Tom Tomorrow
Wednesday, December 8, 2010
Middle-Man strikes back!
What better way to take on his arch-rivals than with an apology?
Tom Tomorrow
Tom Tomorrow
Obama: The Republican’s Reliable Interlocutor
Wednesday, December 8, 2010 by Black Agenda Report
by Glen Ford
Barack Obama reacted reflexively to Monday's orchestration of angry calls to the White House by lefties outraged at his latest grand accommodation with the GOP, spending much of his Tuesday press conference attempting a limp smack-down of Left Democrats. Oozing condescension and a certain cattiness, Obama dismissed Democratic critics for playing "games" while he did what was necessary to wring an unemployment benefits extension from the Republicans. As Obama tells it, he stood like a pragmatic rock - if one can imagine such a thing - between the Republican "hostage-takers" and the "purist" and "sanctimonious" Democrats - a party of one.
The president harkened back to "the debate that we had during health care" when much of his party complained that he was too "willing to compromise" with Republicans and bargained away the public option. Actually, Obama was determined from the start of his presidency to conspire with Republicans and corporate leaders to derail any possibility of a bill that might set the stage for single-payer legislation in 2009 or some future Congress. Instead, Obama protected private insurers by locking them so tightly into the system that it will be near impossible to dislodge them in the foreseeable future. Obama accomplished this, not just by ruthlessly marginalizing single-payer supporters, but also by choosing his own congressional operatives and effectively bypassing Democratic leadership - much the same m.o. as in his latest "compromise" with the GOP. He wielded the power of the White House and the false lure of bipartisanism to utterly smash the left half of his party, deriding the dwindling "public option" holdouts as starry-eyed perfectionists who had become the enemies of the good - a performance he reprised on Tuesday in lambasting critics of deal with the GOP on taxes on the rich.
In the course of the long health care battle - a struggle waged entirely within Democratic ranks -Obama let the air out of the Democratic balloon, and the GOP steadily rose from its valley of near-death. The Republicans wound up conceding nothing on health care, while their corporate patrons won more than they could have dared imagine back on Election Day, 2008, when it seemed that single-payer was an idea whose time had come.
The health care victory that Obama still celebrates was a defeat of fellow Democrats by the combination of a solid Republican minority, the right wing of congressional Democrats, and Obama's White House. This is Obama's formula for governance - what I call his "comfort zone" - a political space previously inhabited by Bill Clinton. Whatever the Clintons and Obama think about each other on the personal level, they have together laid a great money pipeline that flows from Wall Street to the coffers of corporate Democrats - most dramatically, bankrolling much of Obama's $700 million presidential campaign. In return, Obama reinstated the Clinton finance capitalist team that had a decade earlier reversed Franklin Roosevelt's New Deal banking regulations. Obama turned the Wall Streeters loose to engineer the greatest transfer of wealth in human history - an ongoing project that has in less than two years transformed the U.S. Treasury and Federal Reserve into sugar daddies and guarantors of finance capital, worldwide, at a cost of tens of trillions of dollars. The bailouts have melded with and overshadowed in the public mind Obama's tepid 2009 stimulus, so that Republicans can speak effectively of the two phenomena as if they are the same thing - a trick made much easier by the fact that Obama also rhetorically linked the bailouts and stimulus as one-two Democratic economic punches.
With the Democrat Party, particularly the First Black President, so thoroughly and deservedly identified with Wall Street, the Republicans were empowered to pull off what would have previously been thought impossible: the GOP's brown-shirted wing, the white supremacist-based Tea Party, which purports to abhor government and, therefore, regulation, claimed with some success to be the anti-bailout, anti-Wall Street party. Meanwhile, Obama guided the Democrats to pass a fraudulent financial regulation bill that left the derivatives casino-economy intact, if not more strongly entrenched.
The Great Recession, which by all historical rights should have sent the Republicans into eclipse for a generation, instead saw a miraculous GOP rebound that left the Democrats shattered and pitifully incoherent. That's the real big picture of Obama's brief presidency - a period of breathtaking dissolution of the Democratic Party as Obama facilitated the swallowing whole of the American state by Wall Street.
Obama doesn't really want folks to take the long view of his time in office. His modus operandi after every debacle is to claim to have rescued bits and pieces of the Democratic agenda from GOP savaging: a health care bill that, in total, is worse than none at all, a financial "reform" unworthy of the name. He early in his term set in motion his infernal deficit reduction commission, knowing it would attack social spending across the board, so that he could later "rescue" selected programs from extinction and claim saviorhood. Obama will claim to have "saved" extension of unemployment benefits by this week's "compromise" with the Republican minority in the lame duck Congress when, in reality, it is Obama's center-right modalities of governance and back-channel dealings that have allowed the GOP minority to behave like a majority.
The overarching truth of the last two years Is that Obama has been at constant war with the New Deal and the left hemisphere of his party, acting as Wall Street's Trojan Horse in the White House. Tuesday's press conference starred an unrepentant, unreconstructed, center-right, corporate operative who sees his primary duty as destroying what remains of the Democrat's progressive legacy. And the first term of the disaster is less than half over.
by Glen Ford
Barack Obama reacted reflexively to Monday's orchestration of angry calls to the White House by lefties outraged at his latest grand accommodation with the GOP, spending much of his Tuesday press conference attempting a limp smack-down of Left Democrats. Oozing condescension and a certain cattiness, Obama dismissed Democratic critics for playing "games" while he did what was necessary to wring an unemployment benefits extension from the Republicans. As Obama tells it, he stood like a pragmatic rock - if one can imagine such a thing - between the Republican "hostage-takers" and the "purist" and "sanctimonious" Democrats - a party of one.
The president harkened back to "the debate that we had during health care" when much of his party complained that he was too "willing to compromise" with Republicans and bargained away the public option. Actually, Obama was determined from the start of his presidency to conspire with Republicans and corporate leaders to derail any possibility of a bill that might set the stage for single-payer legislation in 2009 or some future Congress. Instead, Obama protected private insurers by locking them so tightly into the system that it will be near impossible to dislodge them in the foreseeable future. Obama accomplished this, not just by ruthlessly marginalizing single-payer supporters, but also by choosing his own congressional operatives and effectively bypassing Democratic leadership - much the same m.o. as in his latest "compromise" with the GOP. He wielded the power of the White House and the false lure of bipartisanism to utterly smash the left half of his party, deriding the dwindling "public option" holdouts as starry-eyed perfectionists who had become the enemies of the good - a performance he reprised on Tuesday in lambasting critics of deal with the GOP on taxes on the rich.
In the course of the long health care battle - a struggle waged entirely within Democratic ranks -Obama let the air out of the Democratic balloon, and the GOP steadily rose from its valley of near-death. The Republicans wound up conceding nothing on health care, while their corporate patrons won more than they could have dared imagine back on Election Day, 2008, when it seemed that single-payer was an idea whose time had come.
The health care victory that Obama still celebrates was a defeat of fellow Democrats by the combination of a solid Republican minority, the right wing of congressional Democrats, and Obama's White House. This is Obama's formula for governance - what I call his "comfort zone" - a political space previously inhabited by Bill Clinton. Whatever the Clintons and Obama think about each other on the personal level, they have together laid a great money pipeline that flows from Wall Street to the coffers of corporate Democrats - most dramatically, bankrolling much of Obama's $700 million presidential campaign. In return, Obama reinstated the Clinton finance capitalist team that had a decade earlier reversed Franklin Roosevelt's New Deal banking regulations. Obama turned the Wall Streeters loose to engineer the greatest transfer of wealth in human history - an ongoing project that has in less than two years transformed the U.S. Treasury and Federal Reserve into sugar daddies and guarantors of finance capital, worldwide, at a cost of tens of trillions of dollars. The bailouts have melded with and overshadowed in the public mind Obama's tepid 2009 stimulus, so that Republicans can speak effectively of the two phenomena as if they are the same thing - a trick made much easier by the fact that Obama also rhetorically linked the bailouts and stimulus as one-two Democratic economic punches.
With the Democrat Party, particularly the First Black President, so thoroughly and deservedly identified with Wall Street, the Republicans were empowered to pull off what would have previously been thought impossible: the GOP's brown-shirted wing, the white supremacist-based Tea Party, which purports to abhor government and, therefore, regulation, claimed with some success to be the anti-bailout, anti-Wall Street party. Meanwhile, Obama guided the Democrats to pass a fraudulent financial regulation bill that left the derivatives casino-economy intact, if not more strongly entrenched.
The Great Recession, which by all historical rights should have sent the Republicans into eclipse for a generation, instead saw a miraculous GOP rebound that left the Democrats shattered and pitifully incoherent. That's the real big picture of Obama's brief presidency - a period of breathtaking dissolution of the Democratic Party as Obama facilitated the swallowing whole of the American state by Wall Street.
Obama doesn't really want folks to take the long view of his time in office. His modus operandi after every debacle is to claim to have rescued bits and pieces of the Democratic agenda from GOP savaging: a health care bill that, in total, is worse than none at all, a financial "reform" unworthy of the name. He early in his term set in motion his infernal deficit reduction commission, knowing it would attack social spending across the board, so that he could later "rescue" selected programs from extinction and claim saviorhood. Obama will claim to have "saved" extension of unemployment benefits by this week's "compromise" with the Republican minority in the lame duck Congress when, in reality, it is Obama's center-right modalities of governance and back-channel dealings that have allowed the GOP minority to behave like a majority.
The overarching truth of the last two years Is that Obama has been at constant war with the New Deal and the left hemisphere of his party, acting as Wall Street's Trojan Horse in the White House. Tuesday's press conference starred an unrepentant, unreconstructed, center-right, corporate operative who sees his primary duty as destroying what remains of the Democrat's progressive legacy. And the first term of the disaster is less than half over.
The Rich Get Richer, the Poor Poorer
Tuesday, December 7, 2010 by The Huffington Post
by William Astore
More tax breaks for the rich in exchange for another year's worth of unemployment benefits for the desperate: Now there's a compromise that makes me proud to be an American. My father wouldn't have been surprised. He grew up during the Great Depression and worked in factories before he was drafted and served in the Army during World War II. Dad told me that the harder he worked (physically), the less he got paid. And he told me there was nothing like repetitive and physically-grueling factory work to make you want to improve yourself. By becoming a civil servant (a firefighter), he escaped the factory and its dismal pay for a job that paid enough to provide five children with a lower-middle-class existence.
Today's political elites seem to think that the proper way to stimulate economic growth is to empower the exploiters. That way, some of their enormous wealth will trickle down on the little people. My father knew from experience that it usually wasn't money that trickled down from the high heights of the rich.
In the spirit of the holiday season, here's a story from my Dad that recounts his attempt to get a dime pay raise at the local factory. Consider it a parable for the realities our working classes face day in and day out in this country:
So, what's the moral to the story? Our president promised hope and change. "Hope" has come in the form of more tax breaks for the rich. And "change"? To paraphrase my father: No truer saying than "that politicians have no sympathy or use for the poor."
by William Astore
More tax breaks for the rich in exchange for another year's worth of unemployment benefits for the desperate: Now there's a compromise that makes me proud to be an American. My father wouldn't have been surprised. He grew up during the Great Depression and worked in factories before he was drafted and served in the Army during World War II. Dad told me that the harder he worked (physically), the less he got paid. And he told me there was nothing like repetitive and physically-grueling factory work to make you want to improve yourself. By becoming a civil servant (a firefighter), he escaped the factory and its dismal pay for a job that paid enough to provide five children with a lower-middle-class existence.
Today's political elites seem to think that the proper way to stimulate economic growth is to empower the exploiters. That way, some of their enormous wealth will trickle down on the little people. My father knew from experience that it usually wasn't money that trickled down from the high heights of the rich.
In the spirit of the holiday season, here's a story from my Dad that recounts his attempt to get a dime pay raise at the local factory. Consider it a parable for the realities our working classes face day in and day out in this country:
It seems that Mike Calabrese on his own asked Harry Callahan [one of the owners] for a pay raise and he was refused. Mike decided to organize the men members and go down in a group. In our group he got ten men to approach Harry C. for a raise. But when it was time to "bell the cat" only three fellows went to see Harry. Well Mike said he couldn't join the group because he had already tried to get a raise. I knew I was being used but I was entitled to a raise. Well Harry said to me, "What can I do for you men?" So I said to Harry: 1) Living costs were going up; 2) We deserved a raise. So Harry said, "How much?" and I said ten cents an hour would be a fair raise. So he said I'll give you a nickel an hour raise and later you'll get the other nickel. We agreed. So, I asked Harry will everyone get a raise and he replied, "Only the ones that I think deserve it."Today, Americans are uncomfortable calling attention to pay discrepancies and exploitation because it smacks of class warfare or even Marxism. It's true that some of the worst abuses have been curbed (for example, my father worked from 6 p.m. to 6 a.m. without the benefit of overtime pay or time-and-a-half), but today's workers are simply scared: scared that their jobs will be outsourced, scared that they'll be fired; scared that they'll be replaced by automated robots. Thus they put up and shut up.
Well a month later I was drinking water at the bubbler and Harry saw me and said what a hard job they had to get the money to pay our raises. Well, Willie, Harry Callahan and his brother Sam and their two other Italian brother partners all died millionaires. No other truer saying than, "That the rich have no sympathy or use for the poor."
So, what's the moral to the story? Our president promised hope and change. "Hope" has come in the form of more tax breaks for the rich. And "change"? To paraphrase my father: No truer saying than "that politicians have no sympathy or use for the poor."
Senator Bernie Sanders: Obama's Tax Deal is a 'Moral Outrage'
Statement by Senator Bernie Sanders
Tuesday, December 7, 2010 by CommonDreams.org
WASHINGTON - Sen. Bernie Sanders (I-Vt.) issued the following statement today on the agreement announced Monday between the White House and congressional Republicans:
Tuesday, December 7, 2010 by CommonDreams.org
WASHINGTON - Sen. Bernie Sanders (I-Vt.) issued the following statement today on the agreement announced Monday between the White House and congressional Republicans:
Senator Bernie Sanders (I-VT) has been among the most outspoken critics on Capitol Hill of Obama's capitulation to the GOP on extending tax benefits for the wealthiest 2% of Americans. He called it a 'moral outrage' and vowed to do all in his power to "defeat this agreement."
"In my view, it is a moral outrage that at a time when this country has a $13.8 trillion national debt, a collapsing middle class and a growing gap between the very rich and everybody else that the Republicans would deny extended unemployment benefits to 2 million workers who are desperately struggling to pay their bills and maintain their dignity. It is also beyond comprehension that the Republicans would hold hostage the entire middle class of this country so that millionaires and billionaires would receive huge tax breaks. In my view, that is not what this country is about and it is not what the American people want to see. Our job is to save the disappearing middle class, not lower taxes for people who are already extraordinarily wealthy and increase the national debt that our children and grandchildren would have to pay.
"The immediate political task in front of us is to rally the American people so that in the next several weeks we can find at least a few Republicans who will join us in saying no to increasing the deficit by giving tax breaks to the wealthy and no to holding the unemployed and the middle class hostage.
"I believe that we have the American people on our side on this issue. My office, and I come from a small state, has received more than 600 calls today, 99 percent of them in opposition to this so-called compromise that the president negotiated with the Republicans.
"I will do everything in my power to stand up for the American middle class and defeat this agreement."
How Ireland Can Strike a Blow Against the Imperial Bankers
All Ireland Has to Do is Vote "No"
By MIKE WHITNEY
Wednesday's press conference with ECB President Jean-Claude Trichet turned out to be a real jaw-dropper. While Master illusionist Trichet didn't commit himself to massive bond purchases (Quantitative Easing) as many had hoped, he did impress the gathering with his magical skills. The Financial Times recounts Trichet's what happened like this:
Nice trick, eh? So while Jean-Claude Houdini was somberly reading from the ECB's cue cards, his central bank elves were beating down bond yields to convince investors that the contagion had been contained. Not bad for a 70-something bankster with no background in the paranormal. And it seems to have worked, too, at least for the time being. But, unlike the Fed, Trichet can't simply print money. He's required to "sterilize" the bond purchases, which means he'll have to mop up the extra liquidity created by the program. And, that's the hard part. If he pushes down yields in Ireland and Portugal, he has to tighten up somewhere else.
Trichet's critics, like Bundesbank President Axel Weber, think he's gone too far by buying up the bonds of struggling PIGS. (Portugal, Ireland, Greece and Spain) But these countries borrowing costs have skyrocketed and they're quickly losing access to the markets. The more it costs to borrow, the quicker the slide to default, which is trouble for the EU, because it means a wider meltdown across the continent. So what better time for Trichet to stretch the rules?
Maybe Weber hasn't noticed, but the EU is disintegrating, and if Irish voters reject the budget in the December 7 elections or if Spain starts to teeter, the dominoes could start tumbling and bring down the European project in a heap. That's why Portugal, Spain and the rest are counting on the ECB to lend a hand despite Berlin's relentless fingerwagging. Here's an excerpt from the Telegraph which gives a good summary of what's going on:
The real problem is political not economic, which is why Trichet's "liquidity injection" snakeoil won't do anything. The euro just isn't going to work unless it is backed by a centralized fiscal authority and perhaps an EU-wide bond market. But that means that every nation will have to sacrifice some of their own sovereignty, and no one wants to do that. So, the 16-state union keeps inching closer and closer to the chopping block and the inevitable day of reckoning.
Meanwhile, Trichet continues to do exactly what he has done from the beginning; extend more cheap loans to sinking banks, more low rates, and more propping up of collapsing bond markets. The only difference now, is that investors see the political roadblock ahead and are getting nervous. EU leaders will have to agree to a "quasi" fiscal union or the current slow-motion bank run will turn into a full-blown stampede.
From the Wall Street Journal:
Imagine you owe the bank $100, but you can only pay $10 per year. The bank agrees to the payment-schedule but only if you accept a rate of 15% per annum.
"Okay", you say. "I accept your terms."
At the end of the first year, you make your payment of $10 which reduces the amount you owe to $90. But the interest on the loan turns out to be $15, which means that you now owe $105 --more than you owed at the beginning. Finally, you realize that every year the debt will get bigger and harder to pay.
This is the pickle that Ireland is in. The IMF/EU loans put them in a fiscal straightjacket from which there is no escape. They'd be better off defaulting now and restructuring their debt so they can start over. It's better to put oneself on a sustainable growth-path than to submit to long-term economic hardship, harsh austerity measures, loss of sovereignty and civil unrest. That's just a lose-lose situation. For Ireland, leaving the EU is not the just best choice; it is the only choice. Here's how economist Barry Eichengreen sums it up:
The Irish people are being asked to suffer needlessly so that bondholders in Germany, France and England get paid-in-full on their soured investments. It's worse than a bad idea; it won't work. Ireland is just digging itself a deeper hole. But there is a way out, as Wolfgang Münchau points out in a recent op-ed in the Irish Times. Here's what he said:
Sure, the experts know what needs to be done, but nothing will come of it. German voters will never support stronger ties with the other EU nations which they have already dismissed as profligate spenders. Nor will the other countries surrender more of their own sovereignty when they see how Ireland and Greece have been treated. That means, the EU is probably headed for the dumpster. And, maybe, that's a good thing. After all, behind all the public relations hoopla, the real goal of the EU was always to create Corporatopia, a place where bankers, business chieftains and other elites lined their pockets while calling the shots. Just look at the Lisbon Treaty fiasco back in 2008, when the EU's corporate Mafia used every trick in the book to push through an agreement that ran roughshod over basic democratic principles and civil rights. Fortunately, the Irish people saw through the ruse and sent the Treaty to defeat. Here's what a spokesperson for the "No Campaign" said at the time:
On December 7, Irish MPs will vote on Cowen's austerity budget. If they reject the budget, then the IMF/EU loan package will probably not go through and the eurozone will begin to splinter. Once again, Ireland finds itself with the rare opportunity to strike a blow against the EU and end the dream of a corporate superstate. And all they need to do is vote "No".
By MIKE WHITNEY
Wednesday's press conference with ECB President Jean-Claude Trichet turned out to be a real jaw-dropper. While Master illusionist Trichet didn't commit himself to massive bond purchases (Quantitative Easing) as many had hoped, he did impress the gathering with his magical skills. The Financial Times recounts Trichet's what happened like this:
"...as Trichet started to speak, his ECB troops stepped into the market to buy as many peripheral bonds as they could, particularly Portugal and Ireland. Started evidently in bidding for 10 -25 mln € clips and then moved onto 100 mln € clips … which is very rare indeed."
Nice trick, eh? So while Jean-Claude Houdini was somberly reading from the ECB's cue cards, his central bank elves were beating down bond yields to convince investors that the contagion had been contained. Not bad for a 70-something bankster with no background in the paranormal. And it seems to have worked, too, at least for the time being. But, unlike the Fed, Trichet can't simply print money. He's required to "sterilize" the bond purchases, which means he'll have to mop up the extra liquidity created by the program. And, that's the hard part. If he pushes down yields in Ireland and Portugal, he has to tighten up somewhere else.
Trichet's critics, like Bundesbank President Axel Weber, think he's gone too far by buying up the bonds of struggling PIGS. (Portugal, Ireland, Greece and Spain) But these countries borrowing costs have skyrocketed and they're quickly losing access to the markets. The more it costs to borrow, the quicker the slide to default, which is trouble for the EU, because it means a wider meltdown across the continent. So what better time for Trichet to stretch the rules?
Maybe Weber hasn't noticed, but the EU is disintegrating, and if Irish voters reject the budget in the December 7 elections or if Spain starts to teeter, the dominoes could start tumbling and bring down the European project in a heap. That's why Portugal, Spain and the rest are counting on the ECB to lend a hand despite Berlin's relentless fingerwagging. Here's an excerpt from the Telegraph which gives a good summary of what's going on:
"Spain's former leader Felipe Gonzalez warned that unless the European Central Bank steps into the market with mass bond purchases, the EMU system will lurch from one emergency to the next until it blows up....The so-called Irish bailout solved nothing. Brushfires are breaking out everywhere. Bondholders have figured out that Ireland and Portugal are broke and their debt will have to be restructured. Its just a matter of time before the haircuts. That's why bond buyers have gone into hibernation. It's not really a panic; it just shows that investors know how to read the financial tea leaves and make rational choices. Here's more analysis from Michael Pettis who points out the inherent contradictions of the one-size-fits-all currency (euro) and the urgency of settling on a remedy:
Arturo de Frias, from Evolution Securities, said the eurozone will have to move rapidly to some sort of fiscal union to prevent an EMU-break up and massive losses on €1.2 trillion of debt lent by northern banks to the southern states....
The market will keep selling until the yields of Spanish and Italian bonds (and perhaps Belgian and French also) reach sufficiently horrendous levels. ("Mounting calls for 'nuclear response' to save monetary union", Telegraph)
"If Europe is going to "resolve" the current crisis in an orderly way, it is going to have to move very quickly – not just for the obvious financial reasons, but for much narrower political reasons. I am pretty sure that the evolution of European politics over the next few years will make an orderly solution progressively more difficult.
For ten years I have used mainly an economic argument to explain why I believed the euro would have great difficulty surviving more than a decade or two. It seemed to me that the lack or fiscal centrality and full labor mobility (and even some frictional limits on capital mobility) would create distortions among countries that could not be resolved except by unacceptably high levels of debt and unemployment or by abandoning the euro. My skepticism was strengthened by the historical argument – no fiscally fragmented currency union had ever survived a real global liquidity contraction…...The eurozone is maneuvering itself into a position where it confronts the choice between two alternatives considered "unimaginable": fiscal union or break-up." ("The rough politics of European adjustment", Michael Pettis, China Financial Markets)
The real problem is political not economic, which is why Trichet's "liquidity injection" snakeoil won't do anything. The euro just isn't going to work unless it is backed by a centralized fiscal authority and perhaps an EU-wide bond market. But that means that every nation will have to sacrifice some of their own sovereignty, and no one wants to do that. So, the 16-state union keeps inching closer and closer to the chopping block and the inevitable day of reckoning.
Meanwhile, Trichet continues to do exactly what he has done from the beginning; extend more cheap loans to sinking banks, more low rates, and more propping up of collapsing bond markets. The only difference now, is that investors see the political roadblock ahead and are getting nervous. EU leaders will have to agree to a "quasi" fiscal union or the current slow-motion bank run will turn into a full-blown stampede.
From the Wall Street Journal:
"The market was hoping the ECB would get ahead of the curve. They've disappointed us," said Marc Chandler, an analyst at Brown Brothers Harriman. Merely declining to unwind liquidity measures will do little to combat the risk of contagion on distressed assets in Spain and Portugal, he said, describing Trichet's comments as "toothpaste coming out of the tube."Ireland's problems are just the tip of the iceberg, but its a good place to start. The easiest way to explain what's going on, is by using an example:
Imagine you owe the bank $100, but you can only pay $10 per year. The bank agrees to the payment-schedule but only if you accept a rate of 15% per annum.
"Okay", you say. "I accept your terms."
At the end of the first year, you make your payment of $10 which reduces the amount you owe to $90. But the interest on the loan turns out to be $15, which means that you now owe $105 --more than you owed at the beginning. Finally, you realize that every year the debt will get bigger and harder to pay.
This is the pickle that Ireland is in. The IMF/EU loans put them in a fiscal straightjacket from which there is no escape. They'd be better off defaulting now and restructuring their debt so they can start over. It's better to put oneself on a sustainable growth-path than to submit to long-term economic hardship, harsh austerity measures, loss of sovereignty and civil unrest. That's just a lose-lose situation. For Ireland, leaving the EU is not the just best choice; it is the only choice. Here's how economist Barry Eichengreen sums it up:
"The Irish "program" solves exactly nothing – it simply kicks the can down the road. A public debt that will now top out at around 130 per cent of GDP has not been reduced by a single cent. The interest payments that the Irish sovereign will have to make have not been reduced by a single cent, given the rate of 5.8% on the international loan. After a couple of years, not just interest but also principal is supposed to begin to be repaid. Ireland will be transferring nearly 10 per cent of its national income as reparations to the bondholders, year after painful year.Still Irish Prime Minister Brian Cowen is moving forward with the faux-bailout, perhaps to endear himself to his ruffle-shirt EU overlords. And even though his administration has lost all public support, he's still pushing through his slash-and-burn budget that will pare 15 billion form public spending--raise taxes on the poor, reduce the minimum wage, slash social welfare programs and fire thousands of government workers. Irish workers will see their standard of living plunge, only to find that at the end of the year they are more in the red than ever. Here's how Edward Harrison of Credit Writedowns sums it up:
This is not politically sustainable, as anyone who remembers Germany's own experience with World War I reparations should know. A populist backlash is inevitable. The Commission, the ECB and the German Government have set the stage for a situation where Ireland's new government, once formed early next year, rejects the budget negotiated by its predecessor. Do Mr. Trichet and Mrs. Merkel have a contingency plan for this?" ("Ireland's Reparations Burden", Barry Eichengreen, The Irish Economy)
"...given the debt burdens in the periphery, some combination of monetisation and default is the most likely eventual scenario for Europe. Ireland, for example, cannot grow nominal GDP at or above the 5.8% interest rate on offer under the bailout terms. Unless the country sheds its bank debt guarantee as I recommend, default is likely. Therefore, the ECB will have to step in or Europe will risk a meltdown and dissolution." ("Brynjolfsson bets on spread convergence...", Edward Harrison, Credit Writedowns)Ireland is being thrust into a Depression. Its leaders have chosen obsequiousness and expediency over clear-headed resolve to face the challenges ahead. Cowen is condemning his people to years of high unemployment and grinding poverty for nothing. There are alternatives. It will just take a little guts.
The Irish people are being asked to suffer needlessly so that bondholders in Germany, France and England get paid-in-full on their soured investments. It's worse than a bad idea; it won't work. Ireland is just digging itself a deeper hole. But there is a way out, as Wolfgang Münchau points out in a recent op-ed in the Irish Times. Here's what he said:
"What should be done now? My ideal solution – from the perspective of the euro zone – would be a common bond to cover all sovereign debt to be followed by the establishment of a small fiscal union; furthermore, banks should be taken out of the hands of national governments and put under the wings of the European Financial Stability Facility. That would clearly solve the problem.
If this is not going to happen, what can Ireland do unilaterally now?...
First, Ireland should revoke the full guarantee of the banking system, and convert senior and subordinate bondholders into equity holders." ("Will it work? No. What can Ireland do? Remove the bank guarantee and default", Wolfgang Münchau, The Irish Times)
Sure, the experts know what needs to be done, but nothing will come of it. German voters will never support stronger ties with the other EU nations which they have already dismissed as profligate spenders. Nor will the other countries surrender more of their own sovereignty when they see how Ireland and Greece have been treated. That means, the EU is probably headed for the dumpster. And, maybe, that's a good thing. After all, behind all the public relations hoopla, the real goal of the EU was always to create Corporatopia, a place where bankers, business chieftains and other elites lined their pockets while calling the shots. Just look at the Lisbon Treaty fiasco back in 2008, when the EU's corporate Mafia used every trick in the book to push through an agreement that ran roughshod over basic democratic principles and civil rights. Fortunately, the Irish people saw through the ruse and sent the Treaty to defeat. Here's what a spokesperson for the "No Campaign" said at the time:
"The Irish people have spoken. Contrary to the predictions of social and political turmoil, we believe that hundreds of millions of people across Europe will welcome the rejection of the Lisbon Treaty. This vote shows the gulf that exists between the politicians and the elites of Europe, and the opinions of the people. As in France and the Netherlands, the political leaders and the establishment have done everything they could to push this through – and they have failed. The proposals to further reduce democracy, to militarize the EU and to let private business take over public services have been rejected. Lisbon is dead. Along with the EU Constitution from which it came, it should now be buried."
On December 7, Irish MPs will vote on Cowen's austerity budget. If they reject the budget, then the IMF/EU loan package will probably not go through and the eurozone will begin to splinter. Once again, Ireland finds itself with the rare opportunity to strike a blow against the EU and end the dream of a corporate superstate. And all they need to do is vote "No".
The Return of Debtors' Prisons
Reservations for the Poor
By STEVE BREYMAN
Spent any time recently (voluntarily or not) in an urban courtroom? After an hour or two, you’re quite certain that debtors’ prisons are back with a vengeance, and a twist. As to the vengeance: In New York City alone, according to a new report from Human Rights Watch, thousands of misdemeanor defendants are held in pre-trial detention every year because they’re unable to throw bail. Note the “pre-trial” part: these are folks merely accused rather than convicted of any offense. The situation is even worse than debtors’ prison because the accused don’t even owe a debt. They end up doing time in advance of a trial for the crime of being poor. It’s like a down payment on a sentence that may or may not include incarceration (but that’s not all the sentences may include, as we’ll see). What working poor person has $1000 lying around to invest in a municipal court as bail when they can’t make the rent, feed themselves or their children, or pay for heat? Nobody I’ve ever met. And what of the rest of our cities’ human flotsam, the unskilled unemployed, homeless, seriously mentally ill, or substance-dependent?
By STEVE BREYMAN
Spent any time recently (voluntarily or not) in an urban courtroom? After an hour or two, you’re quite certain that debtors’ prisons are back with a vengeance, and a twist. As to the vengeance: In New York City alone, according to a new report from Human Rights Watch, thousands of misdemeanor defendants are held in pre-trial detention every year because they’re unable to throw bail. Note the “pre-trial” part: these are folks merely accused rather than convicted of any offense. The situation is even worse than debtors’ prison because the accused don’t even owe a debt. They end up doing time in advance of a trial for the crime of being poor. It’s like a down payment on a sentence that may or may not include incarceration (but that’s not all the sentences may include, as we’ll see). What working poor person has $1000 lying around to invest in a municipal court as bail when they can’t make the rent, feed themselves or their children, or pay for heat? Nobody I’ve ever met. And what of the rest of our cities’ human flotsam, the unskilled unemployed, homeless, seriously mentally ill, or substance-dependent?
The details are striking.
Among defendants arrested in 2008 on nonfelony charges who had bail set at $1,000 or less, 87 percent were incarcerated because they were unable to post the bail amount at their arraignment. On average, they spent almost 16 days in pretrial detention for low-level offenses. Most were accused of nonviolent minor crimes such as shoplifting, turnstile jumping, smoking marijuana in public, drug possession, trespassing, and prostitution.
Nearly a quarter of the people spending time behind bars on Riker’s Island in 2008, one in four inmates were there because they didn’t have the money to pay bail on a misdemeanor charge. These unfortunate souls may have been presumed innocent of the criminal charges by the judge, but they were nonetheless jailed for being poor. According to Human Rights Watch (HRW), “pretrial supervision” of misdemeanor defendants is an all-around superior alternative to jailing the poor. But New York City has no such program.
Bail exists to force a defendant back into the courtroom as a case progresses. Apart from establishing a pretrial supervision program, HRW recommends judges might replace cash bail by unsecured appearance bonds (a promise to pay a certain amount upon failure to appear). Failure to appear is hardly rampant in the City’s courts. HRW found that “84 percent of released defendants show up for all their court proceedings; and most of those who miss a scheduled court appearance come back to court within 30 days.”
Then there are the joys of imprisonment for New Yorkers presumed innocent.
Jail can be dehumanizing, unpleasant, and even violent . . . It exacts a high toll on those who are incarcerated as well as on their families, who suffer from reduced income and absent parents or caregivers. Many defendants plead guilty simply to avoid or end pretrial detention. Indeed, guilty pleas account for 99.6 percent of the convictions of New York City misdemeanor defendants.
As if this routine injustice were not enough, there’s the twist, a problem not addressed by the HRW report. It concerns the sentences following the legal proceeding. Judges often sentence those convicted of nonviolent misdemeanors to some combination of community service and a fine. But if you didn’t have the wherewithal to prevent pre-trial detention, where will you find it to pay the fine? Perhaps Human Rights Watch will follow up the current study with one of this problem. How many people spend how much time behind bars because they fail to pay their court-ordered fines on time? Debtors’ prisons were common in the United States until the 1830s. Robert E. Lee’s father, and Declaration of Independence signatories James Wilson and Robert Morris spent time in prison for inability to repay debts. Gentlemen of such lofty station would not likely be incarcerated today for failure to pay (see the case last month of the hit-and-run hedge fund manager allowed a misdemeanor plea by a Colorado judge). Today, incarceration for inability to pay is reserved for the poor.
Keep Your Hands Off Our Social Security
The Drive for Cuts is Based on Deception
By MARK WEISBROT
According to a recent CNN poll, 60 percent of Americans under 60 and 70 percent of those under 50 believed that Social Security will not be able to pay them a benefit when they retire.
In reality, the likelihood that any living American's Social Security benefits will not be paid to them when they retire is about the same as the probability that there will be no U.S. government at that time. Is anybody banking on that?
Of course if you are going to take something away from people, the first step is to convince them that it wasn't really there in the first place. What makes the whole deception even more fascinating is that everyone is using the same assumptions about the future and the same numbers.
The common source for everyone writing and talking about Social Security is the annual Social Security Trustees Report. This shows that the program can pay all promised benefits for the next 27 years, without any changes at all. If nothing is done over the next 27 years, only about 75 percent of scheduled benefits would be payable in 2037; but that would still be more than what retirees receive today, after adjusting for inflation.
So, according to the assumptions and facts that everyone who writes or talks about Social Security is using, there is no basis for the belief that the majority of Americans under 60 hold. Since this deception is not about Afghanistan or some country on the other side of the world, but about a program that nearly a quarter of American adults receive a check from each month, it is all the more amazing. The enemies of Social Security have pulled off one of the greatest public relations scams in U.S. history.
What makes this subterfuge unique is that it is all based on verbal and accounting trickery. For example, it is common to combine Social Security and Medicare spending and say that their costs will become unsustainable. The trick here is that it is Medicare, not Social Security that leads to the explosion in public spending. And perhaps more importantly: it is not the aging population or Medicare itself that is the problem, but the United States' private sector health care costs. If these were in line with any other high-income country such as Germany or Canada, our long-term budget deficit would turn into a surplus.
Not that Social Security has contributed anything to the budget deficit-- the program is still running a surplus. The granny-bashers try to weasel their away around this too by pretending that the Social Security Trust Fund, currently at more than $2.5 trillion, doesn't exist. But the Treasury obligations held by the Trust Fund are as real as the U.S. government bonds held by any private mutual or pension fund, or the ten-dollar bill in your wallet.
Of course all this deception would not be possible if the media did its job and reported the basic facts. As when someone says President Obama is a Muslim, they note that he is a Christian. Of course some people will still believe whatever, but we wouldn't have a majority lost in the fog on this issue.
This huge scam is the most obvious reason to reject any benefit cuts to Social Security, which includes raising the retirement age. This is a very regressive cut that hurts lower-income workers the most, since many have jobs that are too physically demanding to work longer; and since their life expectancy has not increased along with that of higher-income employees.
We need at least a decade just to inform the public of the basic facts, before we can decide how to make the relatively small adjustments that Social Security may need to maintain long-term solvency.
By MARK WEISBROT
According to a recent CNN poll, 60 percent of Americans under 60 and 70 percent of those under 50 believed that Social Security will not be able to pay them a benefit when they retire.
In reality, the likelihood that any living American's Social Security benefits will not be paid to them when they retire is about the same as the probability that there will be no U.S. government at that time. Is anybody banking on that?
Of course if you are going to take something away from people, the first step is to convince them that it wasn't really there in the first place. What makes the whole deception even more fascinating is that everyone is using the same assumptions about the future and the same numbers.
The common source for everyone writing and talking about Social Security is the annual Social Security Trustees Report. This shows that the program can pay all promised benefits for the next 27 years, without any changes at all. If nothing is done over the next 27 years, only about 75 percent of scheduled benefits would be payable in 2037; but that would still be more than what retirees receive today, after adjusting for inflation.
So, according to the assumptions and facts that everyone who writes or talks about Social Security is using, there is no basis for the belief that the majority of Americans under 60 hold. Since this deception is not about Afghanistan or some country on the other side of the world, but about a program that nearly a quarter of American adults receive a check from each month, it is all the more amazing. The enemies of Social Security have pulled off one of the greatest public relations scams in U.S. history.
What makes this subterfuge unique is that it is all based on verbal and accounting trickery. For example, it is common to combine Social Security and Medicare spending and say that their costs will become unsustainable. The trick here is that it is Medicare, not Social Security that leads to the explosion in public spending. And perhaps more importantly: it is not the aging population or Medicare itself that is the problem, but the United States' private sector health care costs. If these were in line with any other high-income country such as Germany or Canada, our long-term budget deficit would turn into a surplus.
Not that Social Security has contributed anything to the budget deficit-- the program is still running a surplus. The granny-bashers try to weasel their away around this too by pretending that the Social Security Trust Fund, currently at more than $2.5 trillion, doesn't exist. But the Treasury obligations held by the Trust Fund are as real as the U.S. government bonds held by any private mutual or pension fund, or the ten-dollar bill in your wallet.
Of course all this deception would not be possible if the media did its job and reported the basic facts. As when someone says President Obama is a Muslim, they note that he is a Christian. Of course some people will still believe whatever, but we wouldn't have a majority lost in the fog on this issue.
This huge scam is the most obvious reason to reject any benefit cuts to Social Security, which includes raising the retirement age. This is a very regressive cut that hurts lower-income workers the most, since many have jobs that are too physically demanding to work longer; and since their life expectancy has not increased along with that of higher-income employees.
We need at least a decade just to inform the public of the basic facts, before we can decide how to make the relatively small adjustments that Social Security may need to maintain long-term solvency.
The US Government's Frontal Assault on Freedom
Hillary the Identity Thief
By PAUL CRAIG ROBERTS
The US print and TV media and the US government have made it completely clear that they have no regard for the First Amendment. Consider CNN’s Wolf Blitzer’s reaction to the leaked diplomatic cables that reveal how the US government uses deceptions, bribes, and threats to control other governments and to deceive the American and other publics. Blitzer is outraged that information revealing the US government’s improprieties reached the people, or some of them. Blitzer demanded that the US government take the necessary steps to make certain that journalists and the American people never again find out what their government is up to.
The disregard for the First Amendment is well established in the US media, which functions as a propaganda ministry for the government. Remember the NSA leak given to the New York Times that the George W. Bush regime was violating the Foreign Intelligence Surveillance Act and spying on Americans without obtaining warrants from the FISA court? The New York Times spiked the story for one year and did not release it until after Bush’s reelection. By then, the Bush regime had fabricated a legal doctrine that “authorized” Bush to violate US law.
Glenn Greenwald writing in Salon has exposed the absence of moral standards among WikiLeaks’ critics. A number of American politicians have called for the US government to murder Julian Assange, as have journalists such as neoconservative propagandist Jonah Goldberg, who wrote: “Why wasn’t Assange garroted in his hotel room years ago?”
WikiLeaks’ critics could not make it clearer that they do not believe in accountable government. And to make certain that the government is not held accountable, WikiLeaks’ critics are calling for every possible police state measure, including extra-judicial murder, to stamp out anyone who makes information available that enables the citizenry to hold government accountable.
The US government definitely does not believe in accountable government. Among the first things the Obama regime did was to make certain that there would be no investigation into the Bush regime’s use of lies, fabricated “intelligence,” and deception of the American public and the United Nations in order to further its agenda of conquering the independent Muslim states in the Middle East and turning them into US puppets. The Obama regime also made certain that no member of the Bush regime would be held accountable for violating US and international laws, for torturing detainees, for war crimes, for privacy violations or for any of the other criminal acts of the Bush regime.
As the cables leaked by a patriotic American to WikiLeaks reveal, the US government was even able to prevent accountable government in the UK by having British prime minister Brown “fix” the official Chilcot Inquiry into the deceptions used by former prime minister Tony Blair to lead the British into serving as mercenaries in America’s wars. The US was able to do this, because the British prime minister does not believe in accountable government either.
The leaked documents show that the last thing the US government wants anywhere is a government that is accountable to its own citizens instead of to the US government.
The US government’s frontal assault on freedom of information goes well beyond WikiLeaks and shutting down its host servers. In a December 2 editorial, “Wave goodbye to Internet freedom,” the Washington Times reports that Federal Communications Commission chairman Julius Genachowski has “outlined a plan to expand the federal government’s power over the Internet.”
The obvious, but unasked, question is: Why does the US government fear the American people and believe that only news that is managed and spun by the government is fit to print? Is there an agenda afoot to turn citizens into subjects?
Perhaps the most discouraging development is the accusation that is being spread via the Internet that Julian Assange is a dupe or even a covert agent used by the CIA and Mossad to spread disinformation that furthers US and Israeli agendas. This accusation might come from intelligence services striving to protect governments by discrediting the leaked information. However, it has gained traction because some of the cables contain false information. Some have concluded, incorrectly, that the false information was put into the documents for the purpose of being leaked.
There is another explanation for the false information. Diplomats concerned with advancing their careers learn to tell their bosses what they want to hear, whether true or false. Diplomats understand that the US government has agendas that it cannot declare and that they are expected to support these agendas by sending in reports that validate the undeclared agendas. For example, the US government cannot openly say that it is endeavoring to create a climate of opinion that gives the US a green light for eliminating the independent Iranian government and re-establishing an American puppet state. US “diplomats,” a.k.a., spies, understand this and fabricate the information that supports the agenda.
In my opinion, the most important of all the cables leaked is the secret directive sent by US Secretary of State Hillary Clinton to 33 US embassies and consulates ordering US diplomats to provide credit card numbers, email addresses, phone, fax and pager numbers, frequent-flyer account numbers and biographic and biometric information including DNA information on UN officials from the Secretary General down, including “heads of peace operations and political field missions.”
The directive has been characterized as the spy directive, but this is an unusual kind of spying. Usually, spying focuses on what other governments think, how they are likely to vote on US initiatives, who can be bribed, and on sexual affairs that could be used to blackmail acquiescence to US agendas.
In contrast, the information requested in the secret directive is the kind of information that would be used to steal a person’s identity.
Why does the US government want information that would enable it to steal the identities of UN officials and impersonate them?
The US government loves to pretend that its acts of naked aggression are acts of liberation mandated by “the world community.” The world community has been less supportive of US aggression since it learned that the Bush regime lied about Iraqi weapons of mass destruction. Consequently, the UN has not given Washington the green light Washington wants for a military assault on Iran. Neither has the UN given Washington the extreme sanctions that it wants the world community to impose on Iran.
As the UN refused Washington’s menu of sanctions, Washington unilaterally added its own sanction package to the UN sanctions, to the dismay of the Russians and other governments who believed that they had arrived at a compromise with Washington over the Iran sanctions issue.
Could it be that Washington wants to be able to impersonate UN officials and country delegates so that it can compromise them by involving them in fake terrorist plots, communications with terrorists real or contrived, money laundering, sex scandals and other such means of suborning their cooperation with Washington’s agendas? All the CIA has to do is to call a Taliban or Hamas chief on a UN official’s telephone number or send a compromising fax with a UN official’s fax number or have operatives pay for visits to prostitutes with a UN official’s credit card number.
The report in the Guardian on December 2 that the CIA drew up the UN spy directive signed off by Hillary Clinton is a good indication that the United States government intended to compromise the United Nations and turn the organization, as it has done with so many governments, into a compliant instrument of American policy, to an extent even greater than is already the case.
Perhaps there is another plausible explanation of why the US government desired information that would enable it to impersonate UN officials, but as a person who had a 25-year career in Washington I cannot think of what it might be.
By PAUL CRAIG ROBERTS
The US print and TV media and the US government have made it completely clear that they have no regard for the First Amendment. Consider CNN’s Wolf Blitzer’s reaction to the leaked diplomatic cables that reveal how the US government uses deceptions, bribes, and threats to control other governments and to deceive the American and other publics. Blitzer is outraged that information revealing the US government’s improprieties reached the people, or some of them. Blitzer demanded that the US government take the necessary steps to make certain that journalists and the American people never again find out what their government is up to.
The disregard for the First Amendment is well established in the US media, which functions as a propaganda ministry for the government. Remember the NSA leak given to the New York Times that the George W. Bush regime was violating the Foreign Intelligence Surveillance Act and spying on Americans without obtaining warrants from the FISA court? The New York Times spiked the story for one year and did not release it until after Bush’s reelection. By then, the Bush regime had fabricated a legal doctrine that “authorized” Bush to violate US law.
Glenn Greenwald writing in Salon has exposed the absence of moral standards among WikiLeaks’ critics. A number of American politicians have called for the US government to murder Julian Assange, as have journalists such as neoconservative propagandist Jonah Goldberg, who wrote: “Why wasn’t Assange garroted in his hotel room years ago?”
WikiLeaks’ critics could not make it clearer that they do not believe in accountable government. And to make certain that the government is not held accountable, WikiLeaks’ critics are calling for every possible police state measure, including extra-judicial murder, to stamp out anyone who makes information available that enables the citizenry to hold government accountable.
The US government definitely does not believe in accountable government. Among the first things the Obama regime did was to make certain that there would be no investigation into the Bush regime’s use of lies, fabricated “intelligence,” and deception of the American public and the United Nations in order to further its agenda of conquering the independent Muslim states in the Middle East and turning them into US puppets. The Obama regime also made certain that no member of the Bush regime would be held accountable for violating US and international laws, for torturing detainees, for war crimes, for privacy violations or for any of the other criminal acts of the Bush regime.
As the cables leaked by a patriotic American to WikiLeaks reveal, the US government was even able to prevent accountable government in the UK by having British prime minister Brown “fix” the official Chilcot Inquiry into the deceptions used by former prime minister Tony Blair to lead the British into serving as mercenaries in America’s wars. The US was able to do this, because the British prime minister does not believe in accountable government either.
The leaked documents show that the last thing the US government wants anywhere is a government that is accountable to its own citizens instead of to the US government.
The US government’s frontal assault on freedom of information goes well beyond WikiLeaks and shutting down its host servers. In a December 2 editorial, “Wave goodbye to Internet freedom,” the Washington Times reports that Federal Communications Commission chairman Julius Genachowski has “outlined a plan to expand the federal government’s power over the Internet.”
The obvious, but unasked, question is: Why does the US government fear the American people and believe that only news that is managed and spun by the government is fit to print? Is there an agenda afoot to turn citizens into subjects?
Perhaps the most discouraging development is the accusation that is being spread via the Internet that Julian Assange is a dupe or even a covert agent used by the CIA and Mossad to spread disinformation that furthers US and Israeli agendas. This accusation might come from intelligence services striving to protect governments by discrediting the leaked information. However, it has gained traction because some of the cables contain false information. Some have concluded, incorrectly, that the false information was put into the documents for the purpose of being leaked.
There is another explanation for the false information. Diplomats concerned with advancing their careers learn to tell their bosses what they want to hear, whether true or false. Diplomats understand that the US government has agendas that it cannot declare and that they are expected to support these agendas by sending in reports that validate the undeclared agendas. For example, the US government cannot openly say that it is endeavoring to create a climate of opinion that gives the US a green light for eliminating the independent Iranian government and re-establishing an American puppet state. US “diplomats,” a.k.a., spies, understand this and fabricate the information that supports the agenda.
In my opinion, the most important of all the cables leaked is the secret directive sent by US Secretary of State Hillary Clinton to 33 US embassies and consulates ordering US diplomats to provide credit card numbers, email addresses, phone, fax and pager numbers, frequent-flyer account numbers and biographic and biometric information including DNA information on UN officials from the Secretary General down, including “heads of peace operations and political field missions.”
The directive has been characterized as the spy directive, but this is an unusual kind of spying. Usually, spying focuses on what other governments think, how they are likely to vote on US initiatives, who can be bribed, and on sexual affairs that could be used to blackmail acquiescence to US agendas.
In contrast, the information requested in the secret directive is the kind of information that would be used to steal a person’s identity.
Why does the US government want information that would enable it to steal the identities of UN officials and impersonate them?
The US government loves to pretend that its acts of naked aggression are acts of liberation mandated by “the world community.” The world community has been less supportive of US aggression since it learned that the Bush regime lied about Iraqi weapons of mass destruction. Consequently, the UN has not given Washington the green light Washington wants for a military assault on Iran. Neither has the UN given Washington the extreme sanctions that it wants the world community to impose on Iran.
As the UN refused Washington’s menu of sanctions, Washington unilaterally added its own sanction package to the UN sanctions, to the dismay of the Russians and other governments who believed that they had arrived at a compromise with Washington over the Iran sanctions issue.
Could it be that Washington wants to be able to impersonate UN officials and country delegates so that it can compromise them by involving them in fake terrorist plots, communications with terrorists real or contrived, money laundering, sex scandals and other such means of suborning their cooperation with Washington’s agendas? All the CIA has to do is to call a Taliban or Hamas chief on a UN official’s telephone number or send a compromising fax with a UN official’s fax number or have operatives pay for visits to prostitutes with a UN official’s credit card number.
The report in the Guardian on December 2 that the CIA drew up the UN spy directive signed off by Hillary Clinton is a good indication that the United States government intended to compromise the United Nations and turn the organization, as it has done with so many governments, into a compliant instrument of American policy, to an extent even greater than is already the case.
Perhaps there is another plausible explanation of why the US government desired information that would enable it to impersonate UN officials, but as a person who had a 25-year career in Washington I cannot think of what it might be.
Acid Reflux Bubba Flashbacks
Obama, Can This Really be the End?
By JAMES McENTEER
To be stuck with Bush's tax cuts and progressive blues again... I can't wait any longer. I'm putting on my t-shirt that says: "I voted for Hope and Change and all I got was Bubba Lite."
I'm having classic Sixties flashbacks, like to '64, when Lyndon Johnson tarred his presidential opponent Barry Goldwater as a crazy warmonger, then escalated Vietnam into a hella conflict. Guantanamo's still in business. Fifty thousand troops remain in Iraq and it's clear now that some always will.
Afghanistan, a famously hopeless quagmire for invaders long before the Soviets spent their blood and treasure there two decades ago, remains a sinkhole of American hopes and ideals. What would victory there look like? O when will they ever learn? O when will we ever learn?
Now we know why Obama won't prosecute Bush and Cheney and Rumsfeld for crimes against the Constitution and humanity. He's following their blueprint.
For liberals, what could be worse than George WTF Bush? How about a well-spoken version of that putz, who knows better but continues all his uncivilized policies anyway?
Then it's one, two, three, what are we voting for? Don't ask me, we don't have a voice. All we've got is Hobson's Choice. Tweedle Dumb and Tweedle Damn-nation.
With millions of Americans unemployed where are the strategies for job creation? Investments in infrastructure? Education? Only the military is hiring. They've got turnover. What are they/we fighting for again? Oil? Goldman Sachs? Weapons testing? Are we for or against the Pakistanis? The Turks? The Argentines? Suppose they gave a war and nobody came?
Wikileaks reveals cynical, duplicitous U.S. State Department machinations. But unlike the Pentagon Papers, these new data dumps don't surprise a jaded, already shell-shocked public. Some things and people have changed since the 60s. No one these days expects our government or mass media to tell the truth.
Hillary Clinton now condemns the transparency of government she once favored back in the day at Wellesley. She's gone over to the Dark Side now, where Bill O'Reilly and other right-wing screamers demand Death to Julian Assange!
Wikileaks underscores how the so-called U.S. "news establishment" professionals are mere mouthpieces for their corporate/political masters. Real reporting threatens them. The U.S. is spying on its allies and has a low opinion of almost all foreign leaders? Death to Julian Assange!
Just as Obama held out hope for the Republicans long after all hope was gone, I held out hope for Obama long after his actions and inactions exposed the ugly truth. He may never give up on John Boehner and Mitch McConnell. But I have finally finally given up on him.
Let's have a REAL election in 2012. Screw the Paralyzed, Compromised Center. Who is their constituency? Screw the lesser of two evils. Let's get the whole country emotionally involved at last and figure out who we really want to be. Stop with the tiptoes!
Let the Tea Party nominate Sarah Palin while the Republican Establishment puts up Mitt Romney. Democratic Regulars can stand behind Obama if they must. It's time for progressives to nominate someone else, someone real, who will walk the walk, not just lip sync the talk.
Those of us on the left who backed Obama as the Anti-Bush have been betrayed. He resembles Bill Clinton in '92, who knew what progressives wanted to hear, then raced right to save his political life, selling his shriveled soul for "Welfare Reform." Same old same old.
Rahm Emmanuel and Joe Biden told us to stop whining because Obama's all we've got. Go piss up a rope, guys.
Obama's not with us or for us and now it's painfully clear he never was. As they used to say in the Sixties, if you're not part of the solution, you're part of the problem. That's Barack around the clock. I voted for him in 2008 but I won't vote for him in 2012 if he runs unopposed.
By JAMES McENTEER
To be stuck with Bush's tax cuts and progressive blues again... I can't wait any longer. I'm putting on my t-shirt that says: "I voted for Hope and Change and all I got was Bubba Lite."
I'm having classic Sixties flashbacks, like to '64, when Lyndon Johnson tarred his presidential opponent Barry Goldwater as a crazy warmonger, then escalated Vietnam into a hella conflict. Guantanamo's still in business. Fifty thousand troops remain in Iraq and it's clear now that some always will.
Afghanistan, a famously hopeless quagmire for invaders long before the Soviets spent their blood and treasure there two decades ago, remains a sinkhole of American hopes and ideals. What would victory there look like? O when will they ever learn? O when will we ever learn?
Now we know why Obama won't prosecute Bush and Cheney and Rumsfeld for crimes against the Constitution and humanity. He's following their blueprint.
For liberals, what could be worse than George WTF Bush? How about a well-spoken version of that putz, who knows better but continues all his uncivilized policies anyway?
Then it's one, two, three, what are we voting for? Don't ask me, we don't have a voice. All we've got is Hobson's Choice. Tweedle Dumb and Tweedle Damn-nation.
With millions of Americans unemployed where are the strategies for job creation? Investments in infrastructure? Education? Only the military is hiring. They've got turnover. What are they/we fighting for again? Oil? Goldman Sachs? Weapons testing? Are we for or against the Pakistanis? The Turks? The Argentines? Suppose they gave a war and nobody came?
Wikileaks reveals cynical, duplicitous U.S. State Department machinations. But unlike the Pentagon Papers, these new data dumps don't surprise a jaded, already shell-shocked public. Some things and people have changed since the 60s. No one these days expects our government or mass media to tell the truth.
Hillary Clinton now condemns the transparency of government she once favored back in the day at Wellesley. She's gone over to the Dark Side now, where Bill O'Reilly and other right-wing screamers demand Death to Julian Assange!
Wikileaks underscores how the so-called U.S. "news establishment" professionals are mere mouthpieces for their corporate/political masters. Real reporting threatens them. The U.S. is spying on its allies and has a low opinion of almost all foreign leaders? Death to Julian Assange!
Just as Obama held out hope for the Republicans long after all hope was gone, I held out hope for Obama long after his actions and inactions exposed the ugly truth. He may never give up on John Boehner and Mitch McConnell. But I have finally finally given up on him.
Let's have a REAL election in 2012. Screw the Paralyzed, Compromised Center. Who is their constituency? Screw the lesser of two evils. Let's get the whole country emotionally involved at last and figure out who we really want to be. Stop with the tiptoes!
Let the Tea Party nominate Sarah Palin while the Republican Establishment puts up Mitt Romney. Democratic Regulars can stand behind Obama if they must. It's time for progressives to nominate someone else, someone real, who will walk the walk, not just lip sync the talk.
Those of us on the left who backed Obama as the Anti-Bush have been betrayed. He resembles Bill Clinton in '92, who knew what progressives wanted to hear, then raced right to save his political life, selling his shriveled soul for "Welfare Reform." Same old same old.
Rahm Emmanuel and Joe Biden told us to stop whining because Obama's all we've got. Go piss up a rope, guys.
Obama's not with us or for us and now it's painfully clear he never was. As they used to say in the Sixties, if you're not part of the solution, you're part of the problem. That's Barack around the clock. I voted for him in 2008 but I won't vote for him in 2012 if he runs unopposed.
Obama's Sellout on Taxes
Game Plan for a Flat Tax, Social Security Cutbacks and Austerity
By MICHAEL HUDSON
I almost feel naïve for being so angry at President Obama’s betrayal of his campaign promises regarding taxes. I had never harbored much hope that he actually intended to enact the reforms that his supporters expected – not after he appointed the most right-wing of the Clintonomics gang, Larry Summers, then Tim Geithner, Ben Bernanke and other Bush neoliberals.
But there is something so unfair and wrong that I could not prevent myself from waking up early Tuesday morning to think through the consequences of President Obama’s sellout in the years to come. Contrary to his pretense of saving the economy, his action will intensify debt deflation and financial depression, paving the way for a long-term tax shift off wealth onto labor.
In achieving a giveaway that Democrats never would have let George Bush or other Republicans enact, Obama has laid himself open to the campaign slogan that brought down British Prime Minister Tony Blair: “You can’t believe a word he says.” He has lost support not only personally, but also – as the Republicans anticipate – for much of his party in 2012.
Yet Obama has only done what politicians do: He has delivered up his constituency to his campaign backers – the same Wall Street donors who back the Republicans. What’s the point of having a constituency, after all, if you can’t sell it?
The problem is that it’s not going to stop here. Monday’s deal to re-instate the Bush era tax cuts for two more years sets up a 1-2-3 punch. First, many former Democratic and independent voters will “vote with their backsides” and simply stay home (or perhaps be tempted by a third-party candidate), enabling the Republicans to come in legislate the cuts in perpetuity in 2012 – an estimated $4 trillion to the rich over time.
Second, Obama’s Republican act (I hate to call it a compromise) “frees” income for the wealthiest classes to send abroad, to economies not yet wrecked by neoliberals. This paves the way for a foreign-exchange crisis. Such crises traditionally fall in the autumn – and as the 2012 election draws near, it will be attributed to “uncertainty” if voters do not throw the Democrats out. So to “save the dollar” the Republicans will propose to replace progressive income taxation with a uniform flat tax (the old Steve Forbes plan) falling on wage earners, not on wealth or on finance, insurance or real estate (FIRE sector) income. A VAT will be added as an excise tax to push up consumer prices.
Third, the tax giveaway includes a $120 billion reduction in Social Security contributions by labor – reducing the FICA wage withholding from 6.2 per cent to 4.2 per cent. Obama has ingeniously designed the plan to dovetail neatly into his Bowles-Simpson commission pressing to reduce Social Security as a step toward its ultimate privatization and subsequent wipeout grab by Wall Street. This cutback will accelerate the point at which the program moves into supposed “negative equity” – a calculation that ignores the option of restoring pension funding to the government’s general budget, where it would be paid out of progressively levied income tax and hence borne mainly by the wealthy, not by lower-income wage earners as a “user fee.”
So the game plan is not merely to free the income of the wealthiest class to “offshore” itself into assets denominated in harder currencies abroad. It is to scrap the progressive tax system altogether. The Democratic Congress is making only token handwringing protests against this plan, no doubt with an eye looking forward to the campaign contributors two years down the road.
Crises usually are orchestrated years in advance. Any economic recovery typically is shaped by the way in which its predecessor economy collapsed. Medieval Europe’s emergence from the Dark Age, for example, was shaped by ancient Rome’s debt crisis caused by its aggressive oligarchy. In a similar fashion, the coming epochal tax shift off finance and property onto labor will be introduced in response to the dollar’s crisis, in much the way that we have seen Ireland and Greece tap their pension funds to bail out reckless bankers. In America as in Europe, the large “systemically important banks” that caused the crisis will be given enough money by the government – at the expense of labor (“taxpayers”) to step in and “rescue” the bad debt overhang (i.e., toxic junk).
The tactics of this fiscal game sequence are so time-tested that there should not be much surprise. So President Obama’s deal is not only financial and fiscal in scope, it is a political game changer. When Congressional Democrats sign on to this betrayal of their major election promise, they will be re-branding their claim to be the “non-Wall Street party,”
Barack Obama was trained as a lawyer. I’ve rarely met a lawyer who understands economics. That’s not their mind-set. They make deals to minimize the risk of surprises, often settling in the middle. That is legal pragmatism. When candidate Obama promised “change,” I don’t think he had any particular change in economic policy in mind. It was more a modus operandi. I suspect that he simply thought of the Presidency as being referee on “bringing people together.” Probably this personality trait was formed as a teenager, in the kind of popularity contest that teenagers engage in student council elections. Obama’s aim was to be accepted, even admired, by negotiating a compromise. He probably didn’t care much about the content.
He did care about getting political campaign backing, of course, and the rules for this are clear enough in today’s world. He was given a policy to plead, and a set of experts to plead his case. There are always enough Junk Economics advisors to work on politicians to try and convince them that “doing the right thing” means helping Wall Street. It is not a matter simply of believing that “What’s good for Wall Street is good for the economy.” To hear Tim Geithner and Ben Bernanke tell the story, the economy can’t function without a “solvent” banking system – meaning that no bank is to lose money. All gamblers on the winning side (such as Goldman Sachs) are to be made whole in cases where they cannot collect from bad casino-capitalist gamblers on the losing side (such as A.I.G. and Lehman Brothers).
So should we say that Obama’s plan really helps the economy simply because the stock market jumped sharply on Tuesday? Or are we dealing with a zero-sum game, where the predator’s subsidy is at the cost of the host economy?
Contra Obama’s pretense, cutting taxes for the rich will not spur recovery. The wealthiest 2 per cent do not spend their income on consuming more. They invest it financially – mainly in bonds, establishing more debt claims on the economy. Giving creditors more money will deepen the economy’s debt deflation, shrinking “the market’s” ability to spend on goods and services. And part of the tax subsidy will be recycled into Congressional lobbying and campaign contributions to buy politicians who will promote even more pro-financial deregulatory policies and tax benefits. There still has been no prosecution of banking crime or other financial fraud by large institutions, for example. Nor is there any sign of Attorney General Holder initiating such prosecutions.
It is a travesty for Obama to trot out the long-term unemployed (who now get a year’s extension of benefits) like widows and orphans used to be. It’s not really “all for the poor.” It’s all for the rich. And it’s not to promote stability and recovery. How stable can a global situation be where the richest nation does not tax its population, but creates new public debt to hand out to its bankers? Future tax payers will spend generations paying off their heirs.
The “solution” to the coming financial crisis in the United States may await the dollar’s plunge as an opportunity for a financial Tonkin Gulf resolution. Such a crisis would help catalyze the tax system’s radical change to a European-style “Steve Forbes” flat tax and VAT sales-excise tax falling almost entirely on employment? Big fish will eat little fish. More government giveaways will be made to the financial sector in a vain effort to keep bad debts afloat and banks “solvent.” As in Ireland and Latvia, public debt will replace private debt, leaving little remaining for Social Security or indeed for much social spending.
The bottom line is that after the prolonged tax giveaway exacerbates the federal budget deficit – along with the balance-of-payments deficit – we can expect the next Republican or Democratic administration to step in and “save” the country from economic emergency by scaling back Social Security while turning its funding over, Pinochet-style, to Wall Street money managers to loot as they did in Chile. And one can forget rebuilding America’s infrastructure. It is being sold off by debt-strapped cities and states to cover their budget shortfalls resulting from un-taxing real estate and from foreclosures.
Welcome to debt peonage. This is worse than what was meant by a double-dip recession. It will be with us much longer.
(He's just doing the bidding of his bosses since they paid for much of his campaign. He couldn't just let them scratch his back without reciprocating, could he? Man, what a disappointing president he's made. The Democrats are afraid of their shadows, much less the Republicans. A bigger collection of pussies you will never find outside of the Democratic party.--jef)
By MICHAEL HUDSON
I almost feel naïve for being so angry at President Obama’s betrayal of his campaign promises regarding taxes. I had never harbored much hope that he actually intended to enact the reforms that his supporters expected – not after he appointed the most right-wing of the Clintonomics gang, Larry Summers, then Tim Geithner, Ben Bernanke and other Bush neoliberals.
But there is something so unfair and wrong that I could not prevent myself from waking up early Tuesday morning to think through the consequences of President Obama’s sellout in the years to come. Contrary to his pretense of saving the economy, his action will intensify debt deflation and financial depression, paving the way for a long-term tax shift off wealth onto labor.
In achieving a giveaway that Democrats never would have let George Bush or other Republicans enact, Obama has laid himself open to the campaign slogan that brought down British Prime Minister Tony Blair: “You can’t believe a word he says.” He has lost support not only personally, but also – as the Republicans anticipate – for much of his party in 2012.
Yet Obama has only done what politicians do: He has delivered up his constituency to his campaign backers – the same Wall Street donors who back the Republicans. What’s the point of having a constituency, after all, if you can’t sell it?
The problem is that it’s not going to stop here. Monday’s deal to re-instate the Bush era tax cuts for two more years sets up a 1-2-3 punch. First, many former Democratic and independent voters will “vote with their backsides” and simply stay home (or perhaps be tempted by a third-party candidate), enabling the Republicans to come in legislate the cuts in perpetuity in 2012 – an estimated $4 trillion to the rich over time.
Second, Obama’s Republican act (I hate to call it a compromise) “frees” income for the wealthiest classes to send abroad, to economies not yet wrecked by neoliberals. This paves the way for a foreign-exchange crisis. Such crises traditionally fall in the autumn – and as the 2012 election draws near, it will be attributed to “uncertainty” if voters do not throw the Democrats out. So to “save the dollar” the Republicans will propose to replace progressive income taxation with a uniform flat tax (the old Steve Forbes plan) falling on wage earners, not on wealth or on finance, insurance or real estate (FIRE sector) income. A VAT will be added as an excise tax to push up consumer prices.
Third, the tax giveaway includes a $120 billion reduction in Social Security contributions by labor – reducing the FICA wage withholding from 6.2 per cent to 4.2 per cent. Obama has ingeniously designed the plan to dovetail neatly into his Bowles-Simpson commission pressing to reduce Social Security as a step toward its ultimate privatization and subsequent wipeout grab by Wall Street. This cutback will accelerate the point at which the program moves into supposed “negative equity” – a calculation that ignores the option of restoring pension funding to the government’s general budget, where it would be paid out of progressively levied income tax and hence borne mainly by the wealthy, not by lower-income wage earners as a “user fee.”
So the game plan is not merely to free the income of the wealthiest class to “offshore” itself into assets denominated in harder currencies abroad. It is to scrap the progressive tax system altogether. The Democratic Congress is making only token handwringing protests against this plan, no doubt with an eye looking forward to the campaign contributors two years down the road.
Crises usually are orchestrated years in advance. Any economic recovery typically is shaped by the way in which its predecessor economy collapsed. Medieval Europe’s emergence from the Dark Age, for example, was shaped by ancient Rome’s debt crisis caused by its aggressive oligarchy. In a similar fashion, the coming epochal tax shift off finance and property onto labor will be introduced in response to the dollar’s crisis, in much the way that we have seen Ireland and Greece tap their pension funds to bail out reckless bankers. In America as in Europe, the large “systemically important banks” that caused the crisis will be given enough money by the government – at the expense of labor (“taxpayers”) to step in and “rescue” the bad debt overhang (i.e., toxic junk).
The tactics of this fiscal game sequence are so time-tested that there should not be much surprise. So President Obama’s deal is not only financial and fiscal in scope, it is a political game changer. When Congressional Democrats sign on to this betrayal of their major election promise, they will be re-branding their claim to be the “non-Wall Street party,”
Barack Obama was trained as a lawyer. I’ve rarely met a lawyer who understands economics. That’s not their mind-set. They make deals to minimize the risk of surprises, often settling in the middle. That is legal pragmatism. When candidate Obama promised “change,” I don’t think he had any particular change in economic policy in mind. It was more a modus operandi. I suspect that he simply thought of the Presidency as being referee on “bringing people together.” Probably this personality trait was formed as a teenager, in the kind of popularity contest that teenagers engage in student council elections. Obama’s aim was to be accepted, even admired, by negotiating a compromise. He probably didn’t care much about the content.
He did care about getting political campaign backing, of course, and the rules for this are clear enough in today’s world. He was given a policy to plead, and a set of experts to plead his case. There are always enough Junk Economics advisors to work on politicians to try and convince them that “doing the right thing” means helping Wall Street. It is not a matter simply of believing that “What’s good for Wall Street is good for the economy.” To hear Tim Geithner and Ben Bernanke tell the story, the economy can’t function without a “solvent” banking system – meaning that no bank is to lose money. All gamblers on the winning side (such as Goldman Sachs) are to be made whole in cases where they cannot collect from bad casino-capitalist gamblers on the losing side (such as A.I.G. and Lehman Brothers).
So should we say that Obama’s plan really helps the economy simply because the stock market jumped sharply on Tuesday? Or are we dealing with a zero-sum game, where the predator’s subsidy is at the cost of the host economy?
Contra Obama’s pretense, cutting taxes for the rich will not spur recovery. The wealthiest 2 per cent do not spend their income on consuming more. They invest it financially – mainly in bonds, establishing more debt claims on the economy. Giving creditors more money will deepen the economy’s debt deflation, shrinking “the market’s” ability to spend on goods and services. And part of the tax subsidy will be recycled into Congressional lobbying and campaign contributions to buy politicians who will promote even more pro-financial deregulatory policies and tax benefits. There still has been no prosecution of banking crime or other financial fraud by large institutions, for example. Nor is there any sign of Attorney General Holder initiating such prosecutions.
It is a travesty for Obama to trot out the long-term unemployed (who now get a year’s extension of benefits) like widows and orphans used to be. It’s not really “all for the poor.” It’s all for the rich. And it’s not to promote stability and recovery. How stable can a global situation be where the richest nation does not tax its population, but creates new public debt to hand out to its bankers? Future tax payers will spend generations paying off their heirs.
The “solution” to the coming financial crisis in the United States may await the dollar’s plunge as an opportunity for a financial Tonkin Gulf resolution. Such a crisis would help catalyze the tax system’s radical change to a European-style “Steve Forbes” flat tax and VAT sales-excise tax falling almost entirely on employment? Big fish will eat little fish. More government giveaways will be made to the financial sector in a vain effort to keep bad debts afloat and banks “solvent.” As in Ireland and Latvia, public debt will replace private debt, leaving little remaining for Social Security or indeed for much social spending.
The bottom line is that after the prolonged tax giveaway exacerbates the federal budget deficit – along with the balance-of-payments deficit – we can expect the next Republican or Democratic administration to step in and “save” the country from economic emergency by scaling back Social Security while turning its funding over, Pinochet-style, to Wall Street money managers to loot as they did in Chile. And one can forget rebuilding America’s infrastructure. It is being sold off by debt-strapped cities and states to cover their budget shortfalls resulting from un-taxing real estate and from foreclosures.
Welcome to debt peonage. This is worse than what was meant by a double-dip recession. It will be with us much longer.
****
(He's just doing the bidding of his bosses since they paid for much of his campaign. He couldn't just let them scratch his back without reciprocating, could he? Man, what a disappointing president he's made. The Democrats are afraid of their shadows, much less the Republicans. A bigger collection of pussies you will never find outside of the Democratic party.--jef)
Tales of Economic Apocalypse
From the Deficit Panic to the TARP Financial Collapse
By DEAN BAKER
Hollywood used to be the place where creative people went to cook up outlandish horror plots. But Hollywood has been displaced. Now people go to Washington to spin their wild tales of looming disaster.
The national agenda has been dominated by such tales over the last two years. Most recently we have had the story of the bond market vigilantes doing to the United States what they have already done to Greece, Ireland and Portugal. This story requires suspending disbelief, but people who report on economic and political issues for major news outlets are good at ignoring reality.
The plot is that at some date in the not-distant future, if we don't mend our free-spending ways, no one will buy U.S. government bonds. The United baker bookStates will be forced to stand before the international community as a helpless beggar and agree to whatever humiliating terms bad guys from China to Saudi Arabia and even France choose to impose.
The plot departs from reality in several ways. The large deficits at present are due to the downturn, not profligate spending. Furthermore, there has been very little growth in government spending as a share of GDP for decades (apart from counter-cyclical spending in the downturn), undermining this key part of the story.
But the real problem stems from the logic of the impending crisis. Suppose that investors in the United States and elsewhere refuse to buy government debt. (Investors keep undermining the plot line by buying massive amounts of U.S. debt at very low interest rates.) In this case, we could have the Fed buy our debt. Unlike Greece, Ireland and Portugal, we have our own currency.
This story can lead to inflation but that is not quite the disaster story the deficit hawks are peddling. Inflation is a process that comes about through too much demand in the economy. In other words we would have over-full employment, with wages rising rapidly, which would in turn push up prices.
Furthermore, we don't end up like Zimbabwe with hyperinflation. The United States has a huge diversified economy that still produces almost 85 percent of what we consume here at home. We might see creeping inflation, which could in a bad scenario turn into the double-digit inflation that we saw in the 70s. But that still is not quite the disaster that the deficit hawks are using to scare the public into surrendering their Social Security and Medicare benefits.
After all, the economy actually did reasonably well in the 70s, growing slightly more rapidly than in the 80s. And, since inequality did not rise in the decade, the typical family did better in the 70s than the 80s.
The deficit gang also warns about a plunging dollar. Of course a decline in the dollar is exactly what we need to get our trade deficit down. This is why Treasury Secretary Tim Geithner has been asking China to raise the value of its currency against the dollar.
The deficit hawks want us to believe that China, which has been resistant to a 20-30 percent decline in the dollar relative to the yuan, would suddenly tolerate a decline of 50 or 60 percent? They want us to believe that Germany and France will watch the euro rise to a point above two dollars to a euro? And Japan will let the yen rise to the point where there are only 50 yen to the dollar?
This is where the deficit hawks horror story loses whatever credibility it held. This sort of plunge would imply the collapse of these countries' export markets in the United States. They would also be flooded with hyper-competitive U.S. exports. This is not going to happen; these countries care far more about their domestic economies than trying to be the fiscal enforcers of the deficit hawks' dreams.
In short, the horror story collapses as soon as anyone gives it any serious thought. The Wall Street gang can hardly be faulted for trying cheap scare tactics for pushing its agenda; after all it worked so brilliantly with the TARP two years ago. At the time the plot line was that unless we immediately gave all our money to the Wall Street banks, with no questions asked, then the whole economy would collapse.
The government turned over not only the $700 billion in TARP money, the Fed also made trillions of dollars of secret loans to the Wall Street banks, as was revealed last week. This support, including guarantees that may have been even more valuable, allowed giants like Citigroup, Goldman Sachs and Morgan Stanley to survive the financial collapse that they had helped to create. As a result, bank profits and executive bonuses are higher than ever.
In short, Wall Street has a proven winning strategy. Come up with an end-of-the-world horror story, get the Washington Post, National Public Radio and other media outlets to hype it endlessly, and then watch the politicians rush to hand over the taxpayers' money. Their next horror story will not doubt be the most frightening yet.
By DEAN BAKER
Hollywood used to be the place where creative people went to cook up outlandish horror plots. But Hollywood has been displaced. Now people go to Washington to spin their wild tales of looming disaster.
The national agenda has been dominated by such tales over the last two years. Most recently we have had the story of the bond market vigilantes doing to the United States what they have already done to Greece, Ireland and Portugal. This story requires suspending disbelief, but people who report on economic and political issues for major news outlets are good at ignoring reality.
The plot is that at some date in the not-distant future, if we don't mend our free-spending ways, no one will buy U.S. government bonds. The United baker bookStates will be forced to stand before the international community as a helpless beggar and agree to whatever humiliating terms bad guys from China to Saudi Arabia and even France choose to impose.
The plot departs from reality in several ways. The large deficits at present are due to the downturn, not profligate spending. Furthermore, there has been very little growth in government spending as a share of GDP for decades (apart from counter-cyclical spending in the downturn), undermining this key part of the story.
But the real problem stems from the logic of the impending crisis. Suppose that investors in the United States and elsewhere refuse to buy government debt. (Investors keep undermining the plot line by buying massive amounts of U.S. debt at very low interest rates.) In this case, we could have the Fed buy our debt. Unlike Greece, Ireland and Portugal, we have our own currency.
This story can lead to inflation but that is not quite the disaster story the deficit hawks are peddling. Inflation is a process that comes about through too much demand in the economy. In other words we would have over-full employment, with wages rising rapidly, which would in turn push up prices.
Furthermore, we don't end up like Zimbabwe with hyperinflation. The United States has a huge diversified economy that still produces almost 85 percent of what we consume here at home. We might see creeping inflation, which could in a bad scenario turn into the double-digit inflation that we saw in the 70s. But that still is not quite the disaster that the deficit hawks are using to scare the public into surrendering their Social Security and Medicare benefits.
After all, the economy actually did reasonably well in the 70s, growing slightly more rapidly than in the 80s. And, since inequality did not rise in the decade, the typical family did better in the 70s than the 80s.
The deficit gang also warns about a plunging dollar. Of course a decline in the dollar is exactly what we need to get our trade deficit down. This is why Treasury Secretary Tim Geithner has been asking China to raise the value of its currency against the dollar.
The deficit hawks want us to believe that China, which has been resistant to a 20-30 percent decline in the dollar relative to the yuan, would suddenly tolerate a decline of 50 or 60 percent? They want us to believe that Germany and France will watch the euro rise to a point above two dollars to a euro? And Japan will let the yen rise to the point where there are only 50 yen to the dollar?
This is where the deficit hawks horror story loses whatever credibility it held. This sort of plunge would imply the collapse of these countries' export markets in the United States. They would also be flooded with hyper-competitive U.S. exports. This is not going to happen; these countries care far more about their domestic economies than trying to be the fiscal enforcers of the deficit hawks' dreams.
In short, the horror story collapses as soon as anyone gives it any serious thought. The Wall Street gang can hardly be faulted for trying cheap scare tactics for pushing its agenda; after all it worked so brilliantly with the TARP two years ago. At the time the plot line was that unless we immediately gave all our money to the Wall Street banks, with no questions asked, then the whole economy would collapse.
The government turned over not only the $700 billion in TARP money, the Fed also made trillions of dollars of secret loans to the Wall Street banks, as was revealed last week. This support, including guarantees that may have been even more valuable, allowed giants like Citigroup, Goldman Sachs and Morgan Stanley to survive the financial collapse that they had helped to create. As a result, bank profits and executive bonuses are higher than ever.
In short, Wall Street has a proven winning strategy. Come up with an end-of-the-world horror story, get the Washington Post, National Public Radio and other media outlets to hype it endlessly, and then watch the politicians rush to hand over the taxpayers' money. Their next horror story will not doubt be the most frightening yet.
Our Founding Fathers Have Disowned Us...and "I've fallen and I can't get up!"
Hi. I might be assuming a bit if I wonder if anyone missed me over the past two weeks. My family and I have moved into a new home, and in the process of toting that barge and lifting that vail, I destroyed by back. It's the first significant back injury I've ever sustained--my only other back injury lasted for 3 days, while I've been close to bed-ridden for two weeks. "What a drag it is gettin' old."~~ Mick Jagger.
I was able to move everything into the house (with the much appreciated help of good friends--including our friends' daughter and friend to my own son--Jesse--who, at age 11, worked her butt off helping us move), but after all the boxes and furniture made it into the place, I collapsed. I went to a chiropractor, who did wonders for getting me up and walking again, but then the injury shifted to the other side of my back, and now both sides hurt like hell. I HATE IT! So, props to my dear wife for pulling more than her own weight these last two weeks and for putting up with me being basically useless since we moved in. The pain is slowly improving, or rather becoming less intense, so I am optimistic I'll be able to move around better soon--I mean, it hurts to sit in an upright position for longer than 30 minutes, it hurts to roll over in bed, it hurts to walk, to sit, to lie down, to breathe, to use the bathroom, to fart. You get the picture. And my wife, who never reads my blog and might never even see this about her, is a wonderfully supportive woman who deserves a whole lot better from me when I get back on my feet. And I vow to do the lion's share of tasks when I get better.
Also, it took nearly as long to get our internet connected and I'm disappointed in the massive reduction in speed and content exchange rate from my previous provider, so I might be switching ISPs again and be offline for even more time, but we haven't decided yet.
I have been using the time I have been convalescing by writing lyrics for the Spiderlegs album I'm trying to complete--a 6 year long project that has been delayed and postponed more times than I can possibly count due to everything from theft, health issues, financial issues, and issues with issues, and the issues' extended families, and...anyway, lyrically, I have hit the wall many times as far as coming up with anything worthwhile that matches the music I have produced and recorded--of which I am very proud, by the way--but yesterday, I wrote a bunch of stuff that seem to fit, but it was all very political and all sort of about the same specific set of issues I have with the political system. I don't want politics to be the dominant topic covered by the lyrics of the album (titled "Healing Is Unique to the Individual" with previously released tracks from it available for download FREE on MP3.com.au, or streamed at Facebook and MySpace). So, since they might or might not be used lyrically on this project, but since this blog is a reflection of how I personally feel about politics, I'm publishing them here for the first time. The composition probably isn't at the level it would be after being edited for fit the existing melodies or for better terminology, and I typically HATE writing to rhyme (preferring other devices such as strong metaphors, internal rhyme, and rhythm structures, etc.), but here they are for anyone who has cared to read this post up to this point.--jef
"Our Founding Fathers Have Disowned Us"
I was able to move everything into the house (with the much appreciated help of good friends--including our friends' daughter and friend to my own son--Jesse--who, at age 11, worked her butt off helping us move), but after all the boxes and furniture made it into the place, I collapsed. I went to a chiropractor, who did wonders for getting me up and walking again, but then the injury shifted to the other side of my back, and now both sides hurt like hell. I HATE IT! So, props to my dear wife for pulling more than her own weight these last two weeks and for putting up with me being basically useless since we moved in. The pain is slowly improving, or rather becoming less intense, so I am optimistic I'll be able to move around better soon--I mean, it hurts to sit in an upright position for longer than 30 minutes, it hurts to roll over in bed, it hurts to walk, to sit, to lie down, to breathe, to use the bathroom, to fart. You get the picture. And my wife, who never reads my blog and might never even see this about her, is a wonderfully supportive woman who deserves a whole lot better from me when I get back on my feet. And I vow to do the lion's share of tasks when I get better.
Also, it took nearly as long to get our internet connected and I'm disappointed in the massive reduction in speed and content exchange rate from my previous provider, so I might be switching ISPs again and be offline for even more time, but we haven't decided yet.
I have been using the time I have been convalescing by writing lyrics for the Spiderlegs album I'm trying to complete--a 6 year long project that has been delayed and postponed more times than I can possibly count due to everything from theft, health issues, financial issues, and issues with issues, and the issues' extended families, and...anyway, lyrically, I have hit the wall many times as far as coming up with anything worthwhile that matches the music I have produced and recorded--of which I am very proud, by the way--but yesterday, I wrote a bunch of stuff that seem to fit, but it was all very political and all sort of about the same specific set of issues I have with the political system. I don't want politics to be the dominant topic covered by the lyrics of the album (titled "Healing Is Unique to the Individual" with previously released tracks from it available for download FREE on MP3.com.au, or streamed at Facebook and MySpace). So, since they might or might not be used lyrically on this project, but since this blog is a reflection of how I personally feel about politics, I'm publishing them here for the first time. The composition probably isn't at the level it would be after being edited for fit the existing melodies or for better terminology, and I typically HATE writing to rhyme (preferring other devices such as strong metaphors, internal rhyme, and rhythm structures, etc.), but here they are for anyone who has cared to read this post up to this point.--jef
"Our Founding Fathers Have Disowned Us"
Our differences should not weaken usThey strengthen our uniquenessOur differences are not to be catalysts for bitter divisivenessWhen they fuel the inspiration for productive debateThere is no “right” or “wrong”—Except for “Right & Left”There are only differencesWe have so much more in common to unite usThan any differences which could ever possibly divide us
Yet, that is what we have let happen; or made happen; or bought into
We have turned one of our greatest strengths into the most self-destructive weaknessby gathering to opposite sides to argue with all our mightwhich side’s differences are “wrong”, and which are “right”Perfectly willing to fight among ourselves under the false perspectiveof “Left or Right”So determined to “win” that we lose sight of the greater purposewhy we united in the first placeThat we hold sacred above all elsethe rights which allow our differences to be our strengthsThe strengths which make us unique & keep us free!
Cccccc
TURN OFF YOUR TVDownload the shows you watch--illegally—They are commercial-freeAnd without the flicker rateWhich lulls your defiant self to sleep
TURN OFF YOUR TVIt’s only there to misinform, then put you to sleepExaggerating rumors into manufactured, mass marketed fearsNever once revealing that what we really have to fearHas always been here
TURN OFF YOUR TVIt will turn you against your neighbors, fellow citizens, your friends and familyWith insignificant issues transformed into urgently fake debatesFor divided, we were conquered very easily—
Intentionally meant to divide us
Copyright 2010 Wave CapsuleWE WERE WATCHING TV!Cccccc
RIGHT and LEFT are WRONGIt’s a fake debate meant to distract usFrom the real threat imposed upon us by the banks and über-wealthyWhile we are at each others’ throats over benign social issues & “moral” valuesÜber-Wealth kicks in our doors and takes away our propertyWhile the puppet govt they pay to control takes away our rights
America’s once great Middle Class has been dismantled intoA disenfranchised poverty stricken class of minimum wage slaves—The “unemployed” working class
We fulfill their prophesy by drinking and smoking their legal cancer poisonsWhen we eat their poison food chemicalsAll of which make us ill, requiring we seek and consume pharmaceutical poisonsOn top of all those other poisons with the end-result beingAn extremely unhealthy population lacking the strength and energy to motivate themTo RISE in DEFIANCE—chemical castration of the massesHeld still hypnotically by the TV flicker rateThat says…Stay still…you are ill…be docile…watch TV…go to sleep…
And allow the über-wealthy to take away everything we have left—Including our rights
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Kids today will never know a timewhen they are not constantly watched their whole livesAnd adults will soon forget they had a life onceWhen they were not watched all the time
Everyone on earth is a terrorist threat until rendered into complianceIt’s easier and requires less effort to watch TV or play gamesThan to assemble as a direct act of defiance
The Republic was reorganized, dismantled and rebuiltInto a corporate military-industrial oligarchic monstrosityDemocracy was taken out back and shotreplaced by unregulated plutocracy
CEOs wear the crowns once only helmed by kingsThey control all the presidents, legislators, ministers, secretaries,and generals in the worldTheir lobbyist proxies write all the laws govts pass and enforce
And propagandize through their well-paid media mouthpieces
OUR FOUNDING FATHERS HAVE DISOWNED US!!!
We willingly and with no resistance ceded OUR freedom to the Robber-BaronsHypnotizing us with paper images of fools goldThey herded us, with no resistance, atop a paper mountain which isUnable to support our ever increasing dependenceWe put these worthless paper imagesahead of the two most important pieces of paper in history:
one which declared our independence and
one which enumerated our rights
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