Weekly Roundup 5/16/2011

Million-Dollar Wasteland: A failed promise of better public housing
Debbie Cenziper and Jonathan Mummolo, The Washington Post, May 15, 2011

Synopsis: “The federal government’s largest housing construction program for the poor has squandered hundreds of millions of dollars on stalled or abandoned projects and routinely failed to crack down on derelict developers or the local housing agencies that funded them.” That’s the dramatic lead of the first in a multi-story series based on a yearlong investigation into housing projects funded by the federal Department of Housing and Urban Development (HUD). Out of 5,100 open projects, reporter Cenziper and Mummolo found that 700 – about one out of seven – “have been idling for years,” some as long as a decade. The open projects have been awarded $400 million in federal funds.

Takeaway: The program is “dysfunctional,” the reporters write, with few rules or safeguards to ensure that the federal funds are well spent.

--Kenneth Jost, Associate Editor

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In Prison Reform, Money Trumps Civil Rights
Michelle Alexander, The New York Times, May 14, 2011

A critic of U.S. criminal justice takes issue with many of the politicians now arguing for less incarceration. Alexander, author of a 2010 book that characterizes the penal system as an updated form of Jim Crow, argues that Newt Gingrich and other conservatives who now criticize mass incarceration are ignoring the racial and human-rights dimensions of the issue. Instead, they focus on the rising costs of imprisonment at a time of financial crisis for state governments. That argument won’t suffice to rally public opinion to the cause of overhauling the penal system, Alexander maintains.

--Peter Katel, Staff Writer

For background, see Peter Katel, “Downsizing Prisons,” CQ Researcher, March 11, 2011.

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Wall Street and the Financial Crisis: Anatomy of a Financial Collapse
Senate Permanent Subcommittee on Investigations, April 13, 2011

Synopsis: Based on a two-year investigation, the majority and minority staffs of a Senate committee headed by Chairman Carl Levin, D-Mich, and ranking member Tom Coburn, R-Okla., conclude that the financial-market meltdown of 2008 stemmed from high-risk lending, regulatory failure, inflated financial-institution credit ratings by ratings agencies including Moody’s and Standard & Poor’s, and a bevy of flagrant misbehaviors including multiple severe conflicts of interest and outright fraud on the part of large investment banks.

Takeaway: “The investigation found that, the crisis was not a natural disaster, but the result of high risk, complex financial products; undisclosed conflicts of interest; and the failure of regulators, the credit rating agencies, and the market itself to rein in the excesses of Wall Street,” the bipartisan analysis concludes.

--Marcia Clemmitt, Staff Writer

For background, see Marcia Clemmitt, “Financial Industry Overhaul,” CQ Researcher, July 30, 2010; Thomas J. Billitteri, “Financial Bailout,” CQ Researcher, Oct. 24, 2008, updated July 30, 2010; and Kenneth Jost, “Financial Crisis,” CQ Researcher, May 9, 2008.

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People Have Been Looking for Gold for 100 Years
Gary Wolf, The New York Times Magazine, May 15, 2011

Synopsis: Once again, dear reader, I’m going to do you a favor and skip all the depressing things I read this weekend – the head of the IMF getting arrested on sexual-assault charges, the secret mercenary force created for the rulers of the United Arab Emirates by Erik Prince, the billionaire founder of Blackwater Worldwide. Instead, I’m going to put you on to such a compelling (and relatively happy) story that you’ll get whiplash turning the pages (and forgive me if I’ve used that metaphor before, but having appropriated it once, it just seems wasteful to use it only once.) The story is about modern-day gold prospector Shawn Ryan (a former mushroom hunter) and the new hunt for gold he kicked off in Canada’s Yukon Territory. (Think Klondike gold rush redux.) Anyway, Ryan and his partner, Cathy Wood, now own more than 35,000 gold claims (an area bigger than Luxembourg)…and no longer live in a rustic cabin without electricity where the temperatures hit 50 degrees below zero.

Takeaway: Just when you think you’ve heard it all, a story comes along to restore your faith in the human spirit, not to mention the possibilities for adventure and fabulous riches.

--Tom Colin, Contributing Editor