Sunday Afternoon Links

This and that for your Sunday reading.

- Matt Taibbi discusses how public pension funds are being looted for the benefit of a few well-connected banksters:

Hedge funds have good reason to want to keep their fees hidden: They're insanely expensive. The typical fee structure for private hedge-fund management is a formula called "two and twenty," meaning the hedge fund collects a two percent fee just for showing up, then gets 20 percent of any profits it earns with your money. Some hedge funds also charge a mysterious third fee, called "fund expenses," that can run as high as half a percent – Loeb's Third Point, for instance, charged Rhode Island just more than half a percent for "fund expenses" last year, or about $350,000. Hedge funds will also pass on their trading costs to their clients, a huge additional line item that can come to an extra percent or more and is seldom disclosed. There are even fees states pay for withdrawing from certain hedge funds.

In public finance, hedge funds will sometimes give slight discounts, but the numbers are still enormous. In Rhode Island, over the course of 20 years, Siedle projects that the state will pay $2.1 billion in fees to hedge funds, private-equity funds and venture-capital funds. Why is that number interesting? Because it very nearly matches the savings the state will be taking from workers by freezing their Cost of Living Adjustments – $2.3 billion over 20 years.

"That's some 'reform,'" says Siedle.

"They pretty much took the COLA and gave it to a bunch of billionaires," hisses Day, Providence's retired firefighter union chief.

- The Star's editorial board weighs in on the lack of job opportunities for young workers.

- CBC reports on Alberta's order that a lake be drained in an attempt to contain an ongoing bitumen spill. But of course, it would make more sense to identify and mitigate the risk of that kind of disaster before it materializes - even as the Cons have taken steps to make sure that their oil-industry benefactors don't have to bother carrying out any environmental assessment before putting our land and water at risk.

- Which is to say that the tar sands represent possibly the most important example of a lack of upstream thinking in our current governments. But the new Upstream think tank is working on questioning the short-sighted thinking that leads to harmful (and avoidable) consequences in the long run.

- Finally, Peter Loewen discusses why nomination elections are so valuable within our democratic process:

Hard data on contested versus uncontested nominations are hard to come by, but some do exist. In a recent academic article, Royce Koop and Amanda Bittner document the trend of appointments. In each election from 1993 to 2008, approximately five per cent of Liberal candidates were appointed. This may seem a modest number, but the cumulative effect is a cause for concern. By 2008, a fifth of Liberal MPs were originally appointed candidates. Most have never contested a nomination.

Appointed candidates and those who win nomination battles have different careers. Those who enter politics via a secure candidacy are more likely to find themselves taking up cabinet positions and other high-profile sinecures. They eschew the lower-profile tasks of representation and constituency work.
...Insisting on open local nominations requires candidates to do two things. First, to establish that they are willing to solicit the support of local party members, just as they will have to soon request the support of all local voters. Second, to demonstrate that they can.