Whiskey, Tango, Foxtrot - over.

Conservatives and Liberals experience the world differently

2012-01-27T15:36:00.004-06:00

When someone reacts to something conservatives say by asking what universe they exist in, the question may make sense beyond just being snark. Science is beginning to determine that liberals and conservatives really do live in different universes. This is a quick report from Wired.

Research has already shown that, compared to liberals, conservatives display heightened responses to threatening images. Michael Dodd of the University of Nebraska wanted to explore this in finer detail: He showed 46 left- or right-leaning Nebraskans a series of images alternately disgusting (spiders on faces, open wounds) and appealing (smiling children, cute rabbits.) Dodd's team found that conservatives reacted most strongly to negative images, and liberals most strongly to positive photographs.

Then he showed them pictures of well-known politicians. The same patterns held: Conservatives displayed more distaste than liberals for politicians they disliked, while liberals felt more positive than conservatives about politicians they liked. Given these and other findings, wrote Dodd's team, "those on the political right and those on the political left may simply experience the world differently."

That sounds pessimistic, but it doesn't have to be. It can be a healthy reminder that people with whom we disagree aren't stupid or irrational; they just have different perspectives.

""

Image: Each graph depicts the arousal response of conservatives (triangle dots) and liberals (square dots) to images that are disgusting or appealing (left set) and pictures of opposing politicians (right set). (Dodd et al./Philosophical Transactions of the Royal Society B)

Citation: "The political left rolls with the good and the political right confronts the bad: connecting physiology and cognition to preferences." By Michael D. Dodd, Amanda Balzer, Carly M. Jacobs, Michael W. Gruszczynski, Kevin B. Smith and John R. Hibbing. Philosophical Transactions of the Royal Society B, Vol. 367 No. 1589, March 5, 2012.

Jon Stewart on Romney's taxes

2012-01-25T18:16:00.004-06:00

This may be Jon Stewart's best opening monologue yet.

The Daily Show with Jon Stewart
Get More: Daily Show Full Episodes,Political Humor & Satire Blog,The Daily Show on Facebook

I still think that Romney will be the Republican candidate for President, Adelson's $10 million (so far - in about a month) to Gingrich notwithstanding.

2011 was the end of the US Hyperpower

2012-01-01T23:40:00.004-06:00

According to Juan Cole:

Some years are pivotal and serve to mark off eras of history. 2011 saw the end of American hyperpower, and it announced the end of a decade of US-Muslim conflict that began with 2001. It saw the killing of Usama Bin Laden, the virtual rolling up of al-Qaeda, the repudiation of al-Qaeda’s methods by the masses of the Arab world, and the US military withdrawal from Iraq. The upheavals of the Arab Spring and subsequent elections have led to Muslim fundamentalist parties being drawn into parliamentary politics on a Westminster model, rather than remaining sect-like corporate groups outside the body politic.

[...]

The end of the Cold War, which had stretched from 1946 to 1991, had left the political elites of the United States and Western Europe without a bogeyman or security threat on which they could run for office and through which they could funnel resources to the military-industrial complex that largely pays for their political campaigns. With Russia in steep decline in the 1990s and China still run as a small, cautious power, the US emerged as what the French called a Hyperpower, the sole superpower. US hawks were impatient that Bill Clinton seemed not to realize that he had complete freedom of movement for a brief window of time. It was the new US status of hyperpower that allowed the G. W. Bush administration to respond to the September 11 terrorist attacks by launching two major wars and a host of smaller struggles, all against targets in the Muslim world.

As of 2011, the age of the US hyperpower is passing, along with the possibilities for American wars of choice, i.e., wars of aggression.

Was 2011 the year that signals the end of America as the only World Hyperpower. Al Jazeera showed an hour long program called Empire that suggests it was. Here is an excerpt from the transcript of that program (transcript here.)

Marwan Bishara

This is Empire.

Hello and welcome to Empire. I am Marwan Bishara. The United States has the world’s biggest economy, strongest military and the most influential culture. It’s the only power with a global project defended and supported by more aircraft carriers, Fortune 500 companies and most successful media-tainment conglomerates than any other. But America’s post-cold war optimism, following the collapse of the Soviet Union, has given way to pessimism, forecasting a declining power and more crucially, the end of an American era. The rise of new divisional and global powers, coupled with Washington’s recent war fiascos and financial crisis have worsened the outlook for America’s future.

Countless books have gone beyond recent developments to illustrate a persistent decline with titles like Suicide of a Superpower, The Empire Has No Clothes, Taming American Power, Nemesis, The Last Days of the American Republic, Colossus, The Rise and Fall of The American Empire and Selling Out a Superpower. But how serious are the Doomsday scenarios? Is this decline temporary or reversible and what does it mean to America and the rest of the world? Well joining me to answer these questions and more are Tom Engelhardt, editor of the American Empire Project and a popular website Tomdispatch, the author of the United States of Fear. Susan Glasser, editor-in-chief of Foreign Policy magazine, former editor at the Washington Post and co-author of Kremlin Rising Vladimir Putin’s Russia And The End of Revolution. And Cynthia Enloe, professor of woman’s studies and international development at Clark University, the author of The Real State of America Atlas, Mapping the Myths and Truths of the United States and Bananas, Beaches and Bases, Making Feminist Sense of International Politics. Last, but not least, Stephen Walt, professor of International Affairs at Harvard University, the author of Taming American Power and co-author of the Israel Lobby. Our starting point is US strategic overstretch.

The show itself is here:

America's relative economic decline internationally has been quite obvious for several decades. In some ways I suspect that America has been trading the existence of its middle class for the military that has substituted for the economic dominance that existed after the end of WW II. The election of Ronald Reagan as President signaled both the end of increases in real wages for workers and the sharp increase in the absolute size of the American military. That increase in the military has been the largest single reason for the deficit that the Conservatives have decried since Obama was elected President, but the deficit has occurred primarily under Republican Presidents.

Now the Wall Street banks have given the world the Great Recession and America can no longer afford to spend a third of the federal budget on a military force that is more expensive that the total military forces of every other nation in the world.

All of these trends came together in 2011. Something is going to have to change radically in 2012. In fact, it may have already changed and we are only just beginning to see what broke. As this election year plays out a lot of it will be exposed - and the fear of the changes will bring forth a lot of lies to conceal the facts. 2012 is going to be a rough year.

Romney will be the Republican nominee

2011-12-25T09:27:00.003-06:00

Right now the four possible Republican candidates for President are Romney, Gingrich, Ron Paul and trailing the pack, Rick Perry. But the recent announcement that Gingrich and Perry failed to qualify for the very significant Virginia primary to be held March 6, 2012 pretty much establishes that Romney is going to be the nominee. Let's look at Ron Paul, Newt Gingrich and Rick perry individually.

Ron Paul

Ron Paul has a good chance to win the Iowa caucuses according to Nate Silver. But he isn't likely to be able to build on that relatively strong showing in Iowa. His support is quite strong, but very narrow. Nate estimates that at the very best Ron Paul might be able to get about one-third of the Republican votes.

Nate bases his opinion on a series of polls. But his analysis comes from before the Republican establishment really started going after Ron Paul because he was beginning to appear to be a real threat to Romney. The growing chorus quoting Ron Paul's racist writings in his 1980's and 1990's news letters will lower these numbers. So will wider distribution of his views regarding pulling American troops back to the American shores and entering a new period of American isolationism.

Ron Paul's fervant supporters will keep him in the Republican nomination process until it ends, but I think Nate Silver's estimate as high as one-third of Republican voters is highly optomistic.

Newt Gingrich

The next candidate to look at is Newt Gingrich. Newt's disorganization has jumped up to bite him big time. He has failed to qualify for the Virginia Primary which is to be held on Super Tuesday March 6, 2012. His campaign needed signatures from 10,000 registered voters, including 400 from each of the states 11 Congressional Districts. The Newt campaign could not organize itself well enough to achieve a relatively small admininstrative requirement by the deadline. This failure demonstrates what most observers already recognize - Newt is horribly disorganized.

It will be interesting to see if Newt's secretive backers and their Super Pacs who have funded Newt's recent rise from obscurity to being considered a viable candidate forthe Republican nomination as an alternate to Romney will continue throught the Spring.

Rick Perry

Rick Perry, the only other non-Romney candidate likely to be able to compete into the Spring, also failed to qualify for the Virginia primary. Like Newt, Rick Perry has had the appearance of being a well-funded alternative to Mitt Romney. His series of gaffes in the debates have clearly demonstrated that he is not Presidential quality, but his deep-pocketed funders in Texas have been willing to shell out the money for the primary season anyway. I'm not sure what his funders thought they were going to buy, but it's pretty sure Rick Perry will never deliver to them. America as a whole is the winner here.

Mitt Romney

Given the weaknesses of Romney's three major opponents and the fact that the Republican establishment is circling the wagons in support of Mitt it looks like Mitt Romney will, as previously expected, be the Republican nominee for President.

Is there a chance this line up will change this spring? There's always a chance, but that chance is getting smaller and smaller. Without the Virginia votes on Super Tuesday Gingrich and Perry are very unlikely to be able to effectively challenge Romney. Ron Paul will never get over 35% of the Republicans and I'll be surprised if he gets 20%. The more Paul moves to become a real challenger the more the fact that he is utterly insane will become clear even to the Republican voters. The field of candidates really has winnowed down that tightly.

Both the tea partiers and the evangelical Republicans are going to make a lot of noise objecting to Romney, but as spring moves forward their hatred of Obama and the hope that Romney can defeat him will damp down that noise. As much as the evangelicals dislike Romney's Mormon religion, they hate Obama and the Democrats worse. They will hold their collective noses and prepare to vote for Romney in November.

The media is going to hate this. Where is the conflict that drives ratings and advertising? No drama Obama isn't going to give it to them, and while Romney will try to lure the media in he doesn't have much to offer them until after the Republican convention in August. That leaves the media in about a six months long silly season from Super Tuesday until the conventions. Then it will be Obama vs Romney - just as has been clear since last summer.

Gingrich recognizes the Supreme Court's self-inflected political weakness

2011-12-18T15:41:00.002-06:00

Newt Gingrich told Bob Schieffer today on CBS' Face the Nation that America does not need to obey orders of the Supreme Court if America disagrees with those court orders. In fact, he goes on to state that Congress can send the Capital Police to arrest 'Radical' Judges.

I have to give Gingrich credit for choosing a detested target which has weakened itself politically during the 21st Century.

The US Supreme Court (SC) has really worked very hard to destroy its' own political legitimacy, especially with their unjustified and clearly illegitimate appointment of Bush as President in 2000 as well as their judicial overreach going far beyond the issues in the case they had decided to accept in the declaration that corporations are people in Citizens United.

Beyond their unjudicial and biased decisions there is also the refusal of the Justices to Clarence Thomas' and Scalia's unethical behavior. Their refusal to act within judicial ethics rules also has weakened the Supreme Court's legitimacy. Most of America - progressive and conservative both - no longer consider the declarations of the nine justices anything more than just the pronouncements of another bunch of cheap politicians. Gingrich

Gingrich, as one of America's most notorious cheap politicians, has recognized all this self-inflicted weakness in the Supreme Court and has stepped in to take advantage of that fact. He is attacking the Supreme Court, and through it the entire American judicial system. Trust a nasty cheap politician like Gingrich to use the self-inflicted weakness of others to try to advance himself.

Unfortunately for Gingrich it won't help him. He simply displays his own lack of character as he attacks the Supreme Court. He offers no analysis or correction to the court. All he is doing is showing off his own (imagined) intelligence as well has his own inability to function effectively in government.

Ron Paul, failed Austrian economics, and the GOP

2011-12-16T15:00:00.003-06:00

Here's a lesson in Ron Paul's Austrian economics. Paul Krugman points out that Ron Paul has been consistently wrong in his economics, but that for some strange reason the GOP has decided to abandon its earlier good sense and join him in his pit of ignorance.

Mr. Paul identifies himself as a believer in “Austrian” economics — a doctrine that it goes without saying rejects John Maynard Keynes but is almost equally vehement in rejecting the ideas of Milton Friedman. For Austrians see “fiat money,” money that is just printed without being backed by gold, as the root of all economic evil, which means that they fiercely oppose the kind of monetary expansion Friedman claimed could have prevented the Great Depression — and which was actually carried out by Ben Bernanke this time around.

O.K., a brief digression: the Federal Reserve doesn’t actually print money (the Treasury does that). But the Fed does control the “monetary base,” the sum of bank reserves and currency in circulation. So when people talk about Mr. Bernanke printing money, what they really mean is that the Fed expanded the monetary base.

And there has, indeed, been a huge expansion of the monetary base. After Lehman Brothers fell, the Fed began lending large sums to banks as well as buying a wide range of other assets, in a (successful) attempt to stabilize financial markets, in the process adding large amounts to bank reserves. In the fall of 2010, the Fed began another round of purchases, in a less successful attempt to boost economic growth. The combined effect of these actions was that the monetary base more than tripled in size.

Austrians, and for that matter many right-leaning economists, were sure about what would happen as a result: There would be devastating inflation. One popular Austrian commentator who has advised Mr. Paul, Peter Schiff, even warned (on Glenn Beck’s TV show) of the possibility of Zimbabwe-style hyperinflation in the near future.

So here we are, three years later. How’s it going? Inflation has fluctuated, but, at the end of the day, consumer prices have risen just 4.5 percent, meaning an average annual inflation rate of only 1.5 percent. Who could have predicted that printing so much money would cause so little inflation? Well, I could. And did. And so did others who understood the Keynesian economics Mr. Paul reviles. But Mr. Paul’s supporters continue to claim, somehow, that he has been right about everything.

So the inflation that Austrian Economics predicts has not happened. Why not?

Because the world is in a massive recession. By definition that means there are unused capital goods and workers who cannot find jobs. Inflation occurs when too much money chases too few jobs in the market.

In that case the excess money has to compete with others who have money to buy capital goods. The competition drives the prices up - meaning competition for capital goods by people who need them and have money causes the price to rise. But prices are not rising. Why?

Because no one has any use for the unused capital goods. The problem is not excess money. The problem is insufficient demand. That means there is not enough consumption to drive businesses to obtain capital goods in the market. Generally they simply use what they have already. They also do not hire more workers, and since workers create 70% of all consumption, demand is not increasing. Without anticipated consumption to drive it, businesses will not invest in more capital goods and will not hire more workers.

Austrian Economics fails again. Ron Paul is, like most of the GOP leaders today, living in a fantasy world of his own making. The Austrian Economics/Libertarian fantasy is being pushed by wealthy individuals like to Koch Brothers through the CATO Institute primarily to weaken the power of the government over corporations, banks, and yes, wealthy families who would prefer to live in a plutocracy where they call all the shots.

Nikki Haley does Insurance industry bidding, damages people of Virginia, then lies about it.

2011-12-16T13:17:00.003-06:00

This is the Republican approach to health care policy.

Gov. Nikki Haley dictated the conclusions of a committee charged with deciding how the state should implement federal health care reform before the group ever held its first meeting, public documents show.

Now, some of those involved in the dozens of meetings are calling the entire planning process a sham that wasted their time and part of a $1 million federal grant.

In a March 31 email thread that included Haley, her top advisers and the committee member who eventually wrote the report, Haley wrote, "The whole point of this commission should be to figure out how to opt out and how to avoid a federal takeover, NOT create a state exchange," which is eventually what happened.

A central part of the federal health care overhaul, an exchange is a marketplace where various insurance plans eventually will be sold.

[...]

The most recent progress reports filed with the federal government show the administration used about $109,000 of the $1 million grant through the end of November.

Crangle said the exercise was "not in good faith" and called it "an abuse of federal funds." State money also is at issue because state employees were on state time when they attended dozens of exchange planning meetings, he said.

Sue Berkowitz, an advocate for the uninsured who participated in planning discussions as executive director of S.C. Appleseed Legal Justice Center, said time was wasted.

"We came together and sat down for a lot of meetings in good faith that we'd explore every option and discuss what is in the best interests of the state," she said. "I'm frustrated that we were being used for something that wasn't an open, transparent discussion."

[...]

Insurance exchanges are the state- or federally-run marketplaces where health coverage will be sold to individuals and small business employees beginning in 2014. They are a key part of the federal health law.

Envisioned as the "Expedia" for health insurance, exchanges are intended to make purchasing health care easier and more affordable by allowing customers to compare options side-by-side.

They also are intended to be the place where residents who make between 133 percent and 400 percent of the poverty level will apply for and collect federal tax credits to buy coverage.

A state panel established by Gov. Nikki Haley recommended last month the state should not manage its own exchange. If Haley accepts the recommendations, South Carolina will join a handful of other states that already have declined to set up exchanges.

States that do not set up exchanges by 2014 will be subject to federally run exchanges.

In short, Nikki Haley does not want a competitive market in health insurance. She is governor of Virginia in part to ensure that Virginians have to buy health insurance from an oligopoly that already exists and wants no competition.

Republicans Don’t Care About Deficits! They are a political club.

2011-12-14T15:13:00.005-06:00

Deficits? Republicans don't care about deficits. They are the ones who CREATED the deficits. Ezra Klein complains, Paul Krugman explains:

Ezra Klein:
There are two very different tax-policy conversations playing out in the Republican Party right now. In Washington, House Republicans are arguing with each other over how small of a temporary tax cut to give the middle class. Out on the primary trail, the Republican presidential candidates are arguing over how huge of a permanent tax cut to give the wealthy.

All of which leaves the Republican Party in an odd place: skeptical of a temporary tax cut for the middle class that carries a price tag in the low hundreds of billions of dollars and is fully paid for but apparently enthused over permanent tax cuts for the rich that cost trillions of dollars and aren’t paid for at all.
But it’s not odd at all, once you realize that the GOP is not now, and never has been (at least not since the 1970s) concerned about the deficit. All the fiscal posturing of the last couple of years has been about using the deficit as a club to smash the welfare state, with the secondary goal of frustrating any efforts on the part of the Obama administration to help the struggling economy.

The entire debate has been fake. If you don’t understand that, or can’t bring yourself to admit it, you’re missing the whole story.

Wall Street has sold America out!

2011-12-12T13:45:00.004-06:00

There is a real good set of reasons why the tea partiers and the Occupy Wall Street groups both think that the Wall Street banks consist largely of immoral criminals. Their behavior has clearly shown that they are. Here is Robert Reich describing the behavior of the banks:

Wall Street’s shenanigans have convinced a large portion of America that the economic game is rigged.

Yet capitalism depends on trust. Without trust, people avoid even sensible economic risks. They also begin trading in gray markets and black markets. They think that if the big guys cheat in big ways, they might as well begin cheating in small ways. And when they think the game is rigged, they’re easy prey for political demagogues with fast tongues and dumb ideas.

Tally up these costs and it’s a whopper.

Wall Street has blanketed America in a miasma of cynicism. Most Americans assume the reason the Street got its taxpayer-funded bailout without strings in the first place was because of its political clout. That must be why the banks didn’t have to renegotiate the mortgages of Americans – many of whom, because of the economic collapse brought on by the Street’s excesses, are still under water. Some are drowning.

That must be why taxpayers didn’t get equity stakes in the banks we bailed out – as Warren Buffet got when he bailed out Goldman Sachs. That means when the banks became profitable gain we didn’t get any of the upside gains; we just padded the Street’s downside risks.

The Street’s political clout must be why most top Wall Street executives who were bailed out by taxpayers still have their jobs, have still avoided prosecution, are still making vast fortunes – while tens of millions of average Americans continue to lose their jobs, their wages, their medical coverage, or their homes.

And why the Dodd-Frank bill was filled with loopholes big enough for Wall Street executives and traders to drive their ferrari’s through.

The cost of such cynicism has leeched deep into America, causing so much suspicion and anger that our politics has become a cauldron of rage. It’s found expression in Tea Partiers and Occupiers, and millions of others who think the people at the top have sold us out.

Wall Street has shown clearly that they cannot be trusted, but when someone tries to enforce regulations on them what do they do? They whine about how misunderstood they are. They are not misunderstood. They are the organized center of financial greed and immorality in the world.

Wall Street Bankers are responsible for the current economic problems because they created and sold “financial weapons of mass destruction.” They bought off the regulators with their K-Street lobbyists, and they have supported the libertarian conservative Republicans who have thwarted and stopped government regulation of bank trading and mergers.

Since the (bank-created) collapse of the Savings and Loan institutions in the 1980's commercial banks have been merging until there are now only about five really massive banks. These banks do not do much business with small businesses because such loans do not provide large profits. They instead compete with the financial trading banks like Goldman Sachs for trading profits, using the savings from commercial customers as the basis for their trades. Why not? It's a lot cheaper than borrowing money in the market, isn't it?

But along the way the banks have forgotten that people have to trust them to do business with them. If we express our lack of trust in the massive banks who don't give a shit what happens to us, then we become their enemy. Their enemies are people that the government they buy (see K-Street Lobbyists) is supposed to suppress. The bankers prefer to wield power rather than work to develop trust.

Bob Reich has the banker's number. The bankers have forgotten that they are not in the power business, they are in the trust business. And a lot of us have been burned and no longer trust them.

Smart bankers will push for stronger and more visible regulation. I doubt that there are very many smart bankers on Wall Street in positions of power within the banking structures.

Depression and Authoritarianism go together

2011-12-12T13:01:00.001-06:00

Paul Krugman is trying to warn us frogs that the water we sit in is heating up dangerously.

It’s time to start calling the current situation what it is: a depression. True, it’s not a full replay of the Great Depression, but that’s cold comfort. Unemployment in both America and Europe remains disastrously high. Leaders and institutions are increasingly discredited. And democratic values are under siege.

[...]

[In poorly understood Europe] The shared currency, which was supposed to bind nations together, has instead created an atmosphere of bitter acrimony.

Specifically, demands for ever-harsher austerity, with no offsetting effort to foster growth, have done double damage. They have failed as economic policy, worsening unemployment without restoring confidence; a Europe-wide recession now looks likely even if the immediate threat of financial crisis is contained. And they have created immense anger, with many Europeans furious at what is perceived, fairly or unfairly (or actually a bit of both), as a heavy-handed exercise of German power.

The results of this is a discreditation of democracy in Europe and a rise in the popularity of authoritarianism. Krugman describe several European examples, of which the following is one.

Right-wing populists are on the rise from Austria, where the Freedom Party (whose leader used to have neo-Nazi connections) runs neck-and-neck in the polls with established parties, to Finland, where the anti-immigrant True Finns party had a strong electoral showing last April. And these are rich countries whose economies have held up fairly well. Matters look even more ominous in the poorer nations of Central and Eastern Europe.

Essentially what has happened is that the bank-created economic disaster has destroyed the lives of a large number of Europeans and they want to know who to blame. But the banks are in charge of solving the economic problems, so they are demanding austerity solutions.

Austerity does not end a Depression. It never has and it never will. So things are getting worse as austerity is imposed by bank-advised governments.

As things get worse, the governments are being blamed. They are imposing the austerity, after all. Since the governments are failing, obviously they need to be changed. There are people out there saying "Give me control and I will fix the economy!" But they can't get control in the existing democracies. So the problem will be solved by eliminating democracy and putting those who promise solutions into control of government.

Welcome to authoritarianism! Will the new authoritarians when installed stop listening to the bankers who are demanding austerity "solutions"? Yeah, for a while anyway. But authoritarianism brings its own set of new problems with it.

This is a bit different from the set of economic problems here in America. Here we have a minority political party with discredited solutions to the very economic problems they themselves created who are using provisions of the Constitution to paralyze government in the face of those very problems that minority party created. The purpose of paralyzing the government is to force the American public to return the failed minority to power because they will not permit the government to act to solve problems while they are out of power.

The link between European problems and American problems is that the very banks which created the economic problems both national entities face are demanding that the governments install socially destructive and economically ineffective austerity "solutions" to fix the economic problems the banks created. The so-called solutions will actually do nothing more than shift wealth From the middle and working classes who create the wealth to the financial predators who make up much of the top 1% of the economic classes in both America and Europe.

If the bankers have to install authoritarian governments to get their way, they will not hesitate to do so.

Krugman's right. The problem has moved far beyond just a really severe recession. Both America and Europe are now in the early stages of another Depression, one which combines economic hardship with very strong threats to democracy.

Cats with Thumbs - Hell of a commercial

2011-12-11T23:28:00.001-06:00

This is good.

Up w/ Chris Hayes for 10/29/2011

2011-10-29T16:41:00.001-05:00

This is a really important clip from Up w/ Chris Hayes on October 29, 2011. The Occupy Wall Street rallies started out to be a response to the clear and extreme income inequality that has been allowed to develop in what used to be middle class America. But the unprovoked police brutality especially in Oakland, CA has clearly shown a lot of white, middle class demonstrators that they will be treated by the police as though they were criminal trash simply because they are identified as not wealthy.

Chris discusses this with his guests Heather McGhee (Demos.org) and Ta-Nehisi Coates (TheAtlantic.com) in the first ten minutes of the first segment of his Satarday show.

Visit msnbc.com for breaking news, world news, and news about the economy

This is the second hour of the same discussion.

Visit msnbc.com for breaking news, world news, and news about the economy

The Great Recession and the Failed Rule of Law

2011-10-26T16:46:00.003-05:00

These two segments of the Rachel Maddow show discuss the general American feeling that there is no longer a rule of law here in which everyone, from the President, from CEO's and from the wealthiest Americans, are held to the same standards of law as the rest of us are.

Visit msnbc.com for breaking news, world news, and news about the economy

Here Rachel Maddow interviews Glenn Greenwald about his new book "With Liberty and Justice for ~~all~~ Some."

Visit msnbc.com for breaking news, world news, and news about the economy

As Francis Fukuyama makes very clear in his new book The Origins of Political Order one of the key elements of modern states and nations is the legitimacy that is provided by the assurance that the Rule of Law applies to everyone, not just to the peons. Today the Occupy Wall Street movement is at its core a reaction to the belief that there is one set of laws for the 99% and another for the top 1%.

The core element of legitimacy of the American government has been the belief that the rule of law has applied to Americans. The fact is the financial collapse of 2008 and the lack of any investigation into the collapse and application of blame to the clearly guilty has made it clear that neither the American elites nor the American government actually operate under the rule of law any more. This may well be the most significant reason for the poor ratings currently given to Congress.

Unless the rule of law is brought back and the parties who caused the collapse of the economy are investigated and punished there is a strong likelihood that no party is going to be able to regain and keep control of the American federal government for any period of time. Blame and punishment is going to be more important to the survival of American institutions than the false stability provided by ignoring wrong-doing.

It should also be very clear that the conservative movement and the wealthy elites who created and funded it are directly responsible for the collapse of the American economy.

Addendum 5:04 PM CST
Check out this article on Rule of Law.

Republican elites practice politics as warfare, not bipartisanship

2011-10-26T12:28:00.004-05:00

The media is setting up a fiction that the Republican Party has pragmatic, rational elites with only an extremist fringe that makes a great deal of noise. This fits with the already existing media fiction that both parties have an extremist fringe but are essentially just alike. This existing fiction is the basis of the idea that there is a "centrist" position that, if only a few courageous politicians would stand up and support it then America could be governed by a bipartisan government that solved real problems.

This media-stoked deal of bipartisanship is a ridiculous fiction, of course. It has no basis in reality. But then the media itself has almost no basis in reality any more. Now Ed Kilgore, James Vega, and J. P. Green describe America's current political reality:

The most dangerous group of political extremists today is not the grass roots supporters of the Tea Party. It is the major sector of the Republican financial and ideological elite who have embraced the philosophy of “politics as warfare.”

[...]

Extremist political parties share a large number of common characteristics, one critical trait being a radically different conception of the role and purpose of the political party itself in a democratic society.

In the politics as warfare perspective a political party’s objective is defined as the conquest and seizure of power and not sincere collaboration in democratic governance. The party is viewed as a combat organization whose goal is to defeat an enemy, not a governing organization whose job is to faithfully represent the people who voted for it. Political debate and legislative maneuvering are seen not as the means to achieve ultimate compromise, but as forms of combat whose objective is total victory.

This basic conception of the role of political parties leads to the justification and use of two profoundly anti-democratic strategies.

First, in the politics as warfare perspective it is a legitimate strategy for a political party to paralyze the workings of government in order to prevent a democratically elected government of an opposing party from implementing the platform on which it was elected. In the politics as warfare perspective the extremist political party accepts no responsibility for stability—engineering the failure of the existing government is absolutely paramount and any negative consequences that may occur in the process represent a kind of “collateral damage” that must be accepted as inevitable in warfare.

Historically, the Republican Party never embraced this strategy at any time during the Democratic administrations of Truman, Kennedy or Carter. The strategy first made its appearance when Newt Gingrich engineered the shutdown of the government in 1994. After Obama’s election in 2008 the use of this “paralyze the government” tactic accelerated dramatically with the conversion of the filibuster into a minority veto of virtually all majoritysponsored legislation and a Republican bar to the huge numbers of judicial and administrative appointments. Previous generations of Republicans would have been scandalized by the notion of crippling the administration of justice by leaving courts grotesquely understaffed in order to prevent the appointment of individuals who did not strictly adhere to conservative orthodoxy.

The most dramatic escalation of this approach, however, occurred after the elections of 2010 and was reflected in the rejection of the very substantial reduction in federal spending that Obama offered the Republican house majority. Observers concurred that the deal was far more favorable to conservatives in terms of policy than the deal Ronald Reagan accepted in 1986 on tax reform or that Newt Gingrich accepted on welfare reform in 1995. But public statements by Republican leaders indicated that the deal was rejected in substantial part on the explicitly political grounds that any legislative agreement that produced a “victory” for Obama was unacceptable. In effect, the political objective of weakening the president had actually become a higher priority than the achievement of the most fundamental long-sought conservative policy goals.

It is almost impossible for anyone who does not remember previous eras of American politics to realize how extraordinary this transformation actually is. It would have been literally inconceivable to the Republican senators and congressmen of the 1950s and 1960s.

The second, even more directly and profoundly anti-democratic strategy that directly flows from the politics as warfare philosophy is the calculated attempt to disenfranchise likely pro-Democratic voters.

There were no systematic Republican initiatives to disenfranchise voters during the Nixon, Reagan or Gingrich eras. But after the 2008 elections Fox News began promulgating the notion that massive voter fraud had occurred. Fox News featured a video of two members of the New Black Panthers at a single polling site more than 100 times on its national programs, asserting that they had intimidated voters in order to insure Obama’s election.

Even after it was conclusively demonstrated2 that sworn eyewitness testimony had been intentionally falsified in order to fabricate this charge, Fox continued to air the accusations and to assert that they were the tip of the iceberg of similar incidents. In parallel, accusations were also made that massive numbers of fraudulent votes had been cast in the election. The result of these charges was a widespread grass-roots effort by local tea party groups to police polling places and record incidents of intimidation and fraudulent voting during the 2010 elections—an effort that produced not a single documented case anywhere in the country. Nonetheless, there is now a major, nationally coordinated and massively funded effort to prevent pro-Democratic constituencies from casting their ballots. TDS managing editor Ed Kilgore accurately summarized the situation as follows: Central Eyewitness Testimony.

In the wake of the 2010 elections, Republican governors and legislatures are engaging in a wave of restrictive voting legislation unlike anything this country has seen since the Voting Rights Act of 1965, which signaled the defeat of the South’s long effort to prevent universal suffrage. This wave of activism is too universal to be a coincidence, and too broad to reflect anything other than a general determination to restrict the franchise. Millions of voters are affected….

As Ari Berman explained in an excellent recent summary of these developments for Rolling Stone, restrictive legislation, which has been introduced in 38 states and enacted (so far) in at least 12, can be divided into four main categories: restrictions on voter registration drives by nonpartisan, nonprofit civic and advocacy groups; cutbacks in early voting opportunities; new, burdensome identification requirements for voting; and reinstitution of bans on voting by ex-felons.

While new voter ID laws have clearly been coordinated by the powerful conservative state legislative lobbying network ALEC (American Legislative Exchange Council), other initiatives have spread almost virally. Virtually all of these restrictions demonstrably target segments of the electorate—the very poor, African-Americans and Hispanics, college students, and organizations trying to register all of the above—that tend to vote for Democrats.

In previous decades large sectors of the Republican elite would have been extremely uncomfortable with such measures and a significant group would have been vocally critical. Today, however, there is literally not a single significant figure in the Republican universe who is publicly objecting. The overwhelming influence of Fox News and talk radio have converted the notions that Obama represents a threat as massive as the rise of Hitler did in Germany, and that massive voter fraud is occurring all across the country, into passionately held urban legends that Republican elites no longer dare—or indeed
even wish—to challenge.

There are two profoundly disturbing conclusions that must be faced: First, the paralysis of government and the disenfranchisement of citizens are not “business as usual” for American conservatism. They are not attempts to prevent or reverse the enactment of particular policies and bills to which conservatives object but are rather strategies that strike at the most basic institutions and operations of representative democracy itself. To put it bluntly, they are not the policies of conservatives—they are strategies of political extremism.

Second, these strategies are not the products of a disreputable fringe of grass roots conservative activists, but have been designed, executed, endorsed and financed by a major sector of the Republican and conservative financial and ideological elite. The extraordinary fact that there is no major group or individual within the Republican coalition vocally objecting to these measures, as would have occurred in the past, offers the most profoundly disturbing evidence imaginable of the widespread tacit approval by the Republican elite.

There is more in this very clear analysis of the collapse of American democratic politics.

It is my opinion that America has a new aristocracy - one I call the moneyed elite. It consists largely of extremely wealthy families who want their power and wealth to gain control of the federal government, along with the Wall Street banking elite who handle the money belonging to those wealthy elite, and the social group that provides top executives to the large American and multinational corporations. An especially important element of this is Newscorp because it is a multinational moneyed elite predator which, because of its multinational status can avoid much of the regulation that national governments attempt to apply to the moneyed elites.

The federal government has, since the Great Depression, regulated the moneyed elites and provided justice to the working and middle classes. It is this regulation that the moneyed elites wish to break. The takeover of the Republican Party by these elites and the application of the strategy of politics as warfare is their current effort to weaken the power of the federal government to control them.

Addendum 1:33 PM CST
Paul Krugman points to the extremism described above very, very clearly.

Progressives are atheistic socialists who want to impose Sharia law. Class warfare is evil; also, John Kerry is too rich. And so on.

The key to understanding this, I’d suggest, is that movement conservatism has become a closed, inward-looking universe in which you get points not by sounding reasonable to uncommitted outsiders — although there are a few designated pundits who play that role professionally — but by outdoing your fellow movement members in zeal.

It’s sort of reminiscent of Stalinists going after Trotskyites in the old days: the Trotskyites were left deviationists, and also saboteurs working for the Nazis. Didn’t propagandists feel silly saying all that? Not at all: in their universe, extremism in defense of the larger truth was no vice, and you literally couldn’t go too far.

Many members of the commentariat don’t want to face up to the fact that this is what American politics has become; they cling to the notion that there are gentlemanly elder statesmen on the right who would come to the fore if only Obama said the right words. But the fact is that nobody on that side of the political spectrum wants to or can make deals with the Islamic atheist anti-military warmonger in the White House.

Strap yourself in; this is not going to be fun.

I think - perhaps just hope - that the Occupy Wall Street movement is the first real indication that the mass American population has begun to awaken to the threat that the American conservative movement as it is now structured poses to American democracy and to American values.

Koch Brothers are mad at Rachel Maddow

2011-10-20T23:01:00.004-05:00

Here's the latest on the Koch brothers. They've gotten their feelings hurt.

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The flat tax is a failure

2011-10-20T22:50:00.001-05:00

This is Paul Krugman explaining.

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Pakistan, the US and Afghanistan - things are getting tough

2011-10-20T18:15:00.002-05:00

Pakistan is a weak nation, one in which the central government does not control all of its' assumed land area or all of its' internal institutions. The Pakistani Army is probably more powerful than the civilian government, and the Inter-services Intelligence (ISI) agency, ostensibly an agency of the Army, is very probably more powerful than either the civilian government or the Army itself. The Obama White House has rather clearly decided that the ISI obstructionism has gone on long enough.

(Reuters) - Secretary of State Hillary Clinton and top U.S. military and intelligence leaders delivered a tough warning to Pakistan on Thursday to cut suspected ties with militant groups which have upset relations between the uneasy allies.

Clinton led a heavyweight U.S. team at talks in Islamabad to

press Pakistani counterparts on U.S. accusations that Pakistan assists militants who launch attacks on both sides of the Afghan-Pakistan border and increasingly threaten U.S. interests.

"The meeting lasted for four hours. It was extremely frank, the discussion was very detailed," a senior U.S. official said after the meeting, adding that more discussions were planned for Friday.

The visit by Clinton, CIA director David Petraeus and the chairman of the Joint Chiefs of Staff, General Martin Dempsey, was a sign that Washington is determined to get its message across amid rising tensions among three key players in the Afghanistan war.

The meeting included Pakistani Prime Minister Yusuf Raza Gilani, the powerful army chief, General Ashfaq Kayani, and Lieutenant-General Ahmed Shuja Pasha, who heads the Inter-services Intelligence (ISI) agency which U.S. officials have singled out for its alleged support of militant groups.

Earlier on Thursday during a visit to Kabul, Clinton said it was time to send a "clear, unequivocal message" to Pakistan that it must step up efforts to broker an end to the decade-long war in Afghanistan and crack down on safe havens used by militants.

"They must be part of the solution and that means ridding their own country of terrorists who kill their own people and cross the border to kill in Afghanistan," Clinton said.

It's clear that Pakistan's cooperation is going to be necessary to resolve the US combat situation in Afghanistan, and the leaders of the ISI are aware of that. They are depending on that fact to keep the US from punishing Pakistan as a nation for the bad behavior of the ISI. The message from Secretary Clinton is clearly part of the process of ramping up the pressure on Pakistan.

All we are seeing is what each side is willing to tell the media. The US may be ramping up the pressure, but Pakistan has both India and China sitting on its borders threatening it. With those two nations as immediate threats, the US is going to have to really ramp up the pressure to even be noticed. So I do not envy Secretary Clinton in delivering the message that the US has had enough. I'm glad she is doing it, though. It is necessary.

La Nina in the Pacific assures drought in Texas

2011-10-20T17:19:00.004-05:00

For those of us living in Texas this is NOT good news. CNN offers this winter weather forecast.

Washington (CNN) -- The Southern Plains of the United States are likely to see a continuation of a severe drought this winter, while the Pacific Northwest will be colder and wetter than average, according to data released Thursday by the National Oceanic and Atmospheric Administration.

La Nina is expected to influence weather patterns across the country for the second year in a row. Weather officials say with La Nina in place, Texas, Oklahoma, New Mexico and other surrounding states are unlikely to get enough rain to alleviate the ongoing drought.

"Ninety-one percent of Texas, 87 percent of Oklahoma and 63 percent of New Mexico are experiencing extreme or exceptional drought," said David Brown, director of the Southern Region Climate Services based in Fort Worth, Texas.

Parts of Texas and Oklahoma are more than 30 inches below average in rainfall this year, with little in the forecast to predict the trend is going to change as the winter months approach.

It looks like I need to replace my st. Augustine grass lawn with cactus or something similar. Oh, and reduce my steak-based meals since the price of beef will continue to climb.

Note - this is a weather forecast, not a discussion of climate change. Weather is not climate.

A description of the current American civil war

2011-10-20T14:47:00.007-05:00

This comes from over at Hullabaloo. It is a clear summary of the current American political situation.

Progressives must come to terms with the fact that the 35% or so of Americans who make up the conservative base have been radicalized far beyond the point of no return. They are activist class warriors on behalf of the top 1% of "producers." They are activist culture warriors against minority communities who will happily advance minority figureheads as exceptional standardbearers in order to prove their point.

We are now a nation hopelessly divided. On one side is a large faction of people who understand that the financial classes and the super-wealthy are mostly a parasitic class; that the middle class has much more in common with the poor than it does with the wealthy; that workers produce wealth, and that demand produces prosperity; that poor communities are disadvantaged not by the inherent failings of their people but by the oppressive nature of their circumstances; and that we humans and creatures of this earth are all in the same boat together.

On the other side is a large group of people who believe that over half of Americans are parasitic dead weight who should not be allowed to vote; that the interests of the middle class are aligned with the interests of hedge fund managers; that only a select few very wealthy people produce society's goods; that poor communities are poor through their own moral failings; and that the society's "producers" should behave however they please to people and creatures unfortunate enough to find themselves at their mercy.

And in the middle are about 20% of Americans paying too little attention to have much of an opinion either way.

This is the "Two Tribes" Digby has been writing about for the last decade. I am going to write more about these two tribes in the near future but until I do, I strongly recommend Francis Fukuyama's new book The Origins of Political Order.

Fukuyama writes of the shift from tribal government to the national state. The national state is based on bureaucracy, which is an impersonal rational organizational structure of the type which is required to achieve control over large populations and especially to field large professional armies. Once a state exists, then history has shown it becomes unified when the king provides justice to the population and protects them from the predatory behavior of the aristocracy. But this protection only occurs in a strong state. A weak state cannot provide as much protection and cannot afford to field large professional armies over long periods of time.

Fukuyama describes the characteristics of tribally governed organizations and compares those characteristics of nation states which are based on bureaucracies. But he also points out that historically nation states have broken down, and when they do the default form of governance is tribal. The aristocrats prefer tribal governance because they are predators and such tribal governance allows them to plunder the population.

The aristocrats of France from three centuries ago are today's moneyed elites. Keep in mind that the working classes create value. The modern moneyed elites do nothing but collect rent without adding value to the society. Their rent is based on their positions of power, not on their economic value. Since the Great Depression the federal government has protected the working population of America from the predatory behavior of the moneyed elites, but with the rise of Reaganism that protection has broken down. Today Wall Street banks, large monopolistic or oligopolistic businesses and inherited wealth all conspire to weaken the federal government so that they can plunder the working population.

They are far along on their effort, but the Occupy Wall Street movement has begun to react to their predations. It's time for America to regain control over the financial predators who are attacking us.

Are the Tea Party and Occupy Wall Street very similar?

2011-10-20T13:56:00.003-05:00

Trust Digby to get it right.

I suppose it was inevitable that the burgeoning Occupy Wall Street movement would be compared with the Tea Party, but the level of misunderstanding and myth surrounding the latter's "populist" bona fides is surprising to even the most cynical observer.

There may be surface similarities between the two uprisings, but they actually represent two opposing populist worldviews, whose only philosophical resemblance to one another is their belief that they speak for "the people" against the elites. While both movements are mainly concerned with economic issues, their beliefs about the causes and solutions they propose couldn't be more different.

One of the central myths about the Tea Party is that it came about as a reaction against the Wall Street bailouts. It's true that there were some scattered "Tea Parties" around the Ron Paul campaign in 2008, but virtually everyone agrees that the movement was really galvanised by a famous rant from CNBC anchor Rick Santelli from the trading floor of the Chicago commodities exchange.

Only one month into the Obama administration, Santelli called for a "new Tea Party" to be held on tax day, April 15, and it became an instant YouTube sensation and rallying cry for the right wing.

He was mad about bailouts alright, but not the Wall Street bailouts. What sparked his fury was the proposed plan to help average homeowners in trouble with their mortgages. Santelli raved: "Do we really want to subsidise the losers' mortgages? This is America! How many of you people want to pay for your neighbour's mortgage? President Obama, are you listening? How about we all stop paying our mortgages! It's a moral hazard."

"Do we really want to subsidise the losers?"

- Rick Santelli, CNBC anchor

Here's how his colleague Lawrence Kudlow characterised the outburst: "Santelli called for a new Tea Party in support of capitalism. He's right."

Support for capitalism - and antipathy toward government interference in it - is the very essence of Tea Party populism. There wasn't much talk about the moral hazard of a "too big to fail" banking system but there was plenty of fulminating about government interference in "the market" and righteous anger about the stimulus plan and what they characterised as the "government takeover" of the healthcare system.

It was never about corporate greed, but was about the usual right wing resentment at the government spending their tax money on people they don't think have earned it. These are not billionaire bankers - they are the people on the lower rungs of the ladder. Unsurprisingly, this attitude turned out to be useful to corporate interests looking to allay any real populist impulses among the citizenry, and they soon moved in through various means to help the "movement" organise itself.

Contrary to various accounts surfacing lately ostensibly to warn the Occupy Wall Street supporters of the dangers of being similarly "co-opted" it was a very happy love match, not a marriage of convenience.

Occupy Wall Street, on the other hand, while being endlessly harrangued by wags and pundits about its alleged lack of goals and lists of grievances, is actually focused pretty clearly on the same thing as the populists of the Gilded Age - those whom Teddy Roosevelt called the "malefactors of great wealth".

Their rallying cry is "we are the 99 per cent" which represents the huge number of those of us who have been treading water or losing ground over the past 30 years, while and the upper one per cent of the population swallows up more and more of the nation's wealth. This shocking income inequality is finally reaching a critical mass that is animating the OWS movement.

Indifference of the rich

This movement wasn't catalysed by a wealthy commentator issuing a cri de guerre on a stock market show on TV. There has been a growing anti-corporate populist critique on the left for nearly 20 years, first in the form of the anti-globalisation movement and more recently in the more mainstream response to a series of assaults on workers' rights, notably in Wisconsin and Ohio.

The arrogant indifference of the very rich to the carnage they left behind in the wake of their spectacular meltdown in 2008, and the apparent impotence of democratic institutions to hold them to account, has finally mobilised the masses.

Click Here to read the rest.

Herman Cain will not accept the results of this experiment

2011-10-20T13:33:00.003-05:00

What if the government were to take some Black women from poor neighborhoods and move them to higher income neighborhoods, then ten years later determine whether the moved people had better health ten years later than did those left in the poor neighborhoods?

The experiment was tried. Women who were moved to better neighborhoods had significantly better health results, especially lower diabetes results and less extreme obesity. Why might that be?

the study was not designed to answer what it is about more affluent neighborhoods that would cause someone to be healthier. But the authors listed four theories:

_ The availability of healthier food is worse in lower-income neighborhoods.

_ Opportunities for physical exercise are scarcer, and fear of crime can make people afraid to jog or play in parks.

_ There may be fewer doctors' offices and other medical services.

_ The long-term stress of living in such an environment may alter the hormones that control weight.

The results are not based on personal decisions. They are based on environment. That does not mean that personal decisions are not a factor in obesity and diabetes, just that environment is also an important factor.

What's wrong with modern American retirement

2011-10-19T23:20:00.004-05:00

This is from Rachel Maddow on October 19, 2011.

This is the best quick explanation of what is wrong with modern retirement systems in America. We've been ripped off!

Part I

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Part II

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Great SNL skit

2011-10-18T15:48:00.003-05:00

This one is too good to pass up.

Do you think this skit bullies Rick Santorum? He does. Awww. Poor baby.

OK. This is from the Onion.

Man in Coma Enters GOP Race; Already Polling Ahead of Romney.

No news media tells the Truth quite as well at The Onion.

Compare the OWS demonstrators to the Tea Partiers; They each represent the elites fighting over Washington, D.C.

2011-10-10T13:53:00.004-05:00

Todd Gitlin explains the Occupy Wall Street movement - at least in part - in today's New York Times. He briefly states how the OWS movement resembles the early Tea Party movement. Both are rebellions against the domination of American politics by unelected elites who are out strictly for their own gain at the expense of the middle class - and in the case of the OWS, the working class.

Then he explains how the two movements differ - the Tea Partiers are a strongly hierarchical movement which finds the elites it follows are out of power.

The Tea Party, for all its apparent populism, revolves around a vision of power and how to attain it. Tea Partiers tend to be white, male, Republican, graying, married and comfortable; the political system once worked for them, and they think it can be made to do so again. They revile government, but they adore hierarchy and order.

The OWS individuals in contrast show:

Deep anger at grotesque inequities extends far beyond this one encampment; after all, a few handfuls of young activists do not have a monopoly on the fight against plutocracy. Revulsion in the face of a perverse economy is felt by many respectable people: unemployed, not yet unemployed, shakily employed and plain disgusted. A month from now, this movement, still busy being born, could look quite different.

And yet it remains true that the core of the movement, the (mostly young and white, skilled but jobless) people who started the “occupation” three weeks ago, consists of what right-wing critics call anarchists.

[...]

IN this recent incarnation, anarchism, for the most part, is not so much a theory of the absence of government, but a theory of self-organization, or direct democracy, as government. The idea is that you do not need institutions because the people, properly assembled, properly deliberating, even in one square block of Lower Manhattan, can regulate themselves.

[...]

This new protest style is more Rousseau than Marx. ... It likes government more than corporations, but its own style is hardly governmental. It tends to care about process more than results.

And oh, how it loves to talk. It is no surprise that it makes fervent use of the technologies of horizontal communication, of Facebook and Twitter, though the instinct predated — perhaps prefigured — those tools. Not coincidentally, this was also the spirit of the more or less leaderless, partyless revolutions of Tunisia and Egypt that are claimed as inspiration in Lower Manhattan. An “American Autumn” is their shot at an echo of the “Arab Spring.”

OCCUPY Wall Street, then, emanates from a culture — strictly speaking, a counterculture — that is diametrically opposed to Tea Party discipline. ... Such movements hope to remain forever under construction, fluid, unfixed. They slip laughingly through the nets of journalism, which prefers hard-and-fast answers to the question “What do you people want?”

[Can] ... the inchoate quality of the Occupy Wall Street movement ... continue[?] Probably not, since an evolving alliance demands concrete goals, strategies and compromises. But perhaps something of the initial free spirit can flourish. There is plenty of public sentiment to nourish it. It doesn’t take public opinion polls to detect American anger at the plutocracy and the impunity with which it lords it over the country.

The culture of anarchy is right about this: The corporate rich — those ostensible “job creators” who somehow haven’t gotten around to creating jobs — rule the Republican Party and much of the Democratic Party as well, having artfully arranged a mutual back-scratching society to enrich themselves. A refusal to compromise with this system, defined by its hierarchies of power and money, would be the current moment of anarchy’s great, lasting contribution.

Until now, fury at the plutocracy and the political class had found no channel to run in but the antigovernment fantasies of the Tea Party. Now it has dug a new channel. Anger does not move countries, but it moves movements — and movements, in turn, can move countries. To do that, movements need leverage. Even Archimedes needed a lever and a place to stand to move the world. When Zuccotti Park meets an aroused liberalism, the odd couple may not live happily ever after. But they can make a serious run at American dreams of “liberty and justice for all.”

I like Gitlin's distinctions between the OWS demonstrators and the tea partiers. Both are angry at the disaster the elites have heaped on America and on most Americans. One major difference between the two groups, as Todd Gitlin points out, is that the OWS are anarchists and the tea partiers deeply love hierarchy and order (even to the point of approaching fascism though they will never admit that.)

But another major distinction Gitlin does not discuss is the distinction between the groups of elites the two groups each oppose and support. The OWS is an organization in opposition to the Wall Street elite bankers and to the wealthiest families in America who are trying to carve out tax exemptions and regulation exemptions for themselves at the expense of the rest of the people in the economy. Add the top executives of the largest oligopoly and monopoly firms in America who want the same exemptions from taxes and regulations and who also want to destroy all workers' institutions starting with unions.

The "elites" the tea partiers oppose appear to be governments in general when not Republican dominated, unions, Democratic and Socialist politicians, Secular Humanists/Atheists/Muslims/etc., and intellectuals of all types, particularly those who claim that Global Warming exists, is largely man-made and is getting worse. They are also angry at government which rejects their desire to carry firearms anywhere and any time they wish. To a great extent the elites the Tea Partiers support caused the Great Recession which all Americans (except the wealthy elites themselves) currently are suffering from.

Where there appears to be a strong anarchist element in OWS, there is clearly a strong Libertarian element mixed with a strong Christian religious fundamentalist element in the Tea Partiers. Both strongly oppose certain elites. But the elites each oppose are quite different.

It's the battle between those elites which is behind the current paralysis in Washington, D.C. The two different groups of elites are battling over control of government and much of the battle is now centering over the refusal of the conservatives (for whom the tea partiers are surrogates) to let government function at all if they cannot control it. The level of dysfunction has clearly reached the point where political professionals on both sides are speaking out.

The differences between the demonstrators in the Occupy Wall Street movement and the Tea Partiers mirror the competing factions currently paralysing Washington, D.C. and preventing the government from functioning.

The run-up to the 2012 election is going to get very interesting. We've seen nothing yet.

More from Jesse LaGreca

2011-10-08T17:10:00.004-05:00

This guy has got his shit together!

FOX - Run the damned video!

or is FOX "Fair and Balanced like a thumb on the scales?"

Krugman on the Occupy Wall Street demonstrations

2011-10-07T17:13:00.003-05:00

Paul Krugman has written about the Occupy Wall Street Protests. Here's what he wrote:

What can we say about the protests? First things first: The protesters’ indictment of Wall Street as a destructive force, economically and politically, is completely right.

A weary cynicism, a belief that justice will never get served, has taken over much of our political debate — and, yes, I myself have sometimes succumbed. In the process, it has been easy to forget just how outrageous the story of our economic woes really is. So, in case you’ve forgotten, it was a play in three acts.

[I have reformatted what Krugman wrote into bullet points but this remains an exact verbatim quote.]

In the first act, bankers took advantage of deregulation to run wild (and pay themselves princely sums), inflating huge bubbles through reckless lending.
In the second act, the bubbles burst — but bankers were bailed out by taxpayers, with remarkably few strings attached, even as ordinary workers continued to suffer the consequences of the bankers’ sins.
And, in the third act, bankers showed their gratitude by turning on the people who had saved them, throwing their support — and the wealth they still possessed thanks to the bailouts — behind politicians who promised to keep their taxes low and dismantle the mild regulations erected in the aftermath of the crisis.
Given this history, how can you not applaud the protesters for finally taking a stand?

[...]

I, at least, am a lot more offended by the sight of exquisitely tailored plutocrats, who owe their continued wealth to government guarantees, whining that President Obama has said mean things about them than I am by the sight of ragtag young people denouncing consumerism.

Bear in mind, too, that experience has made it painfully clear that men in suits not only don’t have any monopoly on wisdom, they have very little wisdom to offer.

[...]

It would probably be helpful if protesters could agree on at least a few main policy changes they would like to see enacted. But we shouldn’t make too much of the lack of specifics. It’s clear what kinds of things the Occupy Wall Street demonstrators want, and it’s really the job of policy intellectuals and politicians to fill in the details.

Rich Yeselson, a veteran organizer and historian of social movements, has suggested that debt relief for working Americans become a central plank of the protests. I’ll second that, because such relief, in addition to serving economic justice, could do a lot to help the economy recover. I’d suggest that protesters also demand infrastructure investment — not more tax cuts — to help create jobs. Neither proposal is going to become law in the current political climate, but the whole point of the protests is to change that political climate.

And there are real political opportunities here. Not, of course, for today’s Republicans, who instinctively side with those Theodore Roosevelt-dubbed “malefactors of great wealth.” Mitt Romney, for example — who, by the way, probably pays less of his income in taxes than many middle-class Americans — was quick to condemn the protests as “class warfare.”

But Democrats are being given what amounts to a second chance. The Obama administration squandered a lot of potential good will early on by adopting banker-friendly policies that failed to deliver economic recovery even as bankers repaid the favor by turning on the president. Now, however, Mr. Obama’s party has a chance for a do-over. All it has to do is take these protests as seriously as they deserve to be taken.

There are a lot of people who are really angry/upset over the Wall Street Crisis of 2008 and its aftermath and who don't think anyone has done anything about it. That's the source of the nationwide anger at Wall Street and at the wealthy slackers who are refusing to do anything except exploit the less wealthy. The Occupy Wall Street demonstration is their expression, and it's beginning to have an effect.

When will the Wall Street criminals pay for their crimes?

2011-10-07T08:05:00.002-05:00

A new study is being reported on showing that Americans have the lowest opinion of Wall Street Banks and financial institutions in a long time. Lindsay Owens looks at how Americans perceive the honesty and ethical practices as trends over 40 years.

Recent scandals involving Wall Street banks and financial institutions, headed by some of the world's most well-paid managers, executives and analysts, have many Americans asking themselves whether this game is rigged. It is this sense of injustice, coupled with economic insecurity, that animates changes in Americans' attitudes toward Wall Street. It's not just a small number of Americans, those who are actually "occupying" Wall Street, who feel such injustice. That's just the tip of the iceberg.

[...]

Americans have never exactly loved Wall Street stockbrokers or bankers—but we certainly didn't always hate them. Why this increasing hostility? The answer is a "perfect storm" of financial turmoil and a series of major scandals on Wall Street.

[...]

According to ... Harris Interactive, the percent of Americans with a great deal of confidence in the people running Wall Street had already reached an all-time low of just 4 percent by February of 2009. These figures are not just a reflection of Americans' dissatisfaction with the size of their bank accounts — they also reflect the increasing belief that Wall Street is playing a game that only the bankers can win.

Economic hard times, such as global recessions, do tend to bring about small, but noticeable drops in the public's confidence in Wall Street, just as we might expect falling confidence in a military that is losing a war.

But when economic downturns coincide with major scandals, as in the savings and loan crisis of the late 1980s and early 1990s and our current dilemma, the biggest changes in public confidence result — changes that may have contributed to the protests we are seeing on Wall Street today. In other words, Americans really begin to get angry when there is evidence of systematic foul play.

To be sure, material hardships such as unemployment rates in the 9 percent range and the continuing high levels of foreclosures and bankruptcies undoubtedly set the stage for a public outcry. But this outcry has a distinctly moral tenor. The sentiments of the Occupy protestors holding signs reading "Blame Wall Street Greed," "People not Profits" and "Wall Street was the Real Weapons of Mass Destruction" certainly echo the wider American public's sense of moral indignation.

Just 26 percent of Americans in an April 2011 Harris poll thought the people working on Wall Street were "as honest and moral as other people" (for a point of comparison, the percentage was 51 in 1997). In that same poll, 67 percent of Americans agreed that "most people on Wall Street would be willing to break the law if they believed they could make a lot of money and get away with it."

It was perfectly obvious by 2009 to the public that the financial collapse that occurred in the fall of 2008 was the direct result of extreme and reckless risk-taking by Wall Street bankers. It soon became equally clear that those banks considered themselves too big to fail, so they had been free to take insane risks with other people's money. They would get the winnings and the American taxpayers would take the losses.

This was all clear to the Wall Street bankers long before the financial collapse they created. The accuracy of their beliefs became very clear when, after they were bailed out, not a single criminal case was brought against the criminal bankers who had created the disaster. Instead by 2010 their bonuses were reaching record levels never before seen, even as the world economy was struggling to dig out of the economic rubble those bankers left in their wake.

Is the "Occupy Wall Street" a social movement that expresses the anger of the rest of us who have watched those economic criminals commit their crimes and then skate without any retribution? No doubt. And if it is not effective then there will be another to follow until the Wall Street criminals pay for their crimes.

How does a social movement succeed? Hard, skilled work.

2011-10-05T10:00:00.003-05:00

Ezra Klein has posted an article by skilled organizer Rich Yeselson describing what is required to make a movement succeed. What it takes is meetings - meetings - meetings and more meetings along with the motivation to make the time to conduct the meetings. Here is a little more from the article which he entitles The Four Habits of highly successful social movements:

the work of skilled organizers;
the success of those organizers in getting people, once these events end, to meet over and over and over again;
whether or not the movement can promote public policy solutions that are organically linked to the quotidian lives of its supporters; and
the ability of liberalism’s infrastructure of intellectuals, writers, artists and professionals to expend an enormous amount of their cultural capital in support of the movement.

Anyone who wants to see the Occupy Wall Street Movement succeed needs to read this entire article.

Millionaires get richer, hiring drops. Where are the jobs being created?

2011-09-23T01:31:00.003-05:00

Here is an excellent short video giving the facts of job creation in America that is (NOT)being created by giving tax breaks to millionaires and billionaires. The video then goes into the political implications - with a quick dig at the inside the beltway inhabitants of America's version of Versailles.

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Two interesting comments from Greg Sargent

2011-09-21T14:30:00.005-05:00

Here are two interesting comments from Greg Sargent's Plum Line.

GOP leaders to Fed: Don’t act on economy: GOP leaders send a letter to the Fed chairman, urging him not to adopt any further stimulus to help the economy — on the grounds that more action could hurt it by weakening the dollar, even though many economists think a weakened dollar would be good for the country.

Ezra Klein sense a threat in the public pressure. Steve Benen suggests we’re seeing the latest sign of active GOP sabotage of the economy. And Matthew Yglesias says this should be the story of the day.
Obama is tanking among independents: All that said, there’s no sugar-coating the fact that Obama’s overall numbers are terrible with indys. A new McClatchy-Marist poll finds that indys plan to vote against him by a whopping 53 to 28.
This could be a referendum on the current economy, and Obama’s challenge is to change this by somehow leveraging the fact that indys approve of the actual fiscal policies he’s currently championing. Hence the newly aggressive approach.

So the Republicans, with nothing else to run on for 2012, are in the process of sabotaging the economy. Is there any doubt? They are doing it in public now. They aren't even trying to hide their efforts.

Well, apparently there is doubt among the independent voters. Remember that a major characteristic of "independent" voters is that they do not follow politics and have little in-depth information. They are probably reacting to the poor economy and blaming the President. Will they even hear of the letter from the Republican leadership to the Fed? If they do, will they understand what it means?

That reaction by the independent voters is exactly the one the Republican leadership is depending on.

Here's why Elizabeth Warren should be Senator

2011-09-21T13:50:00.004-05:00

Elizabeth Warren explains why society matters.

This partial transcript comes from Steve Benen.

Warren, after explaining some of the reasons for the nation’s deep fiscal hole, pointed to a more sensible approach to economic policy in general. “I hear all this, you know, ‘Well, this is class warfare, this is whatever,’” she said. “No. There is nobody in this country who got rich on his own. Nobody.

“You built a factory out there? Good for you. But I want to be clear: you moved your goods to market on the roads the rest of us paid for; you hired workers the rest of us paid to educate; you were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory, and hire someone to protect against this, because of the work the rest of us did.

“Now look, you built a factory and it turned into something terrific, or a great idea? God bless. Keep a big hunk of it. But part of the underlying social contract is you take a hunk of that and pay forward for the next kid who comes along.”

Another Rogue trader damages his bank.

2011-09-17T22:38:00.006-05:00

Swiss Bank UBS has lost an estimated $2 billion because one of their traders in London, Kweku Adoboli, "went rogue." Julia Felsenthal at Slate Magazine explains what a rogue trader is. But first, who is Kweku Adoboli?

Kweku Adoboli is a 31 year-old british trader for the Swiss bank UBS. He was born in Ghana 15 Sept. 1980 and attended Ackworth School, a highly regarded Quaker school located in the village of High Ackworth near Pontefract, West Yorkshire, England. After that he was accepted to the extremely competitive University of Nottingham where he studied computer science and management. He graduated from there in 2003. From his educational history is it clear that Adoboli is a very capable individual.

According to the Wall Street Journal:

Adoboli started at UBS in London as a trainee in March 2006, according to the Telegraph newspaper. On the LinkedIn profile, his title is listed as “Director ETF and Delta1 Trading at UBS Investment Bank.”

Investment banks’ Delta One operations trade securities that attempt to track an asset closely. Our Journal colleague Paul Sonne reported Adoboli has worked since 2006 in the European equities division of UBS, focusing on exchange-trading funds, or baskets of securities that aim to track a specific stock index or commodities.

The Slate Article describes how traders are supposed to deal with risk.

Every trader is allowed to take on a certain amount of risk, and if he wants to exceed that value he must get the permission of his supervisors. ("Risk" refers not to the amount of money invested but rather the amount one might expect to lose on a particular gamble given the best available estimate of the odds.) Traders are said to have gone rogue when they've either made investments that are too risky, or invested much more money than they're supposed to.

What did Adoboli do that went so wrong? It looks like he made some losing trades, then attempted to take riskier trades or larger trades that would cover his losses if he succeeded, but they also failed. Somehow UBS risk management system failed to identify the risks and their size, either because Adoboli concealed them or because the risk management system was inadequate. Here's more from Slate.

A starting employee at a bank like UBS might be allowed to take on risk measuring in the thousands, not millions, of dollars. As a trader gains experience—and demonstrates an ability to make a profit—his authorized risk would increase; a very senior person at a bank might even be permitted a billion dollars' worth of exposure. Nobody has reported just how much Adoboli had been trusted with, but the Wall Street Journal did report that he worked for an equities desk called Delta One that conducted relatively safe trades. Charges against Adoboli allege that he falsified accounting records going back to October 2008. That suggests he was hiding unauthorized losing investments for a long time, as opposed to making one gigantic, really bad bet.

It has been reported that UBS' internal controls did not recognize that Adoboli was conducting unauthorized trades. He handed himself into UBS and told them what he had done, and only then did they realize that UBS had lost approximately $2 billion on his trades.

Two earlier rogue traders were Nick Leeson and Jérôme Kerviel. These were traders who were conducting large numbers of trades, made losing trades and learned how to conceal those losing trades from their supervisors while they took increasing risks attempting to achieve an overall winning situation. Nick Leeson's trades bankrupted and destroyed the Barings Bank. Jérôme Kerviel was similar to Adoboli in that Kerveil was a junior trader in the Delta One financial products department of the French bank, Société Générale. Kerviel lost approximately €4.9 billion for the bank through his trading actions.

Kerviel has always claimed that his supervisors were aware of his trades and that he simply became the fall guy when the trades failed. Did the risk management systems really fail in all three of these cases? How much did managers really know about the trades before they were exposed?

The massive power of these big banks to damage the lives and livelihoods of billions of people has be been clear since they initiated the Great Depression, and again has been exposed by their disastrous actions which caused the mortgage fraud that led to the financial collapse of Wall Street in 2008. The unrestrained management of these massive institutions cannot be trusted. This is the message that the Wall Street protesters are highlighting this weekend.

This story begins with one more banking "rogue trader", but it highlights the real problem of rogue financial institutions themselves.

Addendum 9/20/11 @ 1:43 AM CDT
Here is One view on why Bank Reform has not stopped rogue traders.

The end of outsourcing for cheap labor

2011-09-15T11:31:00.002-05:00

Outsourcing to find cheap labor is becoming too expensive to survive as an economically viable business process. In the very near future businesses are going to be instead eliminating the costs of maintaining and controlling inventory, while managing distribution and long distance transportation. A major advantage will be sharply improved quality control. How is this going to happen? Products are going to be manufactured at or very close to the point of sale as they are sold.

A recent article in Forbes points out that the major advantage of long production lines of nearly identical products has been that the long production lines lower the cost of production per unit and allow the product to be sold more cheaply per unit. Lower labor costs have for a relatively short time been one way to get lower unit cost. In recent years, however, the transportation, distribution and inventory costs have climbed to where they more than eliminated the advantage of cheap labor for a great many products.

The recent history of mass production manufacturing has been largely about big companies which outsourced manufacturing to third world countries in order to exploit cheap labor and to escape the limitations of high-priced unionized labor in most industrial nations. This only works for companies which sell a uniformly identical product to large groups of people. The more each unit is changed, the less likely that the product can be made cheaply enough to be made a long distance from the customer and shipped in.

The new technologies which will eliminate most outsourcing for cheap labor are:

programmable subtractive tools, which carve shapes from raw materials. These include laser cutters (which cut flat sheets of wood, acrylic, metal, cardboard, and other light materials), computer numerical control (CNC) routers and milling machines (which use drills to produce three-dimensional shapes), and cutters that use plasma or water jets to shape material.
additive tools, which are primarily computer-controlled 3-D printers that build objects layer by layer, in a process known as fused deposition modeling. They work with a wide variety of materials: thermoplastics, ceramics, resins, glass, and powdered metals. Technically known as “additive rapid manufacturing” devices, 3-D printers also use lasers or electron beams to selectively shape the source material into its final form. Because additive devices require little setup time, they make possible the production of any quantity at the same cost per unit, and also allow easy, rapid switching between products. In some cases, a 3-D printer can fabricate in a single piece an object that would otherwise have to be manufactured in several parts and then assembled. And because it composes objects bit by bit, instead of carving them from larger blocks, additive manufacturing considerably reduces the waste of materials.

The article goes on to point out that this technology is in its infancy, but that it is developing rapidly. The author provides good advice on how businesses should prepare to take advantage of it. He does not consider the implications for the declining American middle class but those should be very important. A well-trained well-paid middle class labor force is going to be needed very near the point of sale. Not in Mexico and not in China, but right in America where the products are being bought and used.

If I were suggesting strategy for firms competing with Walmart, I would be looking at this set of technologies very closely. Walmart's big competitive advantage has been it's superior computer technology and the lower distribution costs that technology has permitted. But if the competitors can produce goods at the point of sale with no significant costs of distribution, greater variation in the products and greater control over quality ....

Remember the Republican hissy fit when Alan Grayson said their health care plan was "Let them die!"?

2011-09-13T14:27:00.006-05:00

Alan Grayson famously said on the floor of Congress that the Republican health care plan was to simply let the sick die. The quote is:

The Republican health care plan for America: “don’t get sick.” If you have insurance don’t get sick, if you don’t have insurance, don’t get sick; if you’re sick, don’t get sick. Just don’t get sick. … If you do get sick America, the Republican health care plan is this: “die quickly.”

The Republican response was "He can't say that about us!!"

Now we have both Ron Paul and the studio audience of conservative Republicans confirming Grayson's statement.

Here is a transcript of the question and of Ron Paul's full response.

An interesting exchange in tonight's CNN Republican debate was prompted by the question to Rep. Ron Paul, R-Tex., about who should pay for medical care of the uninsured.

"A healthy 30-year-old young man has a good job, makes a good living, but decides, you know what? I'm not going to spend $200 or $300 a month for health insurance because I'm healthy, I don't need it. But something terrible happens, all of a sudden he needs it. Who's going to pay if he goes into a coma, for example? Who pays for that?" asked host Wolf Blitzer.

Paul, a medical doctor, first responded by saying American society is primed to believe government would pay for it.

"Well, in a society that you accept welfarism and socialism, he expects the government to take care of him,' he said.

When pressed on the question, Paul responded: "That's what freedom is all about, taking your own risks," to applause from many tea party backers in the audience.

"But Congressman, are you saying that society should just let him die?" asked Blitzer, to which several voices in the audience cried out, "Yes!"

"No. I practiced medicine before we had Medicaid, in the early 1960s, when I got out of medical school. I practiced at Santa Rosa Hospital in San Antonio, and the churches took care of them. We never turned anybody away from the hospitals," said Paul to additional applause. "And we've given up on this whole concept that we might take care of ourselves and assume responsibility for ourselves. Our neighbors, our friends, our churches would do it. This whole idea, that's the reason the cost is so high. The cost is so high because they dump it on the government, it becomes a bureaucracy," he added.

This small exchange is the key to a major debate going on with regards to health care, both President Obama's health reform law and former Massachusetts Governor Mitt Romney's own health reform law that is under attack by his Republican opponents.

Congressman Paul is wrong to assume that "they" simply decided to dump indigent health care on the government and as a result the cost of health care shot up. The fact is that the cost of health care shot up so high that individual hospitals could not continue to bear the burden without help. The result of the increase in health care cost was that the government had to step in and save the hospitals from bankruptcy. Who should fund the costs of someone in a coma kept alive for years? Who should provide the funds to give someone chemotherapy for follicular lymphoma? That costs $50,000 to $60,000 per month for six or seven months, and if successful can provide a person with many years of productive life after that.

No hospital can handle those costs today without assistance, and employers cannot continue to bear the costs of the employer insurance and remain competitive in the international market against foreign employers who have a workforce ensured by their governments. One or two very expensive cases can bankrupt a hospital and shut it down, and there are no health insurers with a large enough risk pool to handle such cases on their own. If hospitals are to be reliably funded and not risk being closed down by one or a few very expensive cases they are going to have to go to the government for financial assistance. There is no other organization large enough to bear the costs of some modern health care treatments.

Apparently Dr. Paul's medical training did not include understanding of insurance principles.

Congressman Paul and the teabaggers live in the fantasy that America is still in the 1950's. Everything that has changed since then has been a mistake and should be erased. But in those days sulfa drugs were a brand new miracle, the only treatment for depression was psychotherapy or electroconvulsive shock treatment and a diagnosis of cancer was a death sentence. Yeah, I guess that hospitals could deal with telling most of their patients there was no cure for their illness and sending them home to die at low cost to the hospital. Medicine has changed. Apparently, though, Dr. Ron Paul's medicine has not changed.

No wonder Congressman Dr. Paul had to change careers and get into politics. There are no malpractice lawsuits for incompetence against Congressmen.

A short summary of the economy that ended the Bush administration

2011-09-09T10:57:00.005-05:00

Americans are ahistorical. They can't even remember what happened three years ago. [The failure of the so-called news media to honestly and accurately cover it doesn't help.] Here's an exception.

Rachel Maddow very clearly lays out the utter collapse of the American economy in the last two quarters of 2008 (the Bush administration) and shows the effects of the stimulus spending from Washington, D.C. in 2009. It's clear and it's short.

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The Republicans claim that the stimulus didn't work. It was not big enough to eliminate the Great Recession, but it stopped the collapse into Depression. Even as soon as December 2009 it was clear that more stimulus was needed - and Congress refused. Largely this was through the Republican use of the filibuster and threat of the filibuster in the Senate.

So remember, Obama knew in 2009 that more stimulus was needed and requested it in December 2009. The Republicans were already blocking it and the Republicans were guaranteeing that America would have more and worse recession. This is intentional. The Republicans are the party that is against any government action, and their calculation is that if they can cause the government to fail in dealing with the Great Recession, the Republicans will gain power and replace the Democrats.

Notice the end of the Maddow segment, though. The statistics from the Bush administration showed a half percent GDP decline in the third quarter of 2008 and a 3.8% decline in the fourth quarter. But those were preliminary statistics. When the final numbers came in it became clear that America had been headed for the Second Great Depression. [This starts at minute 4.0 in the clip] Instead of a 1/2 % shrinkage of the economy in the third quarter of 2008 it was actually 3.7% shrinkage. Instead of 3.7% shrinkage in the fourth quarter of 2008 the shrinkage was actually 8.9%. America was headed into the Second Great Depression very rapidly. Only the stimulus (which the lame duck Congress of 2008 failed to act on - no leadership from the vacationing George Bush) passed within a month of Obama's inauguration kept America in the world from falling into the most massive economic Depression the world had ever seen.

One other thing to remember is that both the Great Depression of the 1930's and the almost Second Great Depression which started in 2007 with the mortgage crisis were caused primarily by unregulated, ignorant, and corrupt self-dealing by the massive banks in Wall Street. By 2008 America's GDP consisted of 40% the economically unproductive banking activities. The banks were creating markets with massive risk in them and then selling insurance to investors and borrowers to protect them against that risk the banks had created. Only the unregulated insurance the banks were selling were not capable of protecting the overall banking system from the extreme risk the bankers were creating and taking on.

Banks, through their lending, create the money supply the productive economy requires in order to function. They had by 2008 slipped into what is called the Shadow Banking System (unregulated and unmeasured private banking) which dominated the world financial economy. No one in banking itself knew what was going on overall, and the bankers successfully forced the federal government to remove itself from the regulation business, allowing the creation of the Shadow Banking System.

That unregulated banking system created the economic collapse that everyone became suddenly aware of in September 2008.

America and the world are now struggling to recover from the financial collapse of 2008. Only the conservatives world-wide are using the methods of Herbert Hoover, methods clearly shown in the 1930's to make the economic problems worse.

In the 1930's the bankers did not understand what they were doing when they passed the Smoot-Hawley Tarrif Act. Today the Republican Party knows exactly what it is doing. It is exacerbating the set of American economic problems based on Republican political calculation that the public will blame Obama and the Democrats for the failure to get us out of the economic problems.

Republican Whoppers last night.

2011-09-07T23:49:00.003-05:00

Republicans simply cannot be trusted to tell the truth. Alex Wagner from the Huffington Post explains.

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Here's some more of the same:

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Rick Perry is lying about Social Security being a Ponzi scheme. At it's core Social Security Retirement is a term insurance plan in which the money paid in during the current year pays the benefits paid out the same year. That is exactly the same plan as term life insurance, and it is a financial model of the reality. The working people this year much provide sufficient goods and services to support all workers and all non-workers together. Remember, non-workers include non-working spouses, children, retired individuals and wealthy investors who don't do anything real for the economy.

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"The evolution controversy today is, I think, a Galileo moment," says Karl Giberson

2011-09-05T11:44:00.004-05:00

Some evangelicals are questioning whether it was ever possible that there was actually an Adam and an Eve who together were the ancestors of all humans.

...some conservative scholars are saying publicly that they can no longer believe the Genesis account. Asked how likely it is that we all descended from Adam and Eve, Dennis Venema, a biologist at Trinity Western University, replies: "That would be against all the genomic evidence that we've assembled over the last 20 years, so not likely at all."

Researching The Human Genome

Venema says there is no way we can be traced back to a single couple. He says with the mapping of the human genome, it's clear that modern humans emerged from other primates as a large population — long before the Genesis time frame of a few thousand years ago. And given the genetic variation of people today, he says scientists can't get that population size below 10,000 people at any time in our evolutionary history.

To get down to just two ancestors, Venema says, "You would have to postulate that there's been this absolutely astronomical mutation rate that has produced all these new variants in an incredibly short period of time. Those types of mutation rates are just not possible. It would mutate us out of existence."

Venema is a senior fellow at BioLogos Foundation, a Christian group that tries to reconcile faith and science. The group was founded by Francis Collins, an evangelical and the current head of the National Institutes of Health, who, because of his position, declined an interview.

And Venema is part of a growing cadre of Christian scholars who say they want their faith to come into the 21st century. Another one is John Schneider, who taught theology at Calvin College in Michigan until recently. He says it's time to face facts: There was no historical Adam and Eve, no serpent, no apple, no fall that toppled man from a state of innocence.

"Evolution makes it pretty clear that in nature, and in the moral experience of human beings, there never was any such paradise to be lost," Schneider says. "So Christians, I think, have a challenge, have a job on their hands to reformulate some of their tradition about human beginnings."

Has anyone mentioned this to Michelle Bachman or to "The Family?"

The best description of modern American politics yet written

2011-09-04T14:46:00.004-05:00

"As Hannah Arendt observed, a disciplined minority of totalitarians can use the instruments of democratic government to undermine democracy itself." This is quoted by Steve Benen this morning. He also adds:

There is one great overwhelming dilemma that dominates American politics in this early part of the 21st century. It is not the extent to which President Obama has failed to meet the expectations of the progressive base, though this matters. It is not the lazy, negligent, and incompetent establishment media, though this matters, too. The issue that should dominate the landscape is the radicalization of the modern Republican Party and the effects of having one of two major political parties descend into madness.

What brought Steve to write this? It is an article entitled "Goodbye to All That: Reflections of a GOP Operative Who Left the Cult" by long-time Republican Congressional staffer Mike Lofgren. Lofgreen recently retired after 28 years of working with Republicans on the Hill. Here are some excerpts:

Both parties are rotten - how could they not be, given the complete infestation of the political system by corporate money on a scale that now requires a presidential candidate to raise upwards of a billion dollars to be competitive in the general election? Both parties are captives to corporate loot. The main reason the Democrats' health care bill will be a budget buster once it fully phases in is the Democrats' rank capitulation to corporate interests - no single-payer system, in order to mollify the insurers; and no negotiation of drug prices, a craven surrender to Big Pharma.

But both parties are not rotten in quite the same way. The Democrats have their share of machine politicians, careerists, corporate bagmen, egomaniacs and kooks. Nothing, however, quite matches the modern GOP.

To those millions of Americans who have finally begun paying attention to politics and watched with exasperation the tragicomedy of the debt ceiling extension, it may have come as a shock that the Republican Party is so full of lunatics. To be sure, the party, like any political party on earth, has always had its share of crackpots, like Robert K. Dornan or William E. Dannemeyer. But the crackpot outliers of two decades ago have become the vital center today: Steve King, Michele Bachman (now a leading presidential candidate as well), Paul Broun, Patrick McHenry, Virginia Foxx, Louie Gohmert, Allen West. The Congressional directory now reads like a casebook of lunacy.

[...]

A couple of months ago, I retired; but I could see as early as last November that the Republican Party would use the debt limit vote, an otherwise routine legislative procedure that has been used 87 times since the end of World War II, in order to concoct an entirely artificial fiscal crisis. Then, they would use that fiscal crisis to get what they wanted, by literally holding the US and global economies as hostages.

[...]

Everyone knows that in a hostage situation, the reckless and amoral actor has the negotiating upper hand over the cautious and responsible actor because the latter is actually concerned about the life of the hostage, while the former does not care. This fact, which ought to be obvious, has nevertheless caused confusion among the professional pundit class, which is mostly still stuck in the Bob Dole era in terms of its orientation.

[...]

It should have been evident to clear-eyed observers that the Republican Party is becoming less and less like a traditional political party in a representative democracy and becoming more like an apocalyptic cult, or one of the intensely ideological authoritarian parties of 20th century Europe. This trend has several implications, none of them pleasant.

In his "Manual of Parliamentary Practice," Thomas Jefferson wrote that it is less important that every rule and custom of a legislature be absolutely justifiable in a theoretical sense, than that they should be generally acknowledged and honored by all parties. These include unwritten rules, customs and courtesies that lubricate the legislative machinery and keep governance a relatively civilized procedure. The US Senate has more complex procedural rules than any other legislative body in the world; many of these rules are contradictory, and on any given day, the Senate parliamentarian may issue a ruling that contradicts earlier rulings on analogous cases.

The only thing that can keep the Senate functioning is collegiality and good faith. During periods of political consensus, for instance, the World War II and early post-war eras, the Senate was a "high functioning" institution: filibusters were rare and the body was legislatively productive. Now, one can no more picture the current Senate producing the original Medicare Act than the old Supreme Soviet having legislated the Bill of Rights.

Far from being a rarity, virtually every bill, every nominee for Senate confirmation and every routine procedural motion is now subject to a Republican filibuster. Under the circumstances, it is no wonder that Washington is gridlocked: legislating has now become war minus the shooting, something one could have observed 80 years ago in the Reichstag of the Weimar Republic. As Hannah Arendt observed, a disciplined minority of totalitarians can use the instruments of democratic government to undermine democracy itself.

John P. Judis sums up the modern GOP this way:
"Over the last four decades, the Republican Party has transformed from a loyal opposition into an insurrectionary party that flouts the law when it is in the majority and threatens disorder when it is the minority. It is the party of Watergate and Iran-Contra, but also of the government shutdown in 1995 and the impeachment trial of 1999. If there is an earlier American precedent for today's Republican Party, it is the antebellum Southern Democrats of John Calhoun who threatened to nullify, or disregard, federal legislation they objected to and who later led the fight to secede from the union over slavery."
A couple of years ago, a Republican committee staff director told me candidly (and proudly) what the method was to all this obstruction and disruption. Should Republicans succeed in obstructing the Senate from doing its job, it would further lower Congress's generic favorability rating among the American people. By sabotaging the reputation of an institution of government, the party that is programmatically against government would come out the relative winner.

A deeply cynical tactic, to be sure, but a psychologically insightful one that plays on the weaknesses both of the voting public and the news media. There are tens of millions of low-information voters who hardly know which party controls which branch of government, let alone which party is pursuing a particular legislative tactic. These voters' confusion over who did what allows them to form the conclusion that "they are all crooks," and that "government is no good," further leading them to think, "a plague on both your houses" and "the parties are like two kids in a school yard." This ill-informed public cynicism, in its turn, further intensifies the long-term decline in public trust in government that has been taking place since the early 1960s - a distrust that has been stoked by Republican rhetoric at every turn ("Government is the problem," declared Ronald Reagan in 1980).

The media are also complicit in this phenomenon. Ever since the bifurcation of electronic media into a more or less respectable "hard news" segment and a rabidly ideological talk radio and cable TV political propaganda arm, the "respectable" media have been terrified of any criticism for perceived bias. Hence, they hew to the practice of false evenhandedness. Paul Krugman has skewered this tactic as being the "centrist cop-out." "I joked long ago," he says, "that if one party declared that the earth was flat, the headlines would read 'Views Differ on Shape of Planet.'"

[...]

This constant drizzle of "there the two parties go again!" stories out of the news bureaus, combined with the hazy confusion of low-information voters, means that the long-term Republican strategy of undermining confidence in our democratic institutions has reaped electoral dividends. The United States has nearly the lowest voter participation among Western democracies; this, again, is a consequence of the decline of trust in government institutions - if government is a racket and both parties are the same, why vote? And if the uninvolved middle declines to vote, it increases the electoral clout of a minority that is constantly being whipped into a lather by three hours daily of Rush Limbaugh or Fox News. There were only 44 million Republican voters in the 2010 mid-term elections, but they effectively canceled the political results of the election of President Obama by 69 million voters.

[...]

This tactic of inducing public distrust of government is not only cynical, it is schizophrenic. For people who profess to revere the Constitution, it is strange that they so caustically denigrate the very federal government that is the material expression of the principles embodied in that document. This is not to say that there is not some theoretical limit to the size or intrusiveness of government; I would be the first to say there are such limits, both fiscal and Constitutional. But most Republican officeholders seem strangely uninterested in the effective repeal of Fourth Amendment protections by the Patriot Act, the weakening of habeas corpus and self-incrimination protections in the public hysteria following 9/11 or the unpalatable fact that the United States has the largest incarcerated population of any country on earth. If anything, they would probably opt for more incarcerated persons, as imprisonment is a profit center for the prison privatization industry, which is itself a growth center for political contributions to these same politicians.[1] Instead, they prefer to rail against those government programs that actually help people. And when a program is too popular to attack directly, like Medicare or Social Security, they prefer to undermine it by feigning an agonized concern about the deficit. That concern, as we shall see, is largely fictitious.

[...]

I have joked in the past that the main administration policy that Republicans object to is Obama's policy of being black.[2] Among the GOP base, there is constant harping about somebody else, some "other," who is deliberately, assiduously and with malice aforethought subverting the Good, the True and the Beautiful: Subversives. Commies. Socialists. Ragheads. Secular humanists. Blacks. Fags. Feminazis. The list may change with the political needs of the moment, but they always seem to need a scapegoat to hate and fear.

It is not clear to me how many GOP officeholders believe this reactionary and paranoid claptrap. I would bet that most do not. But they cynically feed the worst instincts of their fearful and angry low-information political base with a nod and a wink.

[...]

I do not mean to place too much emphasis on racial animus in the GOP. While it surely exists, it is also a fact that Republicans think that no Democratic president could conceivably be legitimate.

Then he lets loose on the failures of the political Democrats. And he is dead right!

The reader may think that I am attributing Svengali-like powers to GOP operatives able to manipulate a zombie base to do their bidding. It is more complicated than that. Historical circumstances produced the raw material: the deindustrialization and financialization of America since about 1970 has spawned an increasingly downscale white middle class - without job security (or even without jobs), with pensions and health benefits evaporating and with their principal asset deflating in the collapse of the housing bubble. Their fears are not imaginary; their standard of living is shrinking.

What do the Democrats offer these people? Essentially nothing. Democratic Leadership Council-style "centrist" Democrats were among the biggest promoters of disastrous trade deals in the 1990s that outsourced jobs abroad: NAFTA, World Trade Organization, permanent most-favored-nation status for China. At the same time, the identity politics/lifestyle wing of the Democratic Party was seen as a too illegal immigrant-friendly by downscaled and outsourced whites.[3]

While Democrats temporized, or even dismissed the fears of the white working class as racist or nativist, Republicans went to work. To be sure, the business wing of the Republican Party consists of the most energetic outsourcers, wage cutters and hirers of sub-minimum wage immigrant labor to be found anywhere on the globe. But the faux-populist wing of the party, knowing the mental compartmentalization that occurs in most low-information voters, played on the fears of that same white working class to focus their anger on scapegoats that do no damage to corporations' bottom lines: instead of raising the minimum wage, let's build a wall on the Southern border (then hire a defense contractor to incompetently manage it). Instead of predatory bankers, it's evil Muslims. Or evil gays. Or evil abortionists.

How do they manage to do this? Because Democrats ceded the field. Above all, they do not understand language. Their initiatives are posed in impenetrable policy-speak: the Patient Protection and Affordable Care Act. The what? - can anyone even remember it? No wonder the pejorative "Obamacare" won out. Contrast that with the Republicans' Patriot Act. You're a patriot, aren't you? Does anyone at the GED level have a clue what a Stimulus Bill is supposed to be? Why didn't the White House call it the Jobs Bill and keep pounding on that theme?

You know that Social Security and Medicare are in jeopardy when even Democrats refer to them as entitlements. "Entitlement" has a negative sound in colloquial English: somebody who is "entitled" selfishly claims something he doesn't really deserve. Why not call them "earned benefits," which is what they are because we all contribute payroll taxes to fund them? That would never occur to the Democrats. Republicans don't make that mistake; they are relentlessly on message: it is never the "estate tax," it is the "death tax." Heaven forbid that the Walton family should give up one penny of its $86-billion fortune. All of that lucre is necessary to ensure that unions be kept out of Wal-Mart, that women employees not be promoted and that politicians be kept on a short leash.

It was not always thus. It would have been hard to find an uneducated farmer during the depression of the 1890s who did not have a very accurate idea about exactly which economic interests were shafting him. An unemployed worker in a breadline in 1932 would have felt little gratitude to the Rockefellers or the Mellons. But that is not the case in the present economic crisis. After a riot of unbridled greed such as the world has not seen since the conquistadors' looting expeditions and after an unprecedented broad and rapid transfer of wealth upward by Wall Street and its corporate satellites, where is the popular anger directed, at least as depicted in the media? At "Washington spending" - which has increased primarily to provide unemployment compensation, food stamps and Medicaid to those economically damaged by the previous decade's corporate saturnalia. Or the popular rage is harmlessly diverted against pseudo-issues: death panels, birtherism, gay marriage, abortion, and so on, none of which stands to dent the corporate bottom line in the slightest.

He then explains what really matters to the Republican Party of 2011. I list here only his three categories.

The GOP cares solely and exclusively about its rich contributors.The party has built a whole catechism on the protection and further enrichment of America's plutocracy. Their caterwauling about deficit and debt is so much eyewash to con the public.
They worship at the altar of Mars.While the me-too Democrats have set a horrible example of keeping up with the Joneses with respect to waging wars, they can never match GOP stalwarts such as John McCain or Lindsey Graham in their sheer, libidinous enthusiasm for invading other countries.
Give me that old time religion.>Pandering to fundamentalism is a full-time vocation in the GOP.

There is a lot more in this great article. And it is written by a man who has been on the inside with the Republican leadership for nearly thirty years.

Remember "a disciplined minority of totalitarians can use the instruments of democratic government to undermine democracy itself." This article explains how it is happening to America right now. It is a process of the Republicans attacking to destroy American democracy and the hapless Democrats simply failing to defend democracy when it is under attack.

2012 is going to be a pivotal election for America, probably one as important as the election in 1860.

DOJ files antitrust lawsuit to block AT&T and T-Mobile merger

2011-08-31T14:05:00.001-05:00

This is good news for America's wireless customers. The DOJ antitrust lawsuit would block a merger that would leave America's wireless customers facing only two suppliers.

The U.S. Department of Justice filed an antitrust lawsuit against AT&T on Wednesday seeking to block its $39 billion merger with T-Mobile.

The merger would create the largest wireless company in the United States, combining AT&T's 98 million customers with T-Mobile's 34 million users, for a total of 130 million subscribers. AT&T is currently the second-largest wireless company by number of subscribers, and T-Mobile is fourth.

The DOJ said the merger would lead to a situation in which just two companies -- the AT&T-T-Mobile combination and Verizon Wireless -- would dominate the mobile market. The new AT&T and Verizon would account for more than two-thirds of wireless subscribers and 78% of the wireless industry's revenues.

"We feel the combination of AT&T and T-Mobile would result in tens of millions of consumers across the U.S. facing higher prices, fewer choices, and lower quality products for wireless services," James Cole, deputy attorney general, said in a press conference Wednesday.

This proposed merger is clearly anti-competitive and not in the best interest of American wireless customers.

Obama to win in 2012

2011-08-31T13:00:00.001-05:00

Allan Lichtman, professor at the American University, has a thirteen element formula which has successfully predicted which party would win the Presidency each election since 1984. US News has published his prediction for 2012. Obama will win, he says. Combine this with Steve Benen's report this morning that Obama is going to propose a big jobs initiative force the Republicans to continue to expose their anti-middle class agenda the 2012 election already seems rather easily predicted.

Here are the thirteen elements with Lichtman's scoring:

Party mandate: After the midterm elections, the incumbent party holds more seats in the U.S. House of Representatives than it did after the previous midterm elections. Says Lichtman, “Even back in January 2010 when I first released my predictions, I was already counting on a significant loss.” Obama loses this key.
Contest: There is no serious contest for the incumbent party nomination. Says Lichtman on Obama’s unchallenged status, “I never thought there would be any serious contest against Barack Obama in the Democratic primary.” Obama wins this key.
Incumbency: The incumbent party candidate is the sitting president. Easy win here for Obama.
Third Party: There is no significant third party challenge. Obama wins this point.
Short term economy: The economy is not in recession during the election campaign. Here Lichtman declares an “undecided.”
Long-term economy: Real per capita economic growth during the term equals or exceeds mean growth during the previous two terms. Says Lichtman, “I discounted long term economy against Obama. Clearly we are in a recession.” Obama loses this key. [Read: Seven Ways Obama Can Gain Credibility on Jobs.]
Policy change: The incumbent administration effects major changes in national policy. “There have been major policy changes in this administration. We’ve seen the biggest stimulus in history and an complete overhaul of the healthcare system so I gave him policy change,” says the scholar. Another win for Obama.
Social unrest: There is no sustained social unrest during the term. Says Lichtman, “There wasn’t any social unrest when I made my predictions for 2012 and there still isn’t.” Obama wins a fifth key here.
Scandal: The incumbent administration is untainted by major scandal. “This administration has been squeaky clean. There’s nothing on scandal,” says Lichtman. Another Obama win.
Foreign/military failure: The incumbent administration suffers no major failure in foreign or military affairs. Says Lichtman, “We haven’t seen any major failure that resembles something like the Bay of Pigs and don’t foresee anything.” Obama wins again.
Foreign/military success: The incumbent administration achieves a major success in foreign or military affairs. “Since Osama bin Laden was found and killed, I think Obama has achieved military success.” Obama wins his eighth key.
Incumbent charisma: The incumbent party candidate is charismatic or a national hero. Explains Lichtman, “I did not give President Obama the incumbent charisma key. I counted it against him. He’s really led from behind. He didn’t really take the lead in the healthcare debate, he didn’t use his speaking ability to move the American people during the recession. He’s lost his ability to connect since the 2008 election.” Obama loses this key. [See political cartoons about President Obama.]
Challenger charisma: The challenging party candidate is not charismatic or a national hero. Says Lichtman, “We haven’t seen any candidate in the GOP who meets this criteria and probably won’t.” Obama wins, bringing his total to nine keys, three more than needed to win reelection.

It's quite a way in advance of the election, of course, but the Republicans' only power is their conservative and socially conservative base who will not permit their politicians to even try to run on policies which might defeat Obama. While no election can really be predicted this far in advance, something really significant would have to change to make this prediction wrong.

Miles Davis plays "So What"

2011-08-30T15:49:00.002-05:00

This is from Ezra Klein. It's both neat and good music combined:

Does the economy now need government stimulus or austerity?

2011-08-28T11:11:00.002-05:00

Is the current economic set of problems the result of Democratic policies as implemented by Obama, or is the economy sputtering because the Republicans who control the House of Representatives refuse are doing their free market fundamentalist austerity policies? David Shorr writes on that issue:

The heart of the Republican argument is the claim that government spending and taxation is "job-destroying" and otherwise harmful to the economy. Well, this view among Republicans (and sympathetic deficit-hawk Dems) put limits on the 2009 stimulus package and ruled out the possibility of a subsequent injection of stimulus. So if the economic disaster brought about by Bush policies wasn't proof enough, we are tragically getting another demonstration of what happens when free market fundamentalist policies win out over J.M. Keynes' time-tested, Great Depression-taming approach.

The real problem with Republican obstructionism isn't its rigid refusal to compromise or cynicism in wishing for the president's failure. What we have here is a grand experiment for our grand debate over government expenditure, regulation and the provision of public goods, i.e. whether they are necessities or threats for the economy. We should take the GOP at Grover Norquist and Ayn Rand's word; cuts in budgets and the public sector is the job- and prosperity-creating tonic for what ails our economy. Republicans have succeeded in sidelining the government and preventing it from propping up weak demand. It's not a stretch, therefore, to say this is the Republicans' economy -- not because of George Bush, but because of Paul Ryan, Michele Bachman, John Boehner, Mitch McConnell, Rand Paul, Mitt Romney, Tim Pawlenty, the Koch Brothers, Richard Viguerie...

The scorekeeper on this experiment can be considered to be the bond market. When the policies begin to work then businesses will begin to expand and they will need funds. Investors will invest in the companies and in the stock market rather than in the bond market. Demand for safe government bonds will drop, requiring bond issuers to offer higher interest rates.

In other words, low bond interest rates means that the economy is still doing poorly, higher bond interest rates will indicate that the economy is improving.

The Republican led charge into cutting government spending has resulted in the lowest bond interest rates since the 1950's. The markets are speaking very loudly. Why aren't the Republicans in the Congress listening? Or do they have other purposes rather than improving the American economy?

2012 Election has started - Repubs working to paralyze government

2011-08-27T17:55:00.001-05:00

The recent Pew poll clearly states two things - independents want Democrats to confront Republicans and Democrats are unhappy with Democratic leadership. The latest AP poll confirms this result, but also points to the fact that the public still blames the republicans for the Great Recession.

Essentially the Republicans are practicing a slow motion shutdown of the US government in order to prevent Obama from being able to claim any success as President. Yet even while holding the government hostage and shutting down as many government functions as they can get away with, the Republicans are trying to blame Obama for not getting things done.

The slow motion shutdown of government is an effort by the Republicans to conduct a political coup and retake the Presidency in 2012 even though the voters don't like them and disapprove of what they propose government does. Following the creation of a false crisis over the government debt that has damaged the financial markets worldwide while tying up the Congress and preventing it from acting to ameliorate the real jobs crisis. The Republicans will not permit the government they don't run to function. That is the message presented by House Majority Leader Eric Cantor When he told Brian Beutler that when Hurricane Irene hit his own Virginia Congressional District that he would hold the disaster relief that the government needs to provide hostage to force an equal amount of spending cuts from the rest of the federal budget.

So what does this have to do with the polls that show that the Republicans are unpopular but that Obama needs to lead? We know the Republicans are unpopular. THEY know they are unpopular. Why are they going out of their way to show why they are so unpopular? And why isn't Obama stepping up and leading America anyway?

It's a high-stakes gamble by the Republicans that the American voters will vote in 2012 based on the economic conditions in 2012 and blame Obama because he is the face of the federal government. The Republican leadership is betting that we voters will on average forget the crap the Republicans are pulling to prevent government from functioning and instead blame the guy who is in charge for the previous three years.

The Republicans can (possibly) make this work because the Constitution created a Presidential system with shared powers. The President can tell Congress what he wants to do, but nothing gets into the budget that does not have the approval of the leadership of House of Representatives - currently John Boehner (R - OH.) And John Boehner is currently be led by the nose by the extremist social conservatives who call themselves the tea party who were elected in the 2010 election. Hey! American voters can't blame the Republicans if they are being forced to cater to extremist crazies, can they? No, the Republicans are betting that the American voters in 2012 will blame the bad economic conditions (caused by Bush and the Republicans) on the man who cannot get the House of Representatives (under Republican leadership) to pass a budget that includes programs that will actually increase employment in America.

This Republican high-stakes gamble is based on the idea that the (illegitimate foreign-born Muslim Black) President Barak Obama has failed to make things better for the average Americans in spite of the total obstruction he faces from the Republican Party, FOX News, and Rush Limbaugh.

Why do I call it a high-stakes gamble for the Republicans? Because they are betting the future of their party on the ignorance, stupidity and short memory of the average American voter. The Republican Party is already at low levels of disapproval never before reached by an American national party in the history of approval/Disapproval polls. But they have 14 months until the 2012 election and they have control of an amazing propaganda machine here in America (centered on FOX and on the right-wing talk shows of the Limbaugh type.)

The Republicans are also depending on the fact that Obama's polls are not that great right now, either. Again, they think that their efforts to neuter the effectiveness of government between now and the election and their propaganda machine can together drive those polls much lower by the time of the election.

At lot of liberals/progressives/Democrats probably agree with the Republicans about how low Obama's polls are and will be at the time of the election. But what is happening is that the Obama White House is doing two things. First, they are not having Obama stand up, present major policies that he has to have passed, and draw the automatic fire that will come from the Republicans. Obama simply cannot champion any program because it will automatically be vetoed by the Republicans, even if it was one they previously championed themselves. Second, Obama is doing his job as President, especially in foreign policy. The death of Osama bin Laden (which Bush found so difficult that he publicly abandoned the effort) and the overthrow of Ghadaffi based on a NATO coalition that Obama put together have clearly demonstrated that Obama is doing his job extremely well when no obstructed by the Republicans.

There will be no jobs bills or anything else of significance getting through the Republicans in Congress before the 2102 election. The Republicans cannot afford to let Obama succeed in anything. As I have said, this is high-stakes for the Republicans. They are going to have to respond to Obama by getting even more extreme right-wing.

Obama's high-stakes gamble is that the voters will recognize that the Republicans are the source of American failure. Obama has been and continues to let them prove that.

So we see a pair of political high-stakes gambles being played out between now and the 2012 election. The Republicans are doing everything they can do both legislatively and propaganda-wise to stop Obama from succeeding as President and then blaming his for his failure, while Obama is doing everything he can do to govern effectively in spite of Republican obstruction and working to force the Republicans to expose their anti-American anti-governance policies to the voters.

If this were a high-stakes poker game being played on TV it would be fun to watch. As it is the results in 2012 may well determine if America continues as a major industrial and political power in the world in the 21st century or is reduced to a secondary nation run by self-centered wealthy corporate and banking thugs who finance a proto-fascist political system.

Tea Party exposed!

2011-08-25T23:30:00.003-05:00

The authors of the study on Religion in government and published American Grace have found who the tea partiers used to be. The results are somewhat surprising.

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Whoever has been advertising (Koch brothers and the FOX News Network) for the tea party has been selling a lie.

seven economic frauds - possibly innocent but still frauds

2011-08-25T20:41:00.004-05:00

The link refers to the book SEVEN DEADLY INNOCENT FRAUDS OF ECONOMIC POLICY by Warren Mosler. Here is a fast summary:

Seven deadly (yet perhaps innocent) frauds.

First,government finance is supposed to be similar to household finance:government needs to tax and borrow first before it can spend.

Second, today’s deficits burden our grandchildren with government debt.

Third, worse, deficits absorb today’s saving.

Fourth, SocialSecurity has promised pensions and healthcare that it will never be able to afford.

Fifth, the U.S. trade deficit reduces domestic employment and dangerously indebts Americans to the whims of foreigners - who might decide to cut off the supply of loans that we need.

Sixth, and related to fraud number three, we need savings to finance investment (so government budgets lead to less investment).

And, finally, higher budget deficits imply taxes will have to be higher in the future - adding to the burden on future taxpayers.

Mosler shows that whether or not these beliefs are innocent, they are most certainly wrong. Again, there might be some sort of economy in which they could be more-or-less correct. For example, in a nonmonetary economy, a farmer needs to save seed corn to ‘invest’ it in next year’s rop. On a gold standard, a government really does need to tax and borrow to ensure it can maintain a fixed exchange rate. And so on. But in the case of nonconvertible currency (in the sense that government does not promise to convert at a fixed exchange rate to precious metal or foreign currency), none of these myths holds. Each is a fraud.

The best reason to read this book is to ensure that you can recognize a fraud when you hear one. And in his clear and precise style. Mosler will introduce you to the correct paradign to develop an understanding of the world in which we actually live.”

Now comes Warren Mosler with a small book, setting out his reasoning on seven key issues. These relate to government deficits and debt, to the relation between public deficits and private savings, to that between savings and investment, to Social Security and to the trade deficit. Warren calls them “Seven Deadly Innocent Frauds” - taking up a phrase coined by my father as the title of his last book. Galbraith-the-elder would have been pleased.
The common thread tying these themes together is simplicity itself. It’s that modern money is a spreadsheet! It works by computer! When government spends or lends, it does so by adding numbers to private bank accounts. When it taxes, it marks those same accounts down. When it borrows, it shifts funds from a demand deposit (called a reserve account) to savings (called a securities account). And that for practical purposes is all there is. The money government spends doesn’t come from anywhere, and it doesn’t cost anything to produce. The government therefore cannot run out.
Money is created by government spending (or by bank loans, which create deposits). Taxes serve to make us want that money - we need it in order to pay the taxes. And they help regulate total spending, so that we don’t have more total spending than we have goods available at current prices - something that would force up prices and cause inflation. But taxes aren’t needed in advance of spending - and could hardly be, since before the government spends there is no money to tax.

A government borrowing in its own currency need never default on its debts; paying them is simply a matter of adding the interest to the bank accounts of the bond holders. A government can only decide to default – an act of financial suicide – or (in the case of a government borrowing in a currency it doesn’t control) be forced to default by its bankers. But a U.S. bank will always cash a check issued by the US

Government, whatever happens.

Nor is the public debt a burden on the future. How could it be? Everything produced in the future will be consumed in the future. How much will be produced depends on how productive the economy is at that time. This has nothing to do with the public debt today; a higher public debt today does not reduce future production - and if it motivates wise use of resources today, it may increase the productivity of the economy in the future.

Public deficits increase financial private savings - as a matter of accounting, dollar for dollar. Imports are a benefit, exports a cost. We do not borrow from China to finance our consumption: the borrowing that finances an import from China is done by a U.S. consumer at a U.S. bank. Social Security privatization would just reshuffle the ownership of stocks and bonds in the economy – transferring risky assets to seniors and safer ones to the wealthy – without having any other economic effects. The Federal Reserve sets interest rates where it wants.

All these are among the simple principles set out in this small book.

The book is a pdf of 63 pages, the first two of which are blank. Be sure you go down to the start of the document.

Rick Perry's political donors and what he gives them if they donate to him

2011-08-19T15:59:00.003-05:00

Who are Rick Perry's biggest donors? Can America afford to bring Rick Perry into striking range of becoming President?

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Rick Perry has been selling off Texas government to make sure that he has the money he needs to run for office. Corrupt? Crooked? Yeah, what else is new? Perry is a Texas Republican and the governor.

Rick Perry is not stupid. He is a farm boy who is quite shrewd at getting what he wants and at selling his services. But he is governor of a state (Texas) which does not require any significant work from the governor (the state constitution was written right after Reconstruction to prevent carpetbaggers from controlling the state) and Perry has not demonstrated much knowledge of when the government really should do.

Fear is what FOX News sells. Roger Ailes is FOX News.

2011-08-18T08:40:00.004-05:00

As we get reports of the criminal organization operating as a News of the World in Great Britain and learn how it has determined to a large extent who runs the British government - often by publishing information obtained by illegal hacking - we in America should look at the American head of the same hydra - FOX News. The Guardian has prepared an excellent article on FOX which AlterNet has posted. Here are some excerpts.

The key to decoding Fox News isn't hosts Bill O'Reilly or Sean Hannity. It isn't even News Corp chief Rupert Murdoch. To understand what drives Fox News, and what its true purpose is, you must first understand Chairman Ailes. "He is Fox News," says Jane Hall, a Fox commentator for 10 years, who defected over Ailes's embrace of the fear-mongering Glenn Beck. "It's his vision. It's a reflection of him."

Ailes runs the most profitable – and therefore least accountable – head of the News Corp hydra. Fox News reaped an estimated profit of $816m last year – nearly a fifth of Murdoch's global haul. The cable channel's earnings rivalled those of News Corp's entire film division, which includes 20th Century Fox, and helped offset a slump at Murdoch's beloved newspapers unit, which took a $3bn writedown after acquiring the Wall Street Journal. With its bare-bones newsgathering operation – Fox News has one-third of the staff and 30 fewer bureaus than CNN – Ailes generates profit margins above 50%. Nearly half comes from advertising and the rest is fees from cable companies. Fox News now reaches 100m households, attracting more viewers than all other cable news outlets combined, and Ailes aims for his network to "throw off a billion in profits".

The outsize success of Fox News gives Ailes a free hand to shape the network in his own image. "Murdoch has almost no involvement with it at all," says Michael Wolff, who spent nine months embedded at News Corp researching a biography of the Australian media giant. "People are afraid of Roger. Murdoch is, himself, afraid of Roger. He has amassed enormous power within the company – and within the country – from the success of Fox News."

[...]

The Obama era has spurred sharp changes in the character and tone of Fox News. "Obama's election has driven Fox to be more of a political campaign than it ever was before," says Burns, the network's former media critic. "Things shifted," agrees Jane Hall, who fled the network after a decade as a liberal commentator. "There seemed suddenly to be less of a need to have a range of opinion. I began to feel uncomfortable."

Most striking, Ailes hired Glenn Beck away from CNN and set him loose on the White House. During his contract negotiations, Beck recounted, Ailes confided that Fox News was dedicating itself to impeding the Obama administration. "I see this as the Alamo," Ailes declared. Leading the charge were the ragtag members of the Tea Party uprising, which Fox News propelled into a nationwide movement. In the buildup to the initial protests on 15 April 2009, the network went so far as to actually co-brand the rallies as "FNC Tax Day Tea Parties."

According to recent polls, Fox News viewers are the most misinformed of all news consumers. They are 12 percentage points more likely to believe the stimulus package caused job losses, 17 points more likely to believe Muslims want to establish Sharia law in America, 30 points more likely to say that scientists dispute global warming, and 31 points more likely to doubt President Obama's citizenship. At the height of the healthcare debate, more than two-thirds of Fox News viewers were convinced Obamacare would lead to a "government takeover", provide healthcare to illegal immigrants, pay for abortions and let the government decide when to pull the plug on grandma. In fact, a study by the University of Maryland revealed that ignorance of Fox viewers actually increases the longer they watch the network. That's because Ailes isn't interested in providing people with information, or even a balanced range of perspectives. Like his political mentor, Richard Nixon, Ailes traffics in the emotions of victimisation.

"What Nixon did – and what Ailes does today in the age of Obama – is unravel and rewire one of the most powerful of human emotions: shame," says Perlstein, the author of Nixonland. "He takes the shame of people who feel that they are being looked down on, and he mobilises it for political purposes. Roger Ailes is a direct link between the Nixonian politics of resentment and Sarah Palin's politics of resentment. He's the golden thread."

Fox News stands as the culmination of everything Ailes tried to do for Nixon back in 1968. He has created a vast stage set, designed to resemble an actual news network, that is literally hard-wired into the homes of millions of America's most conservative voters. Republican candidates then use that forum to communicate directly to their base, bypassing the professional journalists Ailes once denounced as "matadors" who want to "tear down the social order" with their "elitist, horse-dung, socialist thinking". Ironically, it is Ailes who has built the most formidable propaganda machine ever seen outside of the Communist bloc, pioneering a business model that effectively monetises conservative politics through its relentless focus on the bottom line. "I'm not in politics," Ailes recently boasted. "I'm in ratings. We're winning."

The only thing that remains to be seen is whether Ailes can have it both ways: reaching his goal of $1bn in annual profits while simultaneously dethroning Obama with one of his candidate-employees. Either way, he has put the Republican party on his payroll and forced it to remake itself around his image. Ailes is the Chairman, and the conservative movement now reports to him. "Republicans originally thought that Fox worked for us," said David Frum, the former Bush speechwriter. "Now we're discovering that we work for Fox."

Roger Aisles is working to be the kingmaker here in America. To do it he has coarsened American politics and made it much less responsive to the needs and desires of Americans.

FOX News and Roger Aisles are a cancer in America's belly and need to be recognized and dealt with. If that is done, perhaps the Republican Party can recover to some extent and once again become a serious American political party.

How Rick Perry funds his election campaigns

2011-08-17T20:09:00.002-05:00

Want to know how Rick Perry raises money to run for office? Here's the story written by Ben Adler and published by The Nation.

One of Texas Governor Rick Perry’s oft-touted strengths in the Republican primary is his demonstrated prowess at fundraising. Less widely known is how he has raised that money and what he has done in return for it. According to Texas good government and environmental watchdogs, Perry has raised much of his campaign funds from business executives who have financial interests in state government decisions. Often Perry’s supporters come from the energy sector and Perry’s help for them has come at the expense of the environment.

Over his three campaigns for governor Perry raised a remarkable $102 million. Perry’s predecessor, George W. Bush, who was no slouch at fundraising himself, brought in $41 million over two campaigns.

Half of Perry’s haul, $51 million, has come from just 204 sources. Some are political action committees, but most are wealthy individuals. “He relies on a relatively small network of very big hitters, wealthy businessmen and their spouses who want something out of Texas government,” says Craig McDonald, director of Texans for Public Justice, a nonprofit research group that tracks the influence of money in Texas politics. As the Dallas Morning News reported during Perry’s re-election bid last year, “Perry tapped scores of big-dollar donors—including some who have business before the state or have benefited from taxpayer subsidies,” to vastly outraise his Democratic opponent, Bill White.

Perry rewards those who make sizeable contributions with appointments and political favors. He also works hard to do what his contributores want him to do. His seond largest all time donor is the owner of a nuclear waste dump, Harold Simmons.

Perry led the charge in 2010, while Simmons gave hundreds of thousands of dollars to Perry’s re-election campaign, to allow Simmons to import nuclear waste from thirty-eight states. On June 27 of this year, ten days after Perry signed the legislation, Simmons gave $100,000 to Americans for Rick Perry. Tom Smith, director of Public Citizen’s Texas office, estimates that the rule change will bring upward of $2 billion for Simmons. “If you put money in Perry’s purse, he’ll create policies you need,” says Smith.

Perry has been similarly accommodating of various other energy interests in the state. Texas has violated the Clean Air Act by allowing industrial plants such as oil refineries to reduce emissions overall rather than at each emissions point. When the Environmental Protection Agency informed Texas that they would have to take over Clean Air Act implementation in the state, Perry complained. “Perry’s on the cutting edge of this whole ‘job-killing EPA’ strategy that Republicans have used,” says Smith. There’s a saying Texas, according to Smith that “it’s cheaper to invest in politicians than in pollution controls.” Perry has been similarly critical of the EPA’s efforts to regulate greenhouse gases nationally.

Perry has been carrying water for environmentally destructive industries since his days in the Texas legislature. Back then, in the late 1980s, he led efforts to prevent species such as the golden cheek warbler from being listed as endangered, because their habitats in West Texas were threatened by suburban sprawl. Developers feared that they would be unable to pave over sensitive lands. Perry’s all-time biggest donor is home builder Bob Perry (no relation).

Essentially Rick Perry is owned by Bob Perry, Harold Simmons, and a few similar very wealthy individuals. Rick Perry has been happy to sell the health and economic well-being of Texans to these people.

Now those same people want to buy the government of the United States. That's why Rick Perry is running for President.

Religion in Politics

2011-08-17T01:30:00.002-05:00

Really, when you listen to Michelle Bachmann and Rick Perry wrap themselves in god for their political audiences, don't they sound desperate? Here is one view.

Visit msnbc.com for breaking news, world news, and news about the economy

The London riots are a political statement

2011-08-16T18:25:00.003-05:00

Here's Naomi Klein's view on the British riots:

I keep hearing comparisons between the London riots and riots in other European cities—window smashing in Athens, or car bonfires in Paris. And there are parallels, to be sure: a spark set by police violence, a generation that feels forgotten.

But those events were marked by mass destruction; the looting was minor. There have, however, been other mass lootings in recent years, and perhaps we should talk about them too. There was Baghdad in the aftermath of the US invasion—a frenzy of arson and looting that emptied libraries and museums. The factories got hit too. In 2004 I visited one that used to make refrigerators. Its workers had stripped it of everything valuable, then torched it so thoroughly that the warehouse was a sculpture of buckled sheet metal.

Back then the people on cable news thought looting was highly political. They said this is what happens when a regime has no legitimacy in the eyes of the people. After watching for so long as Saddam and his sons helped themselves to whatever and whomever they wanted, many regular Iraqis felt they had earned the right to take a few things for themselves. But London isn’t Baghdad, and British Prime Minister David Cameron is hardly Saddam, so surely there is nothing to learn there.

How about a democratic example then? Argentina, circa 2001. The economy was in freefall and thousands of people living in rough neighborhoods (which had been thriving manufacturing zones before the neoliberal era) stormed foreign-owned superstores. They came out pushing shopping carts overflowing with the goods they could no longer afford—clothes, electronics, meat. The government called a “state of siege” to restore order; the people didn’t like that and overthrew the government.

Argentina’s mass looting was called El Saqueo—the sacking. That was politically significant because it was the very same word used to describe what that country’s elites had done by selling off the country’s national assets in flagrantly corrupt privatization deals, hiding their money offshore, then passing on the bill to the people with a brutal austerity package. Argentines understood that the saqueo of the shopping centers would not have happened without the bigger saqueo of the country, and that the real gangsters were the ones in charge.

But England is not Latin America, and its riots are not political, or so we keep hearing. They are just about lawless kids taking advantage of a situation to take what isn’t theirs. And British society, Cameron tells us, abhors that kind of behavior.

This is said in all seriousness. As if the massive bank bailouts never happened.

There's more at the link. It would take a conservative to try to claim that there was no basis for the riots in the conservative austerity cuts. Sometimes the only speech that the oppressed poor can conduct that gets media attention involves fire, theft and violence. As in Argentina, the wealthy sacked the country first and now the conservatives want to be left alone with the political power to enjoy the fruits of el saqueo.

LA Times stories on the Sinaloa Cartel

2011-08-16T15:38:00.002-05:00

Several good articles by Richard Marosi from the LA Times on the Sinaloa drug Cartel.

Unraveling Mexico's Sinaloa drug cartel 1 of 4 - 7/24/11

The strands of the Sinaloa drug cartel web 2 of 4 - 7/26/11

Flying high for the Sinaloa drug cartel 3 of 4 - 7/27/11

Suspicion in Mexico's Sinaloa cartel 4 of 4 - 7/28/11

One Mexico border city is quiet, maybe too quiet Earlier story - 9/16/2009

"Debt Crisis" was actually long-planned power grab by conservative Republicans

2011-08-16T10:33:00.004-05:00

The Washington Post recently published a well-researched article which clearly establishes that the so-called "Debt Crisis" which resulted in the S&P downgrade of US treasury debt is the direct result of a long-term plan ram-rodded by Eric Cantor recover the power the Republican Party lost under the Bush administration.

This was not the tea partiers-gone-wild. This was not the Republicans reacting to disaffected voters as a result of the poor economy. It started before the economic collapse in fall of 2008 but was intended to take advantage of the economic conditions. This has been a long-term centrally-coordinated power grab by the national conservative Republicans.

This article was reported by Lori Montgomery, Paul Kane, Brady Dennis, Alec MacGillis, David Fahrenthold, Rosalind Helderman, Felicia Sonmez and Dan Balz. It was written by Dennis, MacGillis and Montgomery.

In mid-January, newly installed as the GOP House majority leader, Virginia’s Eric Cantor rose to the podium inside a spacious hotel ballroom to deliver a message to his troops, including the 87 newcomers who had given the party control of the House.

A vote to increase the nation’s $14.3 trillion debt limit was coming soon, he told the caucus members who had gathered at the Marriott in Baltimore’s Inner Harbor for a closed-door retreat less than 10 days after taking power. Think of it as a “hidden” opportunity, he implored them, a chance to achieve their goal of reining in the federal government and its spending habits.

“I’m asking you to look at a potential increase in the debt limit as a leverage moment when the White House and President Obama will have to deal with us,” said Cantor, one of several new House leaders who detailed the game plan for the coming months. “Either we stick together and demonstrate that we’re a team that will fight for and stand by our principles, or we will lose that leverage.”

The frantic showdown that followed, bringing the nation to the brink of default, looked like the haphazard escalation of a typical partisan standoff.

It wasn’t.

It was the natural outgrowth of a years-long effort by GOP recruiters to build a new majority and reverse the party’s fortunes. That effort began before the economy collapsed in 2008, before the government bailouts that followed, before the tea party rose in response to push its anti-tax, anti-spending message.

With the backing of the GOP establishment, Cantor and two colleagues banded together as the “Young Guns,” drawing their nickname from a magazine feature anointing them rising stars. They scoured the country for like-minded conservatives who shared their uncompromising commitment to shrinking the federal government. They showered these Young Gun recruits with money and support and exhorted them to maintain a laser-like fiscal focus.

By early 2010, talk of the “debt ceiling” began to creep into the lexicon of some Young Gun candidates, first as a reaction to Congress yet again giving the nation the authority to borrow more money. But in time, it became a shorthand, their synonym for all that was wrong with Washington.

How the shorthand of 2010 grew into the showdown of 2011 is the story of a Republican resurgence that brought immense advantage to the leadership but also created immense expectations among this new breed of lawmaker. Having built a majority on ideology, the GOP leadership found itself struggling to control a rambunctious rank and file determined to live up to the bold rhetoric that had brought it to Washington.

The newcomers took Cantor seriously when he urged them in January to see the debt ceiling as leverage. Democrats called the GOP irresponsible for gambling with the economy and the nation’s flawless credit. Republicans countered that an epic clash over the debt limit was inevitable, given the outcome of the election and widespread anger with runaway government spending.

When the deal was finally done and the threat of an economy-rattling default averted, the newcomers’ disdain for compromise had proved effective. They got most of what they wanted and gave little ground.

The new majority emerged emboldened — and hankering for the confrontations to come — even as the financial markets and much of the country reacted with unease about what had just happened.

This account of the party’s transformation, and its impact on the nation’s economic course, is drawn from interviews with the leading participants during this summer’s drama and from earlier interviews, some of them recorded, at various points during the past 21 / 2 years.

The story can be read in full here.

There are a lot of questions that flow from this story. One important question is why in Hell the media did not report it earlier. But if you had the feeling throughout the Debt Crisis discussions that the Republicans were doing their best to advance the cause of the Republican Party and to Hell with the needs of the United States, this story makes it completely clear that they were doing exactly that.

Roubini - Marx was right.

2011-08-14T21:28:00.005-05:00

The prophet of doom Nouriel Roubini who predicted back in 2007 the massive financial collapse that occurred in the Fall of 2008 is at it again.

Marx, among other theories, argued that capitalism had an internal contradiction that would cyclically lead to crises, and that, at minimum, would place pressure on the economic system.

Companies, Roubini said, are motivated to minimize costs, to save and stockpile cash, but this leads to less money in the hands of employees, which means they have less money to spend and flow back to companies.

Now, in current financial crisis, consumers, in addition to having less money to spend due to the above, are also motivated to minimize costs, to save and stockpile cash, magnifying the effect of less money flowing back to companies.

"Karl Marx had it right," Roubini said in an interview with wsj.com. "At some point capitalism can self-destroy itself. That's because you can not keep on shifting income from labor to capital without not having an excess capacity and a lack of aggregate demand. We thought that markets work. They are not working. What's individually rational...is a self-destructive process."

Roubini added absent organic, strong GDP growth -- which can increase wages and consumer spending -- what's needed is large fiscal stimulus, agreeing with another high-profile economist, Nobel Prize-winner Paul Krugman, that, in the case of the United States, the $786 billion fiscal stimulus approved by Congress in 2009 was too small to create the aggregate demand necessary to advance the U.S. economic recovery to a self-sustaining expansion.

Absent additional fiscal stimulus, or unexpected strong GDP growth, the only solution is a universal debt restructuring for banks, homes (essentially households/families), and governments, Roubini said. However, no such universal restructuring has occurred, Roubini said.

Without that additional fiscal stimulus, that lack of restructuring has led to "zombie houses, zombie banks, and zombie governments," he said.

No Good Choices Outside of Fiscal Stimulus or Debt Restructuring

The United States, Roubini said, can in theory: a) grow itself out of the current problem (but the economy is currently growing too slowly, hence the need for more fiscal stimulus); or b) save itself out of the problem (but if too many companies and citizens save, the flaw Marx identified is magnified); or c) inflate itself out of the problem (but that has extensive collateral damage, he said).

However, Roubini said he did not think the U.S. or the world are now at the point where capitalism in self destructing.

"We're not there yet," Roubini said, but he did add that the current trend, if it continues, "runs the risk of repeating the second leg of the Great Depression" -- the 'mistake of 1937.'

The shock headline "Marx was right" ignores the fact that everything Roubini is reported here to have said is well-proven conventional modern macroeconomics. Everyone in the economics business and most honest bankers (there probably are at least two out there) know quite well that what Roubini says is true. The existing economic models all have this built into them! There is no honest argument!

Businesses cannot continue to hoard cash while cutting wages en mass and still have an economy which can afford to buy the products and services the businesses make. But at the same time, no single business is going to start hiring and paying more wages if the market does not exist. This conundrum can only be resolved by the government directly creating jobs and putting money into the hands of consumers.

Today's best comic strip

2011-08-14T18:52:00.006-05:00

Dilbert is usually very good, but this is a strip which will resonate with a great many of us who spend a lot of time in cubicles. It of course speaks to the soullessness of the bureaucracy.

August 14, 2011

Unfortunately, bureaucracy is the only form of rational organization that can manage more than about 200 people or operate over wide areas (railroads, large retailers, utilities, etc.) and can also adapt rapidly and rationally to changing environments (Markets, competitors, etc.) The other two forms of organization are the traditional organization and the charismatic one responding to a charismatic leader. Neither alternative is rational and neither can adapt well to unexpected events. Neither can relatively efficiently operate a railroad or other large organization.

Of the three forms of organization - traditional, charismatic and bureaucratic, only one is rational and is planned, organized and operated on the basis of science. Thus, control groups.

Here's a summary of the Affordable Care Act -- what do the conservatives have to offer? Nothing!

2011-08-14T18:44:00.002-05:00

Here is Slate on the health care initiatives in both Massachusetts and the recently passed federal plan.

...both proposals stand on a "three-legged stool": preventing insurance companies from denying coverage for pre-existing conditions, requiring universal coverage to eliminate "free riding," and subsidizing insurance plans to make them affordable to all. This "incremental universalism," fixing the existing system instead of starting from scratch, appeals to Republicans for its private-sector involvement and to Democrats for its universal coverage. That's what made both "Romneycare" and "Obamacare" possible.

Both plans were first modeled in

...Gruber['s] Micro-Simulation Model, which—well, let's use Gruber's words: It "takes two sets of inputs, fixed information on individuals and varying information on policy parameters, to predict the effect of health market interventions on the movement of people and dollars within the U.S. healthcare system." For the first time, policy makers were able to see whether they could actually afford their health-reform bills and what impact they would have on the behavior of both employers and individuals.

Then more from the architect of the plan, Jonathon Gruber:

Gruber emphasizes, the federal reform is more ambitious and less affordable than the state law was. We've successfully addressed the coverage side of health care, he says. Now, it's time to take a look at the price tag: Do people choose the most cost-effective health care plan? What factors drive their choices? How can we help them choose the best plan? What's the best way to compensate medical providers: paying them for each service or paying them a fixed amount? And what will happen to our health if we pay them less? Ultimately, we need to find a way to slow down the exponential growth of health care costs.

So the federal plan is one that (1) builds on the existing health insurance industry, (2) establishes universal healthcare (which will reduce the massive costs involved in unplanned for provision of health services for large groups of people for whom the actual costs are clearly predictable using insurance principles and the Law of Large Numbers) and (3) sets the stage for a system that will slow down the current runaway health costs.

The Republicans want to abandon the ACA but offer absolutely nothing to replace it. Which means that if the Republicans have their way, the average family will be priced out of health care within a very few years. The Republicans are not problem solvers. They are power mad power mongers.

The prospects of Perry for President

2011-08-14T16:00:00.001-05:00

Romney is running primarily based on his supposed electability (which is why the amount of money he brings in is so very important), but that ignores the fact that he is unnominatable. It really is the Sharon Angle dynamic. The social conservatives simply will not vote for a mormon cult member. It's not a political decision to them, it's a religious one.

That leaves Ron Paul and Bachmann as Perry's only significant opponents. Neither can get over 20% of the Republican nomination voters. I think we will see Perry for President with a veep who is attractive to the money Republicans. It'll be interesting to see if Perry can bury the hatchet with Karl Rove and the Bush people. The Republican desire to win over Obama is going to be one of Perry's strongest selling points.

Perry's shift to the center after locking up the nomination is going to be eye-ball jarring, but the right-wing media will facilitate it by burying all his pandering to secessionists and to the tea partiers. Anyone who dares bring those things up will be attacked.

Perry locked up the social conservatives with his christian "renewal" service last week. And as a Democrat who changed parties to the Republicans he has crafted an image that he will never be out-flanked to the right.

Sneer if you will, but from what I have seen Perry is probably the most talented, determined and well-organized politician on the Republican national stage. He will give Obama one hell of a run for his money.

And remember, I say this as a Texas Democrat. Do not underestimate what Perry brings to the table. John Henry at 12:58 PM has the right idea.

I do not know if there is enough "Texas Fatigue" outside of Texas in the colonies ... uh, the rest of the US ... to be a barrier to a Perry win for President.

Here, from Redstate, is a conservative view of Rick Perry. This is, of course, during the primary season, though, and may not last beyond that time.

An older article on Rick Perry. Burka was quite prescient.

2011-08-14T14:28:00.001-05:00

Here is an excerpt from a February 2010 Texas Monthly article on Rick Perry. Don't ever forget that Rick Perry started out in politics as a Democrat and supported Al Gore for President in Texas in 1988. The media image you see of him today is carefully crafted to get him elected to office.

Remember, this article was published early in 2010. Much of what Rick Perry anticipated in politics appears to have occurred, and he is set to take advantage of those changes.

by Paul Burka

One year ago, I wrote a story about the upcoming Republican gubernatorial primary between Governor Rick Perry and Senator Kay Bailey Hutchison. At the time, Hutchison had recently announced her intention to form a committee to explore a race for governor, and her campaign had released a poll showing her 24 points ahead of Perry, 55 percent to 31 percent. The governor’s political career appeared to be in deep trouble. Among Hutchison supporters, 58 percent had a “very favorable” opinion of her. Only 30 percent of Perry supporters felt the same way about him. She led him in every geographical section of the state.

What a difference a year makes. Since then, their fortunes have gone in opposite directions. Perry has held a lead, typically in the low double digits, in almost every poll taken since early summer, and now it is Hutchison’s political career that is in peril: Her Senate term expires on January 1, 2013, and she has said she will not seek reelection. Meanwhile, Perry’s prospects have never been rosier. Just a year after it appeared that he was on the brink of his last race, he is poised to become one of the leaders of his party. His travel schedule, speaking engagements, and television appearances in recent months give every indication that he and his team of advisers are looking beyond Texas to national politics. If Perry defeats Hutchison in the March 2 Republican primary and goes on to win a third full term in November, he will immediately join the crowd of potential presidential aspirants in 2012—if he hasn’t done so already.

Throughout his career, Perry has always benefited from an uncanny knack for being in the right place at the right time, and once again, his luck seems to be working. The Republican field for 2012 is not deep. Mitt Romney and Mike Huckabee are the leftovers, Mark Sanford self-destructed, Sarah Palin is too polarizing, Newt Gingrich is old news, and that leaves . . . well, why not Rick Perry? Who among the contenders has a better conservative record? Who better expresses the anger of the average Republican voter? Who has a more robust fundraising base? Of the governors commonly mentioned—Tim Pawlenty, of Minnesota; Haley Barbour, of Mississippi; Bobby Jindal, of Louisiana; Mitch Daniels, of Indiana—whose state has weathered the recession more successfully?

Most people who follow Texas politics know by now the conventional wisdom about Perry: that he is an accidental governor who inherited the job when George W. Bush became president; that he is “Governor Goodhair” or “Governor 39 Percent” or some similar appellation of mild disrespect accompanied by a twist of humor; that he doesn’t really do anything well except win elections, which he has done with regularity. There is truth in the conventional wisdom, but there is also blindness. Perry has been so often viewed as a caricature that many Texans have failed to recognize his talent. The fact is that no Republican has so ably surfed the wave of populist anger that has swept through the party in the past year.

That Perry has both the potential and the plan to aim higher than the Governor’s Mansion is underscored by the contrast between his campaign and Hutchison’s. Last fall, I attended events at which each candidate appeared. In October, I watched Perry address the Texas Association of Realtors in a banquet room on the second floor of the Hyatt Regency Hotel in central Austin. TAR is one of the largest and most politically active trade associations in the Austin lobby and one of the biggest financial contributors. Its members are exactly the kind of folks a Republican candidate for governor would want in his corner—individual entrepreneurs and hustlers offering the good life in the suburbs to those who seek it, for a 6 percent commission. And Rick Perry has them in his corner.

As I watched him speak I could appreciate the skills that he has acquired during what is now nine years in office, foremost among which is his ability to connect with his constituency. Early in his remarks, he began an anecdote by saying, “I don’t know how many of you watch Fox News,” before adding, in a knowing tone, “but I suppose most of you do.” Later in the speech, he interrupted himself to urge the people in the audience to take out their cell phones. In an instant he transformed himself into the Aggie yell leader he once was. “Put in that you’re fed up,” he prodded them. “No, put in that you’re fired up. Then text it to 956-13. It comes directly to me.” And, of course, there was the inevitable jab at Washington: “It’s frustrating to deal with the federal government. They are supposed to provide a strong military, secure our borders, and deliver the mail.” He paused for effect. “Well, one out of three ain’t bad.”

Several weeks later, I drove to San Antonio, where Hutchison was making an appearance at the Young Women’s Leadership Academy to talk about education, following an earlier stop in Houston, where she spoke on the same subject. The academy is part of a promising but controversial educational experiment—single-sex public schools for girls—that some women’s and educational advocacy groups have condemned as discriminatory. The person who made schools like this possible was Hutchison herself, through an amendment to the No Child Left Behind Act, in 2001.

The event took place in the library. Hutchison spoke from a lectern on the floor, surrounded by girls from the school. Most of them were black or Hispanic. They wore uniforms of white blouses, pleated plaid skirts, and blue cardigans. The rest of the people in attendance were from the school and the school district. No Hutchison supporters were in evidence; no refreshments were provided. This was not a rally; it was a media event, the object of which was to get free airtime in the state’s third-largest TV market. The most important people in the room were not the school officials but four television reporters with tripods.

Hutchison has been critical of Perry’s record on public education—a dropout pandemic, stagnant test scores—and her remarks were primarily about her support of more innovations. “Single-sex schools are very close to my heart,” she said. She also embraced charter schools, magnet schools, and accelerated high schools. She wants the state to switch to electronic textbooks and provide students with a hybrid device similar to the Amazon Kindle.

The two campaign events seemed to have been part of entirely different races. Perry’s speech to the realtors evoked national themes and aimed to tap into a powerful feeling of discontent toward Washington. Hutchison’s appearance in San Antonio, on the other hand, was designed to portray her as a smart policy maker on an important state issue. She did it well. If you didn’t know they were in the same race, you might conclude that they were running for different offices, Perry for president (or perhaps the second spot on the national ticket), Hutchison for governor or lieutenant governor. The problem for Hutchison is that the energy in the Republican party today is not directed at how to make government work better. It is directed against government, and no one channels that anger better than Rick Perry.

That Perry has his sights set on Washington, the place he professes to loathe, would explain a lot—for starters, why he decided to seek four more years as governor, despite rumors that he had told many of his key supporters that if they stuck with him in 2006 (when Hutchison was openly considering running against him) he wouldn’t run again. Hutchison declined to challenge him, no doubt expecting a clear field in 2010, and Perry became Governor 39 Percent after a four-way race. Following this poor showing, most people, myself included, thought there was no way he could face the voters again. He would become Texas’s longest-serving governor, take a victory lap, and make easy money on the boards of companies that had benefited from his governorship.

But that is not how events played out. Perry’s inner circle, particularly his consultant Dave Carney, has believed that he has had national potential at least since 2006. Carney made that point during an interview I had with the Perry team that summer for a story about the upcoming governor’s race. Carney is from New Hampshire, the incubator of presidential ambitions, and he knows what it takes to succeed on a national level. The rest is my hypothesis: Sometime in 2007, after Perry had been sworn in for his second term, his team surveyed the Republican field and the wreckage of the Bush presidency and recognized that 2008 was destined to be a Democratic year. They saw no one in the GOP field who was capable of defeating Hillary Clinton or Barack Obama. (Best not to mention John Edwards.) But they also saw that the two leading Democrats were destined to be unpopular with older white males, the core constituency of the Republican party. The Democratic winner in 2008 was at risk of being a one-term president.

Will Perry's talent for identifying voter blocs, separating them and catering to those blocs which will make a difference transfer to the national stage?

Obama spent at least six years making those calculations and we can see the results. Rick Perry may well be the person the Republican Party has been looking for to defeat Obama in 2012 and if it looks like he is, nothing is going to stop him from getting the Republican nomination for President and taking a strong run against Obama.

Democrats need to learn the true lessons about Rick Perry

2011-08-14T13:01:00.004-05:00

Perry is one of the finest politician working in America today. Most of what you have seen in the media is Perry catering to the key voters groups he needed for his next election. Do NOT underestimate the man!

Here is a revealing article on Perry in today's Houston Chronicle. It's called "5 lessons Perry learned in his political career." I have no doubt at all that Perry is the sharpest politician and the best placed one in the running for the Republican Presidential nomination today.

The second element "Trust your Team" is going to be important after he goes far right to get the nomination and then has to move to the center for the election. I am certain they already have that planned out as neatly as they planned his announcement to suck the wind from the sails of all the other Republican candidates during Iowa. If the very professionalism of that announcement does not just leave you with a feeling of strong admiration then you are not a true political junkie. Perry and his team have repeatedly demonstrated that level of skill here in Texas.

A second element stands out in the Houston Chronicle article. Like Obama, Perry has quickly become adept at using social media to campaign extremely effectively below the level of the MSM. Political wonks don't see this level so the results often come as a nasty surprise as the votes are counted.

The Republicans don't particularly like any other of the candidates for the nomination either. As soon as they see Perry is serious and moving on the nomination they are going to coalesce around Perry like salt crystals on a string in a supersaturated solution. (Do they still do that experiment in high school chemistry these days?)

One element of the coalescing is going to be to bury the embarrassing secessionist and similar statements in a mass of FOX and Limbaugh verbiage. It was done for "Shrub" and it'll be done again for "Good Hair" - but smoother and more effectively.

Don't plan on "Good Hair" making a major misstep on the national political scene. His reputation for being stupid is a self-defeating lie spread by his (very many) political enemies, much as Bill Clinton's Arkansas political enemies spread lies about him. If you believe it you'll never take the actions needed to defeat him. Unlike the other potential Republican Presidential nominees, to defeat "Good Hair" the Democrats will have to bring their A-game.

Addendum 1:44 PM CDT
I just discovered Red Dirt & Sand. It's a blog on Texas politics, and the blogger has been focusing on Rick Perry.

I'd like to do a similar focus but with a family member undergoing chemotherapy I simply do not have the time I need. Right now I am more likely to spend time posting on care of the Central Venous Catheter, changing dressings and flushing. Nursing was not one of my preferred occupations, but you do what you need to do.

Go read Kenneth Franks blog. We are all going to need to know more about Rick Perry quite soon.

A good report on the British riots

2011-08-13T07:53:00.002-05:00

This is a rather nuanced report from the riots in Great Britain. The final line says a lot:

"We need to tell the media we will not tolerate the tyranny, but we will not react either," said Harpreet Singh, 28. "We are capable, but we will not do it."

Go read the entire article form the Guardian. The story is not just some wild kids trying to steal a few TVs. It's about a few wild young guys out to riot, steal or burn but often being restrained by their friends or their families. It's about people joining the demonstrations to make a statement and yet it's about people avoiding the demonstrations because they are concerned the demonstrations will go too far. It's about people defending their own neighborhoods while looking in vain for the police who they expect to defend their neighborhoods. It's also about people who are using social media to incite the next demonstration even as others are using social media to direct the press to various incidents.

It's also about a conservative government in which politicians are reacting in both anger and ignorance to events which the politicians feel disrespects them.

There's a lot in this article that the politicians need to be aware of. The entire set of events began as an effort to send them a message that what the government was doing was not working and was not going to work. It's really about a number of communities who saw an opportunity to communicate their displeasure with the government’s policies, true, but that's only one element of the overall story. It's also simply about a number of communities and how they reacted as communities when they were threatened.

Paul Lewis of the Guardian caught a great deal that rings true from the riots that most of us around the world knows little of the British events beyond pictures on TV of shops and cars burning in the night. It's not just drunk teenagers with fire bombs, although there are some of those. It's about communities that feel they have to communicate with a government that is ignoring them and which is taking advantage of the current circumstances to do so. But it's not a bunch of hopeless dead-enders, either. It's people who expect more from their government than they have been getting.

How much trouble is America in? A lot.

2011-08-08T18:21:00.002-05:00

Two more editorials describe the current state of American politics and its economic ramifications.

Credibility, Chutzpah and Debt Here Paul Krugman points to the idiocy of Standard and Poors senseless downgrading of the US treasury debt. It should be noticed that the international stock markets have been all over the map since they opened Monday, and where did money looking for safety and security go? To US treasury debt.
The Bad Deal University of Texas professor James K. Gailbraith points out that Obama is not only not a Progressive, he is in fact a conservative who is working league with the American conservatives and with the Pete Peterson Foundation to destroy the American middle class and the two programs that support it most, Social Security and Medicare.

Compare these two well-written editorials with the one Tom Friedman wrote about America's slow decline and you can see that America is in real trouble.

America's slow economic decline

2011-08-08T14:36:00.002-05:00

Every once in a while Thomas Friedman discovers something that matters. The first part of his 08/07/2011 editorial is spot on. He is writing about America's decline in comparison with the other industrial nations in the world. And how does he characterize that decline?

...our country is now finding itself in the worst kind of decline — a slow decline, just slow enough for us to keep deluding ourselves that nothing really fundamental needs to change if our future is to match our past.

Our slow decline is a product of two inter-related problems. First, we’ve let our five basic pillars of growth erode since the end of the cold war — education, infrastructure, immigration of high-I.Q. innovators and entrepreneurs, rules to incentivize risk-taking and start-ups, and government-funded research to spur science and technology.

We mistakenly treated the end of the cold war as a victory that allowed us to put our feet up — when it was actually the onset of one of the greatest challenges we’ve ever faced. We helped to unleash two billion people just like us — in China, India and Eastern Europe. For us to effectively compete and collaborate with them — to maintain the American dream — required studying harder, investing wiser, innovating faster, upgrading our infrastructure quicker and working smarter.

Instead of doing that at the scale we needed — that is, building muscle — we injected ourselves with massive amounts of credit steroids (just like our baseball players). This enabled millions of people to buy homes they could not afford and to fill jobs in construction and retail that did not require that much education. Our European friends went on a similar binge.

All this debt blew up in 2008 in the U.S. and Europe, and that led to the second problem: Homeowners, firms, banks and governments are all now “deleveraging” or trying to — meaning that they are saving more, shopping less, paying off debts and trying to dig out from mortgages that are under water.

No one better explains the implications of this than Kenneth Rogoff, a professor of economics at Harvard, who argued in an essay last week for Project Syndicate that we are not in a Great Recession but in a Great (Credit) Contraction: “Why is everyone still referring to the recent financial crisis as the ‘Great Recession?’ ” asked Rogoff. “The phrase ‘Great Recession’ creates the impression that the economy is following the contours of a typical recession, only more severe — something like a really bad cold. ... But the real problem is that the global economy is badly overleveraged, and there is no quick escape without a scheme to transfer wealth from creditors to debtors, either through defaults, financial repression, or inflation. ...

“In a conventional recession,” Rogoff noted, “the resumption of growth implies a reasonably brisk return to normalcy. The economy not only regains its lost ground, but, within a year, it typically catches up to its rising long-run trend. The aftermath of a typical deep financial crisis is something completely different. ... It typically takes an economy more than four years just to reach the same per capita income level that it had attained at its pre-crisis peak. ... Many commentators have argued that fiscal stimulus has largely failed not because it was misguided, but because it was not large enough to fight a ‘Great Recession.’ But, in a ‘Great Contraction,’ problem No. 1 is too much debt.” Until we find ways to restructure and forgive some of these debts from consumers, firms, banks and governments, spending to drive growth is not going to come back at the scale we need.

Our challenge now, therefore, is to deleverage the economy as fast as possible, while, at the same time, getting back to investing as much as possible in our real pillars of growth so our recovery is built on sustainable businesses and real jobs and not just on another round of credit injections.

Go back and look at the paragraph I highlighted. What characterizes the five basic pillars of growth? They are again

education,
infrastructure,
immigration of high-I.Q. innovators and entrepreneurs,
rules to incentivize risk-taking and start-ups, and
government-funded research to spur science and technology.

All require either government funding or government action. education, infrastructure and government-funded research were largely funded through the Pentagon or because of the Cold War.

We could fund those things because of the cold war, but not destroy the results in a hot war. The idiocy of the unnecessary invasion of Iraq led to a total waste of American government funds that otherwise would have been better used on education and infrastructure.

Today we live with the results of the tax cuts for billionaires and two unnecessary and poorly fought wars without taxes to support them. This is the libertarian "starve the beast program."

Instead of unleashing American productivity what is happening is that the American conservatives, led by the libertarians, is causing America's slow economic decline in comparison with the rest of the industrial world. This is what Thomas Friedman has caught on to.

The worldwide debt "binge" that Friedman whines about further on comes because the entire world is trapped in the libertarian fantasy that if governments just cut back enough then productivity will be unleashed. But what is actually happening is that the educated workers supported by needed infrastructure aren't there to be productive.

Instead we have big businesses (inherently not sources of increased productivity - that comes from small businesses) sucking up as much money as they can as profits and stashing it on their books as they search for places to invest it. (See the mortgage crisis.)

Until governments start increasing the spending on education and infrastructure and quit penalizing small businesses so that big businesses can make more profits then the world economy is going to continue to decline - with America slowly leading the way.

Maddow provides rare moment of Sunday morning Sanity

2011-08-08T02:02:00.003-05:00

For a moment there was a rare moment of sanity and honesty on the Sunday morning shows. Where did the debt crisis come from? It was NOT a crisis about America's likelihood of financial default. It was a made-up crisis created by the Republican extremists in the House of Representatives - a made up crisis intended to create a hostage situation so that the extremists could get their self-centered irrational agenda passed because otherwise, no sane legislator would have given it a moment's notice.

The transcript is provided Here.

The conservatives have declared economic war on the American people

2011-08-06T20:19:00.002-05:00

The expected idiocy from Faux "News" is here.

This is objective analysis? Not hardly. The right-wing liars are already repeating the same idiocies that created the current economic mess and which have made it worse. The problem is that after the bankers on unrestrained Wall Street were allowed to steal too much from the Mortgages they handled and crashed the economy the economy has stalled. It has stalled because there is too little consumer demand for businesses to invest in America! The top 100 businesses are sitting on over $2 trillion they cannot spend to hire workers because there are NO GROWING MARKETS TO INVEST IN! Budget cutting and austerity (the Herbert Hoover solution from 1929 and the 30's) did not work then to get the economy back on track and will not work now.

It's time to listent to Paul Krugman.

In case you had any doubts, Thursday’s more than 500-point plunge in the Dow Jones industrial average and the drop in interest rates to near-record lows confirmed it: The economy isn’t recovering, and Washington has been worrying about the wrong things.
Fred R. Conrad/The New York Times

It’s not just that the threat of a double-dip recession has become very real. It’s now impossible to deny the obvious, which is that we are not now and have never been on the road to recovery.

For two years, officials at the Federal Reserve, international organizations and, sad to say, within the Obama administration have insisted that the economy was on the mend. Every setback was attributed to temporary factors — It’s the Greeks! It’s the tsunami! — that would soon fade away. And the focus of policy turned from jobs and growth to the supposedly urgent issue of deficit reduction.

But the economy wasn’t on the mend.

Yes, officially the recession ended two years ago, and the economy did indeed pull out of a terrifying tailspin. But at no point has growth looked remotely adequate given the depth of the initial plunge. In particular, when employment falls as much as it did from 2007 to 2009, you need a lot of job growth to make up the lost ground. And that just hasn’t happened.

Consider one crucial measure, the ratio of employment to population. In June 2007, around 63 percent of adults were employed. In June 2009, the official end of the recession, that number was down to 59.4. As of June 2011, two years into the alleged recovery, the number was: 58.2.

These may sound like dry statistics, but they reflect a truly terrible reality. Not only are vast numbers of Americans unemployed or underemployed, for the first time since the Great Depression many American workers are facing the prospect of very-long-term — maybe permanent — unemployment. Among other things, the rise in long-term unemployment will reduce future government revenues, so we’re not even acting sensibly in purely fiscal terms. But, more important, it’s a human catastrophe.

[...]

To turn this disaster around, a lot of people are going to have to admit, to themselves at least, that they’ve been wrong and need to change their priorities, right away.

Of course, some players won’t change. Republicans won’t stop screaming about the deficit because they weren’t sincere in the first place: Their deficit hawkery was a club with which to beat their political opponents, nothing more — as became obvious whenever any rise in taxes on the rich was suggested. And they’re not going to give up that club.

But the policy disaster of the past two years wasn’t just the result of G.O.P. obstructionism, which wouldn’t have been so effective if the policy elite — including at least some senior figures in the Obama administration — hadn’t agreed that deficit reduction, not job creation, should be our main priority. Nor should we let Ben Bernanke and his colleagues off the hook: The Fed has by no means done all it could, partly because it was more concerned with hypothetical inflation than with real unemployment, partly because it let itself be intimidated by the Ron Paul types.

Well, it’s time for all that to stop. Those plunging interest rates and stock prices say that the markets aren’t worried about either U.S. solvency or inflation. They’re worried about U.S. lack of growth. And they’re right, even if on Wednesday the White House press secretary chose, inexplicably, to declare that there’s no threat of a double-dip recession.

Earlier this week, the word was that the Obama administration would “pivot” to jobs now that the debt ceiling has been raised. But what that pivot would mean, as far as I can tell, was proposing some minor measures that would be more symbolic than substantive. And, at this point, that kind of proposal would just make President Obama look ridiculous.

The point is that it’s now time — long past time — to get serious about the real crisis the economy faces. The Fed needs to stop making excuses, while the president needs to come up with real job-creation proposals. And if Republicans block those proposals, he needs to make a Harry Truman-style campaign against the do-nothing G.O.P.

This might or might not work. But we already know what isn’t working: the economic policy of the past two years — and the millions of Americans who should have jobs, but don’t.

We were told last week that there was a 40% chance of a double dip recession. I said then that the real chance was closer to 90%. Unless Krugman's solution is applied then 90% is also too low.

As Krugman said above - there has been no recovery. It should be obvious we were lied to - by everyone including the Obama administration. The austerity idiots - including but not limited to the propaganda idiots of the criminal enterprises run by Rupert Murdoch - are after power for the conservatives, not recovery for America.

The announcement by S&P of the downgrading of US federal debt was a further statement of war against the American people. That war is going to either end in a right-wing dictatorship that pleases Rupert Murdoch and the teabaggers or it is going to end in the kind of revolt in the streets that the people of Wisconsin are now conducting against the right-wing libertarian dictator-governor Scott Walker which the Koch brothers installed in 2010.

It's going to be a long hard slog getting rid of the anti-American conservatives currently working to take over America. Krugman's solution will be a requirement for getting there, but the political wars will be coming first.

S&P downgrade of US debt not a financial decision - it's a rebuke of Republican national politics

2011-08-06T12:15:00.005-05:00

S&P has essentially stated that while the GOP remains significant in national US politics S&P no longer trusts the US government to pay its bills. So they downgraded US government debt to AA+. Now S&P itself has rather dubious credibility but who could have followed the tea party-inspired Republican idiocy of the last month or so and still question S&P's decision?

The US is still the wealthiest nation in the world. It still CAN pay its bills. But with John Boehner and Mitch McConnell in Congress being whipsawed by the idiot teabaggers like Allen West there is reasonable doubt that the US WILL pay its bills. The S&P downgrade is an indictment of America's current politics.

It is also a total indictment of the Republican Party. Here is Steve Benen's timeline of major US financial decisions over the last 30 years.

1980: Ronald Reagan runs for president, promising a balanced budget

1981 - 1989: With support from congressional Republicans, Reagan runs enormous deficits, adds $2 trillion to the debt.

1993: Bill Clinton passes economic plan that lowers deficit, gets zero votes from congressional Republicans.

1998: U.S. deficit disappears for the first time in three decades. Debt clock is unplugged.

2000: George W. Bush runs for president, promising to maintain a balanced budget.

2001: CBO shows the United States is on track to pay off the entirety of its national debt within a decade.

2001 - 2009: With support from congressional Republicans, Bush runs enormous deficits, adds nearly $5 trillion to the debt.

2002: Dick Cheney declares, “Deficits don’t matter.” Congressional Republicans agree, approving tax cuts, two wars, and Medicare expansion without even trying to pay for them.

2009: Barack Obama inherits $1.3 trillion deficit from Bush; Republicans immediately condemn Obama’s fiscal irresponsibility.

2009: Congressional Democrats unveil several domestic policy initiatives — including health care reform, cap and trade, DREAM Act — which would lower the deficit. GOP opposes all of them, while continuing to push for deficit reduction.

September 2010: In Obama’s first fiscal year, the deficit shrinks by $122 billion. Republicans again condemn Obama’s fiscal irresponsibility.

October 2010: S&P endorses the nation’s AAA rating with a stable outlook, saying the United States looks to be in solid fiscal shape for the foreseeable future.

November 2010: Republicans win a U.S. House majority, citing the need for fiscal responsibility.

December 2010: Congressional Republicans demand extension of Bush tax cuts, relying entirely on deficit financing. GOP continues to accuse Obama of fiscal irresponsibility.

March 2011: Congressional Republicans declare intention to hold full faith and credit of the United States hostage — a move without precedent in American history — until massive debt-reduction plan is approved.

July 2011: Obama offers Republicans a $4 trillion debt-reduction deal. GOP refuses, pushes debt-ceiling standoff until the last possible day, rattling international markets.

August 2011: S&P downgrades U.S. debt, citing GOP refusal to consider new revenues. Republicans rejoice and blame Obama for fiscal irresponsibility.

Unless you are a Republican partisan practicing Tobacco Industry Executive-level blindness to facts this timeline clearly shows that the Republican Party is the party of profligate spending and refusal to pay government debts.

How long can America afford to accept Republican politicians as a legitimate American political party?

Addendum 1:13 PM CDT
This is from Daniel Gross, Economics editor at Yahoo Finance

S&P, which covered itself in a substance other than glory during the mortgage crisis, may have a poor record and strange methodology when it comes to sovereign ratings. France, which has a far higher debt per capita ratio than the U.S., still enjoys a AAA rating. And a downgrade, alone, doesn't mean U.S. interest rates will spike -- on Monday or at any time in the future. Japan's credit rating was downgraded several years ago, when the interest rates its government paid on bonds was already extremely low, and they've generally trended lower in the years since.

Market conditions, the trajectory of economic growth and relative value can play as big -- if not a bigger -- of a role in determining interest rates than a rating.

But that doesn't mean we should ignore S&P's Friday evening shot across the bow. In downgrading the U.S.'s credit rating, S&P points out what has long been obvious: Washington's inability to come to an agreement on how to close the large fiscal gaps that have emerged since the recession began is troubling. Recent events have sapped the agency's confidence that the government can and will do what is necessary to align revenues with spending commitments. And it's difficult to escape the conclusion that America's credit rating was intentionally sabotaged by Congressional Republicans.

The decision was more than just S&P's opinion of the politics, though. This was a clear political statement BY S&P itself!

Steve Benen points this out.

Officials from Standard & Poor’s provided documents to the Treasury Department, explaining the downgrade. Obama administration officials noticed a problem: the S&P numbers didn’t add up.

On Friday, the company notified the Treasury that it planned to issue a downgrade after the markets closed, and sent the department a copy of the announcement, which is a standard procedure.

A Treasury staff member noticed the $2 trillion mistake within the hour, according to a department official. The Treasury called the company and explained the problem. About an hour later, the company conceded the problem but did not indicate how it planned to proceed, the official said. Hours later, S.& P. issued a revised release with new numbers but the same conclusion.

Got that? S&P prepared an analysis to justify a specific conclusion. The analysis was off by $2 trillion. Treasury explained to S&P that the analysis wasn’t even close to being accurate, which led the ratings agency to concede they’d made a mistake.

And a few hours later, S&P decided to reach the same conclusion anyway. The agency wanted to proceed with a downgrade; whether its numbers added up was irrelevant.

That certainly inspires confidence in the integrity of Standard & Poor’s decision making, doesn’t it?

S&P makes its evaluations supposedly on the financial records of the organizations issuing debt. If this were the case, then France would have a lower rating than the US, but France still as an AAA rating. S&P was incompetent during the mortgage crisis and it once again proved itself to be financially incompetent and a collection of wealthy political hacks.

Addendum II 5:38 PM CDT
If you have any doubt at all that the S&P debt rating downgrade is totally a political act by an incompetent financial rating agency, then go read the analysis by Dean Baker. S&P's "justification" simply doesn't pass the smell test. There is no possibility at all that Social Security will contribute to the deficit in the future and the claim that out of control Medicare costs will effect the budget in the future overlooks the fact that Medicare has a great deal more control over medical costs than the private market does.

One million dollars anonymously to Mitt Romney's campaign - source a foreign government?

2011-08-05T21:08:00.008-05:00

This is a very important question. Why, with the Citizens United decision in place is this level of secrecy required?

Visit msnbc.com for breaking news, world news, and news about the economy

The organization, W. Spann, LLC was created and six weeks later contributed $1 million to the Romney campaign. No one knows where the money came from. Eleven weeks later the organization was dissolved. It operated from an address (590 Madison Ave, NY, NY) which is also the address of Mitt Romney's investment company, Bain Capital.

Since the Citizen's United decision makes it legal for corporations to donate unlimited amounts to candidates, what is the reason for the secrecy? My bet is that his is money donated from a foreign government trying to influence the American Presidential election. If this is not the North Korean government or some similar government contributing (with the knowledge of Romney - the address proves that) then the Romney campaign better tell us where the money came from

Addendum 8/7/11 12:02 CDT
The individual who donated the $1 million has come forward and Benjy Sarlin at TPM has reported on it.

Ed Conrad, a former executive at Bain Capital, which Romney co-founded, told Politico on Friday that he had funneled the money to Super PAC Restore Our Future on the advice of his lawyers.

"I am the individual who formed and funded W Spann LLC," he said in a statement. "I authorized W Spann LLC's contribution to Restore Our Future PAC.I did so after consulting prominent legal counsel regarding the transaction, and based on my understanding that the contribution would comply with applicable laws. To address questions raised by the media concerning the contribution, I will request that Restore Our Future PAC amend its public reports to disclose me as the donor associated with this contribution."

I'd like to see more on this, especially where Ed Conrad claims HE got the money. This is a man who was a close associate of Mitt Romney and who could easily be expected to fall on his sword to cover up something illegal or immoral like transmitting a contribution from a foreign government.