US-Based Drones for the Sake of Drones

(graphic: darkblack for Firedoglake)

Apparently, a bunch of people claiming to be interested in jobs inserted an amendment into the FAA bill requiring the FAA to allow for drones in US airspace. (h/t NC)

I became aware of the pro-drone legislation from a February 10, 2011, Syracuse Post Standard report that Sen. Charles Schumer (D-New York) was supporting an amendment to the pending Federal Aviation Administration (FAA) reauthorization bill (S. 223) that would create test zones for the introduction of drones into general airspace.

Senator Schumer was interested in the pro-drone amendment because MQ-9 Reaper drones, killer drones that are flying over Afghanistan, Pakistan and Iraq, are stationed at Hancock Air Base near Syracuse. However, FAA safety restrictions have limited drone flights out of Hancock.

“If Schumer’s legislative move succeeds this week,” said the Post Standard, “it would help ensure the future of 1,215 jobs at the (air) base in Mattydale (New York) and potentially lead to millions of dollars in radar research contracts for local defense companies.”

Aside from jobs, what’s remarkable about the push for drones is how amorphous the purpose of the drones are. Here’s Candice Miller, one of the sponsors of the amendment, describing the need:

My amendment is designed to help expedite and to improve the process by which FAA works with government agencies to incorporate unmanned aerial vehicles, or UAVs as they’re commonly called, into the National Airspace System. Currently, Mr. Chairman, law enforcement agencies across the country, from Customs and Border Protection to local police departments, et cetera, are ready to embrace the new technology and to start utilizing UAVs in the pursuit of enforcing the law and protecting our border as well.

However, the FAA has been very hesitant to give authorization to these UAVs due to limited air space and restrictions that they have. I certainly can appreciate those concerns; but when we’re talking about Customs and Border Protection or the FBI, what have you, we are talking about missions of national security. And certainly there’s nothing more important than that. It was a very, very lengthy exercise to get the FAA to authorize the use of UAVs on the southern border. While they’re finally being utilized down there, we are certainly a long way from fully utilizing these technologies. [my emphasis]

That is, we’re talking about CPB (which has used the drones for some years), but also the FBI, local police departments, and “et cetera” using the drones.

Did I miss the open, public debate about whether we want the FBI–much less local police departments or “et cetera” using drones to spy on Americans’ activities?

Then again, I guess this is why the government needs to trump up claims about self-radicalized Americans: to provide some justification, no matter how thing, for our latest jobs program.

Roger Ailes to Be Indicted?!?

Whoo boy. Think back to how loudly the mighty wurlitzer argued that Scooter Libby should not be indicted for lying. And imagine how much louder it will be if Roger Ailes–a cornerstone of Republican success–were indicted for telling Judith Regan to do the same?

That’s what Barry Ritholtz claims is about to happen.

Someone I spoke with claimed that Ailes was scheduled to speak at their event in March, but canceled. It appears that Roger’s people, ostensibly using a clause in his contract, said he “cannot appear for legal reasons.”I asked “What, precisely, does that mean?”

The response: “Roger Ailes will be indicted — probably this week, maybe even Monday.”

The NYT broke the underlying story on Thursday:

It was an incendiary allegation — and a mystery of great intrigue in the media world: After the publishing powerhouse Judith Regan was fired by HarperCollins in 2006, she claimed that a senior executive at its parent company, News Corporation, had encouraged her to lie two years earlier to federal investigators who were vetting Bernard B. Kerik for the job of homeland security secretary.


Now, court documents filed in a lawsuit make clear whom Ms. Regan was accusing of urging her to lie: Roger E. Ailes, the powerful chairman of Fox News and a longtime friend of Mr. Giuliani. What is more, the documents say that Ms. Regan taped the telephone call from Mr. Ailes in which Mr. Ailes discussed her relationship with Mr. Kerik.

Frankly, I’m skeptical. After all, Obama’s DOJ doesn’t like to indict any MOTUs. Besides, they’re too busy trying to prevent Scott Bloch from doing any time for having lied to Congress. And to think his DOJ (presumably former Chuck Schumer aide Preet Bharara, who is US Attorney for SDNY) would indict one of the most important players in the Republican party?

I doubt it.

But just on the off chance it’s true, I’m popping popcorn.

Update: It seems, they’d have a hard time indicting for the request that she lie itself: that took place in 2004, and presumably the statute of limitations would have expired in 2009. It’d be hard to say no one knew about the conversation given that it was front page news.

The Homes Chuck Schumer Didn’t Save

DDay and Zach Carter both reported yesterday on the NY Fed’s conclusion that the 2005 Bankruptcy Bill had pushed an extra 200,000 people into foreclosure. Here’s Zach:

Economists at the New York Federal Reserve have concluded that a controversial 2005 law backed by banks and credit card companies pushed more than 200,000 people into foreclosure and exacerbated the subprime mortgage crisis.


In a paper released Tuesday, New York Fed researchers Donald P. Morgan, Benjamin Iverson and Matthew Botsch determined that the law sparked about 116,000 additional subprime mortgage foreclosures a year after going into effect.What’s more, they note, these foreclosures pushed home prices down, which may have lead to additional foreclosures. When the value of a home drops below what a borrower owes on the mortgage, it becomes nearly impossible to get out of the loan by selling the house or refinancing, making foreclosure more likely if they become unable to afford the monthly payment.

“By making it harder for borrowers to avoid paying credit card debt, [the 2005 bankruptcy law] made it more difficult for them to pay their mortgages, so foreclosure rates rose,” the economists wrote.

Which I guess means it’s time again to recall what Chuck Schumer responded to me on January 28, 2008, when I pointed out that the bankruptcy bill was going to exacerbate the financial crisis that was about to hit. Schumer, Byron Dorgan, and Sherrod Brown all agreed the law was a problem. (Schumer and Dorgan voted against the bill, though Debbie Stabenow, pictured in my post, voted for it.) But, Schumer said, we couldn’t just fix the obvious problems with it in 2008 because (you guessed it) we needed a bigger majority.

Senator Schumer explained that he didn’t want to pick around the edges, he wanted to make a real fix, and we’re not going to be able to do that until we get a bigger majority.

That was, of course, in 2008. That November, the Democrats would win solid majorities in both houses, as big a majority as you’re ever going to get. Yet the Democrats never found time to get around to fixing the Bankruptcy bill.

Neo-Feudalism and the Housing Crisis

A number of people have linked to the part of this Joseph Stiglitz interview where he says we won’t fix the economy without some good old fashioned prosecutions. But I wanted to highlight where he describes the way our system of debt imposes a kind of indentured servitude on the debtors.

Can we draw a direct line from the outsize influence of the executives and the bankers — because these skewed incentives and penalties out of whack didn’t just arise out of a vacuum. How did we get to where we are?

It’s clearly the influence of campaign contributions and lobbyists. Let me give you another example of where the legal system has gotten very much out of whack, and which contributed to the financial crisis.

In 2005, we passed a bankruptcy reform. It was a reform pushed by the banks. It was designed to allow them to make bad loans to people to who didn’t understand what was going on, and then basically choke them. Squeeze them dry. And we should have called it, “the new indentured servitude law.” Because that’s what it did.

Let me just tell you how bad it is. I don’t think Americans understand how bad it is. It becomes really very difficult for individuals to discharge their debt. The basic principle in the past in America was people should have the right for a fresh start. People make mistakes. Especially when they’re preyed upon. And so you should be able to start afresh again. Get a clean slate. Pay what you can and start again. Now if you do it over and over again that’s a different thing. But at least when there are these lenders preying on you should be able to get a fresh start.

But they [the banks] said, “No, no, you can’t discharge your debt,” or you can’t discharge it very easily. They have a right, now, to take 25% of your before-tax income. Now imagine what that means. Let’s assume that you wound up, as it’s not that hard to do, with a debt equal to 100% of your income. You’re making $40,000, and your debt is $40,000. You have to turn over to the credit card company, to the bank, $10,000 of your before-tax income every year. But, the banks can now charge you 30% interest.

So what does that mean? At the end of the year, you’ve paid the bank $10,000, a quarter of your income. But what you owe the bank has gone from $40,000 to an even larger number because they’re charging you 30%. So you’re debt is larger. So the next year you have to give a quarter of your income again to the bank. And the year after. Until you die.

This is indentured servitude. And we criticize other countries for having indentured servitude of this kind, bonded labor. But in America we instituted this in 2005 with almost no discussion of the consequences. But what it did was encourage the banks to engage in even worse lending practices.

We’ve made it so difficult for individuals to discharge their debt and have this fresh start, and yet it is just taken for granted that a corporation or a company can blow up and then they can file for bankruptcy and then they can start over.

We give rights to corporations that we don’t give to ordinary Americans. One of my proposals in my book Freefall — one of the ways to deal with this foreclosure problem, the fact that one out of four Americans who have a mortgage are underwater: They owe more money on their home than the value of their home. Their home used to be what they used as the reserve for paying their kids college education, for their retirement. Now it’s a liability, not an asset.

So what I’ve argued is, we have these laws called Chapter 11 to give a fresh start to corporations. We say it’s very important to be able to do this quickly, we want to keep jobs, we want to keep the corporation going as an ongoing enterprise.

Families are as important as corporations. Keeping kids in school, not forcing them out of their home, keeping the community together, is certainly as important as keeping a corporation alive.

He calls this indentured servitude, but I call it (because I’m also factoring things in like the privatization of security and decline of the nation-state) neo-feudalism. In either case it’s an observation that people who used to be citizens have been turned into profit centers for the very powerful. Through a variety of means, these very powerful entities have secured the ability to oblige those profit center people to turn over large chunks of their  worldly gain for the foreseeable future, and even though those powerful entities offer little in return, the people bound to them have little hope of escape. Hell, in many states, mortgages serve as a similar kind of legal bind to a piece of territory, one ultimately owned (if they can prove they have the note) by these powerful entities.

And as Stiglitz notes, a key to pulling this shift off is to write the law to favor the powerful entities and disempower the weak. And (as he points out elsewhere in this interview) to make sure that only those powerful entities have access to justice.

Yet, as a recent study made clear, the access to justice for the poor in this country rivals that of Mexico and Croatia.

In January 2008, well before the financial crisis became an emergency, I asked Chuck Schumer why Democrats didn’t repeal the 2005 Bankruptcy Bill Stiglitz addresses above. I pointed out that repealing it might mitigate the problem of foreclosures and with it, stave off a larger crisis.

Schumer responded by saying we did not yet have the votes to make the kind of substantive overhaul that was necessary. We had to wait, he said in January 2008, eight months before foreclosures contributed to the the collapse of financial system, until 2009, when we had a larger majority.

We just lost the majority that Schumer claimed we would use to repeal the bankruptcy bill. During the entire time the Democrats had the majority, families were losing their homes in ever increasing numbers.

And yet Democrats never used their vaunted majority to stem the advance of neo-feudalism in this country.

Did Servicers Commit Fraud So Banksters Could Get Big Bonuses?

When I asked yesterday about the relationship between the stress tests and the servicers’ foreclosure fraud, I had a hunch that the banksters might have been committing that fraud so as to be able to show financial viability so as to be able to repay TARP funds so as to escape the oversight of the government. I wondered whether the stress tests were not just a means by which the government should have exercised some control over the servicers that they already knew to be having problems, but were also one reason the servicers were pushing for the most profitable outcomes (including choosing to foreclose rather than modify loans).

Rortybomb, who knows a lot more about how this stuff worked than I do, provides these damning details:

For what it is worth, I’m sure those conducting the stress test knew that this conflict existed and knew that it was very profitable to the banks. Servicing is considered a “hedge”, because as the origination business dries up foreclosures will increase and servicing income would go up, something Countrywide and others loved to talk about.

Let’s go to a Countrywide Earnings call from Q3 2007:

Now, we are frequently asked what the impact on our servicing costs and earnings will be from increased delinquencies and lost mitigation efforts, and what happens to costs. And what we point out is, as I will now, is that increased operating expenses in times like this tend to be fully offset by increases in ancillary income in our servicing operation, greater fee income from items like late charges, and importantly from in-sourced vendor functions that represent part of our diversification strategy, a counter-cyclical diversification strategy such as our businesses involved in foreclosure trustee and default title services and property inspection services.

The servicing operation will “fully offset” lost income from increased delinquencies and lack of origination business. This is by design. It’s tough to find good counter-cyclical strategies, but this appears to be one. If you were both TBTF and really in need of cash, could you squeeze this a bit further, say by violating the rule of law?


Someone enterprising on the hill could ask how the servicing income was incorporated into the stress test and how predictive it was in the adverse scenario case. Things like this make it even more important that the government takes a strong hand in rooting out foreclosure fraud.  We cannot allow an impression to form that we collectively looked the other way at issues of foreclosure abuse, issues well documented since before the stress test, because this business line is one of the few profitable things available to TBTF firms.  TBTF firms that needed cash, were (and are) backstopped by taxpayers and wanted to get out of TARP to issue bonuses.   Nobody gets to be above the law, regardless of how systemically important they are or whatever numbers needed to be hit on the stress test.

In other words, going back to 2007, mortgage companies were upfront in claiming that their servicer-related profits served to offset their loan losses. That’s not to say they would have argued that in their stress test results (again, I’m not expert on this, but I’m not even sure that the stress tests looked at the servicer income). But it does say that to prove viability–to make a half-credible claim they weren’t insolvent and to evade restrictions on bonuses and political giving–they had an incentive to suggest their servicer income was enough to offset a significant chunk of their loan losses. That not only gave them a huge incentive to keep servicer costs low (by doing things like hiring WalMart greeters and hair stylists to serve as robo-signers), but it also increased the incentive to increase profits as a servicer by refusing to modify loans.

So I’d go further than Rortybomb in calling for some enterprising Hill person to look into this. Given that we know Timmeh Geither, campaigner against injustice, was officially warned and knew about this conflict, I’d like to know how much he knew about this hedge. The Administration now says it was helpless to stop this kind of fraud, yet it chose not to use at least two sources of leverage (cramdown and stress tests) to control it. Is that because they knew the servicer fraud was an important part of extend anad pretend?

Dems Not Only Call for National ID, but for Anti-Democratic National ID

As DDay reported, the Reid-Schumer-Menendez draft on Immigration Reform calls for a national ID card (which they call a “biometric” or “fraud proof” social security card). Perhaps in a move to placate civil libertarians, the draft insists the card will only be used for employment.

It will be unlawful for any person, corporation; organization local, state, or federal law enforcement officer; local or state government; or any other entity to require or even ask an individual cardholder to produce their social security card for any purpose other than electronic verification of employment eligibility and verification of identity for Social Security Administration purposes.

Now, let’s pretend for a moment that this national ID program would actually fix the problem of employers trying to hire cheap, vulnerable labor rather than paying market rate wages. Let’s pretend for a moment that this national ID program would avoid all of the security and privacy issues that such a program will be bound to have.

Why in fuck’s name would anyone with a “D” next to their name advocate for a national card–of any sort–without at the same time attaching it to automatic voter registration, also tied to the card? Why would the Democratic party propose any national program that did not, at the same time, insist on getting rid of our byzantine voter registration system that leaves large chunks of the population exposed to disenfranchisement? Even if this is just a stunt designed to prove Democrats are “serious” about compromise so they can embarrass the bigots even more for their refusal to accept the compromise, why would you ever miss the opportunity to tie a universal registration card to a potential fix to the problems in our election system?

The Chuck and Huck Show

Say, have you noticed how often Chuck Schumer has been nuzzling up to Lindsey “Huckleberry” Graham lately?

There’s their plan on immigration reform which, among other things, calls for a national biometric ID card.

And there’s a bill to pressure China on currency manipulation.

I raise this for two reasons. First, Huck’s efforts to institutionalize indefinite detention thus far lack a real legislative champion. At the same time, Chuck’s flip-flop on 9/11 trials in NYC was one of the key reasons that plan failed. So I worry that Chuck will be the guy who gives Huck’s Constitution shredding a liberal face (and why not, if you’re already instituting national ID cards).

Of course, this is all happening against the background of a potential Majority Leader fight next year if Harry Reid loses his re-election bid. Chuck seems to be prepping a run on bipartisan effectiveness. With an eye at least partially on the Majority Leader run, after all, Chuck negotiated a deal with Orrin Hatch that ended up being the only jobs bill passed this year (though of course it won’t really do squat for jobs because it is far too small, and it may well endanger social security in the long run.

I have long thought Chuck would make a badly flawed (because Wall Street owns him, and because his moral compass blows with the wind) but effective (because a significant proportion of Senators owe their seat to him, and because he has the ability to throw big fundraising dollars to Senators) Majority Leader. Moreover, no matter whether I like it or not, I do think he’s the most likely person to replace Reid, if it comes to that.

Which is why I think it all the more important to start cataloging the way that Chuck’s efforts to rack up a quick record of bipartisan success compromise on bedrock Democratic principles.

You know … things like the Constitution.

Republicans Prepare to Kill Jobs; Democrats Angle for Majority Leader

Brian Beutler reports that the Republicans are prepping to make sure no additional support for jobs gets passed next week.

Senate Democrats want to vote on the first installment of a jobs package as early as Monday, amping up the pressure on Republicans to get aboard. But for the moment, they’re not biting.

“We’ll have a vote on a jobs bill on Monday,” Senate Majority Leader Harry Reid said at a press conference today.

There’s just one wrinkle: According to the Senate’s top vote counter, there is currently no Republican support for the proposal Democrats are putting forth–and with Scott Brown to be seated today as the 41st Republican Senator, they’ll need at least one member of the minority to come aboard.

“You need two to tango. And you need Republicans for bipartisanship,” said Senate Majority Whip Dick Durbin (D-IL).

Now, there’s an interesting subplot to this.

Current Majority Leader (and very endangered incumbent) Harry Reid says no Republicans currently support the bill.

Majority Whip and second-most senior Democratic Senator Dick Durbin suggests there are no Republicans supporting the bill.

Meanwhile, Vice Chairman and third-most senior Democratic Senator Chuck Schumer has been working on a deal–at least for tax credits for businesses that create jobs–with Republican Orrin Hatch.

Sens. Chuck Schumer (D-N.Y.) and Orrin Hatch (R-Utah) released a plan Wednesday to give tax breaks to companies that add new workers, a proposal that is likely to become a key component of the jobs bill Senate Democratic leaders are hoping to unveil this week.President Obama has called for employers to receive a $5,000 tax credit for each new employee they hire, while other lawmakers have floated different proposals for a job tax credit. The Schumer-Hatch plan, which would allow companies to avoid paying Social Security taxes for the duration of 2010 on each unemployed worker they hire, appears to have the most momentum in the Senate.

“Our payroll tax cut is a simple, cost-effective and bipartisan solution. It will help put more Americans to work right away,” Schumer said in a press release. Hatch added: “While Senator Schumer and I disagree on most issues, we’ve been able to come together on an affordable, effective and targeted proposal to get the American people back to work.”

Democratic leaders emphasize that they haven’t yet settled on an exact combination of items that will go in the Senate’s jobs package, but Senate Majority Leader Harry Reid (D-Nev.) suggested Wednesday that he was taking a close look at the Schumer-Hatch bill.

Mind you, the Schumer-Hatch deal only deals with one aspect of the deal, not with things like COBRA subsidy extension. And I’ve got concerns about any plan that defunds social security.

Nevertheless, it seems that the drama over whether Democrats will squabble themselves into irrelevance–and/or whether Republicans will sacrifice the interests of their constituents for partisan gain is playing out large on the jobs front.

Whatever is happening, it is preventing Americans from getting back to work.

Chuck Schumer to Bloggers: “Fuck You”

Jay Rosen first pointed me to the news that Chuck Schumer is aiming to declare all us DFH bloggers non-journalists before the law.

For citizen journalists, the federal shield law front was looking good for a while.  Although the House of Representatives version of the bill, passed in April, only offered a shield to professional bloggers, the Senate version didn’t differentiate between the pros and the amateurs.  So there was hope that amateur journalists might actually, eventually, get its protection.

No longer though.

Sadly, the Senate Judiciary Committee has followed the path of the House and opted to specify that only a "salaried employee . . . or independent contractor" will be able to invoke the shield, reports the Wall Street Journal’s Digits blog.  The amendment, offered by Sen. Chuck Schumer (D) of New York, limits the definition of a journalist to one who:

(iii) obtains the information sought while working as a salaried employee of, or independent contractor for, an entity—

(I) that disseminates information by print, broadcast, cable, satellite, mechanical, photographic, electronic, or other means; and

(II) that—

(aa) publishes a newspaper, book, magazine, or other periodical;

(bb) operates a radio or television broadcast station, network, cable system, or satellite carrier, or a channel or programming service for any such station, network, system, or carrier;

(cc) operates a programming service; or

(dd) operates a news agency or wire service . . . 

This language is in fact more restrictive than its House counterpart, which only limits the shield to those who gather or disseminate news "for a substantial portion of [their] livelihood or for substantial financial gain."  The Judiciary Committee’s "salaried employee . . . or independent contractor" language on its own would be sufficient to deprive most non-traditional journalists of protection.  But the requirement that the hosting entity both disseminate information by electronic means and operate a publishing, broadcasting, or news service of some kind ices it.

So to be a journalist in Chuck Schumer’s eyes, you have to both have a boss (at this point, you generous readers and Jane would count as my boss, but Jane doesn’t have a boss, for example) and that boss’ company must disseminate news on some other medium, in addition to the Toobz. Read more

Chuck Schumer for Majority Leader

Update: I’ve been reliably informed that Schumer made the comments to the NYT on Thursday, before his Friday meeting with POTUS.

Since I’ve been obsessing about all the excess brush in TX now that we have a President who insists on working in August, I’ve been tracking Obama’s schedule very closely. And so I noticed on Friday that Chuck Schumer had a late afternoon meeting in the Oval Office that was closed to the Press.

Just Chuck Schumer.

I found that rather odd, since Schumer’s Chairmanship–of Rules–isn’t necessarily one that would be of interest to the President. Unlike the House, for example, the Senate Rules Committee isn’t going to have significant say over how a bill–health care, for example–comes up for a vote. [Update: I’m increasingly convinced this is wrong: Rules might be critical if they tried to do health care in reconciliation.]

And while there are a number of things buzzing in NY–notably, the confirmation of NY’s Sonia Sotomayor and US Attorney and former Schumer aide Preet Bharara–that might concern both the White House and NY’s senior Senator. But on a lot of those issues, some other Committee Chair would be involved (such as Pat Leahy for judiciary issues), which make it less likely that’s what the White House wanted to chat to Schumer and just Schumer about. Furthermore, some issues (such as Carolyn Maloney’s decision not to challenge Kristen Gillibrand) would be more appropriate in a non-official venue.

So I’ve been assuming that Schumer got called to the White House because he has a unique ability to get things done in the Senate. That’s partly by virtue of his past tenure as DSCC Chair; thirteen Senators owe their position to Schumer, including a number of moderates (Sheehan, Warner, Hagen, Franken, Udall, Udall, Merkley, Begich, McCaskill, Webb, Tester, Brown, Casey, and Whitehouse). He’s the kind of guy who, if he were majority leader, would be tremendously effective and would have a lot of chits to call in on key legistlative battles. Oh, and he’s also on the Finance Committee–the committee on which six totally unrepresentative Senators are holding healthcare hostage.

Which is why I’m curious to see these comments from Schumer. (h/t Americablog)

“If they can’t do it by Sept. 15th, I think the overwhelming view on the Democratic side is going to be, then, they’re never going to get it done,” Senator Charles E. Schumer, Democrat of New York, observed in a separate interview. “And there’s always a worry that, you know, delay, delay, delay, you lose any momentum whatsoever.”

Read more