Thursday, July 8, 2010

Double-Dip? Catastrophe for Those Already Down, BP Worse Than Known & Shameful Stories on Children (Ugandan Evil) & CIA Drug Trafficking

(EXTRA: If anyone could make a contribution to my PayPal account (or otherwise - contact me for further info), it will be really, really, really appreciated as I'm in quite a pickle financially right now. I sincerely appreciate everything that my kind readers have done for me in the past financially and otherwise. Especially, otherwise, as the support group for this blog is beyond belief. My belief anyway. Again, my heartfelt thanks. . . and now . . . back to your regular viewing.) Robert Reich brings us more data defining the coming double dip (or just further down for most of us). (Emphasis marks added - Ed.)

The irony is that had there been no bank bailout in 2008 and 2009, no large stimulus, and no extraordinary efforts by the Fed to pump trillions of dollars into the economy, we’d have had another Great Depression. And because it would have sucked almost everyone down with it, the nation would have demanded from politicians larger and more fundamental reforms that might well have lifted everyone, and set America and the world on a more sustainable path toward growth and shared prosperity: A stimulus that financed the rebuilding of the nation’s infrastructure and alternative energies, single-payer health care, a cap on the size of big banks and resurrection of Glass-Steagall, earnings insurance, an Earned Income Tax Credit that extended into the middle class, and a truly progressive tax coupled with a price on carbon to pay for all of this over the long term.

No one in their right mind would have wished for another Great Depression, of course. But we seem to have got the worst of all worlds. The bank bailout, the stimulus, and the Fed brought us back from the brink just enough to dampen zeal for anything more. As a result, we are now slouching toward a tepid recovery that could just as well fall into a double dip recession, while a large portion of our population suffers immensely.

The economy is still in the gravitational pull of the Great Recession and all the booster rockets for getting us beyond it are failing. The odds of a double dip are increasing.

In June the nation added fewer jobs than necessary merely to keep up with population growth (private hiring rose by 83,000 after adding only 33,000 jobs in May). The typical workweek declined. Average earnings dropped. Home sales are down. Retail sales are down. Factory orders in May suffered their biggest tumble since March of last year. So what are we doing about it? Less than nothing. The states are running an anti-stimulus program (raising taxes, cutting services, laying off teachers, firefighters, police and other employees) that’s now bigger than the federal stimulus program. That federal stimulus is 75 percent gone anyway. And the House and Senate refuse to pass another one. (The Senate left Washington for the July 4th weekend without even extending unemployment benefits for millions of jobless Americans now running out.)

The second booster rocket – the Fed’s rock-bottom short-term interest rates – are having almost no effect. That’s because jobs and wages are so lousy that consumers don’t have enough money to buy much of anything, making small businesses bad credit risks and causing big ones to sit on the huge pile of cash they’ve accumulated.

Wall Street and the other biggest global banks, meanwhile, are making piles of money betting against government debt all over the world. These were the same banks and financiers, remember, that were bailed out by government not long ago. But now they’re demanding fiscal austerity, and politicians are once again doing their bidding – cutting deficits in every rich economy that should now be doing the reverse.

The people who are suffering the most from the failure of public officials and the greed of large bankers are the least able to endure it. Unemployment among people with four-year college degrees is barely over 5 percent; among high-school dropouts it’s over 25 percent. Those who have been jobless the longest or who have left the labor force altogether are men over fifty who are least likely to get back in. Families most in need are losing the services – state-supported Medicaid, child dental care, after-school programs for the kids, public transit – they most depend on.

Bob also entertains us with a personal story from the last Father's Day (and gives us some insight into his thoughts on the self-aggrandizing, and supremely self-serving, Ayn-Randite Alan Greenspan, revealing who Greenspan has been all along and whose interests he has well served - clearly someone who should never have been given any responsibility at the Federal level).

When I was a small boy at the start of the 1950s, my father gave me my first economics lesson. “Bobby,” he said with obvious concern, “you and your children and your children’s children will be repaying the national debt created by Franklin D. Roosevelt.”

I didn’t know what a national debt was, but I remember being scared out of my wits.

Dad was wrong, of course. Even though the national debt then was a much higher percentage of the national economy than it is today, it shrank as the economy boomed. My children have never mentioned FDR’s debt. My granddaughter (almost 2) will never pay a penny of it.

Dad, now 96 and still in good health, recognizes how wrong he was then. He admits FDR’s deficit spending not only won World War II but it also got America out of the Great Depression.

But now another gaggle of deficit hawks is warning us against more federal spending. “The current federal debt explosion is being driven by an inability to stem new spending initiatives,” warns Alan Greenspan in Friday’s Wall Street Journal, calling for budget cuts and saying “the fears of budget contraction inducing a renewed decline of economic activity are misplaced.”

My dad learned from his mistakes. Alan Greenspan obviously didn’t.

Contrary to Greenspan, today’s debt is not being driven by new spending initiatives. It’s being driven by policies that Greenspan himself bears major responsibility for.

Greenspan supported George W. Bush’s gigantic tax cut in 2001 (that went mostly to the rich), and uttered no warnings about W’s subsequent spending frenzy on the military and a Medicare drug benefit (corporate welfare for Big Pharma) — all of which contributed massively to today’s debt. Greenspan also lowered short-term interest rates to zero in 2002 but refused to monitor what Wall Street was doing with all this free money.

Years before that, he urged Congress to repeal the Glass-Steagall Act and he opposed oversight of derivative trading. All this contributed to Wall Street’s implosion in 2008 that led to massive bailout, and a huge contraction of the economy that required the stimulus package. These account for most of the rest of today’s debt.

If there’s a single American more responsible for today’s “federal debt explosion” than Alan Greenspan, I don’t know him.

But we can manage the Greenspan Debt if we get the U.S. economy growing again. The only way to do that when consumers can’t and won’t spend and when corporations won’t invest is for the federal government to pick up the slack.

For Greenspan now to say we don’t need more stimulus — when 15 million Americans are still out of work, when retail sales are dropping, when the rate of mortgage delinquencies is still in the stratosphere, when Europe and Japan are tightening their belts — is like Tony Hayward saying the Gulf spill shouldn’t worry us.

America’s long-term debt bomb is a future problem to be sure. But it has nothing to do with current spending initiatives. It will be due mainly to baby boomers’ demands for health care.

Our immediate challenge is to get enough demand back into the economy to pull ourselves out of the deep hole Greenspan helped create. That will require more deficit spending in the short term — relief to state and local governments, extended unemployment benefits, a one-year payroll tax holiday on the first $20K of income.

The $55 billion jobs bill now before Congress isn’t nearly big enough. Yet evidently it’s too big for Senate deficit hawks who blocked it Thursday before leaving town. Presumably Greenspan approves of this devastating lack of responsibility.

My father is a wise and loving man. I wish him a wonderful Father’s Day (the first of which was celebrated, incidentally, just four years before Dad was born).

Greenspan I can live without.

And it really does feel like the beginning of the Great Depression again according to more than one very knowledgeable economic history source. (Emphasis marks added - Ed.)

The US workforce shrank by 652,000 in June, one of the sharpest contractions ever. The rate of hourly earnings fell 0.1pc. Wages are flirting with deflation.

By Ambrose Evans-Pritchard

"The economy is still in the gravitational pull of the Great Recession," said Robert Reich, former US labour secretary. "All the booster rockets for getting us beyond it are failing."

July 04, 2010 The Telegraph

"Home sales are down. Retail sales are down. Factory orders in May suffered their biggest tumble since March of last year. So what are we doing about it? Less than nothing," he said.

California is tightening faster than Greece. State workers have seen a 14pc fall in earnings this year due to forced furloughs. Governor Arnold Schwarzenegger is cutting pay for 200,000 state workers to the minimum wage of $7.25 an hour to cover his $19bn (£15bn) deficit.

Can Illinois be far behind? The state has a deficit of $12bn and is $5bn in arrears to schools, nursing homes, child care centres, and prisons. "It is getting worse every single day," said state comptroller Daniel Hynes. "We are not paying bills for absolutely essential services. That is obscene."

Roughly a million Americans have dropped out of the jobs market altogether over the past two months. That is the only reason why the headline unemployment rate is not exploding to a post-war high.

Let us be honest. The US is still trapped in depression a full 18 months into zero interest rates, quantitative easing (QE), and fiscal stimulus that has pushed the budget deficit above 10pc of GDP.

The share of the US working-age population with jobs in June actually fell from 58.7pc to 58.5pc. This is the real stress indicator. The ratio was 63pc three years ago. Eight million jobs have been lost.

The average time needed to find a job has risen to a record 35.2 weeks. Nothing like this has been seen before in the post-war era. Jeff Weninger, of Harris Private Bank, said this compares with a peak of 21.2 weeks in the Volcker recession of the early 1980s."

Legions of individuals have been left with stale skills, and little prospect of finding meaningful work, and benefits that are being exhausted.

. . . "Republicans on Capitol Hill are filibustering a bill to extend the dole for up to 1.2m jobless facing an imminent cut-off. Dean Heller from Vermont called them "hobos". This really is starting to feel like 1932.

Washington's fiscal stimulus is draining away. It peaked in the first quarter, yet even then the economy eked out a growth rate of just 2.7pc. This compares with 5.1pc, 9.3pc, 8.1pc and 8.5pc in the four quarters coming off recession in the early 1980s.

The housing market is already crumbling as government props are pulled away. The expiry of homebuyers' tax credit led to a 30pc fall in the number of buyers signing contracts in May. "It is cataclysmic," said David Bloom from HSBC.

Federal tax rises are automatically baked into the pie. The Congressional Budget Office said fiscal policy will swing from a net +2pc of GDP to -2pc by late 2011. The states and counties may have to cut as much as $180bn.

Investors are starting to chew over the awful possibility that America's recovery will stall just as Asia hits the buffers. China's manufacturing index has been falling since January, with a downward lurch in June to 50.4, just above the break-even line of 50. Momentum seems to be flagging everywhere, whether in Australian building permits, Turkish exports, or Japanese industrial output.

On Friday, Jacques Cailloux from RBS put out a "double-dip alert" for Europe. "The risk is rising fast. Absent an effective policy intervention to tackle the debt crisis on the periphery over coming months, the European economy will double dip in 2011," he said.

It is obvious what that policy should be for Europe, America, and Japan. If budgets are to shrink in an orderly fashion over several years – as they must, to avoid sovereign debt spirals – then central banks will have to cushion the blow keeping monetary policy ultra-loose for as long it takes.

The Fed is already eyeing the printing press again. "It's appropriate to think about what we would do under a deflationary scenario," said Dennis Lockhart for the Atlanta Fed.

. . . Perhaps naively, I still think central banks have the tools to head off disaster. The question is whether they will do so fast enough, or even whether they wish to resist the chorus of 1930s liquidation taking charge of the debate. Last week the Bank for International Settlements called for combined fiscal and monetary tightening, lending its great authority to the forces of debt-deflation and mass unemployment.

If even the BIS has lost the plot, God help us.

Our friends at Veggie Revolution bring us this news that also ran in the Huffington Post. See? You never know what the MSM will cover (as long as it's deadly controversial).

Prescient or Pessimistic? Scientists Debate Possible Oil Spill Tsunamis

Thursday, June 24, 2010

Might the Gulf have its own way of wrapping up the BP oil spill? According to the Huffington Post, geologists speculate that this man-made disaster could result in a natural catastrophe far worse than what we've seen so far.Until now, the methane gas leaking from BP's damaged oil well has been overshadowed by the more overtly damaging oil leak. However, every barrel of oil that leaks is accompanied by close to 3000 cubic feet of natural gas, which is 75-90% methane.

Methane is already a notorious gas. Whiel it is highly useful for heating homes and powering the occasional school bus, it is also a potent greenhouse gas. When released into the atmosphere, it is 20 times more detrimental to the ozone layer than carbon dioxide.When released into water, it's not much better.

As the oil-gas mixture spews into the waters of the Gulf, ocean microbes gobble it up. However, as they feast, they also consume massive amounts of oxygen - like ketchup on their hotdogs. In the areas tainted by the BP oil spill, this feeding frenzy is using up all the available oxygen, resulting in dead zones of water.

These lifeless expanses, where no sea life can grow and no further oil can be broken down, could persist for years to come.While methane is inevitably released during oil drilling, it is typically released in controlled "kicks," or spurts. Apparently, more than a year ago geologists advised BP executives against the location of its ill-fated Macondo well. Seismic data from that area indicated a massive methane deposit in that area. Perhaps, then, the uncontrolled methane kick that sank the Deepwater Horizon platform on April 20 was not entirely unexpected.

But that's just the beginning of the potential disasters. The Huffington Post reports that new fissures or cracks in the ocean floor would be the first sign that methane trapped below the surface might be leaking. And indeed, as mitigation efforts continue, BP robotic submarines and live video feeds report new plumes, fissures, and cracks in the area surrounding the damaged rig.

If the gas did erupt, the disaster thus far would like like a day in the park in comparison. A gigantic bubble of flammable gas under rocketing skyward under massive pressure could cause an impressive array of disasters. Tsunamis could wreak havoc from Texas to Georgia, due to the force of the eruption or the subsequent vaporization of ocean water flooding the recently vacated cavity. Ships and other oil rigs could also sink, due to the loss of buoyancy.Will this happen? It's hard to say whether such predictions are realistic or over the top. If I lived on the Gulf shores, though, I'd have my suitcase packed.

Closed-door hearings? God knows - don't let the taxpayers in on what Congress (and many of the current players) did with their money earlier that led to so much current mayhem. Might as well cover this here as there are lots of very interesting stories about what happened in the past in this article, and although it's dated, the unreported situation in Afghanistan makes one newly cognizant about exactly how much our war economy has depended on the bloody connections inherent in the drug trade, doesn't it? But, relax, this is a just-for-fun article anyway as no one pays any attention to these facts at the top levels of our law-abiding government. For good reason (emphasis marks added - Ed.).

Unlike a court of law, which relies on specific charges, Congress, whose only mandate is to serve the people, may take any issue and go forwards or backwards in time. It may go sideways and change directions. It may call any witnesses it chooses in its efforts to decide what laws to write for the benefit of those it serves, The People.

Volume II of the CIA's Inspector General's Report took Congress to the CIA's house. It showed the dead body of its admissions regarding drug trafficking lying bloody in the open doorway. If Congress serves the people it will now enter the house and look around. It will press charges and it will see that criminals are punished for their crimes. It will pass laws designed to make sure that these crimes never happen again.

Use these 143 names as a report card to see what Congress' will really is and who it really serves. Volume II is not closed until the House Intelligence Committee holds hearings. Your calls, letters and e-mails to make those hearings complete and well covered are having a serious impact. Let's see what you can do with this.

Read on for the names and the bloody connections.

And on another interesting note (which just goes to show that no matter how bad things get, there is always something worse somewhere else (emphasis marks added - Ed.)):

A Comedy Writer Confronts ‘Mind-Shredding Evil’ in Uganda

An atheist South Park writer investigates the Lord’s Resistance Army and emerges with some unlikely heroes... By Frederick Clarkson British comedy writer and celebrity journalist Jane Bussmann had a revelation while interviewing actor Ashton Kutcher at a Hollywood café: She really had to find something more meaningful to do. So she embarked on a Google quest for the most evil man in the world and found Joseph Kony, head of the Uganda-based Lord’s Resistance Army. “In a dramatic change of direction,” according to the jacket of the resulting book:

[S]he set out for Africa to interview a respected (very attractive) peacemaker. However things did not go according to plan. Six weeks later, alone in a war-torn country, she found herself investigating one of the worst crimes in African history. Until one day, she was standing over a corpse in an open grave, wondering if she would get home alive . . . .

The paperback version of The Worst Date Ever: Or How It Took a Comedy Writer to Expose Africa’s Secret War was just released and a movie is “in development” by the producers of the Academy Award-winning film, Slumdog Millionaire. It may be the most ribald book about the atrocities of war you will ever read; you may, (as I did), find yourself laughing in the face of what Bussmann calls “mind-shredding evil.”

For two decades, Kony’s outfit has kidnapped tens of thousands of children; turned them into child soldiers and sex slaves; taught them to use rape as a weapon of war; and cut the lips off of critics including young children. Kony, his top commanders and their backer, Omar Hassan al-Bashir, president of Northern Sudan, are all wanted international war criminals. The LRA massacres whole villages at a time in Sudan, Uganda, Democratic Republic of the Congo, and Central African Republic. Two million people in Northern Uganda have been displaced.

Kony’s power over his victims is derived in part by his claim to be inhabited by spirits, including one that had jumped to him from Alice Lakwena (a kind of Joan of Arc figure), who led an unsuccessful rebellion against Ugandan President Yoweri Museveni in 1987. Some of Kony’s kids say they believe in his supernatural omniscience because he always knows exactly when the Ugandan Army is coming, in what numbers, and what kinds of weapons they are carrying.

Indeed. The occasional skirmish not withstanding, Kony has apparently enjoyed high-level assistance in sustaining his lifestyle while evading Ugandan troops ostensibly tasked with stopping him. Back in 1996, according to a document reprinted by Bussmann, the Ugandan and Sudanese governments knew exactly where Catholic school girls kidnapped by the LRA were being held. The Ugandan army had been tipped that the LRA was going to attack the elite St. Mary’s school, but had done nothing to protect or to rescue the 139 girls abducted. And yet, a brave school administrator, Sister Rachele, almost singlehandedly gained the release of 109 of the children. The LRA kept the rest — except for the one they hacked and tortured to death with machetes.

Sister Rachele and the girls’ parents met with world leaders from presidents Museveni and Bashir, to then-First Lady Hillary Clinton, to Kofi Annan, and Pope John Paul II.

“None of them got the girls back,” Bussmann observed.

“Meanwhile, Kony built his city of children in the desert and shipped in his prize, the highly educated St. Mary’s girls. The girls were raped, impregnated, given syphilis, and watched as babies were smashed against trees.”

When Bussmann arrived in 2005, parents were still trying to get their daughters back.

Mrs. Clinton had tried to help by getting the World Bank to donate. The Bank underwrote a special rehabilitation school for children who had escaped from the LRA. Unfortunately, one of Kony’s former top commanders, (an ex-bodyguard for president Museveni) was hired to run it.

Bussmann learned that this was more the rule than the exception. Writing on the Huffington Post she recently declared that some 20-66,000 children have been direct victims of what amounts to a “fake war.”

“But if everyone knew… why had nobody stopped him?” she wondered. “All around me, millions were being pumped into the effort.”

Only a cynic,” she continued, “could conclude that, far from trying to catch Kony, the world turned this mass child rapist into an industry, so I will, for one reason: I don’t see why the kids I met should have to put up with it.”

Read on for the rest of this shameful story that no one evidently could do anything about. Suzan ____________


libhom said...

I question the sincerity of a lot of the deficit hawks. We could eliminate our budget deficits by stopping the wars, getting rid of other unnecessary military spending, and making the rich pay their fair share in taxes. Yet, these options are never on the table.

Suzan said...

Question it?

They have some?

I read an exposure of Peterson's gambit over a decade ago (and have written about it often since then), and it hasn't changed (and neither has his/their fraudulent "concern" for the deficit caused by the profligate spending on social welfare programs for the lower classes).

The whole argument boils down to changing the subject to blaming the poor and taxing them harder to make them forget what caused the deficits in the first place.

Clinton screwed up by placing that small tax on the wealthy (which worked out so well in fact and actually caused deficit reduction) in order to show good faith to his backers/voters when he should have just realized that he would only call down the wrath of the elite gods upon his poor soon-to-be-impeached-for-being-lower-class head.

And don't tell me about how he was praised by the Warren Buffet crowd, et al., who supposedly thought highly of him for slightly raising their taxes.

Just try to remember how that worked out for him until he became lovey-dovey with that Bushy sect (and he's GHWB's favorite adopted son now - remember - according to granddaughter Jenna our news reporter from the top).

And remember where Rahm Emanuel got his push. Right!

And Hillary's our "Bomb Bomb Bomb Iran" proud-as-punch Secretary of State now.

Mysteriously appointed by our "change" candidate.

I guess I'll have to document it again.

Thanks for commenting!


I question the sincerity of a lot of the deficit hawks.