Category: In the News (Page 3 of 3)

2005-02-14 00:19 (New York)

(Commentary. Gene Sperling, who was President Bill Clinton’s top economic adviser, is a columnist for Bloomberg News and a senior fellow at the Center for American Progress. The opinions expressed are his own.)

By Gene Sperling
Feb. 14 (Bloomberg) — Imagine the following: The father of a financially stretched family decides to live it up by leasing three fully loaded Hummer H1s for the bargain price of $9,750 a month.
As the family’s financial situation deteriorates, the father calls the family together for a belt-tightening discussion. He holds up a jar of Whole Foods chunky peanut butter and says, “Do you realize we are spending $4.49 on this? We could be saving $2.04 if we bought Skippy peanut butter for only $2.45.”
His teenage son responds, “Like, dad, man, why are you busting us about two bucks on peanut butter when you’re spending, like, almost $10,000 a month on cars?” The father sternly responds, “Don’t change the subject. We are talking about peanut
butter.”
On Feb. 7, President George W. Bush sought to use his 2006 budget to emerge as a born-again fiscal belt tightener. His goal was clear: Focus the fiscal debate on cutting programs for hardworking families and the poor — which are the financial
equivalent of peanut butter — while ruling out any effort to add up, put on the table or even acknowledge the budgetary equivalent of luxury Hummers — his tax cuts for the highest-income Americans.

The Cuts

Like the son in the family fable, most Americans understand the basic law that money is always fungible — a dollar on cars could also be a dollar spent on peanut butter. Yet Bush’s entire budgetary case rests on the assumption that no one will notice or change the subject to mention that his proposed spending cuts are dwarfed by the deficit-exploding tax reductions that he is seeking for high-income Americans.
Consider some of the cuts Bush is claiming are necessary to get tough on the deficit:
First, he would cut $500 million for job training and dislocated workers in the midst of what is still the slowest jobs recovery since the 1930s.
Second, he would virtually eliminate the $500 million Community Oriented Policing Services program when we are concerned about domestic terrorist threats.
Third, Bush would impose $4.5 billion in net cuts to Medicaid for the poor and disabled when health-care costs and the number of uninsured are rising.
And fourth, he would scrap the $1 billion a year in funding for the GEAR-UP and TRIO programs that reach out to economically disadvantaged children early and encourage them to go to college when our economy desperately needs a larger share of this population to obtain college degrees.

The Exemptions

Yet while these cuts add up to only about $6.5 billion a year, no one is supposed to mention that in the same budget Bush calls for implementing two obscure tax provisions that increase personal exemptions and itemized deductions that the top 2 percent of Americans can use to reduce their tax payments to the tune of $115
billion over the next decade.
That’s enough to prevent all these cuts and still reduce the deficit by $55 billion. Nor can we mention that if we pulled back on the income-tax cut (leaving alone capital gains and dividends) for the 0.5 percent of Americans making more than $400,000 a year, we could save $300 billion over the next decade — enough to buy a
lot of peanut butter and still make a big dent in the deficit.
Anyone who took seriously Bush’s commitment to deficit reduction might assume that his tight cap on domestic programs was motivated by the deficit exploding because such spending had gotten out of control.

One-Sided Reality

Yet, in an analysis conducted at the Washington-based Center for American Progress, it was found that when you exclude expenditure on defense, homeland security and international affairs, discretionary spending has actually decreased from 3.4 percent of gross domestic product in 2001 to 3.3 percent in 2005.
On the other hand, the decision to pass and extend three tax cuts and an expensive prescription drug benefit without any offsets is set to increase the deficit by more than $5 trillion over the next decade, including interest costs.
Even when looking at our long-term capacity to deal with the challenge of the baby boomers’ retirement, Bush is trying to construct this same one-sided budgetary reality.
While the Social Security Trust Fund is solvent, the president laments that in 2018 the government as a whole will have to “somehow” borrow an additional $200 billion to meet its legal Social Security commitments. Yet he seems oblivious to the fact that his own tax and spending policies will increase government borrowing that year by more than $500 billion.

Eat the Generic

Bush wants members of Congress to go home and tell their constituents that there is simply no choice but to achieve Social Security solvency entirely through benefit cuts with new price- indexing rules. Yet he disallows any discussion of the fact that making permanent his tax cuts for only the top 1 percent of earners
— as his budget calls for — costs almost as much as is needed to keep Social Security solvent for 75 years.
Still, I get it, Mr. President, I’m changing the subject. This budget isn’t about finding numbers that lead to deficit reduction, it’s about using the pretext of deficits to limit government’s role to help those most in need. Perhaps you think the father was right to forbid any discussion of luxury Hummers. Let them eat Costco
generic peanut butter.

First, let’s consider what actual P2P losses are to the industry.

They are much more difficult to calculate than the RIAA would have you believe. Why? First, downloaders pull songs they would never buy; I have Outkast’s “Hey Ya” somewhere; I consider it a goofy novelty song, and the only reason I have it is that someone else sync’ed it to a Peanuts animation (everyone on stage dancing to Schroder’s piano). It was an amusing but unauthorized use, which I downloaded, smiled at, and never saw again.

Oh ya: The CD that song came from — OutKast’s 2003’s release, Speakerboxxx/The Love Below — sold 10-million plus copies.

Lost sales? Hardly.

Consider the biggest of all downloaders — mostly-broke college students. They have a computer their parents bought them, and the campus gives them a big, fat pipe. They get access to music they would never have bought, resulting in future post-college sales. But the one-to-one lost sales argument is transparently false.

Next, let’s consider what the damages to the industry are. Consider the issues of substitution: What would it cost to purchase an “unlimited amount” of digitally distributed music? The answer is found in the Napster-to-Go model:

“The Napster to Go model . . . shows that the RIAAs claims of a lost sale for every download to be demonstrably false. If you can download an unlimited number of songs via napster and play them for as long as you continue to subscribe, then the maximum loss the RIAA suffers from a single downloader cannot exceed $15/month no matter how many songs a person downloads.” — via boingboing

Over the course of 10 years, that represents total gross losses of $1,800, of which Napster keeps between 15 and 20%. Net loss: $1,500 dollars.

But wait, there’s more: The Rhapsody Music Subscription from Real Networks charges only $10 per month. That’s $120 per year. Over a decade, the net loss downloaders present to the industry by not signing up for Rhapsody are: lost revenue of $1,200 (gross). In other words, the total net industry losses are ~$1,000 per decade. Hardly as apocalyptic as portrayed.

By approving the Napster/Rhapsody subscription models, the music industry has unwittingly created a viable legal defense, at least when it comes to damages portion of their litigation, for defendants in a RIAA P2P litigation. The claims of losses in the $100,000 or even $10,000 are silly — as long as this $1,000 net loss per decade option exists.

Of course, that doesn’t consider studies (such as the one from Harvard/UNC CHapel Hill) that shows P2P drives CD and concert ticket sales. I only buy music that I hear and like. Since that hardly happens via the radio anymore, P2P is my most common source of new music (that, and Apple adverts).

Further, the industry’s disingenous claims that its the artists are getting ripped off by downloaders are rather misleading. (Putting aside the industry’s own long and storied history of ripping off their artists for another day).

A recent NYT article reveals that most musicians make their bread and butter not by selling CDs, but by touring and performing:

“According to a new list of the 50 top-earning pop stars published in Rolling Stone, over the hill is the new golden pasture. Half the top 10 headliners are older than 50, and two are over 60. Only one act, Linkin Park, has members under 30.

The annual list, which entails some guesswork, reverses the common perception of pop music. Not only is it not the province of youth; it’s also not the province of CD sales, hit songs and smutty videos.

While sexy young stars take their turn strutting on the Billboard charts or MTV – or on the cover of Rolling Stone – the real pop pantheon, it seems, is an older group, no longer producing new hits, but re-enacting songs that are older than many of today’s pop idols.”

This has serious financial repurcussions for the business model the industry is presently wed to. And the list of artists who are making the big bucks reveals industry mismanagement has led to mostly ignoring the key economic demographic driver of our century: The baby boomers.

Here’s a little secret the RIAA would rather not have you know: Musicians make most of their money performing and touring — not selling CDs or downloads. Rolling Stone has a detailed analysis of the top 50 acts . . . here’s a top 10 list to whet your appetite:

2004 Music Money Makers
1. Prince $56.5 MILLION
2. Madonna $54.9 MILLION
3. Metallica $43.1 MILLION
4. Elton John $42.9 MILLION
5. Jimmy Buffett $36.5 MILLION
6. Rod Stewart $34.6 MILLION
7. Shania Twain $33.2 MILLION
8. Phil Collins $33.2 MILLION
9. Linkin Park $33.1 MILLION
10. Simon and Garfunkel $31.3 MILLION

Note that 9 of the top 10 grossing performers aren’t the hot new thing — they are the better known rock classics — which the labels have mostly also been paying little attention to for so many years.

The industry can scapegoat P2P for all their woes, but a closer analysis of the math demonstrates the claim is illusory. (Mis)management is the primary sources of the industry problems.

Read it and weep, folks. In the Order, every single geek argument is
slammed, and slammed *hard*. In particular:

“This Court finds, as did both the Corley and Elcom courts, that legal
downstream use of the copyrighted material by customers is not a defense
to the software manufacturer’s violation of the provisions of – 1201 (b)(1).”

Fair Use is no defense to the DMCA tools provision, sayeth that Court.

Electronic Frontier Foundation Urges Digital Copyright Law Reform
http://www.eff.org/IP/DMCA/MGM_v_321Studios/20040220_eff_pr.php

San Francisco – Consumers suffered a setback to their digital rights
today when a California federal court sided with the major motion
picture studios in ruling that a company creating tools people can use
to make backup copies of their DVDs is liable under copyright
law. Citing the Digital Millennium Copyright Act (DMCA), the court
ordered 321 Studios, creator of DVD backup tools, to stop selling its
DVD Copy Plus and DVD-X COPY products within seven days. 321 Studios
is likely to appeal the ruling.

[Source material at:
http://www.eff.org/IP/DMCA/MGM_v_321Studios/
http://www.eff.org/IP/DMCA/MGM_v_321Studios/20040219_Order.pdf]

Italian police seek huge breasted woman
Ananova
http://www.ananova.com/news/story/sm_866580.html

Italian police are looking for a woman with huge breasts who has gone on the run after failing to pay for £5,000 implants.

The 46-year-old woman, who has been identified only by her initials AM, slipped out of her hospital bed following the surgery and disappeared.

Doctors at the clinic in Rome say that apart from the unpaid bill they are also concerned for her health as she requires close monitoring following the surgery.

Dr Jamal Salhi said: “She told me that she needed the surgery because she worked in a hostess bar and that clients preferred big chested women.

“She went from a size four to a size eight which is the largest you can get in Italy. When she came to my surgery she said: “I want the biggest chest possible.”

“‘It has since emerged that she gave false information when she arrived at the clinic and apart from running off without paying, as with any surgery she needs to be monitored afterwards.”

Dr Salhi then revealed it was not the first time he had been the victim of a fraudster. He said: “This has happened to me several times before, the most recent was last December.

“A man paid for a penis enlargement and disappeared without paying. We still have to be paid for that operation.”

Police spokesman Adriano Lauro said: “We have issued a warrant for the woman’s arrest and also one for her husband following the complaint from the clinic.”

Story filed: 10:33 Monday 16th February 2004

Check out this story… I pity the people who live in rural areas at the best of times. Now they are being the victims of silly regulations and policies.

Cross-Border Church Visit Costs U.S. Man $10,000
Mon Feb 9, 5:23 PM ET

By Charles Grandmont

MONTREAL (Reuters) – Crossing the U.S.-Canada border to go to church on a Sunday cost a U.S. citizen $10,000 for breaching Washington’s tough new security rules.

The expensive trip to church was a surprise for Richard Albert, a resident of rural Maine who lives so close to the Canadian border the U.S. customs office is right next door to his house.

Like the other half-dozen residents of Township 15 Range 15, crossing the border is a daily ritual for Albert. The nearby Quebec village of St. Pamphile is where they shop, eat and pray.

There are many such situations in rural areas along the largely unguarded 8,900-km (5,530-mile) border between Canada and the United States — which in some cases actually runs down the middle of streets or through buildings.

As a result, Albert says did not expect any problems three weeks ago when he returned home to the United States after attending mass in Canada, as usual.

The local U.S. customs station is closed on Sundays, so he just drove around the locked gate, as he had done every weekend since the gate appeared last May, following a tightening of border security.

Two days later, Albert was summoned to the customs office, where an officer told him he had been caught on camera crossing the border illegally.

“It didn’t deny it, I’ve always done that,” said the 52 year-old Maine native.

Ottawa has granted special passes to some 300 U.S. citizens in that region so they can enter the country when Canadian customs posts are closed, but the United States canceled a similar program last May.

That forces local residents to make a 320-kilometer (200-mile) detour along treacherous logging roads to get home via the nearest staffed border checkpoint.

A spokeswoman for the U.S. Bureau of Customs and Border Protection would not comment specifically on Albert’s case because of privacy laws.

“Since 9/11, we’ve enhanced our security and, yes, some of the situations require inconvenience to people, so we have to go along with what the regulations are,” said Janet Rapaport, a public affairs officer with the bureau. She added that local residents had been told about the stricter controls.

Albert has appealed the fine, but he has not attended a Sunday mass since.

“I feel like I’m living in a jail,” he said.

ARKANSAS CITY (EAP) — A Little Rock woman was killed yesterday after leaping through her moving car’s sun roof during an incident best described as “a mistaken rapture” by dozens of eye witnesses.

Thirteen other people were injured after a twenty-car pile up resulted from people trying to avoid hitting the woman who was apparently convinced that the rapture was occurring when she saw twelve people floating up into the air, and then passed a man on the side of the road who she claimed was Jesus.

“She started screaming, ‘He’s back, He’s back,’ and climbed right out of the sunroof and jumped off the roof of the car,” said Everet Williams, husband of 28-year-old Georgann Williams, who was pronounced dead at the
scene.

“I was slowing down but she wouldn’t wait till I stopped,” Williams said. “She thought the rapture was happening and was convinced that Jesus was gonna lift her up into the sky,” he went on to say.

“This is the strangest thing I’ve seen since I’ve been on the force,” said Paul Madison, first officer on the scene.

Madison questioned the man who looked like Jesus and discovered that he was dressed up as Jesus and was on his way to a toga costume party when the tarp covering the bed of his pickup truck came loose and released twelve blow-up sex dolls filled with helium which floated up into the air.

Ernie Jenkins, 32, of Fort Smith, who’s been told by several of his friends that he looks like Jesus, pulled over and lifted his arms into the air in frustration, and said, “Come back here,” just as the Williams’ car passed him, and Mrs. Williams was sure that it was Jesus lifting people up into the sky as they passed by him, according to her husband, who says his wife loved Jesus more than anything else.

When asked for comments about the twelve sex dolls, Jenkins replied, “This is all just too weird for me. I never expected anything like this to happen.”