Megan McArdle: Not a great writer or economist

By Ben Cohen: The Daily Beast’s Megan McArdle is not a very good economist – or writer for that matter. Despite her impressive resume (she was a senior editor at the Atlantic and a writer for the Economist), if you try to draw logical conclusions from her confusing articles, you’d come out believing mankind had no other alternative than deregulated, trickle down capitalism. I noticed McArdle’s writing several years back, mostly because I could never understand exactly what she was trying to say, and when I did, it was abundantly clear she had no idea what she was talking about.

McArdle has a long and well documented history of Libertarian PR – so much so that it is impossible to take her seriously as a journalist. Yasha Levine and Mark Ames over at The Exiled ran a devastating piece as part of their S.H.A.M.E media transparency project detailing McArdle’s extremely murky links to the Koch brothers and her persistent defense of Wall St throughout the financial crisis. It’s worth reading in full as it uncovers a worrying trend in the US media – the promotion of PR hacks to prominent positions within respected media institutions.

A few days back, McArdle predictably waded in to the Walmart union protest debate, making a subtle defense of the corporate perspective, arguing that by paying workers more money, they would be unable to compete when it comes to offering low cost products.  She wrote:

Recessions are also a time when employers don’t necessarily have a lot of profits to give up.  Walmart’s $446 billion of revenue last year was eye-popping, but its profit margins are far from fat–between 3% to 3.5%.  If they cut that down by a percentage point–about what retailers like Costco and Macy’s have been bringing in–that would give each Walmart employee about $2850 a year, which is substantial but far from life-changing.  Further wage improvements would have to come out of the pockets of Walmart’s extremely price conscious shoppers.  Which might be difficult, given how many product categories Amazon is pushing into.

Firstly, McArdle’s assertion that $2850 is ‘far from life-changing’ is completely ridiculous. When you’re talking about workers who earn under or around $20,000 a year, $2850 is a lot of money. The extra $240 per month would make a significant contribution to groceries, childcare costs, transportation and health care costs – all expenses that the working poor struggle to balance.

Secondly, McArdle’s argument that wage improvements would have to come out of consumer’s pockets makes literally no sense given she already accepts that Walmart would still be profitable if it cut its profit margin by a percentage point. Let’s do the math with McArdle’s own figures – if Walmart is bringing in $446 billion in revenue and let’s say 3.25% of that is profit, it is still netting around $14.5 billion. I’m not sure whether McArdle is trying to say that wage increases on top of the hypothetical extra percentage point would have to come out of consumer’s pockets, but given the company would still be bringing in billions of dollars of profit, it could certainly afford to do so without hitting customers.

Of course McArdle omits mention of the corporate pay structure in Walmart – in her world the notion that management would incur modest cuts is completely unthinkable. CEO Mike Duke earns $18.1 million a year, making over 900 times what an average employee does.

What McArdle is really saying here is that workers should be grateful to be existing on wages that barely scrape past federal poverty lines (and in some cases don’t if families only have one parent working) and should understand that Walmart does not exist for their benefit, but the benefit of its CEO and shareholders. Of course this is technically correct – Walmart is legally bound to deliver maximum profit to its shareholders, making the needs of employees close to irrelevant. But then that is why unions are so important; they protect workers rights and ensure employees make enough money to feed their families.

For McArdle, these rights are frivolous luxuries that corporations can ill afford when their profit margins are at stake – even if they are still massively profitable.

I wouldn’t mind McArdle’s writing if she was honest about her motivations – to promote libertarian ideology and further the efforts to erode what is left of the labor movement in the US. But she isn’t. Her writing is deceptively masked in a light hearted, chatty style that betrays her far more cynical objectives. I’m not saying McArdle doesn’t believe what she is saying, but it’s worth noting that what she is saying has propelled her career far beyond her abilities as an economist and a writer.

McArdle can’t even be bothered to make her own numbers add up, so why she is regarded as an authority on business and economics is anyone’s guess. The truth is that there is an entire industry built around promoting an economic ideology that is mathematically impossible, and McArdle has carved a very nice niche for herself inside of it.

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Foreclosure crisis a massive crime perpetrated on the American people

By Mark Ames: Every week, it seems there’s another tragic story about a suicide or murder-suicides linked to foreclosure trauma. Some of the more spectacular murder-by-foreclosure stories the past few years have been collected by a blog called “Greenspan’s Body Count”—others, myself included, have been writing about these terrible stories of class warfare being waged by the only side fighting it, and winning it, as Warren Buffett rightly said.

Before the 2008 crisis, the media paid little attention to the death toll taken on Americans by the decades-long class warfare waged against the 99%. Now they’re impossible to ignore. Stories like the US soldier in Iraq who committed suicide so that his wife could collect life insurance, and save their family home from foreclosure. Or the courtroom-suicide in Phoenix, in which a Yale-educated banker-swindler swallowed a cyanide capsule after being found guilty of setting his 10,000 sq foot McMansion on fire as a way of collecting insurance and evading mortgage payments he couldn’t afford.

Despite the somewhat increased media attention given to these tragic stories nowadays, there is one suicide directly tied to foreclosure fraud that has been completely ignored by the media. Her name was Tracy Lawrence, and for a brief moment last year, between the moment she turned whistleblower and her untimely and bizarre suicide, Tracy Lawrence’s testimony threatened to blow the entire fraud-closure criminal enterprise wide open, with repercussions that could have easily reverberated all the way up to the major banks and GSEs complicit in one of the greatest crimes this country has ever experienced.

In the months since Tracy Lawrence was found dead in her Las Vegas apartment at the age of 43, her story has only taken on more significance—even as her death has been forgotten. This is a story that demands our attention, a story we must not allow ourselves to forget.

First, some background to Tracy Lawrence’s suicide: On November 16, 2011, the attorney general for the state of Nevada, Catherine Cortez Masto, announced a major first-of-its-kind 606-count criminal indictment against two Orange County, California-based title officers working for Lender Processing Services, the country’s largest mortgaging servicing company and the worst of the predatory “fraudclosure mills.”

Foreclosure fraud had been devastating America unabated for a few years, laying waste to untold hundreds of thousands of American families. The Nevada attorney general’s criminal case against the two LPS title officers—Gary Trafford and Geraldine Sheppard—represented, for a brief moment, the first time in years that American justice threatened the predatory lending class.

Yves Smith at Naked Capitalism was among the first to report the Nevada AG’s indictments, rightly pointing out the significance of going after mid-level officers in the foreclosure mill firm as a way of launching a full-scale takedown: “[A]s mob prosecutions have shown again and again, you start by going after the foot soldiers in the hope that they roll people higher up on the food chain. And at a minimum, this action says that the law and due process matter, and violations, particularly large scale, systematic violations, can and will be punished.”

This marked the first time that bigtime bank fraudsters faced serious jail time—Attorney General Masto’s criminal case sent shockwaves throughout the mortgage lending world. More importantly, her criminal case threatened to finally change the way America deals with the bankster class that has been plundering with impunity for years.  Politically, Nevada’s criminal indictment could have enormous repercussions; economically, the case could lead to invalidating tens upon tens of thousands of fraudulent foreclosures conducted in the Las Vegas area over the past few years.

The next day, the Los Angeles Times reported on the scale of the fraud:

In what appear to be the first criminal charges to stem from the fracas over improper foreclosures last year, two Southern California title loan officers have been indicted by a Nevada grand jury for allegedly filing tens of thousands of improper documents related to Las Vegas-area foreclosures.

The Clark County grand jury charged Gary Trafford, 49, of Irvine and Geraldine Sheppard, 62, of Santa Ana on 606 counts, alleging that the two headed up a vast “robo-signing” operation that resulted in the filing of tens of thousands of fraudulent foreclosure documents.

The documents were filed with the Clark County recorder’s office between 2005 and 2008, according to the indictment. The two title loan officers worked for the firm Lender Processing Services, a foreclosure processing company based in Florida that has been used by most of the largest banks in the nation to process home repossessions.”

Just a few months after the Nevada AG’s 606-count criminal indictment against LPS, Missouri’s attorney general filed a 136-count criminal indictment against a unit of Lender Processing Services, called Docx, as the New York Times reported last February. That meant two major criminal cases.

Given the sheer scale of the crime committed—a plundering so brutal and devastating you’d only expect such a thing from a conquering barbarian horde—what amazes me is how underreported this crime still is, and how few Americans in the Establishment know any of the details, beyond perhaps the word “robo-signing.”

One of the rare exceptions was the excellent reporting done on my friend Dylan Ratigan’s Show, as well as the unforgettable 60 Minutes segment aired last year on foreclosure fraud and “robo-signing” mills. The 60 Minutes investigation focused on the fraud perpetrated by Lender Processing Services unit, Docx, which used blatantly fraudulent “robo-signing” foreclosure documents to dispossess Americans of their homes on behalf of the Wall Street banks. Like the way peasants in a banana republic are treated, hundreds of thousands—if not millions— of Americans have been illegally and fraudulently evicted from their homes. And all the while as it happened, the Obama Administration stood by and wrung its hands—and that’s the kind, whitewashed way of putting it. Another way of looking at what the Obama Administration did with the mass foreclosure fraud crime—the true and honest way of putting it—is that the White House actively provided political and legal cover for one of the largest crimes perpetrated against Americans in modern history. The sad thing is, as horrible as the Obama Administration has been on housing, a President Romney will almost certainly find a way to be even worse, even if that worseness has to be invented. That’s one of the lessons we’ve all had to learn these past few decades.

The 60 Minutes segment zeroed in on what is now the most infamous fraudulent-signature of our time: The infamous “Linda Green”—whose signature appeared on an impossibly large number of foreclosure documents. A single fake “Linda Green” was officially listed as a “vice president” at some 20 different foreclosure mills, this same “Linda Green” signing untold thousands of fraudulent documents evicting Americans from their homes.

Among the worst of the foreclosure servicers abusing the fraudulent “Linda Green” signature was Docx, the unit of Lender Processing Services which has since been shuttered.

60 Minutes tracked down the real “Linda Green” whose name was fraudulently abused to destroy the lives of countless Americans, and it’s worth quoting what 60 Minutes found:

We went searching for “the” Linda Green and found her in rural Georgia. She told us she has never been a bank vice president.

In 2003, she was a shipping clerk for auto parts when her grandson told her about a job at a company called Docx. The company, that was once housed in Alpharetta, Ga., was a sweatshop for forged mortgage documents.

Docx, and companies like it, were recreating missing mortgage assignments for the banks and providing the legally required signatures of bank vice presidents and notaries. Linda Green says she was named a bank vice president by Docx because her name was short and easy to spell. As demand exploded, Docx needed more Linda Greens.

“So you’re Linda Green?” Pelley asked Chris Pendley.

“Yeah, can’t you tell?” Pendley, who is a man, replied.

Pendley worked at Docx at the same time and signed as Linda Green.

So you have now a sense of just how vast the foreclosure fraud crime was, and how it involved not only the largest mortgage servicer in the nation, LPS, but also all the major banks that used LPS’s services to throw Americans out of their homes illegally and take possession of them.

Let’s rewind again to last November 16, 2011, the day that Nevada’s attorney general Masto announced her indictment against the two LPS title officers—two weeks before Tracy Lawrence took her life. Nevada’s case against LPS rested primarily on the testimony of a whistleblower, Tracy Lawrence, who worked in Lender Processing Services’ office in Las Vegas. Her testimony threatened to unravel tens of thousands of fraudulent foreclosures in the state of Nevada between the years 2005-2008, and the criminal activities of the entire mortgage servicing industry. Nevada has suffered the worst foreclosure problem of any state in the union.

In return for turning state’s witness, Tracy Lawrence plea bargained her charges down to a single misdemeanor charge of falsely notarizing a signature, which carries, in the worst case scenario, a maximum of one year in prison and a $2,000 fine. However, her testimony could put her two LPS superiors behind bars for decades—which is why many believed Nevada’s goal was to turn those two LPS officers into state’s witnesses against LPS’s senior executives.

On November 29, 2011—just two weeks after the Nevada attorney general announced the landmark criminal case—whistleblower Tracy Lawrence was supposed to appear before a judge for her sentencing. It should have been a routine appearance, but she didn’t show up. Her lawyer grew anxious, called police to check on Tracy Lawrence’s home, and that’s when they found her dead.

The timing of her death was suspicious, to say the least. Immediately, before any investigation had been conducted, Las Vegas police officially “ruled out homicide” as her cause of death.

Tracy Lawrence’s suicide was given scant coverage in the national media. Here is one of the few national media stories about her death, a short piece on MSNBC’s website:

Foreclosure fraud whistleblower found dead

By msnbc.com staff

A notary public who signed tens of thousands of false documents in a massive foreclosure scam before blowing the whistle on the scandal has been found dead in her Las Vegas home.

NBC station KSNV of Las Vegas reported that the woman, Tracy Lawrence, 43, was scheduled to be sentenced Monday morning after she pleaded guilty this month to notarizing the signature of an individual not in her presence. She failed to show up for her hearing, and police found her body at her home later in the day.

It could not immediately be determined whether Lawrence, who faced up to one year in jail and a fine of up to $2,000, died of suicide or of natural causes, KSNV reported. Detectives said they had ruled out homicide.

Lawrence came forward earlier this month and blew the whistle on the operation, in which title officers Gary Trafford, 49, of Irvine, Calif., and Geraldine Sheppard, 62, of Santa Ana, Calif. — who worked for a Florida processing company used by most major banks to process repossessions — allegedly forged signatures on tens of thousands of default notices from 2005 to 2008.

Police said at the time that the alleged scam had thrown into question the legality of most Las Vegas home foreclosures in the past few years, leaving many people living in foreclosed-upon homes that they unknowingly don’t actually own.

I recently called the Clark County coroner’s office to find out if they had determined her official cause of death. A spokesperson told me that Tracy died from an overdose of Xanax (Alprazolam) and two antihistamines: Benadryl (Diphenhydramine) and Hydroxyzine. Officially, her death was ruled a suicide.

Though there has been little public discussion about Tracy Lawrence’s suicide, in private forums, her death sent a chill. Although there have been reports that Lawrence was depressed and stressed from her role as the key whistleblower, no one I know who reports on the housing disaster unquestioningly accepts the official version, that Tracy Lawrence’s suicide timing just happened to come at the most convenient time imaginable. The stakes could not have been higher: As MSNBC reported, Las Vegas police said that her testimony threatened to “throw into question the legality of most Las Vegas home foreclosures in the past few years.”

One only has to remember that Las Vegas’ gambling industry was created by mobsters like Meyer Lansky—who is also credited with helping invent modern offshore banking in the early 1930s in Switzerland. In this world, deaths ruled “suicides” are not unheard of. One of the most spectacular examples involved the “suicide” of Roberto Calvi, chairman of Italy’s largest private bank, who in 1982 was found hanging from London’s Blackfriars Bridge with bricks stuffed into his pockets along with $15,000 cash. The day before Calvi’s “suicide” his secretary “jumped” out of the bank headquarter’s fourth floor window and died—her death was also ruled suicide.

It took over two decades for authorities to overturn the “suicide” verdict and state the obvious: In 2003, Italian authorities ruled Roberto Calvi’s death a murder.

In the meantime, the fallout from Tracy Lawrence’s suicide has been worse than predictable: In Nevada, the case against Lender Processing Services appears to have all but fallen apart. With the Obama Administration foisting its foreclosure fraud settlement on all the states in January—a deal that left bankers happy, and everyone else screwed— and with the key witness to the LPS case dead, the writing was on the wall.

Masto essentially fired her deputy AG, John Kelleher, who headed up the once-aggressive Nevada mortgage Fraud Task Force. With Kelleher gone, the Task Force looks like its work is all but over, as reported in local Las Vegas Channel 8 News:

“Nevada’s mortgage Fraud Task Force — arguably among the most aggressive in the country — has undergone some dramatic changes in the last few months. The changes prompted its former chief to question whether those responsible for Nevada’s housing collapse will ever be brought to justice.”

In the report, Kelleher told Channel 8: “It’s my personal opinion that there was some kind of deal cut, involving signing the multi-state (agreement) for whatever reason: financial, political, you can speculate all day long and back off criminal.”

Along with Kelleher, several other Nevada prosecutors and investigators have since been reassigned or transferred out to pasture. In the courts, a Nevada judge all but gutted the AG’s criminal case against Lender Processing Servicers.

Over in Missouri, the state’s criminal case was recently quietly settled for a paltry sum, and forgotten about.

In a recent celebratory conference call that Lender Processing Servicers held with financial analysts, Hugh Harris, the CEO of Lender Processing, could barely contain himself as he gloated to analysts from Barcalys, Goldman Sachs and other financial institutions:

“First, let me just say we are very pleased to report strong second-quarter operating performance…we’ve gained greater clarity over the potential resolution of legal and regulatory issues related to the past practices.

“First, we announced yesterday, we’ve settled all our legal issues with the Missouri Attorney General’s office. This settlement includes a dismissal of all criminal charges filed against DocX. Second, an motion to dismiss in the Nevada Attorney General’s case was granted in part which resulted in the scope of the suit being significantly narrowed.”

So Tracy Lawrence’s highly suspect suicide is another major victory for the bankster class, and another giant loss for the rest of us. No matter what the circumstances of her suicide—that is, even if she was driven to kill herself in despair, after turning whistleblower and facing the pressure of confronting one of the biggest criminal fraud scams in history—that doesn’t make her death any less significant, or infuriating, or disturbing. Either way, the criminal lending industry drove a lone and lonely hero to her death.

All we can do for now—while this country is still controlled by a rank oligarchy— is remember Tracy Lawrence’s suicide, so that some day we can learn what drove this hero to her terrifying early grave.

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In case you missed it, here’s what we covered this week at The Daily Banter (and it was a very big week for us – highest traffic so far!): Mark Ames broke a big story on the Left’s total abandonment of labor rights, Chez Pazienza wrote a heart breaking piece on the merciless bullying of a 68-year-old widow to the point where she cried, and profiled MSNBC’s new vacant conservative host, Bob Cesca drew comparisons between the months leading up to President Clinton’s impeachment and what is happening to Obama, and contrasted the Republican’s treatment of women saying ‘vagina’ and conservatives shouting at the President. We also looked at the poverty epidemic the media refuses to cover, and argued that President Obama is still a major force for progressive politics despite his many flaws.

Have a great weekend!

Ben Cohen, Editor

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Aryeh Neier: Labor Rights separate from Human Rights (Photo credit: IWHC)

By Mark Ames: Progressive intellectuals have been acting very bipolar towards labor lately, characterized by wild mood swings ranging from the “We’re sorry we abandoned labor, how could we!” sentiment during last year’s Wisconsin uprising against Koch waterboy Scott Walker, to the recent “labor is dead/it’s all labor’s fault” snarling after the recall vote against Gov. Walker failed.

It must be confusing and a bit daunting for those deep inside the labor movement, all these progressive mood swings. At the beginning of this month, New York Times’ columnist Joe Nocera wrote a column about having a “V-8 Moment” over the abandonment of labor unions, an abandonment that was so thorough and so complete that establishment liberals like Nocera forgot they’d ever abandoned labor in the first place!

The intellectual-left’s wild mood swings between unrequited love towards labor unions, and unrequited contempt, got me wondering how this abandonment of labor has manifested itself. While progressives and labor are arguing, sometimes viciously, over labor’s current sorry state, one thing progressives haven’t done is serious self-examination on how and where this abandonment of labor manifests itself, how it affects the very genetic makeup of liberal assumptions and major premises.

So I did a simple check: I went to the websites of three of the biggest names in liberal activist politics: Amnesty International, Human Rights Watch, and the ACLU. Checking their websites, I was surprised to find that not one of those three organizations lists labor as a major topic or issue that it covers.

Go to Amnesty International’s home page at www.amnesty.org. On the right side, under “Human Rights Information” you’ll see a pull-down menu: “by topic.” Does labor count as a “Human Rights topic” in Amnesty’s world? I counted 27 “topics” listed by Amnesty International, including “Abolish the death penalty”, “Indigenous Peoples”, “ “Children and Human Rights” and so on. Nowhere do they have “labor unions” despite the brutal, violent experience of labor unions both here and around the world. It’s not that Amnesty’s range isn’t broad: For example, among the 27 topics there are “Women’s rights”, “Stop Violence Against Women” and “Sexual Orientation and Gender Identity”. There’s even a topic for “Business and Human Rights”—but nothing for labor.

Puzzled, I called Alex Edwards, Amnesty’s Media Relations guy in Washington DC, to ask him why labor unions didn’t rate important enough as a “topic” on Amnesty’s “list of topics.” Edwards was confused, claimed that he was totally unaware that there was a “list of topics” on Amnesty’s home page, and promised to get back to me. I haven’t heard back from him.

Next, I checked Human Rights Watch. From my experience in Russia and Eastern Europe, I’ve learned to expect less from HRW than I would from Amnesty—my memory of HRW during the Kosovo conflict and in others is that, when called to, HRW acts as a propaganda arm for the liberal hawk war party. But HRW has also done a lot of important good work in areas not covered by the press, and they’re certainly better than most—so does Human Rights Watch consider labor unions an important human rights issue?

Checking Human Rights Watch’s homepage (www.hrw.org), there’s a tab listing “topics”—14 topics in all. Once again, labor is not listed among Human Rights Watch’s covered “topics.” Instead, Human Rights Watch lists everything from “Children’s Rights” to “Disability Rights” to “LGBT Rights” and “Women’s Rights”—along with “Terrorism”, “Counterterrorism” and, I shit you not, “Business”—as vital human rights topics. But not labor. “Business”—but not “Labor.”

On the advice of an old friend, Jan Frel, I read an excellent book on the human rights industry, James Peck’s “Ideal Illusions,” which helps answer why labor rights have been airbrushed out of the language of human rights. It wasn’t always this way: Economic rights and workplace rights were for decades at the very heart of the human rights movement. This was officially enshrined in 1948, when the United Nations adopted a 30-point “Universal Declaration of Human Rights” putting labor rights and economic equality rights alongside those we’re more familiar with today, like freedom of expression, due process, religion and so on. But somehow, labor rights and economic justice have been effectively amputated from the human rights agenda and forgotten about, in tandem with the American left’s abandonment of labor.

In Peck’s history, Human Rights Watch stands out as a force for rank neoliberalism, a major player in the extermination-by-omission of labor rights and economic equality rights from the language of human rights. How this happened sheds at least a bit more light on how the left abandoned labor.

Aryeh Neier, founder of Human Rights Watch and its executive director for 12 years, doesn’t hide his contempt for the idea of economic equality as one of the key human rights. Neier is so opposed to the idea of economic equality that he even equates the very idea of economic equality and justice with oppression—economic rights to him are a violation of human rights, rather than essential human rights, thereby completely inverting traditional left thinking. Here’s what Neier wrote in his memoir, Taking Liberties: “The concept of economic and social rights is profoundly undemocratic… Authoritarian power is probably a prerequisite for giving meaning to economic and social rights.”

Neier here is aping free-market libertarian mandarins like Friedrich von Hayek, or Hayek’s libertarian forefathers like William Graham Sumner, the robber baron mandarin and notorious laissez-faire Social Darwinist.  As with Neier, William Graham Sumner argued that liberty has an inverse relationship to economic equality; according to Sumner, the more economic equality, the less liberty; whereas the greater the inequality in a society, the more liberty its individuals enjoy. It’s the fundamental equation underlying all libertarian ideology and politics—a robber baron’s ideology at heart.

Neier goes further, explicitly rejecting the Universal Declaration of Human Rights because nine of its 30 articles focus on economic rights as human rights. Neier objects to that, singling out for censure “such economic issues as a right to work; to social security; and to an adequate standard of living.” The human rights article on “a right to work” that Neier dismisses as “authoritarian” is Article 23, and it reads:

“Article 23 (1) Everyone has the right to work, to free choice of employment, to just and favourable conditions of work and to protection against unemployment. (2) Everyone, without any discrimination, has the right to equal pay for equal work. (3) Everyone who works has the right to just and favourable remuneration ensuring for himself and his family an existence worthy of human dignity, and supplemented, if necessary, by other means of social protection. (4) Everyone has the right to form and to join trade unions for the protection of his interests.”

It’s interesting that Neier rejects Article 23, the article on labor, which he mislabels as “a right to work”, because back in the 1970s, when Neier was executive director of the ACLU, he supported big business’s “Right To Work” anti-labor laws, against the rest of the left and the ACLU, which at the time still supported labor rights as civil rights. The so-called “Right To Work” laws are grossly misnamed—they’re really laws designed to bust unions by making it even more difficult for them to organize worker power against the overwhelming power of the corporation. It was corporate PR flaks hired to deceive and conceal the real purpose of those laws who came up with the false name “Right To Work” laws. Fred Koch, father of Charles and David Koch and one of the founders of the John Birch Society, got his start in rightwing politics as a leader of the “Right To Work” movement in Kansas in the mid-1950s.

Less than twenty years after Fred Koch fought to destroy labor rights through “Right To Work” laws, the executive director of the ACLU, Aryeh Neier—the same Aryeh Neier who later led Human Rights Watch— colluded with William Buckley to push the ACLU rightward against labor by getting the ACLU to represent big business and “Right To Work” laws, under the guise of “protecting free speech”—the same bullshit pretense always used by lawyers and advocates to help big business crush labor and democracy. This “free speech” pretense is the basis on which the ACLU currently supports the Citizens United decision, which effectively legalized the transformation of America into an oligarchy.

I found an article from 1971 written by William Buckley in which the National Review founder praises Neier for working with him to turn the ACLU against labor: “I invited the ACLU to practice consistency by associating itself with a lawsuit which would prove unpopular among its labor union supporters,” Buckley wrote. “The executive director, Aryeh Neier, has replied, rather straightforwardly, I think. He says, ‘for many years, it has been the ACLU’s policy that the union shop does not, by itself, violate civil liberties. I have felt for some time that we should review this policy and I will use your request to initiate reconsideration,’ going on to say that it will take a while to canvass the directors.”

A few years later, Buckley boasted of his first early success in turning the ACLU against labor, citing not just his ally Aryeh Neier, but also another well-known name in the so-called “left,” Nat Hentoff. Buckley wrote in 1973:

“Meanwhile, Mr. Nat Hentoff, a left-winger of undiluted loyalty to the first amendment, has urged his very important constituency to side with me and with Evans [M. Stanton Evans, an early libertarian and longtime defender of Joseph McCarthy] and has attempted to persuade the American Civil Liberties Union to file a brief amicus curiae. He has almost singlehandedly persuaded the ACLU to change its historic opinion about union membership. The union shop, the ACLU now says belatedly, ought not to be required for people who are journalists.”

The lawsuit Buckley refers to, Buckley and Evans vs. AFTRA, was backed by the National Right To Work Legal Defense Foundation, the legal arm of the notorious union-busting outfit of the same name. And “leftist” Nat Hentoff. People used to think Hentoff was a leftist—and he seemed like one to de-politicized Baby Boomer imbeciles, who figured the Village Voice label on Hentoff’s columns meant whatever he said was leftist. Today, Hentoff is finally in his ideological home at the Cato Institute, the Koch brothers’ anti-labor, pro-oligarchy libertarian think-tank. Despite the Cato Institute’s tireless efforts to undermine democracy and labor, many progressives today consider Cato as “left” or “progressive”—a perversion only possible in today’s mutant left, stripped of its historical relationship to labor and economic justice.

The ACLU under Aryeh Neier also allied with another Buckley in another key decision that hurt labor and democracy and helped the oligarchy: Buckley v Valeo in 1976. Neier was the ACLU head at the time that the ACLU sided with William Buckley’s brother, James Buckley, in a lawsuit to open up the money floodgates into American politics. Most people don’t know Neier’s role in moving the ACLU against labor and against egalitarianism—instead, he did a lot of cheap grandstanding on behalf of Nazi marchers in Skokie. That’s the sort of pseudo-politics and pseudo-bravery that, stripped of economic politics and labor politics, results in the pseudo-left of today, a left absorbed by “identity politics” at the expense of labor, egalitarianism and socio-economic justice.

And that brings me to the ACLU today—the most depressing part of this story. I had an inkling that the ACLU had abandoned labor before my simple exercise check of their website. Mike Elk has shared with me some of his research into this subject. And it’s well known that the ACLU vigorously supported the disastrous Citizens United decision; the ACLU also took $20 million dollars from the Koch brothers, whose libertarian outfits have played a major role in making Citizens United a reality. Supposedly that money was meant to “fight the Patriot Act”—which is odd, considering that the director of the Koch brothers’ Center for Constitutional Studies at Cato and Vice President for Legal Affairs at Cato, Roger Pilon, explicitly supported the Patriot Act from 2002 through 2008, and that the Kochs’ Cato Institute hired John Yoo to serve on their editorial advisory board for the Cato Supreme Court Review. One should be skeptical when it comes to Koch “donations” sold to the public as charity work in the service of human rights.

Maybe there’s no connection there whatsoever between the Kochs’ $20 million gift to the ACLU, and the ACLU’s advocacy for the Kochs’ pet political issue, Citizens United, which transferred greater power from democracy and into the hands of billionaire oligarchs like the Kochs. Maybe it’s all a coincidence, I don’t know. But we do know that there is precedent for the ACLU taking money from corporations, advocating their cause under the guise of “protecting free speech” and hiding the conflict of interest from the public in order to make their defense seem more convincing.

In the late 1980s and early 1990s, the ACLU vigorously defended the interests of the tobacco lobby under the guise of protecting their “first amendment rights”—and they did it for payments in-kind. Leaked tobacco documents in the 1990s exposed the ACLU working out explicit deals with the tobacco industry to take their money in exchange for advocating their interests in public, without disclosing that gross conflict of interest and violation of the public trust. The documents and memos revealed that the hundreds of thousands of dollars paid to the ACLU by the tobacco companies were payments in kind to for the ACLU’s defense of Big Tobacco, a relationship that both parties tried to hide in order to confuse the public into believing that the ACLU’s arguments for tobacco were motivated by purely altruistic constitutional arguments, rather than sleazy under-the-table cash payments. The ACLU is, after all, a trusted institution among progressives—that made them the ideal “Third Party Advocate” in PR terms for the tobacco industry’s interests.

One of the best accounts of the ACLU’s sleazy relationship with big tobacco comes from former Washington Post investigative reporter Morton Mintz, in his piece, “The ACLU and the Tobacco Companies,” published in Harvard University’s Nieman Reports. Mintz reported how the ACLU laundered the tobacco lobby’s money as supposedly charity money to fight for workplace rights. This abuse of public trust so outraged former ACLU legal director, Melvin Wulf, that he publicly denounced the ACLU’s rationalization as a “sham” — the ACLU worked with tobacco to fight against second-hand smoke laws, the very opposite of “workplace rights”:

“The justification that the money is used to support workplace rights is a sham. There is no constitutional right to pollute the atmosphere and threaten the health of others. The revelations…support the conclusion that the ACLU’s mission is being corrupted by the attraction of easy money from an industry whose ethical values are themselves notoriously corrupt and which is responsible for the death annually of 350,000 to 400,000 persons in the U.S. alone.”

So it should come as no surprise that on the ACLU’s website, on the page marked “Key Issues” — labor does not appear. Not among the 14 categories of ACLU “Key Issues” — which include “HIV/AIDS”, “LGBT Rights”, “Technology and Liberty” and “Women’s Rights”. Not even among the 90 sub-categories of “Key Issues” is there a single mention of “labor rights.”

Everything under the civil liberties sun but labor rights and economic/social equality are named as ACLU “key issues.” Among the 90 sub-categories: “Marijuana Law Reform”, “Flag Desecration”, “LGBT Parenting”, “Medical Care in Prison” and “Mental Care In Prison” [separate sub-categories], “Biological Technologies”, “Internet Privacy”, and “Sex Education.” All of these certainly qualify as key issues to progressives; but the list of categories, 114 in all, without a single mention of labor unions, let alone economic equality or even the very word “equality”—provides a grim and shameful picture of a left stripped of labor, stripped of economic egalitarianism. It is not a left at all: It is, alas, libertarianism. The left was born of labor struggles and the fight against oligarchy and for egalitarianism, economic justice and equality. Now there isn’t even a memory of that.

Stunned by the fact that the ACLU didn’t even include “labor” or “equality” among the 114 “key topics” listed, I called and then wrote to the ACLU asking for comment.

Here is the response I received from Molly Kaplan, the media relations liaison at the American Civil Liberties Union:

Hi Mark,

Labor rights are certainly a key issue for the ACLU; it is folded into our work for free speech, immigrants’ rights and women’s rights. If you look into the pages for those issues, you will find that labor rights have a presence. Let us know if we can be of any further assistance.

Cheers,

Molly

Well, at least someone has labor rights.

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Exclusive: Sgt. Robert Bales stands accused of murdering 17 Afghan civilians, a crime that some trace to the financial pressures his family faced back home. However, to the rich financial swindlers, the ruining of Bales’s family – and many others – is just another day’s work, writes Mark Ames.

——

By Mark Ames: This past Thursday, a Modesto, California, man whose house was in foreclosure shot and killed the Sheriff’s deputy and the locksmith who came to evict him from his condominium unit. Modesto authorities responded by sending 100 police and SWAT snipers to counter-attack, and it ended Waco-style, with the fourplex structure burning to the ground with the shooter inside.

It’s not surprising that this should happen in Modesto: Last year the Central California city’s foreclosure rate was the third worst in the country, with one in every 19 properties filing for foreclosure.  The entire region is ravaged by unemployment, budget cuts, and blight — the only handouts that Modesto is seeing are the surplus military equipmentstocks being dumped into the Modesto police department’s growing arsenal.

The shooter who died was 45 years old and he appears to have lost his condominium over a $15,000 home equity loan he took out almost a decade ago, owed to Bank of America. The condo was sold at an auction for just $12,988 to a shady firm, R&T Financial, that doesn’t even have a listed contact number. Too much for the former security guard, who barricaded himself in the condo which had been in the family for decades. He refused to walk out alive.

These “death by foreclosure” killings have been going on, quietly, around the country ever since the housing swindle first unraveled. Like the story of the 64-year-old Phoenix man whose daughter and grandson were preparing to move in with him after losing their home to foreclosure — only to get a knock on his door surprising him with an eviction notice on the house he’d owned for over 30 years. Bank of America foreclosed on him despite his attempts to work out a fair plan.

We now know that the same banks that had been bailed out over their subprime fraud disaster were, by the time this happened, headlong into another criminal scheme, this time foreclosure fraud. The fraud was effected both illegally and in bad faith on a scale so vast it’s hard not to think that it was carried out by some marauding foreign army.

Anyway, the old man grabbed a .357 and a beer, walked outside into a sea of Phoenix cops and snipers, and fired his gun off until they cut him down in a hail of bullets.

Sometimes the “losers” in this class war make it easier on everyone else by killing themselves and setting themselves on fire as they’re being evicted, as one Ohio couple recently did. Others class war “losers” aren’t as cooperative, like a Florida man who was gunned down by police after he set his foreclosed townhouse on fire last year.

It’s exactly the sort of lopsided class war that Warren Buffett first officially acknowledged in 2006: “There’s a class war, all right, but it’s my class, the rich class, that’s making war, and we’re winning.”

Buffett is right to call it a one-way war, in both a metaphorical sense and in a literal sense, given the endless wars being waged for over a decade now, wars that are tied to the class wars at home.

Murdering Afghan Civilians

Nothing illustrates the interlinking between the class war at home and the imperial wars abroad more starkly than the example of Staff Sgt. Roger Bales, the Army sniper accused last month of killing 17 Afghan civilians, mostly women and children.

The Army is trying to pin it all on Sgt. Bales’s supposedly deranged mental state, but their version of events contradicts what the victims and eyewitnesses in the village have been telling the few reporters who have had a chance to actually interview them. They’re saying that they saw several American soldiers participating in the massacre, as well as a helicopter.

Whatever the case, whether alone or with others, most people familiar with the case agree that for some reason, Sgt. Bales “snapped.”  Invariably they’re over-psychologizing why he “snapped” — the military has blamed it on everything from his supposedly troubled marriage, to strain or stress, to an alleged alcohol bender.

Less well-known or discussed is what happened to Sgt. Bales on the other front: the class war front. Three days before his shooting rampage, the house where Bales’s wife and two children lived in Tacoma, Washington, put up for a short sale, $50,000 underwater. This was exactly what Sgt. Bales and his wife feared might happen if the Army forced him into a fourth battlefield deployment.

The last time Sgt. Bales deployed — to Iraq in August 2009 — Bank of America foreclosed on the family’s rental property, a duplex that his wife had bought in 1999 that was also underwater. Within months of BofA taking their duplex, Sgt. Bales’s Humvee hit an IED and flipped over, causing brain and head injuries. On a previous deployment to Iraq, Sgt. Bales had one of his feet partially blown off by a bomb.

Before being deployed to Afghanistan last year, he and his wife had been assured that the Army wouldn’t force Sgt. Bales, a highly-decorated hero who’d already sacrificed his physical wellbeing and his family’s financial health, back into combat.

Bales and his wife were planning their future as a career military family, on bases far from any combat zone, working up the Army’s pay scale year by year. But then in March 2011, a year before Sgt. Bales’s massacre, they were shocked and hurt by the Army’s decision to deny him his standard promotion to Sgt. First Class, which came with a much-needed pay hike.

(Last year, President Barack Obama’s Joint Chiefs of Staff chairman, Adm. Michael Mullen, said many of the austerity cuts would fall on soldiers’ pay and benefits rather than slashing weapons programs and force levels, which he called the “relatively easy” thing to do.)

When Sgt. Bales learned he wouldn’t get his promotion, his wife wrote on her blog: “It is very disappointing after all of the work Bob has done and all the sacrifices he had made for his love of his country, family and friends.”

Kathilyn Bales comforted herself with the assurances they’d been given that at least her husband wouldn’t be sent back into combat again — at least the family would be going together to one of the many non-warzone bases around the world. She wrote: “Who knows where we will end up. I just hope that we are able to rent out the house so we can keep it. I think we are both still in shock.”

Then came the real shock: the Army sent Sgt. Bales back into the war zone, into Afghanistan. His wife would have to deal with the more than $500,000 in mortgage debts on her own.

It was all timed perfectly: Last December, the month Sgt. Bales was deployed to Afghanistan, one of the subprime loans worth $178,000, taken out in 2006, was timed to “reset” to as high as 10.8 percent interest, and call in its first full payment.

Joe Krumbach, former president of the Seattle Mortgage Bankers Association, reviewed this loan and the others sold to Sgt. Bales’s wife while he was in Iraq, and denounced them as “unconscionable.”

He told the Seattle Times, “The margins on these loans are disaster waiting to happen” and admitted that mortgage lenders deliberately targeted military families like the Bales family, swindling them into signing onto far pricier refinancing loans “that benefited lenders and mortgage brokers” at the expense of vulnerable military families, as well as minorities and low-income borrowers.

Another local real estate businessman who specializes in short sales agreed, telling Businessweek that “we set them up.”

“It’s not an unfamiliar story, but it’s sad,” said Richard Eastern, a co-founder of Bellevue, Washington-based Washington Property Solutions, which negotiates short sales. “We’re going to send you off to war but we’re going to foreclose on your home.” He said many lenders offered loans they knew borrowers couldn’t repay. “And it’s not just soldiers, it’s everybody. We set them up.”

The extent to which mortgage lenders and banks deliberately preyed on American military families is made clear by this little-known fact: the Tacoma region, home to Fort Lewis-McChord, the largest base in the Western United States and home to 100,000 military personnel and family, suffered one of the worst predatory subprime loan epidemics in the country, an anomaly in the state of Washington. According to Richard Eastern’s firm, roughly half of all home sales in that region are either foreclosures or short sales. As early as 2007, the Wall Street Journal singled out Tacoma as one of the nation’s worst affected regions from subprime plunder.

Who’s at Fault?

So who did this? Who, in the class war equation, waged and “won” this class war on Sgt. Bales’s family, and so many other military families? What are their names? Where are they now?

As a matter of fact, there is a name: Paramount Equity Mortgage. And there is a name: Hayes Barnard, the CEO and co-founder of Paramount Equity. He lives in Roseville, California. In many ways, the story of the “winner” in this class war story is the most revealing, and enraging part of all.

Paramount Equity was founded in 2004, and quickly spread across the Western states, issuing some $8 billion in loans. Paramount Equity’s subprime predation really took off in 2006, right after the Bush Administration’s Department of Housing (HUD) and the FHA qualified Paramount Equity government insurance on its mortgages.

Almost immediately, Paramount Equity flooded the Tacoma region’s radio airwaves with deceptive ads hard-selling refinancing loans, featuring the voice of CEO Hayes Barnard promising the lowest rates, the most honest dealing, giving his personal guarantee.

However, a raft of fraud and deception charges followed. In 2008, the Washington State Department of Financial Institutions announced it was charging Paramount Equity Mortgage with deceptive lending practices and revoking its license.

Paramount stood accused of charging and collecting unearned fees, charging consumers to buy down interest rates without actually reducing the rate, failing to make required disclosures and making state and federally-required disclosures in a deceptive manner.

“Paramount failed to make proper disclosures in almost every loan we reviewed,” said Deb Bortner, director of DFI’s Division of Consumer Services. “Washington [state] has many licensed mortgage brokers who comply with the law. In today’s market, we simply do not need a mortgage broker engaged in deceptive conduct doing business in this state.”

The state’s charges also singled out Hayes Barnard for “engaging in a deceptive advertising campaign.”

As is so often the case, there’s far too little reported specifics on the actual nature of the fraud and deception. Sometimes you have to look in the comments sections on real estate or legal blogs from the affected region. Like this comment left on a marketing blog posting calling out Paramount Equity’s “lies”:

“I apologize if this is maybe a little off topic. I refinanced with Paramount back in 2004. Come 2009, my loan adjusted and I was left with no choice but to walk away with my 3 kids and stay at home wife. I had to rely on credit cards the last couple of years, even charging a couple mortgage payments.

“We ended up filing ch. 7 and we are now renting and have ZERO (if not worse) credit. Today (Sept. 27, 2011) an auditor came to my door and gave me some info and verified other info regarding B-of-A filing a PMI [private mortgage insurance] claim. Sorry so long winded….

“One of the docs he showed me was of my stated income which was double …  DOUBLE my income at the time. I NEVER would put myself into such a situation and lied. I honestly believe the number was changed and it was burried [sic] in an inch of docs I had to sign and I just didn’t see it.

“I’m not claiming complete innocence, because after all, I DID sign everything and agreed to the loan (which I didn’t know was a negative amortization loan. Hell, I didn’t even know what that meant). Now, we’re stable, but my financial future and creditworthiness is screwed. I barely got a $500 limit credit card at 17%.

“Do I have any type of recourse here? I’m not frivolous, but I am at a loss. In fact … I LOST everything. Thanks in advance.”

These sorts of stories can be found everywhere, and they repeat themselves over and over. And what’s most galling of all is that these plundering crooks preyed on those most vulnerable — military families suffering from the chaos of war, minorities, low-income people — to generate their fast riches, backed with government guarantees.

Getting Off Easy

For all the swindling and destruction, including the “unconscionable” exploding loans Paramount Equity foisted on Sgt. Bales’s wife while he was off fighting in Iraq, the state of Washington settled in 2009 with what can only be described as a wrist-massage: A fine of a mere $392,000, no admission of guilt.

Paramount even got to keep its license to operate. This, despite the incredible admission in the signed consent that “Paramount admits that during the relevant time period, Paramount did not maintain books and records.”

This is what a lopsided class war looks like: The financial fraudsters, the One Percenters, fleece the unsophisticated locals like 19^th century Europeans plundering far-away aborigines.

One victim of Paramount commented bitterly on the settlement:

“We have not one, but TWO ugly loans which are breaking us from good ol’ Paramount Equity Mortgage. …. The citizens who signed these toxic documents are suffering EVERY DAY and losing their homes because Matt and Hayes need to make their yacht payment.

“Our financial lives, that took 30 years to build, have been crushed because of the deception that occurred in their office (where no employee appeared to be over 40 years of age) I remember asking at the closing table, ‘Does anyone have gray hair in this building??!!’ It was unnerving. The parking lot looked like a BMW Sales Lot. …

“Soon, I intend to stop crying about our mortgages, as I have been doing over the last THREE YEARS… And Washington State Department of Financial Institutions: SHAME ON YOU. Shame on you.”

Two “ugly loans” from Paramount Equity are what broke Kathilyn and Roger Bales.

The end result: Hayes Barnard and Paramount Equity Capital are doing better than ever. In 2009, Hayes Barnard was named “Entrepreneur of the Year” by the Roseville Chamber of Commerce, the wealthy Sacramento suburb where Paramount Equity Mortgage is headquartered. In 2010, the Sacramento Business Journal honored him as one of Sacrament’s “40 under 40” leaders.

The big payoff came last year, when one of the world’s largest infomercial firms, Guthy-Renker, bought a “significant equity position” in Hayes Barnard’s company. You might know Guthy-Renker as the company that makes all those annoying Tony Robbins infomercials and Susan Lucci skincare infomercials.

Guthy-Renker’s also owns an equity stake in RealtyTrac, the leading foreclosure intelligence source. That’s good news for Hayes Barnard, because it means he’ll be able to wet his beak on the aftermath of the subprime plunder by getting first dibs on the best foreclosure deals. It’s a win-win.

In this degenerate 21^st Century version of America, Hayes Barnard exemplifies everything that the current system rewards. In the anti-meritocracy we live in, the sociopaths and crooks are the “winners.” Being a “winner” means you get quoted adoringly in a Sacramento Business Journal Q&A, spouting out the blackest of unintentional black humor:

“As a younger professional, what is the biggest challenge you face?

“As a young professional, the biggest challenge I face is finding the right balance between raising my three children all under 3 years old, being a supporting husband and leading my team as a CEO of three companies. … Achieving true success is to give, give, give and help as many people as you can while leading for your family, employees and community.”

That’s how the class war “winners” rub it in on the rest of us — especially their victims. How can you function after reading such self-serving drivel, particularly if you’re one of the victims?

As for the “losers” in this class war: Sgt. Roger Bales’s wife and children are ruined. They have no home; they only own debts to the tune of hundreds of thousands of dollars, debts owed for life to the Hayes Barnards of this country. The “winner” — the swindler — is a community hero.

As for Sgt. Bales – whom the Army accuses of “snapping” for no good reason, accusing him of being a drunk, or of mental weakness, incapable of handling his marriage or the stress of combat – he might even be put to death. He now sits in Fort Leavenworth military prison, charged with the murder of 17 Afghan civilians.

The way the One Percenter “winners” see this story, it’s all proof that the system is working perfectly.

As the National Journal reported, “Nearly all of National Journal’s National Security Insiders agree that the military justice system can conduct a fair trial for Staff Sgt. Robert Bales.”

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Exclusive: Work-place and college-campus slaughters have become a regular feature of America’s harsh economic landscape the past few decades, as Ayn Rand-style policies sharply divide the nation into a few heroic “winners” and many hapless “losers,” a factor Mark Ames examines in the latest college bloodbath.

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I was working on an article about last month’s rampage massacre in Afghanistan that left 17 villagers dead, when news hit of this past Monday’s massacre at an Oakland, California, religious college, leaving seven dead. In both cases, the shooters survived and face a possible death penalty — which is rare: Usually these rampage killings end with self-inflicted bullet in the mouth.

These “going postal” rampage killings like the one that just took place at the Oikos University campus so often and with such relentless rhythm, a lot of people might easily assume that these mass-shootings at American schools and workplaces have always been with us.

Accused mass murderer One L. Goh (Photo from Alameda County Sheriff’s Office)

It’s not true, of course — as I wrote in my book Going Postal: Rage, Murder and Rebellion — it’s an exclusively American phenomenon specific to our time. The first post office rampage killing took place in Edmond, Oklahoma, in the mid-1980s, at the height of the Reagan Revolution’s war on the American worker.

Those post office massacres quickly migrated into private workplace massacres by the end of the 1980s, where they’ve become a regular rhythmic staple of our murder culture ever since – and from the adult workplace, the massacres migrated to our schools.

We’ve had mass-killings before; and every now and then, you’ll read about a rampage killing in some other country. But only in America, and only since the mid-1980s, do American employees attack their own workplaces and offices, and middle-class students attack their own schools, with such consistency, year after year.

It was only after the crash in 2008 that some Americans began to accept the obvious: That the cruelty, predation and concentration of wealth and power introduced by the Reagan Revolution sparked a new type of murder that has more in common with insurgency violence or rebellious peasant violence than, say, the psychopathology of a serial murder.

Like so many school rampage killers, last Monday’s alleged murderer, One L. Goh, was reportedly bullied and mistreated at his nursing school program at the small Korean Christian nursing program he enrolled in. Bullying also was blamed for the high school rampage killing a few weeks ago in suburban Cleveland that left three students dead and five wounded.

The gruesome details about the way Goh is said to have lined up and executed his victims, the way he apparently singled out women, make hard not to caricature him as a monster, a demonic psychopath — and yet, without excusing Goh’s killings, one should try to make sense of what happened to him, the downward-trending bleakness, the slow water-torture of low-five-figure debts, the broken marriage, the $23,000 tax bill owed to the IRS.

Losing Hope

In the Naughts, One L. Goh helped run a construction company. But construction collapsed as an industry in 2006-7; and unless you were Countrywide Financial CEO Angelo Mozillo, you’d have nothing to show for the few good years.

In late 2007, Goh moved into the Yorkview Apartments complex in Hayes, Virginia — a bleak, prefab looking structure in a rural corner of Virginia. By the following summer, One L. Goh found himself unable to cover his $575 rent payment two months in a row. He was evicted; but before they evicted him, creditors took his car

The future rampage-murderer took it all stoically, even politely, according to one of Goh’s apartment complex neighbors, Thomas Lumpkin. Goh “was always neat, wore nice clothes,” Lumpkin said. “You would never expect it out of him. He just don’t seem like that type of person.”

Lumpkin also recalled the day Lumpkin was evicted, saw his Nissan pickup repossessed and departed by cab. I tried to imagine what that cab ride felt like for One L. Goh, a pudgy 40-something Korean-American dweeb, stewing with resentment, in his nice neat clothes. How far did he go in that cab — and where to?

Eventually he wound up with his father on the West Coast. Goh’s father lives in an Oakland housing project for senior citizens run by a Christian non-profit. Goh found work in a San Mateo warehouse, he doubled as a mover.

It’s not a good place to be if you’re a middle-aged failure: San Francisco has so much obscene wealth, and smug beauty — to be a fat 40-something nerd working with your father in a grocery store in Daly City, in the shadow of San Francisco, is some kind of Hell, a Hell for failures.

And then last year, Goh’s brother, an Iraq War veteran and Special Forces hero, died in a freak car accident when his Toyota slammed head-on at 70 mpg into a “multi-ton” boulder lying on a Virginia road. The photos of the accident scene look almost unreal, almost staged. The news was a blow to One L. Goh’s mother; she died within a few months after the brother.

This is the backdrop to Goh’s fateful decision to pull himself out of a years-long rut, and to start a new career for himself as a nurse. It may have been the shock of the back-to-back deaths in the family — or maybe it was his father who encouraged him, or the experience of living with his father in a building for the elderly.

Whatever the case, his widower father supported his son with a $6,000 loan to pay for the vocational nursing school tuition. But after a few months, One L. Goh was out of the program, bitter and vengeful, dead set on murder; and his father was out $6,000, thanks to his son’s bad bet.

Ignition to a Massacre

What set Goh off? Why did he leave the nursing school so early? Most reports say he was teased by his classmates for his age, 43, and his accent. Which is odd, considering most of the students are foreigners and Koreans.

(Another Korean-American rampage-killer was teased over his voice:  Virginia Tech killer Cho Seung-Hui. As another Virginia Tech student told reporters back in 2007, “As soon as [Cho] started reading, the whole class started laughing and pointing and saying, ‘Go back to China.’”)

Goh enrolled in what must have been one of the very worst nursing programs in the entire state of California: the vocational nursing program at Oikos University, a fundamentalist Korean-American Christian school in Oakland.

The school’s nursing program is accredited, which is important of course if you want your for-profit school program to make money. To comply with the accreditation, Oikos U. had provide a “2010 Performance Sheet” summing up its students’ performances both on the national nursing exam and, once licensed, in the job market.

The “performance” is abysmal, to the point where you almost wonder if it’s even statistically possible to fail as spectacularly as Oikos University’s nursing students. Of the programs 28 graduates from the Spring 2010 – 2011 term, only 11 of those 28 managed to pass the national nursing exam. That’s a 29 percent pass rate, almost unheard of.

According to a spokesman for the California Department of Consumer Affairs, it makes Oikos among the state’s very worst programs — the average success rate for graduates of other programs is 75 percent. (An Oakland Tribune article puts Oikos U’s exam pass rate at 41 percent of students who took the test, but the actual Performance Sheet gives a lower 29 percent pass figure — either way, both are awful).

Oikos University failed to prepare its students for the test, and it failed those who passed when they turned to the job market. According to the same Performance Sheet, of the school’s 11 students who passed the exam, eight found paying jobs as nurses, with salaries ranging as low as $5,000 per year to the one lucky top salary earner who earned up to $35,000. That’s in the Bay Area, the most expensive region in America.

In sum: One L. Goh could not have chosen a worse nursing program to pin his personal hopes on. This nursing program was all but guaranteed to fail him.

Fundamentalist Mission

One thing Oikos University does fairly convincingly is fundamentalist evangelical Christianity for Korean-Americans. Students at Oikos U. are required to attend regular church services; the pious language of evangelical Christianity frames everything.

The school’s president, Rev. Jongkin Kim, says his goal is “to foster spiritual Christian leaders who abide by God’s intentions and to expand God’s nation through them.” Under the university’s “Our Vision” it reads:

“The vision of Oikos University is to educate emerging Christian leaders to transform and bless the world at every level – from the church and local community levels to the realm of world entire.”

And then there’s the reality, revealed in a lawsuit filed last month by a former staffer of Oikos University named Jong Cha, who says the school cheated her out of $75,000 in salary and expenses, and stiffed her on a $10,000 loan that she personally gave to the Christian college in 2008.

Viewed from this angle, One L. Goh might have come to the conclusion at some point that he’d taken scarce funds from his poor old widower father, and handed it over to religious hucksters running the Golden State’s worst nursing program.

One thing to keep in mind here: It’s easy to see why Oikos University introduced a nursing vocational program. If you get it accredited, these nursing programs are guaranteed cash-cows. Most of the big for-profit education predators like Kaplan Inc. (which owns—and subsidizes— the Washington Post) are in on the vocational nursing for-profit gig.

You can charge students insane tuitions, hire hacks as teachers, pocket the difference, and dump the unpaid loans on the government in exchange for 100 cents on the dollar.

The Reverend who founded Oikos University certainly understood this — his good friend told the New York Times that Rev. Kim “had established the nursing school to support the school’s department of religion.” The cash must have rolled in quickly, because within a year after launching its nursing program, Oikos doubled its size — meaning doubling revenues.

And yet even with all those new revenues coming in, the school couldn’t figure out a way to raise its graduates’ test results out of the failure category. The school appears to have stiffed one of its top staffers out of her pay and her loan, suggesting, in the words of the Oakland Tribune, “that the school may have fallen on hard times.”

I wonder if this is what set off One L. Goh a few months after he enrolled — the realization that he’d been fleeced, that he enrolled in the wrong program on his father’s money.  The year 2011 had already taken his brother and his mother.

A Dashed Last Hope

There is something in between the lines that suggests his plan to become a nurse, worked out with his father’s assistance a kind of desperate last attempt to turn everything around in the proverbial One Bold Swoop.

He would do something practical, and morally good, helping the elderly, people like his father — and earn a steady income that would allow him, at last, some dignity and some chance to start paying off his debts.

It was as though Goh pinned everything on this plan to reinvent himself as a nurse — and according to all our cultural propaganda, all the Hollywood movies and newspaper bromides, Goh would be rewarded for undertaking this self-transformation. It was guaranteed to change everything.

And for a brief while last year, Goh’s mood was transformed, he really did think he had a great future ahead of him. One of Goh’s former employers at a food warehouse described Goh as “upbeat” when he ran into him last year in Oakland — a change from the usually quiet, sullen Goh he’d known.

This new “upbeat” One L. Goh boasted to his former employer “about how he had returned to school to become a nurse and help elderly people.”

The idea that you can reinvent yourself, that your fate is in your own hands, that you have the power inside of you to make yourself a winner (and if you fail, it’s all your own fault) — this may be America’s most toxic cultural snake-oil. And yet it never fails to find takers.

Of course, nothing changed — except that Goh had been conned out of his dad’s money. As his former employer put it: “Not many people go back to school at that age. He was trying something new and it wasn’t working.”

It didn’t take long for him to figure it out. Just a few months after enrolling, One L. Goh dropped out of the Oikos University program. When he dropped out of the program, he asked them to refund his father’s $6,000 that he paid for tuition. He was denied. He fought with the administrators, but they didn’t budge. This was what made him snap.

The administrator, whom Goh fought with for his tuition refund and whom he came to kill that day, has now come forward. Her name is Ellen Cervellon. She was gone on the day of the massacre because she also teaches nursing to students at California State University at East Bay.

Now she will have to wonder, why didn’t she just approve the refund to a desperate man? What if she had approved it? Her argument was that he’d already spent several months in the program. According to a friend of Ellen Cervellon’s, Linda Music, she even denied Goh his last reasonable request, to prorate the refund.

As Matthai Kuruvila reported at SFGate.com, Goh had asked Ellen Cervellon for a full refund of his tuition and when he was denied suggested prorating the tuition refund. Cervellon said no, Music said.

That meant he threw his father’s money away: He had nothing to show for the $6,000 given to the university; he would never be able to pay his father back; and he would never be able to borrow a sum like that from him again. That was it, the final act. The jig was up for him.

Lack of Empathy

Why? Why couldn’t Cervellon meet this desperate failure half-way? What was in it for Cervellon? What’s with the Ayn Randian lack of empathy in this country among the non-oligarchy caste?

Cervellon seems to be asking herself this same question: “In talking to several of the students and faculty who were there, I think he was looking for me. I have that weight on my shoulders and I don’t know what to do with it,”

School officials have been painting a portrait of One L. Goh as a psycho and a freak, using phrases like “behavioral problems” and calling him “angry” and “paranoid.” There must be truth to that; nice, normal people in a healthy state of mind don’t rampage-massacre others.

But the intended target, Ellen Cervellon, disputes that: “He was never forced out, he showed no behavioral problems, and he was never asked to leave the program. He decided on his own to leave the program.”

The depressingly familiar dead-end life that One L. Goh found himself in — surrounded by petty scams as revealed in the ex-staffer’s lawsuit and the bleak performance of the school’s graduates, combined with the back-to-back deaths of two family members — could make a lot of sane people desperate and enraged and suicidal. Not to mention the larger context of an inequality-ravaged America where opportunity and dignity are scarcer and scarcer.

On top of all this, as he complained often, students at the nursing program wouldn’t talk to him. That could be traumatizing even under better circumstances, but under his conditions, being mocked and ignored by fellow fundamentalist Christians for being an aging loser, would be devastating.

One of Goh’s teachers continued criticizing Goh even after the massacre: “I always advised him, ‘You go to school to learn, not to make friends.’” More great advice from the Oikos University folks.

After quitting the nursing program, One L. Goh spent the last few months working with his father at the Daly City supermarket. He was back at square one: A failure, swindled, condemned to work in a shitty job beside his struggling father whom he’d let down.

You might say that One L. Goh snapped because for once, he saw things as they really were, stripped of hope, stripped of fantasies about self-improvement or self-transformation.

He failed at everything; he was one of those faceless, anonymous losers. But there was one thing he could still excel at, something that could get him attention, something that this country perversely celebrates: mass murder in a blaze of anti-glory.  So long as you’re ready to make that transformation-of-character into a death row inmate, that option is always available here.

Last Monday, according to police accounts, One L. Goh armed himself with a .45 caliber semi-automatic pistol and showed up at the Oikos school for his final act. But the plan failed from the start: The administrator he was after was gone. So the target became the entire setting, Oikos University, as it so often happens in these “going postal” rampage killings.

There’s a section on the Oikos University website about the 11 beliefs that the University holds to — they call it their “Doctrinal Statement” and it’s the last belief, Number 11, that sums up the malevolence of it all:

“We believe in the existence of a personal, malevolent being called Satan who acts as tempter and accuser, for whom the place of eternal punishment was prepared, where all who die outside of Christ shall be confined in conscious torment for eternity.”

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By Mark Ames: A little over a year ago, while researching the Confederacy’s economy, I stumbled across this unnerving graph charting the value of America’s “stock of slaves” in the last decades before the Civil War.

This graph tells the real story behind the South’s secession: the value of the South’s “slave stock”—the property of the ruling class — soared as secession approached, reaching an almost 90-degree angle in those final years before Harper’s Ferry. The South’s ruling class seceded to protect their riches, period:

From afar, if you didn’t know that human “slave stock” was the asset being charted, you could easily mistake this graph, and its parabolic trajectory, for one of the many destructive asset bubbles this country has suffered right up through our own time.

Up close, this graph drips greed, mass murder and shame — it strips away the historical revisionism that falsely ascribed the South’s “cause” to an almost selfless, tragically romantic attachment to “tradition” and “culture”; it gives lie to the myth that slave owners kept their slaves to the detriment of their own bottom line.

Like the worst wars and the worst of history’s villains, the Confederacy’s one percenters seceded and fought in order to continue profiting from their most valuable investment properties — their human slave stock.

The graph comes from a grim working paper, “Capitalists Without Capital,” written in the late 1980s by a UC Berkeley economist, Richard Sutch, and a UC Riverside historian, Robert Ransom.

As they showed, slavery produced huge profits for southerners who invested in slave capital — to the detriment of all other portfolio investments, as the value of slaves soared in the mid-19^th century. By that time, by far the largest cotton-growing states’ wealth was in slave stock, not in real estate or other investments.

The slave trade was outlawed in 1808; but the slave population quadrupled from 1 million in 1800 to 4 million in 1860 — encouraged by slaveowners who “bred” their human stock, thereby multiplying their profits as the value of each slave rose.

Slavery is often portrayed by revisionist historians as somehow antithetical to market capitalism; in reality, slavery was a winning portfolio investment, the very incarnation of just how evil “free-market” capitalism can be. As the authors write:

“If slaves … were an investment included in the asset portfolio of the planter/entrepreneur, they helped satisfy the owner’s demand for wealth. But unlike most other forms of capital, which depreciate with time, the stock of slaves appreciated. Thus, the growth of the slave population continuously increased the stock of wealth.”

What makes this graph so disturbing for us in 2012 is what it suggests about today’s “1 percent” — and how they view the rest of us. It gives form to the brutal crackdown on the Occupy protests — and suggests darker things to come as we try to free ourselves from their vision of civilization, and our place in it.

Contrast that with this McKinsey report put out a few years ago by the director of the consulting group’s New York office. Titled “The New Metrics of Corporate Performance: Profit Per Employee,” the report argues that the best performing firms in our increasingly financialized era are those companies that have learned to squeeze ever-larger profits out of each employee — and not by the more traditional “return on investment” metric.

The McKinsey report looked at the world’s 30 largest companies between 1995 and 2005, and found that their return on human capital more than doubled, from an average of $35,000 profit per employee to $83,000, leading to this rather frank and nauseating conclusion:

“If a company’s capital intensity doesn’t increase, profit per employee is a pretty good proxy for the return on intangibles. The hallmark of financial performance in today’s digital age is an expanded ability to earn ‘rents’ from intangibles. Profit per employee is one measure of those rents. If a company boosts its profit per employee without increasing its capital intensity, management will increase its rents.”

Extracting rent from “employees” as a business strategy: This is supposed to be the language of feudalism, not modern advanced capitalism — and yet this is the cutting edge in 21^st century capitalist thinking, unashamed and unvarnished:

“One way to improve a company’s profit per employee is simply to shed low-profit employees. But if they generate profit greater than the cost of the capital used to support their work, shedding them actually reduces the creation of wealth.”

As with slave stock in a Southern investor’s portfolio, the McKinsey report argues that as a corporation learns to successfully extract rent from its employees, the more employees it extracts rent from, the greater its aggregate profits.

To compare “the 99 percent” to African slaves would be crude; but the mindset of “the 1 percent” then, as now, is eerily consistent. They view the rest of us not as human beings with rights, but as livestock whose meat is “rent” to be extracted.

This is the language of plutocratic capitalism, a brutal system totally incompatible with democracy and antithetical to republican government and civilization. It is the language of misery, and misery is what “the 1 percent” is promising “the 99 percent” for years to come, in ever-greater doses.

Mark Ames is editor of The eXiled Online and author of the book Going Postal: Rage, Murder and Rebellion from Reagan’s Workplaces to Clinton’s Columbine and co-author with Matt Taibbi of The eXile: Sex, Drugs and Libel in the New Russia.

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