Corporations are legal “persons,” and, like you and me, enter into binding legal contracts. One difference is, when they go bankrupt, they just “shed” their obligations and move on. You and I aren’t usually so lucky.

A case in point is extreme financial distress. For a person, this might be caused by a loss of employment, or sudden illness; for a corporation, it could be a drop in business, excessive operational costs, or bad planning. In either case: revenue is down, costs are up, and the balance sheet is negative.

If you’re a person, this kind of crisis means that you’ll suffer direct hardships: the things you own get taken away, and if you actually still earn money, your future earnings are pledged to your creditors. If you have a mortgage, you’re typically foreclosed and lose your home. Your car gets repossessed. Your belongings are sold off to pay your debts.

Ah, but if you’re a corporation, things are different! You can simply “shed” those expensive obligations and soldier on! Well, you can’t shed all your contracts – just the ones you made with your employees:

AMR [American Airlines’ parent company] was determined to avoid Chapter 11 as air travel fell and losses mounted after the 2001 terrorist attacks, even as peers used bankruptcy to shed costly pension and retiree benefit plans and restructure debt.

(Source: Bloomberg Business Week, November 29, 2011)

Of course, the obligations you made to your peers (i.e., other corporations) must still be honored. These debts will be “restructured.” But your contractual promises to pay for the doctor visits and medicine for the thousands of people who gave you 30 of the best years of their lives? Those you can “shed” like a tired skin you’ve outgrown.

“You would expect a leaner, stronger company to emerge from bankruptcy,” Chris Logan, an analyst at Echelon Research & Advisory LLP in London, said today by telephone. “As they are in Chapter 11, it will be more easy to demand concessions from the labor force.”

Ah yes, “concessions from the labor force!” In other words, the executives hold a gun to the heads of the employee unions and offer them a choice: either some of you lose your jobs and the rest lose your benefits and even more of your salary, or all of you lose your jobs and your benefits and all of your salary. Some choice.

It’s not like we haven’t been down this road before, with this very company. American’s pilots, flight attendants, mechanics, gate agents, baggage handlers – you know, the people who actually make the planes fly and keep the passengers safe – these very employees took a 30% pay cut back in 2003 in hopes of avoiding a bankruptcy proceeding. Those poor saps! Now, instead of regaining the $1,600,000,000 that they gave up eight years ago, they’re being told that they’re still earning too much, and that if they don’t make further sacrifices, they’ll all lose their jobs.

While the workers have already taken huge pay cuts, given up their pensions, and paid more in health insurance premiums, American’s executives have somehow managed to escape harm. In 2008, the same year his airline lost more than $2 BILLION the boss’s compensation package topped $5 million. But, pity poor Gerald Arpey: that $5 mil was a 22% drop over his 2007 compensation.

A quick glance at the headlines will tell you that, even through huge losses and now bankruptcy, The 1% at AMR are doing just fine: “Despite losses, American Airlines CEO’s compensation climbs” – Fort Worth Star-Telegram, Apr. 21, 2011; “Executive compensation at American Airlines raises eyebrows” – Tulsa World, April 19, 2010; “AP says Arpey earned $6.6 million in 2007” – Dallas Morning News, April 19, 2008.

Thus do the executives of the corporate entity continue to prosper and thrive, continuing to do their “jobs” of running the business, while thousands of employees are laid off, and tens of thousands more lose the only hope they had of actually being able to, you know, survive their retirement years on something other than handouts and cat food.

Although all of that can change.

God didn’t call America to do what she’s doing in the world now. (Preach it, preach it) God didn’t call America to engage in a senseless, unjust war as the war in _________________. And we are criminals in that war. We’ve committed more war crimes almost than any nation in the world, and I’m going to continue to say it. And we won’t stop it because of our pride and our arrogance as a nation.

— The Reverend Dr. Martin Luther King, Jr.

February 4, 1968

Here’s a fun fact about Libya: every one of the more than 112 Tomahawk cruise missiles launched at Libya was embossed with the Nobel Peace Prize awarded to Barack Obama! As John Pilger says, he’s America’s “First Black President to invade Africa.”

Stay tuned for more fun facts!

Today, the U.S. government is on the verge of “shutting down” over a budget impasse in the Congress. Republicans are insisting that massive spending cuts are required to avert disaster. Just today, Illinois Republican Representative Judy Biggert said, “We’re facing an economic disaster. We have to cut the spending.”

But during the Bush era, Republicans were singing a very different tune. After the 2004 elections, Dick Cheney famously said, “Reagan proved: deficits don’t matter” (according to then-Treasury Secretary Paul O’Neill). Whether or not Cheney actually said those exact words, that’s certainly how the Cheney-Bush administration behaved:

During his eight years in office, President Bush oversaw a large increase in government spending. In fact, President Bush increased government spending more than any of the six presidents preceding him, including LBJ. In his last term in office, President Bush increased discretionary outlays by an estimated 48.6 percent.

During his eight years in office, President Bush spent almost twice as much as his predecessor, President Clinton. Adjusted for inflation, in eight years, President Clinton increased the federal budget by 11 percent. In eight years, President Bush increased it by a whopping 104 percent.

[source: Spending Under President George W. Bush, Veronique de Rugy, George Mason University.]

Conservative commentators must have been outraged, right? After all, deficit spending is mortgaging our children’s future!

Turns out, not so much. Here’s the tune that the Weekly Standard was singing back in 2005:

WHEN DICK CHENEY SAID, “Deficits don’t matter,” economists took that as proof of the economic illiteracy of the Bush administration. But it turns out there is a case to be made that Cheney was onto something.

On the deepest level, the vice president was echoing, in slightly exaggerated form, an idea put forward a few years ago by Irving Kristol, the Godfather of the neoconservatives who have had such a wide-ranging effect on Bush administration policy. Kristol wrote then, and still believes, that “We should figure out what we want before we calculate what we can afford, not the reverse.”

[…]

The deficits that Bush ran up in the years in which the country was teetering on the verge of a serious recession had the beneficial effect of righting the economy. In that sense, deficits not only didn’t matter, but were a force for economic good.

[source: Do Deficits Matter?, Irwin M. Stelzer, Hudson Institute]

Something has changed in the last five years, however. For some reason… can’t quite put my finger on it… but for some reason, Republicans now fear the DOOM of deficit spending:

“There’s no daylight between the Tea Party and me. What they want is they want us to cut spending. They want us to deal with this crushing debt that’s going to crush the future for our kids and grandkids. There’s no daylight there.”

[Source: John Boehner talking to ABC’s George Stephanopolous on April 7]

I wonder if having a Democrat in the White House could possibly have anything to do with their objections?

And besides… if they’re so worried about improving the government’s balance sheet, maybe they could do something about this:

General Electric, the nation’s largest corporation, had a very good year in 2010. The company reported worldwide profits of $14.2 billion, and said $5.1 billion of the total came from its operations in the United States.

Its American tax bill? None. In fact, G.E. claimed a tax benefit of $3.2 billion.

[Source: tG.E.’s Strategies Let It Avoid Taxes Altogether, New York Times, March 24, 2011]

Nah. The Republicans would much rather shut down essential government services, fire public employees, and ensure that poor people become even more desperate for any crumbs the rich may throw their way.

In fact… isn’t that the GOP’s 2012 campaign platform?

[S]ince 1993 [Omar] Suleiman has headed the feared Egyptian general intelligence service. In that capacity, he was the C.I.A.’s point man in Egypt for renditions—the covert program in which the C.I.A. snatched terror suspects from around the world and returned them to Egypt and elsewhere for interrogation, often under brutal circumstances.

—Jane Mayer, “Who Is Omar Suleiman?”, in the New Yorker

The Cute Cat Theory of Digital Activism – Ethan Zuckerman

Blocking banal content on the internet is a self-defeating proposition. It teaches people how to become dissidents – they learn to find and use anonymous proxies, which happens to be a key first step in learning how to blog anonymously. Every time you force a government to block a web 2.0 site – cutting off people’s access to cute cats – you spend political capital.

Read the whole thing – it’s great.

Gratuitous lolcat inclusion:

John Legend and The Roots have a new album out, and one of my favorite songs is “Compared To What.” I played it for some musician friends of mine, and one of them said, “Wow, this is a lot slower than the original!”

There ensued some discussion of “the original.” One person said Common (the hip hop artist); someone else said, “I thought it was from The Seventies.” After a visit to The Google, I found a wealth of information about this interesting, important song of protest, and its circuitous pop history.

Mark Anthony Neal, a music writer and professor at Duke University, gives the best breakdown of the song’s history in a March, 2003 article for Pop Matters. He notes that, indeed, Common did record a version of “Compared to What,” with the singer Mya. But the only lyrics from the original song that remain are, “Tryin’ to make it real, compared to what?” Everything else is a rap by Common that includes lines like “the real can’t be bought or sold.”

The irony (which you knew was coming)? The rapper was remaking Eugene McDaniels’s 1960’s-era anti-war song as part of a Coca-Cola marketing campaign called “Coca-Cola…Real:”

The original version of the song is a powerful example of black pop that wasn’t afraid, echoing Audre Lorde, to speak truth to power, an element sorely missing in contemporary black pop music.

Many of the so-called hip-hop generation’s artists have been remarkably silent, while Bush, Rumsfeld, Rice, and Powell march lockstep to war with Iraq. Thus it is terribly ironic that in the midst of major antiwar protests around the world, one of the most “conscious” of hip-hop artists [Common] referenced one of the great protest recordings in the pantheon of soul music to sell brown caffeinated fizz.

[flvplayer http://www.noiselabs.com/blog/audio/mya_common_comparedToWhat.flv 400 320]

That remake of the song is particularly distasteful when you compare it to the most famous of the 60’s-era versions. You Tube user Dr. Greez had uploaded the classic recording of pianist Les McCann and saxophonist Eddie Harris doing “Compared to What” live at the 1969 Montreux Jazz Festival:

That version really cooks.

It’s interesting to hear John Legend and The Roots, who share enough of an affinity with Common that he appears elsewhere on the same album (Wake Up!), offer their take on this anti-war song. Unlike Common in the Coca-Cola ads, John Legend sings the original lyrics more or less as written. The Roots provides a much more stripped-down, slower base for the song. Overall, it’s a stirring version.

As we’re in the midst of two “overseas contingency operations” that continue to kill and maim on a daily basis, the potent protest lyrics of “Compared To What?” remain sadly relevant. John Legend, ?uestlove, and the Roots have taken a small step toward restoring the honor, and the power, of Eugene McDaniels’s original.

Have a listen below.

[audio:http://www.noiselabs.com/blog/audio/roots_what.mp3|titles=Compared to What|artists=John Legend and The Roots]

Pedro M Cruz’s visual history of European empires of the 19th and 20th centuries:

Built in Processing. More on the project HERE.

You wouldn’t expect to find such beauty in the Statistical Atlas of the United States, Based on the Ninth Census (1870) from the Library of Congress, would you? Sophisticated data visualizations, hand-calculated and hand-engraved, in beautiful colors, prepared by a staff headed by Francis A. Walker, M. A., superintedent of the ninth census.

The display above shows you, for each U. S. state and territory, the proportion of the church-going population (the colored boxes) relative to the total population (the shaded box in which the colored boxes are set), as well as the breakdown by the top 11 denominations!

I highly recommend that you check out all the charts and maps!

The problem with wind energy is that it drives prices down! From Bloomberg news:

After years of getting government incentives to install windmills, operators in Europe may have become their own worst enemy, reducing the total price paid for electricity in Germany, Europe’s biggest power market, by as much as 5 billion euros some years, according to a study this week by Poeyry, a Helsinki-based industry consultant.

Jerome a Paris has an excellent discussion of the article over at The Oil Drum. He also links from there to an excellent (and entirely wonky) discussion of the proper pricing of wind power. It is a great article – one key takeaway is that wind power actually brings electricity prices down! Understanding that assertion requires a discussion of marginal costs, initial investments, demand curves, spot pricing, intermittency, externalities, and Spitzenlast (see above), but it’s totally worth it.

Another key point is that “market” pricing actually tilts the playing field toward fuel-based generation of electricity, because of its lower capital and debt-servicing requirements:

selecting market mechanisms to set electricity prices (rather than regulating them) is, again, not technology neutral: here as well, deregulated markets are structurally more favorable to fossil fuel-based generation sources than publicly regulated price environments.

So while I definitely wanted to highlight the issues around wind power (and point you to some excellent, informed commentary), I mostly just wanted an excuse to show that graph! SPITZENLAST!