Posts Tagged ‘NPR’

Dodd-Frank Bill Collides Head On With Deficit Realities

Wednesday, February 9th, 2011

Implementation of the historic Dodd-Frank bill – which President Barack Obama signed into law last July to regulate Wall Street against the excesses that led to the Great Recession — is in danger of being gutted if Republicans’ proposed deep spending cuts become a reality.  Representative Barney Frank (D-MA) pointedly criticized Republicans’ proposal to slash government spending to 2008 levels. According to Frank, that is not an option because the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) need funding to hire hundreds of employees to write and issue regulations to give the new law teeth.  Frank co-sponsored the bill with former Senator Christopher Dodd (D-CT).

Unfortunately, the positive things that Dodd-Frank was designed to accomplish have run head on into the non-partisan Congressional Budget Office’s (CBO) bleak warning about the direction of the nation’s debt.  According to NPR  Planet Money correspondent David Welna, “It was not a pretty picture that CBO director Douglas Elmendorf painted as he sat before the budget committee”. This year’s deficit, he said, will be nearly $1.5 trillion dollars, nominally the largest in history.  And if the tax breaks that got extended this year continue throughout the next decade, Elmendorf said the nation’s debt would grow to be the size of its economy, something that hasn’t happened since the end of World War II.  The time to do something about it, he told the grim-faced panel of senators, is now.”

Elmendorf warned that “The longer the necessary adjustments are delayed, the greater will be the negative consequences of the mounting debt, the more uncertain individuals and businesses will be about the future government policies, and the more drastic the ultimate policy changes will need to be.”  Senator Kent Conrad (D-ND), chairman of the Senate Budget Committee, said “The thing that makes the most sense is there is a summit between the White House, leaders in the House and the Senate, because at the end of the day, the White House has got to be at the table. And unfortunately, during the budget process, the president is left out.”  NPR’s Welna continues, “The revenue side of the equation, of course, is taxes and raising them has been a taboo topic for most in the GOP.  But the likely need for more revenues was underscored toward the end of today’s hearing when Conrad noted that the Social Security surplus that lawmakers have been raiding for years disappeared this year and instead, Social Security has started cashing in its IOUs with the Treasury.”  Social Security will post nearly $600 billion in deficits over the next 10 years as the economy recovers and millions of baby boomers begin retiring, according to new congressional projections.

House Republicans, led by Representative Scott Garrett (R-NJ), chairman of the House Financial Services Subcommittee on Capital Markets and Government-Sponsored Enterprises, wants to cut $55 to $60 billion in non-defense spending during fiscal year 2011.  “A dramatic spending increase to fund the SEC and CFTC, as envisioned by the authors of the Dodd-Frank legislation, would further the mindset that our nation’s problems can be solved with more spending, not more efficiency,” according to Garrett.  Frank countered that Garrett’s comments only reinforce his “fear that Republicans are attempting to cripple regulation by failing to fund it.  I had thought even among people in the Tea Party that credit default swaps were not that popular.  We’re arguing the security of the average American was far more endangered by the financial crisis than by a lot of other things that our military does.”

If the cuts are put into place, the SEC and CFTC would be frustrated in their mandates, such as setting up a new office of municipal securities, according to Frank.  The Republican response to Democratic concerns is that their goal is to make federal regulators more efficient.  Representative Spencer Bachus (R-AL), chairman of the House Financial Services Committee, said “Past experience indicates that a few investigative reporters have been more effective than the many employees at the SEC in addressing and exposing financial wrongdoing.”

Legendary Political Commentator Dan Schorr Dies at Age 93

Tuesday, August 10th, 2010

The radio airwaves lose a commanding presence with the passing of legendary broadcaster Dan Schorr.  Legendary newscaster and elder statesman of political commentary Daniel Schorr died recently at age 93 following a brief illness.  Schorr, who spent the last 25 years of his long career as a senior news analyst with National Public Radio (NPR), aired his final broadcast on Saturday, July 10.  A journalist for more than 60 years, Schorr was the last active member of Edward R. Murrow’s “Boys”, a group of journalists who worked at CBS News in the 1940s and 1950s.  He joined NPR in 1985 and gave regular commentaries on the “Weekend Edition” and “Week in Review” programs.

Scott Simon, host of “Weekend Edition”, said “Nobody else in broadcast journalism – or perhaps in any field – had as much experience and wisdom” as Schorr.  “I’m just glad that, after being known for so many years as a tough and uncompromising journalist, NPR listeners also got to know the Dan Schorr that was playful, funny and kind.  In a business that’s known for burning out people, Dan Schorr shined for nearly a century.”

Schorr was famous for his straightforward coverage of the Watergate scandal of the early 1970s and even discovered his name on President Richard Nixon’s infamous “enemies” list.  “He lived through so many years of history, and he put that to the service of his commentaries,” said Geoffrey Cowan, dean emeritus of the University of Southern California’s Annenberg School for Communication.  “He never lost his edge.  He was also outspoken and independent.”

In 1975, New York magazine called Schorr the “great abrasive” for his pointed coverage of the House Intelligence Committee hearings on covert CIA operations, including assassination plots.  Schorr had been given a copy of the intelligence committee’s draft report and reported some of the contents on the CBS Sunday News – the only journalist to do so.  When CBS refused to back Schorr, he offered the full report to the Village Voice, which published a 24-page special section headlined “The Report on the CIA that President Ford Doesn’t Want You to Read.”  The bold move prompted CBS to demand that Schorr resign, giving him time to write the book “Clearing the Air” before he was hired by a very new 24-hour broadcast operation called CNN.

When Schorr was approaching age 70, NPR asked him to become a commentator, a post that he held until his death.  Schorr says that NPR “accorded some of the respect of an elder statesman” and he became renowned for putting current events into historical context.

“The Giant Pool of Money”

Thursday, May 21st, 2009

$70 trillion dollars.  That’s all the money in the world, or to get technical, the subset of global dollarsavings known as fixed-income securities.  And it almost doubled from $36 trillion in just six years.  How did this happen?

The Federal Reserve presided over the creation of what we have learned (the hard way) is a monster of unregulated investment vehicles run amok, resulting in the global credit crisis.

In the words of National Public Radio’s international business reporter Adam Davidson, “What he (former Federal Reserve Chairman Alan Greenspan) is saying is he’s going to keep the Fed Funds rate at the absurdly low level of one percent.  It tells every investor in the world:  you are not going to make any money at all on U.S. treasury bonds for a very long time.  Go somewhere else.  We can’t help you.  And so the global pool of money looked around for some low-risk, high-return investment.  And among the many things they put their money into, there was one thing they fell in love with.”

Investment companies fell in love with securitizing mortgages, bundling them into enormous pools – in some cases, pools of as many as 16 million loans — and selling them in shares to investors.  To make the pool of mortgages even larger, they created vehicles like adjustable-rate mortgages (ARMs), subprime mortgages and no-income, no-asset loans that allowed people to buy homes or take out home equity loans that they simply could not afford.  Last 02192006_iraglassSeptember, this house of cards came crashing down, setting off the global credit crisis and making an ongoing recession the worst in a generation.

Click here  to listen to the full “The Giant Pool of Money” podcast from “This American Life” to learn exactly what happened and why.  I know of no better description of how the recession happened.

Branding the Candidates

Wednesday, April 23rd, 2008

As an avid follower of presidential politics since the age of six, this year’s protracted primary process has been interesting.  The talking heads’ endless dissection of every policy statement; speculation as to which of the all-powerful super-delegates will back whom; the endless round of debates; the questions of who made the best impression.  One of the more interesting stories behind the story was National Public Radio’s (NPR) look at how the candidates have branded themselves.  Reporter Scott Horsley portrayed the Barack Obama brand as an accidental (McDonald’s was mentioned) franchise that harnessed activists’ energy and got them “fired up and ready to go”.  The catalyst was a 2006 chance meeting between Obama and a Texas community activist named David Kobeirowski, who was planning to start a book club to discuss “The Audacity of Hope”.  Obama approved of the idea, saying, “David, that is fantastic.  This is the kind of grassroots spirit I want to have all over the country.”  In effect, NPR reported, Kobierowski had become a Barack Obama franchisee – not a paid staffer, but an independent booster, acting with Obama’s blessing.According to Horsley, “Harnessing that kind of energy is one way for a start-up enterprise to quickly establish a national presence – whether they are selling hamburgers or Obama’s health care policy.”  The signature “O” logo has become a recognizable symbol – similar to interstate signs for franchise hotels and fast-food chains.  Next up was John McCain’s roller-coaster campaign, which has survived more ups and downs than the stock market.  According to NPR correspondent David Kestenbaum, McCain “started out as big and powerful before nearly going out of business.  Now he finds himself in the forefront again.  Business professors compare his campaign to products such as Apple computers or the Mars Bar, which have had similar boom-and-bust business patterns.”  The McCain candidacy – like the Mac computer – is perceived as a maverick.  Says David Brady, a senior fellow at the Hoover Institution and a professor of political science at Stanford University, the Mac computer “is never mainstream, in the sense that it doesn’t sell as many computers as Dell or HP, but they’ve got a nice loyal following.”  The same can be said of John McCain.  In NPR’s final report on presidential candidate branding, David Kestenbaum noted that the Hillary Rodham Clinton campaign comes across as a well-established national brand – but with a difference.  Clinton had a definite advantage coming into the race, having spent eight years in the White House as First Lady, as well as eight years in the Senate.  Like on “Cheers”, everybody knew her name.  Susan Jung Grant, assistant professor of marketing at the University of Colorado at Boulder, posits that if Bill Clinton is an established brand such as Lay’s Potato Chips, then “Senator Clinton could be sour cream and chive potato chips.  It’s the idea of a flanking brand that’s a little bit different from the main category.”  While an established brand can be perceived as hackneyed because of overexposure, an innovative variation can energize the candidate’s image and increase the appeal to consumers.  So which brand are the American people buying?  Stay tuned.