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Contact: Jolie Holland’s Sound Goes "Huge"

Mother Jones

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Jolie Holland in Brooklyn. Jacob Blickenstaff

Since the release of her 2003 album, Catalpa, Jolie Holland‘s music has evolved from close adaptations of pre-war blues and ballads into deeper, more complex works. Holland grew up in Houston, boxed up inside a strictly religious family. She left home after high school and was essentially homeless for more than years, squatting and bouncing between Houston, Austin, and New Orleans. In this environment, her musical education was direct and unmediatedthe music of Blind Willie McTell as influential and intoxicating as that of John Cage.

Holland has often been pigeonholed as a folk-blues-soul singer, but even from the beginning there has been something experimental and immediate about her approach. With Wine Dark Sea, her just-released sixth album, Holland exerts more control as a bandleader, setting her voice, as serpentine and wily as a rattlesnake at a Pentecostal meeting, against a more improvisational ensemble consisting of two drummers, three additional guitarists, bass and reeds. Photographer Jacob Blickenstaff spoke with Holland recently in New York City. The following is in her words.

I have a really tight relationship with the I Ching. You can see the lyrical influence all over the record. One of the basic statements of the I Ching is there’s a time when the most effective thing is to just do nothing. It’s really enormous. It’s about the flow of circumstance and of seasons. Songs like “Waiting for the Sun,” “All the Love,” and even the Joe Tex cover, “The Love You Save,” say that:

I want you to stop! Find out what’s wrong
Get it right or leave love alone
Because the love you save today
May very well be your own

Observation and engagement with ideas without explicit teachers is the global norm of how to learn things. So many people aren’t ready to go to art or music school, because it destroys their own agency in the work. I remember that feeling when I was a young teenager and was learning how to play. When you’re an undeveloped musician or artist, learning too much about theory can put the cart in front of the horse.

The voice is at the center of the compositions. You have to make sure that the band is augmenting that while expressing themselves, but at the same time not flattening out that complexity. Indigo Street takes the first solo on the record on “On and On.” When I gave her direction for that solo, I said I just wanted her to sound like she didn’t know what a guitar was, like something started a fire in her hand. I’ve been playing with her for a long time and I was trying to get her to play more noise. But with the absence of drums, it was harder for her to feel like she could go there. She said that me having a “pretty” voice held her back.

The approach on this album is more about bandleading than anything else. On past albums, I couldn’t get people to do what I wanted them to do. More volume helped; getting more people on stage and not being polite. A track like “Wine Dark Sea” is totally huge. There are no overdubs on that song, we’re playing live. To make this album we had to find the right room to get two full drum sets in with enough separation to record but still together. There are three electric guitar players in that same room. I was in the isolation booth with piano or guitar. Recording it was a real challenge. Douglas Jenkins, my co-producer, had never engineered something like that before.

We developed the sound during a weekly residency at a small place called the Jalopy Theater in Brooklyn. We’d have two drum sets on the stage and we’d go through the songs, and then we’d also have an improvisation set. I would tell stories from the book that I’m working on—true ghost stories and strange occurrences told to me by friends—and the band would play behind me so they could get used to moving together. I think some of my nerdier fans didn’t like it but fuck it. I warned them, “This is not a normal show.”

My friend Stefan Jecusco has a great saying: “It’s impossible to be sexy and nostalgic at the same time.” Most people listen to old music and they experience it as nostalgic; they can’t get inside it and don’t have a nonlinear sense of history. When I first heard Blind Willie McTell, I just had a crush on him, it just felt real even though he was speaking and playing in a different way than people do now. I hear melody in a more complicated way than other people do—so much of it comes from Blind Willie McTell. He is the guy who taught me how to sing. It’s all about microtones and internal phrases.

One thing about old songs, if we are listening to them now, then we know they’re good. They went through the filter, they stood the test of time: McTell, Stevie Wonder, Prince, Beyoncé—a good song is a good song.

With singing covers, it’s not nostalgia; it’s happening right now. Being on stage is a responsibility, an opportunity. All of these people are paying attention to you. Your present psychological experience will be affecting everyone. The more you can release your resistance to being in the present moment, the more you are providing people an opportunity to do the same. If you are playing a song that you wrote, then you are still covering that song.

I love what Tom Waits said: “We all love music, but what we all really want is music to love us.” That kind of unity in your being on stage is what has that power. ­­

“Contact” is series of portraits and conversations with musicians by Jacob Blickenstaff.

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Contact: Jolie Holland’s Sound Goes "Huge"

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From the Mao Generation to the Me Generation: Tales From the New China

Mother Jones

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Evan Osnos in New York City, May 2014. James West

When Evan Osnos first arrived in Beijing as a college student in 1996, China was a different country. The economy was smaller than Italy’s. The Internet was a nascent, little-known thing. Despite nearly 20 years of economic reforms and opening up to the West, Chinese people still rejected imports like Hollywood and McDonald’s.

“Cameras had failed to convey how much closer it was, in spirit and geography, to the windswept plains of Mongolia than to the neon lights of Hong Kong,” Osnos writes of that time in Age of Ambition: Chasing Fortune, Truth, and Faith in the New China, his new book on modern China. Soon, everything would change.

Two years later, Osnos returned for a summer to find that a feverish desire to consume—houses, Cokes, meat—had taken hold. A new magazine called the Guide to Purchasing Upscale Goods published stories with titles like “After the Divorce, Who Gets the House?” A new Communist Party slogan proclaimed “Borrow Money to Realize Your Dreams.”

By the time Osnos relocated to China in 2005, first as a reporter for the Chicago Tribune and later as one for the New Yorker, “China was building the square-foot equivalent of Rome every two weeks.”

How does one tell the story of a place changing so rapidly that the outside observer can hardly keep up? In his book, released just last week, Osnos argues that the country’s remarkable growth has unleashed an age of possibility for Chinese citizens, an unprecedented fervor for chasing dreams and soul-searching. For eight years, Osnos followed the lives of Chinese people tugged by these tides of change: A peasant’s daughter turned online dating tycoon, a young political scientist and ardent defender of China’s one-party system, a street sweeper moonlighting as a poet, a political dissident revered abroad but erased at home, corrupt officials that make Washington look like child’s play.

Through these stories Osnos traces the cadence of everyday life that often gets lost amid modern China’s played-out superlatives. Now living in Washington, DC, Osnos spoke to Mother Jones about his run-ins with the Great Firewall, overnight moguls, pollution, and why now’s the golden age for foreign correspondents in China.

Mother Jones: What are the most notable ways China has changed since you first visited?

Evan Osnos: This is one of the things that’s thrilling about China’s metamorphosis, which is really what it is. It’s how physical it is. When I lived in Beijing in 1996, it was a horizontal city. If you wanted to go out for a burger, if you wanted to really treat yourself, you went to this place called the Jianguo Hotel. The architect had proudly described it as a perfect replica of a Holiday Inn that he had seen in Palo Alto, California. It’s exactly what you would imagine a Palo Alto Holiday Inn looks like.

Now, of course, 40 percent of the skyscrapers under construction worldwide are in China. It’s rare, if you look back through history, there are these moments—we had one in the United States, there was one in the UK—where countries just physically transform themselves. That was quite striking.

MJ: In your book, you also talk about China’s intangible transformations.

EO: In the end, it was the non physical transformation that became the subject of this book. It was this very private, and in some ways kind of intimate, change in the way people saw themselves as citizens, as members of the society. Traditionally you saw yourself as a member of a group: the family, then the village, then the factory, and then of course the country at large.

I think a generation ago, people in China would have always talked about the collective. Today, the Chinese call it the “Me” generation, because that’s exactly what it is, people who are able and quite determined to think about their own lives in ways that are specific, idiosyncratic, and infused with personal choice. They imagine themselves to be the actor at the center of this drama. That’s a transformation. It’s meaningful in all kinds of ways—politically, economically, socially.

Sunday shoppers stroll Wangfujing Street, Beijing, April 1985. Neal Ulevich/AP

MJ: In a recent op-ed in the New York Times, you wrote about trying to publish a Chinese edition of this book. Local publishers wanted to significantly revise or censor politically sensitive sentences. Were you surprised at by this, given the book prominently features Tiananmen and the June 4th protests, and dissidents like Chen Guangcheng, Liu Xiaobo, and Shi Tao?

EO: After I had written the book in English, the question I’d been thinking about for a long time is how to get this to a Chinese audience. Chinese readers are buying books in translation, particularly non-fiction about China, in large numbers. That’s exciting and important—it actually feels like a fair trade: I’ve been there writing about their country, and I like the idea of being able to put my story back into their hands, partly for accountability’s sake. If they say this doesn’t ring true, then I’ve learned something.

The problem is that in order to publish a book in mainland China, you have to agree to be subject to censorship. That’s the nature of the system. I don’t challenge that system on its face. It’s their system. But as an author I have a choice to make whether I’ll participate or I won’t. And when they came back and said ‘Here are the cuts you have to make. You won’t be able to talk about dissidents like Chen Guangcheng or Ai Weiwei, we don’t want you to talk about Chinese history in a certain way.’

I decided that that’s not something that I can do. If I give a portrait to the Chinese public of themselves that’s not actually how I see the world and how they look to me, that’s not an honest accounting. It would be as odd as if somebody came to the United States and wrote a book about the last 100 years and said, ‘You know, I don’t want to write about the Civil Rights Movement because it’s sensitive, awkward, and uncomfortable. So let’s just not talk about that.’ I felt like I couldn’t do the equivalent in Chinese.

MJ: One of the themes you return to throughout the book is how decades of economic development has unleashed a sense of ambition among Chinese citizens, to seek fortune, information, and a sense of self. But as you point out, these forces have run up against limits under China’s authoritarian regime. When did these limits first become clear to you?

EO: When I first moved there, I was overwhelmed by the sense of aspiration. All of a sudden, people who had never really had the opportunity to define their own goals in life had embraced that. There was a woman named Gong Haiyan who I wrote about when she was just out of graduate school, and all of a sudden she was taking her company public on the stock exchange, and got very wealthy. That seemed like in its own way a symbol of this moment in China.

Then over and over I started running into people whose aspirations had led them into a confrontation with the state, Ai Weiwei being perhaps the most dramatic example. He was obviously using his art in a way that he thought was going to advance certain political objectives. He found out he couldn’t do that, and in some sense my interactions with Ai Weiwei focused my attention on that confrontation, on that collision.

It wasn’t just unfolding in the lives of people as unusual as Ai Weiwei, it was in fact unfolding in microscopic ways all over the country. For instance, if you’re a small-time entrepreneur, and you’re in a city in which you need a license to operate a business, and you discover that you can’t get a license to operate that business unless you know somebody.

MJ: Give us an example of how the Chinese government’s restrictions on access to information, like the Great Firewall of China, got in the way of your reporting.

EO: If you’re trying to write about what the Chinese people are talking about, you can sometimes get a distorted picture if you go online and look at the conversation on social media. You’ll discover that people are not really talking about Bo Xilai—the big corruption case of a couple of years ago—or you might find that people are not talking about the latest political rumors the way you would expect them to. The truth is, they are talking about them, but they’re being censored and they’re being removed in real time.

For some of us as foreigners, we can go to China and it is a wonderful place. It’s a place I love and it’s been a part of my life for 20 years and it will continue to be. But if you go to China and all you see is these new skyscrapers and this sense of progression and openness, you’re not seeing the country as it truly is.

MJ: You’ve written a lot about China’s crackdown on the web. Has the Internet actually expanded creative and individual freedom in China, or has it merely created the illusion of freedom?

EO: Great question. There’s no question that the internet has created a greater sense of intellectual possibility. The greatest example is somebody I met towards the end of my time there, a guy I write about in the book, who’s a street sweeper. When you meet him, you think ‘I understand the contours of his life. He’s not a person with an intellectual outlet.’ He said to me, ‘Everybody thinks that I don’t have an education. And what they don’t know, what they don’t understand, is that I’m a poet. I’m the host of a forum online for modern Chinese poetry.’ At first I thought the guy was unhinged. And then I went online and discovered that it was true. He really did have an entire universe that he had created and was a part of. There were people that he knew, and there were poetry competitions that he’d won.

This was really important in understanding what the Internet allows people to do. There are limitations, but I think there’s a danger in imagining that the limitations means that there’s not substance.

MJ: His poetry was quite good!

EO: He was ambitious in his poetry. He was not doing small bore stuff. He saw himself as a descendent of Mao, and Mao, after all, was a poet. He really believed that there was nobility and dignity in trying to put ideas to paper. It simply wasn’t available to him before the internet. If we think the internet is transformative for us in the United States, imagine how transformative it is for people in China who are otherwise living in these fairly isolated areas.

MJ: What did you find most challenging about writing about the complexities of life in modern China for an American audience?

EO: You have to figure out a way as a writer to capture idiosyncrasy, what is it that makes it distinctive without making it overly exotic. It’s very easy when you’re a writer talking about this very distant place to take the names of streets and translate them back into English, and make them sound almost other worldly. I used to live on Cotton Flower Alley, for instance, and I lived next to Pineapple Junction.

There is a way of over-exotifying a place, when in fact my goal is that by describing Chinese people as they are, and as they really live, that I will allow American readers to see them as they appear to me: they’re much, much more like us than I think we ever imagined them to be.

MJ: What have you found to be the biggest shortcomings in the outside world’s view of China?

EO: It’s funny, actually, I’m sort of complimentary of the journalism on China these days. This is not just because the folks doing it are my friends. As much as we talk about the troubles that foreign journalists have in China today—and they’re substantial—this is a golden age for foreign correspondents in China because technology allows us to travel the country faster and farther than we ever have before, and it allows you to be in touch with the rest of the world, so you can understand what the rest of the world understands about China, and what they don’t.

And also I think the journalists who are there are self selecting. Nobody gets sent to China these days. You go because you’ve fought hard to get there: You’ve probably studied the language, you’ve studied the place. So there’s people there who are determined to capture it.

Inevitably, our image of China just simply can’t keep up with the changes inside the country. Everything is happening in China at exponential speed. Maybe you would have said, five years ago, that people in China were feeling good about their economic status. If you said that today, people on the ground in Beijing would say you’re out of touch, because it’s changed substantially. It’s hard to keep up.

MJ: So just how bad was the air pollution?

EO: Over the last few years air quality has reached a kind of tipping point in the public consciousness where conditions that people used to accept, they no longer accept. Part of that is that they feel the effects on their health, and part of that is about information: They now have access to numbers that were never available before. They’re about to read what it is that they’re inhaling. But really, more importantly—and I think this is critical—they know what their children are inhaling. That’s had a metabolic effect on the politics of pollution.

The entire Chinese political enterprise is founded on a bargain: ‘we will make your lives better, if you’ll allow us to stay in power.’ That has been the bargain for the last 30 years. In order to maintain power, the party basically has to ensure that people still believe that their lives are getting better.

I think a few years ago people defined “getting better” in a different way than they do today. It used to be that if your income was getting a little bit higher every year, you were reasonably satisfied. Today, people are thickening their conception of what it means to live a good life. And they’re demanding more things, like clean air for instance, and safe water.

MJ: In a recent interview with the Wall Street Journal, you recalled speaking at a conference a few years back where you warned that corruption was going to be a bigger issue. You said that back then a lot of people disagreed with you. But you turned out to be right. If you had to guess, what emerging issues do you expect will be important in the coming years?

EO: We should be humble about our ability to predict this place. The longer you’re there, the less comfortable you are making predictions, because you realize just how hard it is to get it right.

But I do think that if I was making a list of the issues that are going to be the most important in China’s future, the environment is really near the top. It’s an issue that in the past was not a political factor, and all of a sudden it’s become a political factor. I think that changes where the country can go, because all of a sudden they have to figure out how to reward people in different ways: They can’t allow the economy to grow at the kind of unbridled speed that it had before.

Anybody who’s spent a lot of time there has seen people who are just willing to do absolutely everything in order to will themselves from one place in life to another place in life. In China today, if you’re not moving forward, then you are moving backwards. That’s still the dominant ethos. That’s not going to change.

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From the Mao Generation to the Me Generation: Tales From the New China

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WATCH: These Reefs Are Beautiful—But Most of the Coral Is Dead

Mother Jones

Grand Cayman Island is a speck of white sand about twice the size of Manhattan floating in the Caribbean Sea halfway between Cuba and Belize. It’s known mainly as an offshore tax haven—”Wolf of Wall Street” Jordan Belfort spoke to a gathering of business leaders there recently—and as a stopover for cruise ships packed with sunburned Americans sipping bright blue cocktails with paper umbrellas.

It’s also a key haven of marine biodiversity, sporting 36 different coral species (corals are tiny animals that build rock-like reef structures) and 350 kinds of fish. Generally speaking, coral reefs are some of the most ecologically rich habitats on Earth, supporting 25 percent of marine life in less than one percent of the ocean environment. They’re a first line of defense for coastal communities against devastating storm surges. In Cayman, as in many small island nations, reefs are the backbone of the local tourism and subsistence fishing industries. And they’re rapidly dying off.

A study published last October found that on reefs around Little Cayman, a kind of suburb island adjacent to Grand Cayman, coral cover fell from 26 to 14 percent just between 1999 and 2004. Since the early 1980s, coral cover across the entire Caribbean has plummeted 80 percent, so that living corals now cover only 10 percent, on average, of available surface area. And a 2011 report from the World Resources Institute that labeled reefs around Grand Cayman as highly threatened found that what’s happening there is a microcosm of a global trend: 90 percent of the world’s coral will be at risk of disappearance by 2030, thanks primarily to ocean acidification and global warming, both products of greenhouse gases released by human activity.

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WATCH: These Reefs Are Beautiful—But Most of the Coral Is Dead

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Anger at the Plutocracy Isn’t Strong Enough to Make a Big Difference in November

Mother Jones

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Greg Sargent writes today that the Democratic strategy of going after the Koch brothers isn’t about the Kochs per se, but “a gamble on what swing voters think has happened to the economy, and on the reasons struggling Americans think they aren’t getting ahead”:

Dems are making an argument about what has happened to the economy, and which party actually has a plan to do something about it. Today’s NBC/WSJ poll finds support for the general idea that the economy is not distributing gains fairly and is rigged against ordinary Americans….The Democratic case is that the all-Obamacare-all-the-time message is merely meant to mask the GOP’s lack of any actual affirmative economic agenda, and even reveals the GOP’s priorities remain to roll back any efforts by Dems to ameliorate economic insecurity.

….I don’t know if the Dem strategy will work.

I think Sargent’s skepticism is warranted. The problem is that the NBC/WSJ poll he mentions doesn’t find an awful lot of evidence for seething anger. Here are the basic results:

Those are not really huge margins. The first question in particular is one they’ve been asking for two decades, and 55-39 is a very typical result, especially during times of economic weakness.

Given this, and given the extreme difficulty of a party in power taking advantage of economic discontent, will the Democratic strategy of bludgeoning Republicans over their plutocratic leanings work? I doubt it. Specific agenda items like a higher minimum wage, health care success stories, and universal pre-K seem more likely to work. At the margins, a bit of Koch bashing and a few high-profile Wall Street indictments might help a bit too, but only as an added fillip.

Oh, and a nice, short, decisive war against some minor global bad guy would also do wonders. In October, maybe.

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Anger at the Plutocracy Isn’t Strong Enough to Make a Big Difference in November

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John Boehner Speaks Up For Main Street Republicanism

Mother Jones

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I’ve always felt a little sorry for John Boehner. In another era—a non-tea party era—he would have been your basic Main Street Republican, willing to cut compromises to keep the country moving along in a tolerably orderly way. The kind of guy who would have taken his cues from the Middletown Rotary Club.

Speaking of which, Boehner spoke to the Middletown Rotary Club yesterday and let his hair down. For most Republicans, this would have meant getting caught making some kind of incendiary remarks about Obama thuggery and class warfare against job creators. In Boehner’s case, it meant some incendiary remarks about the, um, unrealistic attitudes of the more excitable members of his caucus:

On immigration: “Here’s the attitude. Ohhhh. Don’t make me do this. Ohhhh. This is too hard,” Boehner whined before a luncheon crowd at Brown’s Run County Club in Madison Township. “We get elected to make choices. We get elected to solve problems and it’s remarkable to me how many of my colleagues just don’t want to … They’ll take the path of least resistance.”

On Obamacare: “(To) repeal Obamacare … isn’t the answer. The answer is repeal and replace. The challenge is that Obamacare is the law of the land. It is there and it has driven all types of changes in our health care delivery system. You can’t recreate an insurance market over night.”

On the tea party: “I don’t have any issue with the tea party. I have issues with organizations in Washington who raise money purporting to represent the tea party, those organizations who are against a budget deal the president and I cut that will save $2.4 trillion over 10 years….I made it pretty clear I’ll stand with the tea party but I’m not standing with these three or four groups in Washington who are using the tea party for their own personal benefit.”

This is all about pragmatism, a cri de coeur against the Foxification of the Republican Party. And I guess it means one of two things. Either Boehner doesn’t really care much about holding onto his leadership position anymore, or else he’s sensed that there’s a burgeoning Main Street backlash against the radicalism of the tea party wing of the modern GOP.

Boehner has always wanted to govern, and he’s never believed that compromise was surrender. That’s not the kind of pol he is. But he’s been hemmed in by the demands of the tea party, and now maybe he’s starting to think it’s time to bust out. The Middletown Rotary Club is probably more interested in keeping things on an even keel than in endless confrontation and hostage taking that does nothing except hurt the economy. They think immigration reform is good for business, and even if they don’t like Obamacare, they probably understand by now that it’s not a catastrophe and it’s time to make the best of it. Maybe they’re finally starting to find their voice.

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John Boehner Speaks Up For Main Street Republicanism

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Meet the New Super Working Class

Mother Jones

Via Counterparties, a new study suggests that we now have a “superordinate” working class: highly paid professionals who are so dedicated to their professions that they’d rather work in the office than engage in leisure or vacation time:

The best educated men used once to work much shorter hours for pay, an echo, still in the 1960s, of the end-of-19th century leisure-class ideology. But by the beginning of the 21st century they are working the longest hours in their exchange-economy jobs. And the best-educated women in each of the regime types, show an even more decisive differential movement into paid work.

Now add these trends together and we see, unambiguously, the 21st century reversed education/leisure gradient, with the best educated, both men and women, working, overall, a much larger part of the day than the medium-level educated, who in turn do more than the lowest educated. At least from the 1970s onwards, we see no decisive decline in overall work time, perhaps the slightly the reverse, with a small historical increase, particularly for the best educated, in the range 530 to 550 minutes per day. Industrious activities are transferred out of the money economy, and, replacing the 19th century leisure class, we find a 21st century superordinate working class.

The basic evidence is on the right. I guess I find it only modestly convincing. In 1961, highly educated men in the corporate world worked similar hours to their less-educated peers. By 2005, they were working a bit more, but their total work hours were actually down from their peak. Conversely, although it’s true that highly educated women have very plainly outpaced the working hours of their less-educated peers, this is hardly surprising given the immense change in opportunities allowed to women since 1961, as well as the vastly higher pay that well-educated women can now expect in the corporate world.

So yes: highly-educated professionals are working more than they used to. Are they working themselves into a new, 21st-century frenzy, though? The evidence for that seems fairly modest. The big story here seems to be a more prosaic one: women are basically catching up to men, which hardly comes as a surprise. Beyond that, though, the evidence for a rising Veblenesque warrior class that views long hours as a status symbol strikes me as weak. Obviously it exists in places like Wall Street and Silicon Valley, but I suspect that its broader impact is fairly limited.

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Meet the New Super Working Class

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Watch Elizabeth Warren Go After Paul Ryan for Blaming Unemployment on the Unemployed

Mother Jones

Last month, Paul Ryan generated a minor media storm for a racially tinged comment lamenting the supposedly weak “culture of work” among “inner city” men. “We have got this tailspin of culture, in our inner cities in particular, of men not working and just generations of men not even thinking about working or learning the value and the culture of work,” Ryan told conservative radio host Bill Bennett. “There is a real culture problem here that has to be dealt with.” Ryan later said that he had been “inarticulate” and forswore any racial meaning in his comments. He was, he promised, referring to our entire culture; not “the culture of one community.”

Now, you either buy that or you don’t. If you don’t think there is something racially loaded about decrying the lack of work ethic among inner city men, then I’m probably not going to be able to convince you that there is. (But there probably is.)

Either way, Ryan’s defense could be interpreted as amounting largely to, I was not saying black people are lazy. I was saying poor people are lazy. This is a myth about poverty. It is not true. (Really.)

Enter Elizabeth Warren. “Paul Ryan looks around, sees three unemployed workers for every job opening in America, and blames the people who can’t find a job,” the senior Senator from Massachusetts said in a speech at the Minnesota Democratic-Farmer-Labor’s Humphrey-Mondale Dinner on March 29th.

Paul Ryan says don’t blame Wall Street: the guys who made billions of dollars cheating American families. Don’t blame decades of deregulation that took the cops off the beat while the big banks looted the American economy. Don’t blame the Republican Secretary of the Treasury, and the Republican president who set in motion a no-strings-attached bailout for the biggest banks – Nope. Paul Ryan says keep the monies flowing to the powerful corporations, keep their huge tax breaks, keep the special deals for the too-big-to-fail banks and put the blame on hardworking, play-by-the-rules Americans who lost their jobs. That may be Paul Ryan’s vision of how America works, but that is not our vision of this great country.

Warren is an increasingly popular figure and is set to play a large role in the Democratic fight to maintain control of the Senate in November.

Here’s the whole speech:

(via The Huffington Post)

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Watch Elizabeth Warren Go After Paul Ryan for Blaming Unemployment on the Unemployed

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In Defense of "Flash Boys"

Mother Jones

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Felix Salmon reviews Michael Lewis’s Flash Boys today, and he’s not impressed. I think Salmon’s basic criticism is on point: the big problem with high-frequency trading isn’t that small investors get ripped off, it’s that the system is so complex that literally no one really understands how it works or what kind of danger it poses:

By far the biggest risk posed by the HFT industry, for instance, is the risk of the kind of event we saw during the flash crash, only much, much worse. The stock market is an insanely complex system, which can fail in unpredictable and catastrophic ways; the HFT industry only serves to make it much more brittle and perilous than it already was. But in Lewis’ book-length treatment of HFT, he barely mentions this risk: I found just one en passant mention of “the instability introduced into the system when its primary goal is no longer stability but speed,” on Page 265, but no elaboration of that idea.

HFT cheerleaders like to brag that their algorithms increase liquidity. And that’s probably true. The problem is that HFTs don’t guarantee liquidity. In fact, it’s far worse than that: they displace other sources of liquidity during normal times, but there’s a good chance that during a crisis, at precisely the moment when liquidity is most important, HFT traders could suddenly and systematically exit the market because events have outrun the parameters of their algorithms. This could easily spiral out of control, turning a bad situation into a catastrophe.

Is this a real threat? Nobody knows. And that’s the problem. HFT is so complex that literally no one knows how it works or how it will react in a crisis. This is not a recipe for financial stability.

Unfortunately, that doesn’t make for a very entertaining book, so Lewis instead focuses on the ability of HFT shops to “front run” orders in the stock market—that is, to see bids a few milliseconds before anyone else simply by virtue of having computers that are physically closer to a stock exchange than their competitors. An HFT algorithm can then execute its own order already knowing the direction the price of the stock is likely to go. But even though this isn’t the biggest problem with HFT, I do think Salmon is a little too dismissive of it. Here he is on the subject of Rich Gates, a mutual fund manager who discovered he was being front run

Gates “devised a test,” writes Lewis, to see whether he was “getting ripped off by some unseen predator.”….Gates “was dutifully shocked” when he discovered the results of his test: He ended up buying the stock at $100.05, selling it at $100.01, and losing 4 cents per share. “This,” he thought, “obviously is not right.”

Lewis does have a point here: It’s not right….In Gates’ mind, what he saw was the 35,000 customers of his mutual fund being “exposed to predation” in the stock market. Between them, those customers had lost $40: 4 cents per share, times 1,000 shares. Which means they had lost roughly a tenth of a cent apiece, buying and selling $100,000 of Chipotle Mexican Grill within the space of a few seconds.

But there’s always going to be a nonzero “round-trip cost” to buying $100,000 of a stock and then selling it a few seconds later….But still, $40 for two $100,000 trades is hardly a rip-off. Especially when you consider the money that Gates himself is charging his 35,000 mom-and-pop customers.

When Gates was running his experiments, his flagship fund, the TFS Market Neutral Fund, had an expense ratio of 2.41 percent: For every, say, $100,000 you had invested in the fund, you would pay Gates and his colleagues a fee of $2,410 per year. That helps puts the tenth of a cent you might lose on Gates’ Chipotle test into a certain amount of perspective. TFS trades frequently, but even so, any profits that HFT algos might be making off its trades are surely a tiny fraction of the fees that TFS charges its own investors.

MORE: Is High-Speed Trading the Next Wall Street Disaster?

That’s true. But the whole point of HFT has always been to skim tiny percentages from a large number of trades. Nobody has ever suggested that individual traders are losing huge amounts of money to HFT shops. Nevertheless, that’s no reason to downplay it. In fact, that’s one of the things that makes HFT so insidious: it’s yet another way for Wall Street players to game the system in a way that’s so subtle it’s hardly noticeable. This is the kind of thing that permeates Wall Street, and I think Lewis is correct to aim a spotlight at it.

There are plenty of reasons to be very, very wary of HFT. I wish Lewis had at least spent a few pages on the potential instability issues, but let’s face facts. Front running is a perfectly legitimate problem to focus on, and it’s likely to generate a lot more public outrage than a dense abstract about the possibility of robots causing a financial crash sometime in the dim future. So if you’re the rare person who can attract a lot of attention to a legitimate financial danger, it makes sense to write a book that concentrates its fire on the most accessible aspect of that danger. That’s what Lewis chose to do, and I don’t really have a problem with that.

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In Defense of "Flash Boys"

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Russia Demands Lease Refund After Invading Crimea

Mother Jones

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Russia is threatening to nearly double the price of natural gas that it sells to Ukraine:

Russia’s natural gas monopoly Gazprom’s Chief Executive Alexei Miller said Saturday in a televised interview the company has raised the cost of gas to Ukraine to $485.50 from $268.50 for 1,000 cubic meters from April 1. Moscow says the price change is due to Kiev’s failure to pay its bills.

….Mr. Miller said Ukraine owes Gazprom $2.2 billion for March deliveries, and another $11.4 billion the country saved as part of a discount agreement that Moscow recently scrapped….Mr. Miller the discount was a prepayment for the Russian Navy’s use of Ukraine’s Black Sea port of Sevastopol through 2017, but as that port had been annexed by Moscow, along with the rest of Crimea, Ukraine should repay $11.4 billion it saved, Mr. Miller said, following similar statements by Russian Prime Minister Dmitry Medvedev.

So Russia gave Ukraine $11.4 billion as a payment for its lease of naval facilities in Crimea through 2017. But now that they’ve invaded and conquered Crimea, they figure they deserve a refund. The mind boggles.

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Russia Demands Lease Refund After Invading Crimea

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Europe wimps out again on airlines’ carbon pollution

Europe wimps out again on airlines’ carbon pollution

Shutterstock / Lukas Rebec

European efforts to force international airlines to pay for their carbon pollution will stay parked on the runway for at least several more years.

Airlines are covered by the European Union’s Emissions Trading System. Airfares for flights within Europe have included a carbon fee under that system since the beginning of 2012. The plan has been to expand the program to include international flights that begin or end in Europe, but that proposal has been vigorously opposed by China, the U.S., and other countries. China had put a large order for aircraft from Europe-based Airbus on hold over the dispute.

On Thursday, amid promises that the climate-unfriendly airline industry will soon launch its own climate program, the U.S. and China prevailed, again, clinching a years-long delay. Members of the European Parliament voted 458 to 120 to exempt flights in and out of Europe from the emissions trading program until early 2017. A bid to delay the program until 2020 was rejected by the lawmakers.

“We have the next International Civil Aviation Organization assembly in 2016,” parliamentarian Peter Liese said. “If it fails to deliver a global [climate] agreement, then nobody could justify our maintaining such an exemption.” But so far the aviation industry’s efforts to develop its own climate plan have been feeble.

“The [European] Commission would of course have preferred and fought for a higher level of ambition,” E.U. Climate Commissioner
Connie Hedegaard said
. “It would’ve been better for Europe’s self-respect and reputation and even more important, for the climate. But we are where we are.”


Source
EU drops plan to extend CO2 rules to international flights, Reuters
EU Lawmakers Limit Carbon Charge on Airlines, The Wall Street Journal
EU backs compromise on plane CO2 emissions, BBC

John Upton is a science fan and green news boffin who tweets, posts articles to Facebook, and blogs about ecology. He welcomes reader questions, tips, and incoherent rants: johnupton@gmail.com.

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Europe wimps out again on airlines’ carbon pollution

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