Measuring the "Success" of American Foreign Policy

The Americans blindly go around the world making bad situations worse while slapping themselves on the back and congratulating themselves about "spreading democracy" and "American values" throughout the world. The poor American public has no idea and little interest in the failed policies of their political leaders.

Here is a bit from an excellent article in the UK's Guardian newspaper giving an example of how Iraq has been "lifted up" from the horrors of Saddam Hussein's dark torture state to the light of a... what? a new torture state...

The walls of Um Hussein's living room in Baghdad are hung with the portraits of her missing sons. There are four of them, and each picture frame is decorated with plastic roses and green ribbons as an improvised wreath for the dead.

Um Hussein had six children. Her eldest son was killed by Sunni insurgents in 2005, when they took control of the neighbourhood. Three of her remaining sons were kidnapped by a Shia militia group when they left the neighbourhood to find work. They were never seen again.

She now lives with the rest of her family – a daughter, her last son, Yassir, and half a dozen orphaned grandchildren – in a tiny two-room apartment where the stink of sewage and cooking oil seeps through a thin curtain that separates the kitchen from the living room.

Um Hussein looks to be in her 60s and has one milky white eye. She is often confused and talks ramblingly about the young men in the portraits as if they are alive, then shouts at her daughter to bring tea. She told the Guardian how she had to fight to release Yassir from jail.

Yassir was detained in 2007. For three years she heard nothing of him and assumed he was dead like his brothers. Then one day she took a phone call from an officer who said she could go to visit him if she paid a bribe. She borrowed the money from her neighbour and set off for the prison.

"We waited until they brought him," she said. "His hands and legs were tied in metal chains like a criminal. I didn't know him from the torture. He wasn't my son, he was someone else. I cried: 'Your mother dies for you, my dear son.' I picked dirt from the floor and smacked it on my head. They dragged me out and wouldn't let me see him again.

"I have lost four. I told them I wouldn't lose this one."

Afterwards, the officers called from prison demanding hefty bribes to let him go while telling the family he was being tortured. Um Hussein told the officers she would pay, but they kept asking for more. First it was 1m Iraqi dinars (£560), then 2m, then 5m.

George Bush was an idiot whose ideology blinded him and allowed him to create horrors under the flag of "nation building" and "bringing democracy to the Middle East".

Obama is a much more sophisticated thinker who actually understands foreign policy, but sadly Obama continues the blunder and outrages of American "policy". It is clear that these horrors go deeper than just an "administration". What the US is doing around the world is obviously driven by a cynical need to control the world for the benefit of the rich elites in the US. The veneer of ideology or the cynical use of worlds like "freedom" and "democracy" and "women's rights" are rolled out to plaster a veneer of respectability to what is in fact a horror story passing for "foreign policy".

Obama's Persecution of Whistleblowers

Here is a talk given by whistleblower Jesselyn Radack:



As Racack points out in the video, the chilling fact is that "supposed left-leaning" Obama has brought more charges against whistleblowers than all previous administrations combined. With "friends" like Obama, the political left has no need for enemies.

Great Recession

There is no better concise picture of the Great Recession than this graph from the Calculated Risk blog:

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This clearly shows that all previous post World War II recessions which had fully recovered employment by 4 years after the start of the recession. Even the pathetic "recovery" brought about Bush's two tax cuts to "inspire" entrepreneurial spirit got employment back to pre-recession levels in four years. But the recession is different. This is a credit crunch just like the Great Depression.

Obama's "stimulus" was pathetically inadequate with one-third of the money going to "tax cuts" which clearly are very poor stimulants (see the four year delay in recovery due to Bush's tax cut strategy). The other two-thirds was money that truly stimluated but was about three to four times too small for the size of the real problem. But Obama spent all of 2009 and 2010 assuring everybody that his stimulus was a Goldilocks "just right" amount. Then in 2011 Obama compounded his mistake by focusing on "deficits" (read austerity budgets) instead of stimulation to get the economy to come back.

The US economy is in a complete mess because both major political parties are more interested in catering to corporate interest than they are in the people and the real economy. They both spin masterful stories about how their policies are "effective" when it is utterly evident that they fail. Of course the Republicans are grievously wrong-headed. The Democrats at least pretend to cater to the interests of the 99%, but in reality they are just junior partners with the Republicans in acting as the minions of Wall Street, big corporations, and the ultra-rich. Tragic.

EFF's List of Shame

Here is a list of US government "secrecy" actions that are mindless and counter-productive published by the Electronic Frontier Foundation (EFF):

As the year draws to a close, EFF is looking back at the major trends influencing digital rights in 2011 and discussing where we are in the fight for a free expression, innovation, fair use, and privacy.

The government has been using its secrecy system in absurd ways for decades, but 2011 was particularly egregious. Here are a few examples:

• Government report concludes the government classified 77 million documents in 2010, a 40% increase on the year before. The number of people with security clearances exceeded 4.2. million, more people than the city of Los Angeles.


• Government tells Air Force families, including their kids, it’s illegal to read WikiLeaks. The month before, the Air Force barred its service members fighting abroad from reading the New York Times—the country’s Paper of Record.


• Lawyers for Guantanamo detainees were barred from reading the WikiLeaks Guantanamo files, despite their contents being plastered on the front page of the New York Times.


• President Obama refuses to say the words “drone” or “C.I.A” despite the C.I.A. drone program being on the front pages of the nation’s newspapers every day.


• CIA refuses to release even a single passage from its center studying global warming, claiming it would damage national security. As Secrecy News' Steven Aftergood said, “That’s a familiar song, and it became tiresome long ago.”


• The CIA demands former FBI agent Ali Soufan censor his book criticizing the CIA’s post 9/11 interrogation tactics of terrorism suspects. Much of the material, according to the New York Times, “has previously been disclosed in open Congressional hearings, the report of the national commission on 9/11 and even the 2007 memoir of George J. Tenet, the former C.I.A. director.”


• Department of Homeland Security has become so bloated with secrecy that even the “office's budget, including how many employees and contractors it has, is classified,” according to the Center for Investigative reporting. Yet their intelligence reports “produce almost nothing you can’t find on Google,” said a former undersecretary.


• Headline from the Wall Street Journal in September: “Anonymous US officials push open government.”


• NSA declassified a 200 year old report which they said demonstrated its “commitment to meeting the requirements” of President Obama’s transparency agenda. Unfortunately, the document “had not met the government's own standards for classification in the first place,” according to J. William Leonard, former classification czar.


• Government finally declassifies the Pentagon Papers 40 years after they appeared on the front page of the New York Times and were published by the House’s Armed Services Committee.


• Secrecy expert Steve Aftergood concludes after two years “An Obama Administration initiative to curb overclassification of national security information… has produced no known results to date.”


• President Obama accepts a transparency award…behind closed doors.


• Government attorneys insist in court they can censor a book which was already published and freely available online.


• Department of Justice refuses to release its interpretation of section 215 of the Patriot Act, a public law.


• U.S. refuses to release its legal justification for killing an American citizen abroad without a trial, despite announcing the killing in a press conference.


• U.S. won’t declassify legal opinion on 2001’s illegal warrantless wiretapping program.


• National Archive announced it was working on declassifying “a backlog of nearly 400 million pages of material that should have been declassified a long time ago.”


• The CIA refused to declassify Open Source Works, “which is the CIA’s in-house open source analysis component, is devoted to intelligence analysis of unclassified, open source information” according to Steve Aftergood.


• Twenty-three year State Department veteran gets his security clearance revoked for linking to a WikiLeaks document on his blog.


• The ACLU sued asking the State Department to declassify 23 cables out of the more than 250,000 released by WikiLeaks. After more than a year, the government withheld 12 in their entirety. You can see the other 11, heavily redacted, next to the unredacted copies on the ACLU website.

The ACLU said it sued the State Department in part to show the "absurdity of the US secrecy regime."

Go to the original EFF posting to access the embedded links.

The Bush administration was blatant in its disregard for law and its disrespect for sensible security. The Obama regime is more devious. It gives the pretense of "concern" but its actions belie the truth. There is little difference between the Republicans and the Democrats. They both believe in the "mushroom theory" of government: keep the people in the dark and feed them shit.

A Rationalist in an Irrational World

Here is poor Paul Krugman taking on his enemies one more time. Sadly, they don't want to listen. Politics in the US is a dialog of the deaf:

Why did I criticize Bush’s deficit-increasing policies, then call for more deficit-increasing policies from Obama?

Part of the answer is the difference in economic conditions. Deficit spending is expansionary when the economy is in a liquidity trap; it does nothing but crowd out other spending when you’re not up against the zero lower bound, and the Fed will just raise rates to offset fiscal expansion.

The other part of the answer is that although the Bushies were happy to use Keynesian arguments to justify their tax cuts, those cuts were all designed to be permanent — that is, they were irresponsible precisely because they weren’t temporary. None of what Obama has done commits that sin: his long-term spending, basically on health reform, is paid for, and everything else, like aid to state and local governments or expansion of unemployment benefits, was both designed to be temporary and has proved temporary in reality.

Ah well — just another day in political Bizzaroworld.

The Whole Dirty, Ugly $7.77 Trillion Truth is Now Revealed

The secret actions of the US government to keep the US banking system from complete collapse are now available. You can now read the gory details of how the US government "on behalf of the taxpayers gave away $1.2 trillion on Dec. 5, 2008 and, when you add up all the "free money" the banks got, it totals $7.77 trillion.

From a Bloomberg News article:

Secret Fed Loans Helped Banks Net $13B

The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. Now, the rest of the world can see what it was missing.

The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day. Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates, Bloomberg Markets magazine reports in its January issue.

Saved by the bailout, bankers lobbied against government regulations, a job made easier by the Fed, which never disclosed the details of the rescue to lawmakers even as Congress doled out more money and debated new rules aimed at preventing the next collapse.

A fresh narrative of the financial crisis of 2007 to 2009 emerges from 29,000 pages of Fed documents obtained under the Freedom of Information Act and central bank records of more than 21,000 transactions. While Fed officials say that almost all of the loans were repaid and there have been no losses, details suggest taxpayers paid a price beyond dollars as the secret funding helped preserve a broken status quo and enabled the biggest banks to grow even bigger.

“When you see the dollars the banks got, it’s hard to make the case these were successful institutions,” says Sherrod Brown, a Democratic Senator from Ohio who in 2010 introduced an unsuccessful bill to limit bank size. “This is an issue that can unite the Tea Party and Occupy Wall Street. There are lawmakers in both parties who would change their votes now.”

The size of the bailout came to light after Bloomberg LP, the parent of Bloomberg News, won a court case against the Fed and a group of the biggest U.S. banks called Clearing House Association LLC to force lending details into the open.

...

The amount of money the central bank parceled out was surprising even to Gary H. Stern, president of the Federal Reserve Bank of Minneapolis from 1985 to 2009, who says he “wasn’t aware of the magnitude.” It dwarfed the Treasury Department’s better-known $700 billion Troubled Asset Relief Program, or TARP. Add up guarantees and lending limits, and the Fed had committed $7.77 trillion as of March 2009 to rescuing the financial system, more than half the value of everything produced in the U.S. that year.

“TARP at least had some strings attached,” says Brad Miller, a North Carolina Democrat on the House Financial Services Committee, referring to the program’s executive-pay ceiling. “With the Fed programs, there was nothing.”

...

The Fed says it typically makes emergency loans more expensive than those available in the marketplace to discourage banks from abusing the privilege. During the crisis, Fed loans were among the cheapest around, with funding available for as low as 0.01 percent in December 2008, according to data from the central bank and money-market rates tracked by Bloomberg.

The Fed funds also benefited firms by allowing them to avoid selling assets to pay investors and depositors who pulled their money. So the assets stayed on the banks’ books, earning interest.

Banks report the difference between what they earn on loans and investments and their borrowing expenses. The figure, known as net interest margin, provides a clue to how much profit the firms turned on their Fed loans, the costs of which were included in those expenses. To calculate how much banks stood to make, Bloomberg multiplied their tax-adjusted net interest margins by their average Fed debt during reporting periods in which they took emergency loans.

...

The U.S. jobless rate hasn’t dipped below 8.8 percent since March 2009, 3.6 million homes have been foreclosed since August 2007, according to data provider RealtyTrac Inc., and police have clashed with Occupy Wall Street protesters, who say government policies favor the wealthiest citizens, in New York, Boston, Seattle and Oakland, California.

The Tea Party, which supports a more limited role for government, has its roots in anger over the Wall Street bailouts, says Neil M. Barofsky, former TARP special inspector general and a Bloomberg Television contributing editor.

“The lack of transparency is not just frustrating; it really blocked accountability,” Barofsky says. “When people don’t know the details, they fill in the blanks. They believe in conspiracies.”

In the end, Geithner had his way. The Brown-Kaufman proposal to limit the size of banks was defeated, 60 to 31. Bank supervisors meeting in Switzerland did mandate minimum reserves that institutions will have to hold, with higher levels for the world’s largest banks, including the six biggest in the U.S. Those rules can be changed by individual countries.

They take full effect in 2019.

Meanwhile, Kaufman says, “we’re absolutely, totally, 100 percent not prepared for another financial crisis.”

There is a lot more detail. Go read the whole article.

Freedom of the press is essential to a democracy. The fact that Bush and Obama administrations fought bitterly to prevent the electorate from knowing what sweetheart deals they gave the banks should be fully understood by American citizens. The US government is deeply corrupted by the banking system.

The fact that nobody has gone to jail for the multiple trillion dollar fraud committed by banks, mortgage brokers, assessors, ratings companies, and the big Wall Street banks that "financialized" junk debt into AAA bonds that quickly went bankrupt cries out for justice. The US government is fighting this tooth-and-nail. Heads must roll. The corruption must be rooted out.

The Occupy Wall Street and the Tea Party movements both agree on this one fact: the US political system has been corrupted by the banks.

Worst of all, the ultra-rich show complete contempt for the bottom 99%, the ordinary taxpayers and working stiffs, who don't get tax cuts and "special deals" from the government:

America's Great Recession

The failure of Bush and now Obama to seriously engage in stimulating a failing economy has created a "lost decade". From Calculated Risk, here is a graph that shows the great chasm of lost jobs compared to other post-WWII recessions:

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The inability of America's political leadership to break the bonds of servitude to Wall Street and big corporate interests means that the bottom 99% will pay and continue to pay for the sins of the political leadership and the rich elite in the US. Tragic.

The Depth of the US Housing Depression

Here are some facts from a story in Vegas Inc:

“In less than four years, more than 100,000 homes in Las Vegas have been lost through foreclosure. That’s 18 percent of our privately owned housing stock: that’s nearly one home in five. And we’re nowhere near finished with foreclosures. In all likelihood, we have another 100,000 yet to go, and at the current rate, that’s another four years,” Murphy said.

And this has hit house prices hard. Just in the last year:

In a market hit by high unemployment (13.6 percent) and an elevated foreclosure rate, the Realtors said the median price of single-family homes sold in October was $121,000. That’s down 1.9 percent from $123,400 in September and down 9 percent from $133,000 a year ago.

From the Calculated Risk site, the price of homes in Las Vegas is down 60% since the beginning of 2007:

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What is tragic is that the Republicans caused this Great Recession during the Bush administration and are doing everything they can to make it worse in order to win in 2012. And the salt in the wound is that Barack Obama had a chance to come in and really push hard to save Main Street after the failure of Wall Street, but he played "political games" and undersized the stimulus in early 2009 and then claimed it was "just right" in size when it was clearly too small and dithered for two and a half years before he got serious about attacking unemployment and the crushed economy... just in time to win another 4 years for his "do nothing" administration. Tragic.

How $700 Billion in Bad Debts Destroyed the World Economy

Want to understand how $700 billion in bad loans could take down a $14 trillion US economy and a $70 trillion world economy?

In an infamous speech on May 17, 2007 Ben Bernanke assured the world that the size of "bad loans" was limited and any problem with defaults would be "contained" and not have a big effect on the world's economy:

All that said, given the fundamental factors in place that should support the demand for housing, we believe the effect of the troubles in the subprime sector on the broader housing market will likely be limited, and we do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system. The vast majority of mortgages, including even subprime mortgages, continue to perform well. Past gains in house prices have left most homeowners with significant amounts of home equity, and growth in jobs and incomes should help keep the financial obligations of most households manageable.

But as Matt Taibbi points out, the banks took that bad debt and effectively xeroxed it again and again makes copy after copy that it sold into the world's "derivatives" market ballooning the real losses up into trillions and trillions that were untraceable because the idiot US government under Greenspan, Bernanke, Summers, Rubin, and Geithner refused to regulate the derivatives markets despite the efforts by Brooksley Born to try and regulate it.

Here is the relevant bit from a post by Matt Taibbi on his Rolling Stone blog. Look at the bolded bit for the key fact:

Apparently people feel that by explaining how the banks profited from the explosion of subprime home loans, I’m somehow letting the ordinary homeowner who over-borrowed off the hook.

But the question was never, Do ordinary homeowners share any blame for the crisis? The question, as implicitly posed by Bloomberg, was, Is it true that the banks had NO blame for the crisis?

We can all argue about how big of a slice of the blame pie should be doled out to other actors – the irresponsible homeowner, the corrupted ratings agency analyst, the sleeping regulator, the do-gooder liberal congressman, etc. – later on. But what the mayor said, and Wall Street flaks have been saying for years, is that the banks shouldn’t eat any of that pie, and that they only made those loans because they were forced to, by Barney Frank and Franklin Raines and other such liberal meddling kids.

So let’s examine that for a minute.

For one thing, we know, because of investigations like Carl Levin’s inquiry into Washington Mutual and its subsidiary Long Beach, that these banks were often well aware that fly-by-night lenders like Countrywide and Long Beach were committing fraud on a massive scale – and bought their loans anyway, knowing they could still sell them off on the secondary market.

In 2005, for instance, Washington Mutual did an internal audit of two of Long Beach’s biggest offices, one in Downey, California, and one in Montebello, California. They found that 53 percent of the Downey loans involved some type of fraud, while the number in Montebello was 83 percent. The internal investigation drummed up the usual litany of unsafe financial sexual practices, using white-out to disguise low income levels, cutting and pasting info from good borrowers onto the loan applications of less worthy applicants, and so on.

So you know what WaMu did about all that fraud they found? Zip.

The company overrode its auditors and sold those phony loans off into the market anyway. And internally, they did nothing to change lending practices. WaMu did a follow-up investigation in 2007, and found the fraud rate at Montebello was still 62 percent.

So forget about the banks being dragged, kicking and screaming, to take on even legitimate loans for unworthy, overextended homeowners. Not only did the banks willingly take on every conceivable real home loan, government-backed or not – they even wanted the fraudulent loans, the loans that were not just likely to fail but virtually guaranteed to fail.

Why? Because they could. Because they were making huge profits hawking these bad loans to third-party customers who didn’t know what they were buying.

But here's the real kicker: when the banks milked the Countrywides and Long Beaches dry, and ran out of real people with pulses to lend homes to, they went out and made derivative copies of those "unworthy” lenders supposedly forced upon them by Barney Frank, and sold those copies off on the secondary market.

In other words, they were so “reluctant” to give that Oakland janitor a house that once they had his loan on their books, they promptly Xerox-copied him in the form of synthetic derivatives (essentially, bets on his home loan) and sold him off in five, ten, fifteen different directions. Janitor takes out home loan, bank tells two friends, and those friends tell two friends, and so on, and so on. The banks sold every one of those endlessly-replicating little squares and made cold hard cash each time.

You remember that notorious Abacus deal that Goldman Sachs was involved with, the one in which a pair of European banks, the Dutch bank ABN-Amro and the German Bank IKB, lost a billion dollars buying a portfolio of designed-to-fail mortgage-backed instruments hand-picked by a short selling billionaire named John Paulson?

Well, that portfolio that Goldman and Paulson dumped on those two banks was not, in fact, a portfolio of real subprime home loans. It was a synthetic CDO – a giant package of bets on subprime home loans.

Mike Bloomberg wants you to believe the banks didn’t want anything to do with those unworthy borrowers. Yet in reality, the banks not only went to every conceivable length to take on the home loans of those subprime borrowers, they actually invented new technology to make clones of those Barney Frank debtors.

And there were thousands upon thousands of those synthetic deals, meaning each and every of those deadbeat subprime borrowers have been Xeroxed by the banks fifty or a hundred times over, and are flying around the globe to this day as toxic assets.

Nomi Prins pointed out in her book It Takes a Pillage that we could have paid off every subprime loan in America at the start of the crisis for about $1.4 trillion dollars. But the bailouts ended up being four, five, perhaps as much as ten or twelve times that size.

Why? Because we weren’t paying off the underlying loans of those subprime, personal-responsibility-deficient homeowners. We were paying off the banks' bets on those loans. We were adopting all those clones they made.

Anyway, there's is a massive gap between making a bad decision with one’s personal finances and committing criminal fraud in billion-dollar amounts. Morally, the two acts are not even in the same universe.

The real crime is that Bush's administration refused to regulate the financial system and the Obama administration has refused to clean up Bush's mess and prosecute the trillion dollar fraud that destroyed the world's economy.

The Credo of a Pro-99% Person

I enjoy following many blogs. One of this is Myrmecos by Alex Wild. It specializes in ants and photography and insects. But today he posted a bit of musing on the political future of the US. This is well worth reading:

Why I support the 99% movement

by myrmecos

Paraguay is the second poorest country in South America. You’d never know it from visiting some neighborhoods in the capital city of Asunción, though. Shiny new SUVs cruise the streets between the golf course and the yacht club. Boutique malls sell the latest in European fashion. Not a bad country for enjoying the good life.

I lived in Paraguay for a time in the late 1990s, but not anywhere near the country club. I was a Peace Corps volunteer in a dusty frontier community 100 miles off the paved road. With a government salary of $220/month I was the wealthiest person on my street. My neighbors, for comparison, had 11 children and somehow made do on about $400/year they made selling tobacco to a local distributor and onions in the nearby village. Many small farmers subsisted in the short term on bank credit, a sort of debt servitude that, carried out over years, funneled resources out of the community and upward to the elite. In the long term, some eventually lost their land and migrated to the city where I lost track of them. The slums were always growing around Asunción’s outskirts.

Most of the land was owned by only 350 people, according to a newspaper article in 1998. This statistic startled me, and explained a great deal of Paraguay’s dysfunction. 350 was half the size of my high school graduating class! The country was being run by an exclusive club of millionaires that all knew each other and, for the most part, didn’t pay much attention to the poor folks.

Paraguay was ostensibly a democracy, a 1989 coup having deposed a long-standing dictator. But the elections remained theater. A few rival millionaires would emerge from their mansions long enough to film TV spots featuring them bravely clearing brush at the ranch riding about on horseback looking folksy. To remove any remaining doubt about their populist roots, they would then toss a few bribes to the voters the week of the election. My community at the forest’s edge got free chainsaws. Thanks, General Oviedo!

In spite of the country’s political corruption, I am fond of Paraguay. The people are friendly, the natural history is rich, and the climate warm and forgiving. After my tour was up, I considered starting up a beekeeping operation and staying in country. After all, I calculated that I only needed about 30 hives to sustain a basic campo lifestyle.

In the end, though, I decided against it. The crime rate was phenomenally high, the ambient poverty depressing, and as an outsider the pervasive corruption certainly didn’t work in my favor. The society simply did not function well, and although it contained great charm it was too often punctuated by avoidable tragedy.

Mostly, I never had the security I felt in the middle class in the United States. In fact, Paraguay didn’t have much of a middle class. The wealthy were wealthy, the poor were poor, and any social mobility tended to be downwards.

Paraguay has natural resources: fertile soil, navigable rivers, and a pair of world-class hydroelectric projects. But the wealth never spreads beyond the aristocracy. The powerful have little incentive to run the country to benefit anyone but themselves. Income inequality was not just a problem, it was the single biggest obstacle to any sort of improvement to the lives of the populace.

It didn’t matter if you wanted to implement a liberal program, or a conservative program, or to regulate, or to deregulate. Ideology didn’t even really matter. If the aristocrats could make money, it would happen. If it would cost them money, it wouldn’t. Unless their family was involved. They’d fire competent staff to replace them with a nephew. If you knew the right people you wouldn’t have to work hard; if you didn’t you were basically stuck. If the powers that be didn’t like a new law, it’d never be enforced. If, heaven forbid, a rivalry among the aristocrats escalated, someone got killed. Paraguayan government was corruption in near-textbook purity, and the scam was all possible because the immense resource gap between the rich and the masses meant no one from within the system could challenge it.

Now, back to the United States.

I am not enjoying watching my own country develop the same internal dynamic that corroded the heart of Paraguayan society. As power and wealth concentrate upwards, the ability of a democracy to function in the interests of its people falters. Forget free markets, or single-payer health care, or whatever your hobby horse happens to be. None of it- left, right, or center- will happen once corruption becomes endemic. And corruption is a major product of wealth disparity.

This is why I support the 99% & Occupy movements. At long last they’ve gotten Americans talking about our nascent Aristocracy. I love Paraguay, but if I wanted to live in that sort of system I’d rather move back there than grow a banana republic at home.

I love the snide put-down of Bush and is "brush clearing" preoccupation while president of the US. He and all the multi-millionaire rulers of America have created the problem by letting the middle class collapse in favour of their billionaire buddies.

Free Spending Liberals and Tight-Fisted Conservatives

Here's the real lay of the land. From a blog post by Barry Ritholtz on his The Big Picture blog:

The actual budgets of the Presidents and their deficits — that’s what this is about, right? — are as follows:

George W. Bush is sworn in on January 20th, but his first budget does not take effect until October 1, 2001:

10/1/2001: Bush starting deficit – $5.8 trillion

9/30/2009: Bush ending deficit – $11.9 trillion

Bush debt contribution: $6.1 trillion

Barack H. Obama is sworn in on January 20th, but his first budget does not take effect until October 1, 2009:

10/1/2009: Obama starting deficit – $11.9 trillion

9/30/2011: Obama ending deficit – $14.8 trillion

Obama debt contribution: $2.9 trillion

Of the $14.8 trillion in total debt as of September 30, 2011, the Bush budgets generated $6.1 trillion in deficits versus the $2.9 trillion of Obama deficits. That’s 41.2% vs 19.6% by a reasonable methodology of measuring presidential debt.

For those who don't believe the above and have seen "other numbers". Here's the explanation:

The data was assembled in the original post is not by each President’s first day in office to his last, but rather, by the budgets each President submits to Congress that gets passed. (Congress may change the budget, but rarely appropriates more than what the President requests). I cannot imagine that any fair-minded person would look at this data any other way: The debt each President creates is a function of the budgets each President submits to congress. It is not based upon the literal time they spend in office. Therefore the only objective way to view the data is BY EACH PRESIDENTS BUDGET.

This is not an insignificant point. So, rather than indulge in irrelevant measures that mislead the reader, let’s go to the actual fiscal numbers of each President’s budgets to see what there is to see.

On January 20th, 2001, George W. Bush was sworn into office – but the budget for most of the rest of that year was Bill Clinton’s, passed by the prior Congress. Barack Obama was sworn in on January 20th, 2009 – but the budget for most of that year was that of George W. Bush. Why are these so? Because the Federal government’s fiscal year runs from October 1 (of the previous calendar year) to September 30. Hence, the FY 2001 is Clinton’s and FY 2002 is Bush’s. FY2009 is Bush’s, FY 2010 is Obama’s.

If you don't go by presidential budget, but use "day of inauguration", then you get this skewed representation of reality:

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The above shows a big debt under Obama, but this is the debt committed to by Bush under a Bush budget and a Republican Congress. This wasn't Obama's budget.

You have to be very careful of your "facts". It is all too easy to pick and choose "facts" and distort reality.

Here is the honest accounting of debt under presidents using each president's budget as passed by Congress:

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Inside Job

I watched the documentary Inside Job tonight. It is an excellent review of the fraud and corruption behind the 2008 financial crisis. The film makes it very clear that the entire industry is corrupt and it has completely corrupted the government including both major parties in the US.



If you want to understand the Occupy Wall Street protests, watch this film!

If you want to understand the true scope of the crime of the Wall Street bankers, go look at these pictures and read the stories of these people.

And here is MSNBC's Dylan Ratigan praises the movie Inside Job and briefly talks to the director Charles Ferguson and to Bill Black, the 1990s savings & loan regulator who cleaned up that mess and has been publishing lots and lots on the 2008 fraud and corruption:



Go watch this movie. I borrowed my copy from the library. Go get your hands on it and watch it!

How to Successfully Live in a Police State

Here is yet another example of the West's descent into a police state under the "War on Criminality" (or was that a "War on Terrorism"?) initiated by George Bush but vigorously prosecuted under Barack Obama. From a post by Cory Doctorow on BoingBoing:

Scottish mall-cop: it's illegal to take pictures in the mall; Scottish cop: photographers can have their devices confiscated under terrorism laws

by Cory Doctorow

A security guard in Braehead shopping centre near Glasgow questioned a man who was taking pictures of his young daughter looking cute while eating an ice-cream. The guard told him that photography in the mall was "illegal" and demanded that he delete any photos he'd taken while there. When the man told him he'd already posted the photos to Facebook, the guard summoned a policeman, who said that he could confiscate the phone under the UK's terrorism laws. The policeman took his details and "he was eventually allowed to leave."

The official statements from the mall and the police are maddeningly bureaucratic and every bit as stupid as the original incident: "a full review of the circumstances surrounding the incident and the allegations made is under way" say the police; "Our priority is always to maintain a safe and enjoyable environment for all of our shoppers and retailers," says the mall.

Just a reminder: pretty much everything that's legal on the public street is legal in a private store. A store or mall can have a policy saying "You can't wear purple here" or "You must enter the premises backwards" or "No photography allowed," but those are policies, not laws. A store's representatives can ask you to leave for violating their policies, but that's pretty much it (of course, if you refuse to leave, that's a different matter).

The "War on Terrorism" is like America's "War on Drugs". It has no end. There will always be drugs. There will always be terrorists. To start a war that has no end is very George Orwellian and reminds us that governments are not our friends. They are power mad crazies who will use any excuse to aggrandize power to themselves and ever more tightly circumscribe out lives to turn us into mindless robots "in service to the nation". Nuts!

Al Qaeda was a "police action". If Clinton had had the guts to do the right thing in the late 1990s Bin Laden would have been dead and there would have been no 9/11. If Bush had had the guts to do the right thing and put American boots on the ground in Afghanistan in 2001 they could have killed Bin Laden in the mountains of Tora Bora. One good thing I can say: Obama has the guts to use special ops to get the job done. He has taken out a fair amount of Al Qaeda leadership. Good for him. But Obama is no friend of liberty. He has clamped down on whistle-blowers. He has extended the hopeless "war" in Afghanistan. He has kept the torturers going in Guantanamo. He only meekly supported the Arab Spring.

Update... and here is more by Cory Doctorow on BoingBoing about the German government ignoring its own laws to spy on its citizens and insert malware that makes their computers vulnerable to attack by anybody.

Chaos Computer Club cracks Germany's illegal government malware, a trojan that spies on your PC and lets anyone off the street hijack it

By Cory Doctorow at 10:11 pm Monday, Oct 10

Germany's Chaos Computer Club published the sourcecode for a piece of malware used by the German government to spy on citizens. The software was discovered in the wild and reverse engineered. It can be used to spy on or control remote PCs. Because of flaws in the software, anyone who was infected with this by German police was vulnerable to spying by "anyone on the street." The German supreme court banned the use of trojans to spy on German citizens in 2008.

The analysis also revealed serious security holes that the trojan is tearing into infected systems. The screenshots and audio files it sends out are encrypted in an incompetent way, the commands from the control software to the trojan are even completely unencrypted. Neither the commands to the trojan nor its replies are authenticated or have their integrity protected. Not only can unauthorized third parties assume control of the infected system, but even attackers of mediocre skill level can connect to the authorities, claim to be a specific instance of the trojan, and upload fake data. It is even conceivable that the law enforcement agencies's IT infrastructure could be attacked through this channel. The CCC has not yet performed a penetration test on the server side of the trojan infrastructure.

"We were surprised and shocked by the lack of even elementary security in the code. Any attacker could assume control of a computer infiltrated by the German law enforcement authorities", commented a speaker of the CCC. "The security level this trojan leaves the infected systems in is comparable to it setting all passwords to '1234'".

To avoid revealing the location of the command and control server, all data is redirected through a rented dedicated server in a data center in the USA. The control of this malware is only partially within the borders of its jurisdiction. The instrument could therefore violate the fundamental principle of national sovereignty. Considering the incompetent encryption and the missing digital signatures on the command channel, this poses an unacceptable and incalculable risk. It also poses the question how a citizen is supposed to get their right of legal redress in the case the wiretapping data get lost outside Germany, or the command channel is misused.

Electronic Surveillance Scandal Hits Germany [spiegel.de]

Go read the original post to get the embedded links.

I love anything by Cory Doctorow. He is a smart dude and he is concerned about issues that are close to my heart: intellectual property rights, human rights, technology. I confess I've only read a couple of his fiction pieces. I know that's his "day job". But I love the hobbyist Doctorow more than the career Doctorow.

Economic Crimes and Government Corruption

This graph from the NY Times nicely sums up what it means to have a government that covers up banking fraud: the bottom 90% pay the price...

Click to Enlarge

Here is what Obama has not faced up to and the real reason why Occupy Wall Street protests are spreading across the US: Real household income has fallen by about 10 percent since the start of the last recession, with a greater decline after the recession ended.

If you read Ron Suskind's book Confidence Men: Wall Street, Washington, and The Education of A President, then you will understand why this banking crisis continues to grow as a metastasizing cancer. The Republicans and Bush laid the groundwork that led to the explosion of corporate crime. But Obama sits in the pocket of Wall Street lobbyists and has done nothing to cauterize the wound and help America recover.

You might do a little reading here, and here and here and here.

Dominic Streatfeild's "A History of the World Since 9/11"

This is an excellent history of our times. I expected a typical history of events, leaders, and themes. But instead this author presents 8 chapters which introduce a policy stance then burrows down to look at a small handful of "ordinary" people affected by the policy. The author's intent is to lay bare just how badly wrong the "war on terror" has gone. Here is a nice summary of the author's view from the Epilogue:

Outspoken liberals like to display their hatred of the lead players behind the War on Terror. Bush, Cheney, Rumsfeld, Blair: the villains of the piece. The truth is that, with a few notable exceptions, nobody covered themselves with glory. Opposition political parties failed to intervene; the military failed to stand behind its beliefs that operations in Iraq and Afghanistan required better resourcing, manpower and planning; the intelligence community failed to insist that caveats in the products were there for a reason. The media failed to inform the public there were serious problems. Perhaps the blame should be shared? There's enough to go round.

Doubtless there is a case to be made that the world changed as a result of 9/11. But how it changed was not up to Bin Laden, al-Qaeda or the Taliban. It was up to us. We could have reacted differently. We didn't.

As a result, the situation in which we currently find ourselves is not one that has been thrust upon us. It's one that we have chosen. Al-Qaeda doesn't threaten our existence. It never did. Our reaction to it just might.

The book has some wonderfuly graphic stories of individuals and the very real effects of 9/11 on them:

• Chapter 1 looks at Bush's dictum that "the rules have changed" and that "we must take the war to them" and that pre-emptive war was necessary. It ties this with a crazy criminal character in Texas who goes unhinged after seeing the towers fall on 9/11 and decides to go after "the enemy". For him this is anybody ethnically Middle Easternish and he ends up killing an innocent immigrant from India, a Hindu. Streatfeild lays out these characters in great detail. The hard struggle by the Hindu to build a life in America and provide a business built on serving his customers. A very nice guy who worked hard but ended up killed by a madman lashing out at "enemies" to pre-empt their attack on his beloved America. A madman with a criminal past and a mind twisted by drug abuse and violence. Tragic.


• Chapter 2 looks at the "gloves are off" and "the rules have changed. It focuses on a family fleeing Iraq prior to 9/11 but who get caught at sea in the immediate aftermath of 9/11 and harshly interned by Australia. The Australians tried to turn away the boat but the desperate immigrants tried everything to prevent being turned away. The brutal treatment left many deeply injured, some insane, from the years spent in limbo under vicious treatment by an anti-refugee policy by Australia. Tragic.


• Chapter 3 looks at the idea that the "war on terror" had to be fought viciously and that all deaths were the fault of al Qaeda and not of those in the West responding to having been attacked. This chapter looks at the excited and joyous planning of a wedding in Afghanistan. Unfortunately this was in the home province of Mullah Omar and the Americans with their "too little boots on the ground" incompetent intelligence decide that Mullah Omar will show up at the wedding. So they unleash the hell fire of US weapons on innocent people 48 were killed and 117 wounded. This disturbing story is only one of many, many in Afghanistan over a decade of "mistakes" by Americans in their war against a nearly invisible enemy.


• Chapter 8 looks at the "unintended consequences" of a war. In this case, it focuses on the world-wide program to eradicate polio. This program was within a year or two or three of success when 9/11 happened. Sadly, it now appears the world has utterly failed to eradicate polio and since there is now billions with no experience with the disease and many hundreds of millions of children with no immunity, the disease is poised to strike back worse than it was during the height of the great polio epidemics of the mid-20th century. This chapter focuses on the tale of a very dedicated, wonderful doctor who struggles to complete the fight against polio in the tribal areas of Pakistan. Sadly, the Muslims come to believe that the vaccine is a Western plot to sterilize them and that the drugs given to them are adulterated with female hormones and pig fat, they refuse the vaccine. Worse, they blow up the car in which the vaccine team is traveling and kill several including this doctor. Another tragic "consequence" of the war.

The other chapters focus on big policy themes and make them real by looking at the level of individual lives. It is all very tragic. But it makes this book especially powerful and poignant. Wars have consequences. How you fight them is very important. Sadly, the Bush administration was cavalier (cowboyish?) in its conduct of a war that has now killed hundreds and soon thousands more than were ever killed on 9/11.

One final quote from the book to hammer home the obscenities that have come out of "the war on terrorism":

Meanwhile, most of these nations seized on the exceptional nature of the post-9/11 threat, then used it as a justification for enacting domestic legislation that aped US policy regarding human rights: restrictions of rights for foreigners and asylum seekers; indefinite incarceration of suspects without trial; withdrawal of the right to an attorney; suspension of habeas corpus; enhanced surveillance techniques. The list went on and on.

'I do not underestimate the ability of fanatical groups to kill and destroy,' conceded Lord Hoffmann in a famous judgement on the incarceration of terror suspects without trial in the United Kingdom in December 2004. 'But they do not threaten the life of the nation.' The real threat to the United Kingdom, he warned, 'comes not from terrorism but from laws such as these.'

Five years later, the Human Rights Council's Eminent Panel of Jurists on Terrorism, Counter-Terrorism and Human Rights agreed. After an exhaustive three-year study of the effects of the War on Terror on human rights globally, the Panel concluded that human rights protections, assembled over the last sixty years, had been corroded to the point where the international legal order was in jeopardy. Especially worrying was that the nations that had previously argued for the primacy of human rights were the very same nations now busily opting out of them. The result was 'perhaps one of the most serious challenges ever posed to the integrity of a system carefully constructed after the Second World War.'

Everybody should read this book. It will make them sit up and pay attention to the "war" that has been conducted "on their behalf". It will change their way of viewing the world.

Transparency in Government

You can count on politicians, right and left, to promise "transparency" and deliver lies, obfuscation, and misdirection. But here's an example of how the Republicans go that "extra mile"...

Here's an interesting bit from a post on the Washington's Blog:

The Co-Chair of the Congressional Inquiry into 9/11 and former Head of the Senate Intelligence Committee, Bob Graham, previously stated that an FBI informant had hosted and rented a room to two hijackers in 2000 and that, when the Inquiry sought to interview the informant, the FBI refused outright, and then hid him in an unknown location, and that a high-level FBI official stated these blocking maneuvers were undertaken under orders from the White House (confirmed here).

The link is to this NY Times article:

Senator Accuses Bush of Cover-Up

Senator Bob Graham, the Florida Democrat who is a former chairman of the Senate Intelligence Committee, accused the White House on Tuesday of covering up evidence that might have linked Saudi Arabia to the Sept. 11 hijackers.

Mr. Graham made the accusation in a new book and repeated it at a news conference Tuesday arranged by Senator John Kerry's presidential campaign. Republicans called the accusations "bizarre conspiracy theories," and the Saudis said they were unsubstantiated and reckless.

The accusation stems from the Federal Bureau of Investigation's refusal to allow investigators for a Congressional inquiry and the independent Sept. 11 commission to interview an informant, Abdussattar Shaikh, who had been the landlord in San Diego of two Sept. 11 hijackers.

In his book "Intelligence Matters," Mr. Graham, the co-chairman of the Congressional inquiry with Representative Porter J. Goss, Republican of Florida, said an F.B.I. official wrote them in November 2002 and said "the administration would not sanction a staff interview with the source.'' On Tuesday, Mr. Graham called the letter "a smoking gun" and said, "The reason for this cover-up goes right to the White House."

The report added to suspicions about a Saudi role in the hijacking plot.

As I read the above, I keep hearing that voice from the Watergate scandal: follow the money.

Go read the whole Washington's Blog post to find links to many, many other comments on this ugly cover-up of terrorists by the Bush administration.

Corruption in Government

There is an excellent article by Yves Smith in her Naked Capitalism blog. Here is the juiciest tidbit to whet your appetite:

What is disturbing about the Wall Street Journal is the moral blindness of too many of the key actors, namely Friedman himself and some Fed officials. Let’s parse some of the key bits of the Wall Street Journal story:

The Federal Reserve Bank of New York shaped Washington’s response to the financial crisis late last year, which buoyed Goldman Sachs Group Inc. and other Wall Street firms. Goldman received speedy approval to become a bank holding company in September and a $10 billion capital injection soon after.

... he latest news tidbit, of former Goldman co-chairman Steven Friedman staying on as chairman of the New York Fed after Goldman became a bank holding company, isn’t as troubling as when current Goldman chief Lloyd Blankfein was the only Wall Street denizen to meet with Hank Paulson when the Treasury was deciding what to do about AIG. Readers may recall that Goldman had the biggest exposure to AIG and thus had the most to benefit from a course of action that would be generous to counterparties (who had chosen of their own cognizance to enter into contracts with the big insurer).

During that time, the New York Fed’s chairman, Stephen Friedman, sat on Goldman’s board and had a large holding in Goldman stock, which because of Goldman’s new status as a bank holding company was a violation of Federal Reserve policy.

The New York Fed asked for a waiver, which, after about 2½ months, the Fed granted. While it was weighing the request, Mr. Friedman bought 37,300 more Goldman shares in December. They’ve since risen $1.7 million in value.

Get that? The guy in charge of "saving Wall Street", the head of the NY Federal Reserve, gets to decide to save Goldman Sachs (and thereby save the value of his shares in that company), and once he sets them up as a bank holding company and gives them an infusion of $10 billion of taxpayer money, he decides they look like "a good investment" so he buys more shares... of the very bank he is supposed to "regulate".

That's letting the fox look after the hens in the hen house because he is best situated to know which is the tenderest, plumpest, and more desirable. Willie Sutton would have given up his career as a bank robber if he could have gotten himself named as a bank director!

Go read the whole article.

Thank God America has Obama on the job to bless this bit of self-serving double-dealing. We wouldn't want America to descend into "crony capitalism" like Asia in 1997 when the US and the IMF all chided Asian countries over their "corruption".

Sadly, I expected crony capitalism from George Bush and the Republicans. I'm surprised by Obama's eager embrace of Wall Street and all that lobbyist money to fund his 2012 re-election. Thank God Obama is incorruptible and has shown himself to jump in and nip corruption in the bud by turning a blind eye to these Federal Reserve shenanigans, by watering down the Dodd-Frank bill, and showing great reluctance to attend the $100,000 a plate celebratory dinners that Wall Street has thrown in celebration of finally have a tough "regulator" in the White House.

Krugman Bad Mouths Obama

Paul Krugman has lost all faith in Obama to do the economically sensible thing or to show any semblance of political leadership. From his blog at the NY Times:

I’ve actually been avoiding thinking about the latest Obama cave-in, on ozone regulation; these repeated retreats are getting painful to watch. For what it’s worth, I think it’s bad politics. The Obama political people seem to think that their route to victory is to avoid doing anything that the GOP might attack — but the GOP will call Obama a socialist job-killer no matter what they do. Meanwhile, they just keep reinforcing the perception of mush from the wimp, of a president who doesn’t stand for anything.

Whatever. Let’s talk about the economics. Because the ozone decision is definitely a mistake on that front.

As some of us keep trying to point out, the United States is in a liquidity trap: private spending is inadequate to achieve full employment, and with short-term interest rates close to zero, conventional monetary policy is exhausted.

Click to Enlarge
This puts us in a world of topsy-turvy, in which many of the usual rules of economics cease to hold. Thrift leads to lower investment; wage cuts reduce employment; even higher productivity can be a bad thing. And the broken windows fallacy ceases to be a fallacy: something that forces firms to replace capital, even if that something seemingly makes them poorer, can stimulate spending and raise employment. Indeed, in the absence of effective policy, that’s how recovery eventually happens: as Keynes put it, a slump goes on until “the shortage of capital through use, decay and obsolescence” gets firms spending again to replace their plant and equipment.

And now you can see why tighter ozone regulation would actually have created jobs: it would have forced firms to spend on upgrading or replacing equipment, helping to boost demand. Yes, it would have cost money — but that’s the point! And with corporations sitting on lots of idle cash, the money spent would not, to any significant extent, come at the expense of other investment.

More broadly, if you’re going to do environmental investments — things that are worth doing even in flush times — it’s hard to think of a better time to do them than when the resources needed to make those investments would otherwise have been idle.

So, a lousy decision all around. Are you surprised?

It is amazing to me that back in 2008 when America elected Obama there were such high hopes. I had read his books. I liked the arc of his career. He was obviously intelligent. He seemed to have a deft political touch. He claimed to be a real fan of Abraham Lincoln and saw himself as coming to play a Lincoln-esque role in a deeply divided country. It sounded so very good.

Then he took office and he failed to carry through on promises. Lots of little things left his partisans puzzled. He seemed oddly passive in the face of great problems. He seemed obsessive about "reaching out" to Republicans while ignoring his base. He "led" by following. He left to Congress the task of framing the great programs that would save the country. He frittered away time. He was unresponsive to the great suffering in the land. Amazing.

I, like Krugman, have reached the end of my rope. I expect nothing good out of Obama. I really would like to see the Democrats nominate somebody else to run 2012. He will be a disaster if he wins in 2012. He won't be as great a disaster as a Republican victor, but he will be a disaster. I'm not sure America can survive with another 4 years of Obama. That will have been 8 disastrous years under Bush and 8 frittered away, rudderless, falling short years under Obama. I'm not sure the country has the remaining internal resources to wait out this string of bad presidencies until 2016.

Here is Brad DeLong's disillusionment with Obama:

I remember being told that in January 2001 Larry Lindsey had showed up at the Council of Economic Advisers' office in the Eisenhower Executive Office Building and said "Well, the people who understand economics are back in charge!", and at the time I thought that Larry's belief that George W. Bush and his administration in any sense "understood" economics was the most pathetic and self-delusional thing that I had heard. But now I think of my confidence in December 2008 and January 2009 that the Obama administration understood that you needed not economic policies that sounded good and polled good but economic policies that actually worked, and I wince.

Go read the full post to get specifics of his disillusionment with regard to Obama's fixation on austerity.

The American Economic Mess in a Nutshell

Robert Reich sums up the problem facing the US:

Since this Depression began at the end of 2007, America’s potential labor force – working-age people who want jobs – has grown by over 7 million. But since then the number of Americans with jobs has shrunk by more than 300,000.

If this doesn’t prompt President Obama to unveil a bold jobs plan next Thursday, I don’t know what will.

The problem is on the demand side. Consumers (whose spending is 70 percent of the economy) can’t boost the economy on their own. They’re still too burdened by debt, especially on homes that are worth less than their mortgages. Their jobs are disappearinig, their pay is dropping, their medical bills are soaring.

And businesses won’t hire without more sales.

So we’re in a vicous cycle.

Nearly 3 years have been wasted without taking the fact that the US is in a serious depression. Obama is fiddling while Rome burns. The Republicans are spitting in the eye of America with their fantasy story that more Bush tax cuts and deregulation will raise the economy from the dead. The George Bush years were the worst for job creation since WWII. Even Jimmy Carter in 4 years created more jobs during the 1970s stagflation that George Bush did in 8 years of his "deregulate, deregulate, deregulate" and "shrink the government".

I wish Obama would listen to Robert Reich:

So why don’t Republicans get it? Either they’re knaves – they want the economy to stay awful through next Election Day so Obama gets the boot. Or they’re fools – they’ve bought the lie that reducing the deficit now creates more jobs.

Every time you hear anyone say we’re “broke” or “can’t afford to spend more,” tell them we’ll be in worse shape if we don’t. If the economy remains dead in the water, the ratio of public debt to GDP balloons.

And remind them that the federal government can now borrow at fire-sale rates. Interest on the ten-year Treasury bill is 2 percent.

Do you hear me, Mr. President? Please — be bold next week. And if, as expected, Republicans refuse to go along, take it to the people. Mobilize the public. Use the bully pulpit. That’s what you have it for.

Republican Mismanagement of the US Economy

What I find ludicrous is how the Republicans want to lecture the Democrats and Obama about "economics" and "budgets" and "deficits and debts".

Here is a bit from an article by Nobel prize-winning economist Joseph Stiglitz in Project Syndicate:

Even if Bush could be forgiven for taking America, and much of the rest of the world, to war on false pretenses, and for misrepresenting the cost of the venture, there is no excuse for how he chose to finance it. His was the first war in history paid for entirely on credit. As America went into battle, with deficits already soaring from his 2001 tax cut, Bush decided to plunge ahead with yet another round of tax “relief” for the wealthy.

Today, America is focused on unemployment and the deficit. Both threats to America’s future can, in no small measure, be traced to the wars in Afghanistan and Iraq. Increased defense spending, together with the Bush tax cuts, is a key reason why America went from a fiscal surplus of 2% of GDP when Bush was elected to its parlous deficit and debt position today. Direct government spending on those wars so far amounts to roughly $2 trillion – $17,000 for every US household – with bills yet to be received increasing this amount by more than 50%.

So how big is "the tab" that Bush and the Republicans have run up for their "war of choice"?

Indeed, when Linda Bilmes and I calculated America’s war costs three years ago, the conservative tally was $3-5 trillion. Since then, the costs have mounted further. With almost 50% of returning troops eligible to receive some level of disability payment, and more than 600,000 treated so far in veterans’ medical facilities, we now estimate that future disability payments and health-care costs will total $600-900 billion. But the social costs, reflected in veteran suicides (which have topped 18 per day in recent years) and family breakups, are incalculable.

Right now you've got the Republicans saying that won't add $1 billion to FEMA to help the latest victims of a natural disaster "because America is broke". Funny... nobody noticed this "broke" problem in 2001, 2002, 2003, 2004, 2005, 2006, 2007, or 2008 when Bush and the Republians were spending taxpayers money like a drunken sailor.

What I can't believe is that voters in the US continue to believe the incredible nonsense spewed by the Republicans, especially by their outrageous presidential "candidates" who show abysmal knowledge of economics, of foreign affairs, of the Constitution, of American history, of the legislative process, and the pain & hurt among the unemployed, foreclosed, the retired and soon-to-retire who have lost their life savings, and the young who face a job market that will be closed to them for a decade. These bozos claim they can "run" America. Yeah... just like Bush ran America... right into the ground.