Monday, December 26, 2011

10 Dumbest Moves of 2011

Year-end lists are a longstanding tradition, so who am I to struggle against them? The following is my contribution, a list of the stupidest things done by persons and institutions over the past year. As is customary, they are listed in reverse order of stupidity:

10! Bank of America announces debit card fees

Really, they should have known better. Clearly, people were going to notice. One assumes they now have found other, less in-your-face ways to gouge the same revenues from depositors.

9! Wisconsin governor Scott Walker attacks public sector unions

I guess he though he'd get away with it and become a Republican icon with a clear path to the White House – but it kind of backfired. Unwittingly, he managed to revitalize the labor movement and become the target of a recall campaign.

8! Dominique Strauss-Kahn gets blow job

It may have been the most expensive blow job in history, surpassing the Bill Clinton blow job of 1998. Clinton kept the presidency, but DSK never will be Premier of France.

7! The Supercommittee


6! Democrats buying into the "deficit problem"

The biggest concern of the largest number of Americans is unemployment. Even the people with jobs seem to understand that high unemployment rates are depressing their wages, but, as usual, Democrats let Republicans define the parameters of the debate — and, as usual, wound up on the defensive. Given that the Treasury currently is borrowing at less than 2%, nobody who matters is too worried about US solvency.

5! Republicans having all those debates

The more the Republican primary candidates debate, the more obvious it becomes that they're all genuinely defective. The most victimized victim was Rick Perry. Hell, he has great hair, rugged good looks, solid conservative credentials, and cowboy masculinity. Difficulties arose, however, when his handlers let him open his mouth, thereby demonstrating just what an ass he is. (Nevertheless, the debates have been the most entertaining "reality television" I've ever seen.)

4! Ongoing US support for al-Maliki in Iraq

It's been clear for years that Nuri Kamal al-Maliki is a corrupt, self-aggrandizing piece of shit, and about ten minutes after our long overdue withdrawal from Iraq, he showed us just how stupid we were to put any trust in him whatsoever. Sorry, Barack. There goes democratic Afghanistan.

3! European austerity programs

So, where's the growth supposed to come from? Just because the eternally anal-retentive, moralistic Germans have all the money doesn't mean the rest of Europe should buckle under to their demands. Outside the Eurozone, I'm thinking David Cameron, too, might be in trouble.

2! Egyptians putting trust in their military

Damn, it's rough when, after your revolution, you have to do it again. Maybe there should be a handbook telling people how to tell the difference between a revolution and a military coup.

1! Obama attempting to compromise with Republicans

Dammit, he's not that stupid! Well, maybe he is. Maybe he thought his neo-liberal stances would somehow endear him to his sworn enemies. (That kind of thinking would have been very stupid indeed.) More likely, he thought his Wall Street friends would come to his rescue. Well, they didn't. Wall Street execs still value short term outcomes over long term outcomes, because the short term still is where their bonuses are generated.

So there you are, and a happy New Year (uh-huh!) to all.

Friday, December 23, 2011

As 2011 draws to a close...

It's nice to see Republicans attacking Republicans for a change — including, of course, the attack ads against Gingrich in Iowa, but especially the Establishment Republicans slapping around the Tea Party maniacs to stop them from blocking an extension of the Payroll Tax holiday. Could it be the GOP (with an especially fond wave to Dick Armey) created Frankenstein's monster leading up to the previous election cycle? Probably not. Not only are most American voters not paying attention, but most didn't even know what the controversy was about.

Okay — if they'd seen their take-home pay go down as of their first paychecks in January, they might have figured out what was happening, and perhaps even who was at fault. Now that the crisis is averted (or at least delayed for two months), there will be spin — and individual perceptions will depend on individual choice of news outlets.

And, yes, I'm one of those arrogant asses the average American loves to hate. Needless to say, so is Newt — and his "all positive campaign" is meant to suppress memories of just what an arrogant ass he's been in the past. Honestly, though, I can't imagine him winning the nomination. People don't change that much as they age, and he's overdue for a self-destructive detonation.


Meanwhile, Iraq, Pakistan, Syria, Afghanistan, Egypt, and other so-called countries are strenuously enacting these famous lines from Yeats (1919):

Things fall apart; the centre cannot hold;
Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed, and everywhere
The ceremony of innocence is drowned;
The best lack all conviction, while the worst
Are full of passionate intensity.

No, I don't think "the Second Coming is at hand." Just the same old shit. Happy holidays.

Sunday, December 18, 2011

Leaving Iraq

Okay, the United States has officially withdrawn the last of its armed forces from Iraq as of today — but what have we left behind? Is Iraq in any better shape now than it was in 2005, when we might have pegged a troop withdrawal to the election of the Iraqi parliament? I don't think so.

US troops had been there roughly half a year when it was concluded that the "weapons of mass destruction" the Bush administration offered as a justification for invasion did not exist. After another couple of months, Saddam Hussein was captured and turned over to the Iraqis. We could have been gone by a year later, when they (very picturesquely) hanged him. They really didn't need us for that.

Today, Iraq continues to be splintered along religious and ethnic lines. Nuri Kamal al-Maliki shows little regard for the rule of law, the Iraqiya coalition of secular and Sunni Iraqis is boycotting the parliament in protest, and militias loyal to individuals like Muqtada al-Sadr have not been disarmed nor disbanded. No agreement has been reached with the Kurds about sharing oil revenues, and the Kurds seem willing to fight to maintain their autonomy. The forces of our allies in the "Sunni Awakening" are complaining of persecution by the majority Shi'a government. Iran's influence is extensive, and growing.

When the US leaves Afghanistan — at some unspecified date in the future — that country is likely to be even more disordered, corrupt, and crazy than Iraq is today. So, why wait? Let's bring all the troops home.

Friday, December 9, 2011

SB 1867

It's been easy to miss, but this year's Defense Appropriations Bill includes some language that has civil libertarians in an uproar. See if you can figure out what's wrong with this section:

(1) IN GENERAL.—Except as provided in paragraph (4), the Armed Forces of the United States shall hold a person described in paragraph (2) who is captured in the course of hostilities authorized by the Authorization for Use of Military Force (Public Law 107–40) in military custody pending disposition under the law of war.
(2) COVERED PERSONS.—The requirement in paragraph (1) shall apply to any person whose detention is authorized under section 1031 who is determined
(A) to be a member of, or part of, al-Qaeda or an associated force that acts in coordination with or pursuant to the direction of al-Qaeda; and
(B) to have participated in the course of planning or carrying out an attack or attempted attack against the United States or its coalition partners.

So far, it seems almost reasonable — military detention for terrorists, right? There are a couple of little problems, though. First, there is no burden of proof involved. An accusation is enough to justify detention indefinitely, with no right to anything resembling a trial. More importantly, perhaps, it authorizes the military to exercise police powers within the borders of the United States, thereby overturning the Posse Comitatus Act of 1878 — but stay tuned for the real kicker:

(1) UNITED STATES CITIZENS.—The requirement to detain a person in military custody under this section does not extend to citizens of the United States.

On first reading, you might think US citizens are exempt but, as the ACLU has pointed out, the fact that there is no requirement that the military detain citizens without trial (or even a grand jury hearing) does not mean that the military cannot choose to do so — nor that the President cannot order the military to do so. Remember, all that is necessary is an accusation — no actual evidence is required.

Currently, the bill is in the hands of a Conference Committee to reconcile House and Senate versions, but there is no reason to believe that committee will do anything to ease civil liberties concerns. An attempt to amend the Senate bill to change the language failed. Our President has threatened a veto — not because he doesn't think he ought to have the powers of a military dictator, but because he sees other sections of the law as an attempt by Congress to micromanage the so-called "war on terror." Violations of roughly half the Bill of Rights don't seem to bother him.

George W. Bush began the campaign to suspend the right of Habeus Corpus. Barack Obama has continued it. Somehow, I can't see Mitt Romney or Newt Gingrich sacrificing any executive powers if one of them becomes our next Commander in Chief.

Monday, December 5, 2011

Occupy CUNY

I'll start with a complaint. Why am I making contributions to an alumni association that did not inform me of the November 21st "Occupy CUNY" march on Wall Street? I'd have been there, and so would a lot of other long-ago graduates who went to CUNY... those of us who went for FREE.

We geezers who attended the schools of the City University of New York before 1976 paid no tuition. Why, I have to wonder, was New York City able to do it then, but not now?

Well, the city has lost a hell of a lot of state aid over the years — but where did that money go? I'm still not sure. Also, I'm not sure where the federal money went, specifically, except that the later seventies were the time that tax rates on the rich began their precipitous fall.

College should be free. It's hard enough to make it out of the working class — and if you have to put yourself in ridiculously crazy debt you can't even shed in bankruptcy court to get a little bit beyond where your parents were, it may never happen. (Are there any corporate debts that can't be shed in bankruptcy? I can't think of any.)

Back in the sixties, I'm sure I could have qualified for some financial aid, and probably won a scholarship or two, but I doubt it would have been enough to get me all the way through a private college. It's certainly not enough for many students today, especially since jobs for those without college degrees are in such short supply and pay so poorly (and since full-time work and full-time school really are incompatible.)

The Occupy movement is about economic inequality — but also points out how generally screwed up our priorities have been for the past few decades. It's really time to get them straightened out.

Saturday, December 3, 2011

The Demise of Herman Cain

Sex scandals? Jesus Christ!! Newt surges ahead, with not much attention paid to the fact that Newt was banging a Congressional aide while he was leading the thrust (pun intended) to impeach Clinton for getting head from a Presidential aide.

For all I know, Cain is not guilty of the accusations against him. Well, what do I know? It all could be a plot hatched by Mitt Romney, who may have had his own kids by immaculate conception. Okay. Cain has been a CEO, a lobbyist, a politician, and probably part of many other categories of lying scumbags with more testosterone than is good for the world order. Sorry, though, but when a guy (any guy) is trying to be President of the United States, you can't believe a word anybody else says about him (or a word he says.)

Here we are, in the world of unimpeachable lies — lies that are unimpeachable because scarcely anybody is paying attention.

Pay attention, damn it!

Thursday, December 1, 2011


I tore this paragraph out of today's Times.

Just how stupid are we supposed to be? Mind you, it's not just the asshole Republicans, but also the asshole Democrats. Did they think we wouldn't get it?

I am acquainted with some people whose ideology dispenses them to agree with every idiotic thing they hear on Fox News, even though they're not idiots. I'm also acquainted with some idiots, but even they are not that stupid. All of us should be offended right now. According to recent polling, 91% of us are offended. The rest, for inexplicable reasons, approve of the job being done by our Congress.

* * *

There's a promo on Comedy Central where Carlos Mencia says, "Barack Obama looks like Curious Fucking George! There! I said it!"

We really need humor these days — but, preferably, not from Congress.

Monday, November 28, 2011

Saving the Euro

Greece and Italy have been handed over to technocrats, tasked with taking the difficult steps that politicians find impossible. Democracy, clearly, is incompatible with austerity. Make people suffer (most often for the sins of economic elites,) and they vote you out of office. It's as simple as that.

In Spain, the Socialists have been replaced by the center-right Partido Popular — not because Spaniards have suddenly become more conservative, mind you, but because the Socialists were presiding over the austerities forced on Spain by other Eurozone countries (mostly Germany.) Since the Popular Party will be obliged to continue the same unpopular policies the Socialists began, we can expect it to get a lot less popular in short order. Watch out, amigos, here comes another technocrat.

As for mes amis en France, your turn will come as well. Sarkozy is not long for power, and nobody in French politics will want to take responsibility for austerity measures. Yet another European technocracy would not be a surprise.

The source of all the unpopular austerity is Germany. The eternally anal-retentive Germans just can't stand it that their neighbors to the south were inclined to spend more than they earned. Their disapproval goes beyond the economic: it is moral disapproval. Since the southerners were so profligate and generally naughty, Germans feel, they don't deserve to be bailed out. Most Germans probably believe they ought to be birched on their bottoms.

As I see it, the most straightforward way to save the Euro is for Germany to drop out and return to the deutschmark. Maybe they can form a monetary union with the Netherlands, Europe's other economically responsible country. After that, the rest of the Eurozone can inflate its way out of debt.

Word is that there are some financial whiz kids in Germany quietly thinking through this solution. It's extreme, but if the German ants won't save their grasshopper neighbors, it may be the only remaining possibility.

Monday, November 21, 2011

So Much for the Supers

Well, what did you expect? Of course they deadlocked, and as Paul Krugman pointed out in his column in Friday's Times, it's the best outcome we could have had. Anything short of a deadlock would have been a Democratic cave-in, since the Republicans are totally committed to protecting their plutocratic masters from any slight discomfort or inconvenience.

As we all know, in our current government, it's the President's job to cave. Okay, maybe that was a bit cruel. Honestly, I think Obama really believes a lot of that neoliberal bullshit the "New Democrats" have been spouting for twenty years now. Coming out of the Ivies and then teaching at the University of Chicago, he would have been marinated in it for most of his intellectual life.

I think those "automatic cuts" that are supposed to be triggered in 2013 have about as much chance for survival as a Democratic candidate in Utah, even though $1.2 trillion over ten years is not a hell of a lot of money. Congress will have over a year to backtrack, and find ways to rescue its unquestioned overlords, the defense contractors.

If Obama genuinely wants to make a difference with regard to deficit reduction, he has to veto the inevitable effort Congress will make to extend the Bush tax cuts. Since he's unlikely to get a bill that only raises taxes on the rich, he has to be brave enough to let them all expire. What's left of the middle class will manage with a little less money in their pockets.

What frightens me most is talk about "streamlining" the tax system — reducing the number of tax categories and eliminating most deductions. When it was done under Reagan in the eighties, it started the decline in taxation of the rich — and in the years since, just about all the corporate tax breaks that were eliminated at the time have been written back into the code, and then some.

We should not be worrying about deficit reduction now, in any event. Even with the so-called "downgrade" of US debt by S&P, we don't have any trouble borrowing at ridiculously low rates. We should be taking advantage of those ridiculously low rates to borrow the money we need to put people back to work. The best way to balance the budget is to expand the number of people earning good salaries and paying taxes.

Thursday, November 17, 2011

Egypt, again

As embarrassed as I may be (not much) by saying "I told you so," well, I told you so. Here was my prediction for the Egyptian revolution. Fuck it. I told you so.

Yes, the Egyptian military has no desire to give up the power it has exercised since Nasser replaced Farouk. Would you? Hell, they have all the money and all the power. Who the fuck needs democracy when you have the army?


Not entirely related, I heard on the BBC today that the number of Israeli settler attacks on West Bank Palestinians has tripled over the past two years. The UN official in the area — some guy from India — says the settlers are largely responsible. Okay, the Palestinians are far from perfect — but the Israeli settlers seem to be total pieces of shit. Why burn a guy's olive trees, trees that his great-grandfather planted?

(Answer: if he's still around when and if a Palestinian state comes into being, he actually may get to keep his land.)


As you may have noticed, I do my best to stay away from mideastern bullshit, as best I can. My avoidance, however, does nothing to stop the carnage.


Wednesday, November 9, 2011

Sexual Sidebars

According to yesterday's Times (and today's Times as well), the Pope of Pennsylvania (aka Penn State football coach Joe Paterno) is being pushed out of the job he's held for forty-six years for the little matter of neglecting to take appropriate action when given some lurid details of what assistant coach Jerry Sandusky was doing with that little boy in the Penn State shower room. Somewhat like the Pope in Rome, Paterno has been viewed as pretty much infallible by football fans. Even more like the Pope in Rome, Paterno was willing to let the sexual peccadillos of his underling go unreported to civil authorities, and probably for the same reason — money.

Like the Catholic Church, the Penn State football program depends on private contributions — and Penn State itself gathers about five percent of its revenues and most of its notoriety from its football team. Would the alumni be as inclined to contribute to a school that harbored kiddy diddlers? Would the faithful continue to top off the collection plates of a Church that harbored kiddy diddlers? Who knows? Better not to take the chance. Shove it under the rug, by all means.

* * *
Speaking of money, Silvio Burlusconi's adventures with underage prostitutes never did him a bit of harm, but threatening to bring down the Eurozone is another matter entirely.


Then there's that little matter of Herman Cain and the sexual harassment: since I am not of the female persuasion, I'm not entirely sure just what makes a woman "uncomfortable," but what Sharon Bialek describes certainly would make me "uncomfortable." I can't see any way to confirm the Bialek accusations, and I have no doubt that a lobbying group like the American Restaurant Association would pay off any woman (like Karen Kraushaar) ready to file a complaint, whatever the circumstances that provoked it. Well, so what?

Herman currently is blaming the "Democratic Machine" (would that it existed outside of Chicago) for his publicity problems, but his previous preferred hitman, Rick Perry, still seems a more likely choice. Perry has been wasting a hell of a lot of money garnering his 7 or 8 percent, and you just know he wants that nigra out of the competition. Obama, on the other hand, knows he can out-white Cain (because he is very nearly as white as Ivory soap.) Against Cain he can pull in the liberals, half the blacks, and the racists — and win the general election.

As for Mitt, he can't have any problem with Cain and Perry banging away at each other. His foremost problem is America, which sometimes can suss out assholes. I sincerely wish there were going to be a candidate who might win my enthusiastic vote, but I'm not counting on it — and it's certain that she (or he) never could win.

Thursday, November 3, 2011

Another reason to dump Geithner

It made the front page of the business section of yesterday's Times, but the broadcast media haven't had much to say about it: it seems that back when Timmy Geithner still was president of the New York Fed, he and his crew had a real opportunity to get the banks that bought credit default swaps from AIG to take a haircut. Some, according to the Binyamin Appelbaum, were ready to do so voluntarily. Nevertheless, Timmy ("Wall Street's Pocket Puppy") Geithner determined that American taxpayers would make good 100% of Wall Street's potential losses.

If you've been around this blog for a while, you may remember how I was especially pissed off by the AIG bailout — here, for example, and here, and here. Well, I certainly am no happier now than I was back then — in point of fact, "pissed" no longer is an adequate description of my feelings of revulsion. Now that the GAO has reported that Geithner, apparently, felt greater obligations to the banks than to the human beings rescuing them from their paroxysms of greed, I am angrier than ever — both at Geithner, and at Barack (Robert Rubin's Pocket Puppy) Obama for appointing him to Treasury.

If Obama wants to align himself with the populist perspective, and portray the Republicans (accurately) as pawns of big finance, he'd better stop being a pawn of big finance himself. Dumping Geithner would be a very good start.

Tuesday, November 1, 2011

Well, here's to democracy... I guess

Nominal socialist George Papandreou is referring the current Greek bailout deal to the Greek public in a referendum. The pundits seem to think he is "tossing the dice," hoping the Greek public will back his negotiated deal, and thereby shutting up the voices of opposition. That interpretation seems unlikely to me.

Could it be that Papandreou remembered that he is, at least nominally, a socialist? I sincerely hope so. I hope he returned from the negotiations asking himself, "What have I done?" From a political perspective, he might very well be asking himself how the Socialists let the Greek center-right seize the issue. Don't political labels mean anything?

(These days, probably not. Hell — Obama is accused of being a liberal.)

I would like to think that Papandreou's decision to put the bailout plan to the Greek people arises from pangs of socialist conscience. Most Greeks seem to understand that while austerity may be good for European banks, it is not necessarily good for Greece. Whatever chaos an "uncontrolled" default might cause around world financial markets, for the Greeks, following in the footsteps of Argentina seems like the best bet to me. I've already posted my unsolicited advice.

I just hope the rest of us survive it.

Friday, October 28, 2011

The Latest Eurodebt "Solution"

If there's anything the latest news out of Europe shows us, it's that markets bounce around like crazy on any news at all — even news that doesn't mean very much. Of course, the market professionals (and especially their computer algorithms) like volatility. Anyway, let's take a quick look at what's been announced.

First, even after their bondholders take their "voluntary" 50% haircut, the Greeks still can't afford to pay. All the extreme austerity measures the Greek government has been forced to accept have so crippled the Greek economy that the likelihood of Greece paying anything at all is very small.

Second, European banks have been required to increase their capital reserves. Granted, their capital reserves should be a lot larger — but rather than dilute their stock too far by selling shares to raise cash, they can be expected to cut back lending even more, stepping down even harder on Europe's economic brakes.

As for beefing up the European rescue fund enough to "ring-fence" Italy and Spain (and hopefully not France), the "plan" would inspire a lot more confidence if there were a real plan. Hoping the Chinese and Russians will come to the rescue is not a "plan."

I can't wait for next month's "solution."

Wednesday, October 26, 2011


So, just who is the president of Ubeki-beki-beki-beki-stan-stan, the guy Herman Cain never heard of? Cain, you will recall, recently said:
"When they ask me who is the president of Ubeki-beki-beki-beki-stan-stan I'm going to say, 'You know, I don't know. Do you know?' ... Knowing who is the head of some of these small insignificant states around the world I don't think that is something that is critical to focusing on national security and getting this economy going."
Assuming he was making an ignorant and probably racist comment about Uzbekistan, the former Soviet republic, I have some news for him. The president of Uzbekistan is Islam Karimov, and he is a really bad guy. He runs the most repressive regime in the region, will not tolerate dissent, and is accused of many human rights abuses.

By the way, he's also an ally of the United States in our "war on terrorism," and has the wholehearted support of Vladimir Putin as well. Hey, Herman! You do know who Vladimir Putin is, don't you?

We shouldn't be surprised by Rush Limbaugh'ss praise of the Lord's Resistance Army for being "Christians... fighting Muslims," while ignoring the fact that the LRA is the most brutal terrorist paramilitary cult in central Africa. We all know that Rush is an asshole.

Cain, however, is running for President of the United States. Unlike Rush, he should not have the opportunity to revel in his ignorance.

Wednesday, October 19, 2011


Herman Cain has been shooting himself in both feet from quite a few different angles lately, but now that some major media have started paying attention to what econometricians make of his 999 plan, we should not have to wait too long for the shot to his head. Although all of 999 is a shameless giveaway to the rich, the real "killer" is the national sales tax.

Even innumerate Americans can understand that a 9.1% federal sales tax on every gallon of milk, every pair of new shoes, every gallon of gas, and everything else except for "used" items (used milk?) will cost them a hell of a lot of money. Ordinary Americans, who spend most (or all) of their incomes would be hit the hardest. Even those willing to ignore how a 9% income tax would devastate the working poor will come to view that sales tax with horror.

The rich, of course, whose incomes far exceed whatever they conceivably could spend, would pay an even smaller proportion of their incomes in taxes than they do now. I'm far too lazy to do the math and construct a chart showing the impact of "999" on people in different income brackets, but I assume somebody will do it fairly soon — probably some anonymous somebody from the Romney campaign. (It won't be the Obamanistas, who will be happy to see Republican infighting go on for as long as possible.)

In the meanwhile, most of the Wall Street money is going to Romney — and as far as politics is concerned, Wall Street money is the smart money. Needless to say, though, the financiers are hedging their bets by contributing to Obama as well. Then again, once there's a clear leader — of whatever party — they'll flood him with money. They always like the winner to think he couldn't have won without them. (It sure worked with Obama!)

* * *

Following up on my previous post: recent polling shows that a majority of Americans are sympathetic to the "goals" of the Occupy Wall Street movement — which shows that you really don't need specific policy goals to win public support. Most Americans don't have specific policy goals. They just get it.

Friday, October 14, 2011

The Occupation

I don't believe the media really does not understand what it is the "Occupy Wall Street" crowd and their cousins around the country are demanding. Maybe news types are so accustomed to "specific" recommendations like Perry's call to drill for oil and gas in National Wildlife Refuges or Cain's idea for an immensely regressive national sales tax (more on that in a later post) that a simple idea like "Stop the goddamned plutocratic parasites from sucking our blood" is beyond their comprehension.

No, it's not beyond their comprehension. They just don't like to think about such a scary idea because the media are owned and controlled by goddamned plutocratic parasites. So who is left to explain the Occupation's simple, straightforward message to the long-deluded segment of the 99% who haven't quite caught on?

Simple. Those of us who do understand have to make every effort to explain, face to face, to those who don't. Most people catch on immediately, even those who never heard the word "plutocrat" before. Do not leave the task to organizations like, which are working hard to co-opt a populist movement on behalf of Obama and the Democrats. The Democrats — especially since Clinton — have done just as much to advance the parasitic/plutocratic agenda as the Republicans.

Screw the Democrats. It's time for us to do it ourselves.

Friday, October 7, 2011

Απονομή, η ελληνική κυβέρνηση!

(That is supposed to say, "Hey, Greek government!" but I must admit it's Greek to me.)

Anyway, I thought you guys were supposed to be Socialists — so what's with the sucking up to the ECB, the private banks, and the IMF? Those are your people in the streets. Don't fuck them over.

There's an odd chance your rocky, sunwashed little country could bring down multinational capitalism by tipping over banks like a row of dominos. That would present a big problem for the rest of the world, but in Greece you'd hardly notice the difference. Everybody knows you're going to default, so why keep torturing the Greek people when you could start helping them now.

First, of course, you have to leave the Eurozone. Yes, we all know there never was an orderly way provided for a country to do that, so you'll have to improvise: start printing drachmas, and use them to pay your very numerous government employees. Pick any conversion rate to the Euro you like. Close your banks long enough to replace all their euros with drachmas. Pretty soon, what's left of your private sector will be paying its employees with drachmas too, because they'll be a lot cheaper than Euros; and those who sell goods and services will have to accept them because they'll be the only currency around. The idea, of course, is to end up with a devalued currency. The tourists will love it.

There will be, of course, a black market in currency — which will help to devalue the drachma even more. Inside Greece, though, prices will adjust to the new (old) money. Imports will be very expensive. Local producers will sell more of whatever they produce. Maybe you can find something other than tourism to sell abroad.

Gather together all the euros you can get your hands on — it doesn't matter how many. Set some aside so you'll have a little foreign reserve for when you really need imports, and explain to your creditors that all they'll be getting is what you have left to give them. Their haircut might take some scalp along, but you can just shrug in that charming Greek way you have, and go about your business.

Granted, nobody will give you credit for quite a few years but, at last, you'll learn to live within your means — and don't worry about the Germans invading again. They can't get blood from a stone.

Saturday, October 1, 2011

The "Robin Hood" Tax

There has not been very much discussion of the European Commission's proposed "Robin Hood" tax on financial transactions on this side of the Atlantic, probably because it is seen as a dead issue here. Both Democrats and Republicans are far too deep in the pockets of big finance to even give the idea a hearing. Nevertheless, it deserves some attention, especially if it can be tweaked a little to address a problem we've seen a lot of lately: excessive volatility in the markets.

The heart of the European plan is a .01% tax on all financial transactions, including stocks, bonds, derivatives, and other financial instruments. Although only one one-hundreth of a percent, it is estimated that the tax would raise €210 billion annually to support the European Union.

So what's the tweak I'd suggest for the USofA? Simple. Do not tax the sale of an asset if it has been held for more than one month. Tax it at .005% if it has been held for at least one day, and tax it at .015% if it has been held for any shorter period of time. This would put the greatest burden on program (aka "high frequency") traders, who may make as many as 10,000 trades per minute, and would reward longer-term investments. Long-term investment — the kind used to finance real economic growth — is the kind of investment the United States needs right now.

I have no idea how much money this plan might generate, but I know for certain that it would royally piss off the big investment bankers, hedge fund managers, and anybody else bailed out by the taxpayers in 2008. Most Americans would get a good deal of satisfaction from that outcome alone, but, more important, getting big finance to repay taxpayers for their 2008 largesse also would be a form of justice.

Hey, Obama! Looking for another populist ploy for your 2012 re-election bid? Try it.

Thursday, September 29, 2011


It's been said many times that democracies are unable to deal with economic crises, but I don't mind saying it again. Voters always respond to promises of free lunch, despite having been told, over and over again, that there is none.

Keynesian economics really ought to work — and would, were it not for democracy. Stimulus really is necessary to pull an economy out of a recession, but the other side of Keynesianism never happens: when economies are booming, responsible governments should raise taxes and cut spending, building reserves to use during the inevitable downturns. Democracy makes that impossible. When there's extra money flowing in, pandering politicians delight in giving it away.

By comparison with most of Europe — especially the south — the USofA doesn't look all that bad. Greece, of course, is a total basket case. Word is out that bondholders will have to take a 50% haircut, although I'm inclined to think 50% won't be enough, and we should brace for the crash and burn. The Germans have approved about $600 billion in bailout funds, but most economists think that's not nearly enough. It's more than enough for the German voters, however, who don't want their tax money going to bail out those feckless, swarthy southerners.

One of the biggest problems central banks around the world have to deal with, as usual, is lack of transparency. Nobody is clear on how much exposure banks around the world are carrying — not only for Greek debt, but for sovereign debt from other shaky countries as well. Banks have been allowed too much power to hide their holdings, worldwide.

For Europe, moreover, getting a fiscal solution to the financial crisis is even harder than it is in the United States. If the Eurozone is going to survive, it needs fiscal as well as monetary union — and the usual democratic political restraints make that look next to impossible. The ECB, if it gets up the nerve, may just have to inflate Europe out of its dilemma. Bankers and bondholders, of course, will hate that — but the only way I can see for all that sovereign debt to be paid off is with a much cheaper Euro.

The Germans, of course, will hate it the most — but so will individuals whose savings, in Euros, are greater that their debts. It would, of course, also hurt all those trying to boost their economies by exporting to Europe. All in all, it's a mess.

Wednesday, September 21, 2011

Obama Mans Up

It is good to see Our President taking up the populist banner and telling us it's time to "soak the rich." I guess Plouff and Axelrod finally figured out that the old Clinton approach of "triangulation" wasn't working, and it was time to try the old Clinton approach of "doing whatever the polls say." A sizable majority of Americans want the rich to pay significantly higher taxes. Now, so does Obama.

"Class warfare," say the Republicans. I don't know about you, but I saw the class war begin thirty years ago, and guess what, fellow proletarians? We lost. If there really were any "class warfare" going on now, it would have to be a counterrevolution. The rich won the war outright, culminating in the Bush income tax cuts and, more important, the reduction of capital gains taxes to 15%.

I'm still not at all persuaded that Our President is on Our Side, but if it keeps Rick Perry out of the White House, whatever chicanery he attempts is okay with me. More important, delivering a strong, populist, anti-fat cat message could help the Democrats weaken or break the Tea Party grip on the Republican Party and the House, and also hang onto the Senate.

As for economic stimulus, the new tax proposals, even if they were enacted into law, would not do any more than the similarly doomed JOBS proposal; but, like the JOBS plan, they make for good politics. Anyway, the actual proposals don't matter, provided the president is seen as aggressively asserting his belief in them.

An unspoken but obvious truth of American politics is that independents don't know enough to make rational choices. Granted, most registered Democrats and Republicans also don't know shit from Shinola, but at least they have people telling them what to believe.

Independents ignore policy, and vote based on personalities. They particularly look for strength. One must hope that fourteen months is long enough for America to get over its perception of Obama as a wimp. If not, a raging asshole like Rick Perry might be our next president.

Friday, September 16, 2011

The Vickers Commission

Regular readers of this blog are familiar with my view on the repeal of Glass-Steagle back in the last days of the Clinton administration, and my view of Bill Clinton for signing it. Irregular readers, I suppose, should be made aware that my feelings about that action are far more uncomfortable than their constipation.

The British, at least, seem to see the problem in allowing retail banks and investment banks to be one in the same. Governments that provide deposit insurance, when banks are on the brink of failure, find themselves facing the necessity to bail out the whole institution — thereby making whole investors, speculators, and just plain gamblers as well as depositors.

What Sir John Vickers and his colleagues have come up with, for the UK, is a plan to "ringfence" the segments of the banking industry that serve ordinary consumers and businesses, while letting the "players" eat their losses. It sounds like a good idea to me, albeit a bit odd. The too-big-to-fail institutions, under the Vickers plan, could be allowed to fail — while their retail subsidiaries would be saved. Go figure.

Well, if that's all that's politically possible, I say, "Go for it." The British, according to all the talking heads I've heard, are likely, indeed, to "go for it." Here in the USofA, of course, anything similar wouldn't be at all likely. The banks still own both our political parties, and they're still working (with nauseatingly predictable success) to eviscerate Dodd-Frank, which wasn't a particularly strong bill in the first place.

What we really need, of course, is a return to Glass-Steagle — which would require the megabanks to split their investment and retail segments into separate companies, and might encourage a bit more healthy fragmentation along the way.

2008 should have taught us that too big to fail is to big to exist.

Sunday, September 11, 2011

Remembering 9/11

On the morning of September 11, 2001, I woke up in the guest room of my mother's condo in Margate, Florida. I was due to start driving back to New York that morning. She was saying something about somebody blowing up the World Trade Center.

My mother was suffering from dementia, and it was getting worse. I'd been in Florida all the previous week, trying to get her life straightened out, and to figure out how long I could let her stay on her own. When she told me about the World Trade Center, I thought she must have been watching the History Channel — a show about the 1990 attempt — and mistaken it for the news.

I made my way to the kitchen, and looked at her little TV. A minute later, the second plane struck.

Mom thought I should stay a few more days, but I wanted to get home. I had to get home. I got out on the road, listening to the radio. In South Carolina, I stopped for gas. The attendant noticed my New York tags.

"Did you know anybody got kilt?" he asked me.

"I don't know," I told him. "I just have to get home."

"I'll pray for you," he said.

Inside the station, the walls were hung with NRA banners, American flags, and a big portrait of Ronald Reagan. "These people," I thought, "are my polar opposites, but they're going to pray for me." Throughout the South, everywhere I stopped, my New York plates brought me special kindness and sympathy. It was the only time, in my frequent travels up and down I-95, that ever happened. I would leave a rest stop with fresh coffee, think about just how goddamned nice people could be, and drive on with tears rolling down my face.

I drove straight through the night. As I came closer to home, I heard about bridge and tunnel closings, and wondered if I'd be stuck in New Jersey for who knew how long, but I got lucky. I hit the Verrazano Narrows Bridge during about a two hour window when it was open. When I got onto the Brooklyn-Queens Expressway, mine was the only car on the road. If you know the BQE, you know that never happens.

There is one section of the BQE where the eastbound lanes run underneath the westbound lanes, and the roadway makes a wide turn. As I came around that turn, lower Manhattan came into view across the river.

I'd seen the endlessly repeated video of the impacts on every TV at every gas station and rest stop along my way. Now, though, I was seeing what was left. It was still dark, but the scene was lit with floodlights. Two giant columns of smoke went up and up until they disappeared into the sky.

Eventually, I got home and collapsed into bed. Of all the times I've driven between Margate and Long Island, that was the fastest I've ever done it.

It wasn't long before the war drums were beating. Many of us marched against invading Iraq, but it made no impression on anybody in power. All the major news media were caught up in a patriotic frenzy, and none of them seemed to be paying attention to the available facts. Some of the Southerners who had prayed for us New Yorkers on 9/11 were saying that the attack was God's punishment for our sinful, liberal ways.

National unity lasted about a week. Now, ten years later, our country is more balkanized than ever.

Friday, September 9, 2011

The JOBS bill: weak economics, great politics

Yes, having listened to the Republican debate, I felt obliged to listen to the President's "JOBS" speech as well. Since it was a bit more subtle than the debate, I listened twice.

The first thing I noticed, of course, was that Obama was taking an aggressive tone — something he hasn't done since before he was elected. I'm wondering if David Plouffe, chief Obama political adviser and architect of Clinton's "triangulation" approach, might be tendering his resignation soon. Damn, I hope so, but I suppose that even Plouffe must have learned something over the past two years. It really is time for a new, ballsier* Obama.

*[Surprisingly, the word "ballsier" is not identified as a spelling mistake by my computer's dictionary.]

I liked the fact that the White House "leaked" a $300 billion proposal, then came through with 50% more. Maybe Obama is finally getting the hang of how to negotiate. By presenting the Republicans with policies they supported in the past, he leaves them with the choice of going along with most of it, or looking like the obstructionists they are. Count on seeing about $300 billion worth of stimulus.

The new stimulus package, based on politics rather than economics, will do little or nothing to create new jobs, of course. I suppose it's conceivable that a further extension of unemployment benefits might make it through the House, but I wouldn't place any bets on it. That leaves the payroll tax cuts, the infrastructure projects, and some state aid.

Tax cuts rarely increase demand. Payroll tax cuts for workers only affect people who already have jobs. Some of them will use the extra money to pay down debt, and most of the rest will use it to increase savings in the face of job insecurity. (When their jobs are insecure, workers tend to take defensive stances — not yell "Whoopie!" and buy a new sofa or a trip to Vegas.) If employers get cuts to their share of payroll taxes, they'll just pocket the money. They won't hire new workers unless there's a lot of new demand — demand that can't be met by bleeding their existing workers dry.

As for the infrastructure projects, they're unlikely to generate new jobs for a year or two. Granted, we'll certainly still need those new jobs in a year or two, and the jobs have to be done, but I can't see any great increase in construction jobs any time soon.

As I've said many times before, though, federal aid to the states can be one of the best things Congress can do. Yes, it will be too little, too late, but at least some jobs could be saved — provided the aid is targeted at keeping state and local employees from losing their jobs. We really don't need any more subsidized sports arenas, for example, providing short-term construction jobs followed by long-term tax drains.

To me, the jobs bill the President will be sending along to Congress was a pleasant surprise. It already has the likes of Eric Cantor on the defensive, and it just might give the Democrats a boost in the next elections.

On the other hand, it's hard to imagine any real economic progress any time soon.

Wednesday, September 7, 2011

The Republican Debate

Unlike most of America, I actually watched it. Needless to say, what most of America thinks about it depends on what most of America's individually preferred media have to say about it. Here are some personal impressions:

Rick Santorum's facial expressions, as he listened to the few questions the moderators bothered to address to him, precluded anybody actually listening to whatever answers he eventually offered. "Gee," I thought, "he looks like he comes to school on the little bus." I suspect he won't be around for the next debate. (By the way, the eventual answers were not too impressive either.)

Michele Bachman's hair and makeup were just wrong. There was a bit too much blue eyeliner, and a hell of a lot too much hair lacquer. Many will say that it's a shame that a female candidate's appearance should matter so much, but appearances matter just as much for male candidates as well. As for what she had to say, who knows? She got totally predictable questions, and answered them with generally off-topic talking points.

Newt Gingrich, who knows he's out of it, was just having fun. I kind of enjoyed the way he stirred the pot — when the "moderators" (ha!) gave him the chance. As a long-term pot stirrer myself, I just had to smile.

Herman Cain acquitted himself nicely. Although I suspect nobody in the mostly Tea Party audience was following his "9-9-9" plan, he sounded as if he knew what he was talking about, which, of course, is what matters most. The plan itself would exacerbate the rift between the rich and the poor (and the decimation of the middle class) in the United States, but it is proof that race need not be a significant factor in the class war. Wealth is colorless. Nevertheless, as we're all aware, he doesn't stand a chance.

Jon Huntsman has good hair, but he's a bit too tan. Is that supposed to suggest that he actually spent time outdoors in Afghanistan? If so, I suspect that suggestion might be just too subtle for the Republican base. Anyway, he didn't use the opportunity of the debate to establish himself as a centrist — his only chance to differentiate himself from the pack — and hence made little or no impression at all.

Ron Paul came over as aged and frail, I'm afraid. He's lost the oomph he showed four years ago, and while he tossed a dart or two at Perry, they didn't hit very hard.

So, that leaves Mitt Romney and Rick Perry, the front-runners. In the handsome-off, I thought Romney had a slight advantage tonight — that is, until MSNBC tossed in an homage to Ronald Reagan (presumably because the debate was held at the Reagan Library.) Perry, we could see, looks a lot more like Reagan that Romney does.

The big news, however, will be that Romney wants to preserve Social Security while Perry wants to end it. Given that primary voters tend to be a bunch of old farts like me, I'd say "advantage Romney" for tonight — but you can't, by any means, count Perry out.

Hell. He really looks quite a lot like Reagan.

Sunday, September 4, 2011

Balanced Budget Amendment

Frankly, I don't know why I'm even bothering to write about a balanced budget amendment, because it is now, and always has been, an extraordinarily stupid idea. A balanced budget amendment means that government no longer has access to fiscal policy — and given that monetary policy appears to be totally tapped out at the moment, fiscal is all that's left.

Well, it would be left — if the right-wing crazies were willing to use it — but, no, then the economy might pick up a little and offer a little advantage to the center-right not-quite-so-crazies represented by Our President.

In case anybody reading this is unaware, the states that must balance their budgets tend to do it with tricks — case in point, New Jersey raiding its public employee pension system for a couple of decades — and with federal subsidies. Nobody is going to subsidize the feds, though.

Then, there's that "family" argument. Families do not run balanced budgets, year to year — even the most responsible. Scarcely anybody buys a house or a car without borrowing; and, these days, scarcely anybody gets a higher education without borrowing. They get the economic advantage when they need it, and pay it back over time.

So, just in case you think a balanced budget amendment is a good idea, remember — you're an asshole.

Friday, September 2, 2011

The Speech

We don't know what Barack Obama will say to draw viewers away from the opening game of the NFL season next week, but Robert Reich has thought about it. You will find his thoughts here.

Sadly, his ideas would require that Our President grow a set of balls. I don't see much chance of that happening, of course.

Read Reich. He says it a lot better than I could.

Wednesday, August 31, 2011

The Problem with Keynesian Economics

The problem with Keynesian economics, sad to say, is that it's incompatible with democracy. Ordinary citizens of a democracy — or of any other political system, for that matter — always like more, and never like less. Hence, only half of the Keynesian formula ever is implemented. (Well, maybe "ever" is a slight overstatement, because Bill Clinton sort of moved in the right direction during the boom years of the nineties.)

Until very recently, Keynesianism was almost an automatic response to recession: cut taxes and increase government spending to stimulate the economy. The problems always arose during the good times — the boom times. That's when, according to Keynes, we're supposed to raise taxes and cut government spending, to keep things from overheating and build up a reserve to see us through the next recession.

Unfortunately, that second part of Keynesianism is the hard part. When incomes and profits are up, and lots of tax money is flowing into government coffers, the suck-up politicians of democratic governments say, "Hey! We've got the money! Let's make the voters happy by cutting their taxes and tossing lots of bucks around! While we're at it, we can toss even more bucks at the special interests who pay for our election!"

Everybody's doing better (except for those "fixed income" suckers and the minimum wage crowd, who can't handle the inflation), so everything goes swimmingly until the next recession. It's been going on for about eighty years now.

Note, however, that during those boom times the big benefits go to the special interests — and the most special of those interests, at least since Reagan was president, have been the very rich.

Yeah, I know — if you read this blog, it's not exactly news to you.

So now we're at a point when Keynes (like most contemporary economists) would recommend stimulus. Thanks to eighty years of getting Keynes wrong, though, our national debt is a bit on the high side. The "democratically elected" pols — Republicans, especially, but plenty of Democrats as well — are righteously demanding austerity. But why, especially when we need stimulus so badly, and interest rates are so low?

The answer, of course, goes back to those extra-special interests — the people and institutions that own that debt. They can never be losers, of course, so the rest of us have to pay.

I'm too old and lazy to start a revolution and, frankly, I wouldn't know even where to begin now that revolutions seem to start on Facebook and Twitter. I have to tell you, I'm not optimistic. Any suggestions?

Sunday, August 28, 2011

Rick Perry

I know I'm not allowed to make predictions anymore, but I really think Rick Perry is the most likely Republican presidential candidate for 2012. Needless to say, it has nothing to do with policy, promises, or, for that matter, politics.

He's tall. He has good hair. He's aggressive. He's Texan tough.

Oh, crap! He's the perfect candidate! Not only can he win the Republican nomination, but he can beat Obama in 2012. Americans, by and large being assholes,will ignore the fact that his brains are up his ass, that he's a total lackey of the corporate elite, and that he doesn't believe in climate change, evolution, women's rights, or the scientifically established age of the world.

Those of you old enough to remember when Clinton beat Bush the First will remember the most important advantage Clinton had: back then, they called it "the wimp factor." Yes, G.H.W.Bush was widely regarded as a wimp. Now, let's consider our current chief administrator.

Oh, shit! This time around, wimp is an understatement.

"President Perry" is, to me, about as awful a situation as I can imagine. If he really is the Christian airhead he portrays himself to be, we're in for big trouble. If he's actually the shit eating dog of the capitalist establishment I suspect he might be, we're in for much bigger trouble.

Wimp-in-Chief Obama seems to be trying to grow a set of, at least, marble sized ones lately, but he'd better grow them a lot faster if he wants to hold onto his office. Once, as I recall, he said he'd rather be a good one-term president than an ineffective two-term president. He didn't mention the possibility of being an ineffective one-term president.

But, on the other hand... Rick Perry?

Tuesday, August 23, 2011

What next for Libya?

Now that NATO has enabled the "Libyan rebels" to push Qaddifi (aka Gadaffi, Ghadafi, Khadaffi, etc.) out of Tripoli, it is time to start wondering who will be running the alleged "country" in the future. According to the New York Times, "Colonel Qaddafi proved to be a problematic partner for international oil companies, frequently raising fees and taxes and making other demands. A new government with close ties to NATO may be an easier partner for Western nations to deal with."

This motivation for the invasion has been clear enough from the beginning, but the question remains: who will govern Libya now that Qaddifi, albeit uncaptured and not thoroughly vanquished, is out of power? The situation might prove more problematic than dealing with the old Colonel himself.

The "Transitional National Council," currently "speaking for" the "rebels," seems to consist of expatriates from Europe and the United States, a few defectors from Gaddafi's government (one of whom already has been assassinated), and a couple of tribes traditionally opposed to Ghadiffi's tribe. They are not the stuff of a unified government.

Well, whatever "government" emerges from the wreckage, I suppose there will be some contracts negotiated for Libyan oil. My suggestion, similar to my suggestion for Afghanistan, is that the western powers let the tribes work it out for themselves. Tribalism is the basic political motif for the middle east, so the best idea is to go with it. (Afghanistan, by the way, needs a loya jurga, not an "elected" government, to get it back on the road to nationhood.)

Meanwhile, though, let us all hope that Libya can begin to ship oil again — so that European (and world) oil prices can decline a bit. Will it make up for the expenditures of the Libyan War?

Who knows.

Friday, August 12, 2011


Up, down, up, down, up.

My usual advice regarding the stock market: ignore it. The bitter truth about the stock market is that is has virtually nothing to do with the real economy of people trying to earn a living so as to keep food on the table and a roof over their heads. The markets may affect the sales of Louis Vuitton accessories and all the crap indispensable for accessorizing those accessories, but sales of rice, beans, and gasoline will stay fairly constant.

Granted, it's hard to ignore the market if you're trying to eke out the final few years of your life of thankless labor on the proceeds of a 401k — but equally needless to say, anything you try to do now will be much too little, much too late.

Forget the "confidence fairy." Forget all the conjecture about the impact of this, that, or the other barf-out of the latest "economic data." It doesn't take an economist to figure out that things are, in a manner of speaking, fucked up — and you don't have to be an economist to recognize that your personal investment in the stock market amounts to chicken shit by comparison with the investments of banks, hedge funds, and similar corporate straw men for the plutocrats.

And, no, it NEVER "trickles down."

So what's with the volatility? Okay, there are assholes out there trading for their own accounts, and some of them must be dumb enough to panic when others seem to be panicky and to buy high in bursts of irrational enthusiasm only to see their investments droop like a certain national leader's limp dick. How much can that explain, though, when a great majority of the buying and selling is institutional, and when most of that institutional buying and selling is program trading?

Who has the best algorithm today? Who is the fewest microseconds distant from today's Biggest Board? I'm just guessing that it's not your retirement fund, so how you're doing amounts, pretty much, to pure chance. Just bear in mind, though, that there's a great deal of money to be made in volatile markets — and that somebody is making it.

Wednesday, August 10, 2011

The Riots Across the Pond

I've been listening to the BBC for coverage of the rioting/looting in London and other English cities, and I've come to think that nobody over there actually gets it. In case you hadn't noticed, the class system over there is quite pronounced (including "clahhss," "clawws," "clows," and several others.) The rioters, according to David Cameron's "clahhssmates" from Oxbridge, are the "lowest of the low." They are young, uneducated, and unemployed. They are white, black, and various shades of brown. They are just knowledgeable enough to realize that the only way they ever are likely to have a few nice things is to steal them.

I think it was my favorite senator, Daniel Patrick Moynihan, who first coined the (now very politically incorrect) term, "underclass." Back in Moynihan's day, the "underclass" in the USofA was predominantly black, since race and class were even more closely correlated then. I know I heard that very term on the BBC today, spouted by some Tory twit or another, whose argument seemed to be that "the lowest of the low" are congenitally defective, with no regard at all for their lower-middle-class neighbors struggling to keep their beauty salons and falafel stands unburnt.

It's true. They couldn't care less. They'll never have a beauty salon or a falafel stand. A more upscale Blackberry or pair of sneakers is their height of aspiration.

Cameron and the Conservatives are committed to austerity. So are our homegrown plutocrats and their political allies, from both parties. Here in the USofA, as the rate of teen unemployment and the widening gap between rich and poor continue to increase, our ability to pretend that we really don't have a class system is falling apart. As state and local governments, strapped for cash, cut back on policing, fire fighting, and education, things can only get worse.

'Ow's 'at 'it ya, guvner?

Thursday, August 4, 2011

Hey, what happened?

While I've been calming down from that last post — not to mention the consummation of that Faustian bargain I mentioned — it seems many others have been getting a bit more excited. Today's market plunge may be just more of the "volatility" which indicates that nobody knows what the hell is going on. On the other hand, it just may be that investors finally have figured out that austerity is not likely to be good for their investments.

After all, the corporate world has been sitting on its money and spending bupkes for the past couple of years, and plutocrats tossing their loose change around at Bergdoff-Goodman and Tiffany do not an economy make. When the United States joined Europe in the cult of what Krugman calls "the confidence fairy," it appears many Wall Streeters decided it was time to listen to the economists rather than the Koch brothers.

Then, of course, there's the SUPER-COMMITTEE, whoopie doo! Since the Republicans already have sworn that no tax increase supporters nor loophole closers will be appointed to their six, one supposes they are assuming at least one of the Democratic appointees will be an Obamesque anilinguist (and one assumes that we all can assume they are correct in that assumption. And, okay, I haven't calmed down all that much.)

I know I swore off making predictions a while back, and hence I will refrain — but I just can't see anything good coming out of any of this.

Monday, August 1, 2011

Punk-ass Pussy President Sucks GOP Cock Again

I am sorry that the most visceral words that signify great cowardice in the English language are either misogynistic or homophobic. I'm in a very visceral frame of mind.

Barack Obama is not an idiot, so I assume he realizes that the Faustian bargain he just struck with Boehner and Co. will make anything resembling economic recovery impossible at any time in the foreseeable future. Thing can, and will, get much worse before they get better.

The only hope I see is that Congress turns down the alleged "compromise," forcing Obama to act like a mensch and use executive power to raise the debt ceiling on his own — but would he do it even then? I don't know.

Immediately after publishing this post, I intend to fax my representative in the House to request that he vote "no," but he's a complete party hack who narrowly held onto his seat in 2010, so I don't expect him to comply with my request. After that, I suppose I'll fax the White House so they understand that they can't count on their left-leaning base after such a complete betrayal. I wouldn't vote for Barack Obama again even if it meant risking the election of, say, Louis Gohmert, who is so stupid his district has to send him to Congress on the "little bus."

I may use some visceral language.

Saturday, July 30, 2011


According to a teaser from my local NBC station, "The East Side Groper Strikes Again!"

Gee! Somebody was groped, and he/she was not the first! Very upsetting, indeed!

In the meanwhile, Boehner got a bill past the House by adding a totally crazy balanced budget amendment requirement, and the Senate shot it down. The House, in turn, shot down Harry Reid's allegedly "Democratic" bill, making way for a "compromise" somewhere between the right wing and the starboard side of a flat earth.

Apparently, this is okay with Obama, who made it perfectly clear that he is far too cowardly to invoke the 14th Amendment — or even just common sense. (Common sense suggests that once Congress has spent the money, it is obliged to pay the bill — because a default is the equivalent of declaring bankruptcy. Clearly, the United States cannot be bankrupt while so many of its citizens and corporations have so much wealth.)

And, so, I guess the "warring parties" will get something together before 8/2 replaces 9/11 as the low point in American history. Given the most recent GDP figures, though, one hopes that European style austerity can be delayed for a while — say, five or six years. Otherwise, it's really looking like 1937 all over again.

Anyway, if you think getting groped might actually make you feel better than the rest of what's in the news, head over to the East Side. Maybe you'll get lucky.

Friday, July 29, 2011

Now what?

As of this writing, John Boehner still can't gather enough votes in the House to pass a bill to raise the debt ceiling, despite support from all Republican leaders, presumably including Eric Cantor — although I suspect next-in-line-to-be-Speaker Cantor may be less upset than he appears. If there is no breakthrough today, somebody in Washington may have to show some courage.

We all know who that somebody is, and we all know what he'll have to do. Barack Obama will have to go right ahead and break the 1917 debt ceiling law by ordering Treasury to keep selling bonds after the debt ceiling is breached. Presumably he can find some lawyers willing to write some opinions explaining why he's really allowed to do it. As we all know, it's not hard to find lawyers willing to justify anything. Hell, George W. Bush found lawyers to justify torture.

But who would buy those bonds? Well, Ben Bernanke is no idiot, and I think he could persuade the rest of the Fed to go along. Yes, it means "printing" money, and is likely to put even more downward pressure on the dollar, but inflation hasn't been any sort of problem for the past few years. An out-and-out default would do much more harm.

Yes, Obama would certainly be impeached in the House — creating even more political theater — but he wouldn't be convicted in the Senate. As for his electoral chances, they might improve if he finally showed some balls — portraying himself as the strong leader who finally stood up to the incompetents in Congress.

Thursday, July 21, 2011

The "Gang of Six" Plan

If you haven't read the actual document released by the "Gang of Six," you can download it here. Don't feel intimidated — it's short and not even remotely technical. As a matter of fact, it says pretty much nothing in terms of suggestions for real legislation.

So why is Our President so enthusiastic? Well, it's, sort of, bipartisan. Three extremely conservative (but not Tea Party) Republicans got together with three Blue Dog Democrats, and came up with roughly four pages of mostly conservative talking points. Needless to say, both the left and the Tea Partiers are extremely upset. "Mostly conservative" is what passes for "moderate" these days.

As for me, I continue to hope that Our President has no strong interest in any of these particular talking points, and is using them just to put pressure on the Tea Partying ideologues in the House. All he wants right now is a goddamned increase in the debt ceiling without being forced to raise it himself, without Congressional approval (as I suggested a couple of weeks ago.)

Bill Clinton, it seems, agrees with me. So far, as best I can tell, nobody's heard from W.

Tuesday, July 19, 2011


Schadenfreude? You betcha!

For a few minutes, there, I was hoping Fox News might be caught up in the scandal — but then it occurred to me that Fox doesn't actually do news. They don't have to. Fox subsists on its ability to mirror the perspective of its viewers, reinforcing what they already believe. Fox isn't a tabloid — it's an echo chamber.

If Rupert's boy James deserves to spend some time in jail, and that causes the old man some discomfort and leads to a fracturing of the Murdoch empire, I can't say I'd be terribly upset. If it turns out that young Murdoch, Rebecca Brooks, Lee Hinton, Andy Coulson et al all can maintain their plausible deniability, and manage to duck their responsibility for the hacking, bribery of police, etc., that's also okay with me — at least if there's enough of a tempest in the Murdoch teapot to restrain Rupert's coterie of asslicking politicians until the old man finally dies.

(If the Wall Street Journal is sold to somebody who can restore its journalistic integrity — even with its rabid-right editorial pages intact — that would be especially welcome!)

Sunday, July 17, 2011

Boehner's Dilemma

John Boehner has a problem. Well, okay, he has several problems.

First, despite his nominal leadership of the Republican party, he can't control the troops. Given his long history in the House, this must have come as a surprise to him — if there was anything Republicans have been good at for the past thirty years, it's been party discipline. The Tea Parties seem to have ruined that.

Second, he can't help but feel Eric Cantor's dagger poking at his side, looking for a good soft spot between the ribs. Cantor really wants to replace Boehner as Speaker of the House, and he doesn't seem to mind keeping his party divided against itself to get there.

Boehner is a corporatist, but also a pragmatist. As a corporatist, he prefers not to mess around with the possibility of creating financial meltdown. As a pragmatist, he follows Reagan in the belief that when you get 80% of what you wanted in a negotiation, you've won. When Obama offered up large chunks of Medicare and Medicaid on the altar of "moderation," Boehner was willing to go along with closing a few tax loopholes for the rich.

Cantor saw Boehner's "weakness" as an opportunity to run up to the front of the Tea Party parade with a large bass drum. Although he's been sounding more and more like a Grover Norquist ideologue lately, I suspect Cantor is much better understood as a pure opportunist — a man whose personal ambition far outweighs any party loyalty

After a few drinks the other night, I had this really neat fantasy. It won't come true, of course, but a lot of us would be supremely amused if it did.

John Boehner has lots of friends with money and power. Suppose he quietly encouraged some of them to start a "draft Eric Cantor" campaign for the 2012 presidential race. After all, the current crop of candidates is not especially impressive, and even the Tea Partiers have to be able to see that Cantor has a lot more on the ball than the intellectually challenged Michele Bachman.

I know, very unlikely — but what if Eric Cantor's hubris was great enough to get him to go along with it, and what if he won the nomination?

Why, then you'd have a black man running against a Jew for the highest office in the land! Oh no! Crisis in Redneckland!

As for me, I'd still be poking around the available third-party candidates looking for a place to cast my protest vote — but at least I could have a few good laughs.

Friday, July 15, 2011

More Debt Ceiling Crap

Have you ever watched a game of chicken? Some of us geezers automatically think of the one in that James Dean movie, Rebel Without a Cause. In the case of the debt ceiling, though, two cars driving side by side towards a cliff really isn't the right metaphor. To me, two cars driving on a collision course down a single lane road with brick walls to each side seemed more apropos. It isn't possible for just one of them to step on the brakes and bail out. Either both chicken out or both wipe out.

Then along came that canny little bastard, Mitch McConnell, with a neat idea for creating an exit ramp for the Republicans — a ramp that would allow the Republicans to duck out of the way while Obama drives the country off a cliff and ensures a Republican victory in 2012. There's just one little problem with the McConnell plan.

What if there's no cliff? The Republicans would have chickened out, the economy wouldn't be significantly crappier (albeit still quite crappy), and Obama probably could go on to win another term. Nobody actually knows what a second Obama term would look like, but I'm not betting on a great flowering of liberalism. I figure it will be the same corporatist crap, just minus the worst of the supply side bullshit.

If both parties still are obeying their corporate overlords, McConnell's plan is likely to be the one that flies. It will take a few days for House Republicans to figure out which of them can get away with voting for it and which of them get to beat their chests and vote "no," but it can pass. (Expect, of course, a very close vote.)

Those of us old enough to remember the James Dean movie cannot help but feel a bit cynical. It's only to be expected.

Saturday, July 9, 2011

Regarding what's "on the table"

The June job figures show employment continuing to crash, even as corporate profits increase. Is anybody surprised? The profits are coming mainly from overseas, although "productivity increases" here at home (automation plus increasing worker exploitation) aren't hurting at all.

In his column in yesterday's Times, Paul Krugman pointed out that the president is running very low on economic advisers, and wondered if the political advisers — who, like Obama himself, seem to know very little about economics — might be exerting too much influence. Given the quality of the economic advisers he used to have, I suspect there's not a hell of a lot of difference, but I'm hoping somebody can communicate some sense to him.

First of all, somebody has to pound it into his thick skull that we are not dealing with supply-side problems. It doesn't matter how many tax cuts and tax advantages government tosses at business — they'll just take the money and sit on it, or use it to buy back their own stock or take over other businesses (with concomitant staff "consolidations") or distribute it as dividends to shareholders. None of it will be used to create jobs in the United States as long as Americans can't afford to buy their products.

(The political advisers, of course, will point out that some percentage of "independent" voters have swallowed the supply-side line, and will encourage Obama to "get out ahead" of the Republicans. Obama once said he'd rather be a good one-term president than an ineffective two-term president, but I suspect he was either lying or self-deceiving at the time. I don't have a lot of confidence in Obama — or any of our current political elite — putting the country ahead of their own ambitions.)

If we disregard political ambitions and corporate contributions (har de har har), it makes absolutely no sense to give the corporations "tax amnesty" for bringing overseas profits back to the United States. We tried it back when Bush was president, and all it did was create a great deal of moral hazard, inevitably leading to the current proposal to do it again.

It also makes no sense to cut entitlements, which would serve chiefly to further reduce demand, and make our employment problems even worse. If Obama really has Social Security and Medicare "on the table" in the current talks with the Republican leadership, let's hope he's feeding them a line of bullshit no less stinky than the line they're feeding him about the possibility of increasing tax levies on the plutocrats.

Shit, nobody in either party wants to tax the plutocrats! They are the plutocrats! (Where's the IWW when you need it? We need it now.)

Wednesday, July 6, 2011

The Debt Ceiling Dispute

This week we get to see whether Our President has finally grown big enough balls to stand up to those big bad Republicans. Yes, I know, they're very scary! Some of them are so stupid they may as well be crazy, and some of them have been publicly committed to supply-side voodoo for so long they are incapable of making rational choices.

Obama's biggest problem is that he's backed down so many times there's no reason for even the sensible Republicans — those who are just ordinary politicians — to believe he won't do so again. That means he has to get out ahead of the game this time, even given the fast approaching "deadline" that's supposed to frighten all of us so much.

Here's my suggestion: begin by announcing that there will be no agreement that does not include tax increases for the rich. He should not fudge the language by talking about "closing loopholes" or "eliminating subsidies" — he should come straight out and say "tax increases." The Republicans will, of course, accuse him of "class warfare," but what the hell? America is ready for a little "class warfare" at the moment, and the tea parties should not have a monopoly on populism while so-called conservatives load greater and greater burdens on the backs of the middle class and the poor.

Obama has taken a good first step by rejecting any temporary, stopgap measure that will do nothing but push the problem closer to the 2012 election. He has a history (think of the Bush tax cut extensions) of being nickled and dimed into major concessions, and he shouldn't allow that to happen again.

After drawing his line in the sand, his next step should be to announce that he will instruct Treasury to continue to sell bonds even after the debt ceiling is reached, based on the idea that when Congress votes for spending without raising sufficient revenues to pay the bills, it must be assumed that Congress is empowering the executive to borrow. By the time the Supreme Court issues an opinion on the Constitutional validity of a debt ceiling, breaching it will be a fait accompli, and the debt ceiling no longer could be held hostage by Republican blackmailers.

It's time for the president to start acting more like a scary black man and less like somebody who got his job through an affirmative action program. The only way to deal with bullies is to stand up to them. Barack Obama seems to be beginning to make that attempt. Let's hope he follows through.

Tuesday, June 28, 2011

Greeks v. Banks

We'll see tomorrow if the Greek parliament approves the austerity measures and the deep-discount privatizations the ECB and the richer European countries are demanding for another alleged "bailout." To me, the most likely scenario floating around is that the Greeks will go along with the demands for legislative actions tomorrow, and then just not implement most of them as they come due.

If the parliamentarians are paying attention to the riots in the streets, though, they just
might say "no" to the package. If that happens, we'll have to see what ensues. A collapse of the Eurozone is a real possibility, and that certainly would be disruptive to the world economy.

Of course, there are some of us who think it just might be time to do it and have done with it. Having a single monetary policy and more than two dozen fiscal policies, from my perspective, is not a formula for success. It worked well enough when credit was cheap, borrowing standards were lax, and government leaders could buy support with all that borrowed money. Granted, the Greeks went a bit more overboard than most — and lied their way into the Eurozone to begin with — but the
system was and is essentially flawed.

Whatever the original sins of Greek leaders, though, I could not condemn them if they tell the rest of Europe to screw itself. The interest Greece has to pay on the debt it incurs right now is in the junk bond category. How much higher could it go, and would it really make a difference? Greece can't afford to pay current rates, so higher rates mean nothing. The only sensible thing to do is default now, rather than enter into dubious refinancing schemes and then default for even more later.

The popular jargon for the current bailout proposal is "kicking the can down the road." It makes sense, though, to look at how the road might change a few kicks ahead.

Sarkozy has worked out a deal with private French banks that hold Greek debt to, essentially, roll it over — offer new loans to pay off the old ones (only at higher rates.) The immediate advantage of that for the banks is that it would mean they will not have to
write down the bad debt for another three to five years, leaving their balance sheets looking healthier for a while. If the bailout deal goes through, we can expect other private holders of Greek debt to do the same.

back a little bit, though, and we see what French, German, Swiss, Belgian, and other private European banks have been doing since the last bailout — that is, selling off their Greek debt to the European Central Bank. If they can continue to do that, private losses can be minimized. Losses by the ECB would have to be offset by infusions of capital from European governments — in other words, by the European people as a whole. Fat cats, hedge funds, and corporate investors will transfer their gambling losses to ordinary people.

For the Greeks themselves, selling off public assets like their ports, utilities, railroads, etc. at this time seems like an especially foolish move. As the people in the streets and squares of Greek cities understand very well, not only would the sale of those assets sharply increase unemployment, but they would bring only a fraction of what they're worth. It makes a lot more sense to default first — tell their creditors they're not going to be paid — and save the assets for later sale, when Greece really needs the money. Cut off from credit, Greece finally would be forced to slice away the corruption and patronage from its economy. The nest egg provided by asset sales, if they turn out to be necessary, could be the country's key to survival.

US exposure to Greek debt is quite small, and the predicted domino effect on Portugal, Ireland, Spain, and Italy also would not have great impact on American holders of European debt. What we
don't know, however, is the exposure of US banks and related corporations in the form of credit default swaps. How much of the impending European losses are insured in the US, or in European subsidies of US banks?

Well, we're still kind of in the
process of writing the transparency rules on derivatives, so nobody actually knows.