2005 - %3, December

Military Resists Weapons Cuts

| Tue Dec. 6, 2005 12:04 PM GMT

More fascinating news on the military budget front. The Wall Street Journal reports today (page A1) that the Air Force is going to cut 30,000 to 40,000 personnel over the next decade in order to save some of its big-ticket weapons programs:

To stay within its expected budget, the Air Force is planning to cut at least 30,000, and perhaps as many as 40,000, uniformed personnel, civilians and contractor-support staff through fiscal 2011, military officials said. The exact composition of the cuts isn't known, though their thrust is clear: "This is one way to pay the bills without messing around with our weapons programs," said one official involved in the Air Force budget.
It looks like the Air Force will use that money to keep both the Joint Strike Fighter program—a costly purchase that was once called "unexecutable" by the GAO—along with a system of "missile-warning satellites" built by Lockheed that has been years late and costing "more than three times as much as its initial $3 billion budget." Both programs were under fire from the Pentagon but it seems the Air Force managed to deflect the axe by going after personnel instead. And yes, in case anyone was wondering, "the shift is good news for the nation's major defense contractors." As I recall, about a month ago, the Army proposed something similar in response to the Pentagon's demands for $11.7 billion in cuts from them: the service offered to reduce its force structure, at a time when the Army is already stretched thin, rather than touch its own procurement budget.

Now perhaps someone knows better than I, and surely there are a lot of ins and outs involved here, but it sure looks like defense contracts are dictating the type of military we have, rather than the other way around...

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The Truth About Rendition

| Tue Dec. 6, 2005 11:34 AM GMT

It would be a full-time job to catalogue all the lies that come out of the Bush administration. But here are two important ones. Hilzoy of Obsidian Wings calls the president on his statement today that "we do not render [detainees] to countries that torture." Not even the most Clintonian parsing of that statement could make that true.

Meanwhile, in the Christian Science Monitor, Tom Regan swats down Condoleeza Rice's claims about rendition, and compiles evidence that innocent detainees have been captured, rendered abroad, and tortured. Numbers are hard to come by, but here's one attempt:



Alito and Executive Power

| Tue Dec. 6, 2005 11:23 AM GMT

Dahlia Lithwick has an important piece today in Slate, trying to figure out how Samuel Alito would rule in various "war on terror" cases if he ever makes it to the Supreme Court. Alito doesn't have a lot of experience in this area, but when the opportunity has arisen, the man has always—always—ruled in favor of greater police and government power. Odds are he'll side with the president when Bush wants the power to detain people without charging them, or ask for a "blank check" during a state of war—something that previous Courts have refused to give him.

Back when it looked like Harriet Miers was going to be the nominee, I wrote a long-ish post noting that an expansion of executive power has always been a longtime Republican goal, and Alito looks like he's willing to further that. It's not just "war on terror" powers; the GOP has long wanted executive privileges in secrecy matters and the power to control the executive branch free from congressional oversight. While Alito's views on Roe v. Wade will certainly take up the bulk of the time in his upcoming Senate hearings—and in a just world, the Democrats would filibuster him for it—but his views on executive power should get a thorough scouring as well.

Fun with Defense Contracting

| Mon Dec. 5, 2005 1:32 PM GMT

David Cloud's report in the New York Times today about the Navy's plans for future shipbuilding is interesting for two reasons. First, there's the surface reason: the Navy appears to be scaling back its plans for a war with China, and adjusting its procurement budget so that the service can play "a greater role in counterterrorism and humanitarian operations." A while back, Defense Industry Daily did a profile of the Littoral Combat Ships that seem to be the centerpiece of this new look, so that gives some of the flavor here. But Cloud's report is also of interest because you can detect undertones of the Navy's growing budgetary conflict with Congress.

The Navy has been slowly losing the battle to preserve its funding over the past few years, partly because both the Bush administration and many members of Congress don't seem to believe that ships and submarines are wholly relevant to the so-called global war on terror, and partly because shipbuilding has become hideously expensive. The Navy's FY2006 budget requested only four new ships, scaled back from the six they were planning to request the year before, and well below the eight per year that naval officials would reportedly prefer. (Figure it this way: If ships have an average life span of 35 years, then the current fleet of around 281 ships will need to buy 8 new ships every year to maintain itself.)


The main concern seems to be that shipbuilding costs are ballooning far beyond what anyone envisioned. Not surprisingly, the Soviet-style command economy hasn't worked very well for the defense industry. The Navy had earlier proposed, as a way of keeping its costs down, that two shipyards compete for the right to build all DD(X) destroyers, rather than let the two facilities "share" production, without any incentive to compete. Naturally, twenty members of Congress opposed the idea, since competition would defeat the "share the wealth" mentality that supports inefficient contracts. At least this year, the House tried to put a stop to some of these inefficiencies by imposing cost ceilings on future ships, but ultimately these debates often come down to which members of Congress need contracting jobs for their constituents, and how powerful those members are. (After all, the supposedly "budget-conscious" House also marked up an additional $2.5 billion for two DDG-51 destroyers.)

Worth noting, though: it's always a leap of faith to try to guess whether Congress is really scaling back the procurement budget, as it appears to have done for FY2006. The Center for Strategic and Budgetary Assessments has pointed out that many procurement costs may have just been shoved into the future. A favorite trick is "incremental" funding, where Congress appropriates only part of the money needed to complete a ship, figuring that the rest will get added on in later years (after all, if the Navy only needs a couple million more to finish up a nuclear submarine, who's going to say no?).

Back to Cloud's original story, though it's also not exactly clear whether the Navy really needs to build 32 new ships, at a cost of an extra $13 billion a year, by 2020. I certainly don't know, but it's a question worth asking. A June 2005 CRS report on naval transformation lays out some of the issues being debated here. On the one hand, the Navy has been trying to change in a lot of ways you'd expect, so that it can do things like operate in coastal areas and improve its response time. This certainly came in handy with the Navy's rapid response to the tsunami in Indonesia last year, a move that probably did as much for national security as anything else the military's done since 2002. On the other hand, the Navy seems to be placing a fair bit of emphasis on "strategic defense against ballistic missiles," which usually leads to some dubious spending decisions.

Flight Risk

| Mon Dec. 5, 2005 10:39 AM GMT

New at Mother Jones:

Frank Koughan and Sheila Kaplan continue their investigation into allegations that Boeing is using unapproved and unsafe parts for its 737s and other aircraft. The latest in the series reports on how FAA investigators have failed to examine the jets in question. (link).

Michael Schwartz debates against the top ten most commonly-offered reasons to stay in Iraq (link).

Mark Engler interviews three editors of a new book on American war crimes in Iraq (link).

In the news today, the 9/11 Commission released its final report today, calling overall progress on the government's response to the 2001 terrorist attacks "disappointing." Last year, Gail Sheehy profiled Commission Chairman Thomas Kean for Mother Jones, explaining how he "refused to be Bush's patsy" (link); earlier Sheehy had wondered why the 9/11 Commission says nothing about the inaction of Bush and Rumsfeld on 9/11 (link). Also, last September Matthew Brzezinski investigated the problems with the Deparment of Homeland Security (link).

Meanwhile, here in California, the execution date for Stanley "Tookie" Williams, the founder of the Crips turned peacemaker, draws nearer, and Gov. Arnold Schwarzenegger is debating whether to grant clemency or not. Venise Wagner interviewed Williams for Mother Jones in March, 2001 (link).

September 11 recovery money diverted to large international corporations

| Mon Dec. 5, 2005 8:54 AM GMT

Last month, a bipartisan group of Congresspeople, in a rare display of doing what we elected them to do, turned the heat up on the Bush administration over the fact that so many Katrina recovery contracts had gone to large corporations in the usual Bush no-bid way. As a result, the contracts were re-bid.

Pity such a group wasn't around after September 11. The New York Daily News has put together a report on where the September 11 recovery money went, and--surprise, surprise--much of it, though pledged to small businesses, went instead to large international corporations.

Among the companies getting the hundreds of millions of dollars handed out by the federal government was a stock brokerage firm that had closed over a month before the attacks took place. The company, which applied for a grant, received $150,000, and its sister corporation received over $50,000. 4U Services, a technology consulting firm, received so many grants and loans that the total amount of relief was $640 million.

Empire State Development Corp., a company with no experience in providing disaster relief, created five grant programs and two loan programs, and the money flowed.

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Torture and Criticism

| Sat Dec. 3, 2005 6:22 PM GMT

Yesterday, the New York Times reported that the Chinese government still tortures its prisoners. Hardly surprising, one might say. But notice, many defenders of the Cheney administration's stance on interrogation tactic wouldn't call this "torture" at all:

The authorities ban only the sort of torture, called kuxing in Chinese, that meets a narrow definition of violent punishment leaving a lasting impact, like scars or disability, Mr. Nowak said. Officials have not done enough to outlaw physical or psychological abuse that does not produce a visible injury, Mr. Nowak said.

He said his investigation showed that such techniques include hooding and blindfolding, beating by fellow prisoners, use of handcuffs and ankle fetters for long periods, exposure to extreme heat or cold, being forced to maintain awkward postures for long periods and the denial of medical treatment. Sleep deprivation, he said, is perhaps the most common violation of what he called international standards of prisoner treatment.Way back in 2002, John Yoo wrote a memo for the White House noting that anything that falls short of causing "organ damage" or "imminent death" shouldn't be considered torture. The Chinese Communist Party has slightly higher standards here, but only slightly. And so long as the United States sanctions the same sort of tactics for its detainees, it will have no standing whatsoever to criticize China.

Every federal revenue door closed to Louisiana

| Fri Dec. 2, 2005 7:38 PM GMT

Though other states receive generous shares of revenues they generate by allowing production of goods on federal lands within their borders, Louisiana gets almost nothing. Louisiana produces 25% of the nation's natural gas and 30% of the nation's oi, yet it has nothing to show for it. Well, not quite nothing: the laying in of pipelines has seriously eroded the state's coastline, making it much more vulnerable to hurricanes.

For years, Louisiana's Congressional delegation has tried to get help to restore Louisiana's coastline, but there has been none. About six months ago, the White House agreed to help Louisiana, but only under the condition that the state scrap its well thought out, long-term plan to preserve its coastline. In its place, the Bush administration substituted a cheaper, short-term plan. The state, desperate to get help, reluctantly agreed. Shortly after, the White House announced that the Louisiana wetlands were no longer a priority, and that the state might not get any money at all.

Back to revenue-sharing. In 1953, President Eisenhower promised Louisiana 50% of the tax revenue earned from its oil and gas production. One person, Leander Perez, who controlled Plaquemines Parish, didn't think half of the revenues was good enough, and demanded 100%. No one could get him to back off, and as a punishment, Louisiana got nothing at all.

The state filed a suit in an attempt to get its share of the revenues, and this suit was tied up in court for about twenty years. In the early 70's, the court finally ruled that because Louisiana's oil and gas production did not occur within the state's boundaries, the state could not claim any revenue from it. This is, of course, an absurd conclusion: Without Louisiana, no one could build the platforms and rigs or lay the pipelines. Offshore workers depend on Louisiana for everything from employees to supplies to the education of their children. Yet even today, lawmakers like Sen. Jeff Bingaman of New Mexico claim that because Louisiana's oil and gas business is conducted in the water, the sate does not have a right to any money.

Had Louisiana been permitted its fair share of revenues over the decades, the state would not be in the financial shape it is in today. With no oil and gas revenue and a government that both refuses to help restore its coastline and to keep its promise about rebuilding after Katrina and Rita, Louisiana has little recourse. There is talk of filing suit against the Army Corps of Engineers, whose incompetence was largely responsible for the levee breeches during Katrina. Technically, the Corps is immune from lawsuits, but Congress can amend the immunity to exclude criminal acts, and make the amendment retroactive. Alternatively, the state could file for damages in the U.S. Court of Claims, then hope that Congress would pay the judgment. In this case, some of the blame would go to the Orleans Parish Levee Board, which was negligent in inspecting the levee system.

Some of Louisiana's coastal parishes are also considering filing a suit against the federal government in order to get the state's share of oil and gas revenues. With a wrecked economy, bills coming in from FEMA, and the "We'll do whatever it takes" promise already tossed in the trash, the state has to do something fast to find the billions of dollars its needs.

The Fight Against Urban Job Flight

Fri Dec. 2, 2005 6:18 PM GMT

Federal urban renewal programs are in the dumps. Despite intensive efforts by the Department of Housing and Urban Development, inner-city job growth declined in almost half of the country's 82 largest urban areas between 1995 and 2003, according to a new study by the Initiative for a Competitive Inner City. And even among cities that had job growth, most grew more slowly than their surrounding areas. A complementary analysis by the Associated Press found that the majority of inner-cities areas specifically targeted by federal job-stimulation programs also declined.

The ICIC study examined thirty-two areas that received assistance from HUD's Initiative for Renewal Communities and Urban Empowerment Zones (RC/EZ), a program that offers a combination of tax-break incentives and training programs to core inner-city areas with stagnant economies. Of these, only twelve gained jobs and only one, Mobile, AL, did so at a higher rate than outlying urban areas in the eight year time frame. While the RC/EZ program isn't without its isolated success stories, those don't add up to a widespread positive trend in job growth.

Those large cities that escaped the list of job losers are almost exclusively those cities that didn't receive the well-intentioned urban renewal federal aid: Anaheim, Long Beach, San Jose and Oakland, Calif.; Jersey City, Tulsa, Okla., St. Petersburg, Fld., Winston-Salem, N.C, Portland, Ore., and Seattle, Wash. Why is this?

The first question to ask is what drives inner-city job growth. According to the ICIC study, an inflow of immigrants drives job creation. Whereas immigrants compose only 12 percent of those cities that are losing jobs, growing metropolises average 31 percent. In a press release accompanying the study, ICIC founder Michael Porter, a professor at the Harvard Business School, explained:

Immigrants clearly and more readily identify the unique business conditions and opportunities that inner cities offer and are able to capitalize upon them. In addition, they are attractive to small and large businesses seeking willing and available labor.
While less statistically significant, the ICIC study also found that the diversification of industries correlated with job growth, and educational attainment level with higher wages. But policy tools that can affect these factors—creating incentives for diversification and expanding educational opportunities—are tricks that HUD has tried before, again with mixed results.

The Harvard Institute for Strategy and Competitiveness, an organization also directed by Porter, focuses on the microeconomic foundations of development, implying that entrepreneurial solutions are the key.

But the unwelcome answer to stagnant job growth may be neither federal assistance nor a laissez-faire approach. Lost jobs in the metropolises are being gained in neighboring suburban areas that are quickly urbanizing. Between 1990 and 2000, population growth in suburbs was twice that of the largest cities, 18 versus 9 percent. The nationwide decentralization trend isn't necessarily a problem in itself, but urban cores are often the source of technology and idea generation.

Bruce Katz, former HUD secretary from 1993 to 1996, wrote in a 2003 paper that it is primarily the "metropolitan areas without strong central cities…[that] are having so much difficulty making the transition to a higher road economy." Katz also points to "anti-metropolitan" federal policies that retard economic growth. For example:

  • Transportation funds generated in cities funneled for spending in rural areas
  • Concentrating poverty by housing the poor in segregated city blocks
  • Creating prohibitively high costs to new businesses by designating environmental "brownfield" sites in polluted cities
  • While the 1990s saw some corrections on these distorting policies, Katz told Mother Jones that the Bush administration reversed reformative progress in his first term.

    Bush is talking about cutting grants which enable cities to deal with the basic infrastructure issues. What Bush is talking about cutting are the basic community health programs that are not specifically targeted on job creation but create the climate for job creation to occur.

    Nevertheless, for the short term urban development will be shaped by the Bush administration, who earlier this year proposed to cut billions from HUD's buget, which may be a fine stroke against the deficit, but bad for inner city growth after all.

    In Detroit, Michigan, where jobs are down to 345,000 from 735,000 in 1970, more jobs were lost than in any other major city in the nation, about a 19 percent decrease.
    Detroit successfully secured an urban renewal tax-break package in 2001 with the help of Patrick Anderson's consulting group, but it was rejected by the succeeding mayor. Speaking to the Detroit News, Anderson stressed that government hand-outs don't work, but on a local level,

    All you have to do is stroll through downtown Chicago or parts of Washington, D.C., that have been rejuvenated. […] These tend to be cities that get the basics right. They pick up the trash. They keep the criminals off the streets. The lighting works and they have a well-run government that's not at war with the suburbs.
    Katz agrees:
    I think the issue is: why do businesses locate where they do? They locate because of proximity to markets, reliable workforce, a transparent real estate process, a decent tax structure, an efficient government, and information about markets that enable them to take a risk. And after all that, maybe a tax incentive wouldn't hurt but you need to start with the basics.
    He stressed that it's not so much "economic-stimulus" projects that create jobs, but programs that indirectly help job growth by creating an environment for business. This is also where the bulk of federal money goes: including health care, transportation, earned income tax credit.

    Can Wal-Mart Reform Itself?

    | Fri Dec. 2, 2005 10:56 AM GMT

    Via Ezra Klein, who has a lot of interesting things to say about this, here's the progressive case for Wal-Mart, by Jason Furman. The paper makes some solid points, though as Max Sawicky points out, it's unlikely that the effect of Wal-Mart's low prices can compensate for rock-bottom wages for the lowest income groups. But set that aside. The weakest part of the paper, I think, is that Furman seems to believe that just because Wal-Mart has some positive and progressive effects on the economy, it can also be a progressive company.

    If Wal-Mart were committed to the welfare of its more than 1.3 million "associates," as it calls its workers, then it would push to expand these public programs. Instead, Wal-Mart and the Walton family have generally worked against the progressive issues that would benefit its employees, including funding campaigns advocating the repeal of the estate tax. Recently, Wal-Mart has come around to endorsing a higher minimum wage, but this limited step is outweighed by its consistent funding for attempts to roll back progressive priorities that would benefit its workers.

    This seems almost willfully naïve. Of course Wal-Mart works "against the progressive issues that would benefit its employees." Why wouldn't it? In as much as Wal-Mart can be said to be an entity that "wants" and lobbies for things, it will want a) lower corporate taxes, b) lower taxes for its managers and owners, c) lax corporate and workplace regulation, and d) a governing party that can distract the working class with cultural issues. Now which party delivers that?


    Ezra seems to think that Wal-Mart can somehow be convinced to become a progressive ally and support universal health care in order to lower its labor costs. Nonsense, I say. If Wal-Mart's worried about its health care costs it will stump for a Republican health care plan that leaves workers at the mercy of the sharks in the open insurance market and ensures that Wal-Mart, along with its managers and shareholders, pay as little as possible for the scheme. Back to Furman:

    Finally, Wal-Mart should obey labor laws that bar gender discrimination, unpaid overtime and environmental laws like the Clean Air Act. I do not know whether or not Wal-Mart has systematically broken these laws; to the degree it has, the remedy is through the legal system, not through restricting the expansion of Wal-Mart into new areas or applying new mandates to a single company.

    Aargh. That ignores the fact that Wal-Mart, along with other corporate interests, gets involved in politics precisely to neuter the legal system that's supposed to act as a "remedy"—trying to limit its liability from class-action lawsuits through tort "reform," and trying to weaken workplace regulations, and so on. More to the point, the legal system as currently structured is inadequate for dealing with corporations like Wal-Mart. The company has shown no remorse for anything it has done, any of the workers it has mistreated, any of the laws it has broken, and considers paying fines simply a cost of doing business.


    This is why many people support the death penalty for corporations. In the short term it would be disastrous for many people, not least the company's 1.3 million employees, if Wal-Mart's corporate charter was revoked and its assets auctioned off. But understandably, many people feel that drastic action is necessary to teach corporations that you don't lock workers in the store after hours, you don't treat undocumented workers like indentured servants, and you don't let children operate heavy machinery just so that economists can gush over your "productivity growth." Now there are certainly problems with the corporate death penalty, and personally I have mixed feelings on it, but the idea gets at the general problem here: you can't just ask Wal-Mart to play nice.

    That's exactly why, as Matt Yglesias says, unions are so important—so that there is some countervailing power fighting against corporate-friendly changes to the legal system and hideous labor practices. That's why the SEIU wants to unionize the company, so it can tip the balance of power, and Wal-Mart stands in the way. Trying to "get along" won't get the job done.

    Now Ezra's totally right to say that there are real problems with simply demanding that Wal-Mart offer its workers health care—employer-based health care is a very flawed system. Better to get a more rational universal health care system. But quite naturally, unions don't think universal health care is ever going to come, and that any such system would inevitably be weakened by corporate lobbyists hired by, among others, Wal-Mart. Ezra's trying to think through what a more rational long-term strategy to get to universal health care would look like. I'd love to see it, and think it's a worthwhile project. But I don't think it does any good expect that Wal-Mart can ever be "persuaded" to fight for the working class and single-payer health care. It's still a war and always will be.