Michael Moore Comments on the Financial Condition of the New GM ...and why "We Have to Re-Engineer American Civilization."

MIKE & FRIEND'S BLOG

Michael Moore is an Academy-Award winning filmmaker and best-selling author

August 13th, 2010 2:10 PM

Profits Up at GM! And You're Still Unemployed

By Michael Moore

So General Motors is back to making billions in profit. And if the past is any guide, we know what that means: time for some layoffs!

Or maybe not. Back in the '80s and '90s, when GM was consistently posting giant profits, they were simultaneously firing tens of thousands of workers in my hometown of Flint and across Michigan. Right now it looks like the only person being canned is CEO Edward Whitacre. (Only last week Whitacre was saying he wasn't planning to leave anytime soon—kind of ironic that the former president of the Boy Scouts of America failed to Be Prepared.)

But if they're not laying people off yet, they're also not hiring.

During the first half of 2010, GM made $2.2 billion in profit, yet according to The Wall Street Journal, they've only added 2,000 jobs in all of North America, taking their workforce from 113,000 to 115,000.

And what's true for GM is true for the country. The government stepped in with trillions of dollars in cash and guarantees to keep Corporate America from collapsing due to its own stupidity, short-sightedness and greed.

And it worked—for Corporate America. You may not have noticed as you were being foreclosed on, but the profitability of the Fortune 500 is almost back to normal. It jumped to $391 billion in 2009, up 335 percent from 2008. And the 500 biggest non-financial corporations are now sitting on $1.8 trillion in cash, more than at any time in the past 50 years. (That's what the business press always says—that they're "sitting" on it—although as far as I know this is not literally true.)

That's what we should really focus on when talking about GM and other companies who've taken the free handout. It's not about the continuous reshuffling of the white-guys-in-suits deck of cards. What does it mean that the new CEO of GM is Daniel F. Akerson, a managing director at the Carlyle Group? Probably that GM is about to be run by some real ballbusters who have no problem flaunting the law or basic American decency.

To understand what's happening, we have to focus on the bottom line, just like they do. And what the bottom line says is that the entire business world has figured out how to make huge buckets of money without hiring us to work for them. I'm not sure how in the long run this benefits these companies. Maybe the same robots who make most things now are also programmed to buy them?

But the upshot is this: We have to face the fact that most of America's CEOs don't want the economy to get "better." Because for them, it couldn't get better—they've got profit coming out their ears, while with 9.5 percent unemployment their entire workforce is too scared to ask for a 25 cent-an-hour raise. They'd be happy to have things stay just like they are now. Forever.

But as bad as the bad news is, the good news is better. Millions more people now realize that we need a new New Deal. We have to re-engineer American civilization, and it's going to take a lot of people.

Did you know Portugal now gets 45 percent of its electricity from renewable sources—up from 17 percent just five years ago? Or that Scientific American found we could eliminate all fossil fuel usage by 2030? Or that high altitude wind could by itself provide 100 times the energy now used by the entire world? And best of all, we can afford to make the change—we're rich! Remember that $1.8 trillion in our corporate bank accounts? Yet while the rest of the world is heading off to the future, we're just sitting here. The only thing that will work to get us there is what's worked before: just like we did in the '30s and '60s, we have to stop being scared of the top 1 percent, and make them scared of us. That's the only way they'll relax the death grip they have on this country long enough to let us save ourselves and them.

One thing is certain: Obama won't do this for us. Congress? Forget it.

If we want a life worth living for ourselves and our kids, we have to go get it ourselves. We can’t keep waiting for the cavalry to come. That’s because we’re the cavalry.

And from the top floor of the GM tower in downtown Detroit, they should hear our hoofprints a-comin'.

Ben Bernanke Then and Now: Paul Krugman recalls Benrnanke's stinging criticism of the Bank of Japan ten years ago for not taking forceful action to revive a deeply depressed economy and wonders why as head of the Fed he is not now taking his own advice, given that the U.S. is "in worse shape now than Japan was in 2000."

August 12, 2010

Paralysis at the Fed

By PAUL KRUGMAN

Ten years ago, one of America’s leading economists delivered a stinging critique of the Bank of Japan, Japan’s equivalent of the Federal Reserve, titled “Japanese Monetary Policy: A Case of Self-Induced Paralysis?” With only a few changes in wording, the critique applies to the Fed today.

At the time, the Bank of Japan faced a situation broadly similar to that facing the Fed now. The economy was deeply depressed and showed few signs of improvement, and one might have expected the bank to take forceful action. But short-term interest rates — the usual tool of monetary policy — were near zero and could go no lower. And the Bank of Japan used that fact as an excuse to do no more.

That was malfeasance, declared the eminent U.S. economist: “Far from being powerless, the Bank of Japan could achieve a great deal if it were willing to abandon its excessive caution and its defensive response to criticism.” He rebuked officials hiding “behind minor institutional or technical difficulties in order to avoid taking action.”

Who was that tough-talking economist? Ben Bernanke, now the chairman of the Federal Reserve. So why is the Bernanke Fed being just as passive now as the Bank of Japan was a decade ago?

Now, America’s current economic troubles aren’t exactly identical to those of Japan in 1999-2000: Japan was experiencing outright deflation, while we aren’t — yet. But inflation is well below the Fed’s target of around 2 percent, and it is continuing to slide. And Americans face a level of unemployment, and sheer human misery, far worse than anything Japan went through.

Yet the Fed is doing almost nothing to confront these troubles.

What could the Fed be doing? Back when, Mr. Bernanke suggested, among other things, that the Bank of Japan could get traction by buying large quantities of “nonstandard” assets — that is, assets other than the short-term government debt central banks normally hold. The Fed actually put that idea into practice during the most acute phase of the financial crisis, acquiring, in particular, large amounts of mortgage-backed securities. However, it stopped those purchases in March.

Since then, the economic news has grown steadily worse. And earlier this week, the Fed changed course — but barely. It now says that it will reinvest the proceeds from maturing securities in long-term government bonds. That’s a trivial change, basically the least the Fed could get away with without facing a firestorm of criticism — and far short of the major asset-purchase program the Fed should be undertaking.

Back in 2000, Mr. Bernanke also suggested that the Bank of Japan could move expectations by making announcements about its future policies. In particular, he argued that it could make private-sector borrowing more attractive by announcing that it would keep interest rates low until deflation had given way to 3 percent or 4 percent inflation — an idea originally suggested by yours truly. Since we are, if anything, in worse shape now than Japan was in 2000, an inflation target of at least 3 percent would very much be in America’s interest. But as chairman of the Fed, Mr. Bernanke has explicitly rejected any such move.

What’s going on here? Has Mr. Bernanke been intellectually assimilated by the Fed Borg? I prefer to believe that he’s being political, unwilling to engage in open confrontation with other Fed officials — especially those regional Fed presidents who fear inflation, even with deflation the clear and present danger, and are evidently unmoved by the plight of the unemployed.

And in fairness to Mr. Bernanke, discord among senior officials also makes it difficult for policy to change expectations: it would be hard to credibly commit to higher inflation if this commitment were constantly being undercut by speeches out of the Richmond or Dallas Feds. In fact, I’d argue that loose talk by some Fed officials is already having a negative economic impact. But while Mr. Bernanke doesn’t have the authority to stop that loose talk, he could make it clear that it doesn’t represent overall Fed policy.

Last, but not least, policy is suffering from an act of neglect by President Obama, who waited until his 16th month in office before offering a full slate of nominees to fill vacancies on the Federal Reserve Board. If he had filled those slots quickly — his nominees still aren’t in place — the Fed might be less passive.

But whatever the reasons, the fact is that the Fed — which is required by statute to promote “maximum employment” — isn’t doing its job. Instead, like the rest of Washington, it’s inventing reasons to dither in the face of mass unemployment. And while the Fed sits there in its self-inflicted paralysis, millions of Americans are losing their jobs, their homes and their hopes for the future. [emphasis added]

My blog yesterday treated civilian employment and the civilian labor force. Today Robert Reich hones in on employment in the OTHER force.

Defense Secretary Robert Gates says he wants to stop production of the C-17 cargo aircraft, because we already have enough of them. Fat chance the Congress will go along.

America’s Biggest Jobs Program — the U.S. Military

Wednesday, August 11, 2010

America’s biggest — and only major — jobs program is the U.S. military.

Over 1,400,000 Americans are now on active duty; another 833,000 are in the reserves, many full time. Another 1,600,000 Americans work in companies that supply the military with everything from weapons to utensils. (I’m not even including all the foreign contractors employing non-US citizens.)

If we didn’t have this giant military jobs program, the U.S. unemployment rate would be over 11.5 percent today instead of 9.5 percent.

And without our military jobs program personal incomes would be dropping faster. The Commerce Department reported Monday the only major metro areas where both net earnings and personal incomes rose last year were San Antonio, Texas, Virginia Beach, Virginia, and Washington, D.C. — because all three have high concentrations of military and federal jobs.

This isn’t an argument for more military spending. Just the opposite. Having a giant undercover military jobs program is an insane way to keep Americans employed. It creates jobs we don’t need but we keep anyway because there’s no honest alternative. We don’t have an overt jobs program based on what’s really needed.

For example, when Defense Secretary Robert Gates announced Monday his plan to cut spending on military contractors by more than a quarter over three years, congressional leaders balked. Military contractors are major sources of jobs back in members’ states and districts. California’s Howard P. “Buck” McKeon, the top Republican on the House Armed Services Committee, demanded that the move “not weaken the nation’s defense.” That’s congress-speak for “over my dead body.”

Gates simultaneously announced closing the Joint Force Command in Norfolk, Virginia, that employs 6,324 people and relies on 3,300 private contractors. This prompted Virginia Democratic Senator Jim Webb, a member of the Senate Armed Services Committee, to warn that the closure “would be a step backward.” Translated: “No chance in hell.”

Gates can’t even end useless weapons programs. That’s because they’re covert jobs programs that employ thousands.

He wants to stop production of the C-17 cargo jet he says is no longer needed. But it keeps 4,000 people working at Boeing’s Long Beach assembly plant and 30,000 others at Boeing suppliers strategically located in 40 states. So despite Gates’s protests the Senate has approved ten new orders.

That’s still not enough to keep all those C-17 workers employed, so the Pentagon and Boeing have been hunting for foreign purchasers. The Indian Air Force is now negotiating to buy ten, and talks are underway with several other nations, including Oman and Saudi Arabia.

Ever wonder why military equipment is one of America’s biggest exports? It’s our giant military jobs program in action.

Gates has also been trying to stop production of a duplicate engine for the F-35 joint Strike Fighter jet. He says it isn’t needed and doesn’t justify the $2.9 billion slated merely to develop it.

But the unnecessary duplicate engine would bring thousands of jobs to Indiana and Ohio. Cunningly, its potential manufacturers Rolls-Royce and General Electric created a media blitz (mostly aimed at Washington, D.C. where lawmakers wold see it) featuring an engine worker wearing a “Support Our Troops” T-shirt and arguing the duplicate engine will create 4,000 American jobs. Presto. Despite a veto threat from the White House, a House panel has just approved funding the duplicate.

By the way, Gates isn’t trying to cut the overall Pentagon budget. He just wants to trim certain programs to make room for more military spending with a higher priority.

The Pentagon’s budget — and its giant undercover jobs program — keeps expanding. The President has asked Congress to hike total defense spending next year 2.2 percent, to $708 billion. That’s 6.1 percent higher than peak defense spending during the Bush administration.

This sum doesn’t even include Homeland Security, Veterans Affairs, nuclear weapons management, and intelligence. Add these, and next year’s national security budget totals about $950 billion.

That’s a major chunk of the entire federal budget. But most deficit hawks don’t dare cut it. National security is sacrosanct.

Yet what’s really sacrosanct is the giant jobs program that’s justified by national security. National security is a cover for job security.

This is nuts.

Wouldn’t it be better to have a jobs program that created things we really need — like light-rail trains, better school facilities, public parks, water and sewer systems, and non-carbon energy sources — than things we don’t, like obsolete weapons systems?

Historically some of America’s biggest jobs programs that were critical to the nation’s future have been justified by national defense, although they’ve borne almost no relation to it. The National Defense Education Act of the late 1950s trained a generation of math and science teachers. The National Defense Highway Act created millions of construction jobs turning the nation’s two-lane highways into four- and six-lane Interstates.

Maybe this is the way to convince Republicans and blue-dog Democrats to spend more federal dollars putting Americans back, and working on things we genuinely need: Call it the National Defense Full Employment Act.

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Robert Reich is Professor of Public Policy at the University of California at Berkeley. He has served in three national administrations, most recently as secretary of labor under President Bill Clinton. He has written twelve books, including The Work of Nations, Locked in the Cabinet, and his most recent book, Supercapitalism. His "Marketplace" commentaries can be found on publicradio.com and iTunes.

Graphic Views of the U.S. Unemployment Situation

The graph above was devised by me, using the latest Bureau of Labor Statistics (BLS) "Household Survey Data" through July 2010. The lower data points (squares) represent the total age-16-and-above civilian non-farm payroll employment, while the upper data (circles) represent the total civilian age-16-and-above labor force, defined as all those employed either full or part time plus those out of work who searched for jobs in the 4 weeks preceding the survey.  Thus, those "officially" regarded as unemployed are those lying between the circles and the squares (highlighted by the photograph).

The BLS also reports 2.6 million persons in the "marginally attached labor force," who wanted work and looked for a job in the past 12 months but did not search for one within the past 4 weeks. Clearly they belong above the circles in this graph.

You will notice that the labor force (circles) has tended to flatten out since early 2007 ...and also the fact that I have continued the "unemployed" photograph beyond 2007 as a sort of triangle sloping upward above the circles toward the upper-right corner.  Well, I selected the slope of this triangle to represent U.S. population growth, which is not precisely known but has been most commonly quoted as about 150,000 per month (the exact number I used, although Bob Herbert in his column that I reposted yesterday states "the labor force increases by roughly 150,000 to 200,000 people per month").  These numbers can be compared with the birth rates of those who turned 16 in the past 3 years, about 333,000 per month, and the overall U.S. death rate of about 250,000 per month, which is heavily weighted toward retired persons and thus would not diminish the labor force nearly as fast as the young persons augment it.  In any event, the average slope of the BLS-determined work force from 2001 to January 2007 corresponds to about 147,000 workers added to the labor force per month.

Subtraction of the 2.6 million "marginally attached labor force" from the top of the triangle at the right leaves an additional 3.8 million Americans likely wanting work but having totally given up for at least one year.  Adding the entire 6.4 million difference between the right-most circle and the top-right-most corner of my "triangle" to the 14.6 million Americans "officially" unemployed in July 2010 gives a more realistic figure of 21 million Americans out of work and a corresponding unemployment rate of 13%.

The video below shows the evolution of U.S. unemployment from January 2007 through September 2009 (the dark gray areas on the map represent 10.0% or higher unemployment).

Bob Herbert: "The U.S. will not remain a stable society if this great employment crisis is not addressed head-on — and soon. You cannot allow joblessness on this scale to fester. It’s wrong, and the blowback will be as destructive and intolerable as it is inevitable."

OP-ED COLUMNIST

The Horror Show

By BOB HERBERT
Published August 9, 2010


The employment situation in the United States is much worse than even the dismal numbers from last week’s jobless report would indicate. The nation is facing a full-blown employment crisis and policy makers are not responding with anything like the sense of urgency that is needed.

The employment data for July, released by the government on Friday, showed that private employers added just 71,000 jobs during the month and that the unemployment rate remained flat at 9.5 percent. But as bad as those numbers were, if you look beyond them you’ll see a horror show.

Government workers were walking the plank from coast to coast. About 143,000 temporary Census workers were let go, and another 48,000 government employees at the budget-strapped state and local levels lost their jobs. But the worst news, with the most ominous long-term implications, was that the reason the unemployment rate was not higher was because 181,000 workers left the labor force.

With many of them beaten down by the worst jobs situation since the Great Depression, they just stopped looking for work. And given the Alice-in-Wonderland way in which we compile our official jobless statistics, they are no longer counted as unemployed.

Charles McMillion, the president and chief economist of MBG Information Services in Washington, is an expert on employment and has been looking closely for years at the issue of labor force participation. “Over the past three months,” he said, “1,155,000 unemployed people dropped out of the active labor force and were not counted as unemployed. Even ignoring population growth, if these unemployed had not dropped out of the labor force, simple arithmetic shows that the official unemployment rate would have risen from 9.9 percent in April to 10.2 percent in July, rather than — as it has — fallen to 9.5 percent.”

Because of normal growth in the working-age population, the labor force increases by roughly 150,000 to 200,000 people per month. If those folks were factored in, said Mr. McMillion, “unemployment now would be even higher than 10.2 percent.”

We are not even beginning to cope with this crisis, which began long before the onset of the so-called Great Recession. The economy is showing absolutely no sign of countering the nation’s staggering jobs deficit.

“We have a large number of people who have just given up hope of finding a job,” said Mr. McMillion. He pointed out that there are record numbers — “I mean lights-out record numbers” — of long-term unemployed people who are still looking for jobs. Of the 14.6 million men and women officially counted as unemployed, nearly 45 percent have been out of work for six months or longer.

The Times’s Michael Luo wrote a moving article last week about the people who have started calling themselves the “99ers,” meaning they have been out of work for more than 99 weeks and thus have exhausted the absolute maximum in unemployment benefits. Nearly a million and a half people have been out of work for at least 99 weeks — and not all of them qualified for jobless benefits.

Said Mr. McMillion: “When you combine the long-term unemployed with those who are dropping out and those who are working part-time because they can’t find anything else, it is just far beyond anything we’ve seen in the job market since the 1930s.”

They may be thinking about this in Washington, but they sure aren’t doing much about it. The politicians’ approach to the jobs crisis has been like passing out umbrellas in a hurricane. Millions are suffering and the entire economy is being undermined, and what are they doing? They’re appropriating more and more money for warfare while schizophrenically babbling about balancing the budget.

At some point we’re going to have to claw our way out of this denial. With 14.6 million people officially jobless, and 5.9 million who have stopped looking but say they want a job, and 8.5 million who are working part time but would like to work full time, you end up with nearly 30 million Americans who cannot find the work they want and desperately need.

We’ve got more and more people in our working-age population and fewer and fewer jobs to go around. Mr. McMillion tells us that there are now 3.4 million fewer private-sector jobs in the U.S. than there were a decade ago. In the last 10 years, we’ve seen the worst job creation record since 1928 to 1938.

We’re not heading toward the danger zone. We’re there. The U.S. will not remain a stable society if this great employment crisis is not addressed head-on — and soon. You cannot allow joblessness on this scale to fester. It’s wrong, and the blowback will be as destructive and intolerable as it is inevitable.

Bomb the enemy "back into the stone age": Familiar military hubris befitting the Federal Government's evident intention to financially squeeze the 50 states back into the stone age.

Natalie Bartling stands beneath the streetlight she petitioned to have put on her residential street five years ago in the city of Colorado Springs.

August 8, 2010

America Goes Dark

By PAUL KRUGMAN

The lights are going out all over America — literally. Colorado Springs has made headlines with its desperate attempt to save money by turning off a third of its streetlights, but similar things are either happening or being contemplated across the nation, from Philadelphia to Fresno.

Meanwhile, a country that once amazed the world with its visionary investments in transportation, from the Erie Canal to the Interstate Highway System, is now in the process of unpaving itself: in a number of states, local governments are breaking up roads they can no longer afford to maintain, and returning them to gravel.

And a nation that once prized education — that was among the first to provide basic schooling to all its children — is now cutting back. Teachers are being laid off; programs are being canceled; in Hawaii, the school year itself is being drastically shortened. And all signs point to even more cuts ahead.

We’re told that we have no choice, that basic government functions — essential services that have been provided for generations — are no longer affordable. And it’s true that state and local governments, hit hard by the recession, are cash-strapped. But they wouldn’t be quite as cash-strapped if their politicians were willing to consider at least some tax increases.

And the federal government, which can sell inflation-protected long-term bonds at an interest rate of only 1.04 percent, isn’t cash-strapped at all. It could and should be offering aid to local governments, to protect the future of our infrastructure and our children.  [Blogger's emphasis]

But Washington is providing only a trickle of help, and even that grudgingly. We must place priority on reducing the deficit, say Republicans and “centrist” Democrats. And then, virtually in the next breath, they declare that we must preserve tax cuts for the very affluent, at a budget cost of $700 billion over the next decade.

In effect, a large part of our political class is showing its priorities: given the choice between asking the richest 2 percent or so of Americans to go back to paying the tax rates they paid during the Clinton-era boom, or allowing the nation’s foundations to crumble — literally in the case of roads, figuratively in the case of education — they’re choosing the latter.

It’s a disastrous choice in both the short run and the long run.

In the short run, those state and local cutbacks are a major drag on the economy, perpetuating devastatingly high unemployment.

It’s crucial to keep state and local government in mind when you hear people ranting about runaway government spending under President Obama. Yes, the federal government is spending more, although not as much as you might think. But state and local governments are cutting back. And if you add them together, it turns out that the only big spending increases have been in safety-net programs like unemployment insurance, which have soared in cost thanks to the severity of the slump.

That is, for all the talk of a failed stimulus, if you look at government spending as a whole you see hardly any stimulus at all. And with federal spending now trailing off, while big state and local cutbacks continue, we’re going into reverse.

But isn’t keeping taxes for the affluent low also a form of stimulus? Not so you’d notice. When we save a schoolteacher’s job, that unambiguously aids employment; when we give millionaires more money instead, there’s a good chance that most of that money will just sit idle.

And what about the economy’s future? Everything we know about economic growth says that a well-educated population and high-quality infrastructure are crucial. Emerging nations are making huge efforts to upgrade their roads, their ports and their schools. Yet in America we’re going backward.

How did we get to this point? It’s the logical consequence of three decades of antigovernment rhetoric, rhetoric that has convinced many voters that a dollar collected in taxes is always a dollar wasted, that the public sector can’t do anything right.

The antigovernment campaign has always been phrased in terms of opposition to waste and fraud — to checks sent to welfare queens driving Cadillacs, to vast armies of bureaucrats uselessly pushing paper around. But those were myths, of course; there was never remotely as much waste and fraud as the right claimed. And now that the campaign has reached fruition, we’re seeing what was actually in the firing line: services that everyone except the very rich need, services that government must provide or nobody will, like lighted streets, drivable roads and decent schooling for the public as a whole.

So the end result of the long campaign against government is that we’ve taken a disastrously wrong turn. America is now on the unlit, unpaved road to nowhere.

Questioning how the US can lock up more people per capita than any other country in the world and how California can rank 50th among the states in education spending while "we can afford to put people in prison for the rest of their lives for stealing socks."

Fast 4 Freedom

by Diane Lefer posted on Monday, 9 August 2010

Three Strikes and the Prison Industrial Complex

“We’re fasting for freedom,” proclaimed Geri Silva, “because we’re starving for justice.” Silva, founder of FACTS, Families to Amend California’s Three Strikes–the law that mandates life sentences for a third conviction, even if minor and nonviolent, stood on Spring Street Friday morning in front of the downtown Los Angeles offices of Governor Schwarzenegger, Senate President Pro Tem Darrell Steinberg, and Assembly Speaker John Perez. About two dozen activists and onlookers gathered there in solidarity with inmates who were fasting in 33 California State prisons while coordinated protests occurred in front of State government offices in Fresno, Indio, Sacramento and San Francisco. With chants of “Prisons for profit, You know you gotta stop it!”, and personal testimonies from families and friends of the incarcerated, protestors sought to raise public–and State officeholder–awareness of the dysfunctional prison system and the impact of unrestrained prison spending on the State budget.

David Chavez of Critical Resistance, a prison abolition organization, questioned how the US can lock up more people per capita than any other country in the world and how California can rank 50th among the states in education spending while “we can afford to put people in prison for the rest of their lives for stealing socks.”

And while the notion of Three Strikes sounds as though it will be applied to violent criminals who are habitual offenders, committing crime after crime, mothers and wives of incarcerated men stepped forward to tell about the common practice by which district attorneys charge more than one strike for a single incident.

graduation not incarcerationAmy York, social worker and sentencing advocate, spoke on behalf of incarcerated youth, many of them first-time offenders sentenced to life in prison for gun crimes in which no one died and in which they did not pull the trigger. “They have no adult rights,” she pointed out. “They are not considered adults for any purpose other than sentencing.” She told of Steven Menendez, arrested at age 14. “He’ll turn 18 on Sunday. He has grown up in the youth facility, a model prisoner.” He should be going to college, she said. Instead, he’ll now be transferred to an adult prison to serve life behind bars. “It breaks my heart that he’s not being given a second chance.”

California taxpayers, we learned, pay $7,500 for a young person in school. We pay about $50,000 a year for each prisoner. While, as representatives of CURB — Californians United for a Responsible Budget — pointed out, the State legislature, without taxpayer input or approval, passed AB900 to fund new prison construction with $7.3 billion in lease revenue bonds and $350 million from the State’s general fund. But if California complied with the federal order to decrease the prison population by 44,000 inmates instead of funding more prison beds, the $2.5 billion in savings could instead fund programs needed to restore quality of life in California.

AB900 was a huge victory for the prison-industrial complex. “People are making a profit out of putting people in cages,” said Geri Silva. Some of the money is earmarked for special prison facilities for elderly, disabled, and terminally ill inmates who could easily be released with no danger to the public. After debt service on the bonds, CURB estimates the cost to Californians at $15 billion at a time of high unemployment and when necessary services–including the education, job training, and mental health support that could keep people out of trouble–are being cut to the bone. One mother, who acknowledged her son had done wrong, said he’d stupidly believed he could help the family by committing a robbery after both he and she lost their jobs due to the economic downturn and were left without income.

It is hard to envision prison population reduction, however, as long as extreme sentences remain the norm and the Board of Prison Terms has an automatic default position in 90-95% of cases when it comes to parole: Denied. Of the lucky few who get approved by the Board, close to 100% have had the decision overruled by Governor Schwarzenegger. And because the Board requires expressions of remorse, there’s no possibility of parole for people who have been wrongfully convicted and maintain their innocence.

“Ten percent of the prison population,” says Silva, citing Gloria Killian as her source. Killian served 16 years in prison before she was exonerated after being convicted of murder in a case notorious for perjured testimony and prosecutorial misconduct. Now as executive director of the Action Committee for Women in Prison she continues the work she began behind bars, winning freedom for women prisoners.

Larry Vanderberg is one of the wrongfully convicted, says his wife, Teri. During a vacation in Palm Springs, in full view of her and of a number of children, Larry–a special ed teacher–tossed the daughter of a family friend into the swimming pool. Later, the child told her mother she thought he’d touched her “pipi” when he lifted her. Teri Vanderberg says the overzealous D.A.’s office in Riverside proceeded to have the little girl and other children questioned, using the kind of coaching and witch hunt tactics discredited by the travesties of justice in the infamous McMartin preschool case and the Bakersfield satanic abuse cases.

Now fathers tell her they know better than to spend any time around their daughters’ friends. In a society where we know children need male role models and father figures, she fears we are encouraging dads to remain aloof and uninvolved. ”I wasn’t an activist before this,” she explains. “We were just a middle class family raising kids in Temecula Valley. Now I’ve met people all around the country who are going through the same thing. As long as any child can say ‘I’ve been touched,’ this could happen to anyone. But you have no idea until it happens to you. It’s like being hit by a truck.”

In prison her husband met another teacher whose conviction was overturned when it became clear that the little girl who’d agreed with prosecutors that he’d touched her vagina had believed “vagina” was a fancy grownup word for “elbow.” By then, the man had served five years in prison and his family was destitute. They lost their home and he is still fighting to regain his teaching credential.

As for Larry Vanderberg, even if you choose to believe he is guilty as charged, that his hand slid between the little girl’s legs as he lifted her into the air, does it make sense that convicted rapists serve eight years and go home when Vanderberg got a life sentence?

Teri Vanderberg’s father has cashed in the equity in his house and her church is holding fundraisers to help pay legal bills for her husband’s appeal. In the meantime, in prison he was diagnosed with Stage IV cancer. In spite of his wife’s constant, unwavering advocacy, Larry Vanderberg still waits for medically necessary follow-up care while his youngest daughter–now a teenager–writes to him, talks to him on the phone, and makes public statements on his behalf but because he’s not allowed any contact with minors, she is barred by the State from visiting him.

“The people who run the State are far removed from the pain and suffering,” said Silva. “The only pain they have is when they get annoyed because here we are again.”

And Molly Bell, describing herself as “straight out of Compton,” explained why she was present and fasting even though “it’s not my husband. It’s not my son. But somebody has to stand in the gap for those who cannot stand here.”

Diane Lefer

Diane Lefer’s new book, The Blessing Next to the Wound, has just been published. Co-authored with Hector Aristizábal, it is a true story of surviving torture and civil war and seeking change (including change in how we treat our youth) through action.