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The Path to $10,000-an-Ounce Gold
By Dan Amoss - DailyReckoning.com
07/02/12 Jacobus, Pennsylvania – There's a plausible path to $10,000 an ounce gold. And it doesn't require a breakdown in civil society…
Speculators see central bankers as modern-day superheroes, able to push markets around with a single phrase. In the minds of most investors, Ben Bernanke, Mario Draghi and Masaaki Shirakawa might as well be wearing tights, masks and capes. These superhero central bankers continuously swoop down into the financial markets to defend them from downticks…and to insure that they always deliver capital gains.
Is the Table Set for a Mania in Precious Metals?
By Jeff Clark - DailyReckoning.com
06/29/12 It may feel like I'm out of touch with the precious metals markets to broach the subject of a mania today, but I think the table is being set now for a huge move into gold and silver.
There are, however, very valid reasons to reasonably expect a mania in our sector. For one thing, manias have occurred many times before, but the main issue is that a mania in gold and gold stocks is the likely result of the absolute balloon in government debt, deficit spending, and money printing. Saying all that profligacy will go away without inflationary consequences seems naïve or foolish. Inflation may not attract investors to gold and silver as much as force them to it.
R.I.P. for big banks...
Big banks craft "living wills" in case they fail
By David Henry and Dave Clarke
NEW YORK/WASHINGTON | Wed Jun 27, 2012 4:29am EDT
(Reuters) - Five of the biggest banks in the United States are putting finishing touches on plans for going out of business as part of government-mandated contingency planning that could push them to untangle their complex operations.
The plans, known as living wills, are due to regulators no later than July 1 under provisions of the Dodd-Frank financial reform law designed to end too-big-to-fail bailouts by the government. The living wills could be as long as 4,000 pages.
U.S. munis face $2 trillion in unfunded pension costs
By Joan Gralla
Mon Jul 2, 2012 7:03pm EDT
(Reuters) - U.S. states and localities have run up more than $2 trillion of unfunded pension liabilities, Moody's Investors Service said on Monday, citing data on plans offered by 8,500 local governments and over 14,000 individual entities.
The Wall Street credit agency said that according to its estimate, the total liabilities for fiscal 2010 were more than three times the amount reported by local governments.
"Pension liabilities are widely acknowledged to be understated," Moody's Managing Director Timothy Blake said in a statement. Most states end their fiscal years on June 30.
Investors in the $3.7 trillion municipal bond market are focused on whether states, counties, cities and towns can afford the pension benefits granted public workers.
When Zero Rates Don't Work
BY FREDERICK J SHEEHAN - FinancialSense.com
Jon Hilsenrath, the Wall Street Journal's ferret at the Fed, reports what the Federal Reserve wants the public to know while retaining anonymity. He found the professors in a stew. In the June 19, 2012, edition, Hilsenrath disclosed: "Fed officials have been frustrated in the past year that low interest rate policies haven't reached enough Americans to spur stronger growth, the way economics textbooks say low rates should. By reducing interest rates-the cost of credit-the Fed encourages household spending, business investment and hiring, in addition to reducing the burden of past debts. But the economy hasn't been working according to script."
Audit the Fed Headed for the House Floor!
BY RON PAUL - FinancialSense.com
Last week supporters of Federal Reserve transparency had a major victory when the House Committee on Government Oversight and Reform passed my Audit the Fed bill, HR 459 unanimously with all major audit provisions intact. This clears the way for a House floor vote expected sometime in late July, and with a whopping 263 cosponsors, the chances of it passing have never looked better! This is an unprecedented opportunity for transparency into how the currency of the United States is handled, and mishandled by the Federal Reserve. It is more important than ever that my colleagues in the House and Senate understand what this legislation does and why it is so important.
How Government Spending Continues to Add Fuel to the Fire
By Bill Bonner - DailyReckoning.com
07/02/12 Paris, France – "France is rotten," said a friend yesterday. "I don't know why you came back. Half the people are broke. The other half are crazy…
"…and you foreigners still come here, pay $1 million for a hole-in-the-wall apartment…and walk around the city and step in dogsh*t."
Yes, dear reader, that is a fair description of France circa 2012. The new president, Francois Hollande, says he won't wait for the private sector to create jobs. He will do it himself. He'll hire more teachers. Never mind that the payback on educational spending is zero — or less. It sounds good to the lumpen-voters.
Taxmageddon Just Got More Frightening
BY DIANE ALTER, Contributing Writer, Money Morning
Political battles will take center stage in the second half of 2012, but few loom larger than the scheduled tax increases - "Taxmageddon" - set to take effect in January 2013.
Bush-era tax cuts, payroll tax breaks and other provisions set to expire next year could pack an enormous financial hit, harming the already-fragile U.S. economy and thousands of struggling families. While Democrats and Republicans alike are opposed to letting all the cuts expire, they disagree on exactly what to do about it.
Republicans blame U.S. President Barack Obama and his administration for the stalemate.
Get Ready for the New Investment Tax
By LAURA SAUNDERS - WSJ.com
WSJ's Laura Saunders digs deep inside the affordable health-care law affirmed by The Supreme Court this week and reveals a little-known income tax that many call a game-changer.
It really is happening.
Until this week, investors were waiting to see what the Supreme Court would do about the 3.8 percentage-point surtax on investment income, part of President Obama's health-care overhaul. The Internal Revenue Service hasn't yet released guidance on the new tax.
Europe: Sputtering toward oblivion
The eurozone crisis at an end right? Not a chance.
By Cyrus Sanati - Fortune.com
FORTUNE -- European leaders continue to apply flimsy Band-Aids to their gushing economic wounds in an effort to avoid making the hard decisions necessary to save the euro from oblivion. The 19th "emergency" EU summit to be called since the European debt crisis began over two years ago concluded on Friday with yet another sputtering salvo of stop-gap measures and shaky promises. There was little, if any, talk of tackling the structural problems behind the crisis, with leaders still at odds over how they will philosophically go about solving the issue.
Europe and Yogi Berra
BY DAVID KOTOK - FinancialSense.com
"We affirm that it is imperative to break the vicious circle between banks and sovereigns." Press Release, Euro area summit, June 29, 2012
European leaders have finally determined something that was apparent to everyone for years. Now comes the difficult part: how to implement a euro zone-wide banking system. Will sovereign countries give up their sovereignty and submit to a euro zone-wide authority? We shall see.
Meanwhile, in order to accomplish this agreement, Germany, under the leadership of Angela Merkel, achieved something she wanted without having to give up anything. Germany had previously insisted that the coming European Stability Mechanism (ESM) crisis-funding facility have seniority status relative to other sovereign debt claims. Germany's allies in this position included other northern eurozone countries, like Finland. The southern countries had not agreed to this status since it would have created a market based pricing of their multi-tiered sovereign debt..
Euro compromises likely to unravel
Merkel weakened at home by Brussels concessions
By David Marsh, MarketWatch
MADRID (MarketWatch) — The major German concessions (above all, over the use of ESM European rescue funds directly for Spanish banking recapitalization) agreed at the euro summit are unlikely to enter into force. The compromises announced on Friday between creditors and debtors will fall apart because they are mutually contradictory.
The good news (of sorts) is that the European Central Bank is out of the firing line for the moment. It can cut interest rates by ¼ percentage point on Thursday without being accused of kowtowing to government pressure. ECB bond purchases, hotly opposed by the Germans and a steadily growing band of other countries, are off the agenda as the focus switches to taxpayer-backed rescue devices.
Kicking The Can Down The Road
By Michael Snyder - TheEconomicCollapseBlog.com
Has Europe finally been saved this time? Has this latest "breakthrough" solved the European debt crisis? Of course not, and you should know better by now. European leaders have held 18 summits since the beginning of the debt crisis. After most of the preceding summits, global financial markets responded with joy because European leaders had reached "a deal" which would supposedly solve the crisis. But a few weeks after each summit it would become clear that nothing had been solved and that the financial crisis had actually gotten even worse than before. How many times do they expect us to fall for the same sorry routine? Nothing in Europe has been solved. You can't solve a debt problem with more debt. European leaders are just kicking the can down the road. More debt will relieve some of the short-term pressure, but in a few weeks it will be apparent that the underlying problems in Europe continue to grow. Unfortunately, there is not an unlimited amount of EU bailout money, so once all of these "financial bullets" have been fired European leaders are going to find that kicking the can down the road will not be so easy anymore. The truth is that the financial crisis in Europe has not been cancelled - it has just been put off for a few weeks or a few months.
At Long Last the Euro Is Finally Being Saved
BY CHRISTOPHER QUIGLEY - FinancialSense.com
Friday the 29th of June 2012 will go down as one of the most important dates in the history of the Euro currency. In the early hours of that fateful morning German resistance to a rational and comprehensive resolution to the Euro crisis was finally crushed. It will take some time for the full implications of this historic result to filter through to the markets but the fact that the dark cloud of dissolution of the Euro is now passing can only be positive.
What happened? Why did Angel Merkel the German Chancellor finally "blink in earnest" as suggested in our article two weeks ago? The answer is she was outmaneuvered by Italy and Spain with the tacit support of France. In essence she was totally isolated. Here is what SPIEGEL the German online newspaper had to say about events:
Paris short €43bn to meet EU deficit targets
BY HONOR MAHONY - EUObserver.com
BRUSSELS - The French government will have to find €43bn in order to bring the country's deficit in line with EU rules by 2013, a fresh report has shown.
A report on state finances by the national Court of Auditors said Paris will need to find up to €10bn this year and €33bn next year to reduce its budget deficit to 4.5 percent of GDP and then 3 percent of GDP.
"The situation remains extremely worrying," court president Didier Migaud told Le Monde newspaper, referring to the state of the country's public finances.
Fed won't let easy policy spark inflation: Williams
By Braden Reddall
SAN FRANCISCO | Mon Jul 2, 2012 3:52pm EDT
(Reuters) - The U.S. Federal Reserve is ready to ratchet back its super-easy monetary policy when the time comes so as to head off any uncontrolled price rises, a top Fed official said on Monday.
"Just as in any recovery, we are going to take away the punch bowl once the party really gets going, to slow the economy down and dampen inflationary pressures and keep inflation low," San Francisco Federal Reserve Bank President John Williams told the Western Economic Association International.
Ex-Brokers Say JPMorgan Favored
Selling Bank's Own Funds Over Others
BY SUSANNE CRAIG AND JESSICA SILVER-GREENBERG - NYTimes.com
Facing a slump after the financial crisis, JPMorgan Chase turned to ordinary investors to make up for the lost profit.
But as the bank became one of the nation's largestmutual fund managers, some current and former brokers say it emphasized its sales over clients' needs.
These financial advisers say they were encouraged, at times, to favor JPMorgan's own products even when competitors had better-performing or cheaper options. With one crucial offering, the bank exaggerated the returns of what it was selling in marketing materials, according to JPMorgan documents reviewed by The New York Times.
JPMorgan's $10 Billion Subsidy
By Brendan Greeley - BuainessWeek.com
In late June, Jamie Dimon told a Senate committee thatno taxpayer money was "impacted" by this spring's trading losses at JPMorgan Chase (JPM). Dimon, the bank's CEO, meant that no one at the Treasury Department had to write a check to save the bank. He's right, and likely to continue to be right, even after the revelation that the bank's trading losses might run as high as $9 billion. But checks are not the only thing of value the federal government can offer a bank.
Barclays and JPMorgan: When Big Banks Get Too Big
By SUZANNE MCGEE, The Fiscal Times
This article was updated on Monday, July 2, at 2:45 p.m.
Big banks just can't seem to catch a break. While publicly griping about the costs involved with all the new regulations that have been introduced since the financial system teetered on the brink of collapse back in 2008, they seem to remain intent on reminding us just why those regulations – or something else of the same kind – were needed in the first place.
Making matters all the more worrying, the two banks that provided those reminders last week have until now been seen as relatively healthy institutions, and "winners" in the wake of the crisis.
77% of JP Morgan's Net Income
Comes from Government Subsidies
by George Washington - ZeroHedge.com
JP Morgan's credit rating would be much lower without government backing.
As Bloomberg noted last week:
JPMorgan benefited from the assumption that there's a "very high likelihood" the U.S. government would back the bank's bondholders and creditors if it defaulted on its debt, according to the statement. Without the implied federal backing, JPMorgan's long-term deposit rating would have been three levels lower and its senior debt would have dropped two more steps, Moody's said.
And as the editors of Bloomberg pointed out a couple of weeks ago:
JPMorgan receives a government subsidy worth about $14 billion a year, according to research published by the International Monetary Fundand our own analysis of bank balance sheets. The money helps the bank pay big salaries and bonuses. More important, it distorts markets, fueling crises such as the recent subprime-lending disaster and the sovereign-debt debacle that is now threatening to destroy the euro and sink the global economy.
The Implications of the Trans-Pacific Partnership
When Corporations Are Answerable Only to Themselves
by PAUL CRAIG ROBERTS - CounterPunch.org
Information has been leaked about the Trans Pacific Partnership, which is being negotiated in secret by US Trade Representative Ron Kirk. Six hundred corporate "advisors" are in on the know, but not Congress or the media. Ron Wyden, chairman of the Senate trade subcommittee that has jurisdiction over the TPP, has not been permitted to see the text or to know the content.
The TPP has been called a "one-percenter" power tool. The agreement essentially abolishes the accountability of foreign corporations to governments of countries with which they trade. Indeed, the agreement makes governments accountable to corporations for costs imposed by regulations, including health, safety and environmental regulations. The agreement gives corporations the right to make governments pay them for the cost of complying with the regulations of government. One wonders how long environmental, labor, and financial regulation can survive when the costs of compliance are imposed on the taxpayers of countries and not on the economic activity that results in spillover effects such as pollution..
The Bleeding Edge of a Scary Economic Trend
By Bruce Watson - DailyFinance.com
On Thursday, Stockton, Calif., became the biggest U.S. city in history to file for bankruptcy. At the same time, it also became the new face of America's national budget battle. For while Stockton is relatively rare in facing budget troubles so intractable that they necessitate a Chapter 9 filing, its struggle to put its financial house in order illuminates the wider problems facing the entire country in the wake of the Great Recession.
Municipal bankruptcies are nothing new -- as The San Francisco Chronicle reported earlier this week, there have been 42 since 1981. In recent years, though, the number of bankruptcies has sharply increased; since 2008, 10 municipalities have sought court protection to help them discharge their debts.
Time to Get Crazy
By Chris Hedges - Truthdig.com
Native Americans' resistance to the westward expansion of Europeans took two forms. One was violence. The other was accommodation. Neither worked. Their land was stolen, their communities were decimated, their women and children were gunned down and the environment was ravaged. There was no legal recourse. There was no justice. There never is for the oppressed. And as we face similar forces of predatory, unchecked corporate power intent on ruthless exploitation and stripping us of legal and physical protection, we must confront how we will respond.
The ideologues of rapacious capitalism, like members of a primitive cult, chant the false mantra that natural resources and expansion are infinite. They dismiss calls for equitable distribution as unnecessary. They say that all will soon share in the "expanding" wealth, which in fact is swiftly diminishing. And as the whole demented project unravels, the elites flee like roaches to their sanctuaries. At the very end, it all will come down like a house of cards.
This Is the Most Important Thing We Could Do for the Economy
If Ben Bernanke won't act, principal reductions just might be the most powerful tool we have for breaking open the housing recovery
By Matthew O'Brien - TheAtlantic.com
There was a bubble. Then were was a bust. Now there's a mess that's holding back the recovery. Even if there is nascent housing recovery underway, there are still two big stories holding back a big housing rebound. The first is the Fed not doing enough. Unless Ben Bernanke & Co. signal that they'd be willing to tolerate more inflation for a bit of time, credit will remain tight. The second is the awful legacy of the burst bubble -- underwater mortgages, foreclosures, and shadow supply -- acting as a persistent drag on the sector.
What is to be done? Stopping foreclosures is the first step. That prevents shadow supply from piling up, prices getting dragged down, and more owners falling underwater. In other words, it means modifying mortgages.
How Wall Street Scams Counties Into Bankruptcy
By William D. Cohan - Bloomberg.com
Lord knows we've had more than enough scandals ginned up by Wall Street over the years, and the message that banking executives proclaim after each is: "Don't worry, we've learned that lesson, and it will never happen again."
Which is how we got to the recent spectacle of Jamie Dimon, the chief executive officer ofJPMorgan Chase & Co. (JPM), testifying twice before Congress that although the bank's chief investment office was taking huge proprietary risks with some $350 billion of its depositors' money -- and lost $3 billion (and counting) by making a bunch of risky bets on an obscure, thinly traded derivatives contract -- everything is now fine and dandy because the unjustifiable gambling has been stopped dead in its tracks.
California lawmakers pass historic foreclosure protections
By Marc Lifsher and Alejandro Lazo, Los Angeles Times
SACRAMENTO — California lawmakers have passed historic legislation that would provide homeowners with some of the nation's strongest protections from foreclosure and aggressive bank practices, such as when a lender tries to seize a home even as the resident negotiates to lower mortgage payments.
After years of housing and mortgage market distress during which lenders seized nearly a million California houses, legislators on Monday sent a pair of Assembly and Senate bills to the governor designed to help financially distressed borrowers stay in their homes.
Mammoth Lakes files for bankruptcy
By Louis Sahagun - LATimes.com
The High Sierra town of Mammoth Lakes said Monday that it filed for bankruptcy because it cannot afford to pay a $43-million breach-of-contract judgment against it brought by a developer.
In a prepared statement, Mammoth Lakes officials said "bankruptcy, unfortunately, is the only option left" for the town, whose largest creditor, Mammoth Lakes Land Acquisition, had won a state court order requiring full payment by June 30, 2012.
Kodak Can Sell Its Patents In Bankruptcy, Judge Rules
By David McLaughlin - Bloomberg.com
Eastman Kodak Co. (EKDKQ), the photography pioneer that seeks to sell digital-imaging patents, won court approval to auction the assets as part of its bankruptcy restructuring.
U.S. Bankruptcy Judge Allan Gropper in Manhattan said at a hearing today that he would approve an order allowing a sale process for more than 1,100 patents.
Kodak is selling its digital-imaging patents as part of a plan to shrink the company and focus on printing rather than photography. Kodak says the patents relate to the capture, manipulation and sharing of digital images.
Do You Have More Debt Than the Average American?
By Molly McCluskey, The Motley Fool - DailyFinance.com
Since the beginning of the recession, Americans have been saving more, paying down debt, and curbing spending. Now, a new study shows that individual debt is falling at the fastest rate in nearly 50 years. But not everyone is contributing positively to that statistic, and many Americans are still struggling with overwhelming debt.
Americans have increasingly been paying down their mortgage and credit card balances. But even as total consumer debt has diminished by approximately $100 billion (down to a mere $11.4 trillion), more than $1 trillion of our current debt load is delinquent, and nearly $800 billion of that is overdue by more than 90 days. And while owing less is a good thing, the study shows that we're burning through our savings to pay our debts down. The overall net worth of the average American is down nearly 40% from 2007 to 2010.
8,733,461: Workers on Federal 'Disability'
Exceed Population of New York City
By Terence P. Jeffrey - CNSNews.com
(CNSNews.com) - A record of 8,733,461 workers took federal disability insurance payments in June 2012, according to the Social Security Administration. That was up from 8,707,185 in May.
It also exceeds the entire population of New York City, which according to the Census Bureau's latest estimate hit 8,244,910 in July 2011.
There has been a dramatic shrinkage in the United States over the past 20 years in the number of workers actually employed and earning paychecks per worker who is not employed and is taking federal disability insurance payments.
The Right's Top 5 Theories For John Roberts' Betrayal
By SAHIL KAPUR - TalkingPointsMemo.com
Within just a few hours of the Supreme Court handing down its decision last Thursday in the health care reform case, some legal commentators were wondering out loud if Chief Justice John Roberts had flipped positions during deliberations. Teasing out tea leaves from the text of the dissent written by the court's four remaining conservative justices, court watchers from Paul Camposto David Bernstein speculated that Roberts had originally been aligned with his conservative brethren before switching sides and writing the majority opinion.
How Obamacare Could Help You Retire Earlier
(or Destroy Itself Trying)
By Chuck Saletta, The Motley Fool - DailyFinance.com
Now that the Supreme Court has ruled the Patient Protection and Affordable Care Act constitutional, it's time to consider how best to use it to your advantage. One way to benefit is that if you're looking to retire early, the court's decision could have just handed you the biggest gift of your life.
The reason is that two of the law's key features -- guaranteed coverage and subsidized premiums -- play right into the hands of those who'd like to leave the rat race behind them. With guaranteed coverage, anyone who wants to can buy insurance, regardless of pre-existing conditions. With subsidized premiums, taxpayers could be on the hook for paying premiums for anyone making less than 400% of the poverty level.
Should Small Businesses Really Fear Obamacare?
The official plaintiff in the Obamacare case was the main small-business lobbying organization. In fact, the new health care law should be a boon to entrepreneurs.
By Matthew Yglesias - Slate.com
The landmark health care case decided last week by the Supreme Court was a win for the Obama administration and a loss for the Republican Party. But the official plaintiff in the case wasn't a Republican congressional leader or even one of the conservative attorneys general whose activism fueled the litigation. It was the National Federation of Independent Businesses, a small-business membership organization and lobbying group that strongly opposed the law.
So is defeat a disaster for small business? Almost certainly not, though it may prove to be a disaster for NFIB's main policy priority of low taxes.
The bill in fact contains substantial benefits (some might even say giveaways) for small businesses. That starts with a program already under way to offer special subsidies to firms with fewer than 25 employees that want to offer health benefits. As long as your employees earn less than $50,000 on average (law firms, medical practices, and other elite professional partnership are thus ineligible), you can get a tax credit to defray 35 percent of the cost of the insurance if you're a for-profit firm, and 25 percent if you're a nonprofit. When the law really gets rolling in 2014, those subsidies rise to 50 percent for for-profits and 35 percent for nonprofits.
Is Obamacare's Individual Mandate
Really The Largest Tax Hike In The History Of The World?
By BRIAN BEUTLER - TalkingPointsMemo.com
Before the Supreme Court upheld the Affordable Care Act, the principal GOP lines of attack against the law were hyperbolic, but subjective: government takeover of health care, unconstitutional overreach, etc.
From the moment the Court determined the law stands as an exercise of Congress' taxing power, though, Republicans have gone empirical. They now say that if the mandate is a tax, then it's one of the greatest tax hikes in history.
Suddenly, everyone wants out.
By ANDREW B. WILSON - The American Spectator.org
You would have thought that Chief Justice John Roberts had shouted "fire" in a crowded theater. In upholding Obamacare, he set off a headlong race for the exits by the same lobbying groups -- believe it or not -- that had cut deals with the administration to create the legislation. Back then, the lobbyists were telling each other: If you're not at the table, you're on the menu. Now the bodies are piling up in the doorway as those who pandered to the president trample over each other in their haste to get out of the blazing or crumbling structure that is Obamacare. To paraphrase Oscar Wilde on the death of Little Nell, no one without a heart of stone can witness this deadly scene without wanting to laugh out loud.
As reported on the front page of this weekend's Wall Street Journal, every one of the health-care industry groups that signed on to Obamacare in 2009 is looking for a way out.
Chief Justice John Roberts Bowed
To Political Pressure
And Changed His Vote On Obamacare
By Michael Snyder - EndOfTheAmericanDream.com
It is being reported that after oral arguments were finished back in March, Supreme Court Chief Justice John Roberts was planning to join with the other conservative justices in ruling that the individual mandate in Obamacare was unconstitutional. But something changed. According to Jan Crawford of CBS News, two sources with "specific knowledge" of the deliberations at the Supreme Court told her that at some point Roberts switched his position and decided to uphold Obamacare. Roberts decided to characterize the penalty for not complying with the individual mandate as a tax. This argument had been rejected by the lower courts and supporters of Obamacare had considered that argument to be essentially a legal "Hail Mary" with almost no chance of success. But this is how the legal system in America works. Judges decide what they want the result of a case to be, and then they try to figure out a way to justify it under the Constitution and under existing law. Often, judges will go through all sorts of mental gymnastics to get to the results that they want. Most Americans would be absolutely shocked if they truly realized what goes on behind closed doors in our legal system.
The States Already On Record
Rejecting The 'Obamacare' Medicaid Expansion
By SAHIL KAPUR - TalkingPointsMemo.com
Although the Supreme Court upheld 'Obamacare', the ruling complicates an important element of the law by making the Medicaid expansion optional for states. States will no longer risk losing all their Medicaid funds if they opt out of the expansion, which is projected to cover some 17 million low-income people.
Most states will be hard-pressed to turn down the infusion of federal funds to help cover their uninsured residents, despite incurring new costs down the road. But Republican governors face a genuine political predicament because if they accept the Medicaid expansion, they open themselves up to potentially resonant right-wing attacks for buttressing 'Obamacare.'
Why Mayors Might Want Obamacare
Even If GOP Governors Reject It
A lot of uncompensated health-care spending comes out of municipal budgets, not state ones, and the bill could save strapped cities money.
By Garance Franke-Ruta - TheAtlantic.com
Center for American Progress President Neera Tanden, who worked to develop the health-care overhaul for President Obama before returning to Washington's think tank sector, laid out a reason rejection of the Medicaid expansion provision in the recently upheld law by Republican governors might not be so very popular at the state level.
"There is a sort of political economy problem on Medicaid," she said, turning to the part of the Affordable Care Act that was not upheld by the Supreme Court. States cannot be mandated to accept the expansion of Medicaid, even with a 100 percent federal match to begin with, or risk losing all their Medicaid funding, the court ruled. Ten GOP governors "have said definitively that they will not accept the funds, while 19 are still considering other options," according to a ThinkProgress survey.
Health-care law's Medicaid provision too good to pass up
Over the coming weeks and months, you're going to hear a lot of Republican governors fulminate against the Affordable Care Act and swear to do everything possible to stand in its way — including refusing to participate in the Medicaid expansion. In fact, the governors of Florida, South Carolina and Louisiana have already promised to do exactly that.
Ignore them. The deal the federal government is offering states on Medicaid is too good to refuse. And that's particularly true for the red states. If Mitt Romney loses the election and Republicans lose their chance to repeal the Affordable Care Act, they're going to end up participating in the law. They can't afford not to.
A Victory for Obamacare, a Defeat for the Left
The Health Care Trap
by SHAMUS COOKE - CounterPunch.org
The political victory for President Obama in the Supreme Court has created an interesting shift in American politics. More important than the blow against his Republican opponent has been the re-energizing of Obama's base, a loose coalition of liberals, labor, and leftists.
Many in these groups were lured into supporting Obamacare because of the political forces aligned against it, especially the loud extremists of the right wing. Obama's campaign skillfully exploited this fact, and soon a win for Obamacare was a strike against evil. The massive disappointment the President had been to his once enthusiastic supporters was swept aside amid anti-Republican euphoria, just in time for election season.
Jindal's Louisiana Vouchers Face Growing Legal Backlash
By CASEY MICHEL - TalkingPointsMemo.com
Louisiana Governor Bobby Jindal (R) may be currently refusing to implement 'Obamacare,' but he's displayed little reticence in pushing through a series of measures that have propelled his state into the national discussion for entirely different reasons.
State educational reforms signed into law by Jindal in April would allow low- and middle-income students in struggling public schools to receive vouchers to attend private schools. Similar programs have been utilized in about a dozen other states and have long been part of a broader educational reform favored by conservative groups.
The Missing Constitutional Argument
Why Montana's "Citizens United" Loss
at the Supreme Court was Avoidable
by JAMES MARC LEAS - CounterPunch.org
The humiliating summary reversal suffered by Montana in the US Supreme Court over its restrictions on campaign contributions could have been avoided, according to two attorneys who filed amicus(friend-of-the-court) briefs in the case.
In a statement announcing its decision, the Court majority indicated what would have been needed to avoid summary reversal: a new argument not previously raised in Citizens United or a fact that distinguished Montana's case from the federal case decided in Citizens United. The Supreme Court said:
Montana's arguments in support of the judgment below either were already rejected in Citizens United, or fail to meaningfully distinguish that case.
Manufacturing In U.S. Unexpectedly Contracted In June
By Shobhana Chandra - Bloomberg.com
Manufacturing in the U.S. unexpectedly shrank in June for the first time since the economy emerged from the recession three years ago, indicating a mainstay of the expansion may be faltering.
The Institute for Supply Management's index fell to 49.7, worse than the most-pessimistic forecast in a Bloomberg News survey, from 53.5 in May, the Tempe, Arizona-based group's report showed today. Figures less than 50 signal contraction. Measures of orders, production and export demand dropped to three-year lows.
The Only Advanced Country
Without a National Vacation Policy? It's the U.S.
By Derek Thompson - TheAtlantic.com
There's no wrong way to celebrate American exceptionalism, but this might not be the best candidate for cheering this July 4th Week: The United States is practically the only developed country in the world that doesn't require companies to give their workers time off. In Germany, workers are guaranteed a month. In the UK, they're guaranteed more than five weeks of paid vacation. In the U.S., unique in its class, there is no such guarantee. There's your American exceptionalism:
Lobster in Maine now cheaper than bologna
Abundant catches lead to low prices
By Clarke Canfield - AP - WashingtonTimes.com
PORTLAND, Maine — A glut has driven down lobster prices in Maine - bringing cheer to lobster-loving consumers at the start of the state's tourist season but gloom among lobstermen.
Retailers have been selling small soft-shell lobsters in the Portland area for an unusually low $3.79 to $4.99 a pound. At those prices, lobsters have been selling for less than the per-pound price of bologna at many supermarket deli counters.
They Are Turning Our Crops, Animals And Even Our Babies Into Freakish Genetic Monsters - What Could Go Wrong?
By Michael Snyder - EndOfTheAmericanDream.com
The greatest environmental threat that we are facing is genetic modification. All over the globe, scientists are treating the fabric of life as if it was a playground where anything goes. Behind closed doors, scientists all over the planet are creating some of the most freakish and most bizarre monsters that you could possible imagine, and very few people seem concerned about it. But the truth is that messing with the building blocks of life is going to have some very serious consequences. Scientists claim that they are making our crops stronger, more productive and less vulnerable to insects. Scientists claim that they can alter our animals so that they are more "useful" to us. Scientists claim that genetic modification is only going to "enhance" humanity. But what if something goes seriously wrong? For example, what if we learn that eating genetically modified food is really, really bad for us? Well, at this point more than 70 percent of the processed foods sold in the United States contain at least one ingredient that has been genetically modified. It would be kind of hard to go back now. We have rushed ahead and have created hordes of freakish genetic monsters without ever seriously considering the consequences. Someday, future generations may look back on us and wonder how we could have ever been so incredibly foolish.
Facebook email mess spreads to mobile phones
By Julianne Pepitone @CNNMoneyTech
NEW YORK (CNNMoney) -- Facebook already annoyed its users by automatically posting their @facebook.com addresses to profiles and displaying them as the default. Now the problem has spread to some users' mobile phones.
A handful of CNNMoney readers wrote in last week after news of email@example.com email "update" to complain about problems with phone contacts that are synced to Facebook accounts.
After several news reports, Facebook confirmed on Monday that the problem is real. The company says it was caused by a bug in the contact-sync system for some phones.
Apple closes MobileMe,
reminds iWork.com users end is nigh
By Salvador Rodriguez - LATimes.com
A report says Apple shut down its MobileMe service Sunday, and on Monday, the company reminded iWork.com users that the end of their service is next.
The two moves are part of an effort to steer users toward using iCloud, a cloud-computing service Apple launched last year at its Worldwide Developers Conference similar to the two services Apple is ending.
MobileMe launched in early January 2000 under the name iTools, and since then, it underwent several brand-name changes until finally being named MobileMe in 2008 in a relaunch alongside theiPhone 3G, the second version of Apple's mobile operating system and the iPhone App Store.
The Inside Story of the Extra Second That Crashed the Web
By Robert McMillan and Cade Metz - Wired.com
When Saturday night's leap second glitch hit Reddit, Jason Harvey didn't realize it was the leap second glitch. He thought it was some sort of internet slowdown related to the massive Amazon cloud outagethat brought down some of the web's most popular services less than 24 hours earlier.
"It looked like the network was just moving really poorly," says Harvey, one of the system administrators who oversee the operation of Reddit, the popular news aggregation and discussion site. "With Amazon going down, a network problem just made sense."
Twitter Loses 'Occupy Wall Street' Case,
Forced To Hand Over User Info
by CARL FRANZEN - TalkingPointsMemo.com
Twitter lost a landmark court case on Monday after a New York judge ruled against the company's attempt to avoid handing over information of one of its users, an "Occupy Wall Street" protester, to the Manhattan District Attorney.
"We are disappointed in the judge's decision and are considering our options," a Twitter spokesperson told TPM in a statement.
Twitter Reports 679 US Government User Information Requests In The First Half Of 2012, Folding On 75% Of Them
Submitted by Tyler Durden - ZeroHedge.com
In the first of its kind action, Twitter has unveiled its first Twitter Transparency Report, in which it says that as "inspired by the great work done by our peers @Google, the primary goal of this report is to shed more light on: government requests received for user information, government requests received to withhold content, and DMCA takedown notices received from copyright holders." Is it something Americans should be concerned about? Well, with 679 out of a total of 849 user information requests by various governments, or the most by a margin of nearly 700% belonging to the US, we would say so. This also translates into 948 of all users/accounts specified. But most troubling is that Twitter has folded on a 75% of all such demands when it comes to the US government demanding information. It has provided information to only 6 other governments: Australia, Canada, Greece, Japan, Netherlands and the UK, but at a far lower "hit rate." You gotta give it to Uncle Sam: he sure can be persuasive.
If One Storm Can Turn D.C. Dark For Several Days,
What Would A Massive EMP Burst Do?
By Michael Snyder - TheEconomicCollapseBlog.com
Sometimes we all get a little reminder of just how completely and totally dependent we are on the power grid. Massive thunderstorms that ripped through Ohio, West Virginia, Maryland, Washington D.C. and Virginia left millions without power over the weekend. At this point it is being projected that some people may not get power back until the end of the week. The "super derecho" storm that pounded the Washington D.C. area on Friday night with hurricane-force winds is being called unprecedented. But the truth is that there are other events that could happen that would be far more damaging to our power grid. For example, a substantial EMP burst over a major U.S. city would fry virtually all of the electronics in the city and take the power grid in the area down indefinitely. A gigantic EMP burst over the entire country (caused by a massive solar storm or a very large nuclear explosion high in the atmosphere) could theoretically take down the entire national power grid. Just try to imagine a world where nobody has any electricity, nobody can pump gas, nobody can use their credit cards or get any more money, where most vehicles won't start, where nobody has the Internet, where all cell phones are dead and where nobody can heat or cool their homes. That is how serious an EMP burst could potentially be. We are talking about an event that could be millions of times worse than 9/11.
10 sobering realizations the Eastern U.S. power grid failure
is teaching us about a real collapse
by Mike Adams, the Health Ranger - NaturalNews.com
(NaturalNews) In the wake of violent storms, the power remains out today for millions of Americans across several U.S. states. Governors of Virginia, West Virginia and Ohio have declared a state of emergency. Over a dozen people are now confirmed dead, and millions are sweltering in blistering temperatures while having no air conditioning or refrigeration. As their frozen foods melt into processed goo, they're waking up to a few lessons that we would all be wise to remember.
Obama's amnesty edict set in motion
Deportations already halted
By Stephen Dinan-The Washington Times
Federal immigration authorities have begun granting tentative legal status to illegal immigrants under President Obama's deportation halt — and in some cases are even ignoring the administration's eligibility rules to stop deportations for those who shouldn't qualify, according to the chairman of the House Judiciary Committee.
Rep. Lamar Smith, Texas Republican, said he's learned some illegal immigrants who have been in the U.S. less than five years have had their deportations canceled, even though Mr. Obama and Homeland Security Secretary Janet A. Napolitano had listed the five-year mark as one of their criteria.
Airbus to build 1st U.S. assembly plant in Alabama
By Melissa Nelson-Gabriel - AP - WashingtonTimes.com
MOBILE, Ala. — In the battle to dominate the global aviation industry, European aerospace giant Airbus announced its first assembly plant in the United States on Monday, a symbolic and significant step in the competition with archrival Boeing.
The French-based company said the Alabama plant is expected to cost $600 million to build and will employ 1,000 people when it reaches full production, likely to be four planes a month by 2017.
UN agrees to new Syria plan
BY NIKOLAJ NIELSEN - EUObserver.com
BRUSSELS - Foreign ministers, including China and Russia, agreed Saturday (30 June) in Geneva to a new United Nations peace plan that calls upon the immediate cessation of violence in Syria and for "clear and irreversible steps" towards a transitional government.
The internationally-backed UN plan made no specific reference to the stepping down of Syria's President Bashar al-Assad. The new transitional government, notes the UN document, would instead include by "mutual consent" members of the present government and the opposition.
Dragging America Into Turkey's War with Syria?
Once again NATO demonstrates
just how outmoded it has become.
By DOUG BANDOW - The American Spectator.org
What is NATO for? It was created to protect Europe from the Red Army. However, the Soviet Union has disappeared. The Warsaw Pact has dissolved. The Europeans have ten times the GDP and three times the population of Russia.
Why are Americans still defending their prosperous and populous allies?
If NATO was merely a social club, it wouldn't be so bad -- though the dues remain a bit high. But the organization has become a transmission belt of needless war. Washington dragged reluctant Europeans into a decade-long nation-building crusade in Afghanistan. Paris and London dragged reluctant Americans into a foolish attempt at regime change on the cheap in Libya. In both cases everyone would have been better off had everyone remained at peace.
Diplomacy failing, West faces tough Syria choices
By Peter Apps, Political Risk Correspondent
LONDON | Mon Jul 2, 2012 5:12pm EDT
(Reuters) - There are few signs diplomacy can stem Syria's worsening conflict, leaving Western leaders - and even more so their Arab and Turkish allies - pushed ever further towards backing Bashar al-Assad's ouster by force.
In Geneva on Saturday, world powers attempted a vague show of unity by committing to support for a transitional government. But diplomats led by United Nations envoy Kofi Annan failed to bridge differences between the West and Russia - backed by China - on whether or not that meant that Syria's president must go.
Syria strikes Damascus suburb; U.N. decries arms flow
By Mariam Karouny
BEIRUT | Mon Jul 2, 2012 5:12pm EDT
(Reuters) - Syrian helicopters bombarded a Damascus suburb on Monday and Turkey scrambled warplanes near the border in the north, as the U.N. human rights chief warned that arms supplies to both the government and rebels were deepening the 16-month conflict.
Fighting has come to the gates of the capital in recent weeks and is also raging throughout the country as the battle to unseat President Bashar al-Assad increasingly takes on the character of an all-out civil war, fuelled by sectarian hatred.
Iranian authorities acknowledge impact of sanctions
By Jason Rezaian - WashingtonPost.com
With downgraded nuclear talks with world powers set to begin Tuesday, there are growing signs in Iran that Western sanctions are hurting the nation's economy and alarming its decision-makers.
Authorities remain defiant, but they increasingly are acknowledging publicly the economic pressures that Iran is facing.
Their proposed responses range from military confrontation — including renewedthreats to block the strategic Strait of Hormuz — to economic countermeasures. The reaction illustrates the range of voices vying for influence at a particularly tense period in the Islamic republic's history.
Iran threatens Israel; new EU sanctions take force
By Yeganeh Torbati
DUBAI | Sun Jul 1, 2012 2:58pm EDT
(Reuters) - Iran announced missile tests on Sunday and threatened to wipe Israel "off the face of the earth" if the Jewish state attacked it, brandishing some of its starkest threats on the day Europe began enforcing an oil embargo and harsh new sanctions.
The European sanctions - including a ban on imports of Iranian oil by EU states and measures that make it difficult for other countries to trade with Iran - were enacted earlier this year but mainly came into effect on July 1.
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