As you read this, Michelle Rhee is marshaling the troops to march on for Los Angeles Unified School District students. Because we all know Rhee puts "Students First," right? Here are her public reasons for the march:

• To drive voter registration and turnout for school board and mayoral elections
• To raise awareness of the unequal access to high quality education and the candidates' platforms
• To ask our candidates to listen to our community and commit to strengthening our public education system

There's a subtext in those bullets, trying to influence Los Angeles as it has in Chicago or New York or Atlanta or any metropolitan city: Charter schools will solve the problem.

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HuffPo's Investigative Fund has come up with a sharp story on the ever-expanding tax lien investment market, which you'll be surprised to know is just another way for Wall Street to gouge American taxpayers. Here are the relevant parts:

Nearly a dozen major banks and hedge funds, anticipating quick profits from homeowners who fall behind on property taxes, are quietly plowing hundreds of millions of dollars into businesses that collect the debts, tack on escalating fees and threaten to foreclose on the homes of those who fail to pay.

The Wall Street investors, which include Bank of America and JPMorgan Chase & Co., have purchased from local governments the right to collect delinquent taxes on several hundred thousand properties, many in distressed housing markets, the Huffington Post Investigative Fund has found. [...]

Some states allow the investors to tack on as much as 18 percent interest and a passel of legal fees and other charges. When property owners fail to make full payment, the investors can sue to foreclose - in some states within as little as six months. [...]

Years ago, the big banks left the buying of tax liens largely to local real estate specialists and small-time investors. These days, banks and hedge funds, stung by the failure of many speculative investments, see tax liens as a relatively safe option that can yield returns of around 7 percent.

Some banks also are packaging tax liens as securities - in a similar way to how unpaid home loans are securitized - and selling them to investors.

So broke local governments, instead of taking the time to collect taxes properly, are essentially forking over people behind on their taxes to Wall Street, where they'll have the lovely choice of paying off their taxes at usurious interest rates or losing their house to the banks that bought their tax liens. This is a great investment for banks since, even in this horrible real estate market, they can make a significant profit from selling someone's home for the relatively low price of paying off one year's worth of property taxes to the government. Either way, it's KA-CHING, KA-CHING, KA-CHING!

For those interested in learning more about how to become a financial vulture, I found this swell how-to video posted by the National Association of Tax Lien Investors. Note the sociopathic disregard for human suffering throughout it:

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Robert Reich is right: No one ever mentions this on the teevee. (Instead, we have people like Mrs. Alan Greenspan and Mika Brzezinski giving us stern lectures about tightening our belts.) In real dollars, adjusted for inflation, people are actually making less than they made thirty years ago. This is a massive systemic problem and it will require a major course correction to fix (and no, I don't mean cutting unemployment benefits):

Missing from almost all discussion of America’s dizzying rate of unemployment is the brute fact that hourly wages of people with jobs have been dropping, adjusted for inflation. Average weekly earnings rose a bit this spring only because the typical worker put in more hours, but June’s decline in average hours pushed weekly paychecks down at an annualized rate of 4.5 percent.

In other words, Americans are keeping their jobs or finding new ones only by accepting lower wages.

Meanwhile, a much smaller group of Americans’ earnings are back in the stratosphere: Wall Street traders and executives, hedge-fund and private-equity fund managers, and top corporate executives. As hiring has picked up on the Street, fat salaries are reappearing. Richard Stein, president of Global Sage, an executive search firm, tells the New York Times corporate clients have offered compensation packages of more than $1 million annually to a dozen candidates in just the last few weeks.

We’re back to the same ominous trend as before the Great Recession: a larger and larger share of total income going to the very top while the vast middle class continues to lose ground.

And as long as this trend continues, we can’t get out of the shadow of the Great Recession. When most of the gains from economic growth go to a small sliver of Americans at the top, the rest don’t have enough purchasing power to buy what the economy is capable of producing.

America’s median wage, adjusted for inflation, has barely budged for decades. Between 2000 and 2007 it actually dropped. Under these circumstances the only way the middle class could boost its purchasing power was to borrow, as it did with gusto. As housing prices rose, Americans turned their homes into ATMs. But such borrowing has its limits. When the debt bubble finally burst, vast numbers of people couldn’t pay their bills, and banks couldn’t collect.

***
A second parallel links 1929 with 2008: when earnings accumulate at the top, people at the top invest their wealth in whatever assets seem most likely to attract other big investors. This causes the prices of certain assets—commodities, stocks, dot-coms or real estate—to become wildly inflated. Such speculative bubbles eventually burst, leaving behind mountains of near-worthless collateral.

The crash of 2008 didn’t turn into another Great Depression because the government learned the importance of flooding the market with cash, thereby temporarily rescuing some stranded consumers and most big bankers. But the financial rescue didn’t change the economy’s underlying structure — median wages dropping while those at the top are raking in the lion’s share of income.

That’s why America’s middle class still doesn’t have the purchasing power it needs to reboot the economy, and why the so-called recovery will be so tepid—maybe even leading to a double dip. It’s also why America will be vulnerable to even larger speculative booms and deeper busts in the years to come.

My goodness. Who would have guessed that Republicans would try to protect the firm whose leaders helped crash the economy? Mitch McConnell told me on the teevee that Republicans are trying to reform Wall Street. Now I'm really confused!

The Securities and Exchange Commission decided to sue Goldman Sachs Group Inc. over the objections of two Republican commissioners, suggesting an unusual split at the agency that could politicize one of its most prominent cases in years.

People familiar with the matter said the five-member commission held a lengthy meeting Wednesday to debate the civil-fraud charges against Goldman, and ultimately voted 3-2 in favor of pushing forward. The charges were filed Friday.

Normally the agency prefers to have unanimous support when bringing enforcement actions against the firms it regulates. Word of the SEC split could exacerbate partisan tensions in Washington over the Obama administration's proposed financial-regulatory overhaul.

John Nester, an SEC spokesman, declined to comment.

The SEC alleges that in a 2007 deal, Goldman deceived clients by selling mortgage securities secretly designed by hedge-fund king John Paulson to profit on a plunge in housing prices. That deal was quickly approved by a panel of about a dozen senior Goldman executives, including people who helped to manage the firm's mortgage, credit and legal operations, people familiar with the situation told The Wall Street Journal.

Good to know that they're not limiting their investigation to Goldman Sachs, because this is a systemic problem and crooked Wall Street practices need to be ripped out by the roots. Not that I'm all that hopeful, because these charges are notoriously hard to prove, but you never know:

The SEC's case against Goldman Friday has exposed an open secret on Wall Street: As the housing market began to wobble a few years back, some big financial firms designed products aimed at allowing key clients, such as hedge funds, to bet on a sharp housing downturn.

Among the firms that created mortgage deals that soon went sour were Deutsche Bank AG, UBS AG and Merrill Lynch & Co., now owned by Bank of America Corp. It isn't known what deals the SEC is investigating.

Further cases could hinge on whether the SEC sees what it considers misrepresentation, and not just questions such as whether a deal favored one client over another. A critical part of the SEC's case against Goldman is that the firm allegedly misled investors by not notifying them of the role of hedge-fund investor John Paulson—who was dubious of the housing boom—in selecting what went into the mortgage deal Goldman sold. Goldman said it fully disclosed the investments and didn't need to reveal the Paulson connection.

[...] Soured mortgage investments helped trigger the near-collapse of American International Group Inc., which had insured at least $1 billion of bond deals issued by Wall Street firms in 2005 that reflected hedge funds' input, according to documents reviewed by The Wall Street Journal and people familiar with the matter. Taxpayers had to foot the bill for AIG's rescue.

Ultimately, the problems landed at American doorsteps. Losers in the mess included, for instance, a county in Washington state.

On Friday, SEC enforcement director Robert Khuzami said the agency will look closely at mortgage deals similar to the Goldman one that is the focus of the SEC action.

AverageBro: Ohhh Snap! Palin claps back at Obama!

Whiskey Fire: Need another snitch

Politics in the Zeros: Hedge fund created assets designed to fail

Angry Bear: Actual list of Social Security Trust Fund assets

Watergate Summer: Charities working with the families of the West Virginia miners

OFF THE BEATEN PATH: Ice Station Tango, Workbench, Bitch Slap Politics

The Washington Independent: Long-awaited warrantless surveillance report finally released

Emptywheel: US government covered up war crimes committed by CIA's warlord

AlterNet: Hedge Fund would rather shut down a plant than pay it's workers a fair wage

Fired Up! Missouri: Roy Blunt says it would have been "best" if Medicare and Medicaid never existed.  Then there's this idiot, and this braying jackass

alicublog: The airing of grievances

The Birmingham Free Press: How to argue with a Global Warming denier

Download | play Download | play (h/t Heather)

Bill Moyers finds parallels with the degradation of rampant steroid use in baseball to how degraded our country has become by those seeking quick ways to short cut and short circuit level playing fields.

You don't get a level playing field with performance enhancing drugs, any more than you get an honest government with political action committees and bundled contributions, or a fair economy with some derivatives, hedge funds, and private equity managers taxed at rates lower than their janitors. You get a level playing field only when the fans demand it. Suppose people stopped attending games in large numbers, stopped watching on TV, stopped buying the products hyped by the icons. The leveling would happen, or baseball as a money-making business would die. It's not likely to happen. If we can't organize to stop a brutal, bloody war in Iraq, or rectify an economic system that divides us further every day, we can hardly expect collective action from baseball fans.

There was a lesson in George Mitchell's report that I'm not sure even he recognized. The day Americans don't feel strongly enough about the need for level playing fields to fight for them -- the day when cutting corners and seeking an edge become the national pastime -- is the day democracy will be lucky even to find a seat in the bleachers.

The entire transcript available here.