News digest / Catching up on news (08.08.2014)

Lately I can't keep up with my re-posting duties. Quickly, here are several stories you might have missed:

Federal Judge Rules Some College Players Are Entitled To Payment:  http://n.pr/V95KJ7 -- SOME JUSTICE!

How Big Is a $16 Billion Bank Fraud Settlement, Really?:  http://huff.to/1A036VM  -- NOT VERY.

FEAR: 11 TOP BANKS STILL TOO BIG TO FAIL:  http://huff.to/1zS8ZnU  -- TBTF HERE TO STAY, BY DESIGN.

Nine myths about the social safety net, annotated:  http://wapo.st/1pF1Cvr  -- OLD PEOPLE ARE THE BIGGEST WELFARE QUEENS?

Unwealthy in America: New study finds that Top 1 percent hold 37 percent of nation’s wealth. A quarter of US families feel they are under economic stress caused by the Great Recession:  http://www.mybudget360.com/unwealthy-in-america-wealth-in-united-states/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+mybudget360%2FQePx+%28My+Budget+360%29  

The Conflict In Gaza Explained In One Map:  http://huff.to/1ASuhTK  -- UNLESS IT'S A MAP DERIVED FROM THE OLD TESTAMENT, I'M NOT INTERESTED.

Your chicken is about to get more full of feces:  http://gu.com/p/4v9ex  -- YUM!

Private charity fails to replace social programs

As I've noted before, charitable giving is "pro-cyclical," meaning it decreases during a bad economy when it's needed most.  

Hiltzik also points out that very little of charitable giving is aimed at the needs of the poor; and the rich are more miserly givers than the rest of us:

The smallest allocation of philanthropic giving to basic needs of the poor was made by the wealthiest donors, those with income of $1 million of more, who directed 3.8% of their giving directly to the poor. For the $100,000-$200,000 income group, that allocation was 12.4%.

"The existing evidence doesn't support the idea that wealthy donors will step in" to replace government transfer programs, says Rob Reich, an expert in philanthropy at Stanford. As he wrote last year, "Philanthropy appears to be more about the pursuit of one's own projects, a mechanism for the expression of one's values or preferences rather than a mechanism for redistribution or relief for the poor."

The largest single recipient of philanthropy is religion — 32% of the total, according to Giving USA. But only a small portion of that goes to outreach to the needy; more than three-quarters of donations to religious organizations is spent on "congregational operations," including facilities upkeep.

So here's the upshot:

What all this shows is that there's an unspoken subtext when people like [Representative Paul] Ryan complain, as he did during the 2012 presidential campaign, about "cold social programs from the federal Department of Health and Human Services" built by a government that "took away much of our greatness."

Ryan is evoking a golden-hued fairy tale of a past that never existed. In the real world today, those "cold social programs" from HHS and other federal agencies keep people fed and housed, and alive, and give their children opportunity.

Private charity can't replace government social programs

By Michael Hiltzik

March 30, 2014 | Los Angeles Times

URL: http://www.latimes.com/business/la-fi-hiltzik-20140330,0,1556558.column#ixzz2xRw4lXl7

Charity never did, never can, replace safety net

I've argued most of this before, (you can read some here, here and here), but Mr. Konczal lays out the exhaustive historical case that the U.S. never did manage to take care of its poor through private charity.

Contrary to what Paul Ryan, Newt Gingrich, Rand Paul, et al tell us, there never was a golden era in American history when private people and charities provided a safety net, or even anything close to one.

So the burden really is on far-right conservatives who want to tear down the safety net that was built to fix all these historical problems, to explain how they are going to invent something totally novel to American history, and guarantee that it will work when such patchworks or networks of charity have always failed in the past.

There's just no valid study, history or facts to back up their false claim.

The Conservative Myth of a Social Safety Net Built on Charity

By Mike Konczlar

March 24, 2014 | The Atlantic

URL: http://www.theatlantic.com/politics/archive/2014/03/the-conservative-myth-of-a-social-safety-net-built-on-charity/284552/

Safety net reduces poverty - now more than ever

LBJ and every Democrat since then was right: the safety net works. We have reduced poverty.

The facts show that we are right and the critics are wrong. Liberals should never apologize for policies that have saved millions of lives. 

We liberals should be proud! 

Study: U.S. poverty rate decreased over past half-century thanks to safety-net programs

By Zachary A. Goldfarb

December 10, 2013 | Washington Post

URL: http://wapo.st/IMOJhu

Survey: U.S. workers suffer unprecedented anxiety

And it's all because of Obamacare and federal regulations.... Oh, and too-high taxes on corporations, can't forget that one.

Seriously though, Republicans are out of answers and Democrats are too pussy to do what's necessary, like expanding unemployment benefits, raising the minimum wage, expanding Social Security, offering real child care, etc.:

More than six in 10 workers in a recent Washington Post-Miller Center poll worry that they will lose their jobs to the economy, surpassing concerns in more than a dozen surveys dating to the 1970s. Nearly one in three, 32 percent, say they worry “a lot” about losing their jobs, also a record high, according to the joint survey, which explores Americans’ changing definition of success and their confidence in the country’s future. 

And this worry is especially strong among the working poor, aka the Little Guys:

Fifty-four percent of workers making $35,000 or less now worry “a lot” about losing their jobs, compared with 37 percent of ­lower-income workers in 1992 and an identical number in 1975, according to surveys by Time magazine, CNN and Yankelovich, a market research firm. Intense worry is far lower, 29 percent, among workers with incomes between $35,000 and $75,000, and it drops to 17 percent among those with incomes above that level.

Lower-paid workers also worry far more about making ends meet. Fully 85 percent of them fear that their families’ income will not be enough to meet expenses, up 25 points from a 1971 survey asking an identical question. Thirty-two percent say they worry all the time about meeting expenses, a number that has almost tripled since the 1970s.

And it's not even polite to talk about the health and social effects of such anxiety among the working poor, that often clouds their judgment and leads to depression. We haven't even attempted, as a society, to feel that level of empathy with our fellow Americans.

Among American workers, poll finds unprecedented anxiety about jobs, economy

By Jim Tankersley and Scott Clement

November 26, 2013 | Washington Post

URL: http://wapo.st/1evjLGj

For all you welfare hatas: U.S. charity scammers

You know, the second some "welfare queen" scams Uncle Sam out of a few thousand bucks, conservatives are all over it.  All welfare recipients are indicted.

Well, here you go, the nasty truth about the U.S. "charity business."  What say you, Christian conservatives who want to tear down the safety net and replace it with a network of charitable do-gooders who do just as good?  Does the exception prove the rule?  Does one really, really bad apple spoil the charitable bunch?

The Cancer Fund of America makes George Castanza's Human Fund look like Save the Children.

"But Obama [correction: Reagan] gives poor people free cell phones!" my low-information conservative interlocutor will protest hysterically.  (Sigh).

Intricate family connections bind several of America's worst charities

By Kris Hundley and Kendall Taggart

June 13, 2013 | Times/CIR Special Report

URL: http://www.tampabay.com/topics/specials/worst-charities3.page

Rosenberg: Obama wanted to cut safety net all along

Rosenberg "uncovers" an Obama "conspiracy" that Tea Partyers and liberals alike don't want to acknowledge: he's been plotting to cut Social Security and Medicare without raising taxes to Clinton-era levels since BEFORE he was inaugurated, before the Tea Parties even existed.

Then, when Obama proposed cutting Medicare, exactly as Republicans proposed, they attacked him for it. He doesn't understand he's playing a losing game.

Or maybe he doesn't care?:

But, of course, Obama is not going to be running again. He will be collecting speaker's fees from the donor class. And they like what he is doing just fine. Obama's real base, it turns out, is exactly the same as George W Bush's: the have and have-mores. This budget is for them and them alone. To think otherwise is to continue living in denial.

Read it and weep, everyone.

Obama's imaginary budget-cut mandate

By Paul Rosenberg

April 18, 2013 | Aljazeera

URL: http://www.aljazeera.com/indepth/opinion/2013/04/20134186829216639.html

5 myths about U.S. charities

Below is a must-read article for all you far-right conservatives who believe the U.S. safety net should be torn down... and then magically replaced, somehow, by a flood of charitable, Christian giving that will meet the needs of the poor instead.

Herein I'm re-stating Stern's 5 myths in my own words, with comments that may seem very bah-humbug and un-Christian, but so be it:

1.  Charities and non-profits are founded, primarily, to meet the ego needs of the rich and emotional needs of the aggrieved, and secondarily, to help the needy. 

How many celebrities and professional athletes have their own charities? How good do you think most of them are? Enough said.

And then think about what happens when a tragedy like a deadly illness strikes a well-to-do family: they immediately establish a memorial foundation or charity to help fight that illness, or help other victims of that illness. It's more about making those people feel like their loss wasn't in vain, and that they must save somebody else since they couldn't save their loved one. Sorry for being so un-PC; and I acknowledge that such charities do some good; but such non-profits are usually more about the grief and "making sense of it all" of the aggrieved family than they are about curing diseases and social ills. The government is better at both -- the Centers for Disease Control, government-funded research universities, passing commonsense laws, etc.

2.  It doesn't really matter what your charity does, as long as it's "good," or how effective it is in its stated mission, as long as it does it cheaply (i.e., low overhead).

We don't judge businesses or government agencies by this yardstick, so why should we think that a charity's primary mission is to do things on the cheap?  I'll tell you why: because we're cheapskates who are quite comfortable with our (mostly small) private charities working on the fringes and margins of our society, making feel-good, good-faith efforts to do things but not really succeeding. 

If we really cared about effectiveness, we would acknowledge that there is way too much overlap/redundancy in charities, and that size and economies of scale matter -- and we would actually demand monitoring of results by charities! ... But if we were to acknowledge that economies of scale matter and demand accounting for results, then we'd be forced to acknowledge that our government is better in both regards.

3.  It is a truism that higher income taxes discourage charitable giving; and charitable giving should be deducted from the giver's income taxes because he is partially replacing the government safety net (that depends on his income taxes) with his wise and effective choice in how to help the poor.

Except both of these assumptions are empirically false.

4.  It's OK for a charity to have hundreds of millions of dollars in the bank as long as it's not-for-profit; meanwhile, the median salary of a U.S. charity's executive director is $133,000.

I'm not actually saying that big charities are bad, I'm just saying that most charitable givers don't like to think about it. In fact, many prefer giving to "small" charities for the exact reason that they are resource-starved. But think about that logic for a moment. Does "smaller is better" make any sense if the idea is to muster a lot of resources and deploy them in the most efficient way to achieve desired results?

Again, neither business nor governments tend to think this way. Very few analysts say that McDonald's needs to be smaller in order to feed more people cheaply. The Pentagon doesn't tell Congress it can keep us safer if our armed forces are "leaner" and "hungrier."

5.  Good luck finding an effective and worthwhile charity to support -- it ain't easy!

Since there are so many registered charities out there and scant data on their effectiveness (because no donors demand it), unless you know the charity personally and its work... you're probably just shooting in the dark, making yourself feel good.

Five myths about charitable giving

By Ken Stern

December 27, 2012 | Washington Post

The last few days of the year may be a time of celebration and indulgence, but it is also when many people think about helping others. Though much of the roughly $240 billion in individual charitable contributions comes in December, these donations are often made hastily, based on poor information. Before writing those end-of-the-year checks, here are some things to remember about how charities work and how to evaluate them.

1. Charities are principally dedicated to serving the poor and needy.

The term “charity” is associated with helping the poor and downtrodden, but American charities — 1.1 million organizations with $1.5 trillion in annual revenue — make up a large, rapidly growing economic sector that includes health care, higher education, scientific research, social services and the arts. There is incredible diversity among charities, from tiny neighborhood food banks to multi-state hospital chains boasting lavish concierge services and million-dollar salaries for executives. In fact, hospitals are the largest component of the U.S. charitable sector, but they are more likely to be profitable than for-profit hospitals and aren’t much more likely to serve the needy.

It’s also astonishingly easy to start a charity. The Internal Revenue Service approves more than 99.5 percent of charitable applications, often in very short order. Because of this, the sector includes more than a few organizations that have little connection to common notions of doing good: the Sugar Bowl, the U.S. Golf Association, the Renegade Roller Derby team in Bend, Ore., and the All Colorado Beer Festival, just to name a few.

2. Donors should reward charities that have low overhead.

The notion that charities should put as much money as possible into services and as little as possible into overhead expenses is widely accepted. Overhead ratios, which measure the relationship between a charity’s income and expenses, are one factor in popular rating systems such as Charity Navigator and the Better Business Bureau’s Wise Giving Alliance. Charity Navigator, for example, suggests that administrative spending greater than 30 percent is unreasonable, and it rewards its highest ranking to organizations that put less than 15 percent of their resources toward such costs.

Low overhead has become a point of pride — and marketing — for charities such as the Brother’s Brother Foundation, a Pittsburgh-based relief organization whose Web site boasts that “less than 1% of the value of donations [is] used for overhead.”

But charities need to spend on research, training and financial systems, all classified as “overhead,” to be effective. Those that shortchange these investments — and many do — are less likely to achieve their goals. The American Red Cross, for instance, struggled during Hurricanes Katrina and Sandy in part because it hadn’t invested enough in the infrastructure necessary to handle complex emergency relief.

That lack of investment is partly due to public pressure, rather than a shortage of funding. When then-Red Cross chief executive Bernadine Healy tried to appropriate unused money from the 9/11 Liberty Fund to correct weaknesses in the group’s broader emergency response capacity, she was forced to resign.

3. Tax incentives are critical to charitable giving.

People with income in the lowest quintile give a higher percentage of their earnings to charity than do more wealthy Americans. This pattern persists despite the fact that low earners have less disposable income and rarely take advantage of itemized tax deductions for charitable donations. Sure, some contributions are tax-driven: Almost a quarter of online giving occurs in the last two days of the year as taxpayers rush to qualify for deductions. But Americans’ generosity may be more resistant to changes in the tax laws than most people think.

According to Congress’s Joint Committee on Taxation, the charitable tax deduction will cost the federal government $230 billion from 2010 to 2014. Some economists believe that charities would lose less than that amount if the exemption were eliminated or modified, since people give for many reasons unrelated to tax incentives. Because of the perceived unfairness and inefficiency of the current system, many analysts, including at the Congressional Budget Office, have begun to look at substantial changes, from establishing floors or ceilings for deductions (sometimes in combination with making incentives available to non-itemizers) all the way up to eliminating the deduction.

4. Nonprofits are not profitable.

In 2010, U.S. charities reported more than $2.7 trillion in assets. Even putting aside the multibillion-dollar endowments of Harvard and Yale universities, many lesser-known charities have substantial war chests. In 2007, Ascension Health, a large Midwest charity hospital chain, reported reserves of $7.4 billion, more than twice the cash on hand at the Walt Disney Co.

Some donors look for small, underfunded charities, thinking their gifts will make a bigger difference. But that is not necessarily an effective strategy. Many of the charities with strong track records in delivering results — organizations such as Youth Villages of Memphis and the Nature Conservancy — are also quite good at building financial reserves. Charities like these identify clear goals and have third parties evaluate their work, practices that are more important than how much they have in the bank.

5. It is easy to find a good charity to support.

In fact, it is enormously difficult. Not only is there considerable confusion among charities — for example, there are more than 60,000 with the word “veteran” in their names — there is little information on groups’ effectiveness. The mutual fund industry employs 159,000 people to help investors make good choices. But there are fewer than 100 people nationwide whose jobs are to help the giving public make wise donations. So what is a conscientious donor to do?

Put in the work. On average, Americans spend more time watching television in one day than they do researching charities in an entire year. Finding good charities takes time. It means using the few organizations, such as GiveWell, that do in-depth studies of charities’ effectiveness. And it means remembering that the best organizations, charitable or otherwise, are built on more than a good story or a charismatic leader.

As Warren Buffett once said: “I try to buy stock in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will.” That’s good advice when trying to make sure donated dollars actually do good.

For conservatives, charity's all about THEM

Rush Limbaugh's latest monologue on government assistance vs. charity is quite telling on his part.  Unintentionally so.

See, he sets up government assistance and charity in opposition to one another. That's not necessarily so, it's not a zero-sum game, but let's go with his conceit. So, which one is better?

I've settled this before.  First, look at U.S. poverty statistics pre- and post-LBJ's War on Poverty.  Presumably, America has been just as Christian and charitable all along, so the only independent variable here is government spending, which made all the difference.  Second, there is scant data on how effective charity is.  (I'm not talking about overhead rates; I mean, how well do they achieve their stated mission.)  Most charities don't seek to measure their effectiveness, and most contributors don't demand it in the first place.  So next time somebody tells you charity is more effective than government assistance, ask him to prove it.  He probably can't.  Or if he can, only anecdotally*.  Third, and perhaps most important, both charitable giving and poverty are pro-cyclical.  So as people's incomes go down in tough economic times, so does charitable giving.  As a result, charity is at its weakest when it's needed most.  Whereas government can borrow all it wants at low interest rates even during downturns -- especially during downturns, in America's case.  (Never mind, for now, the downsides to over-borrowing.)

Beyond the pre-eminent effectiveness of government aid, what's so telling about Rush and conservative's view of charity is their focus on the giver.  See, with government assistance there is no "should I/should I not donate" moment of moral decision-making for the giver.  The decision on the amount, the form, and the recipient, is decided by our elected officials. According to conservatives, government assistance "deprives" givers of the good feeling they get from giving.  And it "deprives" them of the moral opportunity to be good Christians and decide personally whom to give their money to.  You see, it's all about making them feel good and getting them into heaven, not helping the needy.  

That shouldn't surprise anybody, since their rock-bottom belief is that our world is evil and sinful; it is a "vale of soul-making" constructed as an elaborate test to separate the Saved from the Damned, like God's version of Survivor.  Therefore, by design we are not entitled to enjoy our time on Earth, they firmly believe.  Indeed we should expect pain and privation, perhaps even welcome the chance to endure it.  And if we are well off, well... according to Evangelicals at least, that's a sign of God's blessing for a righteous life.  Thus it is doubly sinful of government to "punish" the righteous with higher taxes as it "takes away" their chance to be charitable.  Rush dog whistles at this all the time.

I know too many Christian conservatives to say, as some liberals do, that this is all about their greed. For the super-rich One Percent, it certainly is about greed.  But for the GOP base it is not so simple.  Nay, there is a distinctly Evangelical Christian underpinning to all this.  (Rush acknowledged the rift among Christians by calling out the Catholic Church's consistent and principled stand for government aid to the needy.)  Nevertheless, it's all about their feelings and their salvation, not the needy.

(*The question of results/performance is all about them, too, in a way.  Monitoring and evaluation of results demands precious resources that many small charities don't possess. A possible way to overcome this is to have many small charities working very locally, where the results are "evident" to givers.  "Seeing is believing" for most conservatives who distrust statistics, especially government stats.  They may also want that good feeling of seeing the people they benefited.  But to have only micro-scale charity would not only be inefficient and duplicative, but also dangerously inadequate and unequal, because it would concentrate charitable giving around wealthy people, creating vicious cycles of local poverty and virtuous cycles of local well-being, both isolated from each other.)

It really does come down to whether or not you believe we're all in this together. Conservatives don't.  

If you do, then the question is not so much the how (the process of giving assistance), but the result (improved well-being for the needy).  To put it in ethical terms, liberal-progressives believe that one's personal moral satisfaction should not come from being a superior charitable giver (in relative or absolute terms, no matter); one's satisfaction should come from knowing that he contributes to a fair and just society that guarantees the basic needs and dignity of those who can't take care of themselves, for whatever reason.  Liberals don't want to live in God's obstacle course for human gerbils; liberals want to live in a normal, civilized country where everybody is better off.  It is well within our power to make that happen, therefore it is our moral obligation.  

If you're morally serious about that aim, then you have to look at statistics, you have to put pre-conceived notions aside, and make evidence-based decisions.  And government assistance, as mentioned above, has proven in every developed country to be the best way to achieve that aim.

Taxes and Welfare Do Not Equal Charity

September 11, 2012 | The Rush Limbaugh Show

URL: http://www.rushlimbaugh.com/daily/2012/09/11/taxes_and_welfare_do_not_equal_charity

'Euro-socialism' never works...except when it does

Hmm... lower income taxes, bigger social safety net, smaller deficit.  How do they get away with it?!  It must be the wine.  

ZOMG! France!! Socialism!!!

By The Stig

August 14, 2012 | Daily Kos

URL: http://www.dailykos.com/story/2012/08/14/1120154/-ZOMG-France-Socialism

Goodman: EU, US crises are avoidable, fixable

Euro Crisis Inspires Fresh Worries Of Threats To Global Economy

By Peter S. Goodman

April 18, 2012 | Huffington Post

Europe's economy is like a patient stuck in a hospital run by quack doctors who see sickness as a form of moral failing, and leeches as the preferable cure. The only hope now is that Europe either manages a miraculous recovery or develops a case of something so inarguably lethal that real doctors come running with effective medicine.

Will Europe and its beleaguered currency, the euro, get out of this crisis in one piece? That question is commanding renewed attention as financial markets demand higher rates of interest on loans to the debt-saturated nations at the center of concern, Spain and Italy, thus elevating the prospect that their governments might eventually default. Maybe the euro will endure, and maybe it won't. In any event, Europe seems irretrievably bound for years of retrenchment, diminished living standards and social strife.

"We're going into a long period of stagnation in Europe, with terrible problems that will emerge as a result," declared the former Austrian chancellor Alfred Gusenbauer, speaking Tuesday at Brown University during a conference on the future of the euro, a proceeding that felt much like an autopsy on a body that never should have been born.

"The crisis found us unprepared," said former Italian Prime Minister Romano Prodi. "How to get out of this? It will be extremely difficult."

Continued anxiety about the fate of the euro is bad news not just for Europe, but for the globe as a whole -- and not least for the United States, whose tenuous recovery from the Great Recession is feeling increasingly vulnerable. Europe constitutes the world's largest marketplace. When its people and companies are hunkered down, unable to spend and invest, the consequences ripple everywhere, including to the American factory floor, where a slowing of production is amplifying broader economic worries.

But here's the most frustrating part of Europe's unrelenting crisis and the drag it is imposing on multiple shores:  It is both self-inflicted and fixable.

The mantra at Tuesday's conference, held by the Watson Institute for International Studies, was that Europe's problems are not financial in nature, but essentially political.  If the members of the eurozone could simply agree to arm their impotent central bank with the authority to sell bonds backed by the full faith and credit of member countries, the crisis would ease.  The central bank could backstop the weakest countries in the eurozone and soothe financial markets now fretting over potential sovereign default scenarios. Borrowing costs would come back down, making it easier for the most indebted eurozone member nations to pay their bills.

This, unfortunately, is much like saying that America's economic problems can be easily fixed (which happens to be correct), so long as you ignore the political reality.   If Americans could merely agree to lift our tax rates back to the level of the Reagan years, invest the resulting revenues in productive pursuits like education and infrastructure, and then squeeze some savings out of a health care system designed primarily to succor oligopolistic insurance companies, our debt problems would disappear.  All true -- and all as politically achievable as forcing Americans to embrace a strict vegan diet.

In Europe's case, the impediments to a proper economic solution stem from the peculiar structure of the eurozone, a currency union without an accompanying political union. Seventeen individual states all share the same money, but still chart their own budgetary courses. In the first decade of the euro, which began trading in 1999, financial markets acted as if the shared currency rendered equivalent the risks of lending to Germany and Greece.  The currency masked the fundamental differences that distinguished the fiscal soundness of individual member states, giving less-disciplined governments access to too much credit.

"It was an accident waiting to happen," said Prodi.

Now that the accident is here, with Mediterranean states confronting untenable debts, a lack of political concurrence is preventing the obvious solution: a real central bank that can print euros by issuing bonds backed by all members.

Germany refuses to entertain this idea, disgusted by the prospect of putting its credit on the line for the sake of aiding weaker eurozone member states. This stance is built on a peculiarly German terror of possible inflation -- an outcome that would be wonderful compared to the current alternatives -- and a moralistic desire to punish the profligate. In the conversation that rules Berlin, hard-working, thrifty Germans cannot be expected to finance endless revelry for free-spending Spaniards, Greeks, Portuguese and Italians.

This central notion is responsible for the austerity that Germany has imposed on member states as a condition of the myriad eurozone bailouts that have so far prevented collapse. But this is where we get back to the leeches: Austerity also ensures that Europe cannot grow robustly, enhancing the debt burdens of weaker states.

"Europe is prescribing a medicine that makes the disease worse," Gusenbauer said.

This is now so apparent that even the International Monetary Fund -- traditionally a stalwart advocate of austerity in the face of budget crises, from Indonesia to Argentina -- now warns that Europe has gone too far.

Moreover, austerity imposed as moral curative misses the origins of the crisis.  Most of the debtor governments ensnared in the euro mess were not living beyond their means before the crisis.  They are now facing impossible debt burdens because they bailed out private banks that lent recklessly. The German refusal to allow euro bonds and the prevailing wave of fiscal austerity is sticking ordinary Europeans with the costs of addressing the sins of wayward banks.

Greece has come to encapsulate the whole euro story in the conventional narrative, but this is bogus. Greece is the only case in which profligacy explains the mess.  The Greeks wasted their money on unbridled government spending, corruption and tax avoidance. The rest of the eurozone landed in peril only after the red ink of private banks washed up on public balance sheets. Indeed, Ireland had much smaller debts than Germany as a percentage of its overall economy before the government rescued the banking system.  So did Spain.

In the United States, a similarly phony morality play is at work as elites wander around sagely discussing the need for the populace to commence living within its means.  American leaders cite fiscal distress as they dismantle many of the institutions that serve regular people, from community colleges to the social safety net.  But we did not get into hock by bingeing on classrooms and food stamps.  We got here via extravagant tax cuts for the wealthiest people and disastrous wars in Iraq and Afghanistan. Now, in the logic of the moment, the people who rely upon unemployment checks are going to have to pay to square the books.

In the United States, austerity is nothing more than the product of political dysfunction, an inability among people in Washington to acknowledge simple arithmetic: We need to raise taxes to pay for basic government services.

In Europe, austerity may be the sacrifice required to enable Germans to make peace with transferring some of their prodigious wealth to less-affluent neighbors.

If this is the price established by the political marketplace, it may be better than the status quo -- a long slide toward sovereign default big enough to bring down the euro and usher in another global financial crisis. Yet it is also madness, as if the patient neglected by the hospital is best served by chopping off a finger or two to ensure that the doctors finally see his case as requiring emergency intervention.

Studies: Charitable giving irrational, favors pain, not totally altruistic

The facts of human beings' emotional, irrational reactions to appeals for charity is just one more reason not to depend on private charity to take care of our brothers and sisters in need.

We should take advantage of government's economies of scale and rely on professional bureaucrats' dispassionate planning to ensure an adequate social safety net for our fellow citizens.

Why Do We Give? Not Why Or How You Think

By Alix Spiegel

November 25, 2011 | All Things Considered on NPR

New findings in the science of charity reveals some counter-intuitive results. For instance, people will give more money to a single suffering person than to a population of suffering people, and also give more when some type of physical discomfort — for example, running a marathon — is involved.

GUY RAZ, HOST: This time of year, pleas for donations are as plentiful as eggnog and door-buster sales. Americans give around $300 billion a year to charity. And as NPR's Alix Spiegel reports, psychologists have started to look more closely at when and why we're motivated to give.

ALIX SPIEGEL, BYLINE: The science of charity took off in earnest in the late 1990s, but the series of papers that attempted to understand a puzzling psychological phenomena: When people give to charity, they'll give far more money to a single suffering person than to a population of suffering people, which charity researcher Chris Olivola, of the University of Warwick, says doesn't make a lot of sense.

DR. CHRIS OLIVOLA: You should be more interested in helping more people than fewer, right? You should be more interested in helping 10 sick children than you should be interested in helping one of those 10.

SPIEGEL: But that isn't how it works. In fact, Olivola says tell donors about even two hungry children or give them statistics about hungry children generally and donations will fall by half.

ALLA VOLA: In fact, I think one of the troubling results is if you give people the photo of the child and the statistics, people are less moved than just the child. So, statistics plus photo is just like statistics by itself.

SPIEGEL: These strange findings, says Alla Vola(ph), helped inspire other charity researchers. And last year, Alla Vola and a co-author published many of their resulting studies in a book called "The Science of Giving." This book includes all kinds of surprising experiments, which examine our quirky relationship to charity, including Alla Vola's own work on a kind of charity that now seems completely ordinary: marathoning for a cause.

VOLA: On the face of it, you know, it seems great that people are making this sort of, I would say, sacrifice, but if you stopped and think about, it's kind of puzzling, right?

SPIEGEL: Marathons and other charity events of that kind are essentially asking people to suffer real physical discomfort for the privilege of then giving money, a formula that Alla Vola says probably wouldn't fly in the commercial world. If I'm going to try to sell you a car, I don't ask you to run a race first. But with charity, Alla Vola says, the more you ask people to suffer, the better.

VOLA: When people anticipate they're going to have to suffer to raise money for a charity, then their willingness to contribute to that cause actually goes up.

SPIEGEL: So, for example, in his research, Alla Vola gathered groups of people, gave them each $5 then made it possible for them to contribute a portion of that money to what amounted to a charity. But for half of the participants, there was an additional requirement before they were allowed to donate.

VOLA: If you want to give any money to the group, you're going to have to put both your hands in very, very cold, painfully cold, water for 60 seconds - very painful task.

SPIEGEL: Now, the people who were not asked to suffer only gave about $3; and the people who were asked to suffer?

VOLA: What we found was that people in that condition, the cold water condition, gave more money. They gave four out of five dollars to the group, even though we basically give them incentive not to give.

SPIEGEL: Another interesting new finding comes from an Israeli psychologist at Ben Gurion University named Tehila Kogut. Kogut says that in Israel, like in America, people are constantly bombarded with telephone requests from charities seeking funds. And she says most of her friends have a method for dealing with these calls.

TEHILA KOGUT: They just don't pick up your phone when they don't recognize the number because they don't want to be asked for a donation. They say, why don't you say just no? Well, it's a problem to pick up the phone and say no.

SPIEGEL: To better understand why people avoid saying no, Kogut did a series of studies which ultimately made clear that people give to charity not just out of altruism or empathy but also curiously to protect themselves. Say you're called on a phone by a cancer charity and asked to donate. Well, the very act of being asked, Kogut says, brings on a miniature existential crisis.

KOGUT: They feel that if they say no, the probability that they will have cancer, it will increase. That this is an act of tempting fate.

SPIEGEL: Giving then is in part an attempt to ward off disaster. Now, as for implementing some of these insights, most of the researchers interviewed said that so far relatively few charitable organizations seem to be using the research on giving to shape their appeals. They should, though, Alla Vola says. (unintelligible) has a lot to say about when and why we give. Alix Spiegel, NPR News, Washington.

Half of U.S. recipients say they haven't used a gov't social program -- GROAN!

But I pays all 'dem taxes fur my Medicare! I ain't some lazy soshlust, I earnt it!

Seriously though, this begs the question: are Americans 1) dumb, 2) ignorant, or 3) in denial? Regardless, this doesn't bode well for our republic.

Half of US social program recipients believe they "have not used a government social program"

Posted by Cory Doctorow

July 8, 2011 | Boing Boing

Table URL: http://craphound.com/images/programbeneficiaries.jpeg

"Reconstituting the Submerged State: The Challenges of Social Policy Reform in the Obama Era," a paper by Cornell's Clinton Rossiter Professor of American Institutions Suzanne Mettler features this remarkable chart showing that about half of American social program beneficiaries believe that they "have not used a government social program." It's the "Keep your government hands off my Medicare" phenomena writ large: a society of people who subsist on mutual aid and redistributive policies who've been conned (and conned themselves) into thinking that they are rugged individualists and that everyone else is a parasite.