Author: Matthew G. Saroff

Sanity in Baltimore

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Baltimore County States Attorney Marilyn Mosby has announced that she is formally ending prosecutions of drug posession. There had been a temporary policy in place because of the pandemic, but this is a permanent change: 

Declaring the war on drugs over in Baltimore, State’s Attorney Marilyn Mosby announced Friday she will make permanent her COVID-19 policy to dismiss all criminal charges for the possession of drugs including heroin.

The city’s top prosecutor also said she will continue to dismiss criminal cases for nonviolent crimes of attempted drug distribution, prostitution, trespassing, open containers and minor traffic offenses. Since her office stopped taking these cases one year ago, prosecutors have dismissed 1,400 criminal cases and a similar number of warrants, she said.

Violent crime, meanwhile, has declined about 20% so far this year compared to the same three months of last year, largely before the coronavirus pandemic, according to police statistics. Similarly, property crime declined 35% when comparing those time periods.

“Clearly, the data suggests that there is no public safety value in prosecuting these low-level offenses,” Mosby said.

………

In March of last year, Mosby instituted her policy to dismiss all criminal cases of drug possession, saying she wanted to reduce the prison population and risk of a coronavirus outbreak behind bars. The policy fell in line with other progressive strategies she has brought to Baltimore, including a plan started in 2019 to dismiss all marijuana charges.

………
Mosby noted 911 calls for drug use, prostitution and public intoxication did not increase over the past year. In fact, she said the number of 911 calls for drugs declined by one-third compared to the same months before the pandemic. The 911 calls for sex work fell by half, she said.

……… 

“The concept is to provide a behavioral health rather than a criminal justice response” said Edgar Wiggins, the group’s executive director. “We have known for some time that this can be an effective way to address the underlying causes of this behavior.”

 Nice to see some sanity in law enforcement.

Support Your Local Police

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Disgraceful

It appears that the Santa Clara Police Officers Association is attempting to shake down local businesses.

Is it time to replace ACAB (All Cops Are Bastards) with ACAM  (All Cops Are Mobsters)?

In a move that seems straight out of a mafia playbook, the union representing Santa Clara’s police officers solicited donations from businesses in exchange for police department support.

In its “2021 Business Supporter” flyer, sent to local retailers, the Santa Clara Police Officers’ Association said, “Place our decal in your window, and we will direct our ‘FRIENDLY’S’’ to support you!”

The message appears to imply special treatment for those businesses displaying the decal after donating money to the union. The idea of the police department playing favorites based on donations contradicts claims that it values fairness and “will perform this service professionally and with integrity.“

Santa Clara Councilmember Anthony Becker expressed alarm over the flyer.

“I want answers to what they mean by ‘friendly’s,’” Becker said. “If they aren’t paying in, are you not going to protect them? Why would you put that on your flyer if you’re not going to really mean something out of it?”

The debacle led to Santa Clara City Hall releasing a statement saying donations made to the police union “are not related to the level of police service received.”

………

Another question raised by the flyer is what the requested donations will be used for. Union president Alex Torke publicly said donations made during annual campaigns are “deposited in a distinct account that is used strictly for donations to charities and charitable causes.” However, some speculate the money might be leveraged to influence elections or political causes.

“You can see…how they have used the money in the past,” said a Santa Clara City Hall insider who asked for anonymity. “A lot of their money has been used towards the PACs for political purposes.”

[Councilman Anthony] Becker said he would like to see a full accounting by the union of its budget.

“They don’t divulge they fund political candidates during elections,” Becker said. “I think they need to be a little more transparent about where that money’s going…and who they’re supporting with it. I’d really like to see that money going towards things we need, not political agendas.”

Becker claims some businesses told him they were directed by the police to not display his political signs during the last election cycle. 

When the cops are racketeers.

It’s rather more common than one would like to think.

And Back Up Again

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U.S. initial unemployment claims rose by 61,000 to 719,000 last week, which means ……… Hell, I don’t know.

The 4 week average fell though.

The weekly average for the before times was a little bit over 200K:

Filings for unemployment benefits rose last week but remained near their lowest levels since the pandemic’s onset, amid signs of a broader U.S. economic recovery.

Workers filed 719,000 initial jobless claims, on a seasonally adjusted basis, in the week ended March 27, the Labor Department said Thursday. The increase followed a downward revision to 658,000 initial claims the prior week, the lowest point since the pandemic hit in March 2020.

The four-week moving average, which smooths out volatility in the numbers, fell to 719,000, also a low during the pandemic.

I’m not sure what it all means in terms of trends, but until the weekly number drops below 300K, I would not take my foot off of the gas pedal.

Remember When I Said that Contextual Ads Were More Effective?

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I pointed to the case of a Dutch broadcaster who got better results, and more revenue, when they stopped using ad tech that tracked and identified (stalked) people, and switched to ads based on the contents of the web page that they were viewing. 

Well, with Google shifting its own ad tech, some other companies are discovering that what they were sold by Google and Facebook was complete pants: 

Bacardi last October ran a test to tell whether its campaign promoting Bombay Sapphire in the U.K. could boost sales and brand favor—and in the process help answer a broader question about the long-term fate of its digital marketing as the way consumers are targeted for ads faces a shift.

The campaign took 10,000 anonymized identities of people who had visited the gin brand’s distillery or website, and sent them offers like promotional emails or Instagram ads promising drink recipes and early access to new products.

The result was a click-through rate, which indicates how often ad exposures lead to clicks, around 9% higher than previous campaigns that relied on common but now endangered targeting methods, such as using data from third-party sources. The new campaign also saw a 14% increase in cost efficiency as measured by a cost-per-click metric.

Bacardi says those and other encouraging signs give it confidence in its ability to build its brand and sell products even once it no longer has access to individual ad tracking and targeting technology that Google plans to move against next year.

My guess is that Bacardi’s marking department is calling Google and Facebook and the other “Stalker Advertisers”  pig felching* c%$# sucking con men who should be put up against the wall, because they realized that they have been scammed.

You want to sell booze?  Buy ads on booze web sites.

It’s that simple, and it’s cheaper, and far less opaque.

*If you do not know that that word means, Don’t Google It. Trust me.

The Glory that is the Democratic Party establishment (There is no Democratic Party establishment)

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Civis Analytics, one of the constellation of grifters sucking the life out of consultants for the Democratic Party, founded by Obama Alumni, purged their workforce of people because they were labor organizing.

Trouble found Sunny Rao early the morning of October 30. By the time the Washington State–based data scientist woke up, the group text she shared with several co-workers at the Democratic data firm Civis Analytics had already begun to buzz. “Someone said that they had been fired,” she recalls. Worried, Rao tried to log in to her work computer, only to find it locked. Then she checked her email, and there it was, the news she’d feared: She was terminated effective immediately. No one “even met with me to tell me that I was getting fired or why,” she tells Intelligencer.

………

Rao and Klem say the company gave them no explanation for their dismissals. The timing was odd, too: Civis was working on Joe Biden’s presidential campaign, and the election was only days away. On the Google Hangout meetings, managers did not give a reason for laying off so many staff members at once, according to the fired employees. With nothing else to do, the group text began to put the pieces together. By the end of the day, they’d learned that Civis had fired 11 people. All were vocal activists at work, known among co-workers for their willingness to question company practices in meetings. Instead of experiencing confusion, Klem and Rao began to feel betrayal.

………

Twelve current and former Civis employees say the company’s internal practices fell short of its public promise to be a progressive place to work. “We were working to make Civis live up to the values posted on their website,” says an employee who was fired on October 30. In December, seven of those terminated filed a charge with the National Labor Relations Board, alleging Civis had illegally fired them for organizing. Last month, the NLRB dismissed the charge. An official for the regional board said its decision owed to a Trump-era precedent, according the attorney who represented the Civis employees, that had raised the standard for workers to prove unlawful retaliation. The seven workers say they plan to appeal this week, placing their hopes in the same Biden administration they helped to elect.

………

Wagner said he was “shocked” by the NLRB charge. “Civis has worked with labor unions since we were founded, and we strongly support the rights of workers to organize. We had no knowledge of any potential union organizing efforts and no evidence of it – no emails, no request for meetings, nothing.”

Still, if Wagner is telling the truth, and Civis had no idea that anyone wanted a union, the firings could still violate the National Labor Relations Act. Workers have the right to organize, whether it’s for a union or for leading protests at work. Retaliation is unlawful, and the NLRB can order employers to reinstate workers and offer them back pay — as the company’s new attorneys could tell them. Civis retained Jackson Lewis, a law firm an AFL-CIO official once called “the devil incarnate,” to handle its case at the NLRB.

Because, of course they did.

Ethics, schmethics, there is grifting to be done.

The allegations against Civis sting more given its origins. Wagner, who was the chief analytics officer for Barack Obama’s reelection campaign, built the company to put liberals in power. The pitch was simple. Democratic campaigns needed a network of reliable number-crunchers, and rather than build new analytics teams every four years, candidates could now turn to a single company. During the 2020 election cycle, the firm earned $8.5 million for work on the campaigns of Biden, Pete Buttigieg, Cory Booker, and Elizabeth Warren and on other Democratic ventures. While political campaigns still generate much of the company’s revenue, it also works in public health and for various government agencies and, yes, labor unions, like the American Federation of Teachers, to the tune of almost $1 million since 2014.

………

On its website, Civis makes a lot of promises to prospective workers with principles. “No a**holes,” reads its mission statement. But the former workers all say a banal reality lurked behind the buzzwords: Civis was not all that different from any other corporate employer. In a 2019 incident that still rankles former employees, Wagner announced a companywide pivot — and that meant layoffs — that he called a “CTRL-alt-delete moment” for Civis in a staff meeting. The flippancy infuriated workers, who cite it in conversations with Intelligencer as a sign that portended battles to come.

Kind of like how the Obama White House was a “Genuinely hostile workplace to women.” 

Talking the talk, but not walking the walk.

In March 2020, as the pandemic began and the Democratic primary hit its most frantic tempo, contract employees struggled with heavy workloads and waited for permanent jobs that had been promised but never appeared. Right after the pandemic hit and staff moved to remote work, the company introduced a controversial new policy. Members of its government team now had to hit a quota of billable hours, starting at an average of 37 and a half a week. Civis told staff the new policy would be more equitable than the status quo, which saw some employees billing at much higher rates than others. Quotas aren’t all that unusual for consulting companies, but Civis paired its quota with unlimited paid time off, which was. Workers also had non-billable job responsibilities to perform on top of the quota, and former employees say that when staff took sick leave, even in the middle of a pandemic, they had to make up the hours later. The company had several initiatives designed to improve Civis from within — like a diversity-and-inclusion working group — but, staffers grumbled, where was the time to participate?

37½ billable hours a week is the equivalent of at somewhere between 55 and 75 actual hours a week.

………

“I was the highest-level woman of color on the government team,” she says. In regular one-on-one meetings with a Civis executive, she says she repeatedly asked for anti-racism training for employees at work. The organization hosted implicit-bias trainings and donated money to five charities, but she felt that didn’t go far enough. Particularly galling for Rao was a summertime presentation by her managers, which singled her out as proof that Civis prized diversity. “When we hired Sunny, we met the Rooney Rule but only interviewed two people,” said one of the slides reviewed by Intelligencer.

………

Workers say they coordinated with each other via a private Slack channel and phone calls on how to press Civis for changes. They wanted better paid-leave policies, clearer career progression for contract workers, professional development, and an end to what they called “the progressive pay cut” — a below-market wage offered to young workers in search of jobs that don’t offend their principles. When they raised these issues in staff meetings or one-on-one conversations, three former employees say, managers thanked them for speaking up.

This is explicitly protected activity under the NRLA, and Civis CEO Dan Wagner knows this, because if he’s hired the biggest union busting law firm in the nation, Jackson Lewis, they have told him that it is explicitly protected activity, and how to evade the requirements of the law.

Around the same time, in late May, a senior Civis analyst named David Shor tweeted himself into trouble. Amid mass protests over the police killings of George Floyd and Breonna Taylor, Shor shared a link to research that showed a decrease in Democratic votes after similar unrest in 1968. Critics accused him of racial insensitivity. Six days later, Civis fired him, putting the company under a harsh spotlight. Former and current employees say Shor’s firing exacerbated unease with the way Civis managed employees. While commentators dissected the Shor case and its implications for free speech, Civis employees viewed it more as a labor issue, a sign that management was capricious and everyone was vulnerable.

By the fall, the resentment inside Civis came to a boil. Early in October, four former employees recall, a co-worker learned mid-meeting that her grandmother had died. Devastated, she left the call, then asked for bereavement leave in a one-on-one meeting with her manager. It didn’t go well, she later told co-workers who spoke to Intelligencer. The woman’s manager told her that she could take leave — but only if she made up the hours when she returned, her former co-workers recall her saying. Watching the billable-hours policy directly affect a co-worker and friend “made me personally angry and motivated to organize to affect change,” one co-worker tells Intelligencer. Within days of the incident, two employees reached out to a contact at the AFL-CIO for advice on the process of organizing a union.

Separately, Civis employees asked for greater transparency regarding the way the company chose its clients. As the presidential election approached, a Civis contract with Facebook worried a number of staff, including workers who weren’t involved in any conversations about unionization. The employees felt Facebook spread too much hate and had done too little to drive the violent far right off its platform. At an October 20 meeting open to the entire company, employees wanted to know how exactly Civis chose its clients, including Facebook: What good was the Civis litmus test if staff had no say in how it worked?

………

Ten days after that Facebook meeting, Sunny Rao, Sarah Klem, and nine other people were fired. Asked whether they believed their Facebook criticisms contributed to their firings, the workers would not comment. It’s certain, though, that they’d already been vocal company critics for months. Former and current employees tell Intelligencer that the 11 people who lost their jobs were all known internally for their activism at work, though only seven filed a charge with the NLRB.

………

Though the NLRB’s Chicago office, where Civis workers filed the original charge, didn’t deliver the finding the workers had hoped for, it may not have vindicated Civis either. The employees’ former attorney says the NLRB made it clear that Trump-era precedent had tied its hands: A divided 2019 ruling from the national board raised the bar for workplace activists to prove they’d been fired as retaliation. The case, Electrolux Home Products, Inc. and J’vada Mason, made it easier for employers to invent a pretext and still slide through the board’s review process, says Brandon Magner, a labor lawyer and the author of the Labor Law Lite newsletter.

Now that the seven who filed the NLRB charge have said they will go to the NLRB’s Office of Appeals, the Civis case could end up being more influential than they anticipated. Control of the national board is about to switch parties, as current appointees see their terms expire. “If everything goes the way it should, the ‘Biden board’ will be in place,” Magner explains. If the timing’s right, there’s “a chance” Civis could become a test case for overturning Electrolux, he adds.

If the NLRB overturns Electrolux on these assholes backs, I will be amused.

 

Tweet of the Day

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The only thing I would add to this is how defensive officials I talk to get when I say plainly that America lost the Afghanistan war. It’s instinctive, tribal and revealing, a glitch in the matrix of American Exceptionalism. https://t.co/vmHcgeab2M

— Spencer Ackerman (@attackerman) April 2, 2021

Mixed emotions on this one, but just on the semantics.  I don’t think that we LOST the war in Afghanistan, I think that the Afghans BEAT us.

The phrasing of “Lost” implies that the agency was all on the part of the us, but the American public lacked the will to continue.  (It’s called the Green Lantern theory of geopolitics.)

This terminology allowed our military to learn nothing but how to lie to the American public in response to the Vietnam debacle.

In Afghanistan, much like in Vietnam, we were beaten, and once again, we will learn nothing from this.

Happy Pie Day

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This is the best Pie Day bit ever:

What? You saying that it’s April Fools day, not π Day, March 14th?

I wrote Pie Day, not π Day.  Get with the program.

Google is not playing this year, because ……… Covid.

Some other people are still doing pranks though:

Once Again Stating the Obvious

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Is anyone surprised to find that philanthropy by the very rich is largely self-serving?

I am not surprised one bit.  This has been the way of the hyper rich since before Crassus had his last drink of molten gold.*

Relying on private philanthropy serves only to increase their power, because the goal of the hyper-rich is not to help, but to reinforce their own position of power:

Philanthropy among the elite class in the United States and the United Kingdom does more to create goodwill for the super-wealthy than to alleviate social ills for the poor, according to a new meta-analysis. 

A group of U.K. researchers reviewed 263 journal articles, books and studies on elite philanthropy to better understand the role it plays in this new age of inequality. In the United States, the wealth gap between richest and poorer families has more than doubled since the 1980s, and in the United Kingdom, the incomes of the richest fifth are 12 times as much as the incomes of the poorest fifth. 

The researchers’ paper, published in a special issue of the International Journal of Management Reviews, lays out how on the whole, the elite class mainly donates to causes that provide themselves with some type of benefit. The researchers defined “elite philanthropy” as “the preserve of wealthy individuals and close family members” who became rich through entrepreneurship, either by starting a new business or expanding an inherited one. These individuals generally have extensive local, national and international business networks, the researchers said, and occupy positions with the “field of power,” a social space at the top of society that allows them to impact policy and practice.

………

Many people mistakenly view elite philanthropy as a benign force for good rather than an avenue for the super-wealthy to translate economic capital into social and cultural capital, according to the researchers. Elite philanthropy, the study argues, is transactional, as there are also material benefits in addition to the cultural capital. In 2017, the United States increased the proportion of income that can be deducted from 50% to 60%, which directly benefits the elite; and in the United Kingdom, efforts to reduce philanthropic tax relief fell through in 2012 after pushback from wealthy philanthropists.

In study after study, the rich are shown to be relatively less generous, and more inclined to engage in antisocial and immoral behavior.  Why should their so-called “charity” be any different?

*Yes, I know, Marcus Licinius Crassus actually died in battle, and not as a result of having molten gold poured down his throat. It’s a metaphor.

Not Enough Bullets

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Did you know that if the minimum rose as fast as Wall Street bonuses, it would be $44 an hour now?

I don’t know about you, but it makes me want to find a way claw to it all back, because, to quote Billie Ray Valentine, “Billy Ray Valentine principle, “The best way you hurt rich people is by turning them into poor people.” 

The chaos that the coronavirus pandemic unleashed on America’s economy turned out to be a major boon for Wall Street traders, according to new data from the New York state comptroller’s office.

Wall Street firms paid their New York City-based traders an average bonus of $184,000 last year, a 10% increase from 2019, New York’s comptroller, Thomas DiNapoli, said in a press release Friday.

But those paydays have been skyrocketing for decades. Since 1985, Wall Street traders’ bonuses have grown 1,217% — and that’s just part of their overall pay, which was more than $406,000 on average in 2019, according to data from DiNapoli’s office.

By comparison, the federal minimum wage has flatlined at $7.25 an hour — or $15,080 annually — for 12 consecutive years. When adjusted for inflation, it has actually decreased by 11% since 1985.

If the minimum wage had instead grown at the same rate as Wall Street bonuses, it would be $44.12 an hour today.

We really need to levy a tax on financial transactions, and place a limit on fees for tax advantaged accounts (IRAs, 401(K)s, etc) of less than 10 basis points.  (.1%)

These parasites have been doing nothing but extracting wealth from the rest of us for decades.

Going Down the Wikipedia Rabbit Hole

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I am sure that most of you have experienced this, you look up something, and you go to the Wikipedia page, and there is an interesting link, and you go there, and before you know it, you have clicked on 20+ different links, and you are looking at something completely unrelated to where you started.

Well, I did this today, I was looking up the comedy team of John Clarke and Bryan Dawe, after posting their classic sketch, The Front Fell Off, and I ended up on the sport of ferret-legging.

Ferret legging is a sport in which men (and it is almost always men) stuff ferrets down their trousers, and the one who can do this for the longest time wins:

Ferret-legging was an endurance test or stunt in which ferrets were trapped in trousers worn by a participant. Also known as put ’em down and ferret-down-trousers, it seems to have been popular among coal miners in Yorkshire, England. Contestants put live ferrets inside their trousers; the winner is the one who is the last to release the animals.

Ferret-legging may have originated during the time when only the relatively wealthy in England were allowed to keep animals used for hunting, forcing poachers to hide their illicit ferrets in their trousers. Following a brief resurgence in popularity during the 1970s, it has been described as a “dying sport”, although a national ferret-legging event was held in Richmond, Virginia from 2003 to 2009.

Description and rules

In the sport of ferret-legging, competitors tie their trousers at the ankles before placing two ferrets inside and securely fastening their belts to prevent the ferrets from escaping. Each competitor then stands in front of the judges for as long as he can. Competitors cannot be drunk or drugged, nor can the ferrets be sedated. In addition, competitors are not allowed to wear underwear beneath their trousers, which must allow the ferrets free access from one leg to the other, and the ferrets must have a full set of teeth that must not have been filed or otherwise blunted. The winner is the person who lasts the longest.

The sport is said to involve very little “native skill”, simply an ability to “have your tool bitten and not care”. The former world champion, Reg Mellor, is credited with instituting the practice of wearing white trousers in ferret-legging matches, to better display the blood from the wounds caused by the animals. Competitors can attempt, from outside their trousers, to dislodge the ferrets, but as the animals can maintain a strong hold for long periods, their removal can be difficult. The ferrets are occasionally put inside the contestants’ shirts in addition to their trousers. An attempt to introduce a female version of the sport—ferret busting, in which female contestants introduced ferrets down their blouses—proved unsuccessful.

This is profoundly weird, and having been exposed to the story Sredni Vashtar by Saki at a young age, it is certainly not a sport that I have any interest in participating in, though right now I am craving a piece of buttered toast. (It’s Passover, so I am REALLY craving a piece of buttered toast)

Quote of the Day

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This is an important distinction, because it means we’re not up against some intrinsic aspect of our being here. We’re up against a small minority of manipulative sociopaths and psychopaths and a system which rewards a lack of empathy.

—Caitlin’s Johnstone explaining how she sees the current state of affairs as a function of a relatively small minority of assholes, and not the while human race.

This is actually one of the more optimistic statements that Ms. Johnstone has made, and I hope that she’s right.

Certainly, human survival has for most of our existence depended on empathy and cooperation, hunter gatherer societies, upwards of 95% of our history could not function without this.

The current state of affairs, we can call it Neoliberalism, certainly does seem to cater to the absolute worst in us and of us.

This Can’t Be Good

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With all the signs pointing to explosive economic growth in 2020, economists are generally predicting a growth rate greater than 5%, the news that personal income fell by $1,516.6 billion (7.1%) from January to February is a pretty dire data point. 

Obviously, there were some freak conditions in February, the massive Texas blackouts come to mind, but this is pretty grim news:

Hence, when the opening line of the press release for this report tell us “Personal income decreased $1,516.6 billion (7.1 percent) in February“, that means that the annualized figure for US personal income in February, $19,945.6 billion, was $1,516.6 billion, or roughly 7.1% less than the annualized personal income figure of $21,462.2 billion for January; the actual change in personal income from January to February is not provided…similarly, annualized disposable personal income, which is income after taxes, fell by nearly 8.0%, from an annual rate of an annual rate of $19,210.5 billion in January to an annual rate of $17,678.2 billion in February…the components of the monthly decrease in personal income, which can be seen in the Full Release & Tables (PDF) for this release, are also annualized figures…in February, the reason for the $1,516.6 billion annualized decrease in personal income was a $1,584.1 billion annualized decrease in government social benefits to individuals, which was only slightly offset by a $37.7 billion annualized increase in business & farm proprietors’ income and a $15.6 billion annualized increase in interest and dividend income…wages and salaries, which fell by an annualized $0.2 billion, were barely a factor in February’s personal income change . . .

Not great economic news.

Diplomatic Nostalgia

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To be honest, I have not heard the term, “Running Dog,” as used by elements of the Chinese foreign policy apparatus ever. I’ve merely heard about this, because its use pretty much ended when Nixon went to China, and I wasn’t even 10 years old then.

So I find it rather amusing that a Chinese diplomat has just used the sobriquet to describe Justin Trudeau.

I thought that the term had died when Mao Zedong did:

A Chinese diplomat has dismissed Canada’s prime minister Justin Trudeau as a “boy” in a social media attack marking a new low in the fractured relationship between the two countries.

China and Canada have clashed repeatedly in recent months, and last week the two countries imposed sanctions on each other in a growing row over Beijing’s treatment of its Uighur minority.

But on Sunday, Trudeau was singled out for insult by China’s consul general to Rio de Janeiro, Li Yang in a tweet blaming him for the diplomatic crisis.

“Boy, your greatest achievement is to have ruined the friendly relations between China and Canada, and have turned Canada into a running dog of the U.S,” he tweeted.

The demeaning term “running dog” , a relic of Maoist China, is often used to describe nations that are subservient to countries like the United States.

Honestly, I am stunned at the PR ineptitude of the elements of the Chinese state on this one.

Maybe they should hire some professionals who could do a better job, because even the Marketing Department of the Sirius Cybernetics Corporation would be an improvement.

Quote of the Day

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Look, is the seller a vampire?

No, not that I’m aware of.

If he was, would you be allowed to say, or is there some kind of realtor privilege?

Well, in real estate we talk about the property, not the people, because of housing discrimination.

Oh, that’s a good point. I don’t know if vampires are a protected class.

I’ve learned in fair housing seminar after fair housing seminar, you do not talk about people. You want me to tell you how many square feet or how long the driveway or what it looks like inside, no problem.

—Slate, interviewing a realtor trying to sell a vampire-goth themed house in Baltimore.

The listing is linked to in the article, and it’s a trip.

The Front Fell Off

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The Front Fell Off?

It now appears that the Ever Given, the massive container ship which had completely blocked the Suez Canal, has been freed and traffic has resumed through the waterway.

There is still a major backlog of ships in both directions, but after a week, we should expect a return to normal shipping conditions.

The bigger issue is how this event has demonstrated the fragility of international shipping.

What’s more, it has increasingly been juxtaposed with economic fragility driven by the increasingly oligopolistic nature of shipping, which means that if one shipper fails, the entire system can seize up.

The classic Clarke and Dawe sketch, “The Front Fell Off,” (shown) is a perfect metaphor for this:

In this newsletter, I do a lot of explaining about complicated problems caused by big dumb corporate institutions. I don’t have to do that this time, because the story of the mess in the Suez is so simple. “After years of bitcoin and reddit short selling and credit default swaps and a million other things I don’t understand,” one random person put in a tweet that went viral, “it’s so refreshing to hear that global commerce is in peril because a big boat got stuck in a canal.”

That’s basically the story right there, it’s a big boat and it got stuck in a canal. The ship blocking the Suez, called the Ever Given, weights 220,000 tons, and is as long as the Empire State Building is high. Despite the hilarious nature of the problem, the disruption to world trade is large and serious, costing tens of billions of dollars. And if the ship can’t be dislodged soon, some consumers will once again experience shortages of basic staples like toilet paper.

That said, the reason this disruption to global commerce seems so dumb is because it is. It starts with the ship size itself. Over the last few decades, ships have gotten really really big, four times the size of what they were 25 years ago, what the FT calls “too big to sail.’ The argument behind making such massive boats was efficiency, since you can carry more at a lower cost. The downside of such mega-ships should have been obvious. Ships like this, which are in effect floating islands, are really hard to steer in tight spaces like ports and canals, and if they get stuck, they are difficult to unstick. In other words, the super smart wizard financiers who run global trade made ships that don’t fit in the canals they need to fit into.

The rise of mega-ships is paralleled by the consolidation of the shipping industry itself. In 2000, the ten biggest shipping companies had a 12% market share, by 2019 that share had increased to 82%. This understates the consolidation, because there are alliances among these shippers. The stuck ship is being run by the Taiwanese shipping conglomerate Evergreen, which bought Italian shipping firm Italia Marittima in 1998 and London-based Hatsu in 2002, and is itself part of the OCEAN alliance, which has more than a third of global shipping.

Making ships massive, and combining such massive ships into massive shipping monopolies, is a bad way to run global commerce. We’ve already seen significant problems from big shipping lines helping to transmit financial shocks into trade shocks, such as when Korean shipper Hanjin went under and stranded $14 billion of cargo on the ocean while in bankruptcy. It’s also much harder for small producers and retailers to get shipping space, because large shippers want to deal with large clients. And fewer ports can handle these mega-ships, so such ships induce geographical inequality. Increasingly, we’re not moving ships between cities, we’re moving cities to where the small number of giant shipping lines find it efficient to ship.

Dumb big ships owned by monopolies are the result of dumb big ideas, the physical manifestation of what Thomas Friedman was pushing in the 1990s and 2000s with books such as The Lexus and the Olive Tree and The World is Flat, the idea that “taking fat out of the system at every joint” was leading towards a more prosperous, peaceful and competitive world. Friedman’s was a finance-friendly perspective, a belief that making us all interdependent with a very thin margin of error would force global cooperation.

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What is new isn’t the vulnerability of the Suez Canal as a chokepoint, it’s that we’ve intentionally created lots of other artificial chokepoints. And since our production systems have little fat, these systems are tightly coupled, meaning a shortage in one area cascades throughout the global economy, costing us time, money, and lives.

It’s a dumb way to organize a global supply chain system, just as it was dumb to build ships that are too big to fit into canals. And that’s why the “big boat stuck in canal” is such a great illustration of the problem, it shows our policymakers and corporate leaders couldn’t even think through what would happen if Really Big Thing Got Stuck In Important Canal.

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The answer to addressing the problem of thinned out supply chains is to recognize that hyper-efficient globalization inherently carries the downside of unpredictable shortages, geopolitical tension, and supply disruptions. And then redesign our global trading order to make it less efficient and more resilient. There are three basic changes we’ll need.

Matt Stoller calls for a rigorous enforcement of anti-monopoly measures, a reimpositition of border friction like tariffs, and a restructuring of business so that they are less indebted and less vulnerable.

Unfortunately, this will not happen, because this system was created to benefit financial institutions and to drive wages down through labor arbitrage, so his reforms are actually a repudiation of the entire system.

I support his ideas, but I don’t think that they are politically realistic at this time.

 

Linkage

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A specific example of how Amazon uses its monopoly position as a marketplace to crush competitors:

Banking and Booze

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Louis Dejoy is trying to destroy the US Post Office, as are a majority of the board members.

They are doing so because they want the union destroyed, and because in privatization is an opportunity for looting.

The first step to fixing the USPS is to repeal the absurd requirements that it has to fund employee benefits 75 years into the future, a couple of good follow-up steps are to re-establish postal banking, and allowing the Post Office to deliver alcohol. 

There are way too many unbanked in the US, and the delivery of things like stimulus checks would be facilitated by a Post Office that has an account for every citizen, and delivering booze is lucrative:

When U.S. Postmaster General Louis DeJoy laid out plans Tuesday for the future of the post office, he pointed to higher postage rates and slower first class mail as a means of stemming postal service losses he says could reach $160 billion.

But missing from his new 10-year plan were two ideas economists, members of Congress and consumer advocates say could generate billions of dollars for the beleaguered service and bring the post office into the 21st century: a return to postal banking and the post office’s entry into the lucrative alcohol delivery business.

“We don’t expect the post office of the 21st century will be the same as the post office of the 20th century,” said Rakim Brooks, senior campaign strategist for the American Civil Liberties Union. “People are using the mail less, and we think that the institution has to provide new services.”

Postal banking, he said, is among the new services the post office of the 21st century could — and should — provide. It would include basic banking services, including check cashing, providing low- or no-fee checking accounts, installing low-fee ATM machines, and providing wire transfer and bill payment services.

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Long said it makes sense for post offices to double as banks, especially given the growing number of “bank deserts” in the U.S., communities in which there are no commercial banks.

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Congress is taking notice of postal banking. Last year, Sen. Kirsten Gillibrand, D-N.Y., and Sen. Bernie Sanders, I-Vt., introduced the Postal Banking Act, aimed at providing consumers with bank accounts and mobile banking services.

In a statement, Gillibrand noted, “Postal banking is an elegant solution that would provide the USPS upwards of $9 billion a year in revenue and would address the high cost of being poor in America by eliminating payday loans, check cashing, and other predatory financial products.

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Just as [Porter, not Mitch] McConnell believes postal banking could provide additional revenue for the Postal Service, she notes that shipping alcohol could also generate money for it.

FedEx and UPS are currently allowed to ship wine, beer and spirits, but because of Prohibition-era legislation, the Postal Service is not.

According to the Congressional Budget Office, the Postal Service could make an additional $50 million a year if it were to be able to ship alcohol.

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In 2019, Rep. Jackie Speier, D-Calif., introduced the bipartisan USPS Shipping Equity Act, a bill which would enable the Postal Service to ship alcohol.

There is not a lot of support for this, because it is likely to be successful, which would run afoul of the anti-government crowd, as well the banks and private parcel carriers, who would then have less money for campaign donations.

We Live in Bizarro World

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Did not Expect This

I never thought that I would agree with Elmer Gantry wannabee Franklin Graham, but his support for vaccines is unequivocally correct.

Needless to say, his wacko, my parents are first cousins, X-Files wannabe, black helicopter, tinfoil hat wearing, stupid, dim-witted, thinks pro wrestling is real* fellow travelers, were not so sanguine about his statement. (By that I mean that they went nuts)

So, Franklin Graham was right about a matter of both public health and the overall public good.

I cannot believe that I just said that.

*Sorry, I think that I just channeled the comedian Denis Leary.

Nope, Nothing Dodgy Here

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Have you heard about SPACs? (AKA, “Blank check companies.”

The short version is that they are shell companies created to raise capital to take other companies public.

The SPAC issues shares, raises money, and then buys a company, taking the target public.

If this sounds dodgy, as in, “Why don’t those companies go public on their own?” you are right.

The answer is, as far as I can tell, evading regulations and increasing the opacity of the investment, since there is no SEC due diligence and the like.

Their rates of returns to investors suck, as they are typically a number less than 0, a loss, though the managers make bank, and I suppose money launderers are OK with taking the hit.

As such, it is not surprising that the SEC has opened an investigation into the recent explosion of these arcane financial instruments:

The U.S. securities regulator has opened an inquiry into Wall Street’s blank check acquisition frenzy and is seeking information on how underwriters are managing the risks involved, said four people with direct knowledge of the matter.

The U.S. Securities and Exchange Commission (SEC) in recent days sent letters to Wall Street banks seeking information on their special purpose acquisition company, or SPAC, dealings, the four people said.

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The SEC, which declined to comment for this story, has previously said it was monitoring the SPAC boom, but the letters are the strongest sign yet that it is stepping up scrutiny of such deals and the Wall Street banks that underwrite them.

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Wall Street’s biggest gold rush of recent years, SPACs have surged globally to a record $170 billion this year, outstripping last year’s total of $157 billion, Refinitiv data showed.

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Investors have sued eight companies that combined with SPACs in the first quarter of 2021, according to data compiled by Stanford University. Some of the lawsuits allege the SPACs and their sponsors, who reap huge pay-days once a SPAC combines with its target, hid weaknesses ahead of the transactions.

Hiding weakness ahead of the transactions is the PURPOSE of SPACS.

BTW, if you are wondering just how dodgy this whole mess is, look no further than WeWork, whose IPO infamously collapsed on insider looting and misleading accounting.  They now intend to go public via merging with a SPAC: 

Even though WeWork has long lost billions of dollars, it always found ways to attract huge investments from deep-pocketed investors. Now, less than two years after it was rescued from a collapse, the co-working company has found yet another backer willing to overlook its losses.

The company announced on Friday that it had agreed to merge with a blank-check firm in a deal that would give it a listing on the stock market it was denied when it was forced to shelve an initial public offering as investors questioned its financial strength and dubious governance practices.

Instead of a traditional I.P.O., WeWork is merging with BowX Acquisition, a company listed on the stock exchange for the sole purpose of buying a business, in a type of deal that has become hugely popular in recent months. Investors, bankers, and even celebrities and athletes have rushed to float such special purpose acquisition companies, or SPACs, because they offer their creators a chance to mint huge profits relatively quickly. And merging with these vehicles is attractive to companies like WeWork because they provide an express lane onto the stock market without the obstacles that scuttled WeWork’s public offering in September 2019.

“Obstacles,” what a quaint way to describe flagrant fraud and misrepresentation.

This is yet another way for Wall Street to steal from you,