What's wrong with American economy today? Rober Reich explains.

This is a short but very informative video by Robert Reich. If all the income from increased productivity in the U.S. goes to the highest 20% of individuals, but 70% of the economy is based on the consumption of the middle class, how does our economy grow? Answer - it doesn't.

Libertarians practicing Klein's "Shock Doctrine"

Want to know how much we can trust the Wall Street Banks who are screaming that new regulations will hurt their profits?? Here's what they did after Republican Senator Phil Gramm got the bill passed to eliminate the Glass-Steagall Act and remove most regulations from American banking.

During a little-noticed hearing this week in Sacramento, Calif., a firm hired by Wall Street to analyze mortgages given to borrowers with poor credit, which were then packaged and sold to investors during the boom years, revealed that as much as 28 percent of those loans failed to meet basic underwriting standards -- and Wall Street knew all along.

Worse, when the firm flagged those loans for potential issues, Wall Street banks ignored its recommendation nearly half the time and likely purchased those loans anyway -- selling them to unwitting investors who were never told that the biggest home loan due diligence firm in the country had found potential defects in these mortgages.

[Source Shanien Nasiripour, Business Reporter at the Huffington Post]

The free market politicians like Kentucky Senate candidate Rand Paul claim that the solution to the current Great Recession is to remove the regulations from businesses - including Wall Street banks. But the current Great recession is the direct result of Wall Street Bank chicanery which was permitted by the SEC, the Federal Reserve under the Libertarian Alan Greenspan and the free market proponents who passed the bills requiring deregulation.

Current Libertarian politicians are funded in large part by the billionaire Libertarian Koch brothers Charles and David. They send a lot of their money to the tea baggers like Sharron Angle (Nevada) and Jim Miller (Alaska) who won the nomination in Alaska because of a last minute sudden contribution of $600,000 of tea party money. The money is often distributed by the libertarian politician Dick Armey through his organization Freedom Works.

The current attacks on American government by the libertarian movement are an effort to concentrate power in America within a few very wealthy families. The Koch brothers are spending a great deal of money this election cycle to obtain that control. The most obvious example of this is the insurgent tea party movements, a supposed grass-roots movement carefully left leaderless so that the money provided by the libertarian billionaires can influence the movement and the media which credulously reports on their antics.

FOX News, owned by the billionaire Rupert Murdoch (the beneficiary of another inherited fortune), is part this effort. Ask who funded the many busses that were used to ship tea party individuals to Glenn Beck's Washington Monument August 28th rally.

There really is a lot going on in this election. The big pressure is the unemployment rate which remains stubbornly just below 10%. It is the direct result of earlier Libertarian free market policies that let Wall Street run wild and sell financial garbage, causing first the housing bubble and then the Great Recession. But now voters feel only the pain of the recession and don't see the government helping them. That it's the banks and private industry that caused the problem and who are not helping seems to escape the attention of the voters, probably because the voters can't vote on wealthy libertarians or on the Wall Street banks.

The result is that the Libertarians who have created the current economic and political mess are attempting to practice what Naomi Klein called Shock Doctrine. Make things bad for everyone and when they are at their worst, some group attempts to take control of the government and change the rules of the economy to favor themselves.

Will it work this election?

A month from now we'll have a better idea.

A big reason for American Unemployment - China

The Chinese are artificially keeping their currency at an unrealistically low level by using their revenue from exports to purchase government bonds (U.S. and Japanese especially) instead of buying goods and services from other countries.

Yeah? So What?

Here's Paul Krugman:

China is taxing imports while subsidizing exports, feeding a huge trade surplus. You may see claims that China’s trade surplus has nothing to do with its currency policy; if so, that would be a first in world economic history. An undervalued currency always promotes trade surpluses, and China is no different.

And in a depressed world economy, any country running an artificial trade surplus is depriving other nations of much-needed sales and jobs. Again, anyone who asserts otherwise is claiming that China is somehow exempt from the economic logic that has always applied to everyone else.

So what should we be doing? U.S. officials have tried to reason with their Chinese counterparts, arguing that a stronger currency would be in China’s own interest. They’re right about that: an undervalued currency promotes inflation, erodes the real wages of Chinese workers and squanders Chinese resources. But while currency manipulation is bad for China as a whole, it’s good for politically influential Chinese companies — many of them state-owned. And so the currency manipulation goes on.

[...]

Clearly, nothing will happen until or unless the United States shows that it’s willing to do what it normally does when another country subsidizes its exports: impose a temporary tariff that offsets the subsidy. So why has such action never been on the table?

One answer, as I’ve already suggested, is fear of what would happen if the Chinese stopped buying American bonds. But this fear is completely misplaced: in a world awash with excess savings, we don’t need China’s money — especially because the Federal Reserve could and should buy up any bonds the Chinese sell.

It’s true that the dollar would fall if China decided to dump some American holdings. But this would actually help the U.S. economy, making our exports more competitive.

So what would happen of the U.S,. Government got serious about stopping the Chinese from illegally subsidizing its exports or threatened to stop selling bonds to them?

It’s true that the dollar would fall if China decided to dump some American holdings. But this would actually help the U.S. economy, making our exports more competitive. Ask the Japanese, who want China to stop buying their bonds because those purchases are driving up the yen.

Aside from unjustified financial fears, there’s a more sinister cause of U.S. passivity: business fear of Chinese retaliation.

Consider a related issue: the clearly illegal subsidies China provides to its clean-energy industry. These subsidies should have led to a formal complaint from American businesses; in fact, the only organization willing to file a complaint was the steelworkers union. Why? As The Times reported, “multinational companies and trade associations in the clean energy business, as in many other industries, have been wary of filing trade cases, fearing Chinese officials’ reputation for retaliating against joint ventures in their country and potentially denying market access to any company that takes sides against China.”

Similar intimidation has surely helped discourage action on the currency front. So this is a good time to remember that what’s good for multinational companies is often bad for America, especially its workers.

This is the source of a lot of the American jobs which have been exported to other countries. The U.S. is letting China get away with this crap not because of U.S. power but because of U.S. weakness.

Yet as long as it goes on, America gets weaker and our unemployment rate stays high.

As long as our unemployment rate remains high, our government is under threat of being replaced. You'd think the White House would see that it was in their interest to export the unemployment from the U.S. back to China and to make their government deal with local unemployment.

Maybe after the November elections?

Not likely, though. The Obama Treasury is filled with Wall Street Bankers and their banks would be threatened by aggressive moves against China. Wall Street still runs the American government financial policy, doesn't it?

====================

I'm going to speculate further. This problem started at least as early as the early Bush administration. Bush dared not pick a fight because he had to finance his idiotic war in Iraq without raising taxes. Then Obama entered office.

Of course, the Bush economy collapsed four months before Obama took office. The Second Great Depression was clearly coming. So Obama built on the plans Henry Paulson put into place (while Bush took his vacation until the inauguration) and was able to limit the damage to no more that the Great Recession - the most extreme Recession since the 1930's. But that was just the first and surprising part of Obama's problems.

He was elected on the promise of getting a national health care plan passed and in spite of immediate financial problems, America's long-term financial problems all centered on the failed health care system. The anticipated financial problems could not be fixed without starting with health care. To top it all off the Republicans made it clear that they were going to block every significant action the Democrats and Obama took. China was a problem, but it had to wait. There's really room in the Presidency for only one, perhaps two, major problems at a time. Everything else that needs his attention has to wait its turn.

Health care dragged on too long. But part of that was Obama getting his Presidential legs under him after taking office. That happens to every President. And this year has been an election year with fangs. Also, the economic fixes were not big enough (as predicted by Krugman and others.)

But now the central problem really is the unemployment rate, and China's currency manipulations are central to that. So if nothing immediate (like another massive Oil Gusher a mile down in the Gulf of Mexico or a hurricane or an earthquake) doesn't appear in the near future and the election gets finished soon, then China's currency manipulation may get its well-deserved turn.

The Repubs are weak so the angry anarchists - populists are going after them.

Wonder why the teabaggers are going after the Republicans and not the Democrats right now? It's simple. The Repubs are a discredited party coming off a massive series of losses since 2006. The election of 2008 so completely flummoxed them that they could not agree on an acceptable candidate for President so their nomination devolved to McCain, who was and is hated by the Christian right which provides half their votes. After the debacle of 2008 they had so little to run on in 2010 that they famously put up a website asking for suggestions.

But the economy has changed the political calculus this year. Wall Street and the Republicans in partnership gave us the Great Recession, and the low-balled unemployment statistics sit at 9.5%. Foreclosures remain at record levels. So two years ago the voters voted for Hope and elected Barack Obama as President. And what's happened?

Nothing. Nada. Jackshit. the Democrats have Congress and the Presidency and they haven't done anything significant. In fact, the largest trend in the White House is to continue to Bush policies. Have they quit torture and rendition, or have they just quit announcing them?

So look at the Teabaggers. Essentially they are anarchists who refuse to assign a leadership. Their economics is largely the discredited Austrian school Libertarianism. Remembering the failure of the Ross Perot third Party movement, they looked at the two major parties and saw the Democrats in control of the two political branches and they saw the hapless Republicans who could not even decide on what platform to run on this year. So they are going after the Republicans in the primaries with a surprising level of success. So where will they go after this November's election?

The Democrats are not immune to the disaffection the teabaggers display. But they are also not a discredited minority party coming off of a Presidential election in which they were totally discredited as a party the way the Republicans currently are, either. The Republican Party leadership want to keep their jobs, so they are absolutely desperate to find issues they can compete for power on. Without the teabaggers and conservative big business domination of the media this would not be much of an election.

The Dems, however, gained national power in 2008 and so the leadership feels they are in the catbird seat. But I for one think they are as out of touch as the Republicans are. Right now the Dems are not weak enough to attack so that the teabaggers are focusing on the Republicans which is the party in disarray.

The Dems have way too many "leaders" like Rham Emmanuel who know that they are god's gift to the party and to the nation and refuse to accept questioning. They know how elections and politics really work and the Progressives are just fringe piss-ants who need to go away. They know best. Obama fits in the crowd, I think.

This is just the election where the Republicans are so weak they are facing the populists. The turn for the Dems is coming.

What make humans able to control the world? Culture.

The human species is unique. Humans are a predator par excellence. No other species existing can match humans. So what makes humans special? It's human culture. Human culture is something no other species known possesses.

So compare Humanity the most successful predators in existence. Compare humanity to the most successful land predator ever - Cats:

Saturday, January 07, 2006
Where did cats come from?
The NYTimes has a fascinating science article that describes the family tree and prehistoric migrations of cats.

January 6, 2006
DNA Offers New Insight Concerning Cat Evolution
By NICHOLAS WADE

Researchers have gained a major insight into the evolution of cats by showing how they migrated to new continents and developed new species as sea levels rose and fell.

About nine million years ago - two million years after the cat family first appeared in Asia - these successful predators invaded North America by crossing the Beringian land bridge connecting Siberia and Alaska, a team of geneticists writes in the journal Science today.

Later, several American cat lineages returned to Asia. With each migration, evolutionary forces morphed the pantherlike patriarch of all cats into a rainbow of species, from ocelots and lynxes to leopards, lions and the lineage that led to the most successful cat of all, even though it has mostly forsaken its predatory heritage: the cat that has induced people to pay for its board and lodging in return for frugal displays of affection.

This new history of the family, known as Felidae, is based on DNA analyses of the 37 living species performed by Warren E. Johnson and Stephen J. O'Brien of the National Cancer Institute and colleagues elsewhere.

Before DNA, taxonomists had considerable difficulty in classifying the cat family. The fossil record was sparse and many of the skulls lacked distinctiveness. One scheme divided the family into Big Cats and Little Cats. Then, in 1997, Dr. Johnson and Dr. O'Brien said they thought most living cats fell into one of eight lineages, based on the genetic element known as mitochondrial DNA.

Having made further DNA analyses, the researchers have drawn a full family tree that assigns every cat species to one of the lineages. They have also integrated their tree, which is based solely on changes in DNA, with the fossil record. The fossils, which are securely dated, allow dates to be assigned to each fork in the genetic family tree.

Knowing when each species came into existence, the Johnson-O'Brien team has been able to reconstruct a series of at least 10 intercontinental migrations by which cats colonized the world. The cheetah, for instance, now found in Africa, belongs to a lineage that originated in North America and some three million years ago migrated back across the Bering land bridge to Asia and then Africa.

Dr. O'Brien said the cats were very successful predators, second only to humans, and quickly explored new territories as opportunity arose. Sea levels were low from 11 million to 6 million years ago, enabling the first modern cats, in paleontologists' perspective (saber-tooth tigers are ancient cats), to spread from Asia west into Africa, creating the caracal lineage, and east into North America, generating the ocelot, lynx and puma lineages.

The leopard lineage appeared around 6.5 million years ago in Asia. The youngest of the eight lineages, which led eventually to the domestic cat, emerged some 6.2 million years ago in Asia and Africa, either from ancestors that had never left Asia or more probably from North American cats that had trekked back across the Bering land bridge.

Sea levels then rose, confining each cat species to its own continent, but sank again some three million years ago, allowing a second round of cat migrations. It was at this time that the ancestors of the cheetah and the Eurasian lynxes colonized the Old World from the New.

Chris Wozencraft, an authority on the classification of carnivorous mammals, said the new cat family tree generally agreed with one that he had just published in Mammal Species of the World, a standard reference. Dr. Wozencraft, a taxonomist at Bethel College in Indiana, based his classification on fossil and zoological information, as well as on DNA data already published by Dr. O'Brien's laboratory.

Cat fossils are very hard to tell apart, because they differ mostly just in size, and the DNA data emerging over the last decade has helped bring the field from confusion to consensus, Dr. Wozencraft said.

Despite their evolutionary success, most of the large cats are in peril because their broad hunting ranges have brought them into collision with people. "With the exception of the house cat and a few other small cat species, nearly every one of the 37 species is considered endangered or threatened," Dr. Johnson and Dr. O'Brien write in the current Annual Review of Genomics and Human Genetics.

Fewer than 15,000 tigers, cheetahs and snow leopards remain in the wild, they estimate, and pumas and jaguar populations have been reduced to about 50,000 each.

It is especially interesting that the DNA evidence ties back very closely to the limited fossil evidence, and corresponds to the history of the rise and fall of oceans that geologists have determined.

This is a story which could never be told by the anti-evolutionists. Of course, it also confirms my suspicion that house cats are the dominant species on earth. They just let us humans THINK we dominate the world, as we work to provide food and shelter for the cats.

Labels: Cats, DNA, Evolution, Wade
posted by Richard @ 5:25 PM
2 Comments:

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At 9/11/2010 9:45 PM, Blogger Richard said…

Cats are perhaps the most successful land predator that exist today. They may rank up with sharks. But they still fill a single evolutionary niche. Humans are also very highly successful predators, but there is a qualitative difference between cats or sharks as predators and humans as predators.

The difference between cats and humans is that humans are not just superb predators in their evolutionary niche. Humans have developed the tool of culture which allows them to take control of the environment in which they exist and change it to suit themselves. Cats exist in their niche where it exists. Humans change the environment to create a niche for themselves when they want to. No other species exists in as many diverse environments as humans do.

It is this ability to change the environment to suit humans that makes humans so responsible for their own effects on the environment. That godlike power that humans wield demands a similarly godlike level of responsibility that is demanded of no other species. No other species can create as much damage to the environment as humans can, and no other species can be aware of the damage they are doing.

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At 9/11/2010 10:15 PM, Blogger Richard said…

I guess I was wrong when I wrote "They just let us humans THINK we dominate the world." What has happened is that cats are the most successful predator when considering the rules of the game of land based predation. Humans, however, are the first species which ever developed the capability of changing the rules of the game.

The key to that ability to change the rules of the game is culture. Culture is based on complex abstract language (something which is inherited genetically by humans) and the resulting social creativity. So does culture dominate humans? No it doesn't.

Individuals are the decision-making units, but the tool of culture and shared knowledge is something no other species has. Humans, however, have a genetic ability to acquire the kinds of language that permit access to human culture.

Individual humans are, as a result, the creation of the culture. They make the decisions, but they are individual personalities created by the cultures they are embedded inside. (See the book "Mind, Self and Society" by George Herbert Mead.)

Cats and sharks do not have the benefits provided by a culture. No other species existing does. Nor does any other species have the ability to "plug into" the tool of culture and thus change the environment around them in controllable ways. (Red tides do not have the ability to stop destroying the environment in which they exist.)

Among other things, it should be quite clear that libertarian economics totally fails to consider this aspect of the environment or of human existence.

Voting Republican this fall is voting against America

9.5% unemployment. That's in an economy in which the total Gross Domestic Product is 70% Consumption and about 20% more is in investment. Investment does not occur if there is no predicted market to sell the goods or services the money is invested in. So expenditures of investment money which would put workers back to work are not going to happen as long as unemployment remains high and the markets for products and services is reduced.

The Republicans are suggesting (demanding) tax cuts to increase investment as the solution to unemployment. But where are the markets that the investors will invest in? If they exist they are outside the United States. Any additional employment that results from tax cuts that give the wealthy more money to invest will occur outside the U.S. Where the returns are predictable and sizable. They won't happen here in the U.S.

Here is what the New York Times has to say.

By DAVID KOCIENIEWSKI
Published: September 10, 2010

With Congressional midterm elections looming, the financial debate in Washington this fall will probably be consumed by one incendiary and expensive issue: whether, and how, to extend the multitrillion-dollar Bush tax cuts.

President Obama is advocating a mixed bag of tax proposals. He wants to extend the cuts for all but the wealthiest 2 percent of Americans and offer businesses hundreds of billions in breaks and write-offs intended to encourage investment and hiring.

Republicans, and a few Democrats, assert that the Bush tax cuts should be extended for everyone, warning that a tax increase right now, even if limited to the highest income bracket, would hurt small businesses and choke off an economic recovery that is already gasping.

Given the economy’s persistent weakness and an unemployment rate hovering above 9.5 percent, those arguments have gained traction. And because another round of government stimulus spending is considered politically unviable even if it were warranted, the debate over the tax cuts will be laced with promises to spur economic activity and reduce unemployment. The concept of lower taxes is so appealing to voters that many embrace them as an economic cure-all.

But economic research suggests that tax cuts, though difficult for politicians to resist in election season, have limited ability to bolster the flagging economy because they are essentially a supply-side remedy for a problem caused by lack of demand.

The nonpartisan Congressional Budget Office this year analyzed the short-term effects of 11 policy options and found that extending the tax cuts would be the least effective way to spur the economy and reduce unemployment. The report added that tax cuts for high earners would have the smallest “bang for the buck,” because wealthy Americans were more likely to save their money than spend it.

The office gave higher marks to the proposal, now embraced by President Obama, to allow small businesses to write off 100 percent of their investment costs.

Neither of those options, though, would do as much to stimulate the economy as offering direct payments to the unemployed and Social Security recipients or reducing the payroll taxes of workers, the study found. But those proposals — as well as aid to states and municipalities — are considered politically untenable with many elected officials reluctant to even utter the word “stimulus” after the $787 billion stimulus.

So while the decision on whether to extend the tax cuts will have a lasting impact on the deficit and on how the nation’s tax burden is distributed, economists and tax experts say it is unlikely to offer much immediate relief for high unemployment and sluggish growth.

“It may have some small impact along the margins, but firms don’t hire based on tax breaks; they hire based on demand,” said Roberton Williams, a senior fellow at the nonpartisan Tax Policy Center. “So a lot of the tax breaks are likely to be rewarding people and companies for that they were going to do anyway.”

When they were signed into law in 2001 and 2003, the huge package of income and capital gains tax reductions that became known as the Bush tax cuts were hailed as a way distribute the government surplus and promote long-term economic growth. Mr. Bush was so confident in their power to generate business growth and revenue that he predicted they would enable the government to pay down $1 trillion in debt in just four years.

Those surpluses have now become crushing deficits because of a combination of factors, including the recession, the cost of the wars in Iraq and Afghanistan, the Medicare prescription drug benefit, and the $1.7 trillion in forgone revenue from the tax cuts themselves.

The specter of a ballooning national debt has led even some of the early supporters of the cuts, including the former Federal Reserve chairman Alan Greenspan, to advocate letting them expire.

The Republicans are being paid off by the wealthy to push for tax cuts because that benefits the wealthy. But the Obama administration is pushing for aid to small businesses. Small businesses are where all new employment occurs. The Republicans are fighting against that proposal because it will succeed in improving the economy and that will make Obama harder to defeat in 2012.

Anyone who votes for Republicans This November is voting against America's economic success and for the Republican Party regaining power. It's really that simple.

Mirror Neurons and empathy - the science that shows Libertrianism is a lie

The premises on which Libertarianism are based are a crock. This talk shows why.



The invisible hand that makes economies, nations, families and busineses work is not self-interest. It is empathy based on mirror Neurons that makes all these groups work.

[H\T to Daniel De Groot at OpenLeft.

Original source http://www.cognitivemedia.co.uk/ (Cognitivemedia]