Month of November, 2007

Anatomy of the housing bubble

Submitted: Nov 04, 2007

Readers familiar with Gray's Anatomy (the book, not the TV show), will recall it is full of detailed, numbered and labeled diagrams of every part of the physical human body, the result of a long scientific tradition begun by body snatchers and grave robbers.

We have recently come across a website, http://the housingbubbleblog.com, which approaches reports of the crash of the housing bubble with the same obsessive, scientific focus on detail. Ben Jones of Flagstaff AZ, author of the site, may be the present-day Vesalius of the crash of the speculative housing boom. Although it is possible Jones is a member of the foreclosure vulture flock, even if he is out speculating on the disaster it is well to recall how useful vultures are in the natural world.

Jones gathers a great abundance of news clips from home and abroad on the housing-bubble collapse. He is performing an extremely valuable service, making the depth and breadth of the crash visible beyond the confines of any particular community in America or elsewhere -- from local housing markets to high finance to foreign markets to the economic consequences beyond the housing bubble crash. These days, The Housing Bubble Blog is an indespensible site. We are very grateful to Jones for his fine work.

Badlands Journal editorial board
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A few random selections from the blog's latest posts:

From the report: “2. What happened in 2004? The relationship between Californian house prices and disposable income as a multiple of long rates broke down in 2004; we believe that aggressive sales of ‘affordability products’ (e.g., subprime, option ARMs, home equity loans), which spiked in 2004 (see Exhibit 2), drove Californian home prices well-above levels supported by economic conditions.”
“Now that the secondary market for these affordability products has all but evaporated, we expect home prices in California to return to normalized levels (i.e. levels implied by current and forecast disposable income in California as well as U.S. ten-year treasury yields); this implies a 35-40% fall.”
“As of last August the median house price in California was $589K, but economic conditions support prices between $350-380K (see Exhibit 1); material price declines are likely, in our view.”

“‘In general, the mortgage company wants to see a consumer default on three separate payments before considering a loan modification,’ says Elizabeth Schomburg, senior VP of the Family Credit Counseling Service in Chicago.”
“Gail Cunningham, a spokeswoman for the National Foundation for Credit Counseling, says its member agencies in areas from Southern California to Texas have seen the same trend. ‘One counselor in Amarillo, Texas, just told me ‘It seems to me they almost encourage people to fall behind in order to find help,’ Ms. Cunningham says.”

“Canfor Corp. president and CEO Jim Shepard said Friday he won’t hesitate to take more sawmill shutdowns in the face of a continuing poor market and high Canadian dollar.”
“‘If this market ratchets down, we will ratchet down our production, full stop,’ Shepherd told analysts and reporters on a conference call to discuss the company’s $42.1-million third-quarter loss.”
“Prince George Trucking Association president Stan Wheeldon said there was already a reduction in work in the summer which meant more people chasing less work.”

Retail changes? “Wal-Mart is selling 26-inch high-definition TVs for $450 this weekend. Circuit City plans to give away consumer electronics prizes every day for the next 30 days, starting Sunday.”
“Retailers, eyeing the housing slump and the credit crunch that has decimated consumer confidence, are slashing prices early in the hope of snagging a bigger share of the annual Christmas spending spree. That spree is expected to be more subdued than usual, said Ellen Davis, spokeswoman for the National Retail Federation.”

“A man waiting to transfer money at the scene told Sai Gon Giai Phong he earlier bought a $300,000 apartment which now costs $2 million. ‘There’s no business more profitable than this,’ another sitting nearby intervened.”
“Vietnamese Deputy Prime Minister Nguyen Sinh Hung promised government will impose progressive taxes on housing speculation to help deflate an impending bubble in the real estate market.”
“Ho Chi Minh City recently saw disturbing degrees of speculation-based property sales ominous of a bubbling market when thousands surrounded a housing site last week to purchase flats even before foundations had been laid.”
“Prospective buyers hired proxies to wait in long winding lines for registration applications, with at least one person paid some US$1,000 simply stand in line.”

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Right here in River City?

Submitted: Nov 10, 2007

The Sacramento-based law firm of Somach, Simmons and Dunn filed suit on November 5 against Riverside Motorsports Park (RMP) for breach of a promissory note. Somach alleges that John Condren, CEO of Riverside, signed a promissory note on August 17 for $147,703.32, payable on November 1 for legal services the firm rendered to RMP. The two Somach attorneys representing RMP departed that firm for another Sacramento firm about that time, presumably piling up new, unpaid legal bills. Only one of the questions raised by the Somach suit is who will pay RMP attorneys to defend against it.

There were recent reports about a similar situation between RMP and Merced County, currently being sued under the California Environmental Quality Act for approving the racetrack project. RMP is indemnifying the county for the lawsuit, presumably paying all its legal bills. Lawsuits are now flying around the Altamont Speedway, another RMP project. Then, there were the post-Merced County-approval revelations about Condren's prior unsavory business affairs. An interesting portrait is beginning to emerge. We don't refer to the portrait of Condren, who is beginning to look like a practitioner of a fascinating criminal specialty better dealt with by dramatic geniuses like David Mamet than by mere country bloggers. We refer to now suspected suckers in high places, the same glorious Merced business, professional and political leadership that brought the city the highest mortgage-foreclosure rate in the nation last month.

Common sense and a decent hope suggest that the talented impresario might vanish, a sack of other peoples' money in hand and a trail of unpaid bills behind him. If that came to pass, perhaps a little trail of smooth dirt could be fashioned on one or two of those RMP parcels, where the above-mentioned "leaders" caked with the well-known substance could peddle their grandchildrens' plastic tricycles and chant in unison, "Vroom, Vroom, Vroom," for public amusement at the First Annual Suckers 500.

Badlands Journal editorial board

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Open letter from Stevinson resident Robby Avilla to Supervisor Diedre Kelsey and Assistant Planning Director Bill Nicholson

Submitted: Nov 11, 2007

As I have noted in letters to the editor of the Merced Sun-Star, and also before the Hilmar/Stevinson MAC Board, I am greatly disturbed by the process that Merced County used to expand the Stevinson SUDP (Specific Urban Design Plan).

This expansion is only being created to enable the Stevinson Ranch developers to attach a 3,880 unit gated community onto a town with a population of 400 people. Without the development there were no plans by Merced County government in place to expand the growth boundaries of the town of Stevinson.

The two of you, Supervisor Kelsey and Planner Bill Nicholson, both have said numerous times that you wanted to give something to the residents of Stevinson if this development were to be built, and so you wanted the developers to provide sewer and water to the residents of Stevinson. This was both of your selling points for including the development within an expanded SUDP for Stevinson.

I feel that you led the citizens of Stevinson astray with those comments. First, the sewer installation will be a sewer trunk line. Local residents cannot hook into a sewer trunk line. There are only 34 homes along the road where the line is to be installed. A sewer trunk line needs at least 50% capacity before it can flow. The current homes, plus the school, would not even come close to making that trunk line flow. That sewer trunk line will only be used by developers when they create even more residential development in the town of Stevinson. It will never be used by current residents for their own use as you professed that it would. Likewise, the water lines would support such a small contingency of Stevinson's population that it is all but useless to the community as a whole. Merquin School's water is continually tested. It has tested clean for drinking and they would be the main user on that line. Your idea of providing Stevinson with these amenities does not hold up considering the increase in traffic congestion that all of us would have to put up with for years before we would get new roads. I believe that both of you knew that the sewer trunk line would not be usable to the current Stevinson residents and was only being installed for further development, and also that you knew how small a population would be served by the water lines. So, I believe that both of you were not really interested in providing these amenities to the residents of Stevinson, but, instead, were trying to soften the blow of the astoundingly large development to the residents of our community.

MAC Board Chairman, Peter Stavrianoudakis, came to our group, the Stevinson Citizen's Group, saying that the Kelley family requested that Supervisor Kelsey not let him lead meetings in Stevinson anymore. When we questioned him why this could be, he said, "The Kelley family thinks that I am against their development. I am not against their development, I am just against the process that Merced County is using to get it in." Supervisor Kelsey, within one month you removed Mr. Stavrionoudakis from the board completely. You would not give a reason for his removal to the other members of the MAC Board, saying that they serve at your discretion. I feel like the MAC Board needs to be told that the Kelley family made that request of you and then just a short time later you did in fact remove him from the Board.

MAC Chairman, Peter Stavrianoudakis, requested on three separate occasions at MAC meetings that a guidance package should be provided to the Hilmar/Stevinson MAC Board for the Stevinson Ranch/Gallo Lakes Development. Mr. Nicholson, you replied that none had ever been presented to the board for comment and, you also stated, before the Board and the residents in attendance, that you would provide one. You never did so. The Hilmar/Stevinson MAC Board has never had a guidance package to comment on about the Stevinson Lakes/Gallo Ranch proposed development. However, the MAC Board was recently given a guidance package to comment on about the Turlock Golf Course Development. They are both privately funded developments. Why would a guidance package be necessary on one development and not the other?

Lastly, and most importantly, every single meeting of the steering committee that formed the enlarged Stevinson SUDP was held in violation of the Brown Act. Nothing was posted in our local newspaper about the formation of the steering committee or the meeting times and dates. Nothing was posted on our post office or any buildings in town of the meeting dates. There were no fliers sent to local residents. The meetings were held in the Stevinson Ranch Clubhouse with no agenda posted on the door.

Supervisor Kelsey, I work within the land use arena in Merced County and many of the people that I work with are staunch defenders of you. You support them and so they want to turn a blind eye as to what you have done in Stevinson. I feel differently. I do not expect them to understand what we have gone through in Stevinson, but I do expect you to right your wrongs. You have touted the Stevinson Ranch/Gallo Lakes Development on two separate occasions at the Board of Supervisor meetings, saying that you think it is a "good project". You made that statement to the Board before a final plan had been drawn and before an EIR has even been completed. You used the Stevinson Development as an excuse to keep projects ongoing during the General Plan update process.

The above issues lead me to believe that the two of you have worked in cooperation to enable the owners and developers of the Stevinson Ranch/Gallo Lakes Development to have an unfair advantage in bringing their project and an unlawfully created SUDP plan before the Merced County Planning Commission and Merced County Board of Supervisors. I believe that you knowingly led residents to believe they would benefit from amenities they will not be receiving, you tried to control the local MAC Board's opposition to the process that Merced County was using by eliminating it's Chairman at the developing family's request, you unlawfully kept the steering committee meetings quiet and you did not give the Hilmar/Stevinson MAC Board the proper paperwork.

I am sending this letter via email and hard copy. I am requesting that respective to your particular duties you:

1. Write a letter to the community of Stevinson stating that local residents would not be allowed sewer usage because of flow issues with the development's sewer trunk lines. I want it stated that these lines are for the use of future residential development and not for the use of current resident's waste. I feel that the citizens of Stevinson deserve clarification on this issue.
2. Write a letter to the Hilmar/Stevinson MAC Board stating why Chairman Peter Stavrianoudakis was ejected from the board. Bear in mind that Frank Amaral has been allowed to remain on the board as one of two representatives from Stevinson even though he rarely attends a meeting.
3. I request that the Merced County Planning Department send a guidance package for comment to the Hilmar/Stevinson MAC Board regarding the Stevinson Ranch/Gallo Lakes Development.
4. I request that the Merced County Planning Department scrap current plans of enlarging Stevinson's SUDP and start from scratch with a process that is legal, publicized and will allow the residents of Stevinson a voice in the size and scope of their own town. A steering committee might be a good solution for some situations, but I believe that when you are considering taking a town from a population of 400 to 19,000 residents it is of utmost importance for the whole town to feel they have representation. This was done in Hilmar and needs to also be done in Stevinson.
5. I request that you form a separate MAC Board for Stevinson. I request that you make that Board represent all members of our community, with members who are both pro and against this development.

I am emailing a copy of this letter to concerned parties so that they know exactly what my grievances and requests are.

Thank you, Robby Avilla

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The real speculators

Submitted: Nov 15, 2007

The only story that matters in Merced today is how one in 68 householders are in foreclosure trouble. But, that is the story least likely to be told in public because it involves the people we elected to the city councils and the county Board of Supervisors. We will have to do our own reflecting on it; elected officials won’t.

In incorporated cities, the councils are the local land-use authorities. In unincorporated areas, the board of supervisors is the local land-use authority. These are all elected officials. In addition to two state legislators, Merced also has a congressman, Dennis Cardoza, heavily involved in real estate, whose local office is on the third floor of the county administration building.

Although we are familiar with a few development projects that have been sued, some successfully, we are only aware of one project that was rejected during this whole frenzy, which has now given Merced such a fine reputation in the finance, insurance and real estate industry. Admittedly, last month Stockton surpassed us with a one-in-31 rate, tops in the nation, but the housing crash is young and we may yet regain our title on a per capita basis.

Although it may be a benefit to the city of Merced that one realtor and one realtor/insurance agent/mortgage broker were replaced by two candidates not involved in real estate, it doesn't matter -- the damage is done and cannot be undone. When the damage was being done, five of the seven members of the Merced City Council were actively engaged in the real estate business, including the reelected mayor. The damage, however, could still be limited. The entire county does not have to become an urban, industrial slurb along the lines of cities east of Los Angeles. But, that would require reflection and gumption on the part of public officials. The recent winner of the Merced City mayoral sweepstakes, realtor Ellie Wooten, seemed to have chosen patriotism over real estate as her theme, enlivening her campaign with a rendition of “Yankee Doodle Dandy.” Patriotism is the last refuge of realtors?

Surely there were other voices in Atwater beside the realtors on its council during that town's real estate frenzy, but the realtors drowned out all others. In Livingston, the planner quipped, "When the rooftops are built, the commercial arrives." Los Banos simply exploded with commuters.

The county board of supervisors is composed of three large landowners, one failed dairyman and a professional rightwing politician, all busily speculating on more growth for Merced County on behalf of their own landholdings and on those of their supporters.

These elected officials are intent on destroying the agricultural base of this county's economy, making Merced air quality as bad as Fresno or Bakersfield, ruining the region's water quality, and destroying the natural resources and wildlife habitat that is Merced County's unique beauty and the source of what is healthy that remains in its environment. They have not shown an inkling of judgment since UC Merced was a "done deal" and to imagine they have been chastened by the foreclosure rate is fantasy. There are too many big deals in the offing: To name a few: Castle redevelopment, Riverside Motorsports Park (RMP), the WalMart distribution center, a 3,000-home new town in Stevinson, development to link Delhi and Hilmar with Turlock, a whole new commercial enterprise zone mapped out with multiple locations throughout the county, all the development that will occur along the UC Merced Parkway, the several thousand more homes in the UC Community, commercial plans for Mission Blvd. south of Highway 99, and greedy “spheres of influence” reaching out from each municipality.

Far from exercising any caution toward predatory finance, insurance and real estate special interests as well as slick operators like RMP, our elected local land-use authorities made love to them from the beginning. To believe they will change their views at this point is absurd. But absurdity is always a part of real hope. It is false hope that lacks the leaven, and false hope is going around Merced like this winter’s flu, foreclosure and fear.

To believe that chatting them up politely in their offices will change their minds belies repeated experience. All it will do is suggest to them new clever tricks to get by the public, like Kelsey's non-hearing "town-hall" meetings on RMP, or demure statements on the WalMart distribution center recently made by the city attorney or the many calculated misstatements of the losing candidate for mayor of Merced. Their minds were captured by visions of development bonanza. No matter how many development corporations go bankrupt, no matter how many of their own citizens suffer foreclosure, the elected officials on our local land-use authorities – many collecting fees on foreclosures – have been permanently blinded by that bonanza. And, for a heady season, they were somebodies, courted by the rich and powerful as the local realtors and mortgage brokers raked in the fees. And they are untouchable in their local jurisdictions.

Today, Merced County residents are suffering one of the larger financial wounds in California.. It is a position shared with those other great centers of foreclosure, Modesto and Stockton, all parts of the region we have called until recently Pombozostan, in honor of representatives Pombo and Cardoza, who intended to obliterate the very idea of endangered species and any open rangeland on which they might exist free from the developers’ ripping chisel. Stockton's largest developer leads the famous California Partnership with the San Joaquin Valley to map out future growth alongside the Valley transportation blueprint two years after he gathered a group to provide a $50,000 campaign pourboire for the Pomboza’s last charge against the Endangered Species Act.
The stink from Pombozastan keeps on rising, like the stench from the old Moffat Manteca-Fed feedlot.

The public must forget this because it is inconvenient to elected officials that the public remember it. So, hacks and flaks are dispatched to make the public forget and provide soothing propaganda to put the public to sleep again and encourage elected officials to continue the mad pace of growth to urbanize one of the world’s greatest agricultural valleys, because its land is cheaper than coastal property. This week, a free-market hack named O’Toole told a gathering of realtors in Modesto to work for the abolition of planning departments and all regulations and laws concerning planning and let the market decide it all. It was reported as an amusing lecture. In fact, that is what was done in Merced and other parts of the former Pombozastan, despite the screaming denials of the hacks and flaks. At the recent UnityFest at UC Merced, a ludicrous seminar allegedly on “Political Participation” took place, consisting of a public “dialogue” between the Merced County flak and the UC Merced flak, tossing puffballs between themselves to the mystification of a few UC students and members of the public who came to learn something about public political participation. The flaks and the hacks are very busy making the public forget what is going on as fast as it happens. The hacks and flaks are in crisis mode. Their job is to make it as difficult as possible for the public to reflect on what has happened in Merced. Today, the rap of the highly coordinated hacks and flaks in town is an impenetrable wall of development propaganda, constantly projecting an even rosier urban future as the here and now gets worse.

In a recent poll, Valley residents alone among the state’s several regions said that Valley air pollution -- not global warming -- was the worst problem in the world. We think that Valley residents, asked the question, took the opportunity to denounce their air quality and the policies, developers and politicians behind it even though the question addressed a region (the world) somewhat larger than the Valley.

The idea that a gigantic slurb the length of the San Joaquin Valley is going to be able to employ its residents is a dubious proposition, first, because the place created by the population estimated will be nearly unlivable – as Stockton and Sacramento would be without a Delta breeze – and won’t be the place attracting business geniuses creating employment. Secondly, because there is no discernable employment plan. UC Merced could well end up being the academic equivalent of Naomi Klein’s crisis capitalism, a ghoulish institution studying environmental diseases and social breakdown caused by growth its arrival in part stimulated. However, vast tracts of the Valley are owned by agribusinesses that don’t employ enough people, are selling to developers or becoming developers. Agricultural organizations like the farm bureaus (insurance companies) have become useless as representatives of anything but private property rights. Valley agriculture is in a contraction pattern, holding onto land waiting for the developer. The creativity, innovation, risk and growth that characterized it through most of the last century is exhausted. Despite massive public water projects, subsidies and subventions and psychotic immigrant policies, and decades of agribusiness propaganda, or perhaps because of them, Valley agriculture seems unfocused today, as if it has lost its sense of meaning, its purpose, its style and its sense of humor. Today, with some exceptions, it is a supine culture, full of empty self-congratulation and empty slogans it no longer believes. Valley agriculture acts like it no longer believes in itself and verything’s for sale. Ag land values seem to be holding at least in Merced County, due to sales to development investors and, lately, to ethanol pressure (one of the latest investment bubbles, which might pop before it floats). But agricultural production looks like a pretty cynical affair these days. Rice, cotton and dairy are still strong enough politically to get what they want out of a federal farm bill, but the specialty crops that are the backbone of California production got very little. Rep. Mike Thompson, D-St. Helena, would have been a far better choice than Cardoza to argue their causes in Congress. But, the Democratic leadership chose the inept Shrimp Slayer, who we think shot his wad during his sojourn in Pombo’s hip pocket trying to wreck the ESA on behalf of local developers rather than specialty-crop producers. Even members of Congress must be able to see through that: the Assistant Destroyer of ESA in 2006 becoming the Champion of Almonds, Kiwis, Blueberries and the Honey Bee in 2007.

It’s been 40 years since Valley agriculture employed many people from the towns and cities it surrounds. Perhaps that loss of connection – knowing the family of the kid in your packing shed – has also slowly rotted agriculture’s sense of local social purpose and the urban Valley’s sense of the local social purpose of agriculture. The food-distribution oligopoly and mounting off-shore competition haven’t helped either.

Politicians, bureaucracies, banks, insurance companies and every business that makes a dime off agriculture have babbled the empty slogans – worst of which because greatest insult to reality is the sanctity of “family farming” – for so long and so effectively that they have hollowed out all content from these sacred phrases. And, like more and more farming, especially of the type best done in California, American manufacturers have been chasing cheap wages off-shore to a point of probable no return and much food processing has gone with them.

Empty phrases like “working class” are beginning to appear in the newspaper. Urban hammers with rural sickles yet, from the mouths of Democrats in City Hall? Unions, which young working people tend to reject, don’t talk about the working class much anymore. Many younger Mexicans never heard of Ricardo Flores-Magon and think Cesar Chavez was a boxer.

Language—above all—language means nothing in this town since UC Merced and the developers bought public speech and the local media. Concerned citizens are warned by supervisors to speak as politely as developers, and our congressman is led to the gutless vacuum of “balance” on every important issue of state. But, we live in a moment of drastically important issues of state in which there is no “balance” whatsoever. Single-issue opponents of projects are cajoled into presenting alternatives they lack the knowledge and data to back up. Merced elected officials are competent manipulators on behalf of their own interests and other special interests. The common good of residents in the here and now is not their interest, special or otherwise. However, embracing the absurdity necessary for real hope, let us hope that the working poor of Merced and those of slightly higher income bilked by mortgage brokers in the “house of their dreams” form unions, among them a Union of the Foreclosed with Ruined Credit. The false hopes of “activists” making alliances with the gravediggers of the present residents promise nothing but one more carefully built trail over another cliff. “Working Class – This Way, Please.” When we need people to confront the land-use authorities that brought this mess down on us, we get people whose one political move is the Big Kiss Up.

Merced was a great place to farm and agriculture was acknowledged by local government to be the prime economic force in the county until the arrival of UC Merced. The campus stimulated a wild season of real estate speculation, a bubble that has now like a balloon filled with sewer water. UC Merced suggested a whole new, urban, high-tech, bio-tech future for the county, which immediately inflated the residential real estate values and deflated the importance of agriculture (if not ag land values). In one fell swoop, according to the One Voice of our leaders, Merced would transcend the problems of agriculture and become one more fantasy Silicon Valley, just like all the other fantasy Silicon Valleys scattered across the nation. It was lunacy but it sold houses at incredibly inflated prices for incredibly bad mortgages, which are now a part of a global credit crunch that is beginning to cause banks to fail. We are at the center of a massive fraud that everybody who is anybody from Merced County – from Washington to Wall Street to Bob Hart Square – was in on.

The foreclosure crisis is an opportunity for the public to reflect on the veracity, competence, and the intent of its political leaders. They show every sign of wanting to continue their mad urbanization of a rural, agricultural county still productive, relatively beautiful and healthy compared to worse excesses in San Joaquin, Stanislaus, Fresno, Tulare and Kern counties. Since the arrival of UC, their dream solution for poverty has been to squeeze out poor people with inflated real estate values. Too many ships that strategy raised a few years ago are sinking fast these days, having struck predatory financial mines. Local land-use authorities have in front of them the imperious, publicly funded, development greed of the University of California, the anchor tenant for growth down the entire east side of the San Joaquin Valley. The other end of the UC Merced Parkway is anchored by the proposed WalMart distribution center. The UC Community is planned to fill in some of the “blank space” (prime farmland) in between. Behind them, our elected officials have finance, insurance, real estate and large landholding interests. Is there any room for the citizens of Merced County today in their elected officials’ plans for their own tomorrows?

“Growth” here, which simply means more subdivisions, is anything but “inevitable.” It is the result of political deals that profit somebody at the cost of everybody’s future. We must escape the destructive drift of the economic predators and their political cronies. Banks, insurance companies, realtors and large landholders have never been the friends of rural America and they are not now, either. They should not own Merced County’s local land-use authorities. These authorities in the pockets of predators have caused economic havoc and despair in their own communities. The Valley once understood such elementary facts but its steady urbanization has reduced it to the idiocy accompanying mature corruption – the impenetrable mindset of the political class that believes its own propaganda. Former Modesto Mayor Carol Whiteside, founder of the most cynical development propaganda organ in the Valley, the UC/Great Valley Center, showed this region the way 20 years ago, with Village 1, a deal between her city council and developers that cost the City of Modesto $40 million plus interest.

The test of government is its care of the least of us, not the richest and most powerful. The grand result of local governments’ land-use design in Merced County has been to grow slums full of strangers. In a particularly cruel twist, some of these slums are brand-new subdivisions in which too many people are going bankrupt to form anything like the roots of neighborhoods. A decade ago, there were more humane elected officials and – at least in retrospect – a coherent community. The main cultural difference is UC, whose commitment to rural California has always been the technology of agribusiness. Smaller farmers and lower-income townspeople need to get together, fast. Everyone who is not in on the deal needs to organize against the deal. But, this would require a willingness to confront a gang of experienced, corrupt politicos stoned on their own growth propaganda, spoon-fed them daily by their in-house hacks and flaks. They cannot afford to admit they have done anything wrong or made any mistakes.

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Unasked questions about TNC Staten Island

Submitted: Nov 17, 2007

Assemblyman Bill Maze, R-Visalia, sicced the state auditor on a Natural Conservancy-owned ranch near the San Joaquin Delta recently. Maze says the easement and TNC management of the 9,200-acre ranch stink and asks why $17.6 million in state flood protection funds is being spent on a Delta island that shows no signs of levee improvement.

The money came from Prop. 13, passed in March 2000, originally AB 1584, the $1.97-billion Safe Drinking Water, Clean Water, Watershed Protection, and Flood Protection Act authored by then Assemblman Mike Machado, D-Linden.

The Sacramento Bee article on the flap fails to raise several important questions.

For example, quite aside from the issue of who funded the project, would TNC be able to build flood-control levees according to the terms of its conservation easement on Staten Island, winter home of a TNC-estimated 15 percent of the migratory Sand Hill cranes? The plan, as best we can determine from the article is to flood the island in the winter after the grain crops are harvested to make a pleasant habitat for the traveling cranes and other flocks. Some in Merced familiar with the quality of the TNC conservation easements to mitigate for UC Merced know that TNC is not shy about taking public funds for easements that cannot stand the light of public scrutiny. And so does the state Department of Fish and Game, the Wildlife Conservation Board and UC.

Another example of questions unasked is: how much money did TNC contribute to get Prop. 13 passed? According to CalVoter archives for the March 7, 2000 primary, although no funds were recorded in opposition to the proposition, $10,502,802 were spent selling it. (Sixty-five percent of the voters approved it.) TNC, the top contributor to the Prop. 13 campaign, gave $3,022,068 -- 29 percent of all money raised for the proposition. TNC was also the top contributor, with the same amount, to Prop. 12, the Parks, Water and Coastal Protection Act Bond, according to CalVoter.

It is also a matter of political curiosity that Staten Island is on the border of Machado's present state Senate district.

Three million to make $35 million (the other half of the Staten Island funding comes from the CALFED Bay-Delta Program) isn't a bad deal if you have the $3 million to put down when the time is right. And TNC did and no doubt made many friends among the state and federal agencies in charge of dispensing these public funds. A similar return on investment could no doubt be traced to some of the other top 10 contributors to the Prop. 13 campaign.

If this background is added to the particulars of Maze's Tulare County district, represented in Congress by Devin Nunes, R-Visalia, Scourge of the San Joaquin River Restoration Settlement that passed its first hurdle in Congress last week, perhaps the story below becomes clearer as part of the general California water war. But it is also evidence of the very arrogant way in which the multi-national environmental Leviathan TNC does business (as we have seen in Merced County), it gives bushwhackers like Maze their opportunity, it encourages every grant grifter in the tules to whip up a group of bogus stakeholders and write the state for the big bucks, and it darkens the reputation in the general public of every environmental group trying to do a decent job in a lawful, socially responsible way.

Bill Hatch
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11-12-07
Sacramento Bee
Quiet island in dispute
Use of state flood grants to buy land scrutinized...Judy Lin
http://www.sacbee.com/111/v-print/story/485403.html

STATEN ISLAND – This time of year, when the sun falls earlier by the day and the corn has been harvested, is the best time to see the sandhill cranes.

The sky above a stretch of flooded farmland on this island in the Sacramento-San Joaquin Delta becomes speckled with white and pale gray birds.

The creatures – distinguished by long legs and longer necks – come to roost on this wetland each winter. Some have been spotted for at least 18 years.

Conservationists tout the 9,200-acre island, located south of Walnut Grove in San Joaquin County, as a successful marriage between wildlife and agriculture. They applaud the state Department of Water Resources for its willingness to invest in wildlife preservation.

But a recent state audit has raised questions about the department's decision to hand $17.6 million in flood protection bond money to a non-governmental organization that emphasizes habitat protection over flood control.

State Auditor Elaine Howle stressed the need for better monitoring as the department gets ready to dole out $330 million in additional flood protection bonds.

"DWR needs to do a better job of managing the flood protection corridor program," Howle said in an interview. "We found several weaknesses in awarding the grant, as well as monitoring how well those programs are proceeding."

The audit, which was released Nov. 5, said the department failed to show the merits of five grants in 2001, including the $17.6 million Staten Island grant. The grants, which totaled $28 million in all, were funded through the Flood Protection Corridor Program, created by Proposition 13 in 2000.

DWR Director Lester Snow agreed the department needs to do a better job of tracking grants and decisions. The audit was especially critical of the department, then under former director Tom Hannigan, for not using a scoring tool that would have ranked projects based on their merit.

Snow said more staff members have since been assigned to the program.

The Staten Island grant helped the Nature Conservancy buy the island for $35 million. The California Bay-Delta Authority put up the rest of the money.

In return for the department's investment, the state retains easement rights for flood projects.

Keeping the land undeveloped gives Staten Island the potential to absorb water in case of a flood, said Dawit Zeleke, regional director for the Nature Conservancy. The water around the island is fed by the Cosumnes and Mokelumne rivers.

"When I look at the cranes, I think it's a wise investment," Zeleke said.

Some believe the money should never have been spent on buying Staten Island.

Assemblyman Bill Maze, R-Visalia, who called for the audit, took notice of Staten Island in 2005 after reading a story in The Bee about the precarious nature of levee funding. At the time, the story found that only six of the 26 miles of levees surrounding Staten Island had been maintained.

"It should not have been used for that project whatsoever," Maze said.

Since then, the audit found that not much has improved.

"Six years after Nature Conservancy acquired Staten Island, Water Resources has yet to implement a flood protection project on the island, and it is unclear whether the acquisition will ultimately result in a tangible flood protection project," the audit states.

The audit also questioned the department's contention that the island provides significant flood protection by preventing development in a flood-prone area, given what the audit called "the current legal restrictions prohibiting such development."

Snow, however, defends the department's selection of Staten Island.

Snow said funding from Proposition 13 allowed the department to acquire easements to protect floodplains while preserving the agricultural use of the property.

"The Staten Island project," Snow said, "clearly meets the statutory criteria for the program."

In addition to questioning the Staten Island grant, Howle recommended changing the grant selection process to require the department to justify the merits of each project. She also recommended following up to make sure grant recipients spent the money appropriately.

Auditors said they had no way to review the selection committee's decisions. Of 11 projects the department considered funding, five were selected without proof of a competitive process.

Snow said he intends to adopt a ranking system for future flood protection projects as the department prepares to hand out new bond money.

Last November, voters approved two bond measures – propositions 84 and 1E – that provide the department with $330 million for flood protection projects. The money has been designated for the protection, creation and enhancement of flood protection corridors and bypasses.

At Staten Island, the Nature Conservancy says the state's investment allows the farm to export nearly 40,000 tons of corn a year and provide a home for up to 15 percent of the region's greater sandhill cranes, which are listed as a threatened species.

The cycle is simple. Farmers grow corn and wheat during the year, then flood the land after crops are harvested, creating a haven for cranes and other birds.

The cranes that winter on the island are playful. On a dirt road cutting through the farm, Zeleke looks out on the birds as they throw their heads up, fan their wings and occasionally toss grass.

"This is the ideal situation," Zeleke said. "You have the economy benefiting ... and also managing the land in a successful way that the cranes keep coming back."
-----------------

Notes:

http://www.lao.ca.gov/ballot/2000/13_03_2000.html
http://www.calvoter.org/voter/elections/archive/2000/primary/propositions/13.html
www.calvoter.org/voter/elections/archive/2000/primary/propositions/topten.html
http://www.nature.org/wherewework/northamerica/states/california/projectprofiles/staten_island.html

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Varieties of federal farm subsidies

Submitted: Nov 20, 2007
"David believes this is a system that's in need of reform," Johnson said, adding that his
boss is unlikely to accept any more subsidy checks. --- Scripps Howard News Service, Nov. 16, 2007, http://www.scrippsnews.com/node/28427

The terrible news about flagrant misappropriation of farm-subsidy funds begins:

"Even billionaires get ag handouts"
by Lisa Hoffman

More than 50 American billionaires have received government farm handouts in recent years from a program created to help struggling small farmers survive. David Rockefeller alone received more than $50,000 from investments in farming between 2003-2005.

Evidence is heaped on that those poor struggling small farmers, whose 40 acres and their mules are now being swept away by a plague of billionaires in the following graphs:

In just two years, between 2003 and 2005, at least 56 of the richest people in the
country have pocketed taxpayer-funded federal agriculture subsidies totaling more than $2 million, according to a Scripps Howard News Service analysis of a newly released U.S. Department of Agriculture database.

Included in that roster are banker-philanthropist David Rockefeller Sr.; five members of
Wal-Mart founder Sam Walton's family; hotel czar William Barron Hilton; Microsoft
co-creator Paul Allen; and nine members of the Pritzker clan of Hyatt Hotel fame...Estee
Lauder cosmetics heir Leonard Lauder, for instance, received about $4,000 via his 5
percent interest in an Idaho organic dairy farm... Some of those recipients can be found
in the Senate itself, where at least six of the 100 lawmakers have themselves received
five-figure-or-higher farm subsidy checks... the most generous billionaire subsidy in the
2003-2005 span -- a total of $306,627.09 -- went to Whitney MacMillan, heir to the
Cargill agribusiness dynasty. Forbes estimated his fortune to be about $1.2
billion...That billionaires are getting paid by a program -- created during the Great
Depression -- intended to help small farmers stay on the land is the best evidence that
wholesale changes are needed, critics said.

The sheer amounts of money being siphoned out of pockets of yeoman family farmers are devastating to our sense of the just disbursal of public funds. To make the point even more emphatically, the reporter calls upon the rightwing think tank, the Heritage Foundation, which brings the waitresses into the story.

"It is not within the nation's values to tax waitresses and welders to subsidize
multimillionaires," Heritage analyst Riedle said.

Whether the Senate will close the loopholes -- and whether those limits would survive a
House-Senate committee that crafts the final bill -- is unknown. Senate agriculture
committee chairman Tom Harkin, D-Iowa, says reform is a matter of "basic fairness."

"It is also a matter of recognizing that (the Agriculture Department) should not pay out
hundreds of thousands of dollars -- or even well over a million dollars in cases (cq) --
to billionaires," Harkin said. "These are payments we can't afford, going to people who
don't need them."

Among those Harkin referred to are: Microsoft co-founder Allen, who got $39,932 worth of subsidies; brokerage bigwig Charles Schwab, $67,498; the Walton family, at least $8,800; and banker-philanthropist Rockefeller, who received $50,023 in subsidies.

Worth an estimated $2.6 billion, Rockefeller is in favor of barring people like himself
from getting the benefits -- and not because $50,000 is just pocket change for those in
his economic bracket.

Horrifying! And that's not the worst of it. Consider a recent letter to the editor of
the Fresno Bee concerning the number of farmers no longer alive that receive farm
subsidies:

Letters to the Editor
Fresno Bee
July 27, 2007

Dear Sir or Madam,

The U.S. Department of Agriculture gets my inept federal bureaucracy of the month
award for writing subsidy checks to 172,801 dead farmers totaling $1.1 billion dollars
during the period from 1999 to 2005. This gives new meaning to the term "buying the
farm."

All the sordid details are available in a report from the Government Accountability
Office located at http://www.gao.gov/new.items/d071137t.pdf.

Nineteen percent of the deceased subsidy recipients had been dead for seven years or
more, while a whopping 40 percent had been dead for three years or more. Even more
troubling, someone undoubtedly alive signed and cashed those checks given the
considerable difficulty the dead have in signing checks.

There must be plenty of dead San Joaquin Valley farmers on the list given that we
are the farming capitol of the nation. They must be chuckling somewhere in the Great
Pasture in the Sky that they couldn't make any money while living but managed to generate some green after they were gone.

Lloyd Carter
2863 Everglade Ave.
Clovis, CA 93619
(559) 304-5412

We have never really known what to think about farm subsidies, “farming the government,” as it is called. We know we live in one of the poorest county in California and that the median income here is about $36,000. Rep. Dennis Cardoza, Shrimp Slayer-Merced, tried mightily amid the dim for reform on the new Farm Bill to get more farm subsidies for our county -- for its specialty crops, not the old standard commodities inevitably described by California ag congressmen as "Midwestern." Perhaps it is impolitic in Congress to note that the top recipient state for farm subsidies is Texas, although lesser-ranked states are largely in the Midwest. California ranks tenth in the nation in farm subsidies.

Using the Environmental Working Group Farm Subsidy Data Base, we can make some comparisons over the 10-year period from 1995-2005 that may shed more light on farm subsidies than provided by Scripps Howard.

In that period, 1995-2005, Texas, the top recipient state, received $14.9 billion in all farm programs, as best EWG can figure. There are kinds of payments that were impossible to get from the USDA for that period. Iowa, the #2 recipient, received $14.8 billion. California, at the #10 position, received a mere $9.4 billion over that decade.

The average payment for the top 10 percent of Texas recipients was $44,278. For Iowa, the average for that class of recipients was $36, 530. The top 10 percent of California recipients nearly doubled Texas as $82,160.

Eighty-two percent of Texas farmers get no subsidies. The top 10 percent of subsidy recipients, however, get 76 percent of all subsidies. Thirty percent of Iowa farmers get no subsidies; and the top 10 percent of recipients get 55 percent of the total subsidy to the state. In California 91 percent of farmers receive no subsidy; the top 10 percent of subsidy recipients receive 73 percent of the state's total farm subsidy.

The discrepancy in the numbers that most clearly reminds us of the San Joaquin Valley agricultural economy is a comparison of the spread of subsidy receipts of the top 20 recipients in each state. In Texas, #1 in subsidies, the top recipient received $8.8 million between 1995 and 2005. The recipient ranked 20th received $5.9 million. In Iowa, the top recipient received $3.7 million and the twentieth received $1.9 million.

In California, the top recipient of subsidies over that decade, Sacramento-based Farmers Rice Coop, received $145.5 million and the twentieth received $5.9 million. Farmers Rice is the third largest recipient in the nation. The larger recipients are rice operations in Arkansas.

Bringing it home to 18th Congressional District of California, represented by Cardoza, which is setting national records for the unaffordability of its real estate and for its foreclosure rates, we scanned the following list of the top 20 farm subsidy recipients in the 18th CD. We do not do this to embarrass anybody on this list. They are simply the most fortunate among 3,276 recipients of farm subsidies in this congressional district. And, despite the particular political vice of our region, radical personalization of everything political and economic, we realize that this is just their business as they will no doubt realize that the receipt of amounts of public funds of this magnitude is also the public’s business. Altogether, the 18th CD received $405.3 million in farm subsidies over that period. As shown above, in California there are districts that received much larger amounts of farm subsidies. In the 20th CD of California, represented by Jim Costa, D-Fresno, for example, 3,597 agricultural enterprises received $918.3 million. The second largest recipient in the state, J.G. Boswell Co., received $17.3 million over that decade.

Nevertheless, the struggling family farmers of Merced County (19 of the top 20 subsidy recipients in the 18th CD) didn't do too badly.

1 Wolfsen Land & Cattle Co ✴ Los Banos, CA 93635 $11,578,112
2 Bowles Farming Company Inc ✴ Los Banos, CA 93635 $8,128,408
3 S J R Farming ✴ Los Banos, CA 93635 $4,905,868
4 Lewis Maiorino Ranches ✴ Dos Palos, CA 93620 $4,510,973
5 Koda Farms Inc ✴ South Dos Palos, CA 93665 $4,211,808
6 Coburn Ranches ✴ Dos Palos, CA 93620 $4,181,650
7 Roduner Farms ✴ Merced, CA 95340 $4,051,265
8 Teixeira And Sons ✴ Dos Palos, CA 93620 $3,924,198
9 David Santos Farming Los Banos, CA 93635 $3,794,937
10 Perez Farms ✴ Crows Landing, CA 95313 $3,725,288
11 A-bar Ag Enterprises ✴ Los Banos, CA 93635 $3,643,332
12 Murrieta Westlands Trust ✴ Los Banos, CA 93635 $3,513,904
13 Clark Properties ✴ Dos Palos, CA 93620 $3,191,165
14 Clark Produce ✴ Dos Palos, CA 93620 $2,974,472
15 Paul Goodman Dos Palos, CA 93620 $2,953,057
16 David Carlucci Farms ✴ Los Banos, CA 93635 $2,723,512
17 Edward And Nancy Silva ✴ El Nido, CA 95317 $2,700,308
18 The Pentagon Company ✴ Los Banos, CA 93635 $2,692,634
19 Gilardi Farms ✴ Los Banos, CA 93635 $2,607,833
20 Favier Farms ✴ Merced, CA 95340 $2,566,154

For anyone interested in learning more about the agricultural economy of our region, we suggest consulting http://farm.ewg.org/sites/farm/, which breaks up the figures in ways friendly to many questions that occur. Our only thought so far is that this is a lot of federal pork mostly for cotton, much of it shipped to off-shore textile mills and garment manufacturers. These figures do not calculate the public costs of the federally subsidized water used to grow the cotton. This isn’t to say that American working people don’t need cheap clothing, milled and manufactured by people workers making much less than they make. But, as many have observed in the course of World Trade Organization debates and what is left of the debate on the 2007 Farm Bill, this may not be either a balanced or productive way to manage an economy. Farm subsidies of this magnitude are definitely a most direct means of managing an economy for the benefit of a small number of agribusiness enterprises rich enough to own as many members of Congress as they need to keep the pork barrel topped off. However, we know, because it has been famously reported in Congress that the San Joaquin Valley is poorer than Appalachia, that this public largesse to agribusiness has never resulted in widespread prosperity. Politically, it has meant that the price of entry into the political class in the Valley has been to climb in the pockets of federally subsidized agribusiness and its allies in finance, insurance and real estate development. The political static that comes from people wedged in those high pockets distorts reality, frequently persuades the public to act against its own interests, and produces local governments determined to conceal social, economic and environmental injustice.

Shocked as we are by Scripps Howard revelations of billionaires making money off farm subsidies, we note that in this Valley billionaires and multi-millionaires have been made by farm subsidies.

Badlands Journal editorial board

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Wade resigns presidency of East Merced Resource Conservation District

Submitted: Nov 21, 2007

Bernard Wade, president of the East Merced Resource Conservation District, resigned his office and board membership at the monthly EMRCD meeting Wednesday afternoon.

At a very tense meeting of the Merced River Stakeholders Monday, Wade, who has a riverfront property near Snelling, attempted several times to inject an element of rational explanation into the argument between MRS stakeholders and the EMRCD. The attack on the stakeholders by three of the five EMRCD board members attending the MRS meeting was led as usual by Merced County Planning Commissioner Cindy Lashbrook, who is also a paid staffer for the EMRCD and the Merced River Alliance and owns a farm on the river.

The speculation is that the EMRCD would not tolerate Wade's continual polite friendliness to members of the river stakeholders groups, even those who opposed the EMRCD grant as little more than a staff gravy train.

He closed his short letter of resignation to the EMRCD board with a line from Shakespeare: "The fault is not in our stars... but in ourselves."

Bernard Wade is a gentleman whose good manners, friendliness, ability to listen and tolerance of disagreement will be sorely missed in Merced County public affairs.

Badlands Journal editorial board

The critical spirit makes distinctions, and to distinguish is a sign of modernism. In modern culture the scientific community praises disagreement as a way to improve knowledge. For Ur-Fascism, disagreement is treason. Umberto Eco, ternal Fascism: Fourteen Ways of Looking at a Blackshirt

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Is growth inevitable?

Submitted: Nov 24, 2007

There are a number of planning processes going on in the San Joaquin Valley at the moment. They include the California Partnership for the San Joaquin Valley, the San Joaquin Valley Blueprint dealing with transportation planning, numerous general plan updates of counties and cities including Merced County and whatever proposals UC/Great Valley Center is fomenting. Although these planning processes are formally uncoordinated, they are closely linked by the guiding ideology of finance, insurance, real estate and large landholding interests: "Growth is inevitable."

Isn't it more likely that death and taxes are inevitable and that growth is merely desirable to some people in society? In fact, recent news suggests that growth may not even be possible in the near future, let alone inevitable.

If you read the local papers, you will see that in September Merced had the highest rate of households in some stage of foreclosure in the nation (one in 68 households). In October, Stockton came on strong with a rate of one in 31 households.

If you read the financial news, you will see that when reset time comes on the mortgages loaned in 2006 at the height of the speculative housing boom, foreclosure rates will rise.

If you read further in the financial section, you will see that most financial news is bad at the moment and that the speculative housing bubble, having burst, is spreading to credit card debt and auto loans and in fact to all securitized loans and to the banks and hedge funds. You will note articles that attribute falling stock-markets from the US to Germany to Shanghai to problems in the US mortgage-lending industry. You will also note that oil is very close to $100 a barrel now, which among other things is a hardship on the hundreds of thousands of commuters in the north San Joaquin Valley who drive to the Bay Area for work every day. You will also note bankruptcies among nationwide construction corporations and falling stock prices for those still standing.

Countrywide Financial sank 20.1 per cent on the week to $9.65 after analysts said the company could be affected if GSEs stopped buying its mortgages in the secondary market. However, the company said rumours that it would seek bankruptcy protection were "absolutely false".Meanwhile the big banks once again suffered a torrid week, precipitated by a Goldman Sachs analyst note that forecast another $48bn in writedowns by the end of 2008. Citigroup shed 6.8 per cent to $31.70 after the note said Citi could take $22bn in writedowns linked to its portfolio of collateralised debt obligations, $11bn this quarter, and $11bn next year.Homebuilder stocks were also punished amid a deepening malaise in the US real estate market.The S&P homebuilder index was down 14.3 per cent this week at 318.07, declining for six consecutive days before buyers sparked a rebound yesterday.Shares in Pulte Homes , shed 25 per cent of their value this week at $9.63. With house prices plummeting, nervous investors are keeping a careful eye on retail sales amid fears that belt-tightening consumers may deliver a poor shopping holiday season...
Elsewhere, General Motors was the Dow's biggest fallers this week, down 7.2 per cent at $27.16.-- Financial Times, Nov. 24, 2007

Recession appears now to be a more likely outcome of the speculative housing bubble than growth.

But, planners say: Now that we have the rooftops (setting aside for a moment whether the houses are inhabitated), the commercial development will come. All we need is more federal highway funds in one of the top two worst air-pollution basins in the nation as oil prices continue to escalate, they say. They also say that nothing bad can happen in Merced because we have the UC campus.

But more and more mainstream economists are saying that there has been something quite wrong with the way both residential and commercial real estate investment is handled in the US, and this mishandling is leading to global financial problems of a magnitude no one quite understands. No one is talking about any other kind of growth around here but residential and commercial real estate growth.

The slogan, "Growth is inevitable," in the San Joaquin Valley, which contains cities with the highest mortgage foreclosure rates in the nation, seems a little silly right now. The planners, politicians and special interests should come up with another slogan. If they are too rigid to invent a new slogan, perhaps the public could help them with something less rigid and more open, perhaps even a question like: "Is growth inevitable?"

Bill Hatch
----------------------

Notes:
Financial Times
Ailing mortage lenders set tone on Wall St...Chris Bryant in New York...11-23-07
http://www.ft.com/cms/s/1df0301e-990e-11dc-bb45-0000779fd2ac,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F1df0301e-990e-11dc-bb45-0000779fd2ac.html&_i_referer=http%3A%2F%2Fwww.ft.com%2Fhome%2Fus

ECB set to pump cash into money markets...Ralph Atkins and Ivar Simensen in Frankfurt and David Oakley in London...11-23-07
http://www.ft.com/cms/s/6a8adc9a-99b7-11dc-ad70-0000779fd2ac,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F6a8adc9a-99b7-11dc-ad70-0000779fd2ac.html&_i_referer=http%3A%2F%2Fwww.ft.com%2Fhome%2Fus

CounterPunch.com
"A Generalized Meltdown of Financial Institutions"
Take a Look at Professor Roubini's Crystal Ball...MIKE WHITNEY...11-24-07
http://www.counterpunch.com/whitney11242007.html

Nouriel Roubini's Global EconoMonitor
The Next Shoe to Drop in the Credit Meltdown: Commercial Real Estate and Its Massive Forthcoming Losses...Nouriel Roubini...11-14-07
http://www.rgemonitor.com/blog/roubini/226654/

The Housing Bubble
http://thehousingbubbleblog.com/index.html

Center for Economic and Policy Research: Housing
http://www.cepr.net/component/option,com_issues/task,view_issue/issue,11/Itemid,22/

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Department of Interior admits MacDonald wrongdoing

Submitted: Nov 27, 2007

Press release from House Natural Resources Committee on Julia MacDonald. The Department of Interior admitted to the committee that MacDonald interferred with the US Fish & Wildlife Service on behalf of special interests in several Endangered Species Act cases. Two of those cases occurred in Merced County.
Badlands Journal editorial board

------------------------

November 27, 2007

CONTACT:
Allyson Groff, 202-226-9019
Allyson L. Groff

Communications Director
Committee on Natural Resources
U.S. House of Representatives
http://resourcescommittee.house.gov

Rahall: Interior Concedes MacDonald Meddled with Science

Washington, D.C. – In response to months of allegations about political tinkering within its own ranks and demands for reviews by House Natural Resources Committee Chairman Nick J. Rahall (D-WV), the Department of the Interior today conceded that seven out of eight decisions made during the tenure of Julie MacDonald, former Deputy Assistant Secretary for Fish and Wildlife and Parks, warrant revision.

“Julie MacDonald, who was a civil engineer by training, should never have been allowed near the endangered species program. This announcement is the latest illustration of the depth of incompetence at the highest levels of management within the Interior Department and breadth of this Administration’s penchant for torpedoing science. Today we hear that seven out of eight decisions she made need to be scrapped, causing us once again to question the integrity of the entire program under her watch,” Rahall said.

Rahall has repeatedly pressed the agency to review possible political tampering within its ranks. A May 9 oversight hearing, called in the aftermath of a scathing Inspector General report, examined MacDonald’s role in politicizing the Endangered Species Act (ESA). Following up, Rahall sent two letters, dated May 17 and June 20, to Interior’s Deputy Secretary Lynn Scarlett, requesting a departmental review of a number of ESA listing decisions made during MacDonald’s service.

The latest announcement outlines seven specific ESA decisions that Interior has determined were “inappropriately influenced” by MacDonald. The Fish and Wildlife Service had announced on July 20 that it intended to review eight ESA decisions where it appeared that MacDonald had played a significant role in asserting her own political interests to overrule scientific decisions on endangered species recovery.

“Julie MacDonald’s dubious leadership and waste of taxpayer dollars will now force the agency to divert precious time, attention, and resources to go back and see that the work is done in a reliable and untainted manner. The agency turned a blind eye to her actions – the repercussions of which will not only hurt American taxpayers, but could also imperil the future of the very creatures that the endangered species program intends to protect,” Rahall said.
..............................

Contact: Leda Huta, (202) 320-6467

Sarah Matsumoto (510) 520-1004

US FISH AND WILDLIFE SERVICE TO REVISE 7 ENDANGERED SPECIES DECISIONS TAINTED BY CORRUPTION

Press Statement of Leda Huta, Executive Director, Endangered Species Coalition

Washington, DC- “The Endangered Species Coalition welcomes the news that the U.S. Fish and Wildlife Service will revise seven endangered and threatened species decisions improperly influenced by political appointees.

“We are heartened to hear that the Canadian lynx, the California red-legged frog, the Preble’s meadow jumping mouse and other species on the brink of extinction may finally receive the protections they urgently need. However, this should be the first step in a complete investigation into the Bush Administration’s corruption and political manipulation of decisions affecting our nation’s endangered species.

“This is the tip of the iceberg in terms of endangered species protections that have been weakened by political manipulations. The depth of the Bush Administration’s corruption and suppression of science has not yet been fully uncovered.

“We call on President Bush to reexamine all cases where there is documented evidence that Department of Interior officials interfered with scientific decisions. Interior Secretary Dirk Kempthorne and U.S. Fish and Wildlife Service Director Dale Hall must ensure that this process is open and transparent and that the decisions be made based on science rather than politics.

“The Bush Administration has a long history of corruption and political interference in scientific decision making in endangered species decisions. A report released in March by the Inspector General of the Department of Interior found that Assistant Secretary of Fish, Wildlife and Parks Julie MacDonald rode roughshod over numerous decisions by agency scientists concerning protection of the nation’s endangered species. The report also found that MacDonald violated federal rules by sending internal documents to industry lobbyists with ChevronTexaco, the Pacific Legal Foundation, California Farm Bureau, and others.

“We thank the members of the House Natural Resources Committee for holding oversight hearings regarding many of these decisions as well as other cases of political interference in endangered species decisions. We welcome the opportunity to work with Congress to ensure that this is a complete and thorough examination so that species on the brink of extinction receive the protections they deserve.”

As the guardian of the Endangered Species Act of 1973 (ESA) and the wildlife it protects, the Endangered Species Coalition (ESC) is composed of 380 environmental, conservation, religious, scientific, humane, sporting and business groups around the country. Our tools are public education, scientific information and citizen participation in decisions affecting the fate of at-risk species. Through extensive grassroots work, education, discussions with lawmakers, and the dissemination of information, we work to ensure that the Act itself, as well as all endangered animals and plants, can be passed on safely into the future.

###

Sarah Matsumoto
Deputy Director
Endangered Species Coalition
Oakland, CA
(510) 520-1004
smatsumoto@stopextinction.org
www.stopextinction.org

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Vern Williams

Submitted: Nov 28, 2007

I mourn the passing of Vern Williams and extend condolences to his family and his many friends and colleagues. I cannot yet imagine Vern absent from a newsroom somewhere, perhaps convening one of his incomparable "Come to Jesus" meetings to calmly restore order when it has broken down.
Bill Hatch

Merced Sun-Star
Tuesday, Nov. 27, 2007
Former Sun-Star editor, 'skilled newsman,' loses battle with cancer
By DOANE YAWGER
http://www.mercedsunstar.com/167/story/83422.html

Vern Williams

Vern Williams, a calm and steadying influence on Merced and Modesto journalism for 43 years, died early Monday morning at his Merced home after a lengthy battle with cancer. He was 62.

Williams, most recently the photo editor at the Modesto Bee, began his career as an apprentice printer at the Merced Sun-Star and advanced to positions as Linotype operator, sports editor, editor of the Sunday Sun, a short-lived Sunday newspaper, and ultimately managing editor before moving to the Modesto Bee seven years ago.

Funeral arrangements are pending for Williams, a lifelong Mercedian who also excelled in fast-pitch softball and loved all sports, particularly baseball and golf.

"He was a class act," Mike Conway said. "He managed to remain cool no matter what the pressure. He exuded calmness and confidence and always was the coolest head in the crowd."

Conway, now the city of Merced's public information officer, worked with Williams at both Merced and Modesto newspapers. He said Williams was always there when you needed him, was a positive influence on many people and had good news sense.

Frank Thompson, the Sun-Star's production manager for 31 years, hired Williams in 1964 and said he was a fine employee. He had graduated from Merced High School the previous year.

"He followed orders real good; he was a fine worker and always conscientious. He could do anything in the composing room and could be trusted," Thompson said. In his early days at the Sun-Star, he was a linotype operator and later worked in the camera room when the paper advanced from what was called letterpress or "hot type" to offset "cold type" operations.

"You couldn't help but like Vern -- and respect him as well," said Mark S. Vasché, the Modesto Bee's editor and senior vice president. "He was a dedicated and skilled newsman. More important, though, he was an all-around good person -- a man of integrity and character, with a quiet strength and a heart of gold. He will be missed by all who knew and worked with him."

Williams joined The Bee in 2000 as a copy editor on the paper's news desk. In 2004 he was named director of photography, overseeing the paper's photo and video operation.

Smokey Thomas of El Nido, who retired in May as the Sun-Star's press foreman, said he and Williams used to have fun together years ago on fishing trips and playing cards.

"He was always a helluva nice guy and a good friend," Thomas said.

Joe Cortez knew Williams for 21 years, when he was hired as a "stringer" or part-time correspondent to cover local sports events. Now a copy editor at the Bee, Cortez said he was just an aimless kid but Williams saw an aptitude for sports and writing in him.

"He took me under his wing," Cortez said. "The man had given me a career, a path in life. In the newspaper world with the landscape ever-shifting, with deadlines and rewrites, I've never met anyone who kept his head in a crisis in the way Vern did."

What started out as a boss-employee relationship just evolved, Cortez said, with Williams becoming a tremendous friend.

Williams' last day at work was Oct. 26.

Williams became the Sun-Star's sports editor on June 1, 1985 and became managing editor about 10 years later. He was a member of the Three Gateways Sportsmen's Club and was an active booster of both Golden Valley High School's football and band programs.

Williams is survived by his wife of 44 years, Kathie; three sons, Jeff, Chris and Andrew, all of Merced; a niece, Ruth Sweatt of Galt; and three granddaughters, Ashlie, Amberlee and Elizabeth Williams.

Dave Lyghtle, the Modesto Bee's assistant managing editor, also praised Williams on personal and professional levels.

"Personally, it's been a rough day up here," Lyghtle said. "Those of us who worked with Vern the past seven years really, really admired him -- respect that was cultivated long before his cancer diagnosis. In our hearts, we knew this day was coming, but the suddenness took us by surprise. He will be very much missed."

Mike Bradley, currently the Sun-Star's press foreman, knew Williams since 1970 when he started in the newspaper's composing room. He joined other Sun-Star employees at card parties Williams periodically hosted.

"He was pretty even-keeled, always a nice guy. I enjoyed working with him," Bradley said.

Bobby Dallas, of Atwater, played fast-pitch softball with Williams on the ASA Major Division national champions and said he was a mentor to him and his brother Tommy.

Williams, who went from being a catcher to coaching, was a big part in the team's success, Dallas said.

"Vern recruited me to play. He was a super guy to be with. The team was a dream of his and Norm Marasti's. He was a good person," Dallas said.

Former Sun-Star wire editor Rick Albright came to work at the Sun-Star only months after Williams started. He remembers Williams' early duties involved dumping bins of old lead type from that day's newspaper and then working setting type on one of the newspaper's linotype machines.

Albright also remembers hearing stories of Williams' travels with the California Kings' national championship men's major division fast-pitch softball team in 1984. Williams always played catcher during high school and adult softball careers.

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