The Fine Print

The Fine Print - David Cay JohnstonEarlier this year, David Cay Johnston published a new book, The Fine Print. After reading his last book, Free Lunch, I just couldn’t take 300 more pages about how the corporations game the system.

I did, however, scan the book, reading some parts of it in depth. It’s a good book, of course, Johnston has rightly become a liberal hero to many of us. He is someone I always want to read and hear, because he has keen and well-informed insights about everything that is going on.

He starts the book by showing how AT&T manages to make more from us than it ever did, even though the cost of their primary services have plummeted. They do it by charging extra for things that most people never use, and in many cases cannot use. But it isn’t just AT&T. I was struck by the case of Bank of America over-charging for bounced checks. Currently, they change $47 for the first bounced check:

What does it cost banks to deal with a bounced check? Back in the late 1970s, when checks were still processed by a person and a machine rather than digitally, Crocker Bank (now part of Wells Fargo) was forced to reveal in a California court case that its cost was thirty cents. At that time, the bank was charging customers $6 for bounced checks, a markup of 2,000 percent. The California Supreme Court held that charging twenty times cost was not necessarily unconscionable. Adjusted for inflation, that $6 fee would now be $21, less than half what BofA charges.

What are today’s bank costs for processing a bounced check? BofA won’t tell customers, but research papers on costs in the digital era suggest it could be less than a penny, making the market by BofA in the neighborhood of 470,000 percent. But corporate values now so infuse our society that price gouging is easily brushed off as a function of competition, regardless of whether that’s the truth or an ideological fantasy.

At the end of the book, in discussing “What it All Means,” he talks about “Faux Free Trade.” I’m not in favor of free trade agreements; they are like most things that everyone in the Beltway think are good ideas: another way to make the powerful more powerful. Johnston provides more evidence. This quote strikes me as a little slippery, though (I’ll let you know if I find out more):

One crucial fact is often left unsaid: our trade with countries where we do not have so-called free trade agreements is growing faster than with countries with which we have such agreements.

Of course, when someone agrees with me about one of my favorite rant subjects, I know he must be brilliant. On the subject of the stimulus, Johnston write:

If Obama becomes a one-term president, historians will note his failure to insist on a bigger stimulus, to spend the money fast and that business tax cuts do nothing for companies that pay little or no tax. Besides, no one hires workers to get a tax cut. Businesses hire more workers when they have customers who want their goods and services, not when someone dangles a tax cut in front of them.

In Obama’s defense, the tax cuts were there to get Republicans to vote for it. The fact that almost none of them did does tarnish the argument a bit.

One can never go wrong spending some hours meditating with David Cay Johnston. The Fine Print is a good book that deserves your (and after the election, maybe my) full attention.

Syncing 32 Metronomes

MetronomeThis is really interesting even you aren’t a physicist. These people have started 32 metronomes at random times. Then, over the course of about 2 minutes, 31 of the metronomes get in sync and 1 gets perfectly out of sync. This one metronome that is anti-synced seems like it will stay that way. Apparently, this position is an unstable equilibrium, however. What that means is that while it is in equilibrium, everything is fine. But if the movement of the shaking table pushes it slightly off that equilibrium, it will just keep moving, eventually landed at the sync state—which is stable. This takes another 2 minutes.

It seems that all that is happening here is that the metronomes are placed on a swing. This internal forcing causes the metronomes to gravitate toward a shared phase. Note that the frequency of the ticking is given: all the metronomes are set at the same frequency. Setting all of the metronomes at different frequencies could create some interesting percussive music. I’m thinking John Cage.

Do We Need Better Candidates?

Matt TaibbiMatt Taibbi wrote a provocative article on Tuesday, This Presidential Race Should Never Have Been This Close. In it, he argues that Obama should have a huge lead, even if Romney were a good candidate, which he isn’t.

This goes completely against the conventional wisdom (especially among conservatives) that Obama ought to be losing this election. The idea is that the bad economy should make the incumbent vulnerable. But this is wrong. Political scientists have found that the biggest force determining whether a President is reelected is the economic trend in the few months before the election. Most of the punditocracy has misinterpreted this to mean that the determining force is the economic state. Today, although the economy is very bad, and it is improving slowly, it is still improving. As Ezra Klein wrote a couple of weeks back, “Things are going exactly as the political scientists expected.”

What I’ve noticed over the years is that all of the campaign minutia that I, as much as anyone, obsess over makes very little difference in the election. Broader trends seem to swamp everything else. We do see movement in people’s choices. Debates in 1984 and 2004 both caused a 5% swing for the challenger (as I recall), but in the end they still both lost. In 1992, pundits claimed that Bush Sr. lost the election because of the vile RNC, but I don’t think many voters even noticed. And now, people think of Romney as an entitled rich guy, but I’m sure he would still win if the economy was again in free fall.

Taibbi’s argument is deeper than this. He claims that there really is a 99%-1% divide in this country. Unfortunately, one of our candidates is owned by the super rich and the other is the super rich. He says that things would be different if we were given a real choice:

If this race had even one guy running in it who didn’t take money from all the usual quarters and actually represented the economic interests of ordinary people, it wouldn’t be close. It shouldn’t be close. If one percent of the country controls forty percent of the country’s wealth—and that trend is moving rapidly in the direction of more inequality with each successive year—what kind of split should we have, given that at least one of the candidates enthusiastically and unapologetically represents the interests of that one percent?

This is a common liberal lament: regardless of what the people call themselves, the policies they overwhelmingly prefer are liberal. Thus, the argument goes, if they were given a true liberal choice, they would vote for it by great majorities. I’m sympathetic to this idea. However, I think it is a big mistake to assume that people are rational—whether in economics or politics. As Thomas Frank shows in What’s the Matter with Kansas? many people are convinced to vote against their real economic interests for the fantasy that they are voting for their social interests. My favorite passage from his book:

Behold the political alignment that Kansas is pioneering for us all. The corporate world—for reasons having a great deal to do with its corporateness—blankets the nation with a cultural style designed to offend and to pretend-subvert: sassy teens in Skechers flout the Man; bigoted churchgoing moms don’t tolerate their daughters’ cool liberated friends; hipsters dressed in T-shirts reading “FCUK” snicker at the suits who just don’t get it. It’s meant to be offensive, and Kansas is duly offended. The state watches impotently as its culture, beamed in from the coasts, becomes coarser and more offensive by the year. Kansas aches for revenge. Kansas gloats when celebrities say stupid things; it cheers when movie stars go to jail. And when two female rock stars exchange a lascivious kiss on national TV, Kansas goes haywire. Kansas screams for the heads of the liberal elite. Kansas comes running to the polling place. And Kansas cuts those rock stars’ taxes.

That’s not the only reason that people wouldn’t necessarily flock to vote for a real economic progressive. But I think that Matt Taibbi is right that the nation would like a real choice. And in the end, “We win. Because our ideas are better.”[1]


[1] This is from Primary Colors.

Let Karen Finney Speak!

Karen FinneyAs regular readers know, I indulge my crushes on minor celebrities, academics, and grammarians. But no one knows about my most recent crush: Karen Finney. She was Director of Communications at the Democratic National Committee under Howard Dean. But I know her as a pundit on The Last Word.

As you can see in the picture, Finney is a beautiful woman. But you know me, I’m not easily impressed by a pretty face. The truth is that I find her analysis enlightening. I’m surprised that she isn’t a bigger deal—especially considering what a knock out she is. But what do I know? (Actually, I have a theory: I think the TV machine prefers androgynous women, and Finney is womanly in a Marilyn Monroe way; the TV machine wants girls, not women. More evidence of our cultural decline.)

During her segments on the last two episodes of The Last Word, Karen Finney has been allowed to talk only one time during each. Check out this last segment; her look at the end is priceless:

Lawrence O’Donnell: let this brilliant woman speak!

My Name is Alberto Asenjo…

Alberto Casillas AsenjoEverybody loves a Spanish badass!

Alberto Casillas Asenjo is the owner of the Prado Cafe in Madrid. During the clash between protesters and police, he stood defiantly in his doorway. Click on over, the video is great. What most strikes me is that he is clearly afraid. And yet, he stays. That’s true bravery.

Of course, I had hoped to hear, “Hello. My name is Alberto Asenjo. You killed my father. Prepare to die.”