EFTA01143161.pdf

From: Gregory Brown To: undisclosed-recipients:; Bcc: [email protected] Subject: Fwd: Greg Brown's Weekend Reading and Other Things.... 07/07/2013 Date: Sun, 07 Jul 2013 17:15:52 +0000 Attachments: The_Last_Mystery_of_the_Financial_Crisis_Matt_Taibbi_Rolling_Stone_June_19,_2013.pd f; War_On_the_Unemployed_Paul_Krugman_NYT_June_30,2013.pdf; U.S._Poverty,fly_the_Numbers_The_Nation_2011_data_07_03_2013.pdf; The_Gap_Between_SNAP_and_Basic_Economic_Security_John_Light_Moyers_&_Co_Jun e_28,_2013.pdf; Hunger_and_the_Sequestration_by_the_Numbers_Gregyaufman_Moyers_&_Companyiu ly_2,2013.pdf; Why_Is_SNAP_Part_of_the_Farm_Billioel_Berg_Moyers_&_Co_July_2,2013.pdf; Big_Companies_Paid_a_Fraction_ofCorporate_Tax_Rate_Nelson_Schwartz_NYT_July_l, _2013.pdf; Gregyaufinann_on_the_Truth_About_American_Poverty_Moyers_&_Companyiune_28, 2013.pdf; AltaVista._What's_That_Nick_Bilton_NYT_July_l ,_2013.pdf; Army_Ousts_Egypes_President,_Morsiis_Taken_Into_Mi_litary_Custody_David_Kirkpatr ick_NYT_July_3,_2013.pdf; 80%_of_Pre- Packaged_Foods_in_America_Are_Banned_in_Other_Countries_CNCBC_June_24,_2013.d ocx Inline-Images: image.png; image(1).png; image(2).png; image(3).png; image(4).png; image(5).png; image(6).png; image(7).png; image(8).png; image(9).png; image(10).png; image(11).png; image(12).png; image(13).png; image(14).png DEAR FRIEND There is a serious question that we Americans should ask ourselves. Here in the richest country on earth, 50 million of us — one in six Americans — go hungry — WHY? More than a third of them are children. Yet Congress can't pass a Farm Bill because our representatives continue to fight over how many billions to slash from the Supplemental Nutrition Assistance Program, better known as food stamps. The debate is filled with tired clichés about freeloaders undeserving of government help, living large at the expense of honest hardworking taxpayers. A new documentary, A Place at the Table, paints a truer picture of America's poor. Last week Bill Moyers spoke with Kristi Jacobson, one of the film's directors and producers, and Mariana Chilton, director of the Centerfor Hunger- Free Communities, explain to Bill how hunger hits hard at people from every walk of life. EFTA01143161  611 .... its t FROM THE PEOPLE WHO BROUGHT YOU FOOD, INC. PLACE AT THE HMV!RUC.DRITINAT MEN MD'S! fiVSIRITRBUSH,, !VISilYntalnil VMS ,,*1PIZEDI IV:. I. 45-7;2 PSH yd.N !if 'ORAN C.;:t:)):t1 IAlkI L.;:F. AIN : • pG PASE141AL CUOI.4.1 Stria.S113 • , YI Villa, Wit .JJ 'Alt I n. C•I:te• mci Jun FKRi$11236SON lail SIMON pa rt mf ap riagricot•I .•••••• C 4131itlif YIP WU* C3PAIII EEO E P.A.70 recLUIL MN FIR CIPt.TS DX. Parts:pant L&diI Web site for Bill Moyer's interview: http://billmovers.com/segmentfkristi-jacobson-and-mariana-chilton-on-how-hunger- hurts-evervone/ EFTA01143162 In the film there is a rancher and a police officer in Colorado, each struggling to make ends meet. And to make ends meet they have to rely on the charitable food programs sponsored by the church of a local Colorado minister, Pastor Bob Wilson. In the film the police offer explains that until recently there use to be three officers but due to budget constraints only he is left and he hasn't received a pay raise in four years, while what he use to spend on a month in groceries now only lasts about two weeks. Hence, he uses a local minister, Pastor Bob Wilson's food bank to get by. In a second story, after working from dam to 3pm on his ranch, cowboy Joel goes immediately down to the local school to dean it up from 3pm to iipm, so that he can buy groceries to put food on the table for his kids. What is mind blowing is that a cop who doesn't make enough money to meet all of his food needs and a cowboy who has to take two jobs to help feed his children, are not the exception, in fact they're very representative. 8o% of people receiving government food assistance are working poor. That means their wages are so low that they're eligible for food stamps. There is a stereotype that food banks are for the unemployed or the disabled, people who can't go out and get a job or don't want one. Today, this isn't always the case, hard working people even with two jobs need a little extra help and for them the stigma is humiliating. They are hard working fathers of families, single-mothers, excellent parents. They want the best for their kids. They're often working two or three jobs. Sometimes they'll have to work under the table in order to make ends meet, trying to find side jobs. They're hustling really hard. And there's an enormous amount of shame that they experience when they run out of money before they can get more food. It really tests their sense of manhood, motherhood, their sense of citizenship, of belonging. It's very isolating. And not only for the parents, but for their children too, who when hungry they are always told, "Don't talk about it. Don't let anybody know how hard it is. Always put on a goodface. Always look good," so that you are treated with a sense of dignity and respect. As a result, they often hide their own experiences of hunger or hide the fact that they can't feed their own children. Even worse is that hunger sometimes passes down as a legacy to the next generation. It gets transferred from generation to generation. Now, during an economic downturn when there are not enough good paying jobs, of course hunger will skyrocket. But people don't realize that hunger is very damaging to children, especially to young children. Food insecurity affects the cognitive, social and emotional growth of very young children. That means that by the time they arrive to kindergarten they're not ready for school. That means that when they're in school if they're hungry they won't be able to concentrate on what they're learning and they won't do as well on their math and their reading tests. That means they won't be as successful, won't get a good paying job so that when they have children they, too, will be poor. So poverty is an experience that is seared into the bodies and brains of children and possibly their children. What happens to someone who gets too little nutrition early in life? If you think about what's happening in the first three years of life the brain is growing so fast. They're the most important years of human development. So every moment those are the building blocks of good cognitive, social and emotional development. Neurons are growing and pruning and very active. boo neurons are growing a second for an infant. It's an important window of human development. So any type of nutritional deprivation during this time has a severe impact on the brain even if it's just episodic, even if it happens once or twice a month those are moments of lost opportunity to be able to interact with their family and their environment, to pay attention and to learn something new which helps to grow more neurons. It affects the cognitive, social and emotional development. It creates a certain kind of a stress on the child that's very toxic. And we know from experts that children who experience this kind of toxic stress can't learn as well, can't learn as fast. We know that this can turned around with food assistance programs, with a program called WIC, Women, Infants and Children or the food stamp program. The best investment of our dollars in this country is investing in very young children and their families because again those are the most important times when a child's brain is growing. So for every one EFTA01143163 dollar that you spend on a child you make seven dollars back when they become an adolescent. It's a beautiful investment. But more importantly, it's the right thing to do. The effects of hunger: You see it in school performance, their ability to get along with others, their ability to pay attention for children of school age. Attendance. You see it in the increased hospitalizations, showing up more to the emergency room when they don't-- with preventable diseases, or preventable exacerbation of asthma. If we treated poverty during childhood as a type of a disease, if we paid as much attention to poverty for children as we pay attention to infectious disease, we could definitely eradicate hunger in this country. The film — A Place at the Table — makes dramatically clear the relationship between malnutrition and obesity. As they are neighbors and that they happen often at the same time and often in the same family, in the same person is because they are both signs of having insufficient funds to be able to command food that you need to stay healthy. If you look at what has happened to the relative price of fresh fruits and vegetables -- they have gone up by 40 percent since 1980 when the obesity epidemic first began. In contrast, the relative price of processed foods has gone down by about 40 percent. So if you only have a limited amount of money to spend you're going to spend it on the cheapest calories you can get and that's going to be processed foods. Finally this has to do with our farm policy and what we subsidize and what we don't. Hunger and obesity are both forms of malnutrition. Obesity often means not getting the right kinds of nutrients for an active and healthy life. If you go back to the definition of food insecurity it means — not having enough foodfor an active and healthy life. So when people think about hunger they think, "Oh, it's just not enoughfood." But actually its food insecurity which is a much broader term, much more precise, captures a type of experience where families don't have enough money for healthy and fresh food so they will, in order to stretch their dollar.... they'll spend it on soda or on foods that have very high calories. Because they know that their kids are hungry, they have to be able to stretch their dollar in order to fill their own tummies and the tummies of their children. They know it's not healthy, but they're just trying to solve the immediate and the immediacy of hunger. The end is eating lots of high calories, salt, sodium. And those are the kinds of foods that are not good for an active and healthy life. It's another form of hunger. So you can look at people who are overweight and obese and think maybe they don't have enough money for food, maybe they're anxious about where their next meal is coming from. As a result there are 5o million people, one in six Americans who are food insecure, who do not have enough good nutrition to thrive. Conservatives who hate big government will tell you that charities should take the lead against hunger. When the fact is that we need government to take a leadership role as there are millions of people suffering from hunger and food insecurity in every county and in every state in our country. The 80's created the myth that A. hungry people deserved it and B. well we could really fill in the gaps with the charities. And we had a proliferation of emergency responses, soup kitchens, food pantries moving from literally a shelf in the cupboard of the pastor's office to an operation with regular hours. Something changed during that period of time. There developed this ethos that government was doing too much and more importantly, the private sector is wonderful and let's feed people through charity. Obviously this hasn't worked. If you want to talk about dependency in this country, let's talk about corporations and businesses that pay such low wages that they depend on the United States government to add money to those wages through the Income Assistance Programs, like SNAP. Lets take a company like Wal-Mart, who pays their workers so low that their workers are actually eligible for food stamps. And Wal-Mart has the chutzpah to have paid employees on staff help their own employees qualify for food stamps. When you look at the situation this way, who's dependent on the U.S. government? I'd have to say it's Wal- Mart is the welfare queen here. There are 48 million people are receiving food stamps. But it's also important to look at how many corporations and agribusinesses are collecting subsidies out of the same government bill, the farm bill. There is an ethos in Congress right now that assisting those EFTA01143164 individuals who need help via the food stamp program or WIC or school meals is big government and is going to put us into debt. But providing subsidies to large agribusinesses and big corporations is just business as usual. We have basically created a kind of secondary food system for the poor in this country. Millions and millions of Americans, as many as 5o million Americans rely on charitable food programs for some part of meeting their basic food needs. The churches and the community groups that hand out food are doing an incredible service to this country and to the children that are experiencing hunger, but that's just a quick fix, that's for today and tomorrow and maybe for next week. We call it emergency food? It's no longer emergency food. This should be called a chronic use of a broken system for which people cannot be held accountable. But as the actor Jeff Bridges says in A Place at the Table: "Charity is a great thing, but it's not the way to end hunger. We don'tfund our Department of Defense through charity, you know. We shouldn't you know, see that our kids are healthy through charity either." The average food stamp benefit is $3 a day. I challenge you to go to your local supermarket and try tofeed yourseif and yourfamily on $3 a day. Children by family income, 2011 Less than 100% FPL Above 22% Low- income law-income 45% 55% 100-199% FPL 22% Percentages may not odd to 100 due to rounding. © National Center for Children in Powqty (www.nccp.org) Basic Facts Aixot Low-income Children: Children Under 18 Years, 2011 EFTA01143165  • Children in poverty: 1.6.1 million, 22 percent of all children, including 39 percent of African- American children and 34 percent of Latino children. Poorest age group in country. • Deep poverty (less than $11,510 for a family of four): 20.4 million people, 1 in 15 Americans, including more than 15 million women and children • People who would have been in poverty if not for Social Security, 2011: 67.6 million (program kept 21.4 million people out of poverty) • People in the U.S. experiencing poverty by age 65: Roughly half • Gender gap, 2011: Women 34 percent more likely to be poor than men • Gender gap, 2010: Women 29 percent more likely to be poor than men • Twice the poverty level (less than $46,042 for a family of four): 106 million people, more than 1 in 3 Americansobs in the U.S. paying less than $34,000 a year: 5o percent • Jobs in the U.S. paying below the poverty line for a family of four, less than $23,000 annually: 25 percent • Poverty-level wages, 2011: 28 percent of workers • Percentage of individuals and family members in poverty who either worked or lived with a working family member, 2011: 57 percent • Families receiving cash assistance, 1996: 68 for every 100 families living in poverty • Families receiving cash assistance, 2010: 27 for every 100 families living in poverty • Impact of public policy, 2010: Without government assistance, poverty would have been twice as high — nearly 3o percent of population • Percentage of entitlement benefits going to elderly, disabled or working households: Over 90 percent. • Number of homeless children in U.S. public schools: 1,065,794nnual cost of child poverty nationwide: $55o billion • Federal expenditures on home ownership mortgage deductions, 2012: $131 billion • Federal funding for low-income housing assistance programs, 2012: Less than $50 billion The Gap Between SNAP and Basic Economic Security There's a wide gap between the income cutoff for government food assistance and the income required to provide children with a nutritious diet. As of early 2013, nearly 48 million Americans received food assistance through the Supplemental Nutrition Assistance Program (SNAP). That's about 15 percent of the country. Despite those numbers, a May 2013 report by the U.S. Department of Agriculture (USDA), which oversees SNAP, found that 21 percent of families with children experienced food insecurity in 2011 - meaning that at least some family members couldn't get enough to eat to lead `active, healthy lives." EFTA01143166  The SNAP gap for a family of three $8,000 $6,000 • $4,000 2 $2,000 L • $0 New Mexico O eo a co I E tS t I a To 0 rj ow BEST index data supplied by Wider Opportunities for Women. Interactive chart by ifi+ ++++ableaw To qualify for SNAP - which, until 2OO8, was called the Federal Food Stamp Program — a family can earn no more than 13O percent of the federal poverty guideline, which is established each year by the Department of Health and Human Services. Until October 2O13, that figure is set at $2,O69 per month ($24,828 @ year) for a family of three; after that, it will be bumped up by about $5O. But many antipoverty advocacy groups point out that 13O percent of the poverty guideline is hardly a comfortable income for a family with children. The nonprofit group Wider Opportunities for Women (WOW) has developed its own indicator for economic security called the Basic Economic Security Tables index, or BEST index. The index differs from state to state, and even between cities within a state, because of differences in the cost of living, including the price of food and childcare. WOW found that across the country, the actual income required for a family of three (one adult and two children) to be economically secure is 2OO or 3OO percent of the federal poverty guideline, not the 13O percent the USDA uses as the cutoff for SNAP. That leaves many families — especially those headed by a single parent — in an uncomfortable place where they may not make enough money to buy quality food, but make too much to qualify for government assistance. The chart above shows that gap in a handful of states across America. Mouse over each bar for details. *0 *000 Hunger and the Sequester, By the Numbers EFTA01143167  SEQUESTRATION IMPACT ON MEALS ON WHEELS PROGRAMS BY THE NUMBERS 1IN7SENIORS STRUGGLE WITH HUNGER are eliminating staff are reducing the number are cutting the number positions of seniors being served of meals served Over 70% are establishing or adding to existing waiting lists. Ift 1 IN 6 PROGRAMS are closing congregate sites or home delivered meal programs. AIMS\ 40% C\ O (Th O are reducing the number of days they deliver meals. VI al Meals On Wheels 1$300A0a0 or AVER/CA $0 SO Sestite r1 kyr& lte nun*/ wog caxlmool Aby 7-10. 2049. among Mods On Whoon atomomanco Monts* ono cvmety mans Wong VoSng trough to ago knoemaro Act Sequestration cuts will total $1.2 trillion through fiscal year 2021. This year there is a 5.3 percent cut, totaling $85 billion. The cuts are indiscriminate and will impact nearly every federal program.* Here are some of the ways this year's cut is affecting food and hunger programs, in America and abroad. Domestic Programs • Meals for needy seniors lost in programs like Meals on Wheels (MOW): 4 million • Savings from cut of 4 million meals: $10 million EFTA01143168  • Rise in Medicaid costs due to cut of 4 million meals: $489 million • Net cost to U.S. federal budget due to cut of 4 million meals: $499 million • Loss of senior meals, California: 750,000 • Loss of senior breakfasts, Palm Beach County, Fla.: 24o daily • Loss of senior meals in group dining facilities, Detroit suburbs and several counties: 86,000 • Loss of home-delivered and group dining senior meals, La Crosse County, Wis.: 6,000 International Programs • Cuts to global poverty-focused development assistance (PFDA) programs: $1.1 billion • People who will experience reduced or denied access to lifesaving food: 2.1 million • Children who will experience reduced or denied access to school feeding programs: 234,000 • Children who will be unable to receive nutritional interventions that save lives and prevent irreversible damage caused by malnutrition: 605,625 • Farmers and small businesses in poor countries that won't receive support from Feed the Future, a program to help them lift themselves and their communities out of poverty: 1.17 million Reflections • Ellie Hollander, president and CEO of the Meals on Wheels Association of America: "The real impact of sequester is that our programs don't have the ability to expand to meet the growing need. We should be investing in these programs to ensure our seniors have the nutritious meals they need to remain healthy and independent." • Patricia Hoeft, director of senior center nutrition, the Mid-East Area Agency on Aging (Missouri): "How do I decide which 300 seniors aren't going to eat that day?" • Meals on Wheels recipient, home delivery program, La Crosse County, Wis.: "These meals are sometimes the only meal that I have a day. I don't drive, so I have to rely on others to get around to doctors' appointments. I only get $16 a month for food." Some low-income programs are exempt from cuts, including Medicaid, Supplemental Nutrition Assistance Program (SNAP,formerlyfood stamps), the refundable tax credits and some child nutrition programs. by Greg Kaufmann July 2, 2013 As many of you know I am a big fan of TED which is a nonprofit devoted to Ideas Worth Spreading. It started out (in 1984) as a conference bringing together people from three worlds: Technology, Entertainment, Design. Since then its scope has become ever broader. Along with two annual conferences -- the TED Conference on the West Coast each spring, and the TEDGlobal conference in Edinburgh UK each summer -- TED includes the award-winning TED Talks video site, the Open Translation Project and TED Conversations, the inspiring TED Fellows and TEDx programs, and the annual TED Prize. Recently TED has join together with The Huffington Post to reach a broader audience through its TED Talks Weekends, and while perusing their offering this week, I ran across and interesting lecture (Talk) by former Greek Prime Minister, George Papandreou - titled, Imagine A European Democracy Without Borders. EFTA01143169 Web Link: http://www.huffingtonpost.com/tedglobal/george-papandreou-at-tedg_b_3428741.html Greece has been the poster child for European economic crisis, but Papandreou wonders if it's just a preview of what's to come. "Our democracies," he says, "are trapped by systems that are too big to fail, or more accurately, too big to control" -- while "politicians like me have lost the trust of their peoples." How to solve it? Have citizens re-engage more directly in a new democratic bargain. Talking about the failure of leadership in our globalizing economy. Papandreou believes that the failure of leadership is that people have been taking out of the process, based on the foundation of democracy that people working together could be masters of their own fate and democracy was the political innovation that protected this freedom, limiting the tendency of the powerful to maximize power and wealth at the expense of the greater good for everyone else. And although Greece triggered the economic crisis in the Eurozone but he says that today most people would agree that Greece was just a symptom of the greater structural problems in the Eurozone due to vulnerabilities in the wider global economic system, "vulnerabilities of our democracies, our democracies are trapped by systems too big tofail, too big to control. Our democracies are weaken by people in the global economy with players who can evade laws, evade taxes, evade environmental or labor standards. Our democracies are undermined by the growing inequality ofpower and wealth, lobbyist, corruption, the speed of the markets or sometimes when wefear an impending disaster which have constrained our democracies and our ability to use our potential infinding solutions." Papandreou says that Greece was only a preview and hopes that Greece, Europe and the world will make radical transformations in our intuitions. He says that in this new paradigm of globalization there is a collective ignorance and fears, which lead European leaders to fully invest in the "blindfaith" of orthodoxy of austerity. And when austerity didn't work, they then blame the people for being lazy as a result of indulgent social policies. No one blamed the banks and bankers who made millions and billions writing loans that those profligate, idle, ouzo swilling, Zorba dancing Greeks they are the problem Papandreou warns that this is not just about Greece, as this could be the pattern that leaders follow again and again when we deal with these complicated cross-border problems, whether its climate change, migration or financial regulations, abandoning our collective power to imagine our potential, falling victim to our fears, our stereotypes or dogmas, taking our citizens out of the process instead of building the process around them and doing so will only test the faith of our citizens in their democracy. And although it appears that Greece and Europe has weathered the economic storm, if politics is the power to imagine then 6o% youth unemployment in Greece and in other countries is a lack of imagination if not a lack of compassion. So far Europeans have only used economics to solve the EFTA01143170 problem and mostly austerity, whereas they could have designed other strategies, such as investing in green jobs and new technologies. Without broad-based participation, we are losing trust in our democracies, especially when today we have globalize the markets but we have not globalized our democratic institutions. As a result, our politicians are limited to local politics while our citizens are prey to forces beyond their control. Papandreou says that because the EU is the largest and most successful cross-border peace experiment, we should use it as a model for more expansion with a common identity, where education is through participation, where participation builds trust and solidarity rather than exclusion and xenophobia. A Europe of and by the people, a Europe in deepen and widening democracy. As Papandreou confessed, it can sounds naive to put faith and power in the wisdom of the people. But something has to change. And this disruptive change won't be given easily, as it is the interest of those in power to keep the status quo. As such all of us will have to have to take a stand if we really want things to change. The means, everyone who stands up against justice and inequality, everyone who preaches racism instead of empathy, dogma rather than critical thinking, technocracy rather than democracy and everyone who stands up to the unchecked power whether they be authoritarian leaders, plutocrats hiding their assets in tax havens or powerful lobbyist protecting the powerful few. Again, I know that this sounds naive, but so did the dream of democracy when the Greeks first invented it in the 5th Century BCE Remember: if we collectively or individually don't reach for a higher place, we will never get there On Wednesday July 3, 2013 the Egyptian military announced the removal of Mohammed Morsi as President, presenting a roadmap for reconciliation in the country. In a televised statement Egyptian military chief Abdel Fattah al-Sisi announced that the plan calls for the temporary suspension of the constitution and the institution of a technocrat government. The chief justice of the constitutional court will lead the country in the interim. Tahrir Square, where thousands of people had gathered during the day, erupted in celebrations as soon as the news was announced. It was announced that Morsi was under house arrest at a Presidential Guard facility where he had been residing, and 12 presidential aides also were under house arrest. The constitution, drafted by Morsi's Islamist allies, was "temporarily suspended," and a panel of experts and representatives of all political movements will consider amendments, el-Sissi said. He did not say whether a referendum would be held to ratify the changes, as customary. The armed forces announced they would install a temporary civilian government to replace Islamist President Mohammed Morsi, who denounced the action as a "full coup" by the generals. They also suspended the Islamist-drafted constitution and called for new elections. On July 4, 2013 Adly Mansour, Egypt's top judicial authority, is appointed as interim president during the transitional EFTA01143171 period. Millions of anti-Morsi protesters around the country erupted in celebrations after the televised announcement by the army chief. Fireworks burst over crowds in Cairo's Tahrir Square, where men and women danced, shouting, "God is great" and "Long live Egypt." Fearing a violent reaction by Morsi's Islamist supporters, troops and armored vehicles deployed in the streets of Cairo and elsewhere, surrounding Islamist rallies. Clashes erupted in several provincial cities when Islamists opened fire on police, with at least nine people killed, security officials said. Beyond the fears over violence, some protesters are concerned whether an army-installed administration can lead to real democracy. The ouster of Morsi throws Egypt on an uncertain course, with a danger of further confrontation. It came after four days of mass demonstrations even larger than those of the 2011 Arab Spring that toppled longtime autocrat Hosni Mubarak. Egyptians were angered that Morsi was giving too much power to his Muslim Brotherhood and other Islamists and had failed to tackle the country's mounting economic woes. President Barack Obama urged the military to hand back control to a democratic, civilian government as soon as possible but stopped short of calling it a coup d'etat. The U.S. wasn't taking sides in the conflict, committing itself only to democracy and respect for the rule of law, Obama said. He said he was "deeply concerned" by the military's move to topple Morsi's government and suspend Egypt's constitution. He said he was ordering the U.S. government to assess what the military's actions meant for U.S. foreign aid to Egypt — $1.5 billion a year in military and economic assistance. On July 5th Islamist supporters of Morsi clashed with Egyptian security forces and fought brutal street battles with Morsi opponents deep into early hours of Saturday morning, as violence surged following Wednesday's military coup. The violence left at least 36 people dead, and more than 1,000 injured across the country, according to Egypt's health ministry. Frustrated, angry civilians divided themselves into warring camps that went after each other with clubs, rocks and gasoline bombs over a major bridge and thoroughfares in central Cairo, in scenes that recalled the revolution that ousted autocrat Hosni Mubarak in 2011. So chaotic and fast-moving were events that Egyptian television news broadcasters split their screens into not just two but often three competing scenes of violent unrest. Near midnight, government troops in armored personnel carriers roared up to protect state EFTA01143172 media offices from advancing crowds of Morsi supporters. Many of them were drawn from the ranks of the Muslim Brotherhood, which suddenly finds itself shoved out of power and into a more familiar role as an oppressed opposition group. The day's turbulent developments reflect an ominously divided country, and region. From beyond Egypt, radical Web sites called for jihad against the nation's military, even as most Arab governments continued to look on approvingly of the coup. The United States has expressed concern but has generally avoided taking sides. The fact that Egypt's first democratically elected president was overthrown by the military, just one year in office by the same kind of Arab Spring uprising that brought the Islamist leader to power, present its own new set of problems for supporters of democracy here and America and around the world . As Fareed Zakaria pointed out this week in an op-ed in The Washington Post - Egypt's lost opportunity - Over the past three decades, when American officials would (gently) press Egypt's Hosni Mubarak to stop jailing his opponents and initiate more democratic reforms, he would invariably snap back: "Do you want the Muslim Brotherhood in power?" Wednesday's events suggest that Egyptians continue to face this choice, between military dictatorship and an illiberal democracy. T o succeed, the new leadership in Egypt has to find a way to reject both. That's a task for Egyptians, not for the United States. Much of the Western media has tended to describe the divide in Egypt as between secularists and Islamists, portraying ousted Egyptian President Mohamed Morsi as having pursued a radical Islamic agenda in his year in office. There is certainly a strand of truth to this narrative, though the story is more about grabbing power than enacting sharia. Morsi and the Muslim Brotherhood have been deceptive, avaricious and venal. The party promised that it would neither run for the presidency nor seek a parliamentary majority. It reneged on both pledges. It rushed through a constitution that was deficient in many key guarantees of individual rights. It has allowed discrimination and even violence against the Coptic Christian minority in Egypt. It has tried to shut down its opposition, banning members of Mubarak's old party from all political offices in Egypt for life. But its biggest failing has been incompetence. Egypt is in free fall. In the year that Morsi was in power, the economy sunk, unemployment skyrocketed, public order collapsed, crime rose, and basic social services have stalled. This would by itself by enough to produce massive public discontent. Public discontent was first channeled against the army, which ruled Egypt for 16 months after the fall of Mubarak in 2011. Now it has been directed towards Morsi. If the objective situation does not improve in the country, this discontent might not easily dissipate. Egypt's military has presented this coup as a "sot" one, aimed at restoring democracy, not subverting it. If it succeeds, it could work like the Turkish military's removal of an Islamist government in 1997. If it fails, it could look like the Algerian coup of 1992, ushering in a decade of violence. For now, it has certainly preserved the army's immense power and perks, which have continued despite the formal end of military rule. The military budget, for example, remains a black box subject to no parliamentary or presidential scrutiny. And while Morsi's misrule galvanized liberal forces, it is an irony that they have sought a path to power on the backs of a fairly repressive military regime. In Egypt, we see the results of an unfortunate dynamic produced by decades of dictatorship. Extreme autocracy produced, as its counterpoint, extreme opposition. As the regime became more repressive, the opposition grew more Islamist and obstinate, sometimes violent. Arab lands have been trapped between repressive regimes and illiberal political movements, with little prospect than that from within these two forces, liberal democracy might breakthrough. Morsi and the Brotherhood had the opportunity to break this vicious cycle — to be the force for democracy and for a liberal order with a separation of powers and a constitutional government. They overplayed their hand resulting in a popular uprising that allowed the Egyptian military to ousted them for leadership. As Zakaria pointed out in his op-ed, there is a road map to democracy. It was the one that Nelson Mandela used when he and the African National Council (ANC) took control of South EFTA01143173 Africa — he did everything in his power to accommodate and reassure the Afrikaners that they had an important place in the new South Africa. Being in South Africa at the time, the pressures on Mandela from newly empowered blacks to treat these people, who had created apartheid was immense. Yet he resisted and did what was right for his country and history. I remember asking a white South African friend at the time what he liked best about Mandela, his response was, "his generosity." The United States has tried to chart a middle course, supporting the democratic process, working with the elected president, and yet urging him toward moderation. It's not enough to satisfy either side — and where once Washington was blamed for supporting the military, it is now blamed for supporting the Brotherhood. The reality is that leadership from Washington is largely irrelevant. What matters is leadership in Cairo. Morsi is not Mandela and most likely neither is his successor. Because of that difference, Egypt will follow a more difficult democratic course than did South Africa. And if Egypt doesn't carefully navigate this balance of tolerance, inclusion,fairness along with the rule of law, thefault will be theirs alone THIS WEEK's READINGS One of the most important investigative journalist in America covering Wall Street, financial markets, big banks and big business is RollingStone's Matt Taibbi who most recently wrote another expose on malfeasance in finance titled - The Last Mystery of the Financial Crisis — exposing systemic wrong doings by the major rating agencies whose shady practices helped triggered the financial meltdown in 2008, as almost none of the fraud that swallowed Wall Street in the past decade couldn't have taken place without companies like Moody's and Standard & Poor's rubber- stamping it Thanks to a mountain of evidence gathered for a pair of major lawsuits by the San Diego-based law firm Robbins Geller Rudman & Dowd, documents that for the most part have never been seen by the general public, we now know that the nation's two top ratings companies, Moody's and S&P, have for many years been shameless tools for the banks, willing to give just about anything a high rating in exchange for cash. In incriminating e-mail after incriminating e-mail, executives and analysts from these companies are caught admitting their entire business model is crooked. "Lord help ourfucking scam ... this has to be the stupidest place I have worked at," writes one Standard & Poor's executive. "As you know, I had difficulties explaining 'HOW' we got to those numbers since there is no science behind it," confesses a high-ranking S&P analyst. "If we are just going to make it up in order to rate deals, then quants (quantitative analysts] are ofprecious little value," complains another senior S&P man. "Let's hope we are all wealthy and retired by the time this house of card[s]falters," ruminates one more. Ratings agencies are the glue that ostensibly holds the entire financial industry together. These gigantic companies — also known as Nationally Recognized Statistical Rating Organizations, or NRSROs — have teams of examiners who analyze companies, cities, towns, countries, mortgage borrowers, anybody or anything that takes on debt or creates an investment vehicle. Their primary function is to help define what's safe to buy, and what isn't. A triple-A rating is to the financial world what the USDA seal of approval is to a meat-eater, or virginity is to a Catholic. It's supposed to be sacrosanct, inviolable: According to Moody's own reports, AAA investments "should survive the equivalent of the U.S. Great Depression." It's not a stretch to say the whole financial industry revolves around the compass point of the absolutely safe AAA rating. But the financial crisis happened because AAA ratings stopped being something that had to be earned and turned into something that could be paid for. That this happened is even more amazing because these companies naturally have powerful leverage over their clients, as EFTA01143174 they are part of a quasi-protected industry that enjoys massive de facto state subsidies. Largely that's because government agencies like the Securities and Exchange Commission often force private companies to fulfill regulatory requirements by retaining or keeping in reserve certain fixed quantities of assets — bonds, securities, whatever — that have been rated highly by a "Nationally Recognized" ratings agency, like the "Big Three" of Moody's, S&P and Fitch. So while they're not quite part of the official regulatory infrastructure, they might as well be. It's not like the iniquity of the ratings agencies had gone completely unnoticed before. The Financial Crisis Inquiry Commission published a case study in 2011 of Moody's in particular and discovered that between 2000 and 2007, the agency gave nearly 45,000 mortgage-backed securities AAA ratings. One year Moody's doled out AAA ratings to 30 mortgage-backed securities every day, 83 percent of which were ultimately downgraded. "This crisis could not have happened without the rating agencies," the commission concluded. Thanks to these documents, we now know how that happened. And showing as they do the back-and- forth between the country's top ratings agencies and one of America's biggest investment banks (Morgan Stanley) in advance of two major subprime deals, they also lay out in detail the evolution of the industry-wide fraud that led to implosion of the world economy — how banks, hedge funds, mortgage lenders and ratings agencies, working at an extraordinary level of cooperation, teamed up to disguise and then sell near-worthless loans as AAA securities. It's the black box in the American financial airplane. In April, Moody's and Standard & Poor's settled the lawsuits for a reported $225 million. Brought by a diverse group of institutional plaintiffs with King County, Washington, and the Abu Dhabi Commercial Bank taking the lead, the suits accused the ratings agencies of conspiring in the mid-to-late 2000s with Morgan Stanley to fraudulently induce heavy investment into a pair of doomed-to-implode subprime- laden deals, called Cheyne and Rhinebridge. Stock prices for both companies soared at the settlement, with markets believing the firms would be spared the hell of reams of embarrassing evidence thrust into public view at trial. But in a quirk, an earlier judge's ruling had already made most of the documents in the case public. Although a few news outlets, including The New York Times, took note at the time, the vast majority of the material was never reported, and some was never seen by reporters at all. The cases revolved around a highly exotic and complex financial instrument called a SW, or structured investment vehicle. The SW is a not-so-distant cousin of the special purpose entity, or SPE, which was the main weapon of destruction in the Enron scandal. The corporate scam du jour in those days was mass accounting fraud, in which a company would create an ostensibly independent corporate structure that would actually be controlled by its own executives, who would then move their company's liabilities off their own books and onto the remote-controlled SPE, hiding the firm's losses. The SW is a similar concept. They first started showing up in the late Eighties after banks discovered a loophole in international banking standards that allowed them to create SPE-like repositories full of assets like mortgage- backed securities and keep them off their own books. These behemoths operated on the same basic concept as an ordinary bank, which borrows short-term cash from depositors and then lends money long-term in the form of things like mortgages, business loans, etc. The SW did the same thing, borrowing short-term from investors and then investing long- term on things like student loans, car loans, subprime mortgages. Like banks, a SW made money on the spread between its short-term debt and long-term investments. If a SW borrowed on the commercial paper market at 3 percent but earned 6.5 percent on subprime mortgages, that was an easy 3.5 percent profit. The big difference is a bank has regulatory capital requirements. A SW doesn't, and being technically independent, its potential liabilities don't show up on the books of the megabank that created it. So the SIV structure allowed investment banks to create and take advantage of, without risk, billions of dollars of things like subprime loans, which became the centerpiece of the