The end of outsourcing for cheap labor

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!"?

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

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.

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

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

"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.

1. 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.
2. 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.
3. 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

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

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"

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

Does the economy now need government stimulus or austerity?

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

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!

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

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

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.

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

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

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.

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The London riots are a political statement

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

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

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


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


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


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


5. 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

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.