the Everglades, their deaths obvious because of the radio collars many of them wear.

Some land in the planned corridor is clogged with development, like the banks of the Caloosahatchee River,

“The only way to get panthers north of the river is to carry them in a car,” Guthrie said.

At least one panther did brave the crowded riverbank. In 2008, it walked about 1,500 miles through Florida all the way to the interior of Georgia, where it was killed by a hunter.

The group hasn’t seen any panthers on their trek but in the Everglades area they knew the cats were out there.

“It’s amazing how many panther tracks we saw,” Ward said.

They did see scores of other remarkable wildlife, catalogued by Ward’s photos, including an Eastern indigo snake, the largest, non- poisonous snake in the U.S., bald eagles, sandhill cranes, the threatened Florida scrub jay, the rare grasshopper sparrow, and swallow-tail kites, listed as endangered in South Carolina.

It was in the Everglades that for three days Ward’s group saw no other people, as they pulled their boats through saw grass, the old way of Everglades travel, and slept in them at night. Further north, faced with the need to paddle cross the Caloosahatchee in stiff winds, they grabbed their coats – and sailed across.

Guthrie’s blog entries tell the full range of experiences of the team:

“It felt blistering hot and dry all day. My water was down to about half a liter by the time we arrived at our campsite.” Feb. 25

“In howling wind and three foot chop we struggled across the lake (Lake Marion) for the toughest two miles of the expedition.” Mar. 10.

“I grew lazy with the wind and current helping me along. I fished half-heartedly among a few dock pilings, catching a small bass every mile or so.” Mar. 23.

The wildlife corridor and the Obama administration’s 100,000 acre Florida open space plan would include thousands of acres now in ranching, an occupation traditionally fearful of panthers.

But Bud Adams, 86, wants the federal government to buy the development rights of some of his land, and his family has met with Obama and Interior Department Ken Salazar about it.

Adams says he backs the wildlife corridor and is not afraid that panthers would eat his cattle. The panthers are part of the ecosystem, he said.

“As a boy the panthers ate the deer. When the deer were gone, the panthers left. Now we have a deer population again and the panthers will have a place here.”

By Adrianne Appel
LAKELAND, FLORIDA, U.S., , Mar 15 2012 (IPS)

Dozens of Immokalee Florida farm workers left tomato fields behind last week and set up camp on the lush, corporate grounds of Publix supermarket to fast and protest the company’s refusal to pay a penny more per pound for tomatoes.

“If there were better conditions, like a fair wage, you would have the opportunity to provide for your family,” explained Nely Rodriguez, previously a farm worker and today an employee with the Coalition of Immokalee Workers (CIW), which has been pushing to improve the lives of Florida farm workers since 1993 and organised the Publix protest.

Rodriguez spoke on day three of the six-day fast-protest, over laughter and chatting from the 75 or so farm workers, students and members of religious organisations at the event. Every now and then, truckers and cars exiting the Publix compound honked their support as they drove by.

“It’s been an extremely powerful experience,” Marc Rodrigues, a CIW employee, said. “The only way it’s not going well is we have empty seats reserved for Publix officials and they haven’t come over and sat in our seats.”

By the close of the protest, which was visited by more than 1,000 supporters, including Ethel Kennedy and Kerry Kennedy, widow and daughter of Robert F. Kennedy, Publix still had not budged.

“If productivity standards are too strenuous, farmworkers should work for another employer,” Publix says in a statement.

“The CIW’s campaign against Publix is one directed at an acknowledged employer of choice and a great place to work,” Publix says.

“The truth is, it’s very difficult out there in the sun and heat,” Emilio Faustino said at the protest about the 12 years he has spent in the Florida tomato fields.

Faustino and 33,000 other Florida farm workers pick most of the tomatoes distributed to the U.S. East Coast, six to seven days a week in the south Florida sun, filling, carrying and lifting 32-pound bins of fruit by hand for 10-12 hours per day, while getting paid 50 cents per bin, or about 200 to 283 dollars per week.

“I see the Publix ads that say they support families. I would say we support our families. And for the betterment of our families we would like to work together with Publix and improve conditions,” said Faustino, 50, who lives in Immokalee with about 16 other men in a trailer with one bathroom, he said.

The 4,000 members of the Coalition of Immokalee Workers has been fighting for the per-pound increase – and more humane working conditions like providing shade and water to pickers in the fields – with unprecedented success.

Through marches, boycotts and public pressure, today more than 90 percent of Florida tomato growers abide by the improved working conditions, which include protection from pesticides and the right to complain about violations without being threatened.

Ten large food companies, from Subway to Whole Foods to Sodexo food service, have agreed to pay the penny increase and buy tomatoes only from those growers who are on board with the Immokalee workers’ agreement.

But Giant, Kroger’s, Martin’s, Publix and Stop and Shop have refused to sign on and continue to purchase tomatoes from the 10 percent of Florida growers who impose harsh conditions on workers. Other protests are planned and on Apr. 15, the CIW will march against Stop and Shop, in Boston.

“The wages have been very low. That’s how it’s been always been until recently,” Faustino said through a translator.

In 2011, the penny-per-pound increase made it into workers’ paycheques for the first time, and it matters, Faustino said. Depending on how much he works, he may see an additional 15 to 100 dollars in his paycheck, he said.

“I’m seeing changes in my life. I can buy better food,” Faustino said. “We never had shade in the fields. Now we have shade,” he said.

The new benefits are available to all eligible 33,000 farm workers, not just CIW members.

Some Florida tomato pickers work and live in desperate conditions where extreme exploitation thrives, including indentured servitude and rape by bosses.

CIW uses its radio station and visits to farms to get the word out to farm workers about their new rights under the Fair Food Program.

Since 1997, nine entities have been prosecuted under U.S. federal slavery and human trafficking laws, for actions involving about 1,000 tomato pickers. Workers in these cases were held against their will, beaten, forced to work, chained, and their wages taken.

The CIW is taking action against sexual exploitation of workers by crew leaders and bosses, Rodriguez said, and has set up a 1-800 hotline for workers with complaints.

“We’ve been able to go to farms and speak with workers directly about their rights,” she said.

She remembers that one crew boss was notorious for preying on young women when they left the group to use the toilet, she said.

“People were scared and didn’t know their rights,” so they didn’t complain, Rodriguez said.

Today, the Fair Food Program spells out that workers can’t be threatened with firing or violence if they complain. And CIW is there to back them up, Rodriguez said.

*Translators for this story include Marc Rodrigues, Brigitte Gunther and Jordan Buckley.

Excerpt:

By Adrianne Appel
BOSTON, Sep 2 2010 (IPS)

Stealthy submarine gliders slide through the depths of the Gulf of Mexico with the precision of birds of prey. Robot-like rovers search for droplets of oil thousands of metres under the surface. Powerful computerised analysers send instant results to scientists on board the ship above. All of this to assess the impact of disaster.

Oil platform in the Sonda de Campeche, Mexico, a country with more than 200 rigs in the Gulf. Credit: Photostock

That day the Deepwater Horizon platform, leased by the multinational British Petroleum (BP), suffered an explosion, and then sank on Apr. 22. It was not until Jul. 15 that the gushing leak could be stopped.

The U.S. National Science Foundation has so far funded 60 Gulf research projects, totalling 7 million dollars. BP has proposed spending 500 million dollars on Gulf research over 10 years.

A scientific team from the Woods Hole Oceanographic Institute (WHOI), near the northeastern U.S. city of Boston, has already been to the Gulf and back, and come away with “millions” of points of data to analyse, WHOI oceanographer Chris Reddy told Tierramérica.

“We want to know how much oil spilled, what was the status of the oil at a given point in time, and how it changes as it gets older,” he said

The team relied heavily on Sentry, their newest automated underwater vehicle. Programmable via computer, the bright yellow, square-shaped Sentry does not need to be tethered to a ship and dives to 4.3 kilometres below the surface, “until it finds oil, like a dog after bone,” Reddy said.

In mid-June, Sentry travelled from Boston to the Gulf of Mexico, where the WHOI crew loaded it aboard the research vessel Endeavor and set sail for a 12-day mission.

Sentry’s main purpose was to search for plumes of oil. Lead scientist Rich Camilli equipped Sentry with a tiny mass spectrometer (used to measure and analyze molecular compounds), adapted to work deep underwater.

The crew programmed the underwater vehicle to “sniff around” in the water until it located the highest concentrations of oil and take samples, sending the results back to Reddy, on board the Endeavor.

Reddy used the results from the mass spectrometer to determine the Deepwater Horizon crude’s unique “genetic” fingerprint, the characteristics that set it apart from other loose oil in the Gulf, an area of intense petroleum exploitation.

“Crude oil is old plant material that has been cooked and squeezed in the earth,” Reddy said. Oil is made up of different compounds, and they are present in different ratios, depending on the origin of the oil. Scientists can test for these ratios in samples of oil.

“I exploit those properties as a scientist,” Reddy said. “I can tell, for example, that there’s been a lot of evaporation of oil,” due to the warm Gulf water, the hot summer temperature and the wind, he added.

Oil changes over time, and that, too, can be analysed. Some compounds break down easily in the water, others evaporate, while still others are resistant and tend to persist in the form of “tar balls.”

“It’s environmental forensics,” Reddy said.

This enabled the team to determine where the Deepwater oil moved on the surface and in plumes thousands of meters under the water. Reddy analyzed oil that coated a marsh on the Louisiana coast 80 kilometres from the wellhead: “I could see the Deepwater fingerprint and that it had already undergone significant evaporation.”

Before the Endeavor set sail, WHOI engineer Rich Ahern launched a sleek, autonomous vehicle in the Gulf called Spray glider, a joint operation with the California-based Scripps Institution of Oceanography. Shaped like a shark, it has a wing on each side and a vertical tail fin.

Six other gliders are at work in the Gulf.

Breck Owens, at WHOI, programmed Spray to stay in the water for four months and search for underwater plumes of oil. It can dive to 500 metres, and uses acoustic equipment to sense particles suspended in the water.

The glider also has an antennae embedded in a wing tip and sends data to Owens and Scripps in real time, via email. Owens can send new instructions to the glider on a satellite phone.

“We should take advantage of this opportunity to evolve a proper observing system in the Gulf,” Owens said at a WHOI conference.

The glider’s data made clear in June that the Loop Current, the movement of warm ocean water into and out of the Gulf, had formed an eddy, and that the oil in the Gulf would likely not travel up the eastern coast of the United States.

The WHOI scientists are analysing their data now and expect to release their results within a few weeks.

This information can be used to determine how successful the cleanup has been, and what should still be done during this spill and others in the future, Reddy said.

But not all scientists need to use high tech to get the answers they are after. Alexander Kolker, a wetlands expert with the Louisiana Universities Marine Consortium, is studying the impact of the spill on a 3,000-square-km area along the southern Louisiana coast called Barataria Bay.

He gathers water samples and sediment cores from the marsh using his small motorboat and hauls them back to his lab for analysis.

“It’s an incredibly productive ecosystem,” he told Tierramérica, noting that it serves as habitat for hundreds of species. Oil from the BP spill covers part of the marsh, but the damage it has caused is not as great as the constant die- off of grass there as a result of salt water intrusion, he said.

The U.S. government agencies overseeing the Gulf cleanup released a report recently that offered a rosy picture of the fate of the oil following the spill.

“It’s important to point out that at least 50 percent of the oil that was released is now completely gone from the system. And most of the remainder is degrading rapidly or is being removed from the beaches,” Jane Lubchenco, head of the National Oceanic and Atmospheric Administration, said of the report.

But Reddy, like many independent scientists, believes it is too early to draw conclusions about the fate of oil in the Gulf. “Why rush? Let’s wait and get all the good data that’s out there,” he said.

(*This story was originally published by Latin American newspapers that are part of the Tierramérica network. Tierramérica is a specialised news service produced by IPS with the backing of the United Nations Development Programme, United Nations Environment Programme and the World Bank.)

Excerpt:

By Adrianne Appel
BOSTON, Jul 9 2010 (IPS)

Times are tough for workers in the U.S. where a recession has a stranglehold on much of the economy, but life is perfectly rosy for those at the top.

The riches of the wealthiest North Americans grew by double digits in 2009, primarily from interest their money earned when it was invested in the stock market and elsewhere, according to a report by the Boston Consulting Group.

Millionaires in the U.S. and Canada saw their wealth increase 15 percent in 2009, to a total of 4.6 trillion dollars, the report found.

Worldwide, 11 million – or less than 1 percent of all households – were millionaires in 2009. They owned about 38 percent of the world’s wealth or 111 trillion dollars, up from about 36 percent in 2008, according to Boston Consulting Group.

About 4.7 million millionaires live in the U.S., four percent of the population and more than anywhere else in the world. Japan, China, Britain and Germany followed the U.S. in the number of millionaires.

Their fortune is a stark contrast to the lives of more than 15 million people in the U.S. who are unemployed and searching for work, and the eight million more who are just getting by with a part-time job, according to the U.S. Bureau of Labor Statistics. More than two million more people were working prior to the recession but have now dropped out of the labour force.

Apart from the newly unemployed, about 39 million people in the U.S. are chronically poor and do not have enough food to eat, according to the U.S. Census and U.S. Department of Agriculture.

“The nation’s jobs crisis is so catastrophic that, unless Congress acts on the scale of the New Deal, millions of Americans will experience extremely long periods of unemployment for many years ahead,” Lawrence Mishel, president of the Economic Policy Institute, told a panel of the Committee on Ways and Means recently.

Not so for millionaires and the uber-rich.

The uber-rich, those with more than 30 million dollars, are on the rebound. They spent more money in 2009 on fancy cars, yachts and jets compared to 2008, according to a study by Merrill Lynch-Capgemini. They bought fine art, expensive jewelry, gems and antiques, items that are likely to increase in value over time, so they can sell them later and make more money.

The recession isn’t hitting those at the top as it has workers. In fact, many wealthy people benefited from the stock market’s ups and downs, said Mike Lapham, director of the Responsible Wealth Project at United for a Fair Economy, an NGO in Boston.

“Folks at the top have a cushion, a disposable income to fall back on. Maybe their portfolios took a hit but they didn’t lose their jobs and their homes. If they had losses, they can deduct them from their taxes,” Lapham told IPS.

“Some people bet successfully on the financial system going under,” he said. “The stock market went from 10,000 to 6,000 and back to 11,000. That’s a big jump for people with significant portfolios.”

“The people at bottom who’ve lost work, it’ll be years before they get back to where they were before the crash,” Lapham said.

The U.S. average national unemployment rate is 9.7 percent. Only those who are actively looking for work are included in this statistic. Among Black Americans, the rate is 15.5 percent and Latinos, 12.4 percent, according to the Bureau of Labor Statistics.

The Congressional Budget Office predicts that unemployment will remain almost unchanged in 2011, about 9.5 percent.

Many families have been surviving on small, weekly unemployment checks provided for 26 weeks by their state government, and an additional 73 weeks by the federal government. The first group of unemployed to run through both benefits hit that point Jul. 1, and today about a million people are receiving no assistance at all. About nine million more are still receiving unemployment payments.

Congress is considering extending federal assistance for another 20 weeks. The House approved the legislation, but the Senate did not. Congress left town for its holiday break until mid-July without passing the legislation.

In the Senate the issue fell almost precisely along party lines, with all but one Democrat for extending the benefit, and all but two Republicans against it, saying the 34- billion-dollar cost was not worth adding to the federal deficit.

Without the vote of Democratic Senator Ben Nelson, of Nebraska, the bill was one vote short of the 60 needed for passage.

“I think we’re going to see a new wave of heartache here in Rhode Island,” with the end of the federal assistance, Kate Brewster, executive director of the Poverty Institute, a Rhode Island NGO, told IPS.

The small, northeastern U.S. state, a former manufacturing centre whose jobs moved offshore, has struggled with higher unemployment and low-wage jobs for years. Most recently, it was hard hit by the foreclosure crisis and the downturn in the construction industry.

The ongoing unemployment and low jobs creation nationwide is helping to fuel the millions of foreclosures sweeping across the nation, according to a report by the Harvard University Joint Center for Housing Studies.

The nation’s anemic jobs creation, high foreclosures and weak consumer spending has convinced Mishel and many economists that the U.S. is in for an extended downturn. Just 83,000 jobs were created in June, instead of the 150,000 needed for robust employment, according to the U.S. Labor Department.

“The United States is undergoing the worst economic downturn in 70 years, and the damage and suffering it is causing will last many years beyond the official end of the recession,” Mishel said.

Rhode Island’s future is uncertain.

“We’ve consistently had one of the highest rates of unemployment in the country,” Brewster said. Today, in the midst of the recession, more people are showing up at soup kitchens for free meals and dialing in to a toll-free, crisis phone service for families in dire circumstances, she said.

“They’ve had an enormous influx of calls in the past 18 to 21 months,” she said. Fewer services are available to help them.

“Within last five years the state cut back work support programmes like child care assistance and funded health insurance,” Brewster said. “The cruel irony is that when families really need help, less is available.”

Excerpt:

A crisis of foreclosures is twisting through neighbourhood after neighbourhood here, separating thousands of U.S. families from their homes each day and further unraveling the social fabric of low-income communities.

More than 932,000 foreclosure filings were made through April 2010, on top of 2.8 million in 2009. Credit: respres/creative commons license

Wall Street is well on its way toward recovering from its near-collapse almost two years ago, but thousands of U.S. properties sit abandoned and boarded up that were once homes where families lived.

Government programmes that are supposed to help families in foreclosure are not working, watchdogs say. In fact, the foreclosure crisis may be worsening.

The 50-billion-dollar Making Home Affordable Programme “risks being remembered not for catalysing a recovery from our current housing crisis, but rather for bold announcements, modest goals, and meagre results”, Kevin Puvalowski, deputy special inspector general for TARP, the U.S. Treasury’s bailout programme, told a Senate Appropriations panel recently.

Because of bad loans, falling housing prices, a 9.7 percent average nationwide unemployment rate and high family debt, more than six million families were 60 or more days delinquent on their home loans as of February 2010, according to the Congressional Oversight Panel, a group appointed by the U.S. Senate to track Treasury Department programmes.

More than 932,000 foreclosure filings were made through April of this year, on top of 2.8 million in 2009, according to RealtyTrac, a commercial marketer of foreclosed homes. The first quarter of 2010 saw a 16 percent increase in foreclosures compared to the same time in 2009, records show.

The high number of foreclosures rings true in Boston, said Steve Meacham, director of tenant organising at City Life/Vida Urbana, a housing advocacy non-profit.

“Our meetings continue to be huge,” Meacham told IPS. An average of 100 people facing foreclosure attend the group’s sessions each week, to learn ways to stay in their homes when facing foreclosure.

City Life and its supporters engage in direct civil disobedience, protesting at bank headquarters in Boston and peaceably facing off with police who arrive at a home to evict a family due to foreclosure, by linking arms and preventing the police from entering the house.

“The stakes for the families are very high. When you do an eviction blockade, you have 15 police and the constable, and protesters sitting in the doorway. It’s very emotional, whether you win or lose,” Meacham said.

The group’s actions have unexpectedly grown into a grassroots movement that is strengthening the low-income, Dorchester section of Boston, Meacham said.

“Many people who’ve never done activism come out and do civil disobedience,” he said.

The highly questionable, predatory refinancing loans with unfair terms and high interest rates were aimed at African American and Latino homeowners. More than 80 percent of those at City Life’s meetings are people of colour. The growing activism around evictions can be likened to the anti-segregation protests of the 1960s, Meacham said.

“More than anything I’ve ever been involved in, the growth of the movement and solidarity is just a remarkable, remarkable thing. It’s been created in the midst of tragedy,” Meacham said.

The foreclosures are due to very high interest predatory loans and falling house values, and also job loss, illness or divorce, Meacham said. The banks evict families and the homes often sit empty and boarded up, a loss to the bank and the entire community.

“The untold story is that a whole lot of people who have lost homes can afford to stay where they are,” if the banks were more reasonable, he said. Many families can afford to pay market-rate rent to the bank, or buy the house back at what it’s really worth today, not the higher values of four years ago, he said.

Tisa Taylor knows about foreclosure. She and her father, Zepheniah, bought a three-family house in Dorchester in 1999. She and her two children live in one apartment, her father in the other, and they rent out the third floor. Everything was fine until 2006, when the interest rate on a refinancing loan the family had borrowed two years earlier suddenly began to climb.

“It was supposed to be a 30-year fixed mortgage but payments went from 2,100 dollars a month to 3,500 dollars. We were tricked,” Taylor told IPS. The loan holder, Ameriquest, refused to negotiate, she said.

“They took us to court in 2007 and said we had to move out. It was horrible,” she said. Zephaniah, who came to the U.S. from Jamaica 30 years ago and worked steadily to buy a home, had a stroke because of the stress. “He gave us everything,” she said.

After a long court battle and help from City Life, the family is back in their home today, and Tisa is a loyal City Life advocate. She joins eviction and foreclosure protests in her neighbourhood. “Anything they ask me, I do,” she said.

The NAACP has sued 14 of the nation’s largest financial institutions, including JPMorgan Chase, Citibank and HSBC, over allegations of unfair lending practices that targeted people of colour specifically.

The foreclosure crisis is also leaving behind hundreds of thousands of abandoned residential and commercial properties in U.S. cities. An annual survey of the U.S. Conference of Mayors found the number of abandoned properties increased 33 percent over last year in the 77 cities surveyed.

The properties are a financial strain on the cities, which have seen revenues drop in the economic downturn, U.S. Conference of Mayors CEO Tom Cochran said.

The properties “represent increased demands for services to maintain them physically, to secure them, to rehabilitate them as needed, to get them into the hands of new owners, or to dispose of them in other ways”, Cochran said.

The boarded up buildings invite crime and further depress neighbourhood home values, Meacham said.

“Social decay is caused by the displacement after foreclosure. If you can stop the displacement, you stop the decay,” he said.

By Adrianne Appel
BOSTON, Jun 13 2010 (IPS)

A radical, underground movement is growing in the suburbs of the United States.

Homeowners, corporations and schools are catching on to the idea of creating a wild space where nature can thrive. Credit: Adrianne Appel/IPS

“It’s a growing endeavour. It gets bigger and bigger every year,” said Steven Saffier, coordinator of the Audubon Society’s At Home programme, which encourages people to let their lawns go wild to support birds and other wildlife.

The lawn, the one-third acre or more of trimmed grass outside the front door of so many U.S. homes, is getting an eco-makeover as people learn about the lawn’s impact on the larger environment.

Groups as diverse as urban garden clubs, environmental groups and wildlife protection groups are spreading the word that a big, lush lawn harms biodiversity and is an eco- disaster.

“Lawns contribute to climate change,” Saffier told IPS. “The fossil fuels used in fertiliser and pesticide production add CO2 to the environment.”

Lawns in the U.S. are grown mostly from non-native grasses that require large amounts of water, pesticides and fertilisers. Many homeowners aim for perfection, considered a dark green mat of closely-mown grass without weeds, a look promoted by chemical and fertiliser manufacturers here.

But homeowners, corporations and schools are starting to catch on to the idea of creating a wild space where nature can thrive.

Last week, Saffier helped dig a garden with a native spice bush plant at a Pennsylvania school. The group had barely covered the roots of the plant with dirt when a swallowtail butterfly landed on a leaf and laid her eggs.

“That’s the kind of thing we are going for, on a larger scale,” Saffier said.

What happens on individual lawns is multiplied many times over, because more U.S. surface area is devoted to lawns than any other irrigated crop, according to an analysis by the National Aeronautics and Space Administration (NASA).

The Lawn Institute, which represents the 35-billion-dollar per year turf industry, estimates that 25 million acres of lawn are growing in the U.S. This land previously hosted native trees, shrubs and grasses and entire ecosystems, but not anymore.

“The nutrient, hydrology and nitrogen cycles that happen naturally in biodiverse ecosystems are completely absent in lawns,” Saffier said.

These acres of contiguous lawn have contributed to the severe decline in the U.S. bird population, Saffier said.

“The lawn is a landscape that offers nothing to the bird,” he said.

Ninety-six percent of birds eat mainly insects, like caterpillars and bugs, and these insects are highly specialised and eat just one, two or three types of native plants.

“The birds won’t find insects on the lawn,” Saffier said. Fewer caterpillars mean birds do not have enough food to feed their young.

Of the 800 major bird species in the U.S., 200 are in dangerous decline, Audubon says. Populations of meadow larks and other grassland species in the mid-western U.S. have plummeted 60 percent, while interior forest birds, like scarlet tanagers, have also seen a precipitous decline.

Shrub land bird species, like the Brown Thrasher and Eastern Towhee, have decreased 75 percent since 1966, according to the North American Breeding Bird Survey, of the U.S. Geological Survey and Environment Canada.

Bird populations are doubly harmed when lawns are sprayed with pesticides and herbicides.

“It only takes a trace amount of chemicals on insects or plants to impact birds. Birds have very sensitive nervous systems,” Saffier said.

Of the 30 most common pesticides used on lawns, more than half are toxic to birds and fish, and linked to cancer and birth defects in humans, according to the environmental group, Beyond Pesticides. Eleven of the 30 are endocrine disrupters, chemicals that interfere with reproductive and other hormones in humans and animals.

Lawns and gardens are sprayed with more pesticides per acre than farmland, with weed killer the most used yard chemical, at 90 million pounds per year. About 78 million U.S. households spray pesticides on their yards each year, according to Beyond Pesticides.

Lawn grasses tend to shed rainwater, so the chemicals run off into surface and groundwater after a downpour, increasing the chance that animals as well as humans will be exposed to them, John Kepner, project director of Beyond Pesticides, told IPS.

“Children are the most vulnerable,” he said.

Lawns were originally a flagrant display of European wealth, a sign that a household was rich enough to devote land to grass rather than food.

They remain a status symbol today, says Julian Agyeman, chair of Urban and Environmental Policy and Planning at Tufts University.

“The paradigm is that you should have a lawn at any cost, even if you can’t afford it,” Agyeman told IPS.

Millions of U.S. poor can’t afford homes and lawns – and sometimes not even enough food – and are hired, often at low wages, to mow and spray chemicals on the lawns of the wealthy.

“Adding insult to injury, the poor can’t afford a lawn and then end up caring for the lawns of those that can,” Agyeman said.

Food Not Lawns, a group with chapters in many U.S. communities, works with people who are ready to completely let go of the lawn as status symbol.

“We call it lawn eradification,” Steve Mann, co-founder of Food Not Lawns Kansas City, Missouri, told IPS.

Instead of turf, people are encouraged to grow fruit and nut trees, like pecans, walnuts and almonds, as well as vegetables. Since 2007, 250 people have consulted with the group.

The group is seeking zoning changes from the city so neighbours can sell their extra garden produce, and hire others to help them. They’ve encountered surprising opposition from local realtors.

“Just think, you could pick up some fresh lettuce and tomatoes for your dinner right down the street. What’s wrong with that?” Mann said.

The opportunity for gardens in Kansas City is endless, given the amount of lawn space. “My god, people here have acres of it,” Mann said.

Penny Lewis, executive director of the Ecological Landscaping Association, a group of professionals and homeowners, told IPS the lawn paradigm must change.

“Rather than the status symbol being the picture-perfect lawn, it becomes the eco-friendly lawn,” she said.

*This story is part of a series of features on biodiversity by Inter Press Service (IPS), CGIAR/Biodiversity International, International Federation of Environmental Journalists (IFEJ), and the United Nations Environment Programme/Convention on Biological Diversity (UNEP/CBD) — all members of the Alliance of Communicators for Sustainable Development (www.complusalliance.org).

Excerpt:

By Adrianne Appel
BOSTON, Dec 6 2009 (IPS)

As the U.S. climate delegation arrives in Copenhagen nearly empty-handed, watchdog groups back at home say they know why: a political system gone astray due to the influence of huge amounts of corporate cash.

“The bottom line is our method of private financing of campaigns is a disaster,” Tyson Slocum, director of energy at Public Citizen, an NGO, told IPS.

From the start of a congressional campaign, to the drafting of legislation, to the launching of an ex-congressman’s, lucrative lobbying career, big business is at work, they say.

“The special interests pay for our political campaigns. They in a sense are buying access,” Mary Boyle, spokesperson for Common Cause, told IPS.

“They have a very strong voice and a very strong role in setting our political agenda,” said Boyle, whose group is proposing an overhaul.

Among corporations with influence in the U.S. Congress, oil and gas companies wield particular power, and they came out in force to shape the climate bill that passed the House in June.

That bill proposes reducing U.S. carbon emissions 17 percent below 2005 levels by 2020. This is roughly four percent below 1990 levels, not the 40 percent reduction called for to keep the planet from warming 2 C. A similar measure is sitting before the Senate.

President Barack Obama, expected in Copenhagen on the final day of the climate talks, said the U.S. will rely on the 17 percent formula as a starting point for negotiations at Cop15.

“There are thousands of corporate lobbyists courting [Congress], way outnumbering our side. What we ended up with is a climate bill that is more of an industry-friendly bill,” Kert Davies, research director at Greenpeace U.S.A., told IPS.

The next election isn’t until Nov. 2010 but oil and gas special interests are already giving campaign cash to members of Congress. Since Jan. 1, 2009 these industries have handed out 4.4 million dollars.

Chevron has given the most campaign cash, 328,000 dollars, followed by Koch, which owns the Koch Petroleum Group, at 308,000 dollars, Valero Industry at 289,000 dollars, and Exxon Mobil at 273,000 dollars.

“Seven of the 10 largest corporations in the world are oil companies, based on revenues. Their cash on hand gives them a huge voice in the political system in the U.S.,” oil industry expert Antonia Juhasz told IPS.

Serious candidates have little choice but to accept the cash, because campaigns are too expensive for voters alone to sustain. In 2008, the average winning House candidate spent 1.4 million dollars during the campaign, while a Senate seat “cost” 8.5 million dollars, according to analyses by the Center for Responsive Politics, an NGO.

“BT and Shell don’t have as great influence in Europe as in the U.S. We need help from the world, for the world to say to us, ‘You have to change your climate policy,”‘ Juhasz said.

Oil and gas special interests are targeting their cash to legislators who have jurisdiction over energy-related legislation, like the climate bill before the Senate.

Sen. Blanche Lincoln, a Democrat on the Energy and Natural Resources Committee, took 210,000 dollars in oil and gas cash this year. Sen. David Vitter, a Republican on the Committee on Environment and Public Works accepted 157,000 dollars, and Sen. Lisa Murkowski took 139,000 dollars. Murkowski is the lead Republican on the Energy and Natural Resources Committee.

The oil and gas special interests who are financing lawmakers’ re-elections next year are also sending lobbyists to the lawmakers’ offices to convince them to include or exclude provisions of the climate bill, and other legislation of interest to them.

To a lawmaker, “their presence is a constant reminder of how much the industry will fight against you in the next election, or support you in the next election. The oil industry says, ‘This is the bill you have to follow. You are going to follow our position on this or you will face our opposition’,” said Juhasz, a former congressional aide.

The lobbyists fund raise for the lawmakers, raising huge amounts of corporate-insider cash for the next election, Boyle said.

“They are raising money from all their corporate friends and colleagues,” Boyle said.

Oil and gas companies spent 121 million dollars to dispatch 745 lobbyists to Congress between Jan. 1, 2009 and Oct. 26. They also poured money into the U.S. Chamber of Commerce, which has increasingly lobbied on behalf of oil interests, on the climate bill and other legislation, Juhasz said.

BP America spent 11.3 million dollars, Chevron spent 15.5 million dollars, ConocoPhilips spent 13.2 million dollars and Exxon Mobil 20 million dollars, among dozens of gas and oil companies that have lobbied so far in 2009. Last year, Exxon Mobil spent 29 million dollars lobbying Congress. Electric power companies spent 108 million so far this year, while the coal industry spent 10 million.

“The oil industry is unified in its opposition to the climate legislation. The [American Petroleum Institute], led by Exxon Mobil, has played a key role in trying to influence Congress, embarking on a very sophisticated Astroturf campaign and discrediting the signs of climate change,” Slocum said.

“The special interests have gotten hold of the bills, and the bills give away tens of thousands of dollars to polluters,” Slocum said. “This is not an effective strategy for climate change,” he said.

A ray of hope is that the Obama administration, through the Environmental Protection Agency and its Clean Air Act, has the authority to sharply reduce the emission of some greenhouse gases, without the approval of Congress, Slocum said.

The climate bill that passed the House, however, attempts to limit the Environmental Protection Agency’s authority, in a clear giveaway to industry, Slocum said. The bill will not become law unless approved by the full Congress, next year.

An analysis by the Center for Public Integrity, a non-profit journalism centre, found that the number of special interests lobbying Congress surged from 880 entities to 1,150 as the House took up debate on the climate bill in spring ’09. The groups lobbying were very diverse, from food associations, to clothes manufacturers to religious organisations, it found.

Corporate and special interests spent a total 2.5 billion dollars lobbying members of the U.S. Congress during the first nine months of 2009, says the Center for Responsive Politics.

Many lobbyists are former federal officials or former members of Congress. Lisa Barry, for example, is a former deputy assistant secretary at the U.S. Department of Commerce. Today she lobbies for Chevron, according to the Center for Responsive Politics.

Vic Fazio, a former Congressman, now lobbies for Royal Dutch Shell and other corporations.

Patrick Von Bargen was a chief of staff to Democrat Sen. Jeff Bingaman, chair of the Energy and Natural Resources Committee. Von Bargen is a lobbyist for the American Coalition for Clean Coal Electricity, through the firm Quinn, Gillespie and Assoc. The QGA firm was co-founded by Jack Quinn, former legal advisor to Pres. Bill Clinton, and chief of staff to Vice President Al Gore.

The QGA firm spent 260,000 dollars lobbying on behalf of the American Coalition for Clean Coal Electricity, an industry group known for its non-stop television ads promoting coal, and its back-door campaigns against greenhouse gas regulation.

“Patrick provides strategic counsel to QGA’s energy clients representing the coal and electricity industries as well as startup firms using venture capital to develop clean energy technology. He has an acute understanding of the various, complex aspects of the new public policy proposals that will shape the nation’s energy future,” the QGA website brags.

At last count, 321 former members of Congress and staff now make their living as lobbyists, according to the Center for Responsive Politics.

“The fact that we still have an energy system based on fossil fuels and haven’t transitioned to alternative fuels is due to the fact that there is a huge fossil fuel lobby in the United States. It has kept us from going down a path that is more sustainable and climate friendly, and in the interest of national security,” Nick Nyhart, president of Public Campaign, told IPS.

Excerpt:

By Adrianne Appel
BOSTON, Oct 30 2009 (IPS)

Big banks will not be forced to downsize and the public will be the last to know when they fail, a controversial bill unveiled by U.S. Treasury Secretary Timothy Geithner and Congressman Barney Frank proposes.

The long-awaited “too big to fail” legislation was roundly criticised during a congressional hearing Thursday as a nod to the biggest financial firms in the U.S.

“This is TARP on steroids,” said Rep. Brad Sherman, a Democrat, referring to the U.S. Treasury programme that gave trillions to financial companies.

The legislation was called for by Congress and President Barack Obama in the wake of the trillions recently spent by the U.S. government to rescue behemoth financial institutions like AIG and Bank of America, out of fear that their failure would bring down the whole financial system.

“Taxpayers simply must not be put in the position of paying for losses incurred by private institutions,” Obama said in a letter to Frank this week praising the legislation. “When major financial firms fail, government must have the ability to dissolve them in an orderly way, with losses absorbed by equity holders and creditors.”

Leading up to the bill, many economists on the left and the right said the only way to protect the finance system and consumers is to break up the gargantuan finance companies that now exist. Former Federal Reserve chairmen Paul Volker and Alan Greenspan, and former labour secretary Robert Reich all favour this approach.

As a result of the mergers and acquisitions during the past 18 months, Bank of America, CitiGroup and J.P. Morgan Chase now control about one-third of U.S. finance and bank business, analysts say.

“The Wall Street giants should be split up – and soon,” Reich said.

But the bill does not propose breakups, and instead takes a more “subtle” approach, current Federal Reserve Chairman Ben Bernanke told reporters.

Reich says this is a mistake. U. S. Treasury Secretary Timothy Geithner and financial advisor Lawrence Summers “continue to bend over backwards to make Wall Street happy, and in doing so continue to risk the credibility of the president, as well as the long-term financial stability of the system,” Reich said.

The bill probably will not be sorted out in time for the next round of bailouts. GMAC, the former financial arm of General Motors, is in line for its third government handout and CitiGroup is reportedly still on shaky ground. GMAC has already received 12.5 billion dollars from Uncle Sam and CitiGroup, 45 billion dollars.

GMAC, like other businesses, made itself eligible for a government bailout by purchasing a bank last year, and becoming a bank holding company.

The bill was criticised at a Thursday hearing by Frank’s House Finance and Banking Committee, by Democrats and Republicans, and even an Obama administration official.

Sherman said the bill would grant the Federal Reserve and U.S. Treasury the authority to bail out institutions in unlimited amounts without the approval of Congress.

“We are given no authority to limit the biggest institutions but we are allowed to help them when they fail?” said Democrat Rep. Paul Kanjorski, calling for the bill to allow downsizing of big financial firms.

Under the bill, sprawling bank-holding companies would continue business as usual, unless in trouble. The bill would not allow any new bank holding companies to be created.

A new government oversight council, led by the Treasury secretary, would watch for danger signs in the finance system as a whole, and identify firms at risk of failure, referred to as “the list” by Frank. The firms would be subject to heightened regulation, and monitored closely by the Federal Reserve. Investors and other business parties, and possibly Congress, would be alerted to firms on “the list”, but not the public.

“Even a cursory reading shows that the administration has chosen to continue its failed policy of costly taxpayer bailouts orchestrated behind closed doors by officials at the Treasury and the Federal Reserve,” said Republican Rep. Spencer Bachus.

“The legislation keeps the names of the ‘too big to fail’ firms secret. It allows the picking of winners and losers behind closed doors,” said Republican Rep. Randy Neugebauer.

If a firm fails and can’t pay back its loan, the FDIC would step in and attempt to dismantle it in an orderly way, outside of bankruptcy. Solvent firms of 10 billion dollars or greater would be assessed a tax to pay for the cost of the failed institution.

Sheila Bair, chief of the Federal Deposit Insurance Corporation, the entity that regulates community banks, criticised the bill.

“The oversight council described in the proposal currently lacks sufficient authority to effectively address systemic risks,” Bair said at the hearing. It should be led by a presidential appointee, not the Treasury secretary, she said.

A very controversial part of the bill is the authority that would be granted to the Federal Reserve to act apart from the council and Congress, and to bail out troubled firms or solvent firms with unlimited amounts of U.S. government funds, with quiet approval from the Treasury.

The Federal Reserve is a quasi-government entity, that helps direct U.S. monetary policy but is governed by its members – private banks and financial firms. It operates with great secrecy, and is not required to disclose the loans it makes to firms, estimated to be in the trillions during the past two years.

Americans for Financial Reform, a broad coalition of labour and consumer organisations, opposes the bill because of the greater autonomy granted to the Fed, Richard Trumka, president of AFL-CIO trade union, told Frank. The Fed was in charge during the meltdown of the past 18 months, Trumka said.

“Instead of repeating and deepening the mistakes associated with the bank bailout, Congress should be looking to create transparent, fully publicly accountable mechanisms for regulating systemic risk and for acting to protect our economy in any future financial crises,” Trumka said.

The committee may vote on the bill next week, though no similar legislation has yet been drafted in the Senate.

Excerpt:

By Adrianne Appel
MILWAUKEE, Wisconsin, Oct 22 2009 (IPS)

The weather was right for swimming this summer along the shores of Lake Michigan, but on many days, the only living things seen on the beach were gulls, picking away at zebra mussels ensnared in a thick, green slime that covered every rock, pebble and grain of sand for miles.

Scientists aboard the Lake Guardian research vessel prepare to sample water from Lake Michigan. Credit: Adrianne Appel/IPS

Scientists so far haven’t found the reason for Cladophora’s overgrowth. The lake is under such profound environmental stress that any of a number of factors, alone or together, could be the cause, they say.

“It’s easy to see what’s happening. It’s difficult to understand why,” J. Val Klump, director of the Great Lakes WATER (Wisconsin Aquatic Technology and Environmental Research) Institute, told IPS.

Top suspects are climate change, which has raised the lake’s temperature and lowered water levels, and the widespread, sinister changes in the lake’s ecosystem wrought by alien zebra and quagga mussels that now cover the lake bottom by the millions.

“These systems are very sensitive to climate change,” Klump said.

This isn’t the first time Cladophora, whose growth is fueled by phosphorus and other nutrients, changed into a nuisance plant. It also overgrew in the 1960s and ’70s until excess phosphorus pouring into the lake was halted, a byproduct of industry and household products. With phosphorus under control, the Cladophora had been too, until about five years ago.

“Something has changed,” Paul Horvatin, the federal Environmental Protection Agency’s Great Lakes monitoring director, told IPS while onboard The Guardian research vessel on Lake Michigan.

The Barack Obama administration has pledged to provide five billion dollars over 10 years for the ailing Great Lakes, and part of the first installment of 475 million dollars will be used to research invasives, Horvatin said.

The five Great Lakes extend across 244,000 square kilometres that straddle the U.S. and Canada, just 2,400 kilometres from the polar ice cap. The lakes support shipping to the Atlantic Ocean, and some of the richest commercial fisheries in the world. About 40 million people take their drinking water from the Great Lakes.

At the same time, the lakes are massively polluted with chemicals and heavy metals, particularly the bottom sediment, after hundreds of years of industrialisation. The lakes are closed systems, and they hold onto pollutants. Forty-three Great Lake harbours are considered highly toxic waste sites.

“The good news is we are seeing a decline in PCBs and DDT. The bad news is they haven’t declined enough,” Horvatin said.

Even today, large quantities of sewage flow from urban areas like Milwaukee into Lake Michigan during very heavy rains from overwhelmed storm drains. Thirty percent of Milwaukee storm water pipes test positive for human fecal contamination on a normal day, Klump said.

Incidents of sewage overflow into the lakes are increasing, as climate change brings more days of torrential rains to the Midwest, according to the Nelson Institute at the University of Wisconsin. The Midwest is warming overall, with more extreme hot days in summer, warmer winters with less snow and less ice on the Great Lakes.

According to the Great Lakes WATER Institute, winters in Wisconsin, which borders Lake Michigan, are now four degrees F warmer than before 1980.

As soon as 2030, the amount of spring snow pack would be halved, and Lake Michigan could be devoid of ice for much of the winter, according to models of the National Oceanic and Atmospheric Administration.

Lake Michigan water is already 58 centimetres below normal, near its lowest recorded level, because of evaporation from summer heat, according to the Nelson Institute.

Lake Superior was typically covered 60 percent with ice for most of the winter but today 20 percent is the norm, Klump said.

“The bottom line is by the mid to end of the century, we will be in a different climate zone,” Klump said. The Midwest climate will be like that of the more southern U.S. state of Arkansas, he said.

According to Brian Shuter, a zoologist with the Ontario Ministry of Natural Resources, these changes may cause cold-water fish, like salmon, lake trout and brook trout, to move north, and warm-water fish like carp and catfish to move in.

Today, the native Karner blue butterfly, an endangered species that thrives in the natural habitat of Indiana Dunes National Park, on the southern tip of Lake Michigan, is in trouble, according to the Union of Concerned Scientists. Snow insulates the butterfly’s eggs from the freezing winters but fewer are surviving now because there is less snow.

The temperature, water level and other changes to Lake Michigan have created the perfect habitat for aggressive new species like the hybrid cattail to replace sedge meadows that surround Green Bay, one of the richest commercial fisheries in the world, according to research of the Great Lakes WATER Institute.

The zebra and quagga mussels, originally from Russia and Ukraine, are so plentiful in Lake Michigan, they have drastically altered the lake’s ecosystem during the past 19 years.

The mussels are aggressive filter feeders and during the past five years, their filtering has changed the lake’s trademark murky, plankton-rich water – to clear. Light now penetrates into the lake, where it never has before. Divers love the change and so does Cladophora, whose growth is stimulated by light.

As the mussels filter, they excrete concentrated amounts of phosphorus, which also may be encouraging Cladophora growth. Quagga mussels excrete even more phosphorus as temperatures rise, as has been happening in Lake Michigan, Harvey Bootsma, a scientist at the Great Lakes Water Institute said.

Plankton are a rich food source for many native fish. With large quantities of it being taken up by the mussels, “The fish are getting skinny,” Bootsma told IPS.

Anyone near a Cladophora-clogged beach can tell something isn’t right with Lake Michigan.

“When the stuff decomposes it smells like a pig barn,” Bootsma said.

And that’s not all. The heaps of dead algae on the beach threaten the quality of the water.

Mounds of dead Cladophora wash up on beaches with zebra mussels attached. Gulls and other birds stroll over the algae, eating the mussels and depositing fecal material with high concentrations of toxic e. coli bacteria. The whole mess rots in the sun and stinks, and the bacteria contaminates the water, Bootsma said.

Birds are suffering, too. In 2007, more than 17,000 birds died from botulism, which normally lives harmlessly in small quantities in lake sand but is concentrated by the mussels, Horvatin said.

He and other researchers hope to answers soon.

“We’re trying to look at the whole food chain and how it has changed over time,” he said.

*This story is part of a series of features on sustainable development by IPS and IFEJ – International Federation of Environmental Journalists­ for Communicators for Sustainable Development (www.complusalliance.org).

Excerpt:

By Adrianne Appel
BOSTON, U.S., Oct 6 2009 (IPS)

While world leaders banter about International Monetary Fund and World Bank business in Istanbul, NGOs critical of the way the Bretton Woods institutions operate are not letting up pressure.

The IMF needs to change its policies, not just its rhetoric, said Conny Reuter, secretary general of SOLIDAR, a European civil society network working to advance social justice.

Along with Eurodad and the Global Network, which together represent more than 100 NGOs in Europe, SOLIDAR released a report Monday describing harm to El Salvador, Ethiopia and Latvia as a result of conditions the IMF imposed when it made emergency loans to these nations.

Meanwhile, an economic think tank in the U.S. says it has hard evidence that of IMF agreements in 42 nations, 31 have resulted in harm to those countries.

IMF loan terms represent “policy mistakes” that should be fixed, according to Mark Weisbrot, co-director of the Centre for Economic and Policy Research in Washington.

“More than a decade after the Asian economic crisis brought world attention to major IMF policy mistakes, the IMF is still making similar mistakes in many countries,” Weisbrot said.

The studies add to a laundry list of criticisms by nations, NGOs and think tanks of IMF loans and the austerity measures that often accompany them.

“You have a double standard. Wealthy nations are saying, ‘We are in an economic crisis so we’re going to spend more, increase our deficits and stimulate the economy.’ But the IMF is telling poorer nations the opposite, to increase interest rates and cut spending,” Neil Watkins, executive director of Jubilee USA, told IPS.

“That means your health care, education and social spending is going to be impacted, and if interest rates are high, businesses can’t get credit,” he said. “Why is the IMF delivering assistance in the form of loans, when poor nations need debt relief and grants?”

The global recession has further stressed nations that are trying to meet their IMF loan terms, Reuter said.

“This crisis has just shown that world economic growth is based on rotten foundations. The recovery must be built on more solid foundations, with the IMF using its huge increase in financial resources in a way which allows countries to support decent work, reduce inequality and eradicate poverty,” Reuter said.

The IMF, which includes 186 member nations, is in the midst of some transformations. Recently, the G20 group of wealthiest nations announced it was moving into the role previously held by the G8, as the major international body that plans and funds global economic initiatives.

The G20 leaders have said they would funnel 750 billion dollars in new funds through the IMF to assist low- and middle-income nations. So far, there is no sign of change, the European NGOs say.

U.S. Treasury Secretary Timothy Geithner told IMF members in Istanbul: “The Obama administration is strongly committed to a renewed focus on multilateralism in the delivery of development assistance and will be working to ensure that the multilateral development banks have adequate resources, sound policies, and good governance, so that they are well positioned to meet current and future development needs.”

However, Reuter’s report notes that, “Experience so far indicates that the IMF is still imposing inappropriate, pro-cyclical conditions on many borrowers. These may unnecessarily exacerbate economic downturns in a number of countries.”

The CEPR agrees, and says the IMF’s overall fiscal policy toward developing nations should change to encourage long-term, stable growth, rather than continuing to focus on loans aimed at easing short-term, day-to-day operating funds.

According to CEPR, the IMF’s loan terms did not take into consideration the global fiscal slowdown which hit hard in 2007 and was foreseeable going back to 2002.

“IMF supports fiscal stimulus and expansionary policies in the rich countries, but has a much different attitude toward low-and-middle income countries,” Weisbrot said.

IMF chief Dominique Strauss-Kahn told reporters this week that global economic growth would likely reach a healthier 3.1 percent in 2010. While improving, the world economy is not robust and low-income nations will continue to be hit hard, he said.

According to the World Bank, private capital flowing into developing nations dropped from 1.2 trillion dollars in 2007 to 707 billion dollars by the end of 2008. The bank predicts that 2009 capital inflows will have plummeted further, to just 363 billion dollars.

CEPR praised the IMF’s new Flexible Credit Line as a step toward expansionary policies in low-income nations. But it said the loans have only been available to the middle-income nations of Colombia, Mexico and Poland.

“The next step should be to eliminate harmful conditions attached to other IMF lending facilities,” the report says.

The IMF has one of the largest, most sophisticated economic research centres in the world, so would have had all the necessary information to make accurate predictions about the global economy, the report says.

“The fund should have been more careful in its projections and should have anticipated a severe downturn that would have serious effects on low- and middle-income countries,” CEPR says.

In addition to decreased revenues, many nations saw a rapid increase in the price of basic commodities and oil in 2008, and the IMF did not adjust its loan terms for this added stress, the report says.

These IMF loans show “an underlying bias” by the IMF of making overly restrictive loan terms to developing nations, CEPR says.

After making the loans, the IMF reviewed its terms with 26 nations. The fund found that in 11 nations it had overestimated the gross domestic product (GDP) of those countries by three percentage points, a large amount in economic terms.

The GDP refers to all the goods and services produced within a country and is a conventional way of measuring the fiscal health of a nation. In three nations, the agency found it had overestimated GDP by a whopping seven percentage points, CEPR says.

The result is that the loan payments required of some nations are too high and the austerity measures so severe as to cause internal strife.

Romania, which recently borrowed 20 billion euros from the IMF and other institutions, was required as part of the loan term to cut spending and try and bring its budget into balance. The government has cut salaries and programmes and today there are widespread protests and unrest surrounding the austerity measures.

Similar protests in Haiti, Hungary, Latvia and Republic of Congo convinced IMF to ease its loan terms.

“It is time for the [IMF] to re-examine the criteria, assumptions and economic analysis it uses to prescribe macroeconomic policies in developing countries,” CEPR says.

Excerpt:

By Adrianne Appel
BOSTON, U.S., Oct 5 2009 (IPS)

Economics Nobel laureate Paul Krugman helped unveil a new, lifesaving invention at the 2009 Ig Nobel awards ceremony last week – a pink brassiere that doubles as a pair of filtering gas masks.

Dr. Elena Bodnar demonstrates her gas mask brassiere for a raucous crowd of scientists at Harvard University. Credit: Alexey Eliseev

“For demonstrating that tiny banks can rapidly transform themselves into big banks, and vice versa,” said Marc Abrahams, who founded the Ig ceremony and is the master of ceremonies.

“The winners could not – or would not – be with us tonight,” Abrahams added.

These dubious achievements were two of nine feted at the zany ceremony held annually at Harvard University that pokes fun at questionable scientific research. The Ig winners come from all over the world and travel at their own expense to Harvard to accept the prizes, no doubt because they are handed out by real Nobel laureates like Krugman.

The fashionable gas mask was designed and patented by Elena Bodnar, who noted that bra cups, no matter what the size, are the perfect shape to fit easily over the mouth and nose. Filtering masks could have helped victims of the Chernobyl nuclear disaster, and people near the 2001 attacks on the World Trade Centre in New York City, she said.

“You have to be prepared all the time, at any place, at any moment, and practically every woman wears a bra,” Bodnar said.

“It only takes 25 seconds for any woman to use,” she said. “Five seconds to convert and wear her own mask, and 20 seconds to wonder who the lucky man is to wear the second mask.”

Bodnar gave take-home samples of her invention to Krugman and fellow Nobel laureates Wolfgang Ketterle (Physics 2001) and Orhan Pamuk (Literature 2006), who dutifully demonstrated the device for the raucous audience.

Other Nobel laureates who handed out the Ig prizes included Martin Chalfie (Chemistry 2008), Roy Glauber (Physics 2005), Dudley Herschbach (Chemistry 1986), William Lipscomb (chemistry, 1976), Orhan Pamuk (literature 2006), Rich Roberts (Physiology/Medicine 1993) and Frank Wilczek (physics, 2004). Chalfie was the prize in the “win a date with a Nobel laureate” contest.

The evening’s theme was risk and included a mini-opera that made fun of big banks, and a one-minute keynote speech by scientist Benoit Mandelbrot, known for fractal geometry and using mathematics to show how financial markets are fraught with risk. The ceremony was punctuated by Mandelbrot and other Nobel laureates who kept a poker game going on stage.

The audience laughed, booed and constantly threw paper airplanes onto the stage.

Each Ig winner was allotted 60 seconds to give an acceptance speech, a time enforced by Miss Sweetie Poo, a little girl in a frock.

Peter Rowlinson of Newcastle University, Newcastle-Upon-Tyne, Britain, accepted an Ig prize for his team’s research showing that cows that are named and patted give more milk.

A Swiss team won the Ig prize for peace for their experimental research examining whether it is better to be smashed in the head with an empty beer bottle or a full one.

“It turns out that an empty bottle is actually more capable of inflicting serious damage,” said Stephan Bolliger of the University of Bern, who accepted the prize.

His team’s study, “Are full or empty beer bottles sturdier and does their fracture-threshold suffice to break the human skull?” was published in the Journal of Forensic and Legal Medicine.

Not to be outdone, a team from Mexico won the Ig chemistry prize for showing that diamonds can in fact be made from tequila. Javier Morales and Miguel Apátiga accepted the prize on behalf of the team, from Universidad Nacional Autónoma de México.

The team focused on tequila because it just happens to have the right atomic composition to grow diamonds, Apatiga said.

Morales and Apatiga made a dramatic on-stage appearance by jumping through an orange curtain held up by two of many on-stage helpers, human spotlights, people coloured head-to-toe in silver and toting flashlights, among them.

“Well, what a night,” Apatiga said as he went on to joke about tequila, diamonds and electron scanning microscopes. The scientist wore a giant sombrero with Mexico emblazoned across the front.

If you’ve ever been told to stop cracking your knuckles because doing so would give you arthritis, don’t worry, now you have scientific research on your side. Scientist Donald Unger, of Thousand Oaks, California, U.S., found there is no relationship between arthritis and cracking knuckles.

According to his study published in the journal, Arthritis and Rheumatism, he cracked the knuckles of his left hand every day for 60 years and did not crack the knuckles on his right hand. He does not have arthritis in either hand, he says.

Panda poop was the subject of research that won the Ig biology prize. The research demonstrated that kitchen waste can be reduced 90 percent or more by infusing it with bacteria that thrives in the feces of giant pandas.

Fumiaki Taguchi accepted the prize for the team, from Kitasato University Graduate School of Medical Sciences in Sagamihara, Japan.

A team from Harvard University received an Ig physics prize for discovering that pregnant women do not tip over because their spines are specially adapted for pregnancy, while the Ig in literature went to the Irish police service for writing and presenting more than 50 traffic tickets to the most frequent driving offender in the country, Prawo Jazdy, whose name in Polish means “driving license”.

Gideon Gono, governor of Zimbabwe’s Reserve Bank, won the Ig in mathematics for having his bank print bank notes ranging from one cent to one hundred trillion dollars.

“If you didn’t win an Ig Nobel prize tonight – and especially if you did – better luck next year,” Abrahams said in the traditional closing motto of the evening.

Excerpt:

By Adrianne Appel
BOSTON, Sep 18 2009 (IPS)

As all factions of the U.S. Congress continue a bruising debate about how to change the U.S. health system, one state, Massachusetts, seems to point the way clear, but activists say the Massachusetts plan is already troubled and doomed by skyrocketing costs.

All the major plans in Congress are mirrored after the reforms in Massachusetts, including the requirement that everyone purchase insurance at market rates – which grow yearly – or face a hefty fine. The fine is up to 1,000 dollars in Massachusetts.

“Once failure to buy health insurance is a federal offence, what’s next?” Steffie Woolhandler, a Harvard physician and member of Physicians for a National Health Programme, recently told a Congressional committee.

The Massachusetts reforms were crafted three years ago by Republican Governor Mitt Romney, the venture capitalist and presidential candidate.

“The Massachusetts plan is not sustainable. It contained no cost control and raised no new revenues. We’re basically just spending money,” Benjamin Day, executive director of MassCare, which campaigns for a single-payer system, told IPS.

On Wednesday, the influential U.S. Senate Finance Committee released its health care proposal, and it is the closest yet to the Massachusetts plan. It would force nearly everyone to purchase health insurance at market rates, or be fined. The government would provide some subsidies to low-income people.

It dashes the idea of President Barack Obama that the government sell low-cost insurance, and instead creates a managed marketplace where people and businesses can buy insurance and compare plans – but at market rates that in Massachusetts continue to spiral out of control.

The 880-billion-dollar Senate Finance plan, shunned by liberal members of Congress because it does not include the public option and Republican members who oppose the cost, throws a juggernaut into the health debate and makes it uncertain if Congress will be able to pass any substantial reform at all.

If Congress had only taken a close look at the problems in Massachusetts, the lawmakers may not have started down this road, activists say.

Also on Wednesday, insurers in the state announced that they were going to raise their premium costs by 10 percent next year.

“The intentions were good but success is all about cost control,” and that can only happen with a government-run, single-payer plan, Day said. “That’s the lesson from Massachusetts.”

The Massachusetts reforms are attractive to Congress because the state outlawed abuses by insurers and cut in half the number of people without insurance, meaning that 97.4 percent of residents were insured, the highest percentage of any state.

But, “Skimpy, overpriced coverage like this left one in six Massachusetts residents unable to pay their medical bills last year,” Woolhandler said.

The requirement that all residents buy health insurance or be penalised is a centrepiece of proposals being debated by Congress, though it has proved highly unpopular in Massachusetts and surprisingly unsuccessful.

About 352,000 people in 2008 chose to be fined rather than pay 4,000 dollars or more per year for health insurance, according to figures just released by the U.S. Census.

The Massachusetts reforms were enacted two years ago to try to decrease the hundreds of thousands of people showing up at hospital emergency rooms desperate for health care and with no money to pay for it.

There was a system in place to cover this care, a tax on wealthier hospitals that was redistributed to poor hospitals that provided most of this free care, and it was working well. But the wealthy hospitals asked for reforms.

“The individual mandate is a huge boon for insurers. And hospitals got a huge rate increase,” Day said.

“Patients are not an organised group and they had no voice, much less uninsured people. It’s not quite the ideal political experience,” he said.

“We had a free care pool for the uninsured and for many people it was better than what we have today,” Day added.

The poor now have to purchase drugs that previously were free, and pay every time they see a doctor or go to the hospital.

Poor people continue to seek free care at hospitals and clinics, but under the reforms the hospitals are no longer compensated for this care. The clinics and hospitals are buckling under the stress, and have had to cut staff and programmes.

Boston Medical Centre, which treats anyone regardless of ability to pay, is reimbursed just 64 cents for every one dollar it spends, it says. It is suing the state as a last resort.

Health reform “should not and cannot be financed on the backs of the poor. We hope our suit serves as a cautionary tale to federal policymakers as they take up national health care reform,” said the hospital’s CEO, Elaine Ullian.

Massachusetts allows just six health insurance companies to operate here, and the companies continue to charge the highest rates of any state. The reforms brought them business from 432,000 additional people, with the state paying all or part of the market price for 165,000 lower-income people.

If an employer offers health insurance, and most do, workers must purchase it no matter what their income or face a fine.

In Massachusetts, a 30-year-old can buy a plan for 220 to 600 dollars per month. At 220 to 282 dollars per month, they must also pay for the first 2,000 dollars of health bills. Afterwards, every time they see a doctor they must pay 25 or 40 dollars, plus fees for drugs, and up to 20 percent of hospital costs.

“The high-cost premiums force people to buy a high-deductible plan. This may mean you can’t afford to use the health care you buy,” Day said.

The reforms enacted two years ago did not include price controls and insurers have continued to raise their rates. Individual patients, even those subsidised by the state, purchase drugs on the open market at retail prices.

Most of the insurers made a profit in 2008, despite the recession, though they earned less than in 2007.

In 2008, net income at Harvard Pilgrim Health Care, the state’s second-largest health plan, was 48 million dollars, an increase of three million from 2007.

Tufts Health Plan earned net income of 18.8 million dollars in 2008, and it earned a hefty 110 million dollars in 2007.

“During such a challenging period, we are pleased to end the year with a positive net income,” says Umesh Kurpad, chief financial officer, in a statement.

Meanwhile, the state spent more than a billion dollars on the reformed plan in 2007, more in 2008 and still more in 2009. Those increases combined with the recession have already sunk the plan.

This spring, Gov. Deval Patrick announced that beginning Jul. 1, the state would cut a variety of benefits it covered for the poorest in the state. In addition, it would end any subsidies to 28,000 legal, new U.S. immigrants.

After an outcry, Patrick instead created a stripped-down plan that will insure most legal immigrants living in the U.S. for five years or less, starting in December. This means the state will subsidise a lower-rung system for some taxpaying residents, and a full plan for everyone else.

“The current realities of uncontrollable health care costs and the state’s budget crisis, begs the question, /will Massachusetts health reform survive its fiscal storm/?” wonders Elmer Freeman, director of the Office of Urban Health at Northeastern University, in his blog. /

Rep. Dennis Kucinich is circulating a petition that calls for a government-run health system. He believes that a plan will pass Congress based on private insurance and that health costs to families will continue to skyrocket.

“It will take four years for the new legislation to go into effect. During that time we are going to build a constituency of millions in support of real health care, a constituency which will be recognised and a cause which is right and just: health care as a civil right,” he says.

Excerpt:

By Adrianne Appel
BOSTON, Sep 5 2009 (IPS)

Hundreds of thousands of people in the U.S. continue to lose their homes each month in an ongoing crisis that is wreaking chaos on communities, advocates say.

Millions are out of work and high mortgage interest rates are kicking in, and many families can’t keep up with their mortgage payments, housing advocates say. The U.S. Department of Labour reported Friday that a record number of people are out of work.

“People are so far behind,” Stephanie Portea, director of ACORN in Florida, told IPS.

ACORN housing experts in Florida work with hundreds of families each month who are facing foreclosure, to try and help them stay in their homes. ACORN is one of many non-profits that are shouldering most of the burden of stemming the tide on a foreclosure-by-foreclosure basis.

A recent White House report found that mortgage lenders are doing little to help people facing foreclosure, despite generous government incentives to do so.

“Some of the banks are getting a bit better. But most are not,” Portea said.

The biggest reason foreclosures are still happening is that banks are not willing to seriously negotiate the loans they made, some of which have extremely high interest rates, she said.

“It almost doesn’t matter what the economy is like if the banks aren’t doing loan modifications,” Portea said.

July was the worst month yet for the number of foreclosures, according to recent reports by the private sector. In July, 8.6 percent of homeowners were delinquent on their mortgages – an increase of 40 percent over July 2008, according to Lender Processing Services.

The number of homes that have gone completely into foreclosure increased 89.6 percent since July of last year.

RealtyTrac reported that 360,149 U.S. properties were in foreclosure or delinquent on payments during July 2009. That means one in every 355 homes was issued a foreclosure notice in July, it said.

“July marks the third time in the last five months where we’ve seen a new record set for foreclosure activity,” James Saccacio, CEO of RealtyTrac, said in a statement.

Florida, Arizona, California and Nevada are the states with the highest rate of foreclosures, and some communities are being hit especially hard.

In Fort Myers, Florida, one in every 64 homes was served a foreclosure notice in July. In Las Vegas, one in 47 homeowners received a foreclosure notice in July, and in Phoenix, Arizona, one in every 103 homeowners was served, according to RealtyTrac.

“Despite continued efforts by the federal government and state governments to patch together a safety net for distressed homeowners, we’re seeing significant growth in both the initial notices of default and in the bank repossessions,” Saccacio said.

About 29 states and some cities have scrambled to enact laws to slow foreclosures, like requiring that a judge decide if a foreclosure is warranted. Massachusetts is one state that does not have such a law and the results are disastrous for families, says a housing activist there.

“Homeowners don’t get a day in court before foreclosure. They do get a day in court before eviction,” Steve Meacham, a community organiser with City Life, Vida Urbana, a Boston non-profit, told IPS. The group is known for protesting evictions and shaming banks into backing down.

“We seem to have a lot more leverage with banks after foreclosure,” he said.

About 2.9 million homes nationwide have already been lost to foreclosure and U.S. officials estimate that 2.5 million more people may face foreclosure in the next couple of years, a disaster sparked by what has been revealed as aggressive and often reckless mortgage making by lenders that included the nation’s biggest banks.

Many of the foreclosures involved questionable loan terms, including interest rates destined to rise spectacularly after a few months of low, “teaser” rates. The loans were made by financial institutions at a time when the value of housing was going up and up.

These sub-prime mortgages were transformed into investments by financial institutions and traded around the globe as highly risky packages.

Now it is mortgage interest rates that are going up and up, and housing value that is going down. Many houses are worth far less than what people paid for them.

In March, President Barack Obama set aside 75 billion dollars to lenders willing to negotiate with homeowners to avoid foreclosure. But the Home Affordable Modification programme is voluntary and just nine percent of the 2.7 million delinquent mortgages have been adjusted by banks, the government reported.

Among the big banks, many of which received a taxpayer bailout, Wachovia had the worst record and has modified just two percent of its bad loans. JPMorgan Chase and GMAC, formerly affiliated with General Motors, have negotiated the highest percentage of their bad loans – 20 percent.

It is unclear if the Obama administration will issue stricter guidelines for the programme. Officials did not return a request for comment.

In Boston, many homeowners are saddled with mortgages that are much, much higher than the value of the homes today.

“The untold secret of foreclosures in Boston is that well more than half of homeowners in foreclosure could afford their homes at their real value today. If the bank would rewrite the principal, they could avoid half of foreclosures. They are altering the interest rate and extending the terms of the mortgage but this is not acceptable,” Meacham said.

Activist groups plan to target the G20 summit in Pittsburgh later this month, when high-level officials and leaders from the world’s biggest economies will meet to discuss national stimulus packages and strategies to ameliorate the global economic crisis.

The Bailout the People Movement, together with some major trade unions and other grassroots organisations, is setting up a tent city and a march for jobs. Dozens of other groups are still awaiting permits to hold demonstrations, as the city prepares to deploy a massive security presence of thousands of police officers, state troopers and National Guard.

Foreclosures and unemployment go hand-in-hand.

The U.S. Bureau of Labour Statistics said Friday that the number of recorded unemployed people in the nation reached 14.4 million in August, for an overall rate of unemployment of 9.7 percent. This is about double the number of people unemployed before the recession began in 2007 and the highest rate of joblessness in 50 years.

African Americans had the highest rate of unemployment, 15 percent, of any other ethnic group.

Another 2.3 million people indicated they were barely working and wanted a job, but were no longer looking. An additional nine million people work part-time but are unable to find full-time work, the bureau learned in a survey. Together, the rate of those who are unemployed and underemployed is 16.8 percent, the bureau said.

People who are employed are working less than a full week, an average of 33 hours each week, instead of 40, because of employer cutbacks, the bureau reported.

Two nights ago in Boston, 80 people gathered outside a hotel where inside, Deutsche Bank executives and guests were celebrating an upcoming golf tournament. Deutsche bank is responsible for evicting more families than any other, according to Vida Urbana.

In the latest eviction, the tenants offered to buy the building at today’s price. The bank refused. At the protest, the group sang gospel and protest songs and, “We served a notice to quit on Deutsche Bank,” Meacham said.

Excerpt:

By Adrianne Appel
BOSTON, Jul 30 2009 (IPS)

Banks bailed out with U.S. taxpayer money, like Wells Fargo and U.S. Bancorp, are raking in money by charging 150 percent interest and more on short-term, payday loans to people with no savings, consumer advocates say.

“I think this is outrageous. These banks got billions in bailout funds and now it’s business as usual,” Jim Campen, executive director of Americans for Fairness in Lending, told IPS.

Once the sole domain of freestanding, paycheque-cashing storefronts, payday loans are proven to send borrowers deeper into debt, while making massive profits for the lender, according to the National Consumer Law Centre.

The Federal Deposit Insurance Corporation changed a rule in 2005 to allow banks to enter the lucrative market of payday lending. In 2008, the FDIC issued guidelines for bank payday loans, with a suggested cap of 36 percent interest.

Wells Fargo, U.S. Bancorp and other banks have chosen not to follow the voluntary guidelines and instead are charging triple-digit interest on payday loans to cash-strapped customers, according to consumer organisations.

Low-income families with little savings are especially vulnerable to these usury fees, says Chi Chi Wu, staff attorney with the National Consumer Law Centre, one of a number of organisations in support of a nationwide cap on interest rates.

“The essential problem with triple-digit [interest] is it can dig borrowers into a hole,” Wu told IPS.

The 700-billion-dollar Troubled Asset Relief Programme (TARP) for banks was created in October 2008, after former Treasury Secretary Henry Paulson said the U.S. needed to hand over the funds to banks to avoid certain collapse of the entire financial system.

Since then, the U.S. has given 441 billion dollars in TARP funds to banks, plus an additional two trillion dollars to banks, auto companies, insurers and financial firms through other Treasury programmes, according to a report by the TARP Special Inspector General.

The Special Inspector General found that the banks were using the bailout funds for purposes other than to make loans, which was the intent of the programme.

Many of the big banks have already paid back their bailout funds, and some report hefty profits.

Wells Fargo, which received 25 billion dollars in TARP funds, made close to three billion dollars in profits between January and June 2009. It has not yet paid back its TARP loan.

At Wells Fargo, the loans are offered to people who have their paycheques automatically deposited at the bank. The bank provides advances on the paycheques, often to people faced with unforeseen bills, like healthcare.

The Wells Fargo Direct Deposit Advance Service lets people borrow half of their monthly income or a maximum of 500 dollars, for two dollars for every 20 dollars borrowed, which equals 120 percent Annual Percentage Rate (APR) interest.

“It is designed to help customers get through an emergency situation – medical emergencies, a car repair, emergency travel expenses – by providing short term credit quickly,” Richele J. Messick, a spokesperson for Wells Fargo, told IPS in an email.

The advance and the fee must be paid out of the next paycheque, Messick said.

“Wells Fargo encourages all our customers to properly manage their accounts. However, emergencies do arise, and our Direct Deposit Advance Service can help customers when they are in a financial bind,” Messick said.

U.S. Bancorp customers who have direct deposit are offered payday advances of 20 to 500 dollars at 120 percent APR that can be taken out instantly online or through an ATM.

Customers who direct deposit as little as 100 dollars per month are eligible for these loans without approval, according to U.S. Bancorp, the eighth largest bank in the U.S.

Like Wells Fargo, U.S. Bancorp gets first access to a customer’s paycheque, before any other withdrawals or bill collectors.

U.S Bancorp received 6.6 billion dollars in TARP funds, and earned 529 million dollars in the first three months of the year, and 221 million dollars this spring, the bank says. It recently paid back its TARP funds.

The bank did not respond to requests for an interview.

Fifteen states outlaw loans that charge more than 17 to 36 percent interest, but the banks have found a loophole and they offer the triple-digit loans in all states.

Two bills in Congress would place a national cap on interest rates for consumer loans and auto loans. Sen. Bernie Sanders’ legislation would cap interest rates at 15 percent, and Sen. Dick Durbin is proposing a 36 percent cap.

“We think [federal regulators] should crack down on this. We think what Wells Fargo and U.S. Bancorp is doing is not good,” Kathy Day, a spokesperson for the Centre for Responsible Lending, told IPS.

“The way they disclose the interest and calculate it is a severe underestimate of the cost of the loan. If you borrow at the end of the month, the interest is four times that rate,” Campen said.

The Fifth Third Bank, in Ohio, Kinecta Federal Credit Union, in California and Nevada Federal Credit Union also offer triple-digit payday loans, according to the National Consumer Law Centre.

MetaBank, an internet bank based in South Dakota, provides a line of credit, called iAdvance, for 150 percent APR that is linked to customers’ bank accounts. The loans do not have to be paid back within the month.

“Unexpected expenses pop up at the worse time. The iAdvance line of credit from MetaBank provides security and peace of mind when life doesn’t go according to plan,” the company’s literature says.

People who agree to direct deposit their paycheques with MetaBank and hold one of MetaBank’s many prepaid cards, offered through partner banks, are eligible to apply for the credit line, according to MetaBank.

Prepaid cards look like credit cards but no credit is involved. The money is placed on the card by the person who owns it, who can then use it instead of cash, for 9.95 dollars per month and two dollars per ATM withdrawal. MetaBank has 50 million prepaid card customers, it says.

MetaBank’s literature makes clear that the line of credit and prepaid cards are aimed at people with poor credit or no credit.

“iAdvance also reports to credit bureaus, so you have the opportunity to improve your credit,” the company says.

Customers can take out the iAdvance loans repeatedly, and can “use the service” for 12 consecutive months. If an iAdvance loan is not completely paid off by the next payday, the company garners future paycheques until the loan is paid off, company literature explains.

Though the iAdvance loans begin at 150 percent interest, they can climb to 650 percent if they are not paid within 30 days, says the National Consumer Law Centre.

“These loans are for people living from paycheque to paycheque. There is a whole industry that preys upon financially vulnerable people,” Day said.

Excerpt:

By Adrianne Appel
BOSTON, Jul 24 2009 (IPS)

The U.S. Federal Reserve and U.S. Treasury have doled out trillions in taxpayer dollars to banks and corporations and now the boom may be falling on what lawmakers say is a shroud of secrecy that surrounds their actions.

In separate hearings on Capitol Hill this week, lawmakers expressed support for a bill to make the Fed's decisions more transparent, and for the findings of a special inspector general report that calls for greater transparency in the Treasury's bailout of banks, called the Troubled Asset Relief Programme (TARP).

"Although Treasury has taken some steps towards improving transparency in TARP programmes, it has repeatedly failed to adopt recommendations that [the special inspector general] believes are essential to providing basic transparency and fulfill Treasury's stated commitment to implement TARP with the highest degree of accountability and transparency possible," says the report of Special Inspector General Neil Barofsky.

"If Treasury doesn't put this information up on its website, this committee will. And if Treasury doesn't turn over this information voluntarily, Secretary [Timothy] Geithner will be brought before the committee to explain," said Democrat Edolphus Towns of New York, chair of the House Committee on Oversight and Government Reform.

In yet another sign of change to the institutions, President Barack Obama has fielded a proposal to create a Consumer Financial Protection Agency, which would rearrange and strip some powers now held by the Fed. The proposal seems to have wide support among leading lawmakers.

"I don't see why there shouldn't be 100 percent, crystal clear transparency of the actions taken at the Fed," said Republican Rep. Bill Posey of Florida. "The public has a right to know."

Posey made his comments directly to Fed chairman Ben Bernanke as he presented his semi-annual report on the economy to a House Committee Tuesday.

Bernanke argued that actions taken by the Fed in the previous 12 months helped prevent a wholesale collapse of the global financial system.

"The financial shocks that hit the global economy in September and October were the worst since the 1930s, and they helped push the global economy into the deepest recession since World War II," Bernanke said.

At the end of 2008, the Fed had 1.5 trillion dollars in short-term loans outstanding to the nation's biggest banks and financial institutions, compared to 600 billion dollars today, Bernanke said.

The attention of the Fed has worked and credit is flowing again among the largest banks and corporations, and the nation's gross domestic product will nudge up to two percent and maybe a near-normal three percent in 2010, he said.

The rest of the economy is not faring as well, he conceded. The Fed predicts that unemployment will reach 10 percent by the end of 2009, and foreclosures will continue to rise.

"Financial conditions remain stressed and many households and businesses are finding credit difficult to obtain," Bernanke said. It is likely that the nation will soon see many foreclosures in commercial real estate, he said.

The Fed expects to raise the interest rate it pays to banks with accounts held by the Fed, when the economy improves. That interest rate is now at 0.25 percent.

This and other decisions, like the short-term loans it makes to banks through its discount window, should continue to be made in secret, he said.

"We are taking all the steps necessary to protect taxpayer money. One sensitive area is to have Congress second-guessing monetary policy," Bernanke said.

Bernanke was directing his comments at a bill supported by many lawmakers that would require more auditing of the Fed's actions. It proposes conducting audits of decisions made by the Fed, including setting interest rates, six months after the decision is made.

The bill is sponsored by Republican Rep. Ron Paul, the Texan known for his outspoken opposition to the deficit and his maverick run for president.

The Fed "doesn't want Congress to know what it is doing", Paul said.

Such an audit could welcome "political interference" in The Fed's decisions, Bernanke warned.

"If we raise interest rates at a [Fed meeting] and someone in Congress didn't like the decision and ordered an audit, isn't that interference?" he said.

Elsewhere in Congress, the Treasury's actions were under scrutiny, as Special Inspector General Barofsky detailed the shortcomings of that institution's bank bailout programme.

Twelve separate programmes recently created at the Treasury have handed out nearly three trillion dollars to banks, financial companies, auto companies and insurers, Barofsky said.

The eventual, total price tag for all the government's bailout programmes could reach 27.3 trillion dollars, if the economy continues to flag, Barofsky said.

The Treasury has refused to audit the money loaned to the banks to see how they are spending it. The Treasury has called such audits "meaningless," Barofsky said.

So Barofsky's office went ahead and pursued the information.

The office surveyed 360 banks that received Treasury bailout funds and found that almost all were using the money in ways other than to lend – which was the intent of the programme. The banks used some of the funds to lend, but also to purchase other banks, to pay off debts and to simply hold in reserve should they need the funds in the future.

"TARP has become a programme in which taxpayers are not being told what most of the TARP recipients are doing with their money, have still not been told how much their substantial investments are worth, and will not be told the full details of how their money is being invested," Barofsky said.

"The taxpayers now have a 700-billion-dollar spending programme that's being run under the philosophy of "Don't ask, don't tell," Towns said.

Sociologist Saskia Sassen of Columbia University said from her London office that it is important to step back and look at the big economic picture. The bailout is not going to ease unemployment or foreclosures, she said.

"The fundamental problem with the bailout is that it is a financial solution to a non- financial crisis. The bailout works for the financial sector. Along with that relative success is growing unemployment among workers and growing foreclosures that are forecast to reach 10-12 million over next four years," she told IPS.

Excerpt:

By Adrianne Appel
BOSTON, Jun 5 2009 (IPS)

U.S. taxpayers have given 50 billion to rescue General Motors, but the company says it should not have to pay a penny to people harmed by known defects in its vehicles.

Despite the billions, the company is in collapse and filed for bankruptcy Jun. 1 to re-work debts and restructure its operations. It will dump the Hummer and Saturn models, lay off 21,000 workers, shutter 3,000 dealerships and start anew as a largely U.S.-owned company with a green edge.

As it negotiates bankruptcy in a New York court, the company is arguing that it should be absolved from paying out money to people who are hurt as a result of known problems in its cars already on the road. Consumer groups are fighting against the plan, and a similar deal already granted to Chrysler.

“If any defect in a GM car causes an accident, or injures someone or kills the occupants, there would be no recourse, no opportunity for compensation or to make a claim in a lawsuit. It would affect every single driver of a GM vehicle,” Joanne Doroshow, executive director of the Centre for Justice and Democracy, told IPS.

“In restoring GM to health, don’t compromise the health and safety of consumers,” Clarence Ditlow, executive director of the Centre for Auto Safety, told IPS.

The U.S. now owns 72.5 percent of GM and the United Auto Workers health care trust owns 17.5 percent. The union gained a seat on GM’s board, and it agreed not to strike through 2015.

GM has one of the very worst safety records among car makers. With 30 million vehicles on the road, the company is sued by the hundreds each year for known defects that result in people being killed, burned and disabled, according to Doroshow’s group.

Victims file the lawsuits for help with medical bills, which can be extremely expensive in the U.S. private health care system.

Each year, between 500 and 1,000 people are harmed or killed in GM and Chrysler vehicles, according to the Centre for Auto Safety. Chrysler has 10 million vehicles on the road.

Robert Doss, of Arizona, filed a lawsuit on behalf of his eight-year-old son, Shaun. Shaun became a paraplegic after the seatbelt in his father’s Chrysler Dodge Durango failed during an accident. Their lawsuit will not go forward now, Doss told reporters Wednesday, while visiting Congress.

Jeremy Warriner, of Indiana, whose legs were burned beyond saving three years ago when brake fluid spilled and ignited during an accident in his Jeep Wrangler, said the personal injury lawsuit he filed against Chrysler also is defunct since the bankruptcy deal.

Chrysler used U.S. bankruptcy law to “sweep the people who have been injured by Chrysler products under the rug and walk away as if it never happened,” Warriner said.

The consumer groups have filed an appeal to the bankruptcy court to reverse its decision about Chrysler.

GM filed for bankruptcy after years of bad management and its reputation for poor quality vehicles caught up with it during the recession.

Some of its vehicles have been plagued repeatedly by egregious safety problems, like roofs that collapse during rollover accidents, gas tanks that ignite upon impact and weak seats that give way.

“The government has investigated most of the defects. They conclude that there aren’t enough crashes, injuries and fatalities to warrant a recall that could cost hundreds of thousands to the manufacturers,” Ditlow said. Instead, the car companies are expected to pay out money to victims who sue.

One such lawsuit was settled in 1995 against General Motors and Chevrolet at that time. The companies built pick-up trucks in the 1970s and 1980s in which the gas tanks were outside of the frame, and vulnerable to impacts. More than 500 of the trucks had exploded and 183 people died. Trucks with a similar design are still on the road, Ditlow said.

GM spent 2.7 billion dollars on product liability losses in 2007, more than any other car company, which relates to its size and its poor safety record, Ditlow said.

“You don’t pay that out unless you have serious defects in your cars,” Ditlow said.

If the judge in the GM bankruptcy takes away people’s right to sue the company, the consumer groups hope Congress will step in and create a fund for victims.

“They could clearly do this, and it’s a reasonable thing to do,” Doroshow said.

Long-time consumer advocate Joan Claybrook testified to Congress recently and urged lawmakers, after decades of asking, to finally step up safety requirements in vehicles, to prevent harm.

“The unfinished motor vehicle safety agenda is long and deep,” Claybrook, the former president of Public Citizen, told the House Judiciary Committee on May 21.

Motor vehicle crashes kill over 40,000 U.S. citizens every year, injure another 2.5 million, and are the leading cause of death for all persons in the United States, ages four to 34, she said.

An injury due to motor vehicle accident occurs every 10 seconds and a motor vehicle fatality occurs every 12 minutes, Claybrook said.

“These manufacturers for the last 40 years have bobbed and weaved to oppose any serious improvements in motor vehicle safety, fuel economy and emissions,” Claybrook said.

Excerpt:

By Adrianne Appel
BOSTON, May 20 2009 (IPS)

Just months after getting a massive handout from Uncle Sam to prevent the collapse of Wall Street, big banks say they are back on solid ground and ready to repay the money.

The banks are selling stock and debt, and racking up excellent returns on mortgages, loans, high credit card rates and refinancings.

Three big banks, Goldman Sachs, JPMorgan and Morgan Stanley, say they are so healthy now that they can begin to pay back the billions they were given by the U.S. Treasury in December when they said they were on the brink of failure.

Meanwhile, home foreclosures in April were 342,000 – the highest level yet – and average national unemployment rose to 8.9 percent, the highest level since 1983. Some communities are just barely hanging on.

“There’s an enormous impact of the foreclosure crisis and the unemployment crisis on people of colour,” Rinku Sen, executive director of the Applied Research Centre, a public policy institute advancing racial justice through research, advocacy and journalism, told IPS.

“Because they were so concentrated in communities of colour, the larger system didn’t pay attention. The banking system didn’t send out any red flags, and local and state officials didn’t start looking into the crisis. There wasn’t the scrutiny there should have been, given the millions of people affected,” Sen said.

Mortgage lenders and banks sought out people of colour in particular, and charged higher than average interest rates on loans with poor terms, according to the National Association for the Advancement of Coloured People (NAACP), which is suing some of the nation’s largest banks – many the same ones that received a bailout.

Under the bank bailout, nine big banks received 125 billion dollars, followed by smaller banks, for a total of about 400 billion dollars awarded to 586 banks, insurers and auto companies. The U.S. government received warrants to buy stock in the banks, in a deal many economists say was a giveaway to the banks.

“Is it possible taxpayers will get their money back 10 years from now? Yes, but it’s not likely. It’s clearly a massive subsidy,” Robin Hahnel, economics professor emeritus at American University, told IPS.

Larry Summers, the hand-picked economic advisor to President Barack Obama, and U.S. Treasury Secretary Timothy Geithner are not doing right by U.S. taxpayers, Hahnel said.

“My position is they are mismanaging this so badly they need to be fired immediately. They are putting us at terrible risk,” Hahnel told IPS.

“Some banks are in a position to repay because they’ve made money the old-fashioned way, by borrowing at low rates and lending at significant interest rates,” said Timothy Canova, economics professor and associate dean at Chapman University School of Law.

The banks borrow money from the Central Bank at nearly zero percent interest and then loan it out at five or six percent, he said.

“That’s a healthy spread,” Canova told IPS.

The entities that took the Treasury money have had to comply with rules that restrict salaries and bonuses to executives, and limit the hiring of non-U.S. citizens. The rules were only enacted after public outrage over millions in bonuses paid to individual executives.

“The main motivation for returning the money is that the bank officials would like to be able to start rewarding themselves again with higher compensation packages. They don’t want the strings attached,” Canova said.

“We can expect to see more paybacks. But we can also expect to see more banks that will need more funding in future,” Canova said.

Nineteen big banks with more than 100 billion dollars in assets recently conducted financial reviews, called stress tests, at the request of the Federal Reserve. The Fed announced that nine banks are in the clear and 10 will need 74.9 billion dollars more, under a best-case economic scenario. Under the worst-case scenario, they would need up to 600 billion dollars more.

The reviews have been widely criticised by a range of conservative and progressive economists for not being realistic.

Canova said even the worst-case scenario seems overly optimistic, predicting an unlikely growth in the GDP.

“It’s quite possible the GDP will continue to decline and then the banks may need twice that amount of money,” Canova said.

The stress tests were conducted by the banks themselves. The Fed asked them to predict their own potential losses and liabilities under the two scenarios. Banking supervisors chosen by the Fed met with bank management to evaluate the estimates, all performed within 45 days.

The 10 banks that need cash can request a handout from the U.S. Treasury, in exchange for stock valued at a rock-bottom price, at slightly below what it traded for in February 2009.

But more likely, they can get the cash from the private market, by selling stock and seeking investors, Geithner said.

“If these institutions are essentially solvent, as Mr. Geithner suggests based on the stress test results, then it seems appropriate to put an end to these taxpayer subsidies,” economist Dean Baker told the Oversight and Investigations Subcommittee of the House Committee on Science and Technology on Tuesday.

“Is there really a need for the special lending facilities that have been created by the Fed and have more than two trillion dollars outstanding in loans to the banks and other institutions?” said Baker, co-director of the Centre for Economic and Policy Research.

In addition, in June, the U.S. government will begin purchasing up to 1 trillion dollars of the bad assets now held by banks, he said.

The stress test results immediately boosted the value of stock at many of the banks, and they wasted no time in taking advantage of their good fortune.

Within a day of the test results, Morgan Stanley sold enough stock to raise 3 billion dollars. It was aiming for 1.8 billion dollars, as called for in its stress test. It will eventually need to give back about 10 billion dollars in bailout funds to the Treasury.

Many banks will continue to make significant money on credit cards, charging interest rates of 21 percent or more, plus fees and penalties. The credit cards are issued by many major banks, including Bank of America, Citigroup and JP Morgan. A credit card reform bill is expected to be signed by Obama by the end of this week.

According to recent hearings in the U.S. House and Senate, 78 percent of all U.S. households have at least one credit card, and they have paid an average of 15 billion dollars in penalty fees per year.

The proposals in play, one passed by the Senate Tuesday, would not go into effect until 2010 at the earliest.

In the meantime, Edward L. Yingling, president of the American Bankers Association, told reporters this week that the industry would continue to raise interest rates, this time on its best credit card customers, to make up for the revenue it expects to lose under the upcoming credit card reforms.

Excerpt:

By Adrianne Appel
BOSTON, May 12 2009 (IPS)

When a North Atlantic right whale swimming near Boston bellows at 3 a.m., a phone rings in a small town in upstate New York.

The world's 400 remaining right whales must navigate through tankers, small vessels and fishing boats, and waters clogged with fishing gill nets, lines and gear. Credit: New England Aquarium

"They may get woken out of bed. It’s not an easy job," Chris Tremblay, manager of the alert system, said of the 15 analysts. The Right Whale Listening Network is run by the Bioacoustics Research Laboratory at Cornell University’s Ornithology Laboratory.

The Cornell alert system works 24 hours a day, seven days a week, whenever a whale call is detected by any of 16 listening buoys installed near Boston, or 10 buoys near New York City.

The analysts put up with the strange work hours because they think of it as an opportunity to protect one of the most endangered animals in the world, Tremblay said.

"They feel like they are doing something important," Tremblay told IPS.

At 65 tonnes and 15 metres long, these whales don’t rush. They lumber through the cool waters along the East Coast of North America, as far north as the Bay of Fundy, at top speeds of just 16 kilometres per hour, as they have for thousands of years.

The whales amble through the water with their crooked mouths gaping wide, feeding and calling out to each other.

"'The only thing you can say is they are very odd," Charles "Stormy" Mayo, a senior scientist of the Provincetown Centre for Coastal Studies, told IPS. "Gigantic mouths occupy the front third of the animal, and they have huge walls of baleen, leading to this capacity to filter monstrous amounts of water."

"They have tails much bigger than other whales because they need it to push their giant mouths through the water," said Mayo, who has been studying what, where and how the whales eat for more than 35 years.

The North Atlantic right whale was hunted almost to extinction in the 1800s and its population has not recovered.

Today, the whales’ waters are cluttered with tankers, small vessels and fishing boats, and clogged with fishing gill nets, lines and gear. Collisions with ships and gear entanglements are their biggest killers, said Mary Colligan, a whale expert with the federal National Oceanic and Atmospheric Administration.

She is one of hundreds of conservationists, researchers and government experts who are desperately trying to keep the whales from becoming extinct.

"Our goal is zero entanglements," Colligan said. "It’s a very difficult issue because there is no easy solution," she said of keeping the "urban" whales safe.

The whales naturally live to 70 years, but the average lifespan today is just 15, mostly due to human causes, according to Cornell’s bioacoustics programme.

More than 75 percent of the right whales have scars from ship propellers or commercial fishing gear, according to the Provincetown centre.

"The most severe entanglements involve the mouth. The tackle gets caught in the mouth and impedes feeding," Colligan said.

The whale population was declining for decades and since about 1999, ever stricter shipping and fishing rules have been in force, and elaborate alert systems like the one in Boston installed.

"The waters they migrate through, and their habitats, are now safer because of the conservation measures we’ve been able to put in place," Moira Brown, senior scientist at the New England Aquarium, told IPS.

Recently, "things have been looking better for the right whales," Brown said.

The whale population has started to grow at one percent a year, after years of declining. This year a "bumper crop" of 39 calves were born, she said.

Brown’s dedication to the whales takes her out at sea, near Boston, in January, when the temperature may be minus 6 degrees C. on land. She and a crew take turns standing on deck, to observe and photograph any whales. They dress in one-piece, insulated suits.

"With a flotation in it, just for safety purposes, not that we plan to go over the side," she said.

The photographs are entered into a database of every known whale, which many researchers contribute to. The whales are identified by a unique pattern of raised, white bumps on the backs of their heads, called callosities. As calves they were born with completely smooth skin but within weeks, callosities form and stay with them for life.

Officially, the researchers catalogue the animals by number. Unofficially, some are known as Nantucket, or Silver, a male missing part of his tale fluke, or Kingfisher, who lives year in and year out with fishing gear tangled around his flippers.

Ruth Leeney and her crew take aerial photographs of whales that feed in Cape Cod Bay.

"This work is particularly interesting because you get to fuse research with conservation," Leeney told IPS.

*This story is part of a series of features on sustainable development by IPS and IFEJ – International Federation of Environmental Journalists ­- for Communicators for Sustainable Development (www.complusalliance.org ).

Excerpt:

By Adrianne Appel
BOSTON, May 1 2009 (IPS)

The U.S. government will invest billions in Chrysler and the United Auto Workers (UAW) trade union will become majority owners of the company, in a financial rescue deal announced Thursday by the White House.

“We’re going to make the U.S. auto industry the best auto industry in the world,” U.S. President Barack Obama said Thursday, after a month of speculation about a Chrysler deal.

The White House will give more than 6 billion dollars to Chrysler as it goes through a “quick bankruptcy” and revamps its operations. Canada will give about 2 billion dollars to Chrysler.

Chrysler’s management will step aside and the company will be run by Italian carmaker Fiat and a new board of directors. Its target is to make modern, fuel-efficient cars in Detroit, Michigan, the seat of U.S. car manufacturing.

“The necessary steps are being taken to give one of the most storied automakers, Chrysler, a new lease on life,” Obama said.

The car-maker’s union, the United Auto Workers, will become 55 percent owners of Chrysler. The UAW agreed to further wage and benefits cuts but retirees’ health benefits are preserved under the plan worked out between Chrysler and the White House auto task force.

“This has been a long ordeal for active and retired auto workers and a time of great uncertainty,” said UAW President Ron Gettelfinger. “Our members have responded by accepting an agreement that is painful for our active and retired workers, but which helps preserve U.S. manufacturing jobs and gives Chrysler a chance to survive,” he said.

“I will tell you that the workers at Chrysler have made enormous sacrifices – enormous sacrifices – to try to keep the company going,” Obama said Wednesday at a public appearance.

William Black, an economist at the University of Missouri, said the U.S. had to save Chrysler or General Motors. General Motors will deliver its restructuring plan to the White House by Jun. 1.

“For both to go down could really send unemployment into dangerous spiral,” Black told IPS.

But Black said he and other progressive economists believe the financial industry needs a big overhaul if the U.S. economy is to get back on safer ground.

Big banking has expanded to the point where it makes up 40 percent of the U.S. gross domestic product – and it is in a disastrous condition and is jeopardising the entire economy, Black said.

“Fixing the auto industry is important but revamping the financial industry is critical,” Black said.

“Our economy is profoundly screwed up. The finance industry destroyed wealth and ruined the economy,” Black told IPS. “We should try to make the financial sector far smaller,” he said.

“If we did the same for the financial industry as we’re doing with the auto industry, we would have put hundreds of banks in receivership, and refused to bail out certain asset lines,” Black said.

The big banks need the same treatment as the auto industry and more – CEO’s tossed out and big salaries slashed, operations made leaner, and the entire sector downsized, Black said.

After a storied past, Chrysler and General Motors were led by bad management decisions to make many poor quality vehicles that were easily outpaced by foreign brands, like Honda and Toyota.

“The problem was they were bad manufacturers. It took decades for them to [destroy] the cache they once had,” Black said.

Black likened U.S. car manufacturing to U.S. steel production. Once a giant in the global economy, it grew inefficient compared to modern, Japanese manufacturers.

“The U.S. got killed. The Japanese absolutely wiped out the U.S. competition.” Today the U.S. steel industry is profitable, but small and specialised.

“To follow that model you’d be breaking off brands with a cache and making them better, and greener. That does seem to be sort of where Obama is going with this,” Black said.

Greenpeace will try to convince Obama to build an entirely new, clean technology base in Detroit.

“It’s not just a question of cars, it’s a question of giving Detroit the resources it needs to compete in clean technology, which is the next growth industry in the world,” Michael Crocker, Greenpeace spokesperson, told IPS.

“We need to retool Detroit to make photovoltaics, wind turbines and a suite of energy efficient technologies that produce low- or no carbon,” Crocker said. “We did it in World War II and we can certainly do it again.”

Joseph Romm, a deputy assistant secretary of energy during the presidency of Bill Clinton, said U.S. cars need to be very fuel efficient to make a difference in global warming.

“Vehicles need to meet the California fuel economy standards. We need hybrids and plug-in vehicles,” he told IPS.

Chrysler and General Motors already received 17.4 billion dollars in low-interest loans during the administration of former President George W. Bush.

They then approached Obama for more funds and he agreed, but only if they would re-organise and begin making better, and fuel-efficient cars. General Motors, considered the stronger company, has until Jun. 1 to file its overhaul plan to the White House. Ford, the third major U.S. car company, declined White House assistance.

Over the years, Chrysler turned to creditors for loans, and today its ownership is a tangle of banks, hedge funds and investors. On Thursday it was announced that Chrysler’s major creditors, JPMorgan Chase, Citigroup, Morgan Stanley and Goldman Sachs, will accept 33 cents on the dollar for their original investments of about 4.83 billion dollars.

The four big banks have themselves received tens of billions in aid from the U.S. Treasury for their bad deals in mortgage securities, so it is not surprising that they agreed to the White House-Chrysler plan to write down the car company debt.

Another group of creditors refused to write down their 1 billion dollars in loans to Chrysler, forcing it to go to bankruptcy court to write it off.

“I don’t stand with them. I stand with Chrysler’s management and employees,” Obama said.

When it comes to finances, Chrysler and General Motors are far from old-fashioned U.S. manufacturers. Both expanded into money-making, financial activities and complex affiliations that rival any of today’s better-known financial institutions.

GMAC is a financial company affiliated with General Motors. GMAC and its related entities make car loans, personal loans and mortgages. It is one of the nation’s biggest mortgage lenders. In 2008 it was financially unsteady, and held more than 2 billion dollars in debt. GMAC has been hit with many lawsuits for questionable mortgage lending practices.

In December 2008, GMAC was allowed by the George W. Bush administration to become a bank-holding company, to be eligible for U.S. Treasury bank bailout funds. GMAC then asked for and received 5 billion dollars from the U.S. Treasury.

GMAC announced Apr. 1 that it would make 5 billion dollars in loans available to car buyers, even those with poor credit. Thursday it was announced that Chrysler Financial will be swallowed by GMAC, and that GMAC will provide financing for Chrysler car loans. The U.S. government will assist GMAC as necessary.

“If you are considering buying a car, we hope it will be an American car. The warranty will be fully backed by the U.S. government,” Obama said.

Excerpt:

By Adrianne Appel
SAN FRANCISCO, Mar 20 2009 (IPS)

Thousands of angry U.S. workers took to the streets Thursday to protest some major banks and insurance companies that have handed out extravagant bonuses on the taxpayers’ dime, as the U.S. House of Representatives voted to get some of the bonus money back.

Protesters rally against corporate excess and CEO bonuses in front of AIG headquarters in Washington DC Mar. 19, 2009. Credit: Jobs With Justice

The protesters, from ACORN, Catholics United, Jobs with Justice, the powerful Service Employees International Union (SEIU) and other groups marched in Boston, Chicago, Denver, New York and other cities. The actions were aimed at raising support for strong banking reform, the right to unionise and health care for all. Some also marked the sixth anniversary of the start of the Iraq war.

“We’re not about to let up until we see effective change in San Francisco, Sacramento [California’s state capital] and Washington, D.C.,” Matt Roberts, a security officer and SEIU member, told IPS.

Rev. Israel Alvaron, of Clergy and Laity United for Economic Justice, marched in front of the San Francisco Wells Fargo in solidarity with hotel and restaurant workers in the Bay Area whose employers, including Hyatt and Meridian, are discouraging them from unionising.

“Wells Fargo is a client of the hotels. That’s why I’m here,” Alvaron told IPS.

Roberts said Wells Fargo and other banks are taking taxpayer dollars with one hand and with the other, are lobbying against a bill in Congress that would remove barriers to unionising, called the Employee Free Choice Act.

“We’re absolutely opposed to AIG [American International Group] getting multi-million-dollar bonuses,” Roberts added.

Wells Fargo paid its CEO 26 million dollars in 2007 and paid its bank tellers about 21,000 dollars, SEIU says. The bank has increased its fees on consumers by almost 30 percent since 2003. It spent 690,000 dollars on lobbying in just the last three months of 2008, SEIU says. The protests came just days after the public learned that AIG, a global insurance firm, handed out 165 million dollars in bonuses to its top employees on Mar. 13.

The ailing company has so far received 173 billion dollars in taxpayer assistance to keep it and major banks from a total collapse. U.S. taxpayers gained 80 percent of the company in exchange for the funds, but the deal has been widely criticised because the U.S. has no shareholder voting rights and no representation on the company’s board.

AIG is in bad shape because it insured the risky trades of major banks, trades of exotic products, called credit default swaps, derived from questionable, high-interest mortgages held by banks. More than 2 million mortgages have since gone belly up.

Many banks now want to cash in on their insurance and AIG says it is out of cash.

New York Attorney General Andrew Cuomo subpoenaed AIG and learned that the company paid bonuses to 417 employees and that 298 were paid more than 100,000 dollars. More than 50 people were paid 1 million dollars each. Eleven of those who were given bonuses are no longer with AIG.

“I know 165 million is a very large number,” AIG CEO Edward Liddy told the House Finanical Services Committee on Wednesday. “We thought it was a good trade,” for the work the company has done to reduce its debt, he said.

AIG is just one of more than a dozen major banks that have received huge infusions of bailout cash from the U.S. Treasury, and that then attempted to hand out hefty bonuses to CEOs. Some halted the bonuses, under public pressure.

Merrill Lynch is expected to hand over its bonus information soon to Cuomo.

According to a recent report by the Institute for Policy Studies, Wall Street firms handed out 18 billion dollars in bonuses in 2008.

An angry congressional panel questioned AIG CEO Edward Liddy on Wednesday about the bonuses.

Thursday, the House passed a bill that would strip 90 percent of the bonus amounts, by heavily taxing them.

The taxes would only apply to people whose family income is 250,000 dollars or more, who received bonuses in 2009 and who work at one of the dozen or so banks bailed out by 5 billion dollars or more,, including Bank of America Corp., Citigroup Inc., Goldman Sachs Group Inc., J.P. Morgan Chase & Co., Morgan Stanley and the mortgage agencies, Fannie Mae and Freddie Mac.

The House bill was passed by 243 Democrats and 85 Republicans, and six Democrats and 87 Republicans voted against it. A similar bill is expected to pass the Senate soon and be signed into law by Pres. Barack Obama.

“Today’s vote rightly reflects the outrage that so many feel over the lavish bonuses that AIG provided its employees at the expense of the taxpayers who have kept this failed company afloat,” Obama said Thursday. “I look forward to receiving a final product that will serve as a strong signal to the executives who run these firms that such compensation will not be tolerated.”

Meanwhile, Rep. John Lewis, said Thursday that his research shows that at least 13 firms that have received the biggest bailouts owe more than 220 million dollars in back taxes – a violation of the contract they signed with the U.S. Treasury.

“Are they signing contracts knowing that they owe taxes but thinking they will not get caught?” Lewis said during a House subcommittee hearing. “Did then-secretary Paulson turn a blind eye? Either way, this is shameful. It is a disgrace.”

“Taxpayers have no sense that there is any control over this money. They have no idea what, if anything, they will get in return. This entire programme is based on trust – trust in the givers and trust in the takers. At this point, there is no trust,” Lewis said.

A controversy has erupted within the Barack Obama administration about the bonuses, and who knew about them.

Special Inspector General Neil Barofsky told the House Financial Services Committee Thursday that the Bush administration’s Treasury Department and AIG negotiated the bonuses in November 2008.

And AIG says it also gave notice last year to the Security and Exchange Commission that it planned to handout bonuses in 2009, and then told the New York Federal Reserve in January about the bonuses, led Timothy Geithner, since appointed head of the U.S. Treasury.

Neither the commission nor Geithner intervened or gave a heads up to President Barack Obama of the bonuses. Geithner has said he learned that the bonuses were going to be made on March 10 and that he couldn’t stop them. Obama was told Mar. 12 of the impending bonuses, Geithner says.

Excerpt:

By Adrianne Appel
BOSTON, Mar 11 2009 (IPS)

Many of the biggest mortgage lenders in the U.S. have engaged in widespread, systematic schemes that ripped off hundreds of thousands of families seeking to buy a home, refinance or foreclose, according to lawsuits filed on behalf of consumers.

Scores of class-action lawsuits, from the 1990s and up to today, detail the illegal and questionable practices used by mortgage-lending companies that pushed millions into bad mortgages, then into bad refinancing loans and then into foreclosures with unfair fees.

The lawsuits have been filed by private attorneys and state attorneys general, and on behalf of NGOs.

Ameriquest, Countrywide Financial, H&R Block and Option One, HSBC Finance and Wells Fargo are just a few of the companies that have been sued – some repeatedly – for masterminding or carrying out plans to defraud families.

“Many of the mortgage lenders taking advantage of people today are those who were the biggest perpetrators last time around,” Jim Campen, executive director of Americans for Fairness in Lending, told IPS.

HSBC, Britain’s largest bank, and its entities Household International and Household Financial and Beneficial, wrote hundreds of thousands of sub-prime loans in the U.S. that have been the subject of multiple class-action lawsuits.

The company has gotten into trouble for its mortgages and consolidation loans aimed at people who are low-income.

It was sued in 2002 by attorneys general and paid 484 million dollars into a fund for harmed homeowners in all 50 states. It later settled with ACORN, and later with private attorneys. Complaints against the company are ongoing, according to Fair Finance Watch, an NGO.

Last week HSBC, which operates in Canada and recently expanded to India and Brazil, announced it planned to shut down its mortgage-related business in the U.S. due to a high rate of delinquency on its mortgages. It will lay off 6,100 U.S. workers.

According to a lawsuit filed in Illinois, HSBC found customers by scanning lists of people who held mortgages and also had high credit card balances with K-Mart, Best Buy, Costco and other retailers affiliated with HSBC that provided the lists.

After aggressive mailings and phone calls, HSBC would “trick” the homeowners into providing their Social Security numbers, which allowed HSBC to gain access to their complete credit histories, and use the information to talk people into high-interest consolidation loans, the suit says.

The loan amounts were so high – and with interest up to 20 percent – that they often far exceeded the value of the homes, and made it impossible for the family to ever refinance with a competitor, according to the lawsuit.

HSBC settled that lawsuit, denying any wrongdoing. It has since been sued by ACORN, the grassroots organisation, and others.

HSBC has plenty of company.

“There are dozens and dozens of cases against Countrywide,” class-action attorney Jeffrey Norton told IPS. He is suing Countrywide on behalf of thousands of plaintiffs who are being charged unfounded fees during loan modifications and foreclosure.

“When someone gets a loan modification agreement, there is one line that says ‘fees.’ It can be anywhere from hundreds to thousands of dollars. No one can get answers as to what the fees are comprised of,” Norton said.

After receiving many complaints, the National Association for the Advancement of Coloured People (NAACP) filed suit against HSBC, Countrywide and 17 other big-name lenders in 2007, for charging higher mortgage interest rates to people of colour.

The suit, still underway, may help correct the “egregious, demoralising practices that too often turn the so-called American dream of homeownership into a nightmare,” said NAACP chairman Julian Bond.

Named in the suit are: Ameriquest, Accredited Home Lenders, Bear Sterns, BNC Mortgage, CitiMortgage, Encore Credit, Fremont Investment & Loan, First Horizon, First Franklin Financial, GMAC, JP Morgan, Long Beach Mortgage Company, National City, Option One, Suntrust Mortgage, Washington Mutual, Inc. and WMC Mortgage Corporation.

“If Congress did a better job this could have been prevented,” Odette Williamson, staff attorney at the National Consumer Law Centre, told IPS about predatory lending. Housing advocates first noticed an escalation of discrimination and abuse in mortgage lending in the 1990s and brought their concerns to Congress.

“We hope that with the folks in there now that they realise the importance of getting stronger protection for consumers on the books, so we can prevent the next round of predatory lending,” Williamson said.

ACORN said it backs President Barack Obama’s foreclosure prevention plan.

“President Obama hit a home run with his proposal,” said Bertha Lewis, ACORN CEO. She said, however, homeowners need immediate protection from foreclosure and predatory lenders.

Cash-strapped attorney generals offices across the U.S. have devoted significant time and money to suing large lending corporations and trying to stop the abuses.

“It is a main priority for attorney generals,” Amie Breton, spokeswoman for the Massachusetts attorney general, told IPS.

Attorney generals recently won a 325-million-dollar settlement against Ameriquest, which writes the most sub-prime loans in the U.S., due to nationwide, predatory lending.

“The abuses were systemic in nature and number – tens of thousands of victims nationwide – and the damage was catastrophic in real life, human terms,” said Connecticut Attorney General Richard Blumenthal.

“Consumers lost their homes because they could not afford interest rates on loans after Ameriquest fabricated income and inflated appraisals and trapped them with inadequately disclosed pre-payment penalties,” Blumenthal said.

Ameriquest routinely fabricated consumers’ income by claiming that recipients had phony “sewing” or “lawn” businesses. The company even claimed that an elderly Connecticut woman had a sewing business, even though she was blind, according to the Connecticut attorney general’s office.

A suit underway by the attorney general in Massachusetts says that H&R Block and its affiliate Option One charged closing costs to black and Latino mortgage customers that were up to four times those charged to whites, on top of a mortgage with high interest.

“We are alleging that H&R Block had people going to places of worship in certain neighbourhoods trying to get black and Latino borrowers into these loans,” Breton said.

If a family fell behind in its payments of the high-interest mortgage, H&R Block affiliate Option One called them and threatened immediate foreclosure, unless full back payment and substantial fees were paid within 48 hours, the suit says.

No receipt or documentation was sent to the distressed families who made the back payments, the suit says.

Then, new loan terms were drawn up by Option One that were more onerous than the original mortgage, such as placing the home in foreclosure if for the life of the new loan the family was late in paying by just one day.

“Top to bottom these loans were destined to fail,” Breton said.

The Massachusetts attorney general has issued a temporary injunction against H&R Block, preventing it from foreclosing on any homes.

Excerpt:

By Adrianne Appel
BOSTON, Jan 29 2009 (IPS)

The global economy is barely showing a pulse, and the world’s poor are especially at risk, the International Monetary Fund declared Wednesday.

“We now expect the global economy to come to a virtual halt,” in 2009, said IMF Chief Economist Olivier Blanchard.

The IMF released its latest report as leaders of the world’s richest companies and nations were meeting in Davos, Switzerland for the annual and exclusive World Economic Forum, and activists, indigenous peoples and progressive NGOs gathered in northern Brazil at the World Social Forum, to brainstorm about alternative economies.

The IMF predicted the world economy will grow just 0.5 percent in 2009, down from 3.8 percent in 2008. It is the slowest growth in 60 years.

According to the U.N.’s International Labour Organisation, 30-50 million jobs worldwide may be lost if the recession continues through this year.

The wealthy U.S. is home to tens of millions of poor and low-income people, and they are especially endangered by the downturn, advocates here say.

In Boston, Massachusetts, in the north of the U.S., it is winter, when temperatures stay below 0 C for three months or more.

“There is a risk of death here without heat,” John Drew, the executive vice president of ABCD, Action for Boston Community Development, told IPS. The agency helps thousands of families pay their heating bills, so they can stay warm through the winter, he said.

ABCD assists 80,000 poor people in Boston, a glitzy city of 600,000 in a region known as a centre for biotechnology, finance and universities. Many of the people work full-time but don’t earn enough to pay for food, rent, heat, medical care and clothes, Drew said.

According to the U.S. Department of Agriculture, 36 million people in the U.S. in 2007 were not paid enough to buy enough food.

These include people who work in low-wage jobs in Boston’s hotels and restaurants. The service industry employs 14 million people nationwide who earn an average, poverty-level wage of 470 dollars per week, according to the Bureau of Labour Statistics.

With the recession, ABCD is assisting many more people than usual, with food, shelter and emergency heat.

“We helped 15,000 people with fuel assistance last winter. This year we are already at 20,000,” with two more months of winter to go, he said.

“We have people coming in for the first time. There are no jobs,” he said. “And at a time when people go to the state government for help, the government is cutting services.”

Massachusetts is among many of the 50 states that are in deep financial trouble as a result of the recession or their poor investments in hedge funds and trading. ABCD, like other NGOs, rely on state funding to survive. Tuesday, ABCD was waiting word on whether its funding may be cut.

Regardless, “We’re going to try to hold it together,” Drew said.

The global economy is being dragged down by 2.2 trillion dollars in worthless assets created by Wall Street, and held by banks the world over, the IMF said.

The assets are based on many risky mortgages made in the U.S and Europe under questionable terms. The world’s banks, seeking fast profits, engaged in high-flying trading of the assets. Now that millions of the mortgages are in default, the value of the assets has plummeted.

Governments in Europe and the U.S. have handed over billions to the ailing banks to try to prevent their collapse. Despite the cash, the biggest banks are not willing to lend at normal levels and the entire trade and credit economy has slowed way down.

About 2.6 million people in the U.S. lost their jobs in 2008, and tens of thousands more have been laid off in January.

The U.S. overall jobless rate now stands at 7.2 percent, with pockets of very high unemployment of 20 percent or more among certain groups, including young black men without a high school degree, and in Michigan, where the auto industry has laid off thousands.

Consumers are not spending and prices of goods are beginning to drop, bringing fears of deflation.

President Barack Obama called the economic situation “perilous” and in need of immediate attention. He has drafted an 819-billion-dollar stimulus bill that was approved 244-188 by the House of Representatives Wednesday in a sharply partisan vote – not a single Republican voted in favour – and must now pass the Senate.

“We don’t have a moment to spare,” Obama said Wednesday.

In New Orleans, the Dragon Café soup kitchen at St. George Episcopal Church is doing its usual, brisk business, serving up a free, hot meal to 125 people twice a week in this university neighbourhood. Many are regulars.

“A lot of the folks we see here are getting paid by their day jobs. For them to buy a cheap meal at a restaurant would be five dollars. This saves them the five dollars. This is a home cooked meal,” Stan Jahncke, café manager, told IPS.

About one-third of those served are elderly, one-third are low-wage workers and one-third are young people or parents with children, he said.

“We’re seeing about five to six new faces each week,” Jahncke said. “People are asking for money to pay for their utility bills but we don’t do that,” he said.

Excerpt:

By Adrianne Appel
BOSTON, Jan 9 2009 (IPS)

U.S. workers are losing jobs in record numbers, scores of businesses are shuttering and hundreds of thousands of families are newly homeless – and Congress just gave itself a generous pay raise.

Figures released Friday show that 524,000 people in the U.S. were thrown out of work in December, pushing the official jobless rate to 7.2 percent, according to the U.S. Labour Department. This is the highest unemployment rate in 16 years, and economists predict it is likely to climb further. Most of the 2.6 million jobs slashed in 2008 were cut in the final months of the year.

It was also in December that Congress decided it would boost its salaries by 4,700 dollars each for a 174,000-dollar salary this year. The raise will cost taxpayers 2.5 million dollars.

The average U.S. worker who is not a millionaire earned 41,861 dollars in 2005, according to the Economic Policy Institute.

Leaders in the U.S. Congress will earn more, with Speaker of the House Nancy Pelosi at 223,500 dollars, followed by House and Senate leaders, who earn 193,400 dollars.

The raise was granted quietly, by default, due to a law passed by Congress in 1989 that gives them the raise automatically, unless the majority leaders allow it to be debated. Just a handful of lawmakers protested the recent raise, including Rep. Ron Paul, a libertarian who ran for president.

“Turning down our automatic pay increase this year is the least Congress could do to demonstrate fiscal responsibility and solidarity with our constituents in these tough economic times,” Paul said.

Some citizen groups were outraged at the raise.

“As lawmakers make a big show of forcing auto executives to accept just one dollar a year in salary, they are quietly raiding the vault for their own personal gain,” said Daniel O’Connell, chairman of The Senior Citizens League.

“This money would be much better spent helping the millions of seniors who are living below the poverty line and struggling to keep their heat on this winter,” O’Connell said.

In addition to their base salaries, lawmakers also receive hundreds of thousands – or millions if you are a senator – in what are considered legal campaign donations from businesses and individuals, that can be spent on a range of activities, including dinners and parties. The funds can be received and spent anytime, not just during election years.

For example, House Majority leader Steny Hoyer received 3,677,920 dollars from businesses that include JP Morgan Chase and Comcast during 2007 and 2008, according to Open Secrets, which tracks campaign spending.

Hoyer spent almost all the money during that time, even though his seat was not in jeopardy. His one opponent raised just 22,570 dollars.

Among other charges, Hoyer spent 7,023 dollars on catering at the Hotel George in Washington, DC.

Sen. Charles Schumer, a member of two finance-related committees, spent 16 million dollars in campaign donations in 2007 and 2008, and raised more than 13 million dollars. This was not an election year for Schumer, whose seat is safe until 2010. How he spent the money is unknown, because the Senate passed a law recently that exempts them from having to reveal how they spend their donation money.

“The era of the forgotten middle class is over,” Schumer said Thursday. “Everyone should be able to raise a family, send their kids to college, and care for their elderly parents without having to take on a second job or extra shifts.”

“In everything we do, our priorities will be the priorities of working families,” he said.

During 2007 and 2008, the U.S. middle class, hit with job insecurity, rising food prices and soaring mortgage interest rates, cut back drastically on spending like going out to eat and buying new clothes.

Many retailers Thursday reported sales decreases during the fall, and they anticipate a larger decrease for the winter months.

The newly poor are flocking to soup kitchens and homeless shelters, agencies report. Emergency food banks saw a 30 percent increase in requests for food in 2008, according to Feeding America, a coalition of food banks.

Pres.-elect Barack Obama Friday urged Congress to get to work and pass his 750-billion-dollar stimulus package that includes tax cuts and infrastructure improvements, aimed at creating about 3 million new jobs during the next few years.

“For the sake of our economy and our people, this is the time to act, and act without delay,” Obama said.

“If nothing is done, this recession could linger for years,” said Obama, who takes office Jan. 20. Congress is expected to debate the package until at least early February, and to pass it, though the contents of the bill could change.

The Congressional Budget Office painted a grim picture of the coming years, in an economic report it released this week.

It predicted a deep recession that will last well into 2009, and a slow recovery in 2010. The gross domestic product will fall by 2.2 percent in 2009, and increase to just 1.5 percent in 2010. Healthy GDP for the U.S. is considered to be about 3 percent.

People will continue to cut spending into 2010, and unemployment in 2010 will be about 9 percent.

The U.S. government is deep in debt, and it again will have to borrow heavily this year to pay for all commitments, which total more than 3 trillion, not including Obama’s plan. This is 1.2 trillion dollars more than the government has in hand.

The U.S. will have to borrow to finance its 2009 budget, and add significantly to its hefty debt of more than 10.6 trillion dollars.

The U.S. has been carrying a debt for years, but Pres. George W. Bush added significantly to it, adding about 500 billion dollars per year since the start of the Iraq war.

Obama’s plan is built on the assumption that the federal government will not begin to receive robust tax dollars from workers again, until the economy is back on its feet.

“Unless we take decisive action, even after our economy pulls out of its slide, trillion-dollar deficits will be a reality for years to come,” he said Thursday.

Excerpt:

By Adrianne Appel
BOSTON, Dec 31 2008 (IPS)

Warm ocean currents may have confused some 2,500 penguins from Argentina's Patagonia region that washed up – dead and alive – on Brazil's northern coast.

Magellan penguins in the Malvinas/Falkland Islands, in the South Atlantic. Credit: Photo Stock

"Of the live ones, about 50 percent survived," Ruoppolo told Tierramérica.

Magellan penguins (Spheniscus magellanicus) live in relatively warmer climates than other penguin species, and breed and nest in burrows in the southern hemisphere spring and summer, from October to February, in southern Chile and Argentina, in a temperate and dry climate.

They travel out to sea during the winter, from March to September, to follow anchovies, their favourite food, in order to fatten up.

Juveniles also migrate north. This year, about 2,500 disoriented juvenile penguins traveled more than 2,500 kilometres beyond the normal point, coming ashore in Salvador, in Bahia state, 1,400 kilometres north of Sao Paulo, to the amazement of beachgoers. The penguins were rescued by IFAW and the Centre for Marine Animal Recovery, with help from other organisations and Brazilian environmental authorities.

After months of care and feeding, the 372 surviving penguins were banded and loaded onto a C-130 Hercules military plane and transported to Cassino Beach, in Pelotas, in southern Brazil.

After an overnight rest, they were released into the South Atlantic ocean, along with a few other rescued adult penguins, with the hope that they would guide the younger ones safely home to Patagonia.

About 200 people cheered them on as they waded into the surf. It was the largest penguin rescue on record, a success for animal welfare experts – but a terrible omen for the penguin population.

"We always have a few strandings here and there. In 1994 and 2000 we had big strandings. But not like this year. More than 2,000 penguins is unheard of," Ruoppolo said.

Magellans are one of 17 species of penguins, which all live in the southern hemisphere, including the Antarctic. Magellans are among the largest, weighing just over four kilograms, with striking colouring: a white chest and a white band around a black back and black head.

The Magellan penguin population is fragile, as their numbers have plummeted by about 20 percent, with about one million breeding pairs today, according to the Wildlife Conservation Society. The penguins are at risk due to the effects of climate change, tourism, oil leaks from tankers and shrimp nets.

"We are going to try and understand what happened," using the identification bands as a tool, Ruoppolo said.

Once the penguins reach their home colonies, volunteers and researchers there will notify Ruoppolo. She will aggregate data about the climate, ocean currents and food sources, to learn about the strandings.

"One thing that was different is that the surface of the Atlantic ocean was one degree Celsius warmer. The penguins follow the fish, especially their favourite, the anchovies. Probably what happened this year is the anchovies went deeper into the ocean for the cold water. And the penguins couldn't reach their food and they stranded because they were starving," she said.

However, Ruoppolo warned, "We don't know yet if we can link the strandings to climate change. Soon we will be able to say."

According to Sybille Klenzendorf, a scientist with the World Wildlife Federation (WWF), "It's probably not going to be unusual for some of these things to happen," given the rise in temperature of the ocean.

The ocean environment of the southern tip of Patagonia especially is undergoing alterations, Klenzendorf said. Due to glaciers melting, the salinity of the water there is changing.

"The salt content is becoming less. It's not just the temperature that is changing," she told Tierramérica.

WWF scientists recently warned that allowing the earth's surface temperatures to rise an average 2 degrees Celsius further – which is expected within 50 years even with a reduction in greenhouse gas emissions – will severely endanger Emperor (Aptenodytes forsteri) and Adelie (Pygoscelis adeliae) penguins and other Antarctic wildlife.

The current targets for reducing greenhouse emissions "aim at stabilising the climate at 2 degrees higher than it is today. But what we're saying is we need to be more conservative than 2 degrees," Klenzendorf said.

Furthermore, stress from the ocean changes would exacerbate an already dwindling source of fish for the penguins, due to aggressive commercial fishing in the region, she said. During nesting season, male penguins are swimming further each day to feed, compared to their normal forays, according to P. Dee Boersma, a penguin expert at the University of Washington.

Boersma, who has a research station in Punta Tombo, home to the largest colony of Magellan penguins, on the coast of the southern Argentine province of Chubut, says the changing climate has included more rain in recent years.

Coastal Patagonia is normally very dry, and the increasing rains mean that wet penguin chicks die of exposure, Boersma says in research published recently in the journal BioScience.

"Penguins are sentinels of the marine environment, and by observing and studying them, researchers can learn about the rate and nature of changes occurring in the southern oceans," she says.

Punta Tombo is a tiny peninsula near the city of Rawson. Its widest point is less than one kilometre, and it is teaming and crowded with penguins – and tourists – during breeding season. About 105,000 people visited the penguin colony in 2007. Local efforts are underway to protect the penguins from further encroachment.

In 1982, the Punta Tombo colony was saved from Japanese commercial interests, which wanted to slaughter the birds and use their pelts to make golf gloves. The area was turned into a penguin preserve and research centre, led by Boersma.

(*This story was originally published by Latin American newspapers that are part of the Tierramérica network. Tierramérica is a specialised news service produced by IPS with the backing of the United Nations Development Programme, United Nations Environment Programme and the World Bank.)

Excerpt:

Climate change could be the cauBOSTONse of an unprecedented stranding of thousands of penguins on the coast of Brazil, say researchers.

Magellan penguins in the Malvinas/Falkland Islands, in the South Atlantic. - Photo Stock

About half the penguins that were found on Brazilian beaches in October were dead, and the others were starving and in very bad shape, said Valeria Ruoppolo, an emergency veterinarian with the International Federation for Animal Welfare (IFAW), in Sao Paulo, who coordinated the rescue of many of the penguins.

“Of the live ones, about 50 percent survived,” Ruoppolo told Tierramérica.

Magellan penguins (Spheniscus magellanicus) live in relatively warmer climates than other penguin species, and breed and nest in burrows in the southern hemisphere spring and summer, from October to February, in southern Chile and Argentina, in a temperate and dry climate.

They travel out to sea during the winter, from March to September to follow anchovies, their favorite food, in order to fatten up.

Juveniles also migrate north. This year, about 2,500 disoriented juvenile penguins traveled more than 2,500 kilometers beyond the normal point, coming ashore in Salvador, in Bahia state, 1,400 kilometers north of Sao Paulo, to the amazement of beachgoers.

The penguins were rescued by IFAW and the Center for Marine Animal Recovery, with help from the Brazilian environmental authority and other organizations.

After months of care and feeding, the 372 surviving penguins were banded and loaded onto a C-130 Hercules military plane and transported to Cassino Beach, in Pelotas, in southern Brazil.

After an overnight rest, they were released into the South Atlantic ocean, along with a few other rescued adult penguins, with the hope that they would guide the younger ones safely home to Patagonia.

About 200 people cheered them on as they waded into the surf. It was the largest penguin rescue on record, a success for animal welfare experts — but a terrible omen for the penguin population.

“We always have a few strandings here and there. In 1994 and 2000 we had big strandings. But not like this year. More than 2,000 penguins is unheard of,” Ruoppolo said.

Magellans are one of 17 species of penguins, which all live in the southern hemisphere, including the Antarctic. Magellans are among the largest, weighing just over four kilograms, with striking coloring: a white chest and a white band around a black back and black head.

The Magellan penguin population is fragile, as their numbers have plummeted by about 20 percent, with about one million breeding pairs today, according to the Wildlife Conservation Society. The penguins are at risk due to the effects of climate change, tourism, oil dumping from tankers and shrimp nets.

“We are going to try and understand what happened,” using the identification bands as a tool, Ruoppolo said.

Once the penguins reach their home colonies, volunteers and researchers there will notify Ruoppolo. She will aggregate data about the climate, ocean current and food sources, to learn about the strandings.

“One thing that was different is that the surface of the Atlantic ocean was one degree Celsius warmer. The penguins follow the fish, especially their favorite, the anchovies. Probably what happened this year is the anchovies went deeper into the ocean for the cold water. And the penguins couldn't reach their food and they stranded because they were starving,” she said.

However, Ruoppolo warned, “We don't know yet if we can link the strandings to climate change. Soon we will be able to say.”

According to Sybille Klenzendorf, a scientist with the World Wildlife Federation (WWF), “It's probably not going to be unusual for some of these things to happen,” given the rise in temperature of the ocean.

The ocean environment of the southern tip of Patagonia especially is undergoing alterations, Klenzendorf said. Due to glaciers melting, the salinity of the water there is changing.

“The salt content is becoming less. It's not just the temperature that is changing,” she told Tierramérica.

WWF scientists recently warned that allowing the earth's surface temperatures to rise an average 2 degrees Celsius further — which is expected within 50 years even with a reduction in greenhouse gas emissions — will severely endanger Emperor (Aptenodytes forsteri) and Adelie (Pygoscelis adeliae) penguins and other Antarctic wildlife.

The current targets for reducing greenhouse emissions “aim at stabilizing the climate at 2 degrees higher than it is today. But what we're saying is we need to be more conservative than 2 degrees,” Klenzendorf said.

Furthermore, stress from the ocean changes would exacerbate an already dwindling source of fish for the penguins, due to aggressive commercial fishing in the region, she said. During nesting season, male penguins are swimming further each day to feed, compared to their normal forays, according to P. Dee Boersma, a penguin expert at the University of Washington.

Boersma, who has a research station in Punta Tombo, home to the largest colony of Magellan penguins, on the coast of the southern Argentine province of Chubut, says the changing climate has included more rain in recent years.

Coastal Patagonia is normally very dry, and the increasing rains mean that wet penguin chicks die of exposure, Boersma says in research published recently in the journal BioScience.

“Penguins are sentinels of the marine environment, and by observing and studying them, researchers can learn about the rate and nature of changes occurring in the southern oceans,” she says.

Punta Tombo is a tiny peninsula near the city of Rawson. Its widest point is less than one kilometer, and it is teaming and crowded with penguins — and tourists — during breeding season. About 105,000 people visited the penguin colony in 2007. Local efforts are underway to protect the penguins from further encroachment.

In 1982, the Punta Tombo colony was saved from Japanese commercial interests, which wanted to slaughter the birds and use their pelts to make golf gloves. The area was turned into a penguin preserve and research center, led by Boersma.

By Adrianne Appel
BOSTON, Dec 24 2008 (IPS)

Despite hundreds of billions of dollars thrown at banks large and small, the U.S. economy is in a free fall, just weeks before President-elect Barack Obama takes office, analysts say.

“Most measures of economic and financial activity look like they fell off a cliff in September and October, and have been deteriorating at an alarming rate ever since,” says Nariman Behravesh, chief economist at IHS Global Insight.

The bank bailout, which now stands at 335 billion dollars, was supposed to ease credit lending, and jumpstart the economy. But U.S. businesses and individuals report that they are still unable to get loans from banks, and new reports show the economy in very bad shape.

“The bailout hasn’t succeeded. The problem is the diagnosis of it as a ‘financial crisis’. It is a toxic stew of subprime mortgages that is the problem, and its consequences are to poison the well of finance. Pouring capital into the banks doesn’t fix it,” Jamie Galbraith, an economist at the University of Texas, told reporters recently.

Galbraith and 120 other economists, progressives and labour leaders sent a letter to Obama urging him to spend 900 billion dollars or more starting in the New Year, to stimulate the economy.

“This crisis is unprecedented since the Great Depression. It will take unprecedented measures,” Galbraith said.

Government figures released Tuesday show the overall economy has almost stalled, and between July and September grew at an annually adjusted rate of just 0.5 percent, as measured by the Gross Domestic Product. Healthy GDP growth for the U.S. is considered to be 3 percent or more per year.

Economists estimate that the current GDP is declining at 6 percent.

New unemployment claims for the week ending Dec. 20 were 586,000, the highest since November 1982, according to the U.S. Labour Department Wednesday. About 4.3 million people nationwide are already receiving unemployment benefits, said to be just a fraction of those actually unemployed, due to the restrictions placed on receiving benefits.

The public cut spending in November by 0.6 percent, after cutting spending 1 percent in October, according to the Commerce Department Wednesday.

More than 2 million people have been thrown out of work this year, and it’s estimated that 12.5 percent of previously fully employed people are now “underemployed”. One out of 10 mortgages are delinquent in payments.

“The United States is now officially in a recession that started in December 2007. Japan and many European countries are in the same boat,” Behravesh says, adding that markets in the developing world will “decelerate dramatically”.

“We are experiencing a fundamental collapse of the basic mechanisms of trust and exchange at the heart of the credit system,” Galbraith said.

Obama has said he wants to stimulate the suffering U.S. economy by delivering hundreds of billions, possibly close to a trillion dollars, in infrastructure projects with the goal of creating 3 million new jobs over two years, and tax cuts, plus food and unemployment programs for those who need it.

“My administration will be absolutely committed to the future of America’s middle-class and working families,” Obama said Sunday.

Incomes of working people didn’t increase during the George W. Bush years of 2000 to 2007- they decreased by about 2,000 dollars each, Obama has said.

More recently, those with 401(K) retirement accounts have lost 2 trillion dollars this year, as the stock market has plunged 40 percent, Obama noted.

Obama and Vice President-elect Joe Biden are putting the finishing touches on the package, and working with the Democratic leadership in Congress to craft a bill that will pass Congress, and land on Obama’s desk for signing within days of him taking office, on Jan. 20. Congress returns Jan. 6.

Biden said Sunday that the billions are needed immediately to keep the economy from worsening.

“Every economist that I’ve spoken to … from well-known economists on the right, conservative economists, to economists on the left, and everyone in between, says the scope of this package has to be bold; it has to be big,” Biden said on ABC This Week.

“They are well advised to do too much than too little. We can always scale back. We should get a very large programme in place,” Galbraith said.

“There are a whole bunch of anxious and angry workers wondering why we keep throwing money at the people who have created the mess,” said Leo Gerard, president of the United Steel Workers, who also signed the letter.

“We’re going to take to the streets if Republicans try to block this,” Gerard told reporters.

“We have 850,000 members in two countries. Any Democrat or Republican that tries to put a stick in the spokes of this wheel is going to have problems in the next election,” Gerard said.

In addition to the stimulus package, the new Treasury secretary may have access to about 350 billion dollars in bailout funds that remain of the 700 billion dollars Congress approved in October.

Excerpt:

By Adrianne Appel
BOSTON, Dec 17 2008 (IPS)

A new U.S. investigative panel is demanding answers from the U.S. Treasury about how the agency has spent money from the 700-billion-dollar bailout fund.

The Congressional Oversight Panel, a four-person board authorised by Congress and led by consumer advocate Elizabeth Warren of Harvard Law School, is charged with finding out what Treasury has done with the billions it has already spent.

“We are here to ask the questions that we believe all Americans have a right to ask: who got the money, what have they done with it, how has it helped the country and how has it helped ordinary people?” the panel says in its first report, which lays out its work.

The panel has begun gathering documents from Treasury and also is holding a series of public meetings across the U.S., to hear the public’s concerns about the bailout and the economy. The panel expects to have some answers for Congress and the public by Jan. 9, when it will issue a report on its website, cop.senate.gov.

“We will be running very hard over the next 40 days,” Warren told members of Congress recently. Also on the panel are Rep. Jeb Hensarling, a Republican from Texas; Richard Neiman, Superintendent of Banks in New York; and Damon Silvers, a lawyer with AFL-CIO.

“The recession has visited every household in the country. More than 100,000 families last month headed into bankruptcy courts. Americans are watching Washington’s every move with great concern,” Warren said.

In a desperate attempt to ease lending, the Federal Reserve Tuesday dropped the federal funds interest rate to between 0 and .25 percent, the lowest in decades.

The Warren panel lacks subpoena power but will work together with Special Inspector General Neil M. Barofsky, who will wield significant legal power, and the General Accounting Office, in auditing and overseeing the funds.

“The public has a right to know how financial institutions that have received public money are using that money,” the panel says. “Treasury should be responsible for holding individual institutions accountable for how they use the public’s money.”

After considerable protests from the public, legislators approved on Oct. 3 700 billion dollars in special funding for the U.S. Treasury, which was requested by Treasury Secretary Henry Paulson who said the funds were needed to prevent a wholesale collapse of the U.S. financial sector.

Paulson has since doled out the equivalent of 1,900 dollars per U.S. family to banks and financial institutions, according to Warren’s panel. None of the Treasury funds have been aimed at slowing foreclosures.

Paulson gave 40 billion dollars to insurance giant AIG, 165 billion dollars to 87 banks, including Citigroup and eight other of the largest financial institutions in the U.S., plus an additional 20 billion dollars to Citigroup. The nine large banks were required to give the U.S. a limited amount of stock and returns in exchange for the money.

The Treasury bailout programme, run by Assistant Secretary Neel Kashkari, did not require the banks to use the money in any particular way. Kashkari told Congress recently that Treasury has not audited the money to see how it is being spent.

“There is a casual impression that this money is being used to pay bonuses for top executives and dividends for shareholders,” James Crotty, professor emeritus in economics at the University of Massachusetts, told IPS.

“There are ways to measure what’s happening to the lending. This may be something to question Treasury vigorously about,” Warren said. Great Britain has kept track of its bank bailout money, and required concessions, unlike the U.S., she said.

“The money was given to financial institutions in return for those institutions to lend to small and medium enterprises. There was an explicit quid pro quo,” she said.

Paulson and Kashkari, both formerly of Goldman Sachs, have spent additional millions to hire private firms and some of the same institutions that received bailout money, to help administer the bailout programme.

Much secrecy surrounds the spending of the money, with the amount of money in some contracts blackened out and the work actually underway by the contractors not described or audited.

“We are disturbed that so much of [the bailout] activities are opaque. There is a lack of adequate oversight and a lack of transparency,” Beverley Lumpkin, an investigator with the Programme on Government Oversight, a Washington non-profit, told IPS. POGO praises the panel’s work so far.

“We like the questions they ask. We feel they are pretty much tracking the major questions that need to be looked at,” Lumpkin said.

Despite the spending of these funds and more than two trillion by the U.S. Federal Reserve, the economy remains in turmoil, marked by job losses and climbing unemployment, business closings, more than 2 million home foreclosures in 2008 and a severe drop in the value of the stock market.

“The funds haven’t done what they are supposed to do. They hoped interest rates would come down and that loans would take place. It doesn’t appear that either of those things have happened,” Crotty said.

The nation’s largest banks are not loaning money to each other out of fear that they will lose it if a bank defaults, due to their heavy investment in risky, unregulated products based on mortgages with sky-high interest rates and unfair terms, many of which are now in foreclosure and without value. This in turn has crimped loans to businesses and brought the economy almost to a halt.

“Virtually all the things that indicate the health of the economy are deteriorating rapidly. Everything looks horrible at the moment,” Crotty said.

Excerpt:

By Adrianne Appel
BOSTON, Nov 19 2008 (IPS)

A congressional banking leader Tuesday blew hot air and blame at the U.S. treasury secretary about the ongoing home foreclosure crisis, but neither made a commitment to help stressed homeowners.

Congress is officially out of session, except for this week, and has no plan to address the looming problem of foreclosures until it returns in January, when Pres.-elect Barack Obama takes office.

Congress would have full authority to do so.

Instead, Rep. Barney Frank, chair of the House Financial Services Committee, told Treasury Secretary Henry Paulson that he should address the foreclosure problem and direct money from a special 700-billion-dollar fund to homeowners in trouble.

“It is essential that we do something, that we use some of the [funds] toward foreclosure reduction,” Frank said.

Paulson, a lame-duck secretary who will leave in January when Pres.-elect Obama appoints a new secretary, said he knows how he is going to spend the remaining funds, and foreclosure assistance and an auto industry bailout is not part of his plan.

Congress has been apprised of Paulson’s spending, has vast authority over it, and could have directed him to intervene on behalf of homeowners.

Congress handed the 700 billion dollars to Paulson on Oct. 3, after Paulson said the emergency money was urgently needed to prevent a wholesale collapse of the U.S. banking system and economy. The U.S. public was highly critical of the plan, and called Congress by the thousands, but legislators, led by Frank and other Democrat leaders, authorised the money.

Without help, five million U.S. homes will be lost to foreclosure in the next two years, according to the Federal Deposit Insurance Corporation. Two million have already been foreclosed on.

Committee member Maxine Waters expressed anger that she helped win votes for the 700 billion dollars, which she said she thought would be spent on foreclosure assistance.

“I worked very hard to pass this [bailout] legislation. I was looked at with suspicion when I sold this to the Congressional Black Caucus. I am disappointed you have just divorced yourself from dealing with foreclosures,” Waters told Paulson.

Paulson, formerly of Goldman Sachs, has spent the funds directly on financial firms, and spent hundreds of millions to hire financial firms to disperse the money, and track it.

“We are turning the corner. We have stabilised the system and prevented a collapse. We have a lot of work ahead. It’s a lot of work to get the markets going again,” Paulson said.

Paulson has given 125 billion dollars in cash to nine of Wall Street’s largest firms, in exchange for limited stock, and 148 billion dollars so far to other smaller banks.

“You, Secretary Paulson, took it upon yourself to ignore the authority and direction that Congress gave you. I couldn’t believe it when I heard that you abandoned the foreclosure effort,” Waters said.

Paulson expects to spend up to 350 billion dollars before he leaves office, and said the remainder will be directed to credit card companies, and businesses that make auto and education loans.

None will go toward foreclosure assistance or the auto industry, he said.

“I feel a great responsibility to stick with the purpose of the [fund], to stabilise and strengthen the financial system. Auto companies fall outside that purpose,” Paulson said.

“Why are foreclosures still increasing, in light of the 700 billion dollars spent at taxpayers’ expense?” Rep. Nydia Velazquez asked Paulson.

“It’s hard to imagine we’re not going to have a large number of foreclosures when you look at what we’ve gone through, and the shoddy lending practices,” Paulson said.

Sheila Bair, chairwoman of the Federal Deposit Insurance Corporation, has a plan in hand to help homeowners, and told Frank and Paulson she needs 24 billion dollars to get it started. It appears homeowners may have to wait until January for Congress or the Treasury to consider funding it.

None of the powerful congressional leaders nor Paulson has stepped forward to propose funding for it.

Frank told Paulson that he should address the foreclosure problem.

“The fundamental policy issue is our disappointment that funds are not being used out of the 700 billion dollars to supplement mortgage foreclosure reduction,” Frank said.

Waters expressed frustration that Paulson has refused so far to fund Bair’s plan, and said it is badly needed. Mortgage holders are not voluntarily trying to re-negotiate their unfair loans, she said.

Waters’ office is trying to help 26 homeowners to re-negotiate lower interest rates on unfair loans.

“It is absolutely ridiculous. One of the banks is Wells Fargo. I’ve had to go all the way to the chairman. I stay on the line for one hour just trying to get to a servicer. Then when you talk to the servicer, they don’t even know enough to evaluate the incomes of the owners,” she said.

The foreclosures are at the centre of the financial meltdown, and unless stemmed, will continue to drag down the U.S. and global economy, economists told the panel.

“Stopping the financial crisis and getting credit flowing again requires ending the spiral of mortgage foreclosures and the expectation of very deep further house price declines,” said Martin Feldstein, of Harvard University.

Alan Blinder, an economist at Princeton University, painted a bleak picture of the next year.

“The hope that we might avoid a serious recession is now gone,” he said.

Blinder said that if the U.S. takes aggressive action by spending billions on infrastructure and other projects, the country may be able to hold unemployment at 8 percent. It currently stands at 6.5 percent.

Excerpt:

By Adrianne Appel
BOSTON, Nov 14 2008 (IPS)

Nearly five weeks after Congress gave the nod to a 700-billion-dollar bailout fund, and as the economy sinks deep into a recession, no definite plan is in sight for struggling U.S. homeowners.

“We have the potential for a true economic disaster,” said Susan Wachter of the Wharton School of Economics, at a congressional hearing Thursday.

“Let us remind ourselves that the problem came from housing,” she said.

It is unclear how help will be delivered to U.S. homeowners, who are defaulting on loans at record rates.

“The foreclosure problem is getting worse, not better,” said Martin Eakes, CEO of Self Help and Centre for Responsible Lending, a non-profit, community development organisation, on Thursday, at the hearing of the Senate Banking, Housing and Urban Affairs Committee.

Congress meets next week to decide whether to dole out 25 billion dollars or more to the auto industry, and maybe craft a bill to assist the unemployed and create jobs. But there is no congressional plan on the table to assist homeowners. Congress may then recess until January.

Treasury Secretary Henry Paulson, who is in charge of disbursing the 700 billion dollars, said Wednesday that his next target for funds is the credit card, student loan and auto loan industries, but not homeowners.

“We continue to explore ways to reduce the risk of foreclosure,” he told reporters. Paulson mentioned a new programme underway by the quasi-public mortgage lenders to make new loans currently being written more fair. The private lending industry is being encouraged to voluntarily follow suit, Paulson said.

Sheila Bair, chairwoman of the Federal Deposit Insurance Corporation, has drafted an aggressive plan for assisting homeowners in trouble, based on the idea that monthly mortgage payments should not be more than 31 percent of the household income. That plan appears stalled, possibly on hold until January and a new administration.

On Jan. 20, Barack Obama will become president, and his cabinet will have control of the remainder of the 700 billion dollars, probably about 350 billion dollars. It is not known if Obama also would tap the Treasury fund to help homeowners. Obama backs the idea of letting bankruptcy courts modify loans in foreclosure.

Eakes said he supports Sheila Bair’s proposal, and Obama’s idea that judges should be allowed to modify mortgages.

Lenders need a mandate, because they are not voluntarily working out better terms on troubled mortgages, Eakes said. Credit Suisse, a large mortgage lender, reported recently that it modified just 3.5 percent of delinquent subprime loans in August, its most recent figures, he said.

Until foreclosures are stemmed, the overall economy will not be able to dig itself out of trouble, Wachter said.

“The economic downturn could become ever more severe due to the interaction of financial market stress with declines in house prices and a worsening economy all feeding back into and adverse loop,” Wachter said.

Foreclosure filings increased 5 percent in October, to 279,561 homes, according to RealtyTrac. Arizona, California, Florida, Georgia, Michigan, Nevada, New Jersey, Ohio and Texas saw the highest rate of foreclosures, said the firm.

As the nation heads into the New Year, nearly 3 million families will have lost their homes, and 2.3 million more will be adrift as of the end of 2009, according to an analysis of Mortgage Bankers Association data by Eakes’s group.

“These losses, in turn, are infiltrating nearly every part of American life, from police and fire protection to community resources for education,” Eakes said.

The Organisation for Economic Cooperation and Development announced on Thursday that 30 developed nation economies had sunk into a recession, including Japan, the United States and most of Europe.

Their economic output is expected to shrink through 2009, with the U.S. economy the worst off, said the organisation, based in Paris. The OECD began analysing economies in the 1970s and it is the first time it has seen such a large group of economies simultaneously slide.

The news comes as leaders of the world’s richest 20 nations gather Friday and Saturday at the White House to discuss coordinated efforts to ease their ailing economies, like tax incentives and regulation.

Bush, whose administration has embraced a hands-off, free-market ideology, indicated he would be opposed to efforts to regulate.

“It would a terrible mistake to allow a few months of crisis to undermine 60 years of success,” Bush told reporters Thursday.

Today’s economic crisis can be traced back to unscrupulous actions of some lenders, who wrote millions of mortgages with sky-high interest rates and other unfair terms that homeowners are now unable to meet.

“Today’s financial crisis is a monument to destructive lending practices – bad lending that never before has been practiced on such a large scale, and with so little oversight. Unfortunately, the entire country is paying the price,” Eakes said.

Banks bought and sold the high-risk mortgages, and created complex investment products from them that they traded around the globe, earning record profits. The complex mortgage products and their trading was unregulated. Now that homeowners are defaulting on their loans, many of the investments held by the banks are almost worthless.

“Well before the foreclosure crisis erupted into the public eye and began to dominate news headlines throughout the country, [non-profit organisations] pleaded with Congress, the administration, and the financial services industry to quickly take sweeping measures to keep borrowers in their homes,” noted Nancy Zirkin, president of the Leadership Conference on Civil Rights, at the hearing.

Excerpt:

By Adrianne Appel
BOSTON, Nov 13 2008 (IPS)

Women’s right activists see an open door to the White House of President-elect Barack Obama, and they plan to walk right in and take a seat.

Women celebrate Obama's victory in Washington DC. Credit: scottmontreal

Women activists have a long list of recommendations for Obama, who is viewed as much more receptive to women’s rights than his predecessor.

“It’s a great opportunity to think about policies that will strengthen our agenda, like strengthening families,” said Andrea Batista-Schlesinger, of the Drum Major Institute for Public Policy.

George W. Bush, who leaves office Jan. 20, has imposed many policies that harm the quality of life of women inside and outside of the United States, policies he has said are morally correct and that reflect his personal religious beliefs.

“For eight years, we have suffered under the yoke of an administration that has suppressed science to the detriment of health and has done damage to constitutional and human rights values. Decades of hard-won progress have been eroded,” said Nancy Northrup, president of the Centre for Reproductive Rights, in a letter to Obama, sent the day after he was elected.

Bush has stripped funding for hundreds of health clinics worldwide, restricted sex education and birth control to young women, provided government money to religious fundamentalist organisations for moral teachings on sexual abstinence, and nearly halted scientific research that involves reproducing human cells that are four days old, called embryos.

“We ask that you work toward a nation and world in which all women are free to decide whether and when to have children, where all women have access to quality reproductive health care, where all women can exercise their choices without coercion or discrimination, and where all women can participate with full dignity as equal members of society,” Northrup said.

Obama aides have already said that on his first day in office, the new president will allow scientists to use federal funds for embryonic stem cell research, and that he will repeal what is known worldwide as the “global gag rule”. This Bush rule prevents any health clinic worldwide from discussing or administering abortions if the clinic receives any USAID funds.

Poor nations rely on the funds to provide health care to women, and the gag rule, imposed by Bush on his first day of office in 2001, has proved anything but healthy, says the Centre for Reproductive Rights.

Unsafe abortion is the cause of 55 percent of the deaths of women in Ethiopia, due to a lack of health clinics that can provide abortions, according to the Centre.

“There’s a lot that the president can do using his executive authority without waiting for congressional action, and I think we’ll see the president do that to try to restore a sense that the country is working on behalf of the common good,” said aide John Podesta, speaking to Fox television recently.

From women’s reproductive health care worldwide, to birth control and education, to support for child care and equal pay, women activists from all corners of the U.S. are ready to speak with Obama about what they believe needs to happen.

The National Organisation for Women, the largest feminist group in the U.S., is making it easy for women to contact Obama directly, through its website.

“Now is not the time to sit back and relax. President-elect Obama asks ‘Where should we start together?’ Speak out and tell him!” says the NOW website, which lists equal pay and expanded programmes for poor women among possible recommendations for Obama.

Eleanor Smeal, president of the Feminist Majority Foundation, spoke to women gathered at historic Seneca Falls, New York, and urged them to “think big” about what they would like to see happen in the next four years.

At a “feminist town hall forum”, organised by the Centre for New Words in Boston, women all across the U.S. did just that, after hearing from a panel of women’s rights advocates.

“Think ahead four years from now. How will we know that we were successful?” asked Paula Rayman, an economist at the University of Massachusetts.

Obama’s health reform plan must include access to abortion, and complete reproductive health care, said Loretta Ross, a coordinator of SisterSong, a health collective of women of colour.

“Obama, I assume, has not heard the perspective of black women on this issue. That won’t fly,” Ross said. “Barack needs to know that when you sell out abortion rights, you sell out women. We need to say, ‘The middle ground does not start on my body,”‘ Ross said.

While progressive women are celebrating the possibilities of the next four years, those on the far right are sharpening their agendas as well.

“The potential swing of the Supreme Court to the liberal side is something we need to be very, very aware of. We need to be careful who we let through on these courts,” said Diana Furchtgott-Roth, a senior fellow at the Hudson Institute, at a gathering of conservative women in Washington, DC.

“Democrats are going to try to ram through these policies. We need to make sure we are advocating and our voices are heard. Look at the immigration bill and how talk radio was responsible for undermining that and making sure it did not become the law of the land,” added Kate Obenshain, a Republican Party strategist.

The Catholic leadership wasted no time in vowing to fight abortion rights and funding of stem cell research. Cardinal Francis George, the archbishop of Chicago, denounced the policies as against the common good, at a meeting of U.S bishops earlier this week.

Clear battle lines are being drawn on both sides.

“We should deal the far right wing a major blow,” Smeal said. “We have to make the best use of the next year or two. We must not go back again, so this is our opportunity to move ahead.”

Excerpt:

By Adrianne Appel
BOSTON, Nov 12 2008 (IPS)

The Antarctic holds the world’s largest amount of fresh water in its icy grip, and it is most certainly warming as a result of greenhouse gases, say new scientific studies.

A crabeater seal (Lobodon carcinophagus) floats on ice near Mount Shackleton on the Antarctic Peninsula. Credit: Photo Stock

Evidence of global warming, caused by the release of carbon dioxide and other pollutants into the air, has been found on almost every continent on Earth. The exception was the Antarctic, which holds 90 percent of the world’s ice and 70 percent of the world’s fresh water.

Antarctica, about 1.4 times as large as the United States, has just 20 weather stations from which to gather data, and for this and other reasons, less has been known about the icy continent.

Scientists can see that the warmer parts of Antarctica, including the Western Antarctic and Antarctic Peninsula, which juts north toward South America and is home to millions of seals and penguins and other birds, are seeing temperature increases.

But the frigid East Antarctic, with ice 2,226 metres thick, has seen no significant change in air temperature during the past 50 years – in fact it has shown evidence of cooling – and this has made overall conclusions about the greenhouse gas effect inconclusive.

The Fourth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC) concluded that Antarctica was the only continent where human-caused temperature changes had not been detected, possibly due to insufficient data and observation.

Gillett’s work “demonstrates convincingly what previous studies have suggested: that humans have indeed contributed to warming in both the Arctic and Antarctic regions,” said Andrew Monaghan, of the U.S. National Centre for Atmospheric Research, a close colleague of the researchers.

The team used all data available from 1900 to 2000 from the 20 research stations, and complex computer predictions to reach its conclusions.

The scientists created four computer models, including one that included the impact of greenhouse gases and one that did not. The model with the greenhouse gases produced predictions that matched actual temperature observations up to this point in time, according to their report, “Attribution of polar warming to human influence”, in the scientific journal Nature Geoscience.

Taking averages across all of Antarctica produced findings of “overall warming” of a few tenths of a percent, Gillett said.

But the team found temperature increases on the Antarctic Peninsula of up to 3 degrees Celsius since the 1950s, among the largest increases on Earth, Monaghan said. Still, the average monthly temperature is 1 degree to minus -15 degrees C.

Several large glaciers in the West Antarctic are melting and contributing to a rise in global sea levels, due to warmer ocean currents that are hitting the ice sheets. The average monthly temperature there is -12 C to -35 C.

“This melting of ice shelves has implications for sea level rise,” Gillett said. In 2002, a huge ice shelf on the Peninsula, called the Larsen B, broke apart and melted. It was 3,250 square kilometres in size, he pointed out.

In addition, the team noticed data pointing to a warming along the coasts of East Antarctica, and they expect this warming to accelerate.

Gillett hypothesised that the South Pole cooling may be due to a severe loss of ozone in the Pole’s atmosphere, due to pollution.

He believes that because of his research, scientists can draw a more accurate picture of what the future may look like for Antarctica. Calculations about the melting of ice can now include the impact of global warming.

“We won’t see anything catastrophic in the next century if things continue at the current rate. But the melt could accelerate,” Monaghan said.

The IPCC was unable to include complete and accurate predictions of global sea rise because it did not have adequate Antarctic data. It predicted an increase of between 18 and 59 cm, Gillett said.

In January, IPCC chairman Rajendra Pachauri made a personal plea to scientists to step up their research on Antarctica and Greenland.

“My hope is the next [IPCC] report, if there is one, will be able to provide much better information on the possibility of these two large bodies of ice melting, in what seems like a frightening situation,” Pachauri said.

Research about warming in the Antarctic Peninsula has been building.

Earlier this year, Eric Rignot, of the University of California, reviewed satellite images from 1996 to 2000 and found that ice is definitely melting on the Antarctic Peninsula and in the West Antarctic.

West Antarctica lost about 132 billion metric tons of ice in 2006, compared with about 83 billion metric tons in 1996, Rignot said. The Antarctic Peninsula lost 60 billion metric tons in 2006.

The ice melt would have been enough to raise the world’s sea level by 0.5 mm, if not for a simultaneous ice accumulation in frigid East Antarctica, Rignot said.

Research that shows humans are causing global warming may help bolster efforts to slow the emission of greenhouse gases, primarily by the United States and China, said Meg Boyle, a climate change expert with the environmental watchdog group Greenpeace.

“In the United States, we have a small percentage of the world’s population but we produce 25 percent of the world’s global warming pollution. It is time for us to step up,” she said. She expressed hope that United States President-elect Barack Obama will be more willing to participate in global climate agreements.

(*This story was originally published by Latin American newspapers that are part of the Tierramérica network. Tierramérica is a specialised news service produced by IPS with the backing of the United Nations Development Programme, United Nations Environment Programme and the World Bank.)

Excerpt:

Since 1950, a temperature increase of as much as three degrees Celsius has been recorded on the Antarctic Peninsula — one of the largest temperature hikes on Earth.

A crabeater seal (Lobodon carcinophagus), floats on ice near Mount Shackleton on the Antarctic Peninsula. - Photo Stock

“We're able for the first time to directly attribute warming in both the Arctic and the Antarctic to human influences,” said Nathan Gillett of the University of East Anglia, in Britain, who led the study.

Evidence of global warming, caused by the release of carbon dioxide and other pollutants into the air, has been found on almost every continent on Earth. The exception was the Antarctic, which holds 90 percent of the world's ice and 70 percent of the world's fresh water.

The Antarctic continent, about 1.4 times as large as the United States, has just 20 weather stations from which to gather data, and for this and other reasons, less has been known about Antarctica.

Scientists can see that the warmer parts of Antarctica, including the Western Antarctic and Antarctic Peninsula, which juts north toward South America and is home to millions of seals, penguins and other birds, are seeing temperature increases.

But the frigid East Antarctic, with ice 2,226 meters thick, has seen no significant change in air temperature during the past 50 years — in fact it has shown evidence of cooling — and this has made overall conclusions about the greenhouse gas effect inconclusive.

The Fourth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC) concluded that Antarctica was the only continent where human-caused temperature changes had not been detected, possibly due to insufficient data and observation.

Gillett's work, “demonstrates convincingly what previous studies have suggested, that humans have indeed contributed to warming in both the Arctic and Antarctic regions,” said Andrew Monaghan, of the U.S. National Center for Atmospheric Research, and close colleague of the researchers.

The team used all data available from 1900 to 2000 from the 20 research stations, and complex computer predictions to reach its conclusions.

The scientists created four computer models, including one that included the impact of greenhouse gases and one that did not. The model with the greenhouse gases produced predictions that matched actual temperature observations up to this point in time, according to their report, “Attribution of polar warming to human influence”, in Nature Geoscience.

Taking averages across all of Antarctica produced findings of “overall warming,” of a few tenths of a percent, Gillett said.

But the team found temperature increases on the Antarctic Peninsula of up to 3 degrees Celsius since the 1950s, among the largest increases on Earth, Monaghan said. Still, the average monthly temperature is 1 degree to minus-15 degrees C.

Several large glaciers in the West Antarctic are melting and contributing to a rise in global sea level, due to warmer ocean currents that are hitting the ice sheets. The average monthly temperature there is -12 C to -35 C.

“This melting of ice shelves has implications for sea level rise,” Gillett said. In 2002, a huge ice shelf on the Peninsula, called the Larsen B, broke apart and melted. It was 3,250 square kilometers, Gillett said.

In addition, the team noticed data pointing to a warming along the coasts of East Antarctica, and they expect this warming to accelerate, they said.

Gillett hypothesized that the South Pole cooling may be due to a severe loss of ozone in the poles atmosphere, due to pollution.

Gillett believes that because of his research, scientists can draw a more accurate picture of what the future may look like for Antarctica. Calculations about the melting of ice can now include the impact of global warming.

“We won't see anything catastrophic in the next century if things continue at the current rate. But the melt could accelerate,” Monaghan said.

The IPCC was unable to include complete and accurate predictions of global sea rise because it did not have adequate Antarctic data. It predicted an increase of between 18 and 59 cm, Gillett said.

In January, IPCC chairman Rajendra Pachauri made a personal plea to scientists to step up their research on Antarctica and Greenland.

“My hope is the next [IPCC] report, if there is one, will be able to provide much better information on the possibility of these two large bodies of ice possibly melting, in what seems like a frightening situation,” Pachauri said.

Research about warming in the Antarctic Peninsula has been building.

Earlier this year, Eric Rignot, of the University of California, reviewed satellite images from 1996 to 2000 and found that ice is definitely melting on the Antarctic Peninsula and in the West Antarctic.

West Antarctica lost about 132 billion metric tons of ice in 2006, compared with about 83 billion metric tons in 1996, Rignot said. The Antarctic Peninsula lost 60 billion metric tons in 2006.

The ice melt would have been enough to raise the world's sea level by 0.5 mm, if not for a simultaneous ice accumulation in frigid East Antarctica, Rignot said.

Research that shows humans are causing global warming may help bolster efforts to slow the emission of greenhouse gases, primarily by the United States and China, said Meg Boyle, a climate change expert with the environmental watchdog group Greenpeace.

“In the United States, we have a small percentage of the world's population but we produce 25 percent of the world's global warming pollution. It is time for us to step up,” she said. She expressed hope that president-elect of the United States, Barack Obama, will be more willing to participate in global climate agreements.

By Adrianne Appel
BOSTON, Nov 7 2008 (IPS)

President-elect Barack Obama will inherit an ailing economy and the way to help right it is to spend – and spend some more, independent economists say.

An Obama supporter. Photo taken one week before the election. Credit: Bekit

People and businesses are not buying as much because they can't afford to, Mendelowitz said. They have lost their jobs or fear they may, and the cost of oil, gas and food has risen. At the same time, homeowners are watching the value of their houses sink, and for some, their mortgage payments rise.

What would help now is spending to create jobs, like road repair and alternative energy start-ups, and extending unemployment benefits and food stamps for people out of work, he said.

"People are feeling less secure and feeling poor because they are poor. When people's wealth declines they respond by cutting consumption," Mendelowitz said.

The government needs to get money into the hands of U.S. workers, as quickly as possible, he said. The goal is to get people working and spending again, and paying taxes, Mendelowitz said.

To recommend spending as a way to help the economy may sound like advice tailor-made for a president who espouses progressive ideals, as Obama does.

However, "It has nothing to do with left, right or progressive ideology. It's good economics," Robin Hahnel, professor emeritus of economics at American University, told IPS.

"Even the fiscal conservatives will say that for the first year, or couple of years, there has to be massive amounts of spending," said Theodore Moran, an economist at Georgetown University.

The lame-duck administration of George W. Bush and Congress are leaving behind a 2008 budget that is a trillion dollars over-budget, and added to the U.S. multi-trillion-dollar debt.

In September, Treasury Secretary Henry Paulson secured more than 800 billion dollars from Congress to spend on Wall Street, banks and the largest businesses in the U.S. The banking industry was near collapse, Paulson argued, and needed immediate cash.

Hahnel believes the bailout gives too much latitude to the banks, and not enough back to taxpayers. Obama should direct Paulson to make changes, Hahnel said, even before Obama takes office.

"We already passed the lousy bailout," Hahnel said. But "You can send word to the banks and say 'We are watching and there will be hell to pay if you take advantage of taxpayers between now and Jan. 20'."

Obama should urge Congress to spend as much as possible this year, Mendelowitz said.

"Clearly available funding will be very tight. But you don't want to get fiscal religion, and not spend because you are running a big deficit," Mendelowitz said.

Congress, with a push from Obama, may try to pass a 61-billion-dollar package of job creation funds and unemployment extension, the week of Nov. 17. A similar plan failed in the Senate in September.

The plan dovetails with Obama's "jumpstart the economy" platform, that advocates spending 25 billion dollars for road and bridge repair and sending 25 billion dollars to the states, many of which have begun laying off employees.

Economist Nouriel Roubini of New York University told Congress recently that it needs to spend up to 500 billion dollars, as soon as possible, to prevent the economy from sliding into a deep recession.

Obama should not worry about adding to the U.S. debt, Moran said.

"All sensible economic folks say next year is not the year to balance the budget or even restrain the budget," Moran said. Obama needs instead to stay focused on stimulating the economy by injecting cash into it, he said.

Obama's economic plan is still a rough sketch, with few details and dollar amounts. He says that after he takes office he wants to create jobs by funding the development of alternative energy, and expand the federal health programme to allow the average U.S. worker to buy into it.

Mendelowitz backs this plan, as a sound investment for the long term, and for moral reasons.

Hahnel would caution Obama not to go after a big, new health care programme in the first couple of years, for political reasons, as Hillary Clinton learned. It would take a huge amount of attention and political capital, and would distract him from focusing on pressing economic problems.

Obama is inheriting an economy that is dangerously weak by almost all measures.

"I'm not sure you can call anyone who won this election lucky," Mendelowitz said. "The economy is in the worst shape."

The Gross Domestic Product grew at just .3 percent from July through September, the worst in seven years.

On Thursday, retail stores across the nation released statistics showing a double digit drop in sales during October.

A recent survey of manufacturers put industrial activity at a 26-year low, while the U.S. Labour Department reported that worker productivity stood at 3.6 percent growth in the spring, but fell to 1.1 percent by the end of the summer.

Close to 500,000 homes have been foreclosed and 2.5 million more foreclosures loom.

National unemployment has risen to 6.1 percent, and has been in the double digits in poorer communities and among young people of colour for years.

The government can help by pouring billions into "the real economy" and create jobs, give out tax breaks and tax rebates.

"You want to do as much of that as you can," Hahnel said. "Starting on Jan. 20 there are a whole host of things he can do right. Whether Obama's economic advisors will encourage him, is another matter."

"He hasn't started out talking to the right people," Hahnel said. "Robert Rubin is a neoconservative."

A treasury secretary under former President Bill Clinton, Rubin is now a CEO at CitiGroup. And "Larry Summers is his clone," Hahnel said. Summers also was Treasury secretary under Clinton.

Obama is likely to face strong criticism for advocating more spending and adding to the nation's mega-debt.

"The truth of the matter is, when you are headed into a bad recession the last thing you want to do is pull back spending on programmes. All that does is aggravate the recession. You lose tax revenue. You end up throwing people out of work," Hahnel said.

Obama should stick to his proposal to give tax rebates and tax cuts to workers, Hahnel said.

"They may say, 'How are you going to give those middle class tax cuts now, with the economy in a recession?' His answer should be, that is exactly what needs to happen," Hahnel said.

Excerpt:

By Adrianne Appel
BOSTON, Oct 31 2008 (IPS)

U.S. consumers are in no mood to spend, and that calls for action, Congress and the George W. Bush administration said this week.

Economic indicators released Thursday show that the economy, as measured by the Gross Domestic Product, slowed to a crawl during the summer, largely because people and businesses did not spend. The GDP grew at .3 percent July through September, far less than that of a robust economy and the worst in seven years.

This is to be expected, said Nouriel Roubini, economics professor at New York University, appearing before the congressional Joint Economic Committee.

“The condition of the U.S. consumer is very strained,” he said. People are worried about losing their jobs and are paying high mortgage rates.

“The lack of debt relief to distressed households is the reason why this financial crisis is becoming more severe and the economic recession worsening,” he said.

Roubini believes the U.S. has been in a recession since January 2008, and will remain in one for another 18-24 months.

“When it quacks and walks like a recession duck it is a recession,” Roubini said. “This is likely to be the most severe recession the United States has experienced in a number of decades.”

Jobless claims for this past week were 479,000, according to the Bureau of Labour Statistics, indicating higher than normal average unemployment nationwide.

The Federal Reserve cut its interest rate to 1 percent on Wednesday, the interest it charges to central banks to borrow.

Though business is slow for many companies, Exxon Mobil announced that its profits during the summer months rose 58 percent.

Ed Lazear, chair of the Bush administration’s Council of Economic Advisors, said the administration stands by its decision to spend 700 billion dollars on banks and financial institutions as a way to boost the economy.

“Our feeling is with 700 billion dollars, that is a significant sum of money. It will do the job but it will take some time. We don’t think we should be reacting to every minor problem that comes along,” Lazear said. “We’re confident we’re doing things to move us in the right direction.”

The Bush administration is reportedly considering using 50 billion of the U.S. Treasury’s 700-billion-dollar bailout fund to help slow home foreclosures. The government would guarantee certain mortgages if the lender agrees to lower interest rates. The government would pay the banks for any mortgages that do end up in default, according to press reports.

Sheila Bair, chair of the U.S. Federal Deposit Insurance Corporation, made the proposal to Bush. Her agency has provided no details.

“We have millions in danger of losing their homes, good people with jobs, who pay their taxes and look after their kids. They want to stay in their homes. There is a direct link between these people and the global crisis,” Bair said. “They can’t make their mortgage payments.”

“Everyone in Washington now agrees more needs to be done for homeowners. A new programme would provide incentives to lenders to modify loans,” she said.

White House press secretary Dana Perino declined Thursday to speak about the proposal. She told reporters that the 700 billion dollars, so far directed at the nation’s largest banks and financial institutions, is designed to help consumers and small businesses.

“We’re not in a position to announce anything imminent. We’re in the middle of analysing different proposals,” she said.

Both the Senate and the House, meanwhile, have held numerous hearings in the past couple of weeks focused on the need for new spending that would be directed to job creation and social programmes. The House passed such a plan Sep. 26 but it failed in the Senate, due to a lack of Republican support.

House Speaker Nancy Pelosi,a Democrat, is calling on Republicans to reconsider the plan in the Senate.

“The legislation creates and saves jobs by rebuilding our nation’s infrastructure for long-term economic growth, extends unemployment benefits, expands food assistance to ensure American families who are struggling have access to nutritious meals, and helps states struggling with budget shortfalls meet the health care and education needs of millions of Americans,” Pelosi said.

However, it will likely take more than Pelosi to convince Senate Republicans to pass a plan with billions in new spending. If passed, Bush must sign it, another uncertainty.

At the Joint Economic Committee hearing Thursday, Republican Rep. Kevin Brady was sceptical of the Democrats’ idea to spend billions.

“I question whether overspending our budget by 650 billion dollars is good for our economy,” Brady said. His Senate colleague, Sam Brownback, also has been staunchly opposed to new spending.

Richard Vedder, an economist and visiting Scholar at the neoconservative American Enterprise Institute, expanded on the concerns of some Republicans on the panel, and argued that tax cuts would do more to jumpstart the economy.

“I’m concerned that an overzealous Congress will make the situation worse,” he said. “Fiscal stimulus doesn’t promote economic recovery.”

Vedder said that using federal funds to begin roads and bridge construction is not an effective way to stimulate the economy in the short term. On average, it takes four years or more for such projects to get underway, he said.

Vedder said he didn’t agree that the economy was in a recession. But, “The economy must be in trouble for the Joint Economic Committee to have a hearing one week before the election,” he joked.

Roubini recommended the Congress authorise 400 billion in dollars spending on roads, alternative energy, food stamps and other programmes.

“It needs to be done right away. Three months from now the collapse in spending will be so sharp, it will be too severe to help,” Roubini said.

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