Sunday, March 31, 2013

Solar 'puts power in the hands of the little guy'

Solar power will soon have "grid parity" with coal and other dirty forms of power production. Germany is at the forefront. Meanwhile, solar panels on every house and in every backyard are making energy production local and distributive, instead of remote and concentrated:

By decentralizing power generation, the renewables boom could do to the power industry what the Internet did to the media: Put power in the hands of the little guy, and force power companies to rethink how they do business.

By Andrew Curry
March 29, 2013 | Slate

Tuesday, March 26, 2013

No Electoral College, no shenanigans

I can't support the Republican or the Democratic party on this one. I'm with the majority of Americans: let's scrap the stupid anachronistic elitist Electoral College altogether.

Instead let's elect our President by a national popular vote, just like every other democracy does. We're big boys and girls now, we can handle it.

By Amanda Terkel
March 25, 2013 | Huffington Post

DC Johnston: Average Americans $59 richer since 1966

Everybody's gotta read this. I'm not even gonna give you snippets, just read the whole thing.

My man David Cay Johnston is back on the case!

By David Cay Johnston
February 25, 2013 | Tax Analysts

14 million Americans collect disability

Did you know that, "The federal government spends more money each year on cash payments for disabled former workers than it spends on food stamps and welfare combined"?

Funnily enough though, "There's no diagnosis called disability:"

As far as the federal government is concerned, you're disabled if you have a medical condition that makes it impossible to work. In practice, it's a judgment call made in doctors' offices and courtrooms around the country. The health problems where there is most latitude for judgment -- back pain, mental illness -- are among the fastest growing causes of disability.

Unfortunately, "disability has also become a de facto welfare program for people without a lot of education or job skills." But just like regular welfare, it's not all glam and gold:

But going on disability means you will not work, you will not get a raise, you will not get whatever meaning people get from work. Going on disability means, assuming you rely only on those disability payments, you will be poor for the rest of your life. That's the deal. And it's a deal 14 million Americans have signed up for.

Basically, the number of adults -- and kids -- pulling disability checks has more than made up for the decrease in welfare recipients since Bill Clinton's Welfare To Work bill in 1994 that "ended Welfare as we know it."

By Chana Joffe-Walt | NPR

Sunday, March 24, 2013

Universe just got 80 million years older

This is pretty cool, awe-inspiring stuff. Turns out, the universe is 13.82 billion years old, about 80 million years older than previously thought. And it looks like a rugby ball.

By comparison, spaceship Earth is about 4.5 billion years old.  And it's round.

I wonder: what was God up to for the first 9.3 billion years before he made the Earth, and the first 13.8 billion years (or 13.829999 billion years, if you're a Creationist) before he made us? God must be a very meticulous planner.

By Jacob Aron
March 21, 2013 | New Scientist

'Inconclusive' link between public debt, interest rates

Empirical data refutes the conservative mantra that higher government debt always leads to higher interest rates, thereby "crowding out" private investment:  

In a paper published by the National Bureau of Economic Research in April 2005, Columbia University economist R. Glenn Hubbard and Federal Reserve economist Eric Engen declared as “inconclusive” the link between government debt and interest rates. Hubbard headed George W. Bush’s White House Council of Economic Advisers from 2001 to 2003.

“While analysis of the effects of government debt on interest rates has been ongoing for more than two decades, there is little empirical consensus about the magnitude of the effect, and the difference in views held on this issue can be quite stark,” they wrote.

In fact just the opposite can happen:

Deficits as a share of the U.S. economy have risen sharply at times with little to no discernible impact on the level of U.S. interest rates. In fact, just a cursory look at periods when the U.S. ran large deficits as a share of (the total economy) – 1983, 1991-92, 2008-2012 – we actually saw declines in nominal long-term (lending) rates,” said [Scott] Anderson [chief economist for Bank of the West in San Francisco].

He noted that the yield, or return on investment for bondholders, has not and did not rise sharply. “So the link between high levels of government spending and borrowing does not appear to raise the cost of money during these periods and therefore would not crowd out private consumption and investment,” Anderson said.

Just to show how fair & balanced I am, here's a recent WSJ op-ed that warns against a "fiscal dominance" scenario in the U.S., where debt-to-GDP consistently exceeds 80 percent, interest rates shoot up, debt increases even more, interest rates shoot up even higher, and a "fiscal death spiral" ensues.  Theoretically this is possible, but since this scenario depends a lot on "investor confidence," that means everything is relative.  Take Japan for example. Its debt-to-GDP ratio has been over 150 percent for years. It's now 225 percent. Yet Japan's borrowing costs remain low because of real deflation and the relative strength of the Japanese yen.  

By Kevin G. Hall
March 20, 2013 | McClatchy Newspapers

Saturday, March 23, 2013

Shiller: Higher taxes + stimulus to fix U.S. debt

Debt-Friendly Stimulus
By Robert J. Shiller
March 20, 2013 | Project Syndicate

With much of the global economy apparently trapped in a long and painful austerity-induced slump, it is time to admit that the trap is entirely of our own making. We have constructed it from unfortunate habits of thought about how to handle spiraling public debt.

People developed these habits on the basis of the experiences of their families and friends: when in debt trouble, one must cut spending and pass through a period of austerity until the burden (debt relative to income) is reduced. That means no meals out for a while, no new cars, and no new clothes. It seems like common sense – even moral virtue – to respond this way.

But, while that approach to debt works well for a single household in trouble, it does not work well for an entire economy, for the spending cuts only worsen the problem.  This is the paradox of thrift: belt-tightening causes people to lose their jobs, because other people are not buying what they produce, so their debt burden rises rather than falls.

There is a way out of this trap, but only if we tilt the discussion about how to lower the debt/GDP ratio away from austerity – higher taxes and lower spending – toward debt-friendly stimulus: increasing taxes even more and raising government expenditure in the same proportion. That way, the debt/GDP ratio declines because the denominator (economic output) increases, not because the numerator (the total the government has borrowed) declines.

This kind of enlightened stimulus runs into strong prejudices. For starters, people tend to think of taxes as a loathsome infringement on their freedom, as if petty bureaucrats will inevitably squander the increased revenue on useless and ineffective government employees and programs. But the additional work done does not necessarily involve only government employees, and citizens can have some voice in how the expenditure is directed.

People also believe that tax increases cannot realistically be purely temporary expedients in an economic crisis, and that they must be regarded as an opening wedge that should be avoided at all costs. History shows, however, that tax increases, if expressly designated as temporary, are indeed reversed later. That is what happens after major wars, for example.

We need to consider such issues in trying to understand why, for example, Italian voters last month rejected the sober economist Mario Monti, who forced austerity on them, notably by raising property taxes. Italians are in the habit of thinking that tax increases necessarily go only to paying off rich investors, rather than to paying for government services like better roads and schools.

Keynesian stimulus policy is habitually described as deficit spending, not tax-financed spending. Stimulus by tax cuts might almost seem to be built on deception, for its effect on consumption and investment expenditure seems to require individuals to forget that they will be taxed later for public spending today, when the government repays the debt with interest.  If individuals were rational and well informed, they might conclude that they should not spend more, despite tax cuts, since the cuts are not real.

[BTW, out of $788 billion paid out under the Recovery Act, aka stimulus bill, $291 billion of it went to tax cuts and credits that were not very stimulative. This was done at the GOP's insistence. - J]

We do not need to rely on such tricks to stimulate the economy and reduce the ratio of debt to income. The fundamental economic problem that currently troubles much of the world is insufficient demand. Businesses are not investing enough in new plants and equipment, or adding jobs, largely because people are not spending enough – or are not expected to spend enough in the future – to keep the economy going at full tilt.

Debt-friendly stimulus might be regarded as nothing more than a collective decision by all of us to spend more to jump-start the economy. It has nothing to do with taking on debt or tricking people about future taxes. If left to individual decisions, people would not spend more on consumption, but maybe we can vote for a government that will compel us all to do that collectively, thereby creating enough demand to put the economy on an even keel in short order.

Simply put, Keynesian stimulus does not necessarily entail more government debt, as popular discourse seems continually to assume. Rather, stimulus is about collective decisions to get aggregate spending back on track. Because it is a collective decision, the spending naturally involves different kinds of consumption than we would make individually – say, better highways, rather than more dinners out. But that should be okay, especially if we all have jobs.

Balanced-budget stimulus was first advocated in the early 1940’s by William Salant, an economist in President Franklin Roosevelt’s administration, and by Paul Samuelson, then a young economics professor at the Massachusetts Institute of Technology. They argued that, because any government stimulus implies higher taxes sooner or later, the increase might as well come immediately. For the average person, the higher taxes do not mean lower after-tax income, because the stimulus will have the immediate effect of raising incomes. And no one is deceived.

Many believe that balanced-budget stimulus – tax increases at a time of economic distress – is politically impossible. After all, French President Fran├žois Hollande retreated under immense political pressure from his campaign promises to implement debt-friendly stimulus. But, given the shortage of good alternatives, we must not assume that bad habits of thought can never be broken, and we should keep the possibility of more enlightened policy constantly in mind.

Some form of debt-friendly stimulus might ultimately appeal to voters if they could be convinced that raising taxes does not necessarily mean hardship or increased centralization of decision-making. If and when people understand that it means the same average level of take-home pay after taxes, plus the benefits of more jobs and of the products of additional government expenditure (such as new highways), they may well wonder why they ever tried stimulus any other way.

2,243...and rising

That's how many Americans were killed by guns since the Newtown shooting massacre when 20 children were shot and killed, many of them more than 10 times, their tiny bodies destroyed beyond recognition.

Here you can read some of the stories of recent victims.

By comparison, 2,191 U.S. troops were killed in Afghanistan since 2001.  We exceeded that KIA figure in just 3 months in the homeland, where we are definitely not secure.    

UPDATE (03.24.2013): Slate and the Twitter feed @GunDeaths have been crowdsourcing gun-deaths data, and on March 7, they came up with the figure of at least 2,923 Americans killed by guns since Sandy Hook. That's about as many Americans who were killed on 9/11, which sent us into spasms of rage and remorse and precipitated two disastrous wars that cost trillions of dollars. Yet the same number of deaths at home in the span of about 3 months doesn't give us a moment's pause.  

By Jason Cherkis
March 22, 2013 | Huffington Post

Rosenberg: Political 'moderation' is killing us

Rosenberg succinctly explains the destructive and yet politically successful behavior of today's Congressional Republicans:

If unreasonable positions ensure that the other side gets equal blame in the centrist's scorekeeping and resulting media coverage, then they are inherently "can't lose" positions. This provides a basic floor which biases the entire process against being reasonable.

If some sort of action is eventually necessary (as it is with budget issues, and most other governmental questions as well), then the unreasonable side - which by definition cares less (perhaps not at all) about real-world consequences - has an increasing advantage the longer that the issue remains unresolved, thus further motivating them to remain unreasonable. If they start at 50 percent (equal blame), things only get better for them over time, as the blame burden remains constant, but the cost pressure to do something rises much more accurately on the reasonable side.

In the process, argues Rosenberg, politically viable but unworkable political proposals get conflated with politically "serious," i.e. reasonable, ideas -- first among the MSM and with Washington elite, then among the wider public:

So why is the discussion dominated by a non-solution while a real solution can't even be discussed? It's because the "politically viable" sense of serious totally dominates over the "pragmatically effective" sense of the word, and because what is politically viable is circularly defined: extremist Republican non-solutions are politically viable because Republicans adamantly insist that they are, no matter how laughable they may be - and centrist bipartisan ideologues routinely and reliably endorse their false claims as matters of fact when they do so. The fact that they aren't even remotely serious, in the problem-solving sense, never even enters the picture.

And here Rosenberg sounds almost like Rush Limbaugh, who rejects bi-partisanship as an inherent political virtue:

Problem-solving and argument-winning have become two entirely antagonistic activities, and "moderate" "centrist" "bipartisanship" has become the creation of such profound confusion that the voting public won't catch on until it's far, far too late.

Today's Republicans are wrong and unreasonable. Any "middle ground" between their ideas -- the Paul Ryan budget, for example -- and reasonable progressive ideas is still wrong.  We cannot afford to call "less wrong" a job well done. We have big problems and we must be right!

By Paul Rosenberg
March 22, 2013 | Aljazeera

Thursday, March 21, 2013

What happens when everybody has drones?

As I said, I go back and forth on drones. They are some middle ground between doing nothing in the face of non-state terrorist groups and putting U.S. boots on the ground to futilely occupy countries where terrorists hide. Certainly the U.S. needs legal guidelines to check executive whims, especially when drones are used in countries where the U.S. does not have any other military presence. Drones are clearly a violation of other nations' sovereignty.

Beyond that, should the U.S. seek an international treaty or convention on drones?  Chances are other nations won't use them like we do. They won't have 200 analysts and decision-makers poring over the real-time data. No, they will use the drones for targeted killings on their borders, in their own tribal areas, and against near neighbors, and they won't sweat the details.

By Kristin Roberts
March 21, 2013 | National Journal

'Safety valve' to avoid mandatory sentences

Finally!  Lawmakers should make laws and let judges judge; they should not hamstring or box-in judges. Our federal prisons are bulging with non-violent drug offenders because of stupid mandatory sentencing rules that make judges irrelevant in the process.

By Mike Riggs
March 20, 2013 | Reason

We Need To Talk About JPMorgan

It's too facile and self-serving to call things that we simply disagree with "evil," but Eskrow makes a deliberate and compelling case why JPMorgan Chase is indeed an evil bank.  Sociopathic may be a better term. (You may also check out "JPMorgan Chase: Out of Control" by Joshua Rosner, an investment analyst at GrahamFisher.)

What else do you call a bank that pats itself on the back while paying over the past 4 years 20 percent of its net profit for fines and litigation? Name me another kind of firm that can tolerate -- and even brag about -- that kind of business model. 

How does JPMorgan tolerate it? At least three ways: 1) they get nearly free money from the Fed; 2) being Too Big To Fail lets them enjoy lower borrowing costs and higher stock price; and 3) their shareholders pay the fines and litigation fees, not the bank's directors like Jamie Dimon. As long as the managers get their fat paychecks, what do they care?

(Full disclosure: I actually have a Chase account. I don't have much choice, for now. However, most people's beef with Chase is not about how well it serves its retail clients, but how irresponsibly it gambles in risky securities and then tries to cover up its losses. Besides, Chase complained that it loses money on nearly half its retail banking clients. I hope I'm one of them.)

By Richard (RJ) Eskrow
March 20, 2013 | Huffington Post

Tuesday, March 19, 2013

U.S. still paying for Civil War, WWI...what about Afghanistan & Iraq?

This is fascinating. The USG is still paying survivors of WWI and children of Civil War vets:

If history is any judge, the U.S. government will be paying for the Iraq and Afghanistan wars for the next century as service members and their families grapple with the sacrifices of combat. 

This ought to make us think twice -- then twice more -- about sending our troops into battle.

By Mike Baker
March 19, 2013 | AP

Dying Iraq vet's letter to Bush-Cheney

Tomas Young's letter deserves to be posted in full.  Read it and support our troops.

P.S. -- My opposition to the Iraq occupation was the main reason I started this blog over six years ago. One of my first posts was a revenge fantasy written in sickened response to a brief, barely noticed AP article about how Dubya was "moved" during his annual pre-Christmas visit to wounded soldiers. When it dawned on me that this had already become a kind of holiday tradition for him and his wife, I knew the occupation was too old and institutionalized.  I don't know if Dubya still visits wounded Iraq vets; but he will certainly have the opportunity to continue visiting them until his dying day, even if he lives another 80 years, the smug fucker.

A Message to George W. Bush and Dick Cheney From a Dying Veteran
March 18, 2013 | Truthdig

To: George W. Bush and Dick Cheney
From: Tomas Young

I write this letter on the 10th anniversary of the Iraq War on behalf of my fellow Iraq War veterans. I write this letter on behalf of the 4,488 soldiers and Marines who died in Iraq. I write this letter on behalf of the hundreds of thousands of veterans who have been wounded and on behalf of those whose wounds, physical and psychological, have destroyed their lives. I am one of those gravely wounded. I was paralyzed in an insurgent ambush in 2004 in Sadr City. My life is coming to an end. I am living under hospice care.

I write this letter on behalf of husbands and wives who have lost spouses, on behalf of children who have lost a parent, on behalf of the fathers and mothers who have lost sons and daughters and on behalf of those who care for the many thousands of my fellow veterans who have brain injuries. I write this letter on behalf of those veterans whose trauma and self-revulsion for what they have witnessed, endured and done in Iraq have led to suicide and on behalf of the active-duty soldiers and Marines who commit, on average, a suicide a day. I write this letter on behalf of the some 1 million Iraqi dead and on behalf of the countless Iraqi wounded. I write this letter on behalf of us all—the human detritus your war has left behind, those who will spend their lives in unending pain and grief.

I write this letter, my last letter, to you, Mr. Bush and Mr. Cheney. I write not because I think you grasp the terrible human and moral consequences of your lies, manipulation and thirst for wealth and power. I write this letter because, before my own death, I want to make it clear that I, and hundreds of thousands of my fellow veterans, along with millions of my fellow citizens, along with hundreds of millions more in Iraq and the Middle East, know fully who you are and what you have done. You may evade justice but in our eyes you are each guilty of egregious war crimes, of plunder and, finally, of murder, including the murder of thousands of young Americans—my fellow veterans—whose future you stole.

Your positions of authority, your millions of dollars of personal wealth, your public relations consultants, your privilege and your power cannot mask the hollowness of your character. You sent us to fight and die in Iraq after you, Mr. Cheney, dodged the draft in Vietnam, and you, Mr. Bush, went AWOL from your National Guard unit. Your cowardice and selfishness were established decades ago. You were not willing to risk yourselves for our nation but you sent hundreds of thousands of young men and women to be sacrificed in a senseless war with no more thought than it takes to put out the garbage.

I joined the Army two days after the 9/11 attacks. I joined the Army because our country had been attacked. I wanted to strike back at those who had killed some 3,000 of my fellow citizens. I did not join the Army to go to Iraq, a country that had no part in the September 2001 attacks and did not pose a threat to its neighbors, much less to the United States. I did not join the Army to “liberate” Iraqis or to shut down mythical weapons-of-mass-destruction facilities or to implant what you cynically called “democracy” in Baghdad and the Middle East. I did not join the Army to rebuild Iraq, which at the time you told us could be paid for by Iraq’s oil revenues. Instead, this war has cost the United States over $3 trillion. I especially did not join the Army to carry out pre-emptive war. Pre-emptive war is illegal under international law. And as a soldier in Iraq I was, I now know, abetting your idiocy and your crimes. The Iraq War is the largest strategic blunder in U.S. history. It obliterated the balance of power in the Middle East. It installed a corrupt and brutal pro-Iranian government in Baghdad, one cemented in power through the use of torture, death squads and terror. And it has left Iran as the dominant force in the region. On every level—moral, strategic, military and economic—Iraq was a failure. And it was you, Mr. Bush and Mr. Cheney, who started this war. It is you who should pay the consequences.

I would not be writing this letter if I had been wounded fighting in Afghanistan against those forces that carried out the attacks of 9/11. Had I been wounded there I would still be miserable because of my physical deterioration and imminent death, but I would at least have the comfort of knowing that my injuries were a consequence of my own decision to defend the country I love. I would not have to lie in my bed, my body filled with painkillers, my life ebbing away, and deal with the fact that hundreds of thousands of human beings, including children, including myself, were sacrificed by you for little more than the greed of oil companies, for your alliance with the oil sheiks in Saudi Arabia, and your insane visions of empire.

I have, like many other disabled veterans, suffered from the inadequate and often inept care provided by the Veterans Administration. I have, like many other disabled veterans, come to realize that our mental and physical wounds are of no interest to you, perhaps of no interest to any politician. We were used. We were betrayed. And we have been abandoned. You, Mr. Bush, make much pretense of being a Christian. But isn’t lying a sin? Isn’t murder a sin? Aren’t theft and selfish ambition sins? I am not a Christian. But I believe in the Christian ideal. I believe that what you do to the least of your brothers you finally do to yourself, to your own soul.

My day of reckoning is upon me. Yours will come. I hope you will be put on trial. But mostly I hope, for your sakes, that you find the moral courage to face what you have done to me and to many, many others who deserved to live. I hope that before your time on earth ends, as mine is now ending, you will find the strength of character to stand before the American public and the world, and in particular the Iraqi people, and beg for forgiveness. 

No forgiveness for liberal Iraq hawks

No Forgiveness for Bush’s 'Useful Idiots,' the Liberal Hawks Who Led Us into War
By Michael Ratner
March 19, 2013 | AlterNet

Ten years ago, between January and April 2003, it is estimated that an unprecedented 36 million people around the world took to the streets in protest against the Iraq War. They believed the war unjust, the evidence of a threat flimsy, and the costs, in terms of lives and otherwise, potentially astronomical. Worldwide protests, from Rome to Manhattan, brought together hundreds of thousands, sometimes millions to collectively voice opposition.

In any just government, these astounding numbers would give pause to the war-wagers in power. In a truly democratic America, these sentiments should have been represented in Washington. And surely this moment should have been the cue for our “liberal media” to echo the cautionary cries of our protesters to deafening levels. Instead, our reliably bellicose Republican congressmen were joined in support by an overwhelming majority of our so-called liberal representatives, and war went ahead as planned.

Even more alarmingly, in the months preceding the start of the war, the pages of the  New York Times would greet us with more banging of the drums: a demand by Thomas Friedman that France be kicked out of the Security Council for its refusal to join up, or a startling piece of war propaganda by then soon-to-be executive editor Bill Keller, fantasizing about the impact of a one-kiloton nuke detonated in Manhattan – 20,000 incinerated, many more dying a “gruesome death from radiation sickness.” But make no mistake: although the New York Times has a shameless history of supporting war after war, other prominent mainstream journalists and intellectuals were eager to ride the bandwagon. These names include George Packer of the  New YorkerNewsday’s Jeffery Goldberg, the Atlantic’s Peter Beinart, Fareed Zakaria, Andrew Sullivan, Christopher Hitchens, Anne-Marie Slaughter, and Paul Berman to name a few.

The late Tony Judt sized up this whole lot most aptly with the label “Bush’s Useful Idiots.” The “useful idiots,” he said, were those from within the liberal establishment who, either through a misguided attempt to project strength, willfully played along with preposterous WMD claims, or simply allowed themselves to get carried away with the imperialistic fervor surrounding a new call to war, abdicating the responsibilities upon which liberal ideology is based. Instead, they aligned their positions with the neo-conservative architects of the Iraq War.

Since then, of course, we have seen one devastating report after another about the impact of the war: the allegedly misguided estimations of scope, length, Iraqi public opinion, and cost. We have also seen reports of a monumental death toll of Iraqis as a result of the war: 600,000 Iraqis have suffered violent deaths from the war, according to estimates by the Lancet. The number, as predicted, is staggering.

As the reports worsened, each of the “useful idiots” began issuing a mea culpa, asking passively for forgiveness. To this, we have to call out the stunning insincerity of these apologies, and reply with a “hell no” that embodies the ignored cries of the millions on the streets in 2003. We cannot be asked to believe that the elite of our liberal establishment could not see what millions of us screamed until our voices were hoarse.

To whom are these leaders really apologizing, and for what exactly? Not one of these apologies has been delivered to any of the millions of families in Iraq which have been destroyed forever. Not one of the apologies is for supporting the idea of a war that senselessly puts Iraqi lives on the line. Nor is there an apology for promoting a war founded on torture: when Ibn al-Shaykh al-Libi finally gave Bush administration officials the claims they were looking for, an obviously manufactured link between al Qaeda and Saddam Hussein, we did not hear the outcry against his torture that we hear in torture debates today. Nor were there serious inquiries into the reliability of the information even though it was clear, and as al-Libi himself later admitted, that he would have said anything to end the torture.

No: the apologies we hear are for the war’s lack of success; for the impact on their own brands and political capital.

What’s even more frightening is that nothing has happened to the political capital of these leaders. Hillary Clinton has issued her cursory apologies, and now finds herself as the front-runner candidate for the 2016 elections. Her apology is for making the wrong calculation in 2003, which likely cost her the presidency in 2008. 

But here is the real problem: the liberal establishment still has not learned its lessonsThose who opposed the Iraq War 10 years ago are exposed today, not as having some kind of stronger moral fortitude, but simply having made the right political calculation.  President Barack Obama will take his credit for ending the unpopular Iraq War, which he opposed as a senator. He will do so while dropping bombs in residential neighborhoods in Libya, and expanding the drone program, which kills scores of civilians, in Pakistan and now extending it into Yemen, Somalia, and soon, possibly, into Syria.

And just as 10 years ago, the media fails us today in carrying a real debate. Not one of the prominent thinkers and actors in our liberal establishment has reflected on the true costs of war, or made any changes to their decision-making priorities.

So today, as we look back on a criminal war, and a human rights catastrophe, we may as well be looking forward as well, because it looks exactly the same. Unless we truly hold those who betrayed their oath of office to account for the devastation they’ve caused, the useful idiots of our next war will be us.

Wolfowitz still defends Iraq invasion, 10 years on

Wolfowitz's lame apologetica doesn't even merit a response. Just let it be entered into the record, 10 years later.

Do take note that Wolfowitz, the "brains" behind Dubya's foreign wars, is now a scholar at the conservative American Enterprise Institute. John "Yosemite Sam" Bolton, Fred Kagan and Richard "Black" Perle are taking cover there, too.  I guess AEI is where discredited neocons go to die.

By Paul Wolfowitz
March 19, 2013 | FOX News

How fast we forget 'lessons learned' in Iraq!

Now here we have the "liberal" Washington Post's foreign affairs commentator Richard Cohen repeating his past mistakes in Afghanistan and Iraq -- mistakes he admitted to and regretted on the 10th anniversary of 9/11!

Once again he is urging the U.S. to get involved in a Middle Eastern war.  (The original title of his op-ed was, "Deadly delay on Syria.")

What skin does the U.S. have in this game?  Why should we take sides in a civil war, when the eventual victors, whoever they may be, are going to be pretty unsavory and undemocratic by our standards?  Haven't we learned anything?

Conservative MSM haters, take note, this is the real media bias when it comes to U.S. foreign policy: only "fools" talk about peace and non-interference, while the "realists" and grownups in Washington talk about how fast we can get our hands bloody.

UPDATE (03.21.2013):  Here's a look at the unsavory characters whom we'd be arming in Syria, if John McCain, et al, got their way.

By Richard Cohen
March 19, 2013 | Washington Post

Study: Class mobility in U.S. is a myth

This is all essential reading, I just wish BI wouldn't use the term "social mobility," when they are really discussing class mobility.

It's typical of Americans and especially the MSM to avoid the concept of class altogether, because we're supposed to be a classless society... or God forbid, some disgruntled conservative will accuse somebody of "class warfare!" Oh no!

By Eric Zuesse
March 18, 2013 | Business Insider

Sunday, March 17, 2013

Fed prez at CPAC: Break up TBTF banks!

The Left and the Right, perhaps for different reasons, may be converging on a consensus that it's time to break up the unmanageable Too Big To Fail banks.

About Dallas Fed President Richard Fisher's critique of Dodd-Frank, I would remind everybody that Congress has been been waiting for more than two years to adopt regulations while banking industry lobbyists have spent $400 million and submitted thousands of pages of comments and suggested corrections. Thus the very banks that say Dodd-Frank is overly complex are the same ones making it overly complex. For a detailed post-mortem of the Dodd-Frank bill, read Matt Taibbi's "How Wall Street Killed Financial Reform."

March 16, 2013 | Reuters
By Pedro Nicolaci da Costa

The largest U.S. banks are "practitioners of crony capitalism," need to be broken up to ensure they are no longer considered too big to fail, and continue to threaten financial stability, a top Federal Reserve official said on Saturday.

Richard Fisher, president of the Dallas Fed, has been a critic of Wall Street's disproportionate influence since the financial crisis. But he was now taking his message to an unusual audience for a central banker: a high-profile Republican political action committee.

Fisher said the existence of banks that are seen as likely to receive government bailouts if they fail gives them an unfair advantage, hurting economic competitiveness.

"These institutions operate under a privileged status that exacts an unfair tax upon the American people," he said on the last day of the annual Conservative Political Action Conference (CPAC).

"They represent not only a threat to financial stability but to fair and open competition (and) are the practitioners of crony capitalism and not the agents of democratic capitalism that makes our country great," said Fisher, who has also been a vocal opponent of the Fed's unconventional monetary stimulus policies.

Fisher's vision pits him directly against Fed Chairman Ben Bernanke, who recently argued during congressional testimony that regulators had made significant progress in addressing the problem of too big to fail. Bernanke asserted that market expectations that large financial institutions would be rescued is wrong.

But Fisher said mega banks still have a significant funding advantage over its competitors, as well as other advantages. To address this problem, he called for a rolling back of deposit insurance so that it would extend only to deposits of commercial banks, not the investment arms of bank holding companies.

"At the Dallas Fed, we believe that whatever the precise subsidy number is, it exists, it is significant, and it allows the biggest banking organizations, along with their many nonbank subsidiaries - investment firms, securities lenders, finance companies - to grow larger and riskier," he said.

Fisher argued Dodd-Frank financial reforms were overly complex and therefore counterproductive.

"Regulators cannot enforce rules that are not easily understood," he said. 

The morality of capitalism v. redistribution

Where to begin with the question "Is capitalism moral"? Let's start with the title. Kind of a loaded question. Anyway let's be precise. Pearlstein is really discussing political economy, i.e. how our laws and governance influence commerce and the general welfare. Pearlstein means to debate the role that government should play in the economy. 

To start, Pearlstein correctly notes that, "For most of the past 30 years, the world has been moving in the direction of markets," and yet increasingly over that same period we have "stagnant incomes, gaping inequality, a string of crippling financial crises and 20-somethings still living in their parents’ basements."

Thus Republicans have pivoted, Pearlstein says, to focusing on capitalism's moral superiority because they certainly can't make a prima facie case for capitalism's benefits. Unfortunately, Pearlstein takes their bait and tries to analyze, more or less objectively, which side -- the "free-market capitalists" or the "redistributionists" -- is indeed morally superior, and the flaws with each.

The truth, as with most things, is muddled and complicated.  But I want to lay down a few markers. First, very few liberals/progressives/Democrats insist on having this "moral" debate. Why? Because we liberals are outcome-based. By contrast, conservatives and free-marketeers believe that one's moral principles should determine the rules of the game, and if one's moral principles are sound, then ipso facto, the results will take care of themselves. More precisely, conservatives believe that economic results are morality-free; only our political economics must be morally sound.

Let's admit though that his whole debate has been predicated by recent shitty economic outcomes. For a liberal, a more appropriate question would be to ask: whose political economy is the most responsible for the shitty state of today's economy?  True liberals would be even more precise: what specific policies have led us to these terrible outcomes? Conservatives would obviously like to dodge this question, and instead talk in philosophical or moral abstractions, parables and anecdotes, because the facts -- the results -- of their 30 years of neo-liberal rule do not support the morality of their political economy.

Second marker: to quote Paul Rosenberg: "economics used to be called 'political economy', because the great classical economists never lost sight of the fact that economics was a thoroughly political activity, not something outside of the life of a political community." In other words, economics never, ever, ever happens in a political vacuum. Thus, the notion that, in some ideal country, the free-market capitalism of Adam Smith hums and churns along for the betterment of all, unfettered by and independent of government, is naive and silly. Government has a role to play, it sets the rules of the economic game, we all know that.  To what extent government is involved is a matter of degrees. 

Again, liberals believe that government's role should be evidence- or outcomes-based, i.e. tweaked according to the outcomes achieved, whereas conservatives believe that outcomes, like people, should take care of themselves. What's important for them is to set up a system of rigid, unchanging moral conditions under which people operate.

Third marker: noting the terrible results of recent deregulation, privatization-outsourcing and tax cutting is not the same as saying "capitalism is bad." Conservatives and perhaps Pearlstein would like to provoke us liberals into saying that. It's not necessary, or rather, it's an academic argument rather than a real one, since we have not had a "free-market" system for a very long time, if ever. Indeed the U.S. Government has been "meddling" in the economy for a very long time, just in different ways and to varying degrees. 

The recent political-economic bag is mixed: just as union membership has been plummeting, charter schools have been blooming, taxes on the One Percent were being cut, and regulations on Too Big To Fail banks were being torn down, so was USG spending on the military-industrial complex going through the roof (Afghanistan, Iraq, and the Department of Homeland Security apparatus), not to mention Dubya's tremendous addition to the Medicare entitlement -- altogether resulting in a 91 percent increase in our national debt from 2002-2009. 

To be sure, we also had the Great Recession from 2007-2009 that is almost entirely to blame for our persistently high unemployment and deficits since then. This begs the question: what political-economic philosophy was more responsible for the Great Recession? Because we wouldn't be having this discussion right now if it weren't for the Great Recession. You could skip all the junk I wrote above and below, and if you answer this one question correctly, then you are nearly at the truth....

But anyway, back to Pearlstein. He critiques liberals because "they have yet to articulate the moral principles with which to determine how far the evening-up [redistribution] should go -- not just with education but with child care, health care, nutrition, after-school and summer programs, training, and a host of other social services."  There are two big problems with where Pearlstein is going with this.

First, his critique is simply untrue. Liberals have laid out their moral principles, most eloquently in President Roosevelt's 1941 "Four Freedoms" speech that included the "freedom from want," and then in President Johnson's "Great Society" initiatives in the 1960s.  

In fact, our moral calculus is much easier to understand than conservatives'. We believe that, in the richest, most powerful nation in the history of the world, nobody should go hungry, uneducated or without health care. Furthermore, we believe that our nation's children, elderly and disabled deserve special care and protection, including additional food, medical and housing assistance. This is pretty easy to understand, and to verify. Can a child perform well in school relative to his peers? Does a person go hungry or malnourished? Does a child have a roof over his head? And so on. Depending on the answer, we have a moral obligation to do something. It couldn't be easier to understand.

Second problem: Pearlstein asks liberals to lay out: 1) our moral principles [check]; but also, unfairly, 2) a formula for government redistribution that is clear and will work forever and ever, amen. That's just childishly naive, I'm sorry. Pearlstein needs to get real. First, he ignores political reality that demands compromise. Nobody gets his way all the time, 100%. And let's just remind ourselves why this matters: if tomorrow President Obama would say that a "fair share" of taxes on the One Percent was, say, 30 percent, then this would be all anybody could talk about. Conservatives and their armies in think tanks, cable and talk radio would parse and mince it to death for weeks and months. When in fact it's all relative; and liberals don't care what the number is, as long as it generates sufficient revenues and ensures economic growth. (But historically, until the 1980s, the top marginal rate didn't fall below 70%).  At the end of his essay, Pearlstein admits as much:

Moral philosophers since Adam Smith have understood that free-market economies are not theoretical constructs -- they are embedded in different political, cultural and social contexts that significantly affect how they operate. If there can be no pure free market, then it follows that there cannot be only one neutral or morally correct distribution of market income.

Second, Pearlstein fails to acknowledge that liberals, unlike conservatives, think and act according to feedback loops: from problem/result --> intervention --> result/problem, and so on. Therefore, without observations of actual events, we cannot tell you what will be a fair and equitable taxation rate 5, 10 or 50 years from now, or a fair distribution of wealth. We won't even hazard a guess. 

Such tolerance for uncertainty drives doctrinaire conservatives to conniption. But that's a fundamental difference between us.  Therefore, a real liberal would start with our current and projected expenditures and sources of revenue and go from there; he wouldn't start the analysis with, "Well, it's just plain unfair and immoral for somebody to pay more than x percent of his gross income in taxes."  And besides, if that is my "moral" conviction, then how in the world can we debate that? We'd start at an impasse.

Pearlstein does argue that the distribution of economic rewards will shift over time, but liberals already know this:

[T]he way markets distribute rewards is neither divinely determined nor purely the result of the “invisible hand.” It is determined by laws, regulations, technology, norms of behavior, power relationships, and the ways that labor and financial markets operate and interact. These arrangements change over time and can dramatically affect market outcomes and incomes.

Pearlstein's next critique of liberals is that they "have been able to create a welfare state only by addicting a middle-class majority to government subsidies -- subsidies that now can be financed only by taking more and more money from the rich." 

Do I really need to cite statistics about tax and income inequality and the disappearing U.S. middle class?  If so, read thisthisthisthis and this. And don't even get me started about the $29 trillion bank bailouts, that primarily went to save financial markets in which the top One Percent owns 42 percent of all financial wealth, and the top 20 percent owns about 90 percent. The TBTF bank bailouts clearly demonstrate who is really "addicted" to Big Government and to what degree! 

Overall, although Pearlstein leans conservative, he touches on most of the important questions. The main take-aways from our debate are these:

  • Pure capitalism (or socialism, for that matter) has never existed anywhere, nor can it;
  • We are only worried about rising deficits and redistribution payments because of the Great Recession that in turn resulted from financial deregulation that conservatives support, even to this day;
  • Liberals should never feel obligated to justify the morality of their political economy, when if fact we are much clearer on this than conservatives who claim to care about the poor just as much as we do, yet have no idea how to remedy persistent poverty;
  • Liberals should not fall into conservatives' trap of naming "ideal" marginal tax rates, debt:GDP ratios, or anything of the kind, because 1) it's unwise tactically, in a political system that demands compromise, and 2) the correct answers will change over time.

A final note on political-economic morality: Pearlstein doesn't mention it but I will: conservatives' economic morality depends on personal pain and suffering. They firmly believe that pain teaches us lessons and can be personally redeeming; therefore, for redistributionist Big Government to deny a person the pain that he "deserves" is to deny him the chance to learn and improve himself.  

There is also a religious conservative variant of this belief: even if one's suffering wasn't caused by one's poor decisions, it may still be part of God's plan for that person; therefore, for redistributionist Big Government to prevent that pain and suffering is to interfere with God's plan for that person. Moreover, government assistance to a suffering person denies true Christians the opportunity to curry favor with God by performing charitable works for that suffering person. 

I hope I don't have to explain how sick and twisted such moral reasoning is, much less why it cannot be the basis for our country's political economy....

Finally, a note on redistribution. I will take the liberty here of quoting myself at length:

[L]et's recall for a minute what the U.S. Government -- any government from the dawn of human civilization -- actually does, in pure basics: it collects taxes from the people how it sees fit, and then spends that money how it wants. It does not, for example, say, "Mr. David Koch, since you contributed 0.01 percent of federal income tax revenues in FY 2011, we are allocating 0.01 percent of the FY 2012 federal budget to you."  

Since our government doesn't do this -- since no government has ever done this, ever -- then by definitionwhat our government does is redistribute wealth.  Moreover, sooner or later all government spending ends up in private hands -- just not necessarily (and not usually) in the hands that gave it its money in the first place.  If that's not redistribution then I don't know what is.

By Steven Pearlstein
March 15, 2013 | Washington Post