Does The U.S. Really Have A Fiscal Crisis? Why "Delusion" Is An Ironclad Defense for the Well Connected

Before we get into the fraudulent U.S. Deficit Crisis (and I have the highest regard for Simon Johnson's opinion), we need to look at how all the perpetrators of this crisis got off - and even the smaller fish who are swimming away now into relatively unpolluted waters ready to let loose again. All I can think is what do you expect out of an administration that chose Larry Summers and Timmy Geithner (both Rubin boys) to run his Treasury/economic recovery team? And how is this better than McCain again? Somebody remind me, please!

I saw The Postman again last night on free TV (Thanks, TNT!). I hope our citizens don't get down that low before the people understand fully the forces of evil (who have decided to take advantage of their good nature and civilized way of dealing with brigands), and band together to save the United States of America and not just the plutocracy at the top. (P.S. In the essays below, the writer doesn't use all caps to shout. He's just trying to say that if you don't read anything else, please read that.) (Emphasis marks and some editing inserted - Ed.)

EDITOR’S NOTE: There is only one reason why there are not over 1,000 prosecutions that would successfully land the perps in jail — the reason is that the perps are the ones actually in charge. This is not rocket science. It is complex but it is not abstract requiring the intellect of Einstein. It takes elbow grease but not brilliance to make the case for fraud. ANY COMMON CITIZEN — A POTENTIAL JURY MEMBER — CAN MAKE THE CONNECTION BETWEEN WHAT HAPPENED ON WALL STREET AND WHAT HAPPENED ON MAIN STREET. IT WAS ALL PART OF ONE TRANSACTION. THE MONEY CAME FROM WALL STREET TRANSACTIONS AND WAS USED IN BITS AND PIECES ALL THE WAY DOWN TO USING PART OF THE INVESTOR MONEY TO FUND MORTGAGE LOANS. WHAT DO YOU THINK WE SHOULD DO?

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Biggest Fish Face Little Risk of Being Caught By Joe Nocera February 25, 2011 Late last week, word leaked out that Mr. Mozilo, who had co-founded Countrywide Financial in 1969 — and, for nearly 40 years, presided over its astonishing rise and its equally astonishing fall — would not be prosecuted by the Justice Department.

Not for insider trading. Not for failing to disclose to investors his private worries about subprime loans. Not for helping to create a culture at Countrywide in which mortgage originators were rewarded for pushing fraudulent loans on borrowers.

In its article about the Justice Department’s decision, The Los Angeles Times said prosecutors had concluded that Mr. Mozilo’s actions “did not amount to criminal wrongdoing.”

Just months earlier, the Justice Department concluded that Joe Cassano shouldn’t take the fall for the financial crisis either.

Mr. Cassano, you’ll recall, is the former head of the financial products unit of the American International Group, a man whose enthusiasm for credit-default swaps led, pretty directly, to the need for a huge government bailout of A.I.G.

There was a time when it appeared that there was no way the government would let Mr. Cassano walk. But it did.

And then there’s Richard Fuld, the man who presided over Lehman Brothers’ demise. Though he was the subject of an investigation shortly after the Lehman bankruptcy, it appears that prosecutors are moving on.

Most of the other Wall Street bigwigs whose firms took unconscionable risks — risks that nearly brought the global financial system to its knees — aren’t even on Justice’s radar screen. Nor has there been a single indictment against any top executive at a subprime lender.

The only two people on Wall Street to have been prosecuted for their roles in the crisis are a pair of minor Bear Stearns executives, Ralph Cioffi and Matthew Tannin, whose internal hedge fund, stuffed with triple-A mortgage-backed paper, collapsed in the summer of 2007, an event that anticipated the crisis. A jury acquitted them.

Two and a half years after the world’s financial system nearly collapsed, you’re entitled to wonder whether any of the highly paid executives who helped kindle the disaster will ever see jail time — like Michael Milken in the 1980s, or Jeffrey Skilling after the Enron disaster. Increasingly, the answer appears to be no. The harder question, though, is whether anybody should. • Aficionados of financial crises like to point to the savings-and-loan debacle of the 1980s as perhaps the high-water mark in prosecuting executives after a broad financial scandal. When the government loosened the rules for owning a thrift, the industry was taken over by aggressive entrepreneurs, far too many of whom made self-dealing loans using savings-and-loan deposits as their own personal piggy banks.

In time, nearly 1,000 savings and loans — a third of the industry — collapsed, costing the government billions. According to William K. Black, a former regulator who teaches law at the University of Missouri, Kansas City, “There were over 1,000 felony convictions in major cases” involving executives of the thrifts. Solomon L. Wisenberg, a lawyer who writes for a blog on white collar crime, said, “The prosecutions were hugely successful.” That is partly because the federal government threw enormous resources at those investigations. There were a dozen or more Justice Department task forces. Over 1,000 F.B.I. agents were involved. The government attitude was that it would do whatever it took to bring crooked bank executives to justice. The executives howled that they were being unfairly persecuted, but the cases against them were often rooted in a simple concept: theft. And as prosecutors racked up victories in court, they became confident in their trial approach, and didn’t back away from taking on even the most well-connected thrift executives, like Charles Keating, who owned Lincoln Savings — and who eventually went to prison. Today, Mr. Black says, the government doesn’t have nearly as many resources to pursue such cases. With the F.B.I. understandably focused on terrorism, there isn’t a lot of manpower left to dig into potential crimes that may have taken place during the financial crisis.

Fewer than 150 of the bureau’s agents are assigned to mortgage fraud, for instance. Several lawyers who represent white collar defendants told me that outside of New York, there aren’t nearly enough prosecutors who understand the intricacies of financial crime and know how to prosecute it. It is a lot easier to prosecute people for old-fashioned crimes — robbery, assault, murder — than for financial crimes. Which leads to another point: as Sheldon T. Zenner, a white collar criminal lawyer in Chicago, puts it, “These kinds of cases are extraordinarily difficult to make. They require lots of time and resources. You have some of the best, highest-paid and most sophisticated lawyers on the other side fighting you at every turn. You are climbing a really high mountain when you try to do one of these cases.” Take, again, the one big case that prosecutors have brought, against Mr. Cioffi and Mr. Tannin. The Bear Stearns executives had written numerous e-mails expressing their fears and anxieties as the fund began to sink. Prosecutors viewed those e-mails as smoking guns, proof that the men had withheld important information from their investors. Thanks largely to those e-mails, prosecutors saw the case as a slam dunk. But it wasn’t. For every e-mail the executives wrote predicting the worst, they would write another expressing their belief that everything would be O.K. Besides, expressing such fears publicly would have doomed the fund, because liquidity would have instantly vanished.

Instead of viewing Mr. Cioffi and Mr. Tannin as crooks, the jury saw them as two men struggling to make the best of a difficult situation. By the time the trial was over, the e-mails, in their totality, made the defendants seem sympathetic rather than criminal. It seems safe to say that the government’s failure to convict those two Bear Stearns executives has caused prosecutors to shy away from bringing other cases. After all, the case against Mr. Cioffi and Mr. Tannin was supposed to be the easy one. By contrast, a case against Angelo Mozilo would have been, from the start, a much harder one to win. Although the Justice Department never filed charges against Mr. Mozilo, one can assume that its case would have been similar to the civil case brought earlier by the Securities and Exchange Commission. (On the eve of the trial date last fall, the S.E.C. blinked and settled with Mr. Mozilo.) One of the S.E.C.’s charges was insider trading — that Mr. Mozilo sold nearly $140 million worth of stock after he knew the company was in trouble. But the defense countered by pointing out that Mr. Mozilo was selling his stock under an automatic selling program that top corporate executives often use — thus mooting the insider trading accusation. Like the Bear Stearns executives, Mr. Mozilo had written his share of e-mails expressing worries about some of Countrywide’s loan practices. He called one of Countrywide’s subprime products “the most dangerous product in existence, and there can be nothing more toxic.” The government argued that Mr. Mozilo had a legal obligation to share that information with investors. But this case, too, would have been awfully difficult to make. Countrywide’s descent into subprime madness was hardly a secret. It made all sorts of crazy adjustable rate mortgages that required no documentation of income; its array of products was also well known and disclosed to investors. Indeed, Mr. Mozilo was quite vocal and public in saying that the housing market was due to fall, and fall hard. But he always assumed that whatever its losses, Countrywide was so strong that it would be one of the survivors and would feast on the carcasses of its former competitors. No internal e-mail he wrote contradicted that belief. Was there outright fraud at Countrywide? Of course there was. That is a large part of the reason that Bank of America, which bought Countrywide in early 2008, has struggled so mightily with the legacy of all the Countrywide loans now on its books. But most of the fraudulent actions at Countrywide took place at the bottom of the food chain, at the mortgage origination level. It has been well-documented that mortgage brokers induced borrowers to take loans that they never understood, and often persuaded them to lie on their loan applications. That kind of predatory lending is against the law — and it should be prosecuted. But going after small-time mortgage brokers isn’t nearly as satisfying as putting the big guy in jail, especially a big guy like Mr. Mozilo, who symbolizes to many Americans the excesses and wrongdoing embodied in the subprime lending mess. The problem is that Mr. Mozilo, though he helped create the culture that made such predatory lending acceptable, never made the fraudulent loans himself. Legally, if not morally, he’s off the hook. A few days ago, I listened to a recording of a lengthy interview with Mr. Mozilo conducted by investigators working for the Financial Crisis Inquiry Commission and posted recently on the commission’s Web site. It was a remarkable performance; Mr. Mozilo expressed no regrets and no remorse. He extolled subprime loans as a way to allow lower-income Americans to get a piece of the American dream and “really build wealth” — just like people used to do during the housing bubble. He bragged that Countrywide, unlike the too-big-to-fail banks, never took a penny of government money. He said that Countrywide had helped put 25 million Americans in homes. His voice rising passionately, he said finally, “Countrywide was one of the greatest companies in the history of this country.” Which is a final reason Mr. Mozilo would have been difficult to prosecute. Delusion is an iron-clad defense.

February 26, 2011 The Revolution Will Be Globalized

America’s greatest strategic concern heading into the 2010’s was Iran’s nuclear program. U.S. policymakers must already view this recent history as the “good old days.” In fact, a nuclear bomb did go off after Tunisia's split atom sent shock waves across the Muslim world and Africa. Tunisians now celebrate their personal achievement in bringing down "the Arab wall of silence."

From Tunisia protests spread like a virus, infecting neighbor Algeria and hopping planes to Egypt, Mauritania, and Yemen. A dozen states had been hit by the time former Hosni Mubarak retreated to Sharm el-Sheikh. Two weeks later and, accounting for a variety of symptoms, 20 states display contact with Tunisia’s radiation. Does The U.S. Really Have A Fiscal Crisis? By Simon Johnson The United States faces some serious medium-term fiscal issues, but by any standard measure it does not face an immediate fiscal crisis. Overindebted countries typically have a hard time financing themselves when the world becomes riskier – yet turmoil in the Middle East is pushing down the interest rates on US government debt. We are still seen as a safe haven. Yet leading commentators and politicians today repeat the line “we’re broke” and argue there is no alternative other than immediate spending cuts at the national and state level. Which view is correct? And what does this tell us about where our political system is heading? Our main fiscal issues are three (see mytestimony to the Senate Budget Committee earlier this month). The most immediate problem is that our largest banks and closely related parts of the financial system blew themselves up in 2007-08. The ensuing recession and associated loss of tax revenue will end up pushing up our government debt, as a percent of GDP, by around 40 percent. Very little of this debt increase was due to the fiscal stimulus; mostly it was caused by lower tax revenue, because of the slump in output and employment.

The financial system poses a major risk to our fiscal outlook over the next few years. Unless you think that the Dodd-Frank reform bill really ended “too big to fail” and the associated excessive risk-taking culture, you should worry a great deal about the boom-bust-bailout-fiscal damage scenario that the Bank of England now refers to routinely as the “doom loop”. Of the national level politicians now pushing for spending cuts, almost none showed up to fight to contain the fiscal risks posed by our largest banks. The Brown-Kaufman amendment to Dodd-Frank – which would have placed a limit on the size and debt (relative to equity) was supported by 33 Senators, only a handful of whom were Republican. But, then again, the Obama administration also fought hard against Brown-Kaufman. Treasury Secretary Tim Geithner argues that the TARP bank bailouts will end up costing the tax payer very little. He is forgetting the broader fiscal damage done by the collapse of the real economy and the loss of 8 million jobs. Second, we need to control healthcare spending as a percent of GDP. The issue is most definitely not about cutting the current level of such spending or immediately reducing the benefits in Medicare (although if you have ideas for that, send them along). But in the projections, by 2030 or 2040, the growth of healthcare spending ruins us all – whether or not we get the government to pay for it. During the healthcare debate of 2009-10 there was very little attempt to explain this issue and discuss the options. The administration made a half-hearted move in this direction but backed away as soon as leading Republicans began to claim there were “death panel” proposals on the table. Third, our tax system is completely antiquated. For the same level of tax revenue relative to GDP, we could greatly reduce the distortions (e.g., disincentives to work) just by modernizing. The right and the left agree we should tax consumption more and income less, but neither is willing to make any kind of meaningful move towards a value added tax (VAT). The right seems afraid that this tax will be too effective and power an expansion of government. The left thinks a VAT is necessarily regressive (imposing more burden on poorer people), despite all the evidence that the impact of VAT depends on how it is designed – because you can choose what gets zero taxes (e.g., baby clothes) and high taxes (e.g., yachts). The only room for bipartisan consensus here seems to be what we got in December 2010 – a big tax cut. Cutting taxes is nice, but only it is consistent with keeping the budget on a sustainable path. How does the Republican initiative to cut spending fit in with these budget issues? Not very much is the generous answer. Their proposed cuts at the federal level are for discretionary nonmilitary spending, but this is small as a percent of the budget (and therefore of the economy). But the problem here is bipartisan – as it was with the tax cut last year. None of the leadership on either side is willing to talk openly about how our biggest banks caused great fiscal damage. No one is willing to explain why our healthcare costs continue to rise. And no top politicians currently champion real tax reform. The Republicans have seized a moment. To them, this is not really about fiscal responsibility; this is about an opportunity to shrink the size of government. But the Democrats have played perfectly into their hands. The heart of their mistake was the president’s refusal to explain clearly how the financial system produced a recession that has pushed up our national debt. Both sides of our political elite have contributed to the sense of fiscal crisis. And as we continue down this path – dangerous big banks, out of control health care spending, significant tax cuts, small changes in nonmilitary discretionary spending, and irresponsible rhetoric on both sides – we are well on our way to a real crisis.

The War on Women

February 25, 2011

Republicans in the House of Representatives are mounting an assault on women’s health and freedom that would deny millions of women access to affordable contraception and life-saving cancer screenings and cut nutritional support for millions of newborn babies in struggling families. And this is just the beginning.

The budget bill pushed through the House last Saturday included the defunding of Planned Parenthood and myriad other cuts detrimental to women. It’s not likely to pass unchanged, but the urge to compromise may take a toll on these programs. And once the current skirmishing is over, House Republicans are likely to use any legislative vehicle at hand to continue the attack. The egregious cuts in the House resolution include the elimination of support for Title X, the federal family planning program for low-income women that provides birth control, breast and cervical cancer screenings, and testing for H.I.V. and other sexually transmitted diseases. In the absence of Title X’s preventive care, some women would die. The Guttmacher Institute, a leading authority on reproductive health, says a rise in unintended pregnancies would result in some 400,000 more abortions a year. An amendment offered by Representative Mike Pence, Republican of Indiana, would bar any financing of Planned Parenthood. A recent sting operation by an anti-abortion group uncovered an errant employee, who was promptly fired. That hardly warrants taking aim at an irreplaceable network of clinics, which uses no federal dollars in providing needed abortion care. It serves one in five American women at some point in her lifetime. The House resolution would slash support for international family planning and reproductive health care. And it would reimpose the odious global “gag” rule, which forbids giving federal money to any group that even talks about abortions. That rule badly hampered family planning groups working abroad to prevent infant and maternal deaths before President Obama lifted it. (Mr. Obama has tried to act responsibly. He has rescinded President George W. Bush’s wildly overreaching decision to grant new protections to health providers who not only will not perform abortions, but also will not offer emergency contraception to rape victims or fill routine prescriptions for contraceptives.) In negotiations over the health care bill last year, Democrats agreed to a scheme intended to stop insurance companies from offering plans that cover abortions. Two bills in the Republican House would go even further in denying coverage to the 30 percent or so of women who have an abortion during child-bearing years. One of the bills, offered by Representative Joe Pitts of Pennsylvania, has a provision that would allow hospitals receiving federal funds to refuse to terminate a pregnancy even when necessary to save a woman’s life. Beyond the familiar terrain of abortion or even contraception, House Republicans would inflict harm on low-income women trying to have children or who are already mothers. Their continuing resolution would cut by 10 percent the Special Supplemental Nutrition Program for Women, Infants and Children, better known as WIC, which serves 9.6 million low-income women, new mothers, and infants each month, and has been linked in studies to higher birth weight and lower infant mortality. The G.O.P. bill also slices $50 million from the block grant supporting programs providing prenatal health care to 2.5 million low-income women and health care to 31 million children annually. President Obama’s budget plan for next year calls for a much more modest cut. These are treacherous times for women’s reproductive rights and access to essential health care. House Republicans mistakenly believe they have a mandate to drastically scale back both even as abortion warfare is accelerating in the states. To stop them, President Obama’s firm leadership will be crucial. So will the rising voices of alarmed Americans. _____________________

(The Bremer Troops Are At It Again!) Shock Doctrine, U.S.A. (Krugman) The G.O.P.’s Abandoned Babies

But don’t expect either Mr. Walker or the rest of his party to change those goals.

No. Do not. That's what they are there for.


[On a side note first off, I'd like to remind my readers that this is my quarterly fundraiser time. If you would like to donate any amount to the maintenance of this blog, it will be deeply appreciated. As a terminally unemployed software engineer/programmer/project manager, I thank you for your kind decision to help.]

Talk about baby killers . . . these Rethugs never practice what they preach. Unless their messages are sotto voce. (Emphasis marks added - Ed.)

The G.O.P.’s Abandoned Babies By Charles M. Blow February 25, 2011 Republicans need to figure out where they stand on children’s welfare. They can’t be “pro-life” when the “child” is in the womb but indifferent when it’s in the world. Allow me to illustrate just how schizophrenic their position has become through the prism of premature babies.

Of the 33 countries that the International Monetary Fund describes as “advanced economies,” the United States now has the highest infant mortality rate according to data from the World Bank. It took us decades to arrive at this dubious distinction. In 1960, we were 15th. In 1980, we were 13th. And, in 2000, we were 2nd.

Part of the reason for our poor ranking is that declines in our rates stalled after premature births — a leading cause of infant mortality as well as long-term developmental disabilities — began to rise in the 1990s.

The good news is that last year the National Center for Health Statistics reported that the rate of premature births fell in 2008, representing the first two-year decline in the last 30 years.

Dr. Jennifer L. Howse, the president of the March of Dimes, which in 2003 started a multimillion-dollar premature birth campaign focusing on awareness and education, has said of the decline: “The policy changes and programs to prevent preterm birth that our volunteers and staff have worked so hard to bring about are starting to pay off.”

The bad news is that, according to the March of Dimes, the Republican budget passed in the House this month could do great damage to this progress. The budget proposes:

• $50 million in cuts to the Maternal and Child Health Block Grant that “supports state-based prenatal care programs and services for children with special needs.”

• $1 billion in cuts to programs at the National Institutes of Health that support “lifesaving biomedical research aimed at finding the causes and developing strategies for preventing preterm birth.”

• Nearly $1 billion in cuts to the Centers for Disease Control and Prevention for its preventive health programs, including to its preterm birth studies.

This is the same budget in which House Republicans voted to strip all federal financing for Planned Parenthood.

It is savagely immoral and profoundly inconsistent to insist that women endure unwanted — and in some cases dangerous — pregnancies for the sake of “unborn children,” then eliminate financing designed to prevent those children from being delivered prematurely, rendering them the most fragile and vulnerable of newborns. How is this humane?

And it doesn’t even make economic sense.

. . . This type of budgetary policy is penny-wise and pound-foolish — and ultimately deadly. Think about that the next time you hear Republican representatives tout their “pro-life” bona fides. Think about that the next time someone uses the heinous term “baby killer.”

Please read the whole essay. And on a related subject, I love it when Paul Krugman says exactly what I've been saying for the last decade. Finally. But it is reaaaaally evident now. (Can you believe that Paul Bremer* has even a better job now? Gotta keep those Rethugs recycling.) (Emphasis marks added - Ed.)

Shock Doctrine, U.S.A.

Here’s a thought: maybe Madison, Wis., isn’t Cairo after all. Maybe it’s Baghdad — specifically, Baghdad in 2003, when the Bush administration put Iraq under the rule of officials chosen for loyalty and political reliability rather than experience and competence.

As many readers may recall, the results were spectacular — in a bad way. Instead of focusing on the urgent problems of a shattered economy and society, which would soon descend into a murderous civil war, those Bush appointees were obsessed with imposing a conservative ideological vision.

Indeed, with looters still prowling the streets of Baghdad, L. Paul Bremer, the American viceroy, told a Washington Post reporter that one of his top priorities was to “corporatize and privatize state-owned enterprises” — Mr. Bremer’s words, not the reporter’s — and to “wean people from the idea the state supports everything.”

The story of the privatization-obsessed Coalition Provisional Authority was the centerpiece of Naomi Klein’s best-selling book The Shock Doctrine, which argued that it was part of a broader pattern.

From Chile in the 1970s onward, she suggested, right-wing ideologues have exploited crises to push through an agenda that has nothing to do with resolving those crises, and everything to do with imposing their vision of a harsher, more unequal, less democratic society.

Which brings us to Wisconsin 2011, where the shock doctrine is on full display.

In recent weeks, Madison has been the scene of large demonstrations against the governor’s budget bill, which would deny collective-bargaining rights to public-sector workers. Gov. Scott Walker claims that he needs to pass his bill to deal with the state’s fiscal problems. But his attack on unions has nothing to do with the budget. In fact, those unions have already indicated their willingness to make substantial financial concessions — an offer the governor has rejected.

What’s happening in Wisconsin is, instead, a power grab — an attempt to exploit the fiscal crisis to destroy the last major counterweight to the political power of corporations and the wealthy. And the power grab goes beyond union-busting. The bill in question is 144 pages long, and there are some extraordinary things hidden deep inside.

For example, the bill includes language that would allow officials appointed by the governor to make sweeping cuts in health coverage for low-income families without having to go through the normal legislative process.

And then there’s this: “Notwithstanding ss. 13.48 (14) (am) and 16.705 (1), the department may sell any state-owned heating, cooling, and power plant or may contract with a private entity for the operation of any such plant, with or without solicitation of bids, for any amount that the department determines to be in the best interest of the state.

Notwithstanding ss. 196.49 and 196.80, no approval or certification of the public service commission is necessary for a public utility to purchase, or contract for the operation of, such a plant, and any such purchase is considered to be in the public interest and to comply with the criteria for certification of a project under s. 196.49 (3) (b).”

What’s that about? The state of Wisconsin owns a number of plants supplying heating, cooling, and electricity to state-run facilities (like the University of Wisconsin). The language in the budget bill would, in effect, let the governor privatize any or all of these facilities at whim.

Not only that, he could sell them, without taking bids, to anyone he chooses. And note that any such sale would, by definition, be “considered to be in the public interest.”

If this sounds to you like a perfect setup for cronyism and profiteering — remember those missing billions in Iraq? — you’re not alone. Indeed, there are enough suspicious minds out there that Koch Industries, owned by the billionaire brothers who are playing such a large role in Mr. Walker’s anti-union push, felt compelled to issue a denial that it’s interested in purchasing any of those power plants. Are you reassured?

The good news from Wisconsin is that the upsurge of public outrage — aided by the maneuvering of Democrats in the State Senate, who absented themselves to deny Republicans a quorum — has slowed the bum’s rush.

If Mr. Walker’s plan was to push his bill through before anyone had a chance to realize his true goals, that plan has been foiled. And events in Wisconsin may have given pause to other Republican governors, who seem to be backing off similar moves.

But don’t expect either Mr. Walker or the rest of his party to change those goals. Union-busting and privatization remain G.O.P. priorities, and the party will continue its efforts to smuggle those priorities through in the name of balanced budgets.

* In late 2001, along with former Attorney General Edwin Meese, Bremer co-chaired the Heritage Foundation's Homeland Security Task Force, which created a blueprint for the White House's Department of Homeland Security. For two decades Bremer has been a regular at Congressional hearings and is recognized as an expert on terrorism and internal security. Some of Bremer's published work includes "Warfare & Defence Military Science Alliance Response to Nuclear Weapons Proliferation", "The Alliance Response to Nuclear Weapons Proliferation: Deterrence, Defense, and Cooperative Options", and "Countering the Changing Threat of International Terrorism: Report from the National Commission on Terrorism", the New York Times article "What I Really Said About Iraq", and his first book, My Year In Iraq: The Struggle to Build a Future of Hope.

. . . On February 6, 2007, Bremer appeared before a Congressional committee investigating fraud and abuse and was questioned about what happened during his tenure as head of the CPA and to respond to conclusions from a January 2005 audit report, including the missing $8.8 billion U.S. of Iraq's money and the chosen accounting method of these funds.

Bremer currently serves as Chairman of the Advisory Board for GlobalSecure Corporation, a company whose focus is "on securing the homeland with integrated products and services for the critical incident response community worldwide," and on the board of directors of BlastGard International, Inc., a company located in Florida that manufactures materials to mitigate the impact of explosions. (Standard and Poor's Register)

Bremer and wife Frances, the spokeswoman for the National Fibromyalgia Association, travel around the country to help raise public awareness about fibromyalgia, a medical condition that some claim afflicts 10 million Americans and five percent of the world's population. He is a member of the board of directors of the International Republican Institute. ___________________

Budget Crisis? Whatever You Do - Don't Tax the Rich! (Where the $$$ Hides Behind Smirks of Caring)

Because it's really, really hard to find those offshore accounts in the Caymans, etc.?

Not really. (Emphasis marks added - Ed.)

A great tragedy of the United States is that the answer to many of the country’s domestic problems is obvious, even simple, but can’t be done because of a dominating political/media dynamic that rules that solution out. The solution to these many problems – from the budget deficit to crumbling infrastructure, from mass joblessness to income inequality, from environmental degradation to educational shortfalls – is to raise taxes on the rich and to use that money to get the United States back on track and advancing toward the future.

And there are clear justifications for doing so, from practicality to fairness. Though many multi-millionaires fancy themselves self-made men (and women), the truth is that they all have profited from investments that American taxpayers have made over the decades, and even centuries.

For instance, President Dwight Eisenhower’s inter-state highway system enabled companies to move their goods more cheaply; President John Kennedy’s space program spurred the growth in computer sciences; the Pentagon created the Internet (yes, with critical support from Al Gore when in Congress), which revolutionized commerce and spread information.

These innovations and many more were achieved by the federal government using taxpayers’ money. Yes, entrepreneurs in their garages and dorm rooms did expand on these breakthroughs and deserve credit and a share of the profits, but they also should pay back at a much higher rate for the taxpayer-funded R&D that made their fortunes possible.

An even-stronger tax justification applies to Wall Street, where the greed and gambling of bankers tipped the economy into a severe recession just three years ago, costing millions of Americans their jobs and homes. To avoid an even worse outcome – a new depression – the federal government and Federal Reserve authorized trillions of dollars in bailouts.

To further calm Wall Street, the authorities essentially gave the bankers a “get out of jail free” card. Not a single prominent player in the sub-prime securities scandal has been prosecuted or forced to surrender much in ill-gotten gains.

Instead, many of the top Wall Street bankers are lining up again for massive paydays in the tens of millions of dollars, essentially skimming off profits that were achieved only because the U.S. government poured vast sums of public money into the financial sector. Yet, many of these same bankers insist that their taxes remain at historically low levels.

Other wealthy Americans have enriched themselves through holdings in multinational corporations that fattened their bottom lines by laying off middle-class Americans and hiring cheaper replacement workers overseas.

Not only did these American workers see their lives damaged by the exporting of their jobs but they face the indignity of helping to foot the bill for the gigantic U.S. military which protects the global interests of these multinationals.

And that ain't all. How about another very easy way to ease the budget deficits? (Emphasis marks added - Ed.)

U.S. Endless-War Budget Rolls On Another part of Ronald Reagan’s insidious legacy is that any politician or pundit who dares to question excessive U.S. military spending can expect to be denounced as “soft” on whomever the enemy du jour is. To protect themselves from such attacks, Democrats have typically lined up behind the Pentagon’s budget almost as slavishly as Republicans have, a pattern that is continuing in the Obama administration . . . . Under President Barack Obama's new budget for fiscal year 2012, the Great American War Machine just rolls on and on. . . . When Defense Secretary Robert Gates warned that major cuts in military spending would be “catastrophic,” Obama settled for chopping $78 billion in cosmetic cuts Gates recommended over the next five years. . . . Some observers, by the way, think the Pentagon is, in fact, already running the show. Chalmers Johnson wrote in Blowback that the Pentagon is “close to being beyond civilian control”; that it “more or less sets its own agenda” and that it “monopolizes the formulation and conduct of American foreign policy.” So, in fiscal year 2012, which begins next Oct. 1, the Pentagon will just have to struggle along with $719 billion while the president calls for a five-year freeze on “non-security” discretionary spending such as, in the words of former Labor Secretary Robert Reich, “programs the poor and working class depend on – assistance with home heating, community services, college loans, and the like.” Obama will get a lot of help from the Republican Party, which, of course, will not rein in spending for unjust wars but in a fit of what AFL-CIO's Manny Herrmann calls “budget insanity” plans to chop up Head Start, Pell Grants, food and job safety inspections, eliminate “hundreds of thousands of middle-class jobs,” cut investment in infrastructure, and even cut the money needed “to send out Social Security checks.” Herrmann might have added Obama also seeks to slash nearly half the federal funds to help low-income families heat their homes.

Because you know those poor people only have themselves to blame (although, of course, there is all that lovely Koch-ed up moolah floating about these proceedings). After all, they voted for them. (Remember Wackenhut? How could we forget - other than that the MSM don't actually report on important current events anymore?)

Wisconsin's Right-Wing Radical Walker’s boasting about his ideological schemes is just the latest evidence that his legislative assault on labor unions is not about saving money, but is really about giving Republicans even a greater financial advantage in upcoming elections, an anti-democratic strategy . . . . It’s not just Wisconsin Gov. Scott Walker’s recent efforts to strip public employees of their right to collectively bargain that have citizens of his state outraged. Walker is nothing short of a radical hell-bent on privatizing the public sector of Wisconsin. Last year, he exhibited similar dictatorial tendencies in his immediately previous role as a Milwaukee County Executive when he proposed laying off 27 security guards working for Milwaukee County and replacing them with nonunion private employees.

When the County Board nixed his proposal, Walker unilaterally pushed it through anyway, citing a budgetary emergency. He laid off the workers, and hired new ones through a $1.1 million contract with the UK-based security firm Wackenhut.

And the problems compounded. The head of the newly constituted security force, Chad H. Wegener, turned out to have five misdemeanor convictions. A criminal complaint had also been filed against Wegener for drunk and disorderly conduct and for making unwelcome sexual advances on his male subordinates. Wegener was dismissed.

Walker’s staff had calculated the privatization of the guards would save the County more than $750,000. Months later, that estimate had been revised down to $411,000. And now, even those savings will be lost, as an arbitration board ruled in January that Walker acted improperly and the guards have to be rehired, with back pay costing as much as $430,000, a net loss for the County, thanks to Walker’s rash, unilateral act.

It doesn’t appear that the county will appeal the ruling.

Walker had also forced the layoff of nine airport employees, also in the name of a budgetary emergency. Supervisor John Weishan told the Milwaukee Journal Sentinel, however, that the layoffs hadn’t saved the county any money and were really aimed at punishing the county union officials who had not bowed to Walker’s demands for concessions.

Walker’s latest battles were triggered by his budget bill, which includes provisions to dramatically reduce public union bargaining rights. But now that protests have shed light on the bill, activists in Wisconsin are continuing to discover other disturbing provisions of the bill.

One provision would give the Governor power to change Medicaid in the state with little input from the public. According to the Wisconsin State Journal on Feb. 20, under the bill, 50,000 people could lose coverage while others could face increased rates and reduced benefits.

New power to revise fees and benefits paid would be handled solely by the Legislature’s budget committee instead of the full legislature.

And still, it gets worse.

This same bill also proposes to privatize state-owned power plants. This same plan had been proposed -- and defeated -- in 2005. Opponents had successfully argued that such a move would raise the cost of energy, because once sold, there’d be no way to maintain control over prices.

It’s no wonder that the Koch brothers – the billionaire owners of the Kansas-based energy company Koch Industries – are backing Walker to the hilt, and have even opened a lobbying office in Madison just a block from the Wisconsin state capitol.

While some have speculated their goal in backing this legislation is to buy the soon-to-be-privatized power stations, others see a more sinister scenario: overseeing the dismantling of as much government and publicly controlled property as possible as a matter of principle.

This is not even about money. This is a raw power play to thwart democratic power on all fronts.

And if you saw the news today, you know how this has worked out in the Wisconsin Assembly. The trick is that it's not really a citizen groundswell. More like a geyser.

The Wisconsin Assembly early Friday passed a bill that would strip most public workers of their collective bargaining rights — the first significant action on the new Republican governor's plan.

And no one on the 'thug team (Blue Dogs/Rethugs/street thugs) values the American worker. At all. (Emphasis marks added - Ed.)

As the latest showdown to dominate American politics, the battle between Wisconsin’s governor and public employees carries many unspoken messages. It tells us, for instance, that Republicans do not see collective bargaining as a fundamental human right. It also suggests that Democrats are willing—finally!—to draw a line in the sand. But most important of all, it shows what government really sees as its top priority.

Recall that in recent years, we’ve witnessed two separate debates over two types of taxpayer-subsidized laborers. First, we saw a brief argument over how much taxpayer money should pay government-sponsored bankers on Wall Street. Now, we’re having a more prolonged discussion about how much taxpayer money should pay public employees in our schools, police departments, fire departments and infrastructure agencies.

The first set of workers, underwritten by ongoing multitrillion-dollar Treasury and Federal Reserve bailouts, mostly cannibalize wealth through foreclosures and speculation. The second set of workers, by contrast, primarily create and protect wealth through educating kids, preventing fires and crimes, and building public assets.

To the government-funded bankers, we’ve applied the notion of “you get what you pay for.” Thus, our government has refrained from ending exorbitant pay packages at taxpayer-funded banks in the name of “retaining talent.” That was the mantra of politicians and publicly subsidized financial executives when they weakened proposals to cap annual bank salaries at $500,000. Though an astronomical sum, one Wall Street adviser told reporters that half a million bucks “is not a lot of money,” while others repeated a talking point from a corporate report insisting that government-sponsored banks would “experience a talent drain” if barred from paying employees millions.

Of course, this same idea of paying a premium to retain talent is nowhere in our discussion about the other set of public workers. Instead, we mostly hear politicians and media voices berating teachers, firefighters and police officers as “freeloaders” or “welfare cases.”

This, despite the Economic Policy Institute reporting that these non-bank public employees make 3.7 percent less than those in similar private-sector jobs.

Taken together, this may seem like a double standard, but it’s actually a consistent, if abhorrent, statement of priorities in an age of avarice—an age in which financial executives can grossly outspend middle-class workers on campaign contributions.

In this corrupt system, public compensation decisions by bought-off elected officials highlight a larger corporatist ideology—one that says attracting the best and brightest to the “greed is good” financial industry is more important than attracting that work force to common-good endeavors.

But they have no Koch-dollars. So they (we) lose. The march of fascism never relents until faced and defeated. Oh, and FYI - I just heard that the following question yelled out in a town hall meeting with Rep. Paul Broun, R-Ga., was met by raucous laughter in the formerly great state of Georgia.

"Who is going to shoot President Obama?"

Figures.

And you've undoubtedly heard that Rahmbo (Rahm Israel - no lie - Emanuel) was annointed the new Mayor of Chicago. I'm teary-eyed at the thought that this boy who came up from nothing is now triumphant over our world. Go RAHM! (to hell) (Emphasis marks added - Ed.)

The Illinois Democrat raised more than $12 million since leaving the White House in October 2010 for his mayoral campaign. Interestingly, only 46 percent - or $5.38 million - of the contributions Emanuel received came from Chicago residents. The rest of the contributions were from donors from outside of the Windy City, according to the Daily Caller. Emanuel is a prolific fund-raiser and has an extensive career in business and politics. In 1992, he was the director of then-Gov. Bill Clinton’s presidential campaign finance committee and in this role Emanuel raised an astonishing $72 million. From 1993 to 1998, Emanuel served in the Clinton Administration as the assistant to the president on political affairs, and, later, as senior adviser for policy and strategy. In these roles, he took charge of leading health care reform and other domestic issues. By 1998, Emanuel left the White House and joined Wassertein Perella, an investment bank. In 2000, Emanuel was appointed to the board of directors of Freddie Mac, the government-sponsored mortgage company.

And you know how that worked out?

Are there any states left where this is not de rigueur?

And, of course, another very liberal Democrat has joined another firm that lobbies hard.

But not for liberal agendas.

Former New Mexico Gov. Bill Richardson, a Democrat, can add another title to his extensive resume of public and private sector careers. On Wednesday, Richardson joined APCO Worldwide, a global public relations firm, according to The Hill.

Richardson will be working as the chairman of the company’s executive advisory service, Global Political Strategies (GPS), according to a press release.

Richardson’s previous extensive background in government includes a tenure as a seven-term congressman, the U.S. Ambassador to the United Nations, the Secretary of Energy during the Clinton Administration and a two-term governor of New Mexico.

Richardson was a presidential candidate for the Democratic nomination in 2008. During the campaign he raised $18.6 million, but he dropped out after finishing fourth in the New Hampshire primary.

During 2010, APCO Worldwide reported earning $3.3 million in lobbying income and spent $470,000 to hire ML Strategies to lobby lawmakers, according to an analysis by the Center For Responsive Politics.

Well, I guess this is all okay and above board as long as they aren't trading on inside information. ________________

Alan Greenspan Takes Credit For The Financial Crisis (Stays Cheerful Always About Stealing You Blind!) & Paulson's Scheme Exposed Finally

I should have known that someone would write this article. Wish it had been me. (Click on the title link and don't miss the comments. They're priceless! (Actually this whole essay is.))

Alan Greenspan Takes Credit For The Financial Crisis “The morning after we learned of the news,” Greenspan said of the Dow Jones plunging 6.98 percent that day in September 2008, “I was able to look myself in the mirror and say, ‘Hey, not bad.’” Sure, if he’d tried just a little harder he could’ve done better – 10 percent would’ve been a dream – but really, all things considering, not bad! Solid B+ work.

Hey, pretty good, huh? You knew it too, of course. After all, look at them now. Here's the original. Remember how this Paulson made his last billions?* (Please read the comments!) Think what you will. But read all the essays first.

Tisch Hall's Paulson Auditorium was packed last night as NYU Stern Alumni Alan Greenspan and John Paulson spoke about their experiences and gave their insights on politics and the economy.

Greenspan began the conversation with a reminder that graduating from an academic institution is "only the beginning." To support this, Paulson then highlighted Greenspan's illustrious career in the public sector.

Greenspan commended all the presidents with whom he had worked, particularly Gerald Ford.

However, the conversation soon turned from politics to the current economic climate.

Greenspan brought up the fateful day in September 2008 when the Dow Jones industrial average plunged 6.98 percent. However, life picked up for him after the initial shock.

"The morning after we learned of the news," he said, "I was able to look myself in the mirror and say, 'Hey, not bad.'"

According to Paulson, the recovery process has been rather "tepid." Greenspan attributed the slow recovery to excessive government activism.

"What I'd suggest is that we calm down; let the economy heal by itself," he said. "But we are doing better now with the halting of more stimului and programs like 'Cash for Clunkers."

Greenspan also emphasized that the future health of the housing sector would depend on the phasing out of "contradictory" government-instilled institutions like Freddie Mac and Fannie Mae, whose objective of providing affordable housing conflicted with the necessity to "maximize profit for shareholders."

The interview wrapped up with a question the majority of the audience was anxious to have answered.

"There is general worry about the decline in U.S. economic global leadership," Paulson said. "Do you still have confidence in the future of the United States?"

Greenspan responded: "Whenever I get gloomy, I think of Winston Churchill: 'America always does the right things ... after it has tried every other viable alternative."

If you haven't seen All the King's Men, you should. You missed it the other night on TCM, but you can rent it today. I think the Broderick Crawford portrayal of the Willie Stark character (think any Blue Dog/Rethug) can't be beat. Think Governor of Wisconsin. (Emphasis marks added - Ed.)

Ten Ways Alan Greenspan Cheers Himself Up When He’s Feeling Blue Bess Levin At a talk at NYU earlier this week, Alan Greenspan told John Paulson, “Whenever I get gloomy, I think of Winston Churchill. America always does the right things … after it has tried every other viable alternative.” Being pressed for time they had to go on to the next question, but if they’d had longer, Big Al would’ve shared all his tricks for turning that frown upside down. They include: 1. Thinking about one of the last conversations he had before retiring, when Ben Bernanke was weighing taking the job and came into his office and asked what kind of shape things were in and he said “We’re lookin’ good!” with a straight face. (Seriously, that one never fails to crack him up, even today.) 2. Reminiscing about Barbara Walters’ tits. 3. (And when memory won’t suffice, digging out the nudie shots she sent him when they were dating). 4. Annoying the shit out of Andrea Mitchell by following up every statement with “The Oracle Hath Spoken!” through a megaphone. (“Pick up some Lunchables while you’re at the store - The Oracle Hath Spoken!” “Don’t bother me when I’m in the Man Cave - The Oracle Hath Spoken!” “I need some new socks – The Oracle Hath Spoken!”)

5. Reruns of Silver Spoons (Alfonso Ribeiro is his spirit animal). 6. Staring at the ‘Maestro’ tattoo he had inked on his dick. 7. Getting off on the fact that in his day, being such a market-moving BSD, Goldman would have chemists analyzing his tissue spunk to determine how elevated his testosterone levels were and if it would influence his policy-making. 8. Remembering all the people he put in touch with Angelo Mozilo to take out option ARMS on houses they really couldn’t afford and how they literally got their asses torn out. (This can pull him out of even the worst of funks.) 9. Practicing feigning a look of shock when Lady Gaga pulls him on stage during her performance at the MTV Music awards, should he be invited. 10. Thinking about all the times Bernanke would call him freaked out in Fall 2008, and how he’d interrupt every story to pick up call waiting and then after clicking back, say “So where were we? Oh, right, you were telling me what you were wearing.” And two minutes before the end of every call go, “I’m sorry, to whom am I speaking?"

_ _ _ _ _ _ _ _ _ _ *John Paulson and the Greatest Pump and Short Fraud Ever By now, everybody knows that the market for collateralized debt obligations was riddled with fraud in the lead-up to the financial crisis. What is less known is the fact that hedge fund managers helped create and inflate the market for these toxic securities specifically so that they could bet against them and profit from the inevitable collapse. An example of a particularly sordid scheme, orchestrated by hedge fund billionaire John Paulson, was discovered some time ago by David Fiderer, a blogger for the Huffington Post. The information in Fiderer’s blog is rather incriminating, and, of course, the mainstream media is not on the case, so I think it bears repeating. In a close reading of Wall Street Journal Gregory Zuckerman’s book, The Greatest Trade Ever, an otherwise starry-eyed account of Paulson’s bets against the mortgage market, Fiderer discovered this nugget:

“Paulson and [partner Paolo Pellegrini] were eager to find ways to expand their wager against risky mortgages. Accumulating it in the market sometimes proved to be a slow process. So they made appointments with bankers at Bear Stearns, Deutsche Bank (NYSE:DB), Goldman Sachs (NYSE:GS), and other banks to ask if they would create CDOs that Paulson & Co. could essentially bet against.”

As Fiderer explains, Paulson asked the banks to create those CDOs “so that they could be sold to some suckers at close to par. That way, Paulson’s hedge fund could approach some other sucker who would sell an insurance policy, or credit default swap, on the newly minted CDOs. Bear, Deutsche and Goldman knew perfectly well what Paulson’s motivation was. He made no secret of his belief that the CDOs subordinate claims on the mortgage collateral were close to worthless. By the time others have figured out the fatal flaws in these securities which had been ignored by the rating agencies, Paulson could collect up to $5 billion. “Paulson not only initiated these transactions, he also specified the terms he wanted, identifying which mortgages would be stuffed into the CDOs, and how the CDOs should be structured. Within the overall framework set by Paulson’s team, banks and investors were allowed to do some minor tweaking.” It is not clear which banks ultimately participated in Paulson’s scam, but Fiderer quotes Bear Stearns trader Scott Eichel as saying that his bank refused. “It didn’t pass the ethics standards;” Eichel said, “it was a reputation issue and it didn’t pass our moral compass. We didn’t think we could sell deals that someone was shorting on the other side.” Bear Stearns’ moral compass was usually pointed towards the darker regions, but perhaps this is why Paulson subsequently became one of the more eager short sellers of Bear Stearns’ stock. Fiderer continues: “Prior to 2006, there were not many opportunities for naked short selling on subprime securitizations. But in January of that year, investment banks launched a new product, which enabled Paulson to place those bets on a large scale. The ABX index, a sort of Dow Jones Average of subprime mortgage securities, facilitated benchmarking the price of credit default swaps.” In fact, it was a black box company called the Markit Group that created the ABX index. The banks were minor shareholders in Markit Group and provided data. I have noted in a previous blog that the Markit Group is a dubious outfit to say the least, and there is good reason to suspect that the direction of the ABX index was influenced by hedge fund managers and their allies at the big banks. I do not have evidence that Paulson was one of those hedge funds, but authorities ought to be asking questions. Fiderer goes on to suggest that bad loans to homeowners were a significant cause of the financial crisis. On this front, I disagree with him. Certainly, some mortgage lenders were unscrupulous, and there was a certain amount of predatory lending, but the conventional wisdom that this is what crashed the economy is simply false. At the time that the mortgage securities markets began to go south in 2007, defaults on subprime loans had increased only slightly month-to-month, and were in fact considerably lower than in earlier years. In the second quarter of 2007, for example, only 7.7 percent of subprime loans were 30 days past due, slightly up from 6.76 percent in the second quarter of 2006, but considerably lower than the 9.9 percent in the second quarter of 2001. The problem l(ay) not in the loans themselves, but in the fact that the loans had been packaged (apparently, to a large extent, at the behest of John Paulson and perhaps other bearish billionaires) into fraudulent securities that were traded and probably manipulated by a select number of hedge funds and large banks. In a somewhat similar scheme, hedge funds often pump up the stock of public companies before initiating short selling attacks aimed at demolishing those same companies. The economy was brought to its knees by a few powerful and eminently dirty players on Wall Street, not by poor people who had the temerity to buy themselves houses.

_ _ _ _ _ _ _ _ _ _ Gretchen Morgenson also documented these deals put together by Goldman Sachs, Deutche Bank and Morgan Stanley in 2009 (in the pages of the New York Times) - but no one was paying much attention then as the Gold Men took over the U.S. Government to "fix" it.

Banks Bundled Bad Debt, Bet Against It and Won

In late October 2007, as the financial markets were starting to come unglued, a Goldman Sachs trader, Jonathan M. Egol, received very good news. At 37, he was named a managing director at the firm. Mr. Egol, a Princeton graduate, had risen to prominence inside the bank by creating mortgage-related securities, named Abacus, that were at first intended to protect Goldman from investment losses if the housing market collapsed. As the market soured, Goldman created even more of these securities, enabling it to pocket huge profits. Goldman’s own clients who bought them, however, were less fortunate. Pension funds and insurance companies lost billions of dollars on securities that they believed were solid investments, according to former Goldman employees with direct knowledge of the deals who asked not to be identified because they have confidentiality agreements with the firm.

_ _ _ _ _ _ _ _ _ _ _______________

Alan Greenspan: Feted for Failure Continually & Waking Up In Wisconsin? (Is "People Power" Finally On Guard?) "Punks" Teach U.S. About Freedom

**[Although there's no prize in this announcement I want to mention that my 15,500th hit came from Wilsonville, Oregon. Thanks for reading, friends!]**

Before I begin today's essay I want to comment on something funny . . . odd . . . even humorous (almost) about something I previously reported on that I read last night about the CIA spy who was outed for killing two Pakistanis whom he said were robbing him and, thus, deserved the death penalty. No, it's really not funny. Makes me remember back to when Leon Panetta, CIA Director, in June of 2010 (when Petraeus was brought in to take charge of the Afghanistan failure and replace McChrystal, who had been too outspoken about the reality of that war for the comfort of those on top), said there were only around 50, maybe a little more, Taliban left (and so wouldn't take but a couple of trillion dollars more in war effort). It also makes me homesick for the world I grew up in when leaders with integrity decried the unnecessary spending of taxpayer funds and the venality of the military-industrial complex (h/t President Eisenhower). (Emphasis marks added - Ed.)

Raymond Davis Had Taliban Links

-Islamabad:

American official Raymond Davis, arrested for double murder, had "close links" with Taliban and was "instrumental" in recruiting youths for it, the Pakistani media claimed today, close on the heels of reports in the US that he was a CIA agent tracking movements of terror groups like the LeT.

The "close ties" of 37-year-old Davis, arrested in Lahore on January 27 for killing two men he claimed were trying to rob him, with the Tehrik-e-Taliban Pakistan came out during investigations, 'The Express Tribune' reported quoting an unnamed senior official of Punjab Police.

"Davis was instrumental in recruiting young people from Punjab for the Taliban to fuel the bloody insurgency (in Pakistan)," the official said.The report came a day after The New York Times, citing US government officials, said that Davis "was part of a covert, CIA-led team of operatives conducting surveillance on militant groups deep inside the country."

Among the groups that Davis was keeping an eye on was the banned Lashker-e-Taiba, which carried out the 2008 Mumbai terror attacks, the New York Times said.

So, it's good to have those facts, isn't it? I'm sure this country's leaders will get right on the trail and clean up this nest of self-serving criminals who are either benefitting from the prolongation of this decades-long unwinnable conflict or just using it to hone the skills of thugs needed in other secretive nationalistic endeavors. On a subject closer to home (and one that strikes deeply in my heart every day, which is undoubtedly financially tied to the waging of so-called "unwinnable" wars), I keep being asked the following question in one form or another:

"If the job situation is still as bad as you say, Suzan, why do we hear from the MSM without pause that the Recession is OVER and everyone who wants a job has been able to get one although they are not very good jobs?" (Yes, the unemployment rate is still high and will be for a while, but it's because no one wants to really work hard for a living - and thus we still need all those foreigners here who are happy to take those jobs that are beneath us.)

My answer? Because the MSM are only pretending everything's back to normal now for the Faux Snoozers whose audience doesn't pay attention to anything else. (After all, it never was a Recession for the snooze "workers.")

So, it seems only proper to beg the question: Why are we letting them get away with this? Well, first you dumb down the education system. Then, you get rid of the good jobs. Finally, the jobs you are willing to leave in the country require the full-life attention of your work populace who have little time or energy left over every day to pursue political action against unfair treatment.

Another visage that continues to present its/his n/pasty face to the masses over and over again in the MSM (although I would swear he should be dead by now) is Alan Greenspan, who is always being asked to share his wisdom about any (and every) thing that affects our economic well being. Anywhere.

And can anyone guess what's the impetus for its continual resurfacing among the so-called educated classes? After all, he's an old failure to boot. Dean Baker knows the answers to those questions (and I think Greenspan's the lead criminal in this complicated story - although maybe David Rockefeller, et al., should also be mentioned). See what you think.

Alan Greenspan: Feted for Failure February 15, 2011

The Guardian/UK

© Guardian News and Media Limited 2011

Alan Greenspan was at the wheel, apparently asleep, when the US economy drove off a cliff. Why on earth is he still lionised? by Dean Baker The Brookings Institution stands alongside Harvard, Yale, and Princeton, among the nation's elite intellectual institutions. This is why it so striking that it chose to invite former Federal Reserve board chairman Alan Greenspan to give the keynote address at a forum on reforming the home mortgage finance system last week.

It would be difficult to imagine a more disastrous failure than Alan Greenspan.

Tens of millions of people are unemployed, under-employed, or have given up looking for work altogether, as a direct result of Greenspan's ineptitude. Millions of families are facing the lost of their homes.

More than one quarter of mortgage holders are underwater with their mortgages.

The huge baby boom cohorts saw most of their life's savings disappear when the collapse of the bubble destroyed their home equity. They are now approaching retirement with almost nothing to rely upon other than their social security.

This is the direct result of Alan Greenspan's incompetence as Fed chair.

He either did not recognise the $8 trillion housing bubble or somehow did not think it was a big deal.

This was a monumental misjudgment. The housing bubble was really hard to miss for anyone who can read a chart and knows arithmetic.

For 100 years, nationwide house prices had just tracked the overall rate of inflation. Suddenly, in the mid 90s, coinciding with the stock bubble, house prices began to substantially outpace the overall rate of inflation.

By 2002, house prices had already risen by more than 30 percentage points in excess of the overall rate of inflation. At the peak of the bubble in 2006, the inflation in house prices had exceeded the overall rate of inflation by more than 70 percentage points, creating that $8tn bubble in housing wealth.

There was no remotely plausible explanation for this, based on the fundamentals of either the demand or supply side of the housing market. Population growth and household formation were much slower during the bubble years than in prior decades. Income growth had been healthy in the late 90s, but went in reverse in the 2000s. On the supply side, the country was building homes at near record rates, so supply constraints obviously could not explain the runup in prices.

Anyone looking for an explanation would also have to explain why rents were going nowhere. The fact that the vacancy rate had already hit a record high as early as 2002 should have been another really big bright warning sign that housing was in an unsustainable bubble.

If it was impossible for competent economists to miss this assessment, it should also have been impossible for them to think it could deflate harmlessly. The bubbles in residential and non-residential construction led to enormous overbuilding in both sectors. The "wealth effect" associated with the $8 trillion transient housing bubble was generating close to $500bn in annual consumption.

This meant that the combined drop in construction and consumption demand from the collapse of the bubble was almost certain going to be in excess of $1 trillion.

Did Greenspan think he had something in his bag of tricks as Federal Reserve board chairman that would allow him to quickly replace more than $1 trillion in annual demand?

Absent some new source of demand (which has not appeared), it was inevitable that the collapse of the bubble would lead to a prolonged period of high unemployment.

This was all 100% predictable; but Greenspan did not predict it – because he was not doing his job.

Incredibly, in spite of this disastrous performance as Fed chairman, Alan Greenspan is still being feted in elite circles. Perhaps this is due to the fact that the people who sit in these elite circles openly celebrated Greenspan as he drove the economy off a cliff.

He was declared the "Maestro" by one of the country's top reporters. At the annual meeting of central bankers in Jackson Hole, Wyoming, the leading lights of the economics profession debated whether he was the greatest central banker of all time, as he prepared to leave his post.

In other words, Greenspan may have ruined the lives of tens of millions of people and cost the lives of tens of thousands (yes, people die because of inept economic policy: they kill themselves, they don't get healthcare that they need, and they die from alcoholism and despair), but he does not bear the blame alone.

Most of the people who hold top positions in policy and academic circles share blame for disaster – refusing to do the simple analysis that would have allowed them to see this disaster coming.

The pain and suffering caused by Alan Greenspan's incompetence vastly exceeds the harm that our worst enemies could even dream of inflicting on the United States. Yet, apparently, he can always count on a position of honour at the Brookings Institution.

Heckuva job, Alan!

(Dean Baker is the co-director of the Center for Economic and Policy Research (CEPR). He is the author of The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer ( www.conservativenannystate.org) and the more recently published Plunder and Blunder: The Rise and Fall of The Bubble Economy. He also has a blog, "Beat the Press," where he discusses the media's coverage of economic issues. more Dean Baker

My buddy Tom over at Who Hijacked Our Country has a few words for us on the current Wisconsin Surprise.

Wisconsin Wails? Is the Country Waking Up Finally? When these pro-middle class demonstrations started in Madison WI last week, who would’ve guessed they’d have even more momentum a week later? For a country with such a microscopic attention span, this is phenomenal.

Try as they might, the Kochtopus and its useful idiots haven’t been able to brainwash the public. At least not yet. According to the newest Gallup/USA Today poll, 61% of Americans oppose the idea of wiping out the collective bargaining rights of state employees.

Wisconsin’s Governor Mubarak Walker hasn’t budged, but two other Republican governors have backed off from their own plans to squelch unions: Florida Governor Rick Scott and Governor Mitch Daniels of Indiana.

These protests have made Madison look like it’s the 1960s and the Vietnam War is still raging. And to help bring together the ‘60s and the present, members of Rage Against The Machine and the MC5 performed a free concert.

Country Joe, where are you?

And now, equal time for the Oligarchy:Koch Industries/Tim Phillips/Americans For Prosperity have unleashed a new commercial to get the inbreds all fired up. The video is no longer available at the linked article. Darn it.

And you’ll love the latest shitspew from Rick Santorum:“They are acting like their drug is being taken away from them . . . . What these folks are in Washington is no better than a drug dealer. They give you a subtle narcotic to make you feel better as you do worse.”

Gee, I wonder why he got defeated four years ago.

David Michael Green is not at all forgiving of ignorants and fools. Yeah, as if anyone is who is paying attention (emphasis marks and some editing inserted - Ed.).

Insignificant, backwater, third world banana republics like Tunisia and Egypt pioneering the way for the greatest superpower and richest country on the planet.

That’s not supposed to happen.

I mean, we pay for a military that costs as much as every other one in the world, combined, even though it can’t win endless wars against insignificant, backwater, third world banana republics. They can’t say that about their militaries! We’ve got annual deficits that are bigger than their entire economies.

The size of our economy is half-again bigger than the number two in the world (with one-fourth the population), and we’ve managed to produce a health care system that ranks 39th globally.

Who else can claim that badge of honor?

No doubt that ranking partially explains why our life expectancy figures are lower than just about every country in the developed world.

Our education system, once the envy of the world, is crumbling, along with the size of our college enrollments.

Ditto our infrastructure, much of which hasn’t been maintained in decades.

Who can touch that?

We have the highest polarization of wealth in the entire developed world, and more than any country in the Arab world too. Sweet!

Another cool thing is our incarceration rate. It’s 743 per hundred thousand people. The next highest country has less than half that figure. Our use of torture and rendition and the remote-controlled aerial bombings of civilians has earned us the scorn and hatred of the world, while our political leaders, unmatched in their capacity for hypocrisy and buffoonery, have made us a laughingstock that few puffy-chested, medal-covered third world dictators can match. You got Mugabe? We got Palin. You got Charles Taylor? We got George W. Bush, in a democracy no less.

So, with a record like that, who in the world are these punky backwater countries to teach high and mighty America anything about anything?!?!

Darned if it hasn’t happened, though. I mean, you can say it’s a coincidence if you want, and you may even be right. But I can’t help thinking that the people of Wisconsin have been inspired by the people of Egypt. Who were themselves inspired by the people of Tunisia. Both of whom have inspired the people of Bahrain, Jordan, Iran, Libya, Yemen, Iraq and beyond.

Meanwhile, Wisconsin seems to be inspiring Americans in other states finally to fight back.

It would seem that people power is in the air in early 2011, and that it’s quite contagious.

Whatever is the explanation for the Cheesehead version of Tahrir Square, it is unbelievably welcome, and just barely in time.

It’s crucial to understand what the regressive initiative that our brothers and sisters in Wisconsin are right now fighting is really all about, and how that fits into the context of our era. This is just the latest, and nearly the last, in a succession of efforts in America over the last three decades to move money from the hands of non-elites to those of oligarchs.

Make no mistake, that program constitutes essentially the sum total of American politics at its core over the last generation. All else is a sideshow or, more likely and more ominously, an intentional diversion, just as a skilled magician is careful to give your eye something else to focus on as he moves the ball from under the cup.

That money-shifting effort has been relentless, and it has been fantastically successful. We have witnessed the greatest transfer of wealth in human history over this period of time.

More astonishing, here in the twentieth and twenty-first centuries, is that it went the wrong way – from ordinary folk who need the money to wealthy elites, many of whom actually couldn’t even find ways to spend those enormous quantities flooding their accounts if they wanted to.

Most astonishing of all is that this happened in a functioning democracy, where the votes of rip-offees vastly outnumber the votes of rip-offers. If anyone you meet ever doubts the capacity of human stupidity, tell them this tale. It’s an amazing story. It’s also the most significant single fact of American politics in our time. And we don’t even talk about it.

That’s because of the stunning success of the thieves in executing their heist. As oft-noted, the perfect crime is one that is not even detected. Welcome to America.

You gotta hand it to these guys. They have been smart, thorough, ruthless, tenacious, patient and ruthless. Did I mention ruthless? They have attacked New Deal America – the set of policies that created a vast middle class for the first time and dramatically improved people’s quality of life en masse – in every way possible, and have managed to beat it into near submission.

They’ve been very clever about it, too. They fabricated think tanks whose product at any other time would have seemed absurdly laughable. They created a whole new media for themselves, and intimidated the parts they didn’t outright own.

They dumbed down education, making sure that any knowledge of history or civics or – god forbid – comparative politics was eliminated from the curriculum, thus producing nice, docile worker bees who know just enough to do their ill-paid jobs, but not enough to even know that they’re ill-paid.

They allied with regressive forces like religious institutions, the military and the Republican Party. Then they bought the Democrats too, not least of which including Bill Clinton and Barack Obama, whose economic policies are fundamentally indistinguishable from the GOP’s.

They infiltrated the courts with corporate hacks so corrupt that they steal elections and sit on cases even when they’ve received contributions from litigants in the matter.

They smashed labor unions at every opportunity. They drove the country deep into debt with the express purpose of making it then seem that any further social spending was no longer sustainable.

They tore down even the thin veneer of campaign finance reform from the prior era. They shredded the Constitution and the Bill of Rights, and have bullied any opponents with thuggish acts of verbal and other forms of personal assault.

They made voting more difficult, wrongly purged masses of voters from the rolls, and used rigged machines to steal elections. They have poisoned the minds of Americans with diversionary bogeymen ranging from Saddam Hussein to marrying gays to the War on Christmas.

Come on David (I adore this guy), tell us how you really feel.

Cause I'm there, brother. _________________