OK, so I'm debating the recall Tues nite on TV

[Capn Sunshine]

How do I communicate the message that you'd have to be really stupid to vote YES if you examine the facts without alienating the audience?
The dirty secret to this is if the recall PASSES, no matter who wins, the state will pay BILLIONS more in additional interest and service charges to Wall Street underwriters.

Is this just too arcane for the general public to comprehend?

I have this quote from the Lead S&P analyst on the rating of Calidfornia's bond issues:

"Changing governors at the snap of a finger doesn't portend stability."Using THIS as a rationale for lowering the state's bond rating to junk status.

Think about it: The 5th largest economy in the world, paying junk-status interest rates for state financing, like we're a third world banana republic. Grover Norquist's goal of disabling government through indebtedness seems well underway.

How do I shrink this concept to a managable size?
Any creative suggestions DUers? I know you have them. :)

BTW as AFAIK the show is limited to Adelphia subscribers so far. I only WISH we could get statewide coverage.

[saline]

1. how about this...

I don't understand what you're saying, so explain it. Maybe this way we can establish what needs to be said to a potentially uninformed audience. Following that we can sharpen it into a sharpened stick of political pointyness.

My questions are these:

I don't understand why lowering the states bond rating to junk status is bad. I see how "junk status" certainly seems bad, no one likes junk but I don't understand what it means or portends for California's future.

Why is the state paying Wall Street underwriters? Who signed what contract for what purpose? How did you get the amount of billions (let alone BILLIONS)?

Also make sure to let them know where they can get the facts (here perhaps) plug your sources.

Good luck!

[AP]

3. Debt to leverage growth is good. Debt to maintain the minimum

social safet net is the only option.

So the state has to issue bonds.

Now, there are only two bond rating agencies in America (maybe three) and they're private companies. They have no responsibility except to their own reputations (and their shareholders).

When they lower the bond rating, that means that you have to pay higher interest rates on your bonds. Money which could go to doing good for your state goes to profit for the investors who buy your bonds.

In The Hunting of The President, Conason and Lyons suggest taht Clinton first got on the right wing radar because he broke the Stephens, Inc (Wesley Clark's temporary employer after he retired from the military) monopoly on issuing bonds for Arkansas projects. Because Stephens, Inc had a monopoly on issuing bonds, they could charge the state whatever fees they deemed appropriate. Clinton looked at all the state taxpayer money that was going into the pockets of Stephens, Inc's owners, and said this money would be better spent on public investment. He created a state-run bond issuing company which ended up saving the state millions (and maybe billions) of dollars.

Folks, this is what the right wing hates more than anything. No, it's not abortion, phillandering or agnosticism. It's the flow of wealth to the people rather than into the hands of a small group of republicans that the right wing wants to prevent. And because Clinton "got it" as people like to say here (except that Clinton really got it -- he understood that wealth in the hands of the masses is the surest bulwark against fascism) we went through all this anti-democratic shit we go through even until today.

[Capn Sunshine]

4. This is what I fear

No one understands state finance and the role bonds play. BONDS are how we get the cash to operate. The "Status" or rating given a bond, determines the PRICE you get for the bond in the open market. The PRICE is what you NET.The rating determines how much you net ; as bonds sell at a discount to the face value. The BOND is an instrument that is a contract to pay a set % for a specific period of time. This is "borrowing" money much like what you do with a credit card. AHA! This will probably be my analogy.Thanks!

IF your credit is good, the COST of charging is lower than if your credit is bad. You pay 5% with good credit. For every $100 you borrow, you pay $5 interest.
Imagine if your personal credit rating was "junk" you'd have to pay 19.8% for the same money, or $19.80 per hundred.
I bet you could use that difference of $14.80 to benefit YOU. Instead it goes bye bye to the bank, instaed of staying inYOUR account.

The difference in these instruments , just between a "bad" rating and "Junk status " amounts to BILLIONS of extra dollars interest that leave the state. Three Billion just on our latest issue.

Wall Street underwriters are the guys that "do" this business.This is a result of the evolution of our financial system. It's the Banks you choose to do the deal: in this case , we have chosen Chase Manhattan. They are bigger and have the best ability to sell these bonds.

By the way, the bond market is intentionlly designed to be arcane and misleading; many stockbrokers confess to not understanding it.
Is that any clearer?

[AP]

5. You have to explain this, and then explain how the strategy the

right always uses against liberals who aren't down with the idea of shifting social wealth to Wall St pockets is to cause economic havoc, and then claim that they're the ones who are going to clean it up.

They hope that there's too much math and economics involved to understand how they caused it. (Don't look at the man behind the curtain.)

[saline]

6. Good, we've got an anlogy

Thats about 70% of what you need. As a high school debator we ran analogy drills to explain our arguments to the judges, it helped immensly. Lets stick with the credit card analogy, stress that your credit rating is like a states bond rating and has the same effect on each one's ability to borrow money and repay those loans.

Specify how much money to within a million dollars is at stake, mention the states current bond rating and the percent that amounts to and what it will be if the recall passes. Always remember to qualify your statements and never present conjecture or approximations as fact.

Make conservative estimates and stress that the estimates are conservative (in the sense of being under-estimates), people will draw their own conclusions far exceeding what you would have said without under-estimating.

The "Three billion on just our latest issue." is an excellent point and example of the last few points I mentioned.

One thing I might do is leave out references that might create the image of evil conspirators in NY finance, makes you look like a kook even if it is true. Avoid the BTW diversions stick to your subject and drive it home.

Again, GOOD LUCK!

[AP]

2. I would spend today and tomorrow reading The Pinochet File

and working out an argument to connect what the US was doing in Chile on 9/11/73 to what's happening in places like Florida and California today.

I heard the author of this book talk about why the US had to undermine Chile, and how they undermined Chile.

They had to undermine Chile because the socialist government was going to spread wealth among the middle class, and because he was going to demband that the profit from the exploitation of Chilean resources flows back into Chile. So, the US tried to undermine the election. When that didn't work, they tried to bring Chile to its knees economically, hoping the citizens would see this as a sign that the socialists didn't know how to run the economy, and that they'd beg to have a right winger come in and straighten in out (sound familiar?). When that didn't work and the inauguration went on, the decided they'd kill Allende.

Well, 30 years ago, the right wing overturned democratically elected socialist governments. Today, perhaps emboldened by their successes, they now overthrow Democratically elected MODERATE liberal governments. But the motivation is the same, and the techniques are the same. They want to make sure that the wealth created in California by the middle class flows up the income ladder to big businesses (like Enron) and wealth individuals. They don't like governments which want to progressively tax its citizens, and which want allow them to have a little more economic power (and therefor political power). And the first thing they do is try to create economic turmoil (energy crisis, lowering the bond rating) and then they pretend that the button-down republicans are going to swoop in and impose their organizational skills to fix the 'mess' (without ever explaining that they deliberately created the chaos in the first place).

This is what impeaching Clinton was all about, this is what the Florida velvet coup was all about. This is why Republicans don't like moderate liberals like Hugo Chavez, Gerhard Schroeder and Tony Blair abroad. This is why they're trying to undo a democratic election in California. At some point the citizenry have to stand up and say, 'have you no sense of democracy? At long last, have you no sense of democracy?'

[Capn Sunshine]

7. My first celebrated political journalism

was a college masters thesis paper eschewing all books and using periodicals and first person testimony on the Chilean overthrow of Allende. Not using books was considered VERY edgy and required all sorts of clearances from the university; it became a teaching text for a Poli Sci 200 class on Latin America.Made a national stir back in 72 in academia. This was before the internet so the idae of rounding up all this info was somewhat new at the time.

So , yeah, I'm in tune with the whole shebang. The transfer of wealth to anyone otherthan multi national corporations has always been a touchy issue with teh Bushistas. Remember Popy was working with CIA via various companies at this time; although his primary expertise seemed to be the Caribbean.

This is a good tack to take.

[Clete]

12. The reason they wanted Allende out of Chile is

that he nationalized the American mining interests there. My father worked for Anaconda, although he retired before this happened. It was stupid because the nationalization would have happened anyway, whether it was Allende or not. Pinochet never returned the mines either.

[AP]

14. According to the author of the Pinochet File it was more than that.

And it was done so violently because it was meant to be a lesson to other socialist parties. It was a message to not even bother trying to run a country in way that ploughs profits back into your citizens.

[LWolf]

8. What channel?

Can we watch?

[sandnsea]

9. $8 billion next year

I've seen it reported a couple of times that the deficit will be down to $8 billion next year. How did this get done? How is the increased interest going to affect that?

Texas has the 2nd highest deficit in the country, you don't even hear about it. No, they're trying to get more Republicans in control of Texas.

Being reduced to junk bond status is like when you miss a payment on your low-interest credit card. You are an increased risk and your interest rates go up. Keep it simple.

Just some thoughts that might work, or not.

[w4rma]

10. "Use blackouts to break Davis, and use Davis to break the Democrats."

The California Recall Plot by Michelle Mairesse
…
They gamed the system so successfully in California that they soon were raking in fortunes and flicking the lights on and off all over the state. After the third rolling blackout had occurred in California, Lay called a secret meeting of high Republican honchos at the Beverly Hills Hotel. He invited such notable Republicans as then-mayor of Los Angeles Richard Riordan, convicted junk-bond scammer Michael Milken, and steroid-enhanced movie star Arnold Schwarzenegger.
…
Not everyone was unhappy about the rolling blackouts. California Republicans gleefully announced their strategy on the Internet, with such conservatively compassionate messages as: "Use blackouts to break Davis, and use Davis to break the Democrats."

The strategy seemed to be working. The Federal Energy Regulatory Commission declined to intervene, although ratepayers in San Diego County eventually saw their energy bills increase by 300%. In pursuit of petty, partisan politics, the Bush administration allowed corporate outlaws to inflict grievous harm on the citizens and businesses of California. With electricity selling for $1500 per megawatt hour, Silicon Valley workshops, hospitals, and schools went dark; the poor dispensed with gas and electricity, and small businesses closed their doors. Belatedly, the FERC capped prices at $273 per megawatt hour.
…
An August 17 Los Angeles Times editorial maintains that the state of the state is not nearly as grim as the doomsayers claim. California has no more unemployed workers than has the rest of the country, and unemployment is greatest in Silicon Valley, where the high-tech bubble burst and created much of the budget deficit. The number of businesses actually increased during the energy crisis in 2000, the latest year for which statistics are available. Another Schwarzenegger advisor, Democratic billionaire Warren Buffett, in a pronouncement that was not much bruited abroad, said, "California has a vibrant economy."

According to Paul Krugman, news reports continue to talk about a $38 billion deficit, although next year's (2004) projected gap is only $8 billion.
…
http://www.hermes-press.com/recall2.htm

Transcript: Presidential Candidate Howard Dean Tells California Voters To Vote No On Recall
http://www.cnn.com/TRANSCRIPTS/0309/06/se.04.html

Dean stumps for Davis in California
http://www.cnn.com/2003/ALLPOLITICS/09/06/dean.davis/

State of Decline by Paul Krugman
http://www.truthout.org/docs_03/080203C.shtml

Conan the Deceiver by Paul Krugman
http://www.truthout.org/docs_03/082303F.shtml

Californians May Pay Recall Election Tab For Years

SAN FRANCISCO -- The cost to hold the upcoming recall election is estimated to be about $30 million. But some predict the final price tag will be higher.

NBC11's Jodi Hernandez talked to the state's top financial officer about how much the election may cost taxpayers. Hernandez said some are now putting the price at close to $1 billion for the recall election that will take place in just a few months. But Californians could be paying the tab for years to come.

As counties prepare for an unprecedented recall election, the price tag for holding it keeps growing. Last week, officials put the bill at nearly $60 million. But now the state controller warns the election could add up to much more than that.

"We will all pay the price to the tune of hundreds of millions of dollars in addition to the $35 million cost of a new election," State Controller Steve Westly said.
…
Counties will bear the brunt of expense of holding the special election. The state will be responsible for paying the costs associated with the change in the bond rating. This week alone, the state will pay some $34 million in penalties, Hernandez reported.
http://www.tribnet.com/opinion/columnists/george_will/story/3665696p-3696385c.html

[AP]

11. Just to get a sense of what the pot of gold is that Republicans covet,

a few things to consider:

- Entertainment is the largest export industry in America. Even if America is fucked up internally, a lot of entertainment companies are going to make a ton of money selling their stuff in Europe, and, anyway, movies are a recession-proof industry. If you can't afford a vacation, you go to the movies. All those entertainment companies are HQ's in LA. And compare today to ten years ago. Every large film distributor is now part of a conglomerate which owns a network, news outlets, publishers, etc. These are huge companies which are interested in a sort of regressivity in the tax code and income shift upwards which is totally at odds with middle and working class interests.

- The defense industry is CA's second largest industry, after entertainment. If you need to know what kind of political climate the defense industry needs to make a proft, then you haven't seen Bowling for Cloumbine. Psst, 9/11.

- Californa is the 8th largest economy in the world. That's a lot of people making a lot of money, toiling away, trying to keep their heads above water, whom the banks would like to keep in debt, whom the energy companies would like to monopoly price as much as possible, and whom the super rich big businesses and individuals would like to have pull the entire weight of the income tax burden so that they can have super low property taxes on their mansions.

[neuvocat]

13. You could mention the public wasn't entirely informed on the recall.

Most states have the same fiscal problems as CA and link the energy debacle to the Bush admin. Davis also pointed out that FERC was supposed to by law investigate the problem and never did. The reasons for removing Davis are actually the fault of Bush.

[Yupster]

15. Is anyone working to get the recall law repealed?

Regardless of how this recall comes out?

Just my advice, but if discussing the recall to real average voters, I'd probabaly leave Allende and Pinochet out of it.