Why The SEC Hasn’t Moved Against Financial Institutions

The Article: In defense of the SEC– no, really by Finance Addict.

The Text: “’We do not admit the allegations,’ Karp said, to laughter in the standing-room-only courtroom. ‘But if it’s any consolation, we don’t deny them.’”

Some consolation. This statement was made last week by a lawyer that Citigroup hired to defend itself against SEC allegations of fraud. The SEC maintains that Citi stuffed a CDO with mortgages that it knew would go bad, sold the CDO to investors without revealing the extent of its role and then set up a $500 million trade for itself that would pay off once the expected losses occurred. The CDO investors eventually lost $700 million. But rather than taking Citi to trial, the SEC would prefer to settle the case for $285 million and assurances that Citi won’t do it again.

The SEC is being forced by New York federal judge Jed Rakoff to defend this approach. While judges typically rubberstamp these settlements, Rakoff has a reputation for putting the SEC on the hot seat. His pointed questions highlight the abysmal job that the SEC has done in holding serial offenders to account. Why doesn’t the SEC ever go to trial to get to the bottom of its claims? How can justice be done if the offenders never admit wrongdoing? According to BusinessWeek:

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Understanding Iran

The Article: If you lived in Iran, wouldn’t you want the nuclear bomb? by Mehdi Hasan in the Guardian.

The Text: Imagine, for a moment, that you are an Iranian mullah. Sitting crosslegged on your Persian rug in Tehran, sipping a cup of chai, you glance up at the map of the Middle East on the wall. It is a disturbing image: your country, the Islamic Republic of Iran, is surrounded on all sides by virulent enemies and regional rivals, both nuclear and non-nuclear.

On your eastern border, the United States has 100,000 troops serving in Afghanistan. On your western border, the US has been occupying Iraq since 2003 and plans to retain a small force of military contractors and CIA operatives even after its official withdrawal next month. Pakistan, a nuclear-armed nation, is to the south-east; Turkey, America’s Nato ally, to the north-west; Turkmenistan, which has acted as a refuelling base for US military transport planes since 2002, to the north-east. To the south, across the Persian Gulf, you see a cluster of US client states: Bahrain, home to the US Fifth Fleet; Qatar, host to a forward headquarters of US Central Command; Saudi Arabia, whose king has exhorted America to “attack Iran” and “cut off the head of the snake”.

Then, of course, less than a thousand miles to the west, there is Israel, your mortal enemy, in possession of over a hundred nuclear warheads and with a history of pre-emptive aggression against its opponents.

The map makes it clear: Iran is, literally, encircled by the United States and its allies.

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On The American Educational System

The Article: Against School: How public education cripples our kids, and why by John Taylor Gatto.

The Text: I taught for thirty years in some of the worst schools in Manhattan, and in some of the best, and during that time I became an expert in boredom. Boredom was everywhere in my world, and if you asked the kids, as I often did, why they felt so bored, they always gave the same answers: They said the work was stupid, that it made no sense, that they already knew it. They said they wanted to be doing something real, not just sitting around. They said teachers didn’t seem to know much about their subjects and clearly weren’t interested in learning more. And the kids were right: their teachers were every bit as bored as they were.

Boredom is the common condition of schoolteachers, and anyone who has spent time in a teachers’ lounge can vouch for the low energy, the whining, the dispirited attitudes, to be found there. When asked why they feel bored, the teachers tend to blame the kids, as you might expect. Who wouldn’t get bored teaching students who are rude and interested only in grades? If even that. Of course, teachers are themselves products of the same twelve-year compulsory school programs that so thoroughly bore their students, and as school personnel they are trapped inside structures even more rigid than those imposed upon the children. Who, then, is to blame?

We all are. My grandfather taught me that. One afternoon when I was seven I complained to him of boredom, and he batted me hard on the head. He told me that I was never to use that term in his presence again, that if I was bored it was my fault and no one else’s. The obligation to amuse and instruct myself was entirely my own, and people who didn’t know that were childish people, to be avoided if possible. Certainly not to be trusted. That episode cured me of boredom forever, and here and there over the years I was able to pass on the lesson to some remarkable student. For the most part, however, I found it futile to challenge the official notion that boredom and childishness were the natural state of affairs in the classroom. Often I had to defy custom, and even bend the law, to help kids break out of this trap.

The empire struck back, of course; childish adults regularly conflate opposition with disloyalty. I once returned from a medical leave to discover that all evidence of my having been granted the leave had been purposely destroyed, that my job had been terminated, and that I no longer possessed even a teaching license. After nine months of tormented effort I was able to retrieve the license when a school secretary testified to witnessing the plot unfold. In the meantime my family suffered more than I care to remember. By the time I finally retired in 1991, I had more than enough reason to think of our schools – with their long-term, cell-block-style, forced confinement of both students and teachers – as virtual factories of childishness. Yet I honestly could not see why they had to be that way. My own experience had revealed to me what many other teachers must learn along the way, too, yet keep to themselves for fear of reprisal: if we wanted to we could easily and inexpensively jettison the old, stupid structures and help kids take an education rather than merely receive a schooling. We could encourage the best qualities of youthfulness – curiosity, adventure, resilience, the capacity for surprising insight – simply by being more flexible about time, texts, and tests, by introducing kids to truly competent adults, and by giving each student what autonomy he or she needs in order to take a risk every now and then.

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The Genius Of The Muppets

The Article: The Muppets and Moi by Hadley Freeman in the Guardian.

The Text: Some of us, for the record, have always played the music. And some of us, also just to clarify, never stopped lighting the lights. That’s because, for us in the cultural elite, we are always ready to meet the Muppets on The Muppet Show tonight.

When it was announced on Tuesday that US TV broadcaster NBC has commissioned a script for a new series of the Muppets, the reaction among critics, commentators and tweeters was, frankly, remarkable. It is rare that a four-decades old franchise can announce a return to TV and prompt such unabashed enthusiasm as well as a total lack of cynicism about quality control. Everyone loves the Muppets – that goes without saying. More surprising is how many people want them back, creating, satirising, karate chopping.

The Muppets are definitely having what Miss Piggy would call, with a proud tilt of her snout and a toss of her blonde mane, “un petit moment”. The Muppets, the latest Muppet movie, opens in America this week and magazines across the nation have enthusiastically taken advantage of this to feature the cloth-covered puppets on their covers, in all their anarchic glory.

That film, though, has been slightly gazumped by the extraordinary documentary, Being Elmo, about the man behind possibly the most famous Muppet not on The Muppet Show but on Sesame Street. This beautiful movie has reminded audiences, if any needed reminding, that the Muppets were always more than just clever satirists but an integral part of American culture and society.

When Eddie Murphy dropped out of hosting the Oscars two weeks ago, a campaign was instantly launched for the Muppets to take his place. “Can Muppets Save the Day?” read the headline on the LA Times. “If the position were chosen by popular vote, the beloved Henson creations would likely come out on top,” the journalist concluded. Sadly, the position is not chosen by popular vote and so the hosting duties went to another comedy throwback, Billy Crystal. But if the Muppets don’t at least get to present an award, Miss Piggy should karate-chop Crystal. Hiii-yah!

Here is where I should, really, put the responsible disclaimer: my love for the Muppets is not without personal loyalties. My mother used to work for the Children’s Television Workshop (CTW, now called Sesame Workshop), the non-profit organisation behind various Jim Henson shows. Incidentally, that is the coolest thing about me. It’s all pith from hereon.

She worked on Sesame Street (The Muppet Show was, in fact, produced in England, as all English fans of the show tell me within one minute of first mentioning the programme – that explains the extraordinarily high number of cockney singalongs). Yet it’s fair to say that I grew up in a household predisposed to watch all things Muppet-based. When I think back on my childhood, one of the first tableaux that comes to mind is me, my sister and our parents watching Sunday night screenings of reruns of The Muppet Show. It’s a vision that seems so inspired by a 50s advert for TV sets that I’d doubt it – if my family didn’t have a habit of making Muppet Show references to one another, if not on a daily basis then certainly on a weekly one, from Miss Piggy chasing her “Kermie” around, to the Mahna Mahna song. That Sunday night ritual, with my sister and me laughing at the slapstick gags, my parents laughing at the satirical ones, was as comforting as being tucked into bed later. It was like being told that everything, in the end, would turn out just fine.

But in all professional and personal honesty, I cannot imagine that if my mother had worked on, say, The Magic Roundabout, I’d have loved The Muppet Show any less.

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The Failure Of Elite Education Institutions

The Article: The Disadvantages of an Elite Education: Our best universities have forgotten that the reason they exist is to make minds, not careers by William Deresiewicz in the American Scholar.

The Text: It didn’t dawn on me that there might be a few holes in my education until I was about 35. I’d just bought a house, the pipes needed fixing, and the plumber was standing in my kitchen. There he was, a short, beefy guy with a goatee and a Red Sox cap and a thick Boston accent, and I suddenly learned that I didn’t have the slightest idea what to say to someone like him. So alien was his experience to me, so unguessable his values, so mysterious his very language, that I couldn’t succeed in engaging him in a few minutes of small talk before he got down to work. Fourteen years of higher education and a handful of Ivy League degrees, and there I was, stiff and stupid, struck dumb by my own dumbness. “Ivy retardation,” a friend of mine calls this. I could carry on conversations with people from other countries, in other languages, but I couldn’t talk to the man who was standing in my own house.

It’s not surprising that it took me so long to discover the extent of my miseducation, because the last thing an elite education will teach you is its own inadequacy. As two dozen years at Yale and Columbia have shown me, elite colleges relentlessly encourage their students to flatter themselves for being there, and for what being there can do for them. The advantages of an elite education are indeed undeniable. You learn to think, at least in certain ways, and you make the contacts needed to launch yourself into a life rich in all of society’s most cherished rewards. To consider that while some opportunities are being created, others are being cancelled and that while some abilities are being developed, others are being crippled is, within this context, not only outrageous, but inconceivable.

I’m not talking about curricula or the culture wars, the closing or opening of the American mind, political correctness, canon formation, or what have you. I’m talking about the whole system in which these skirmishes play out. Not just the Ivy League and its peer institutions, but also the mechanisms that get you there in the first place: the private and affluent public “feeder” schools, the ever-growing parastructure of tutors and test-prep courses and enrichment programs, the whole admissions frenzy and everything that leads up to and away from it. The message, as always, is the medium. Before, after, and around the elite college classroom, a constellation of values is ceaselessly inculcated. As globalization sharpens economic insecurity, we are increasingly committing ourselves—as students, as parents, as a society—to a vast apparatus of educational advantage. With so many resources devoted to the business of elite academics and so many people scrambling for the limited space at the top of the ladder, it is worth asking what exactly it is you get in the end—what it is we all get, because the elite students of today, as their institutions never tire of reminding them, are the leaders of tomorrow.

The first disadvantage of an elite education, as I learned in my kitchen that day, is that it makes you incapable of talking to people who aren’t like you. Elite schools pride themselves on their diversity, but that diversity is almost entirely a matter of ethnicity and race. With respect to class, these schools are largely—indeed increasingly—homogeneous. Visit any elite campus in our great nation and you can thrill to the heartwarming spectacle of the children of white businesspeople and professionals studying and playing alongside the children of black, Asian, and Latino businesspeople and professionals. At the same time, because these schools tend to cultivate liberal attitudes, they leave their students in the paradoxical position of wanting to advocate on behalf of the working class while being unable to hold a simple conversation with anyone in it. Witness the last two Democratic presidential nominees, Al Gore and John Kerry: one each from Harvard and Yale, both earnest, decent, intelligent men, both utterly incapable of communicating with the larger electorate.

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