And speaking of things your government doesn't want you to know...

(Via ProPublica)

The WSJ is reporting that Bank of America has been given a "memorandum of understanding" which:

[R]equires the bank to revamp its risk and liquidity management as well as overhaul its board to have a majority of new directors.

Here's the kicker - it was ordered to do this back in May.

Here's the WSJ:

Rarely disclosed publicly, the so-called memorandum of understanding gives banks a chance to work out their problems without the glare of outside attention. Financial institutions that fail to address deficiencies can be slapped with harsher penalties that include a publicly announced cease-and-desist order.

Whereas Madoff's punishment is a media free-for-all. BofA's scolding with be handled with the utmost discretion.

Adorable.

Have gun, will travel

(Via TPM)

At last we have one: a credible reason the undisclosed CIA program wasn't shared with congress.

The finding imposed no geographical limitations on the agency's actions, and intelligence officials have said that they were not obliged to notify Congress of each operation envisaged under the directive.

NATO: Choppers on a shoestring

(Via Danger Room)

A heavy-lift helicopter, contracted by NATO, was shot down by the Taliban on Tuesday near the town of Sangin, in Afghanistan’s Helmand province. Reports indicate a rocket-propelled grenade brought down the 30-ton, Moldovan Mi-26 chopper ...the biggest operational model in the world.

...

A chronic shortage of suitable NATO choppers means the alliance contracts a large proportion of its front-line air logistics to civilian firms. When I was at the Dutch base in Uruzgan in 2007, a civilian Mi-26 was a regular visitor, alongside U.S. C-130s and Dutch CH-47 Chinooks.

British journalist Richard North points out that the destroyed chopper’s operator, Pecotox Air, has been banned from European airspace, due to safety violations — and has also been implicated in a weapons smuggling probe. The shot-down Mi-26 was reportedly hovering over Sangin to deliver “humanitarian aid,” despite major fighting in the area for three weeks now. North believes the humanitarian claim is a front — that the Mi-26 was actually delivering supplies to a British base when it was hit, but the British government wants to distance itself from Pecotox, and from the broader lack of helicopters.

The Brits are contracting with shady, private companies to get their supplies in Afghanistan airlifted...?

Makes you wonder.

Public option: a useless piece of ground

Joseph Paduda over at Managed Care Matters has a fascinating post about the much debated public plan option being offered as part of the Democrat's health care bill.

His take? As designed, the public plan will have no effect on how competitive the health care market is.

I watched HHS Sec. Kathleen Sebelieus on the Daily Show last night talk about how a public plan would have lower administrative costs and would therefore be able to put pressure on public plans to lower theirs.

It sounds good - but here's the rub according to Paduda (emphasis in original):

A public plan would begin with zero members. And zero bargaining power. The big health plans have lots of members, which is how they convince providers to agree to discount their services. Without volume, no discount.

...

The opponents of a public plan are equally confused, claiming it would damage the free market, adding unfair competition. The reality is that in most areas, there is no free market in health insurance; markets are already monopsonies.

...would a new governmental plan have an advantage over, say, Blue Cross of Alabama, which has market share ranging from 67 percent in Tuscaloosa to 95 percent in Gadsden? Or Blue Cross of Arkansas, with share from 63 percent in Hot Springs to 97 percent in Texarkana? Or the two dominant health plans in Ohio, with combined share ranging from 46 percent to 80 percent?

It wouldn't; in fact it would be an uphill climb on a very icy slope for a governmental plan to reach market parity, much less market dominance in most of the country's MSAs.

...

Yes, a governmental plan could try to force docs to accept lower fees, and physicians could and would tell the Feds to pound sand. There is precedence for this - try and find a doc who will accept Medicaid in New York. Recall the revolt of physicians last summer when they were facing a dramatic cut in Medicare reimbursement. Physicians do not have to work with any health plan - governmental or private.

Illuminating, to say the least.

Now if only someone would put these concerns to the dems in a public hearing...

(H/t to E)

Trek and Waltz

Two things:

1) To those that care - I have finally managed to see the newest Star Trek. That is all.


2) I finally managed to see Waltz With Bashir.

I don't believe I will ever see a more beautiful movie about mass murder.

Visually, this movie is more than I would have expected. People have gotten pretty good at making movie trailers - I'd argue they are usually better than the movie itself. Waltz with Bashir's trailer hits all the right notes for me: Great musical intro, arresting visuals, exotic war setting - and a bit of a mystery, defined by the filmmaker himself in the voice over:

After the 1982 invasion of Lebanon, I lost my memory. Now in order to remember, I am looking for those who can never forget.

The animation style of this movie is unlike any movie I've seen. Persepolis has a similar flow, but the realism in Bashir is really seductive. Their lighting effects, zooms and panning will doubtless show up in countless imitators. Waltz does something new - at least for me.

The story is largely based on interviews with veterans of the Lebanon war. You are introduced to a person being interviewed in the present day and then the animation gradually illustrates their story.

Lebanon was a genuine failure for Israel - and it's clear that it is haunting them in the way that national failures do. One of the roles art is truly suited for is broaching painful subjects that, brought up any other way, are too offensive to discuss. People can engage with the art, which will then withdraw until the intended topic dominates the conversation. A useful trap.

Bashir is up front about where it is headed. This is about the Sabra and Shatila massacres.

On September 16, 1982 Phalangist militias, benefiting from either Israeli aid or Israeli apathy moved into two Palestinian camps and spent three days raping and killing anyone they got their hands on.

It has become almost a cliché to describe mass murder using the phrase "killing men, women and children," but those are the only words available. And they are of course inadequate. They didn't just kill young boys, they filled alleys chest deep with them. They killed babies, young girls, and pregnant women. Estimates of the number of dead are fiercely debated but run from 300 to over 3,000.

Sabra and Shatila are the ultimate destination of Waltz With Bashir, which is only fitting. An event like that cannot be a backdrop, or mere backstory.You are going there and Bashir labors long to make the experience gripping and visually appealing. As cinematic spectacle, Bashir's many vignettes are an amazing experience.

The combat sequences have an intensity that rival Saving Private Ryan - where you wince when bullets smack the pavement.

As pure storytelling, however Bashir falters. It succeeds in luring you to the scene of an unimaginable crime - and then it leaves you there. It was likely the filmmaker's intent all along - but to simply stop at the camps makes the story seem unfinished.

Perhaps that is the larger point - but having been swept up in the rest of the film - I don't feel it was out of place to hope for more.

Worth seeing, though.

Wating on the Aftershock

Economist types keep saying we should not believe all the talk of upturn and recovery - that the looming tide of option ARM mortgages dwarfs subprime and hasn't yet hit the beach.

I've been waiting for the probing analysis of what that means. Yes, it will be bad - but presumably it will be different from subprime because the financial sector has learned how dangerous these types of loans can be. I certainly do not believe that they have learned their lesson - but presumably they will react differently to this new batch of financial detonations. Regardless of their cynical calculations, they should not be surprised this time.

This will be bad and they know it.

So, figuring out how bad this will be would seem to be a vital question. Who does it hit and how hard?

According to the WSJ - its going to beat hell out of the same boom markets: Florida and California.
CJR's Ryan Chittum observes:

So when these notes “reset” into normal ARMs where the principal has to like, you know, actually be paid off, these people are going to walk away in droves. Not only will the house be worth half what it was when the loan was signed, the loan itself will have increased in size during that time. It’s a recipe for destruction.

That covers half of the transaction - the borrowers in the boom markets should brace for another round of walkaways and foreclosures. The other half would be who owns these loans?

WSJ puts the spotlight on one lender in particular.

San Francisco-based Wells Fargo holds a mountain of Pick-A-Pays, having acquired $115 billion of the loans in its purchase of teetering Wachovia Corp., which it agreed to buy late last year.

According to Wells, those loans are worth 93.2 billion - which is already a $20 billon hit - and they claim they're handling it.

Somehow that doesn't fill me with confidence.

And is it too much to expect a higher visibility for something that could catapult us into a capital D depression?

Undisclosed Death Squads vs the Patriots-Kill-the-Bad-Guys program

The confirmation that (as should have been obvious) the Bush administration's numerous references to the surveillance program called the TSP (for "Trust us, our Surveillance is Perfectly justified") was a narrowly-parsed term designed to conceal the existence of more extensive programs has launched a new round of obfuscation masquerading as revelation.

The WSJ is quoting "former intelligence officials" as claiming that the

...Central Intelligence Agency initiative terminated by Director Leon Panetta was an attempt to carry out a 2001 presidential authorization to capture or kill al Qaeda operatives...

Marcy Wheeler doesn't buy that - and I hope she's not the only one.

Aside from the near ubiquitous drone strikes, which seem to be fully acknowledged and non-controversial, there have been enough personal strikes against al Qaeda figures that appear likely to have been assassinations, that for all intents and purposes, it appears we are assassinating al Qaeda figures.

She goes on to point out that the executive order that purports to ban assassinations can (if you believe the Bush administration) be freely ignored at the whim of the president, without altering the orignal order, or notifying anyone.

Somehow, I don't think Leon Panetta and the Dems are going to the mat over whether or not the CIA should be hunting al Qaeda. That's a little too tidy - don't you think?

Much like the TERRORIST suveilance program was advanced as a perfectly justified (never mind how often we keep hearing how many of our private conversations were hoovered up) we are now being told that the previously undisclosed initiative was intended to kill the bad guys.

Of course it was - but something tells me it isn't as cut and dried as that. Can we at long last avoid surrendering to the terms of those who wish to mislead us? Can we define something by what we know it to be, rather than what its defenders would prefer we call it?

Pretty please?

Late edit: the spin's velocity keeps increasing. Here's the AP parroting the same line (emphasis mine):

A secret intelligence program canceled by CIA Director Leon Panetta in June was meant to find and then capture or kill al-Qaida leaders at close range rather than target them with air strikes that risked civilian casualties, government officials with knowledge of the operation said Monday.

Yes, the program that was kept from Congress - caused such a flap in the DOJ - and was immediately halted by the incoming CIA director was designed to kill our enemies and save innocent life.

I'm totally buying that at face value.

Regulators: let us do our job...

...you know the one we haven't been doing.

Here's CJR's Ryan Chittum:

Getting a Consumer Financial Protection Agency passed is going to be hard enough, given how the still-extremely-powerful banking industry has vowed to fight it to the death. Now, Reuters reports that other regulators are trying to smother the agency in the cradle.

One of the only things that can rival the ferocity of a banker protecting his lucre is a bureaucrat protecting his turf. So look out.

It's a good read.

Targets wanted, will pay cash

See if you have the same reaction to this as I do:

The American and Pakistani intelligence services credit U.S. unmanned aircraft with decimating the ranks of terrorist and insurgent operatives in Pakistan. “Very frankly, it’s the only game in town in terms of confronting and trying to disrupt the Al Qaeda leadership,” CIA director Leon Panetta said in May.

But how the killer drones find their targets has been a matter of some dispute...

The Taliban are claiming that the US is paying informants to drop infrared beacons near houses where militants are located.

Here's one informant they claimed to catch:

In April, 19 year-old Habibur Rehman made a videotaped “confession” of planting such devices, just before he was executed by the Taliban as an American spy. “I was given $122 to drop chips wrapped in cigarette paper at Al Qaeda and Taliban houses,” he said. If I was successful, I was told, I would be given thousands of dollars.”

But Rehman says he didn’t just tag jihadists with the devices. “The money was good so I started throwing the chips all over. I knew people were dying because of what I was doing, but I needed the money,” he added. Which raises the possibility that the unmanned aircraft — America’s key weapons in its covert war on Pakistan’s jihadists and insurgents — may have been lead to the wrong targets.

Now, it's fair to point out that this confession was likely beaten out of this man - and that his captors have every motivation to discredit US efforts in the region - but really:

Given how badly paying bounties for Al Qaeda members played out in the past, you have to wonder: What kind of verification are they getting for these strikes?

How certain are they that their informants are targeting bad guys? At least with detainees, you get time to fix your mistakes.

(H/t Danger Room)

Least essential headlines, Vol I

Courtesy of Jen Pereira and Lee Ferran of ABC News:

Jackson's Kids Not First Famous Family to Mourn in Public - July 8, 2009

Way to jump on the public's need to know, kids.

Today only: 1 through 9

At 12:34:56 July 8, 09 (today) we’ll have the only 123456789 situation to happen for the next 100 years.

Bask in the history.

ONN gets CNN expats?

I was watching this Onion bit on the first prescription depressant for the overly cheerful:



-when I realized that the "anchor" is former CNN talking head Bobbie Battista!

Dude, hard times... although its probably better for her credibility.

He said. They said. He said back

Taibbi responds to Goldmann Sachs non-rebuttal to his previous article.

Nice.

(H/t The Big Picture)

WaPo: Fail

Talk about sh!tting yourself.

Wall Street has learned a lesson...

...and that lesson is: they can get away with murder:

Goldman Sachs employees are on pace for a $673,000 payday, according to the WSJ average of analysts’ estimates.  

According to CJR's Ryan Chittum, "that would set an all-time record."

Star Wars: The Old Republic trailer

I'm with Phil - the kids these days just don't appreciate how good they have it.

Witness the trailer for the latest Star Wars video game.

My day, we thought the drifting movement in Asteroids was impressive. I remember thinking Donky Kong on Colecovision was just amazing.

Sigh.

A public health option would destroy the free market...

...that is, if that market hadn't already been destroyed by consolidation.

Defenders of the status quo on health care like to point out that a public option will destroy the system of robust free-market competition that currently exists.

[snip]

But the notion that most American consumers enjoy anything like a competitive marketplace for health care is flatly false. And a study issued last month by a pro-reform group makes that strikingly clear.

The report, released by Health Care for America Now (HCAN), uses data compiled by the American Medical Association to show that 94 percent of the country's insurance markets are defined as "highly concentrated," according to Justice Department guidelines. Predictably, that's led to skyrocketing costs for patients, and monster profits for the big health insurers. Premiums have gone up over the past six years by more than 87 percent, on average, while profits at ten of the largest publicly traded health insurance companies rose 428 percent from 2000 to 2007.