Category Archives: Politics

Contrasting styles: Emanuel vs. Daley in with whom they meet and consult

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The Chicago Reader has an interesting piece looking at who Mayor Rahm Emanuel meets with – and how this differs from Mayor Richard M. Daley’s approach:

In many ways, Emanuel’s schedule strikingly contrasts with his predecessor’s. Richard M. Daley is a Chicago guy, born and raised. Except for his college years in Providence, Rhode Island, he’s stayed here all of his life. And it shows in the people who had his ear: in addition to pols and big-shot business leaders, his meeting schedule was packed with the ministers of small churches, local school leaders, and owners of neighborhood businesses like the local sausage shop (see “Daley’s A-List”).

Emanuel, on the other hand, grew up in the north suburbs, went to college in New York, and spent the better part of the last two decades in Washington, first as an aide in the Clinton White House, then as a congressman, and finally, for almost two years, as Obama’s chief of staff.

Much of his mayoral schedule is taken up by meetings and calls with wealthy out-of-towners, many of whom have donated to his campaign. Indeed, it seems Emanuel has learned from his mentor, President Clinton. Under Clinton, the White House was open to big donors who got to spend the night in the Lincoln bedroom. In Emanuel’s case, he either invites them into his City Hall office or makes time to hang out at one of his favorite haunts…

Some days, Emanuel meets with more multimillionaires within an afternoon than most of us will cross paths with during our entire lives. On June 30, for example, after the mayor spent 30 minutes in his City Hall office with U.S. Treasury secretary Timothy Geithner, he took 15 minutes to meet with Marc Lasry, the billionaire CEO of Avenue Capital Group, a hedge fund operation. That was followed by 45 minutes with Stephen Ross, a New York-based real estate mogul and owner of the Miami Dolphins.

There could be two ways to view this:

1. This is good for Chicago. Due to Emanuel’s connections outside of Chicago, the city will benefit. The new mayor may spend a lot of time with out of town millionaires but these people could bring money and jobs into Chicago through this connection.

2. This is bad for Chicago. Emanuel is less involved with the “little people” of Chicago that are important for getting things done and working the patronage machine. Emanuel is more of a corporate mayor (having less time for local leaders) while Daley at least mingled with the commoners and neighborhood leaders knew they could meet with him at certain points.

I wonder how much of this should be chalked up to different styles of leadership, personal history, or simply a shift in what it means to be a politician today where Daley was following the example of his father while Emanuel is operating under the idea that politicians and businesses need to work together (perhaps the Bill Clinton model?).

President Obama vs. Mitt Romney on dealing with housing crisis

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Even though President Obama and Mitt Romney are not officially running against each other yet, they have presented contrasting plans to deal with the housing crisis. Yesterday, President Obama offered a new “revamped refinancing program” that would help 1 to 1.5 million homeowners:

Under Obama’s proposal, homeowners who are still current on their mortgages would be able to refinance no matter how much their home value has dropped below what they still owe…

At the same time, Obama acknowledged that his latest proposal will not do all that’s not needed to get the housing market back on its feet. “Given the magnitude of the housing bubble, and the huge inventory of unsold homes in places like Nevada, it will take time to solve these challenges,” he said…

Presidential spokesman Jay Carney criticized Republican presidential candidate Mitt Romney for proposing last week while in Las Vegas that the government not interfere with foreclosures. “Don’t try to stop the foreclosure process,” Romney told the Las Vegas Review-Journal. “Let it run its course and hit the bottom.”

“That is not a solution,” Carney told reporters on Air Force One. He said Romney would tell homeowners, “‘You’re on your own, tough luck.'”

How much of these proposals is about looking for votes versus actually seeking out a plan that will help ease dropping home values, foreclosures, and a housing glut?

At the same time, the Washington Post reports that government efforts in recent years haven’t helped much:

President Obama pledged at the beginning of his term to boost the nation’s crippled housing market and help as many as 9 million homeowners avoid losing their homes to foreclosure.

Nearly three years later, it hasn’t worked out. Obama has spent just $2.4 billion of the $50 billion he promised. The initiatives he announced have helped 1.7 million people. Housing prices remain near a crisis low. Millions of people are deeply indebted, owing more than their properties are worth, and many have lost their homes to foreclosure or are likely to do so. Economists increasingly say that, as a result, Americans are too scared to spend money, depriving the economy of its traditional engine of growth.

The Obama effort fell short in part because the president and his senior advisers, after a series of internal debates, decided against more dramatic actions to help homeowners, worried that they would pose risks for taxpayers and the economy, according to numerous current and former officials. They consistently unveiled programs that underperformed, did little to reduce mortgage debts owed by ordinary Americans and rejected a get-tough approach with banks.

Too risky meaning that it was politically untenable when more people are concerned with risk and deficits?

The conversation about housing could play an interesting role in the 2012 elections as both parties look to claim the mantle of defenders of the American middle-class dream of homeownership.

Occupy Wall Street in Naperville

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National coverage of the Occupy Wall Street groups has emphasized the city gatherings. But Occupy Wall Street has even made it to conservative Naperville:

About 50 people joined the event, forming a group just slightly larger than the one gathered outside a nearby Apple Store, for demonstrations modeled after the Occupy Wall Street encampment that began last month in lower Manhattan.

Organizers said they will return each Saturday from 10 a.m. to noon until their demands are met. It’s a list that includes increased regulation of banks, rollbacks on the rights of corporations and forgiveness for student loans…

“Well, there’s at least a couple dozen people over there, and there’s what? Maybe (140,000) people here in town? I’d say that’s probably an accurate representation” of support for the demonstrators’ agenda, said Eloe, grinning.

Alesch began planning the event last week with a few friends at a Wheaton coffee shop after hearing about an Occupy Aurora demonstration.

This reminds me of research I’ve seen regarding the diffusion of riots in the 1960s. How widespread are the Occupy Wall Street protests? Is it unusual to find one in a suburb like Naperville that has over 140,000 residents? Are suburbanites more or less likely to support the movement?

If this group continues to protest in Naperville, it will be interesting to see how onlookers and the community responds. An Occupy Aurora protest might make more sense since Aurora is more diverse and less wealthy. But would a continuing protest in Naperville draw more attention?

The Beatles on immigration in “Get Back”

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One discussion topic among The Beatles during the late 1960s would have some bearing on current discussions: immigration. Their hit single (#1 in both the US and Britain) “Get Back” was originally about immigration though lyric changes obscure the initial message.

Here is what the Wikipedia entry on the song “Get Back” has to say:

“Get Back” is unusual in the Beatles’ canon in that almost every moment of the song’s evolution has been extensively documented, from its beginning as an offhand riff to its final mixing in several versions. Much of this documentation is in the form of illegal (but widely available) bootleg recordings, and is recounted in the book Get Back: The Unauthorized Chronicle of the Beatles’ Let It Be Disaster by Doug Sulpy and Ray Schweighardt…

Around the time he was developing the lyrics to “Get Back”, McCartney satirised the “Rivers of Blood speech” by former British Cabinet minister Enoch Powell in a brief jam that has become known as the “Commonwealth Song”. The lyrics included a line “You’d better get back to your Commonwealth homes”. The group improvised various temporary lyrics for “Get Back” leading to what has become known in Beatles’ folklore as the “No Pakistanis” version.This version is more racially charged, and addresses attitudes toward immigrants in America and Britain: “…don’t need no Puerto Ricans living in the USA”; and “don’t dig no Pakistanis taking all the people’s jobs”. In an interview in Playboy magazine in 1980, Lennon described it as “…a better version of ‘Lady Madonna’. You know, a potboiler rewrite.”

On 23 January, the group (now in Apple Studios)[ tried to record the song properly; bootleg recordings preserve a conversation between McCartney and Harrison between takes discussing the song, and McCartney explaining the original “protest song” concept. The recording captures the group deciding to drop the third verse largely because McCartney does not feel the verse is of high enough quality, although he likes the scanning of the word “Pakistani”. Here the song solidifies in its two-verse, three-solo format.

Watch and listen to the never-released song, “Commonwealth,” here:

Last weekend, when I wasn’t delivering meals to the homebound, I was “researching” Beatles bootlegs. And I discovered the so-called “Commonwealth Song.” It’s not so much a song as it is an extended improvisation during the interminable “Get Back” studio sessions in 1969 (in fact, some theorize that “The Commonwealth Song” is a prototype for “Get Back”). “Commonwealth” name-checks Enoch Powell (the Tom Tancredo of his day, or Thilo Sarazin, if you prefer a German reference), who had delivered his anti-immigrant “Rivers of Blood” speech the previous year. “Commonwealth” was Paul McCartney’s mocking response. All of which shows that the sun never sets on some issues. It’s also nice to know that as late as 1969, Lennon and McCartney could still crack each other up, especially when John interjects his high-pitched “Yes!”

But the Beatles were not in support of Enoch Powell or anti-immigration policies – they were trying to satirize the debate:

The most infamous of the unreleased Get Back versions is known as No Pakistanis, and contained the line “Don’t dig no Pakistanis taking all the people’s jobs”. While mostly unfinished, the song did include a mumbled rhyming couplet which paired the words ‘Puerto Rican’ with ‘mohican’.

Various demo versions of this early version were recorded, one of which contains the following lines:

Meanwhile back at home too many Pakistanis
Living in a council flat
Candidate Macmillan, tell us what your plan is
Won’t you tell us where you’re at?

Despite being satirical in nature, it didn’t prevent accusations of racism being levelled at McCartney for years to come, after the Get Back bootlegs became public.

When we were doing Let It Be, there were a couple of verses to Get Back which were actually not racist at all – they were anti-racist. There were a lot of stories in the newspapers then about Pakistanis crowding out flats – you know, living 16 to a room or whatever. So in one of the verses of Get Back, which we were making up on the set of Let It Be, one of the outtakes has something about ‘too many Pakistanis living in a council flat’ – that’s the line. Which to me was actually talking out against overcrowding for Pakistanis… If there was any group that was not racist, it was the Beatles. I mean, all our favourite people were always black. We were kind of the first people to open international eyes, in a way, to Motown.
Paul McCartney
Rolling Stone, 1986

Today, could a popular musical act speak openly about controversial issues or would they, like the Beatles, have to tone down some of their lyrics and ideas in order to not be misunderstood by the mass market? If the Beatles were opposed to immigration, would people have different opinions about them or does the quality of their music overshadow some of their political leanings? And how many Beatles fans had any idea of what “Get Back” was actually about?

Why paying off all of the American debt in the early 2000s might have caused problems

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Many people would suggest that the United States needs to tackle its growing debt problem. But a government report from the early 2000s suggests that paying off all the debt could have some negative consequences:

If the U.S. paid off its debt there would be no more U.S. Treasury bonds in the world…

But the U.S. has been issuing bonds for so long, and the bonds are seen as so safe, that much of the world has come to depend on them. The U.S. Treasury bond is a pillar of the global economy.

Banks buy hundreds of billions of dollars’ worth, because they’re a safe place to park money.

Mortgage rates are tied to the interest rate on U.S. treasury bonds.

The Federal Reserve — our central bank — buys and sells Treasury bonds all the time, in an effort to keep the economy on track.

If Treasury bonds disappeared, would the world unravel? Would it adjust somehow?

“I probably thought about this piece easily 16 hours a day, and it took me a long time to even start writing it,” says Jason Seligman, the economist who wrote most of the report…

In the end, Seligman concluded it was a good idea to pay down the debt — but not to pay it off entirely.

So which party or movement would support this? Would it be best to have a more flexible debt (small to large depending on the more immediate economic circumstances) or would it be better to have a more stable, small amount of debt?

I don’t know the intricacies of how this might all play out but it is a reminder of the globalization of finance: doing something that might be viewed as desirable in the United States would not only affect other sectors of American life but how other countries can operate. It would be interesting to know how we got to this point. Does every major country basically have some debt that other countries are counting on?

Senate proposal to reward immigrants who would buy $500k in housing

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The down housing market is leading to some interesting ideas including one from two Senators which involves rewarding immigrants who are willing to buy expensive homes:

The reeling housing market has come to this: To shore it up, two Senators are preparing to introduce a bipartisan bill Thursday that would give residence visas to foreigners who spend at least $500,000 to buy houses in the U.S.

The provision is part of a larger package of immigration measures, co-authored by Sens. Charles Schumer (D., N.Y.) and Mike Lee (R., Utah), designed to spur more foreign investment in the U.S.

Foreigners have accounted for a growing share of home purchases in South Florida, Southern California, Arizona and other hard-hit markets. Chinese and Canadian buyers, among others, are taking advantage not only of big declines in U.S. home prices and reduced competition from Americans but also of favorable foreign exchange rates.

To fuel this demand, the proposed measure would offer visas to any foreigner making a cash investment of at least $500,000 on residential real-estate—a single-family house, condo or townhouse. Applicants can spend the entire amount on one house or spend as little as $250,000 on a residence and invest the rest in other residential real estate, which can be rented out…

International buyers accounted for around $82 billion in U.S. residential real-estate sales for the year ending in March, up from $66 billion during the previous year period, according to data from the National Association of Realtors. Foreign buyers accounted for at least 5.5% of all home sales in Miami and 4.3% of Phoenix home sales during the month of July, according to MDA DataQuick.

This seems like it would be part of a discernible shift in the immigration conversation: primarily letting rich or educated immigrants into the United States.

The real question: does this really help the housing market? What kind of impact are we talking about – a 1% boost, 10% boost? As the article suggests, wealthy foreigners are already buying property in other countries. I’ve highlighted a couple of stories where wealthy Chinese buyers have purchased homes in New Zealand and Vancouver, Canada. When this happens, locals have mixed reactions. Would this proposed policy simply promote more foreign investment or would it push people to actually move to the United States and work here?

Would this bill also only help more wealthy areas, such as big cities or coastal/vacation regions? Would this primarily benefit people with bigger, more expensive homes?

Conservatives getting behind mortgage modifications?

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A journalist argues that conservatives are starting to argue that the federal government should step in and help homeowners stay in their homes:

Mortgage modifications have been a key pillar of the progressive response to the economic downturn–and they’ve been one focus of the Occupy protests that have sprung up across the country lately. The Obama administration offered its own such program in 2009, though it has helped far fewer homeowners than anticipated, thanks to a flawed design. But until lately, conservatives had by and large opposed the idea, arguing, as Santelli did, that taxpayers shouldn’t be forced to pay for borrowers’ bad decisions, and that banks shouldn’t have their actions constrained by government.

So what’s changed? By and large, policy hands and political leaders alike recognize that the economy isn’t going to get better on its own, at least not any time soon,. There’s a widespread consensus that until the United States tackles the massive overhang of housing debt–American homeowners’ wealth has fallen by a stunning 40 percent since 2006–the economic recovery won’t gain steam. As Feldstein wrote: “The fall in house prices is not just a decline in wealth but a decline that depresses consumer spending, making the economy weaker and the loss of jobs much greater.” Rogoff, too, views the crushing volume of personal debt as an unaffordable drag on growth. “Simply put, you can’t operate an economy where huge numbers of people are desperately in debt and have no real way out,” he argues.

Hubbard originally offered a modification plan in 2010 as a way to avoid another “costly stimulus package” designed to spur consumer demand. But he, too, may also recognize that mortgage modification, though necessary for the health of the economy, is likely to be politically unpopular. If so, better to have President Obama take the hit, rather than a future Republican president—like, say, President Romney.

Of course, right and left don’t see entirely eye-to-eye on the issue. Dean Baker, an economist with the liberal Center for Economic and Policy Research, last week slammed Feldstein’s plan as too soft on banks and a bad deal for struggling homeowners. And it’s hard to imagine that Republicans in Congress would react favorably to an aggressive mortgage modification proposal from the Obama administration.

So if this is true – and “three instances” doesn’t a trend make even as this journalist suggests – what is happening?

1. Conservatives are recognizing that the mortgage debt is holding up the larger economic recovery. If people can’t move, they can’t go to the open jobs. The debt doesn’t allow them to spend on other consumer items. If government involvement can move people past this logjam, then the “free market” can work again. Desperate times mean that political ideology has to be bent a little.

2. As the journalist suggests, they only back this when a Democrat is in charge.

3. This is pandering for votes. American culture has a dream of homeownership – neither party wants to be against that.

This bears watching. Of course, the devil is in the details: who is actually going to support what? Who is going to pay for this? How many homeowners could be helped?

Lord Giddens as “Blair guru”

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I occasionally run across stories involving Anthony Giddens, well-known sociologist, speaking about political issues in Britain. Here is another example of the actions of the “Blair guru”:

Labour peer Lord Giddens, who brought the debate on 13 October entitled Universities: Impact of Government Policy, said ministers appeared to be pursuing policies of “ill-considered, untutored radicalism” that were not based in proper research and had “imponderable outcomes”.

The academic, who advised former prime minister Tony Blair and is professor of sociology at LSE, said the reforms would leave England as a “global outrider” with one of the lowest levels of public support for higher education in the industrialised world.

He said the “ideological thrust” of the Browne Review should have been rejected and instead tuition fees only gradually raised alongside the maintenance of direct public support for universities, due to their “massive” beneficial impact on society.

“Universities are not a sort of supermarket where education can be chosen like a washing powder off the shelf. Students are not simply consumers, making day-to-day purchasing decisions. They will make a one-off decision,” he said.

Reading these stories, it seems like Giddens has more political clout than most sociologists. Is this simply a function of having been close to Tony Blair, did Giddens do specific work/research that put him in contact with politicians, or does Britain simply have a different culture regarding public intellectuals and how sociologists can be involved in social and government life?

Knowing when to fold ’em

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The Washington Post had a fascinating article yesterday about how banks are responding to one city’s foreclosure crisis:

Cleveland — The sight of excavators tearing down vacant buildings has become common in this foreclosure-ravaged city, where the housing crisis hit early and hard. But the story behind the recent wave of demolitions is novel — and cities around the country are taking notice. A handful of the nation’s largest banks have begun giving away scores of properties that are abandoned or otherwise at risk of languishing indefinitely and further dragging down already depressed neighborhoods.

This closely mirrors the approach that Youngstown, another Ohio city, has taken to their dwindling population:

Even when the result is an empty lot, it can be one less pockmark. While some widespread demolitions could risk hollowing out the urban core of struggling cities such as Cleveland, advocates say that the homes being targeted are already unsalvageable and that the bulldozers are merely “burying the dead.”

However, unlike in Youngstown where that city is simply trying to shrink to a manageable size, the Cleveland demolitions are already leading to redevelopment:

The demolitions in some cases have paved the way for community gardens, church additions and parking lots.

For good or ill, this looks to be a growing trend for some time. The article notes that New York, Philadelphia, Georgia, and others have or soon will pass laws similar to the ones Cleveland used to authorize its land bank and teardowns. Unfortunately, there doesn’t seem to be any shortage of foreclosed property candidates:

At the end of August, the nation’s banks, along with Fannie Mae and Freddie Mac, had an inventory of more than 816,000 foreclosed properties on their books waiting for a buyer, according to RealtyTrac. An additional 800,000 are working their way through the foreclosure process.

H/t to the ABA Journal for the original link pointing me to the Post article.

Movie stars: the political comments you make before your movie releases will affect who will see the film

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Last November, The Hollywood Reporter reported that Republicans and Democrats like different primetime television shows. A new survey now shows that political affiliation of the viewer affects how much the political views of major movie actors influences movie-going behavior:

With Dolphin Tale opening with a strong $19.2 million that first weekend and finishing No. 1 with $13.9 million in its second, the financial impact of Freeman’s comments is hard to quantify. But they did have an effect. In a far-ranging poll Penn Schoen Berland conducted for The Hollywood Reporter of 1,000 registered voters to gauge moviegoing tendencies of Democrats vs. Republicans, it’s clear political allegiances have shifted entertainment viewing habits. Jon Penn, the firm’s president of media and entertainment research, says that before Freeman’s words, interest in Dolphin Tale was considerably higher among conservatives and religious moviegoers than among liberals. After the remarks, 34 percent of the conservatives who were aware of them, and 37 percent of Tea Partiers, said they were less likely to see the film — but 42 percent of liberals said they were more likely. (Five days after Freeman’s remarks, 24 percent of all moviegoers were aware of them.)

In fact, overall, 35 percent of Republicans and 45 percent of Tea Partiers consider a celebrity’s political position before paying to see their films, compared with 20 percent of Democrats.

Many exhibitors say privately that they cringe when a star waxes politically just before one of their movies opens — like when, seven weeks before Contagion, Matt Damon attended a Save Our Schools march where some attendees compared Republicans to “terrorists.” Videos of Damon mocking conservatives for their fiscal policies spread like wildfire on the Internet.

I suppose we shouldn’t be too surprised at this information since we hear all the time about our overly partisan public sphere.

If this is true, should movie actors muzzle themselves and avoid sharing their political opinions? Why do movie actors often share this information while sports stars are more demure about this topic?

It would be interesting to know exactly why Republicans let these political actions and views affect them. Has this always been the case? Is this due to the commonly heard idea that Hollywood is a liberal place pushing liberal ideas? Do most Republicans think Hollywood puts out “enough” family-friendly or conservative-friendly films – do they really want to go to the movies more and the content is simply lacking? What are the movies most loved by Republicans and Democrats? (The article suggests people of both parties “say comedy is their favorite genre, popcorn is their favorite theater snack, Forrest Gump is their preferred blockbuster and Indiana Jones is their favorite action hero.” Now that’s bi-partisanship!)