Thursday, January 28, 2010

Matt Taibbi on Media Bias

What a great article. Taibbi argues that outlandishly criminal behavior by Wall Street continued unchecked in part due to the tone of media coverage. Taibbi summarizes the coverage in the following terms:

"...outrages are covered without outrage, and stories that are not particularly “balanced” in reality — stories that for instance are quite plainly about one group of people screwing another group of people — become transformed into cool, “objective” news stories in which both the plainly bogus version of events and the real and infuriating version are given equal weight..."

I agree with Taibbi on this point and others made in his must read article. Wall Street behavior, such as Goldman's practice of betting against its clients' investments (recommended by Goldman), is reprehensible, yet no convictions have been made, no major regulatory changes pursued, no break ups instigated. WTF

Wednesday, January 27, 2010

Reacting to Obama's Speech

I had mixed reactions to Obama's speech. He is an excellent speaker, of course. And he communicates sincerity. I liked what I heard about job creation.

However, his energy proposals began with nuclear, moved to offshore drilling, before concluding with alternative energy. I wonder if that is where we have come to? Is it truly the case that cheap, available oil is basically gone and we are going to engage in a made resource dash, at whatever environmental costs?

If this is truly where we are at--a mad dash for declining resources--then I have little hope for real innovation because a long term orientation is necessary for sustainable change. Mad dashes with environmental costs and military personnel as security do not promise a better, more sustainable future.

On the other hand, I liked the way Obama concluded his speech with a discussion of "politics." However, talking the talk is one thing. Reform in politics cannot occur unless money expenditures are regulated and rendered fully transparent. The Supreme Court has dissolved that avenue for reform.

So, in balance, Obama's speech gave me some hope and raised some concerns. At this point, I suspend final judgment.

Tuesday, January 26, 2010

Michael Hudson on the Illusion of "Recovery"

Michael Hudson echoes a theme also articulated by Robert Reich: There can be no recovery because the economy has been predicated upon an unsustainable debt bubble. The economy must be re-built. Efforts to "re-inflate" the bubble will fail.

His article is a good articulation of this problem

Here is an excerpt:

"We are not really emerging from a “recession.” The word means literally a falling below a trend line. The economy cannot “recover” its past exponential growth, because it was not really normal. GDP is rising mainly for the FIRE sector – finance, insurance and real estate – not the “real economy.” Financial and corporate managers are paying themselves more for their success in paying their employees less.
This is the antithesis of recovery for Main Street. That is what makes the FIRE sector so self-destructive, and what has ended America’s great post-1945 upswing..."

Bill Gates of Dystopian Future 10 Years Hence

As quoted in Information Week, Bill Gates argues:

"If we project what the world will be like 10 years from now without innovation in health, education, energy, or food, the picture is quite bleak," said Gates, in his annual letter from the Bill & Melinda Gates Foundation, published earlier this week.

Health costs for the rich will escalate, forcing tough trade-offs and keeping the poor stuck in the bad situation they are in today," Gates wrote. The damage won't be limited to the Third World, Gates said.

"In the United States, rising education costs will mean that fewer people will be able to get a great college education and the public K-12 system will still be doing a poor job for the underprivileged," he said.

Gates added that stalled innovation could ultimately lead to a hotter planet where food and energy are in short supply.

"We will have to increase the price of energy to reduce consumption, and the poor will suffer from both this higher cost and the effects of climate change. In food we will have big shortages because we won't have enough land to feed the world's growing population and supports its richer diet," said Gates

I agree with Gates that the immediate future holds significant challenges including oil and water scarcities and widespread pollution threatening human health.

The market is not capable of solving these problems. The market has incentives for short-term profits and publicly traded companies do not have incentives for investing in costly infrastructural changes that will reduce energy consumption and pollution.

Government alone is capable of directing and incentivizing needed changes. However, governments everywhere are so corrupted by financial interests that it seems improbable that they will put the long term needs of the planet first when policy is viewed as undermining market autonomy or as creating costs.

I do not see a bright future as I believe the imminent problems will simply be allowed to develop into full scale disasters. We saw that happen in New Orleans and we saw that happen in Haiti. Expert authorities were well aware that these locales would become disaster zones in the likely events of storms and earthquakes. Yet no efforst were made to forestall forseen disasters because such efforts would have been costly and might have disrupted existing power structures....

Monday, January 25, 2010

The Great Recession Didn't Have to Happen

I like Dean Baker's analysis. His argument about why the great recession wasn't a given is worth reading.

My opinion is that the great recession is destroying the middle class. It has provided opportunities for many profitable companies to lay off workers and to outsource more key operations. For instance, Sam's Club announced it is going to lay off 11,000 workers who offer samples in Sam's stores. Sam's will now outsource that function. I know from a friend's experience that outsourced sample providers do not get benefits.

I have friends who are professionals whose jobs are in jeopardy. Every week I read about or hear from friends of more and more layoffs.

The federal government's broadest figure for unemployment is 17.6%. Shadow Stats, an online website that analyzes government data, says the real number, including people who no longer receive benefits, is around 22%

American workers are experiencing an unprecedented assault.

This recession has exacerbated that assault.

The criminals who precipitated this crisis through insane leveraging of derviatives ought to be held responsible.

Saturday, January 23, 2010

Volcker In: Geithner Out?

Yesterday on NPR's Marketplace I heard that Volcker is "in" and Geithner is (symbolically at least) "out." What a relief if this is true. Some time ago I posted a link to a story about Volcker. The news story quoted him as saying "Wake Up Gentlement!" Volcker has been agitating for the too big to fails to be broken up, or at least extensively regulated.

Jesse's Cafe Americain has a link to a report issued by the Group of 30 under Volcker's direction on financial reform. Here it is

I haven't read the report yet but plant to. I sincerely hope that action on regulation finally happens!

Here is another link to a short article written by James K. Galbraith on what kinds of reform are needed and why Volcker's ascendancy is a good sign for the nation

Thursday, January 21, 2010

Free Speech: Are Corporations the Same as People

For about 100 years, our U.S. Supreme Ct. has operated upon the principle that corporations do not have the same free speech rights as do people. This ruling aimed to preserve democracy from the corruption of wealth.

The Supreme Court has just over-turned that ruling made so long ago. Now corporations have the same rights as do people when it comes to campaign contributions.

I wonder how Europeans felt in the 1930s when they viewed the forces and strategies of fascism rising in their countries. Did they think, "well this event and that policy are small things and their passage does not necessarily mean my country is becoming fascist?"

Outsiders must have observed what was going on and known.

In retrospect we ask "why didn't they do something about rising fascism in Italy, Spain, German, Japan, Russia (under Stalin)?"

Is this how it happened?

Legitimate Democratic Dissent or Terrorism?

One of the most worrying aspects of the "war on terror" concerns the abridgement of Constitutionally guaranteed civil liberties. Habeas corpus, that most ancient of rights, has already been destroyed by targeted assissinations and indefinite detentions.

More recently, Department of Defense training material classified street protests as low level terrorist events. The ACLU is suing to have that removed from the training material.

I have read on multiple blog sites about recent approaches to "security" that involve government plants in "dissident groups" in the US. The plants aim to organize protests or actions that can be then used to justify overt actions by "security forces" against the dissident groups. Any group that doesn't agree with the status quo can be labeled "dissident." Here is Paul Craig Roberts account of what is going on:

"One Obama appointee, Harvard law professor Cass Sunstein, advocates that the U.S. government create a cadre of covert agents to infiltrate anti-war groups and groups opposed to U.S.government policies in order to provoke them into actions or statements for which they can be discredited and even arrested."

I suggest reading Roberts' essay. Or, more info can be attained here at Alernet's_spine-chilling_proposal_to_'cognitively_infiltrate'_conspiracy_theorist_groups?comments=view&cID=1415609&pID=1415550

More generally, I fear that growing resource conflict abroad and more domestic unrest due to unemployment and impoverishment will create ever more repressive "security" strategies and tactics.

Our so-called "democracy" is in serious danger of transforming into something more overtly fascist.

Wednesday, January 20, 2010

Michael Hudson on Wall Street's Power Grab

I am a great fan of Michael Hudson's work. He is an established economist. Most recently, he was hired by the government of Iceland to help them deal with the aftermath of their financial meltdown. Anything he writes is worth reading, from my opinion:

Here is an excerpt from his essay:

"I think the Wall Street boys are playing possum. Why should we expect them to explain their strategy to us? To understand their game plan, the Commissioners had to wait for the second day of the hearings, when Sheila Bair of the Federal Deposit Insurance Corp. (FDIC) spelled it out. Their first order of business is to make sure that the Federal Reserve Board is designated the sole financial regulator, knocking out any more activist regulators – above all the proposed Consumer Financial Products Agency that Harvard Professor Elizabeth Warren has helped design. Wall Street also is seeking to avert any thought of restoring the Glass-Steagall Act in an attempt to protect the economy from having merged retail commercial banking with wholesale investment banking, insurance, real estate brokerage and kindred arms of high finance..."

Half of States Have Run Out of Unemployment Funds

Tuesday, January 19, 2010

Swiss Banker Blows Whistle on Tax Evasion

It is no secret that the really wealthy often do not pay their fair share of taxes. It is reprehensible that the middle class is forced to pay higher taxes because very wealthy individuals and corporations evade taxes through off-shoring. From a NYT article:

Mr. Elmer, who ran the Caribbean operations of the Swiss bank Julius Baer for eight years until he was dismissed in 2002, moved to Mauritius in the Indian Ocean and began parceling out to global tax authorities what he said were the secrets of his former employer. “It is a global problem, and I am only the messenger who provides the bad news, or even better, the truth,” Mr. Elmer, 54, wrote in a recent e-mail message. “Offshore tax evasion is the biggest theft among societies and neighbor states in this world.”

Mybudget 360 has a great article that complements the above NYT piece titled,"How the Average American household making $52,000 a Year is Coping while the Ultra Rich Pull Away. Examining the new Numbers on Income Distribution in the United States."

Monday, January 18, 2010

Lack of US Response in Haiti

Greg Palast's essay....

Congressional Report: Reigning in the Imperial Presidency

A Must Read...

Comparing Headlines: Our New Plutonomy

"Goldman Sachs bankers are forecast to enjoy an 81% rise in their pay and bonuses for 2009, even though the bank may be forced to respond to political pressure by reducing the amount of money it sets aside for employee payouts in the fourth quarter of the year. "

"The aftershocks from deep recessions reverberate for years, even decades, and take an enduring toll on everything from government finances to countless upended individual lives."

US Military and Haiti

Today's Arizona Republic newspaper has an article titled "Haiti Anger Grows: Airport Bottleneck Cited in Aid Delays" attributed to the Associated Press.

The article discusses a very, very disturbing phenomenon. According to aid groups, the US military, which has taken control of the airport for Port-au-Prince, is prioritizing landing US military planes carrying military personnel, OVER AIRFLIGHT CARRYING AID.

Why would the US military prioritize military personnel OVER aid?

I am so sickened by this report and its confirmation in other news accounts.

What has happened to our nation and its priorities?

Saturday, January 16, 2010

Naomi Klien on Corporate Branding

Naomi Klein on how corporate branding has taken over AmericaTen years after the publication of No Logo, Naomi Klein switches her attention from the mall to Barack Obama and discovers that corporate culture has taken over the US government

Wednesday, January 13, 2010

Toxic GMO Corn

I have read that the entire US corn crop has been contaminated with genetically modified corn. Today Naked Capitalism extracts data from a recent study on the toxicological effects of GMO corn. The study was conducted on rats.

The authors postulate that the genetically embedded pesticide and/or herbicide related genes in the corn are responsible for the observed toxicological effects.

Here is an excerpt from the conclusion:

"We therefore conclude that our data strongly suggests that these GM maize varieties induce a state of hepatorenal toxicity. This can be due to the new pesticides (herbicide or insecticide) present specifically in each type of GM maize, although unintended metabolic effects due to the mutagenic properties of the GM transformation process cannot be excluded."

Tuesday, January 12, 2010

The Best Comprehensive Analysis of Where Things Stand

This link to an article by Jack Rasmus at Z Magazine offers the best comprehensive description and analysis of the current financial situation of the nation and its likely developments over 2010.

Although Z Magazine is a left of center publication, I found the reference to this article by Rasmus on a rather economically conservative webpages. Rasmus' analysis is very lucid and non-ideological.

I urge readers to check it out.

Pipeline Geopolitics

This is a good article at GlobalResearch on the geopolitics of pipelines. I personally believe that the US presence in Iraq and Afghanistan is ALL and ONLY about energy politics.

Check out the article then follow the news. It is amazing how pipeline maps (existing and proposed) explain and predict US military engagements.

Additionally, it is amazing how terrorism is suddenly "discovered" to be a big problem in places that have untapped oil, gas, and/or mineral reserves, such as Yemen.

Why is the U.S. AFRICOM expanding? The answer is clear. There is a big resource grab happening in Africa. Michael Klare's book, Resource Wars unpacks these trends.

What is so problematic about the resource grab is that the money and labor spent on colonial control and military conquest could be spent developing more sustainable energy platforms and forms of living....

What is worse, US interference in resource rich nations disrupts lives, livelihoods, and national self-determination

Monday, January 11, 2010


This is not the first post I've made on torture. Torture doesn't work (doesn't produce valid information) and it destroys the torturer as well as cementing opposition from the tortured.

Washington's Blog today has a troubling post on torture arguing that it continues under Obama:

I recommend the post.

It has increased relevance for me today because after watching the film, The Power of Nightmares (see previous post for link) I have been thinking about all of those innocent civilians in Afghanistan and Iraq who ended up being incarcerated and tortured by American forces, contractors, and locals empowered to "police."

The Power of Nightmares explains that the "vast terrorist network" of al-Qaeda was literally manufactured in order to prosecute Bin Laden using U.S. criminal conspiracy laws that allow prosecution without habeas corpus.

Ideas have consequences. The belief in al-Qaeda let to the incarceration and torture of innocents, who then became enemies of the US. US abuses produce more enemies. It is a sick and completely self-defeating circuit.

A sample from today's Washington's Blog:

"At least two men died during imprisonment. One of them, a 22-year-old taxi driver named Dilawar, was suspended by his hands from the ceiling for four days, during which US military personnel repeatedly beat his legs. Dilawar died on Dec. 10, 2002. In the autopsy report, a military doctor wrote that the tissue on his legs had basically been "pulpified." As it happens, his interrogators had already known -- and later testified -- that there was no evidence against Dilawar... "

Friday, January 8, 2010

Great Links Giving Insights Into Contemporary Predicaments

I'm a great fan of the series, The Century of the Self, which is available online.

The producer created another series I just found that was originally aired on BBC titled, The Power of Nightmares

This is a must see series that explores how "nightmares" have been used to mobilize the population.

I've also been reading alot about peak oil, resource depletion, and population pressures. I've read many times that the recession was ultimately precipitated by high oil prices, although the causes are very complex and involve the financialization of the economy (which itself is linked to energy prices).

A good powerpoint on the problem of resource depletion and population pressure can be found here
Meadow, Dennis

It is becoming clear to me that our unsustainable way of life and the global system predicated upon it is falling a part.

Unfortunately, our politicians lack the political will and power to help societies transition toward sustainable new ways of living.

The reading I've been doing is very sobering.

Thursday, January 7, 2010

Building a Better America

Dean Baker and Robert Pollin just released a paper titled "Public Investment, Industrial Policy and U.S. Economic Renewal"

Here is the complete abstract:

The U.S. economy faces enormous questions and challenges as it attempts to recover from the collapse of 2008-09. Some of the most pressing questions are a series of longer-term, structural challenges: Can we establish a growth engine driven by something other than financial bubbles? Can we renew the automobile industry and, more generally, reestablish a healthy manufacturing sector? Can we accomplish these various tasks while also rebuilding the economy on a new foundation of clean energy as opposed to fossil fuel energy sources?

Addressing these longer-term challenges is the over-arching theme of this paper.
Following an introductory discussion, in Section 2 we consider the overall evidence on the need for public investment in the traditional areas of transportation, energy, and water management. We then address the issue of financial crowding out. To do this, we examine evidence on how much of the U.S. economy’s financial resources have been flowing into productive private investments over time, as opposed to financial speculation. In Section 3, we then examine the U.S. ad hoc industrial policy, as it has been practiced both at the level of general manufacturing policies, such as with the auto bailouts, and in terms of technology incubation through the Pentagon. We consider ways of channeling these policy tools into supporting a strong technological base on a sustained basis. In Section 4, we bring together our discussions on public investment and industrial policies to sketch a policy ap-proach for supporting the revival of the U.S manufacturing sector, including the U.S. auto industry. In particular, we focus on the prospects for investments in public transportation: —to create an ex-panding market for U.S. automakers who are willing to convert part of their production lines to manufacturing buses and trains; to lower the costs of transportation for lower-income households; and to help advance the construction of a clean-energy economy in the United States.

Wednesday, January 6, 2010

US Financial Crisis Far From Over, Economists Say

This Reuters article, published at CNBC, cites major economists who argue that the recession is far from over. I agree. Why?

Mortgage delinquencies continue to rise.

Commercial real-estate is going under, fast.

Residential and commercial construction are down significantly from 2007.

States, cities and counties are going to have to make more cuts because sales taxes, income taxes, and corporate taxes continue to be down significantly from last year and even further down from 2007. Cuts will raise unemployment.

Retail sales figures from XMas show fewer sales than last year, although sales were for higher profits so retailers may be more profitable than last year. Go into a retail store and look at their inventory. Most stores are very bare.

Temporary sales people hired for the holidays will be let go.

The WSJ reported 1/6/2010 page C1 that "the nonmanufacturing sector comprises 88% of the economy."

The US has outsourced manufacturing.

The FIRE economy is still in distress.

How can the recession be over? What is going to drive economic "recovery"?

Tuesday, January 5, 2010

Outsourcing War

The wars against Iraq and Afghanistan are pointless and simply result in death and destruction.

That said, some enterprises see war as a business venture. The great film, War Inc., plays on this theme.

Mark Thoma, an academic economist, offers some data on the costs of outsourcing war in Iraq and Afghanistan.

"Last year, Congress concluded that each military contract worker cost $250,000 a year. As the Washington Post noted this month, Congress expects to save $44,000 per worker in the defense budget by "in-sourcing" about $5 billion worth of work now handled by contractors."

Each contractor cost 250,000 a year!

Why don't we end the wars that waste lives, money, and international goodwill!

Monday, January 4, 2010

Potentially Harmful Chemicals in Products Kept Secret

The Washington Post reports today that an obscure, 33 year old law shields chemicals in consumer products from outside review:

Of the 84,000 chemicals in commercial use in the United States -- from flame retardants in furniture to household cleaners -- nearly 20 percent are secret, according to the Environmental Protection Agency, their names and physical properties guarded from consumers and virtually all public officials under a little-known federal provision.

The policy was designed 33 years ago to protect trade secrets in a highly competitive industry. But critics -- including the Obama administration -- say the secrecy has grown out of control, making it impossible for regulators to control potential dangers or for consumers to know which toxic substances they might be exposed to.

Western Troops Accused of Killing Children

From the Times Online

"American-led troops were accused yesterday of dragging innocent children from their beds and shooting them during a night raid that left ten people dead.

Afghan government investigators said that eight schoolchildren were killed, all but one of them from the same family. Locals said that some victims were handcuffed before being killed.

Western military sources said that the dead were all part of an Afghan terrorist cell responsible for manufacturing improvised explosive devices (IEDs), which have claimed the lives of countless soldiers and civilians.

“This was a joint operation that was conducted against an IED cell that Afghan and US officials had been developing information against for some time,” said a senior Nato insider. But he admitted that “the facts about what actually went down are in dispute”.

Sunday, January 3, 2010

Provocative Critique of the Pillaging of the US

This polemic by Craig Harris gets at the outrage experienced by so many of us who really pay attention to what is going on. Here is an excerpt:

"During 2009, the leadership has taken actions which benefit the corporations and special interests who own them, while showing nothing but wanton disregard for the millions of citizens whose lives their sponsors have destroyed. What we are headed towards in the US if we are not there already, is a Straussian society of ultra rich, ultra powerful oligarchs and a serfish powerless population with no middle class to speak of. The US president De Jour is, and from here on out will be a yes man, subservient to the ultra powerful too big to fail oligarchs who control the money and power and are responsible for putting him in the drivers seat. This is not compatible whatsoever with prosperity, democracy or anything else the US still holds itself out as. Here at the end of 2009, the United States has morphed into a bankrupt fascist oligarchy which owns the military machine as a policy enforcement tool, the entire political body and the media. It isn't going to fix itself because the fraud, corruption and malfeasance is systemic. It meets every definition of organized crime and it's all happening right out in the open."

Friday, January 1, 2010

Andrew Bacevich on Endless War

Andrew J. Bacevich is a Prof. of International Relations and History at Boston Univ. He has written several books about the consequences of U.S. empire building and militarism.

In a recent post on CounterPunch, Bacevich describes our endless war in Afghanistan.

Here is an excerpt:

Americans today haven't a clue when, where or how their war will end. The Long War, as the Pentagon aptly calls it, has no coherent narrative. When it comes to defining victory, U.S. political and military leaders are flying blind.

Historically, the default strategy for wars that lack a plausible victory narrative is attrition. When you don't know how to win, you try to outlast your opponent, hoping he'll run out of troops, money and will before you do. Think World War I, but also Vietnam.

The revival of counterinsurgency doctrine, celebrated as evidence of enlightened military practice, commits America to a postmodern version of attrition. Rather than wearing the enemy down, we'll build contested countries up, while expending hundreds of billions of dollars (borrowed from abroad) and hundreds of soldiers' lives (sent from home).

I've read many analyses of why the U.S. is in Afghanistan. Some observers believe we are there in order to protect a Unocal pipeline that will allow gas to be transported to a port in India without going through Iran.

Others see our presence in Afghanistan as a continuation of the "Great Game" chronicled by Brzezinski. Which ever nation controls the region controls the world so this narrative goes.

Bacevich doesn't provide a definitive explanation but focuses instead on the pointless justifications used publicly to explain this endless war.

One thing is certain, the U.S. is increasingly resembling an authoritarian empire rather than embodying a beacon of democracy.