Alan Greenspan on the mortgage crisis: "I didn't do it!" - All Salon

The end of the Cold War is the real villain, declares the Maestro. Now the U.S. no longer controls its own financial destiny

The credit crisis must be endangering the Maestro’s legacy. How else to explain Alan Greenspan’s defensive analysis of how the markets went awry in “The Roots of the Mortgage Crisis,” published in Wednesday’s Wall Street Journal.

As Greenspan sees it, the Fed’s post-dot-com crash easy-money policy is not to blame for the unsustainable housing boom and subsequent bust. Rather, the real culprit was the end of the Cold War and the victory of American-style market capitalism across the globe, (what Martin Wolf calls the “Anglo-Saxon model of capitalism”).

As with all good cover stories, there’s a kernel of truth in this one. The collapse of the Soviet Union and concurrent opening up to world trade of China and India resulted in the incorporation of billions of new workers into global labor markets, marking a profound change in the dynamics of the global economy. That is indisputable.

Greenspan is not alone in believing that one result of this epochal change was to keep inflation in check throughout the world, and thus exert downward pressure on longterm interest rates.

The surge in competitive, low-priced exports from developing countries, especially those to Europe and the U.S., flattened labor compensation in developed countries, and reduced the rate of inflation expectations throughout the world, including those inflation expectations embedded in global long-term interest rates.
The Fed was correct, says Greenspan, to lower interest rates all the way down to 1 percent in 2003 in an effort to avoid a major recession, but the real surprise came when the Fed started to move short term rates back up.

In mid-2004, as the economy firmed, the Federal Reserve started to reverse the easy monetary policy. I had expected, as a bonus, a consequent increase in long-term interest rates, which might have helped to dampen the then mounting U.S. housing price surge. It did not happen. We had presumed long-term rates, including mortgage rates, would rise, as had been the case at the beginnings of five previous monetary policy tightening episodes, dating back to 1980. But after an initial surge in the spring of 2004, long-term rates fell back and, despite progressive Federal Reserve tightening through 2005, long-term rates barely moved.
In retrospect, global economic forces, which have been building for decades, appear to have gained effective control of the pricing of longer debt maturities.
It makes for a nice story. Capitalism triumphed all over the world, and then proceeded to eat itself. And the U.S. is no longer the supreme arbiter of its own fate — it is now just another pawn moved about by far greater forces. And thus, Fed policy can’t be blamed for inciting the current turmoil.

I do not doubt that a low U.S. federal-funds rate in response to the dot-com crash, and especially the 1% rate set in mid-2003 to counter potential deflation, lowered interest rates on adjustable-rate mortgages (ARMs) and may have contributed to the rise in U.S. home prices. In my judgment, however, the impact on demand for homes financed with ARMs was not major.
There’s a part that Greenspan is leaving out, however: his own role as a cheerleader for ARMs. In a speech to the Credit Union National Conference in February 2004, he lavished praise on adjustable rate mortgages, and in effect told American consumers that they were being financially imprudent by not signing on the ARM dotted line.
The relevant section is worth quoting in full: ( italics are mine)

One way homeowners attempt to manage their payment risk is to use fixed-rate mortgages, which typically allow homeowners to prepay their debt when interest rates fall but do not involve an increase in payments when interest rates rise. Homeowners pay a lot of money for the right to refinance and for the insurance against increasing mortgage payments. Calculations by market analysts of the “option adjusted spread” on mortgages suggest that the cost of these benefits conferred by fixed-rate mortgages can range from 0.5 percent to 1.2 percent, raising homeowners’ annual after-tax mortgage payments by several thousand dollars. Indeed, recent research within the Federal Reserve suggests that many homeowners might have saved tens of thousands of dollars had they held adjustable-rate mortgages rather than fixed-rate mortgages during the past decade, though this would not have been the case, of course, had interest rates trended sharply upward.
American homeowners clearly like the certainty of fixed mortgage payments. This preference is in striking contrast to the situation in some other countries, where adjustable-rate mortgages are far more common and where efforts to introduce American-type fixed-rate mortgages generally have not been successful. Fixed-rate mortgages seem unduly expensive to households in other countries. One possible reason is that these mortgages effectively charge homeowners high fees for protection against rising interest rates and for the right to refinance.
American consumers might benefit if lenders provided greater mortgage product alternatives to the traditional fixed-rate mortgage. To the degree that households are driven by fears of payment shocks but are willing to manage their own interest rate risks, the traditional fixed-rate mortgage may be an expensive method of financing a home.
It would be silly to suggest that your average American would-be homeowner was paying such close attention to the Federal Reserve chairman’s daily utterances that the day after his ringing endorsement of “mortgage product alternatives,” they charged down en masse to the nearest broker and demanded a no-money-down Option ARM. But as a signal to those who do pay attention to every breath taken by the Fed chair — Wall Street money men — the message was loud and clear; it was the starting gun for the Indianapolis Exotic Mortgage 500.
In the larger scheme of things, the praise for ARMs is small beans compared to Greenspan’s support of the proliferation of complex structured financial products, which were supposed to stabilize the world’s financial system by widely dispersing risk. That hasn’t worked out too well either.
Greenspan is doing a lot of wriggling, but the longer the current crisis lasts and the deeper the damage wrought, the harder it will be for him to get off the hook. He was there at the creation, his rhetoric supported it, and he did nothing whatsoever to stop it.

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Occupy Valentine’s Day

From a "Parks and Rec"-inspired holiday to Quirkyalone Day, the "romantic-industrial complex" is under attack

By Tracy Clark-Flory

(Credit: CLM via Shutterstock/Salon)

Topics:Valentines Day, Sex, Love and Sex

A man and a woman are lying in bed under the covers, both of them beaming. She’s holding a handwritten sign that reads in part, “F–k a dozen roses.”

It’s one of several photos on the web site Occupy Valentine’s Day, which applies the ethos of the anti-Wall Street movement to the consumerism of cupid’s holiday — and it’s just the latest attempt at creating an alternative celebration. “I think we need a new and different type of analysis around relationships,” says Samhita Mukhopadhyay, the site’s creator and author of “Outdated: Why Dating Is Ruining Your Love Life.” “This is not about being anti-love, but instead anti the unfair structures that forces us to love a certain way.”

A big part of that is that is the “romantic-industrial complex that nets billions of dollars from Valentine’s Day and weddings, and it needs you to ‘buy into’ outdated ideas of love and marriage,” she wrote in a recent op-ed for The Nation. “The more you express your love through candies, chocolates, diamonds, rentals and registries, the more the RIC makes!” (Indeed, it’s estimated that consumers will spend roughly $17.6 billion on cards, chocolates, flowers, jewelry and the like this February 14.) But instead of just trashing V-Day — or VD (i.e. venereal disease) Day, as its biggest haters like to call it — she wants to honor “the different ways we engage in loving relationships.”

A less political alternative is one introduced by everyone’s favorite fictional mid-level bureaucrat, Leslie Knope of NBC’s “Parks and Recreation.” She celebrates “Galentine’s Day” every February 13th by getting together with her ladyfriends for a brunch of her signature dish, whipped-cream with a side of waffle, to celebrate female friendship. Leslie doles out quirky gifts (sculptures of everyone’s spirit animal or mosaics of their faces made out of crushed diet soda cans, for example). She compares the celebration to Lilith Fair — “minus the angst and plus fritatas.”

Granted, Galentine’s Day started as a comedy punchline, but the concept was popular enough in the real world that this year NBC put together a guide on how to create your own Galentine’s Brunch. Bon Appetit even cooked up a special waffle recipe for the occasion. It’s also inspired DIY-ers to make Galentine’s Day e-cards and recreate some of Leslie’s more memorable gifts, like crochet flower pens.

Of course, “Parks and Recreation” didn’t invent the idea of single friends getting together on Valentine’s Day — that’s no doubt been around as long as the holiday itself — it just popularized a cute term for it. Let’s not forget the gender-inclusive Palentine’s Day, Singles Awareness Day, or the concept of having a friendly “anti-valentine.” Greeting card companies are increasingly cashing in on anti-Valentine’s Day card for friends, including — gasp! — Hallmark itself.

A similarly heartwarming option is Quirkyalone Day, founded by Sasha Cohen, author of “Quirkyalone: A Manifesto for Uncompromising Romantics,” a book about people who “prefer being single to dating for the sake of being in a relationship.” She tells me, “I’m not against Valentine’s Day, but I have never been particularly inspired by it. The aim of International Quirkyalone Day is to offer a fresh alternative where you get to create your own day free of all cliches.” It’s an excuse to “celebrate yourself and your whole life,” she says, and that can manifest in a number of different ways: “take a long walk alone (leave behind your cell phone), buy yourself daisies, start a neglected creative project, buy yourself hot lingerie, get a massage, host a dinner party.”

Of course, not all Valentine’s Day alternatives are so charmingly earnest. Anti-V-Day events across the country call on bitter singles to bring a photo of their ex to put through a paper-shredder or pin to a dart board, or exact some other form of questionable revenge. And make no mistake, while it’s nowhere near a $16 billion industry, there is a market for Cupid-hating goods — from cards reading “Love stinks” to T-shirts featuring upside-down hearts to candy hearts with sayings like, “U left seat up” and “Dog is cuter.” The social network game Farmville even has virtual anti-Valentine’s Day items for purchase, like a barbed heart and a black flower. The truth is this isn’t anything new: Long before there were pithy e-cards, there were Victorian-era vinegar valentines, insulting cards sent to one’s enemies.

Why has the holiday generated such cynicism and, sometimes, downright hatred? Cohen says, “Valentine’s Day has this way of making people feel bad, whether they are single or in a relationship. If you are single, you feel left out. If you are dating or in a relationship, you feel pressure and expectation to have a romantic evening.” She’s all for “a pure celebration of love in all its forms,” but “the problem is when we narrow that definition of love to a romantic connection.” Cohen explains, “Almost 50 percent of American adults are single, so people are bound to feel left out. It’s sort of like a Thanksgiving that only 50 percent of the population feels invited to.”

: Tracy Clark-Flory is a staff writer at Salon. Follow @tracyclarkflory on Twitter. More Tracy Clark-Flory

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Pakistan’s crippling turf war

A tense standoff between the military, government and judiciary could throw the nation into turmoil

By Suzanna Koster, GlobalPost

Pakistani Prime Minister Yousuf Raza Gilani waves upon his arrival at the Supreme Court for a hearing in Islamabad, Pakistan, Monday, Feb. 13, 2012 (Credit: AP Photo/B.K. Bangash)

This article originally appeared on GlobalPost.

ISLAMABAD — Pakistan’s story has long been dominated by a power struggle between its two main characters: the country’s mighty military and its weak civilian government. Now, as if the story weren’t sordid enough, the rise of Pakistan’s judiciary has introduced a third character, one that analysts worry could be highly unpredictable.

Its power was on display this week when the country’s Supreme Court formally charged Prime Minister Yousaf Raza Gilani with contempt of court, a move that could eventually lead to the leader’s dismissal.

And then, not to appear unfair, the court took on the military as well. For the first time in the country’s history, Pakistan’s Supreme Court forced the Inter-Services Intelligence agency (ISI), the country’s formidable spy organization, to bring before the court seven prisoners it is accused of detaining illegally.

Proponents and critics raise points from both ends regarding the surge of the judiciary’s power.

A stronger judiciary, one that is willing to hold the government and the military accountable, could be good for Pakistan, observers said. But many of them remain wary, unsure whether the court’s intentions are honorable or dubious.

Gilani, flanked by ministers, governors, coalition partners and other supporters, appeared surprisingly calm during his visit to the court on Monday.

Outside the imposing courthouse, helicopters hovered and riot police guarded the entrance.

Gilani is charged with contempt for not writing a letter to the Swiss authorities asking them to reopen corruption cases against President Asif Ali Zardari, who as head of the ruling political party, is also his boss. Gilani pleaded not guilty, arguing that Zardari enjos immunity as president.

Constitutional experts say that if convicted, Gilani could appeal. And as a last resort, the president could pardon him. Gilani said in a recent interview with Al Jazeera however that, if convicted, he would automatically lose his parliamentary seat and thereby his post as prime minister.

It would be a major shake-up for the civilian government, which has so far survived multiple confrontations with the military and the judiciary and as a result, and against all odds, has become the longest-serving civilian administration since the 1970s.

The Supreme Court also heard the case of eleven prisoners in custody of ISI – four of whom died in mysterious circumstances. The court had asked the shadowy spy agency to produce the seven remaining prisoners before the court twice last week, but they never showed.

The court persisted, and officials at ISI finally relented on Monday. The prisoners looked frail, with dark circles around their eyes. A number of them needed someone’s support to walk, and one held a catheter.

The chief justice ordered hospital treatment for all seven. The next hearing is scheduled for March 1 and will seek to clarify, among other things, how the four died and whether or not any of the prisoners received a fair trial.

The seven men had an emotional reunion with family members who they had seen only a few times since they were picked up by the spy agency almost five years ago.

“Prove our crime! Prove our crime!” screamed Mohammad Shafiq, one of the detained prisoners, as his brother held him. Asked whether he thought justice would be served, he shook his head and tears ran down his face. “Why not?”

The two cases seem to indicate that the country’s judiciary is asserting its independence and, perhaps, a new found bravura that began to develop during the rule of former President Pervez Musharraf.

Pakistani judges had in the past largely been lackeys of the government and the military. But when Musharraf suspended Chief Justice Iftikhar Mohammad Chaudhry for “abuse of office” in 2007, a march toward greater independence began.

Musharraf’s move was widely seen as an attempt to preempt a court decision that would have invalidated his reelection. Thousands of emotional protesters, led by prominent lawyers, took to the streets. Never before had Pakistan’s judiciary enjoyed such popular support.

In 2008, after the election of the current government and a year of prodding, Chaudhry was finally reinstated.

Since then, Pakistan’s judiciary has become more aggressive, drawing its power in part from widespread dissatisfaction with the performance of the civilian government and from a press that is asking more questions than it did a decade ago.

Although the government has been tripped up by its clashes with the military and the courts, the public hasn’t forgiven it for presiding over a period of economy disaster. Double-digit inflation has plagued Pakistan for the greater part of the government’s tenure, and foreign direct investment has dropped significantly in the face of security concerns. A severe energy crisis has also hampered economic growth, which is already not half of what it needs to be to sustain the yearly influx of new workers.

The media has also played an important role in the the military-judiciary-government power equation, said Ali Dayan Hassan, director of Human Rights Watch in Pakistan. In the last 10 years, it has presented more alternative views than Pakistan has ever seen before, but it still faces taboos.

“You have a situation where there are three actors engaging in a political turf-war and the media is only really free to hold one of them in account. It is not that some media do not try and do it, but if the prime minister can be summoned for contempt of court, so can any journalist,” he said. Many journalists in Pakistan censor themselves to protect against possible retaliation from the military, the courts or the government.

The courts, it seems, much like the military, appear to be interested in more than the fair application of the rule of law. Opponents say it has ventured too far into the political realm, which could ultimately hurt the country’s efforts at democratic reform.

“The Supreme Court has literally taken over executive functions. Even if we take the chief justice’s intentions positively, it is still dangerous. It has to keep status quo. It is not meant to be a revolutionary institution,” said Fawad Hussain Chaudhry, a lawyer from Lahore.

The Supreme Court has intervened on political decisions repeatedly since its chief was reinstated. It nullified the carbon tax a week after the government introduced it, for instance. It also suspended the privatization of state companies and even, at one point, set sugar prices, a move many saw as an obvious over-stepping of its responsibilities.

Average Pakistanis have also accused the court of targeting the government unfairly, leading to conspiracy theories that the court is being supported by the military, which has at times acted openly hostile toward the current civilian leadership.

A wave of public criticism may have persuaded the Supreme Court to pursue the case of the eleven prisoners, as well as another, 15-year old case that accuses the ISI of using taxpayer’s money to support political opposition parties in the 1990s.

For others, the Supreme Court is a modern judicial Robin Hood. Analysts say it has recovered tens of billions of rupees (comparable to hundreds of millions of U.S. dollars) by pursuing corruption cases.

“Imagine, had there been no judicial activism, Pakistan would have been in further abyss,” said Umar Cheema, an investigative reporter for The News, a daily newspaper based in Islamabad.

The rise of the judiciary comes at a time when the original battle, the one between the government and the military, is beginning to change. Lacking popular support, the military is no longer able launch an overt take-over, as it had before — three times in the last 64 years.

Rashid Rehman, editor of the Daily Times, another Pakistani newspaper, said that opposition political parties are no longer willing to back a coup, which has forced the military to devise other ways to vie for power.

A battle between the two erupted earlier this year with the surfacing of an unsigned memo, allegedly written by Pakistan’s government, that asked for Washington’s help in preventing a military take-over.

The courts, of all institutions, will likely be forced to resolve the fight, which has been dubbed Memogate by the media. A judicial commission is set to hear the main witness, the Pakistani-American Mansoor Ijaz, who first revealed the existence of the memo last year, on Feb. 22, via a video link from the Pakistani embassy in London.

The turf-war between the three groups has two possible outcomes, said Hassan, one very good and one very bad.

“Either this process will lead to all stakeholders to understand the limits of their domains, or it will lead to confrontation and a break down of constitutional order,” he said.

: More Suzanna Koster

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What a GOP cave looks like

The House’s top Republicans desperately want to retreat on the payroll tax – if the Tea Party lets them

By Steve Kornacki

House Speaker John Boehner of Ohio listens at left as House Majority Leader Eric Cantor of Va., talks about jobs and the latest government report on unemployment, Friday, Feb. 3, 2012, during a news conference on Capitol Hill in Washington. (AP Photo/J. Scott Applewhite) (Credit: AP)

Topics:Opening Shot

Since the 112th Congress was seated more than a year ago, the Republican House Conference has served as a generally reliable reflection of the Tea Party movement’s passions and priorities. A significant chunk of its members — mainly freshmen, but also some veterans — are explicitly aligned with the movement, while those who aren’t know better than to break too loudly or too publicly with it, lest they fall victim to a primary challenge.

This is why Speaker John Boehner, a Capitol Hill lifer whose political biography invites automatic Tea Party suspicion, has been repeatedly forced to subordinate his best judgment to the zeal of purity-obsessed rank-and-filers. And it’s why Boehner’s surprise decision yesterday to support a payroll tax cut extension even if it’s not paid for represents a real gamble — one that seems grounded in a reasonable calculation but that still has the potential to create another serious political mess for him and his party.

The political logic of his move is obvious: If an extension isn’t implemented by the end of the month, tens of millions of middle class Americans will face an election year tax increase — one for which congressional Republicans, who’ve seen their poll numbers drop lower and lower with each showdown they’ve forced with President Obama, will likely take the blame. Given the relatively low cost of an extension, it hardly seems worth risking further damage to the GOP brand, especially since the party’s hold on the House is somewhat tenuous.

But as the past 13 months have demonstrated, this sort of political logic doesn’t tend to hold sway with the Tea Party crowd, which has convinced itself that rigid, compromise-averse devotion to ideological purity is the key to a sustained GOP revival. It helps that many of the true believers in the House come from safely Republican districts where there’s little or no threat of a general election backlash. So the risk for Boehner is that Tea Party Republicans in the House — and influential Tea Party leaders outside the House — will deem his payroll tax move a sellout, since it would add to the deficit.

And by last night, there were some ominous signs for the Speaker. As Politico reported:

The announcement shocked rank-and-file members, who were back in their House districts. Senate Republicans were likewise caught off guard — even one GOP leader who was trying to negotiate a compromise had no idea it was coming.

And conservative ire rose throughout the day, threatening to derail Speaker John Boehner’s plan to take the thorny issue off the table.

[SNIP]

More than a half-dozen House Republicans, reached directly by POLITICO, declined to comment on the record about the decision, saying they wanted to hear the case from their leadership when they return Tuesday. GOP leadership said the decision to move forward with this plan depends on reaction from the rank and file.

The good news for Boehner is that he didn’t make his announcement alone. Cantor, the ambitious majority leader, has a poisonous relationship with Boehner and is far more trusted by the Tea Party crowd, so it seems significant that he was willing to team up with him here. It could dissuade other conservatives from picking a fight, and it could also be a sign that the leadership has done its homework and determined that there’s no real threat of another Tea Party uprising.

If the House GOP does go along with Boehner and Cantor, it would suggest that the December payroll tax battle really did rattle rank-and-file members, even those who spent 2011 demanding absolute purity — that they are now more conscious of and responsive to the potential national impact of hard-line posturing. It would also suggest that Obama’s improving political fortunes are having an effect. The question is whether this would have any broader implications. House Democrats are apparently hoping to roll a GOP payroll tax cave into other previously unimaginable concessions on extended unemployment benefits and a Medicare doc-fix. If they’re able to do that, then what else that was impossible in 2011 might be possible in 2012?

If Boehner and Cantor prevail, it might also deflate (at least a little) one of the GOP’s favorite anti-Obama talking points. After all, Republicans across the country spent most of yesterday decrying Obama’s proposed budget for failing to tackle the deficit more aggressively. And yet, if they now sign off on the Boehner/Cantor plan, they’ll be voting to increase the deficit. What’s more, as Jonathan Bernstein pointed out, they’ll be doing so even though Democrats were willing to offset the expense by raising more revenue from the wealthy:

In other words, when push comes to shove, they’d much rather increase the federal budget deficit than to raise even a dime of taxes on wealthy Americans.

Look for Obama to point that out once or twice this year when Republicans attack him on the deficit.

: Steve Kornacki writes about politics for Salon. Reach him by email at SKornacki@salon.com and follow him on Twitter @SteveKornacki More Steve Kornacki

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Occupy fights the law: Will the law win?

From Boise to Nashvile, the movement faces an unconstitutional legal siege

By Arun Gupta and Michelle Fawcett

Occupy Boise is under legal and meteorological siege. (Credit: AP/John Miller)

Topics:Occupy Wall Street, Occupy Boise, National Lawyers Guild, Editor's Picks

The Occupy movement is an exercise in the workings of power whether it is social, financial, policing or political. The occupations that began in September spread with an infectious passion. By October hundreds of encampments had popped up nationwide with the tacit cooperation and sometimes explicit approval of local officials. For a few heady weeks Occupy Wall Street had the glow of popular legitimacy – social power – trumping whatever fusty laws prohibited camping or a continuous presence in a public space.

The inevitable counteroffensive was launched in November. Using the mass media, politicians hyped the movements as imminent threats to public health and safety, justifying aggressive evictions of prominent occupations in Oakland, Calif., Portland, Ore., and New York City. The police violence and mass arrests, the tried-and-true methods of state power employed to suppress radical movements, backfired and the movement grew more. Within weeks other major encampments in Los Angeles, Seattle, Boston and New Orleans were scattered with hundreds of arrests. A third wave of closures has been underway since late January with occupations shut down from Hawaii to Miami and Austin, Texas, to Buffalo, N.Y.

Nonetheless, some encampments survive. In Houston a small contingent is legally maintaining a presence in downtown Tranquility Park, though a ban on tents and tarps has kept all but the hardy or desperate away. In Tampa Bay, after months of police harassment, occupiers found a safe haven in a privately owned public space donated by a wealthy supporter.

Now, a new strategy is being deployed to yank the rug from under occupations in four cities: legal power. Politicians have recently passed laws in Honolulu and Charlotte, N.C., that with a stroke of the pen made the occupations illegal, enabling police to sweep them away. Two more occupations, in Boise, Idaho, and Nashville, may be nearing the end as their respective state legislatures are on the verge of outlawing the democratic villages that for months have been thriving next to edifices of power. Critics charge that the anti-Occupy laws reveal how the law is not an objective code that treats everyone equally, but an arbitrary weapon wielded by the powerful.

In a separate case, the Hamilton County Commission in Tennessee gets the award for the most innovative and dicey use of the law. After passing a law on Jan. 4 that bans various activities that Occupy Chattanooga is engaged in, the commission filed suit in federal court against nine alleged occupiers, asking for a determination that the law is constitutional as well as payment for legal fees. Lawyers for the group have filed a motion to dismiss, and the suit does appear to be on shaky legal ground because “the county is trying to impose a monetary penalty on a group of innocent people for their political activity.”

Heidi Boghosian, executive director of the National Lawyers Guild, a progressive bar association founded in 1937, says, “Clearly the law is used politically. Occupy has shed a spotlight on that fact. Laws are enacted arbitrarily and interpreted as to how the status quo wants to interpret them.” She points to how camping in public space – the main rationale for shutting down occupations – is routinely allowed and even assisted by police when thousands of consumers camp overnight for Black Friday sales, the latest iPhone model or concert tickets.

On Dec. 9, the city of Honolulu approved a sweeping anti-homeless ordinance that the local ACLU testified against as being “a particularly egregious attack on the homeless.” The new law was used to arrest Occupy Honolulu members in late December and to clear out their encampment in early February, though organizers report that they are still camping in a park overnight and putting away their tents every morning.

In Charlotte, as a welcoming gift for this year’s Democratic National Convention, the City Council passed an ordinance on Jan. 24 banning camping on city property, prohibiting items such as glass bottles, sparklers, police scanners, scarves, backpacks, duffel bags and coolers within the boundaries of an “extraordinary event,” and criminalizing the use as a “projectile” of “animal parts or fluids, manure, urine, feces or other organic waste by-products.” Less than a week after the anti-camping ordinance passed, police busted up the Occupy Charlotte encampment on the Old City Hall grounds. (No word if the police have nabbed any feces flingers yet.)

As for Boise and Nashville, both the Idaho and Tennessee legislatures are set to enact their anti-Occupy bills by wide margins, but occupiers are hoping they can convince a court to block or overturn the laws because they are arbitrary. In Idaho’s case the punishment for camping only amounts to an infraction, a non-arrestable offense, while in Tennessee those in violation could be jailed for up to 364 days and fined $2,500.

Boghosian says these laws will likely be challenged in court as unconstitutional. “It’s one thing to say people can’t sleep in the parks after midnight, but it’s another to create that law after they have already camped for an extended period of time. That is a political act … In several jurisdictions we have seen laws created targeting specific people who have a political message. As well, existing laws are frequently being enforced arbitrarily based on the political content of the message and that violates the First Amendment.”

There is another troubling legal trend impacting the Occupy movement, according to Boghosian. She says that since protesters nonviolently shut down the 1999 World Trade Organization ministerial in Seattle, the National Lawyers Guild has observed how police work with municipalities to create ordinances in advance of “national special security events” such as the Charlotte law. Boghosian says the “event-specific ordinances are often found to be unconstitutional. They ask for prohibitive insurance. They ask for restrictive permits. They tie protesters up in court and this distracts them from the message. It becomes another way the government chills free speech.”

In Chicago, where occupiers deride mayor and former Obama chief of staff Rahm Emanuel as “Mayor 1%,” the city has enacted its own questionable event-specific ordinance for the planned NATO and G-8 summits this May. Chicago activists call it the “sit down and shut up” law because of the onerous restrictions it places on freedom of speech and public assembly. Boghosian says this is another arbitrary use of the law as it is designed to go after political messages of specific groups.

The battle of Boise

Occupy Boise strategically choose to plunk down on the grounds of the old Ada County Courthouse next to the Idaho Capitol, says Bryan Walker, a 47-year-old practicing attorney active with the group. “We selected the site because there was no statute on the books prohibiting Occupy Boise from camping there.” Walker says the occupiers informed Idaho’s Department of Administration they were going to use the courthouse grounds, and presented “operational plans” but did not ask permission. “The state acknowledged they did not have legal authority to prevent us from occupying the spot,” he added.

The camp was set up on Nov. 5, and when I visited weeks later the organization was impressive and the lack of police surprising. It included tents serving as a kitchen, dining area, a free clothing store, arts and crafts, childcare, medical care, psychological and spiritual counseling and even a workers center.

One factor in Occupy Boise’s careful planning, explains Walker, is the presence of older members such as himself and his wife, Cyndi Tiferet. “We tend to have more patience,” he says. “There are a myriad of tools at our disposal, and we’ve been waiting for a movement like this for a long time, so we are ready to do it for the long haul.” Occupy Boise has been careful to stay within the legal boundaries and has had only a handful of problems with substance abuse or violence that have marred other occupations. When I spoke to Tiferet on the courthouse grounds, she said their legal status kept relations cordial with the police who were maintaining a low-key presence.

As evidence for Occupy Boise’s neighborly presence, Walker pointed me to a letter from Boise Chief of Police Michael Masterson, dated Jan. 31, commending the occupiers for conducting “themselves in a civically responsible (law abiding) and peaceful manner. We have found our ongoing dialogue to be helpful, constructive and respectful.”

He wasn’t just delivering warm tidings, however. Masterson wrote that because “the State of Idaho may very soon enact legislation that prohibits camping on state property … we anticipate that it may ultimately impact our future relationship.” What he wanted was for the occupiers to clean up the site and skedaddle “prior to any enforcement action.”

Masterson was referring to a bill introduced at the beginning of the 2012 Idaho legislative session with the sole purpose of banning camping on state property. The bill’s legislative intent is “to regulate the use of the grounds of the Capitol Mall and other state-owned and leased grounds and facilities in order to prevent the unauthorized use of these grounds and facilities as a temporary or permanent place for camping, lodging or living accommodations.”

The superfluous nature of the bill is not lost on observers. It’s a case, as the Idaho Statesman puts it, of “trying to solve a problem that doesn’t exist. … As a response to Occupy Boise, this bill makes its sponsors look like they are out to quash public protest.”

Because the bill singles out one group, it may backfire. Walker asserts, “The legislation is weak on due process grounds. The intention is to put an end to our vigil, which is protected freedom of speech. It is an abridgement of our first amendment rights.” The bill is designated as an emergency, meaning it will go into effect once it is signed into law instead of the state’s normal process of enacting new laws on July 1.

Ironically, the bill has been a boon to Occupy Boise. Walker says, “If this legislation had not cropped up we may have ended the camp already. But it gave us precisely what we wanted, the political expression.” Rather than diverting their energy, says Walker, “It’s been a huge favor because the media attention has been incredible. It has given us the bully pulpit … The letters to the editor and comments on articles about the proposed legislation have shifted markedly in our favor. It’s gone from people griping about damage to the grass to saying you need to listen to these people.”

Occupy Boise has mobilized up to 60 people to attend various legislative committee hearings on the bill, which Walker says has been an empowering experience. “I had never testified before the legislature and here I am doing it. People from the camp are showing up and testifying in House and Senate Committee hearings. People who are homeless or who have come out of prison with no training or resources are coming into the Capitol, standing before their senator or sepresentative and having their say.”

Even though the anti-camping bill passed the Idaho House by a 53 to 16 margin (and is now before the state Senate), the occupiers’ regular and, by all accounts, respectful presence in the legislature won them the support of the entire Democratic caucus plus three Republicans. Not all legislators see it that way. The House speaker has ordered the building to be locked down, which is designed to be open to the public. The body has been prohibiting signs and placards in the chambers, and on one occasion asked a dozen occupiers to remove American flags pinned to their clothing.

Walker says, “In more than 120 years in the state of Idaho the Legislature has never felt a need to do that before. Plus the high level of security they are pouring into the statehouse has provoked comments to the legislators like, ‘What are you afraid of? They are doing exactly what you want them to do.’”

As for next steps, if the bill passes as an emergency measure then Occupy Boise will almost certainly fight it in court. Walker says, “If we don’t have to decamp until July, then it’s up to the general assembly to decide if we should stay or not. My opinion is we need to go with what’s effective and focus on our goals.”

Safety in Nashville

Occupiers in Nashville have traveled a similar, if bumpier, road. On Oct. 7 they descended on the Legislative Plaza within sight of the state Capitol, Supreme Court and Legislature. Michael Custer, a 46-year-old line cook, musician and father of four, calls it “the place to address the state of Tennessee,” adding that “it’s always been used for that.”

Gov. Bill Haslam’s administration wasn’t too happy about that. So it secretly drafted a nighttime curfew on the plaza, and hours after unveiling it on Oct. 27 began hauling away members of Occupy Nashville and their gear. The problem was, in trying to criminalize Occupy Nashville Haslam was acting illegally. The state arrested more occupiers the following night, but night court Judge Tom Nelson refused both times to keep the protesters jailed because “I can find no authority anywhere for anyone to authorize a curfew anywhere on Legislative Plaza.”

Days later Federal District Court Judge Aleta Trauger issued a temporary restraining order on the new policy and observed, “I can’t think of any more quintessential public forum than the Legislative Plaza.” Trauger added that the state was at fault for exercising “clear prior restraint of free speech,” and two weeks later issued a preliminary injunction on the policy.

Notching a victory against governmental abuse of power was a shot in the arm for the Nashville group. But the preliminary injunction noted the state could still enact new laws regarding the use of the public area, while Occupy Nashville and others could likewise challenge those rules.

According to Michael Custer, the occupation has stabilized at a few dozen regulars while the state has pursued an underhanded strategy to chip away at its support while preparing to legislate it away. As in Boise, police have been largely absent from the Legislative Plaza, but in Nashville’s case that’s a problem.

Custer explains that “unsavory vagrants” are the issue. “We have a pretty small group and, well, we’re easily intimidated. So we had to call the city police many times to get violent people removed from the camp.” Calling the police was a difficult decision for occupiers, says Custer. “We do band together and try to chase off the violent people. We will call the police when violence is happening on the plaza, and it hurts to do it, but we’re not going to let the violence happen.”

Now, says Custer, the police are “using the injunction that we have against them to justify why they’re not there.” When they call to file a complaint the police retort, “Yeah, well, we can’t tell you apart. Y’all look the same to us!” He adds that they have informed the state “many times” of their code of conduct against drinking on the plaza, possession of drugs, sexual assault or harassment or violence.

The Nashville media have reported on the protesters’ “pleas for improved security,” to which one official responded that the state cannot “go out and, in effect, baby-sit protesters 24/7.” The concern about manpower did not stop the state from reportedly deploying more than 70 state troopers and other law enforcement personnel to enforce the now defunct curfew two nights in a row. And both the city and state had enough resources to infiltrate undercover police into the Occupy Nashville movement from the beginning.

At this point the damage is done. Custer says some media stake out the site looking for footage of public urination or drug use that then shows up on the nightly news as the face of the movement. Over the last few months, Custer says, polling has shown public approval of Occupy Nashville drop from 70 percent to 30 percent.

This loss of social power has opened the door to wild claims about Occupy Nashville that are used to legitimize the legal attack. Rep. Eric Watson, who introduced the anti-camping bill, seems obsessed with the genitals of occupiers. In October Watson said he saw some members engage in a sex act outside his office, which allegedly triggered the police infiltration. (An unnamed legislative aide also claimed witnessing an “orgy going on out on the plaza.”)

During recent hearings before the House Judiciary Committee, which Watson chairs, he bellowed indignantly that an occupier “peed on” a secretary taking a cigarette break. His solution: “If you approve of that and you think that’s peaceable assembly, you need to be peed on.”

Custer responds, “We know that Homeland Security is out there and we have been told by state police that they are photographing and recording us. If someone was breaking the law so blatantly then they should have been arrested.”

It was during those judiciary committee hearings that the one-year jail time was added for anyone maintaining “living quarters on publicly owned property” where residency is not allowed. To get rid of the Occupy movement, the state is taking a sledgehammer approach by also effectively criminalizing homelessness.

Occupy Nashville is almost certain to challenge the law in court once it passes. Like their compatriots in Boise, they hope to block implementation of the law or even have it overturned. In a perverse manner, the laws are a sign of success of the Occupy movement. Novelist Arundhati Roy told me that she doesn’t think “the state will allow people to occupy a particular space unless it feels that allowing that will end up in a kind of complacency, and the effectiveness and urgency of the protest will be lost.”

That urgency will be on display repeatedly this year. On May Day. In Chicago during the G-8 and NATO summits. In Tampa Bay, Fla., for the Republican National Convention and Charlotte for the Democrats. And in ways no one can predict. In each instance the confrontation will come down to a question of power. The government will deploy all the ideological, policing and legal power at its disposal. On the other side, the Occupy movement has the power of a unifying idea and social legitimacy. It’s a lopsided battle, but no one could have ever imagined that the Occupy Wall Street movement could have come this far already.

: Arun Gupta, a New York writer and co-founder of Occupy the Wall Street Journal, covers the Occupy movement for Salon. More Arun Gupta
: More Michelle Fawcett

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Unhappy Valentine’s Day in Israel

A racist Israeli law divides married Palestinian couples; Jewish couples are exempt

VIDEO

By Taiseer Khatib

Taiseer Khatib and his wife, Lana

Topics:Israel-Palestine, Valentines Day

This Valentine’s Day, I live in fear of being separated from my wife by the force of the Israeli state and the whim of bureaucrats enforcing a discriminatory law that can separate Palestinian citizens of Israel from Palestinian spouses from the occupied West Bank. This fear will hang over us for years if the “Citizenship and Entry Into Israel Law” is not revoked as the state can use this law to separate me from my family.

Lana, my wife, is from Jenin in the Occupied Palestinian Territories. She has a diploma in economics from Al-Najah University in Nablus. We met and fell in love in Jenin in late 2002 after Israel’s destruction of the Jenin refugee camp during the second intifada. She moved to Israel in 2005 to live with me. We now have two children, Adnan, who is 4 and a half years old and Yosra, who is 3 and a half years old. My family means the world to me and yet our standing in Israel is extremely tenuous because of my ongoing failed effort to secure citizenship for my wife.

Despite the might of the Israeli government arrayed against us, Lana and I persevere because love is a force far more powerful than the state. No matter the government responsible for repression, whether in apartheid South Africa, the Jim Crow South, or elsewhere, love has always been more powerful. We knew the risks when we married after the law passed in 2003. But we were determined not to allow an apartheid state that discriminates against Palestinians on both sides of the Green Line to disrupt our love.

Lana’s residency has so far been possible only through yearly extensions of her permission to stay in Israel. Yet these have been entirely subject to the arbitrary discretion of Israel’s Interior Ministry and its security services. She has no legal or social rights, nor the possibility of obtaining health insurance or social security. She is not allowed to hold a job or drive a car. She is, by any fair reckoning, a third-class resident of Israel.

Lana used to be an independent woman – having worked for four years in the Palestinian Ministry of Health in Jenin – but today, in “modern” Israel, she is now totally dependent on me. Our home, rather than a haven, has become her prison. She is stuck and there is no immediate prospect of release. This situation causes her and us permanent frustration. “I feel my freedom was stolen from me by this racist law,” she says. “It doesn’t matter where you live, you are always controlled and denied rights by the state of Israel, [merely] because I am Palestinian.”

We are not alone. There are tens of thousands of other Palestinian families targeted by the so-called Citizenship Law. Originally promulgated in 2003, it prohibits Palestinians without Israeli citizenship from joining their spouses in Israel or seeking eventual rights of residence. There is no comparable prohibition against family unification for non-Palestinian citizens of Israel, i.e., the country’s present-day Jewish majority.

The law explicitly discriminates on the basis of race. Notwithstanding this fact, the Israeli Supreme Court of Justice earlier this year rejected a final appeal against the law. As a result, my wife could well be denied the right to live with me, a Palestinian with Israeli citizenship, and our two children in my hometown of Akka.

As many as 30,000 Palestinian-Israeli families (approximately 130,000 individuals) are under a similar threat of separation. On either side of Israel’s unilateral line of separation, many are already living apart from their spouses and children. They have no voice in Israel and face a Supreme Court that seems to think allowing them into Israel, and upholding human rights, is akin to “national suicide.” Israel’s nonstop security emphasis has turned all members of its Palestinian minority – and their spouses – into would-be security threats. Of course, settlers who have repeatedly employed violence from Gaza (prior to September 2005) to the West Bank to Israel face no similar restrictions on their married lives. Violence against Palestinians counts very differently in Israel.

The recent Israeli Supreme Court decision means that Lana can no longer hope, however tenuously, to acquire citizenship, or even permanent residency. In the best case, she might obtain further extensions of her present status. Meanwhile, the threat of those extensions being suspended will hang all the more ominously over us. Each time we go to the Interior Ministry to renew her permission, and each time Lana goes to renew her permission from the Israeli military administration near Jenin, we face the possibility of being told the permit will not be renewed due to security reasons or some other excuse. It is a dreadful climate in which to raise a family. There is no certainty and stress pervades our lives.

The would-be harmony of family life is further disrupted by the fact that we cannot choose to live in Jenin. According to laws introduced after the 1993 Oslo Accords, Israeli citizens are not allowed to live in or even visit Palestinian cities in Palestinian Authority-administered areas of the Occupied Territories. We, and tens of thousands of our compatriots, are caught in a truly Kafkaesque dilemma. The fear of being torn apart as a family has become a daily part of our lives.

While many of us have since childhood suffered discrimination, dispossession and violence at the hands of the Israeli state, and have watched with dismay as the international community fails to hear and address the difficulties of Israel’s non-Jewish minority, we see the new “Citizenship Law” as marking a particularly ominous regression for Israeli society. It is clear, and explicitly acknowledged in the Israeli public arena, that the purpose of this law is to further compound the difficulties confronting the country’s Palestinian minority, to make that community ever less viable, and ultimately to secure an Israel empty of Palestinians. In recent years, and especially in this current Knesset, more that 25 laws and law proposals were passed or advanced that discriminate against Palestinian citizens of Israel. Many Palestinians affected are convinced that the law aims to make life so unbearable for families that they will permanently leave Israel.

Foreign Minister Avigdor Lieberman, who met last week with Secretary of State Hillary Clinton, is a proponent of the legislation. So far as I know, Secretary Clinton said not one word to him on behalf of the Palestinian families negatively affected by the “Citizenship Law” Lieberman touts. Thanks to the American silence, the United States abdicates its position as self-described “leader of the free world.”

Lieberman, who is a staunch advocate for the ethnic transfer of Palestinians out of Israel, regularly employs language that reminds Israel’s Palestinian population of the climate of violence in which our parents and grandparents were evicted from their homes in 1948, while those who remained were reduced to clear minority status. In fact, the “Citizenship Law” has been forced upon us by a Supreme Court put in place by an Israeli democracy that holds hegemony only because over 700,000 Palestinians were expelled and never allowed to return at the time of Israel’s creation in 1948. Such is the reality of the Middle East’s self-proclaimed “only democracy.” It is a democracy built on ethnic cleansing that to this day is pulling apart Palestinian families from either side of the Green Line. Meanwhile, Jewish couples from inside Israel and the illegal settlements of the West Bank face no such fears.

This Valentine’s Day I hold little hope for a steady and certain future with my wife and children. Even venturing to share our situation – and that of thousands of other couples – endangers my family by exposing us to the whim of that faceless bureaucrat who may consequently be leaned on by an elected official unhappy that Israel is being exposed for its discriminatory laws.

This is a far cry from the Israel that Prime Minister Netanyahu described last year to Congress. In his make-believe Israel, the one delightedly indulged by an out-of-touch Congress, Palestinians enjoy full rights equal to those of Jewish Israelis. This is a lie as the state’s discrimination against me and my family attests.

The United States has some experience with such laws through its own miscegenation laws of previous decades. That American racism was best addressed by the civil rights movement and its success in guaranteeing equality for all citizens without regard to their race, religion or ethnicity. On Valentine’s Day it is long past time for Israel to address its own racism by promulgating similar laws that will promote the legal equality of Palestinians and Jews alike.

: Taiseer Khatib is a Ph.D student in Anthropology at the University of Haifa and a teacher at Western Galilee College in northern Israel, Taiseer's story is part of a series called 'Love Under Apartheid' and available at www.loveunderapartheid.com. More Taiseer Khatib