The just-announced compromise between President Obama and gloating Republicans seems to be the final nail in the coffin of the Obama Administration. This guy, to put it simply, seems to have no stomach for a fight at all. Like some modern anti-hero, when the going gets rough, he caves. So today, as he’s been hinting all along, he announced that he would extend the Bush tax cuts for all Americans, including those making over $250,000/year or even $1 million a year (as Senator Schumer proposed.) No, Obama ate the whole poisoned meal, and tried to defend it to outraged colleagues. More than that, he added a couple of new wrinkles. First, he proposed to provide a year’s drop of 2% in the FICA or Social Security taxes that all Americans pay (progressives have proposed making wealthy Americans pay more by extending the amount of income subject to SS taxes, but Obama, predictably, went the other way). While Obama claims that this will put more money in the hands of working Americans (and it will, short term), other progressives have pointed out that it makes a start in a direction favored by the most rabid reactionaries, who have been trying to get rid of Social Security for 80 years. That is, by reducing the amount going into the Social Security Trust Fund (already raided for years by mainly Republican presidents to finance their shitty wars), the President’s action will add to the pressure to bankrupt Social Security to the point where it will be abandoned as too costly. After all, Americans need their military-industrial complex. But there’s another element to the plan as well, again a major cave-in to slavering Republicans and their millionaire constituency. The hated estate tax would be lowered, on estates worth more than $5 million, to 35%. Democrats, Obama’s party, wanted to make the tax 45% on all estates over $3.5 million (still a lowering from the 55% it had been), but again, the Republican plan won.
Sort of makes you wonder if perhaps Obama isn’t a closet Republican, doesn’t it?
Whatever he is—and it certainly is not progressive—it now seems clear that he has decided that his only hope for winning in 2012 is to follow Bill Clinton’s example, and turn to the right after a mid-tern ‘shellacking’. It is a bitter pill for progressives to swallow after the euphoria that greeted his election. It is also, unless I miss my guess, the death knell for his administration. Because the one thing Americans despise more than a loser is a president so weak he can’t even muster the courage to use his bully pulpit to fight for what he believes in. Instead, at every turn, Obama has caved in to conservative forces—whether it’s on the wars in Iraq and Afghanistan, the Health Care “reform”, or taxes on the rich. Perhaps he long ago concluded that as a black man, he had to present himself as a non-threatening, non-combative intellectual. But he’s done that, and it has backfired every time. According to Republican rhetoric, he’s a socialist, a communist, a Muslim and a Nazi all rolled into one. Why he thinks he can somehow ingratiate himself with them and their constituency now is a mystery no one seems able to solve. The only thing that appears certain to me, again, is that it—plus his continuing cowardice in confronting his enemies—will condemn him to one term. Given the lack of backbone he’s displayed thus far (and sadly, he has tons of company among his Democratic comrades in Congress), perhaps that’s a good thing.
Lawrence DiStasi
Tuesday, December 7, 2010
Wednesday, December 1, 2010
Wikileaks: An Inside Job?
The news has been alive with alarms about the catastrophe that could result from the latest Wikileaks revelations—over 250,000 cables from the U.S. State Department that could compromise U.S. diplomacy and diplomatic relations for years. Hilary Clinton expressed grave concern about the damage not only to the United States but to the world. The Justice Department announced it would be doing all in its power to prosecute those responsible—chiefly, it seems, Private Bradley Manning, now in custody as the lead, and only suspect in the investigation.
But the real hysteria has centered on those two remaining members of the ‘Axis of Evil,’ Iran and North Korea. Of course, it’s understandable that pooh bahs would be alarmed about North Korea, what with its two recent attacks on the South ratcheting up fears of a renewed all-out war (hard to believe that there has never really been an end to the 1950s Korea “conflict,” isn’t it). Still, the major alarums and trial balloons have concerned Iran. In England’s Guardian, the Nov. 28 headline read: “Saudi Arabia urges US attack on Iran to Stop Nuclear Programme.” The very first sentence adds that “other Arab allies have agitated for military action against Tehran.” These “other allies” include such democratic stalwarts as Jordan, Bahrain, the United Arab Emirates, and Egypt. All see Iran as a “threat”, as “evil,” or as a “snake.” “Cut off the head of the snake,” Saudi King Abdullah is quoted as urging.
All this was, of course, real music to the Israelis. As prime minister Binyamin Netanyahu was quoted by the Washington Post on Monday Nov. 29, "More and more states, governments and leaders in the Middle East and the wider region and the world believe this is the fundamental threat." Netanyahu went on to expose what he called the “gap” between what Arab leaders say privately and publicly, their public “script” alleging that the “greatest threat is the Israeli-Palestinian conflict,” while “in reality, leaders understand that this narrative is bankrupt. There is a new understanding,” i.e. the malignancy of a nuclear Iran.
And of course, the American media ran with this as the major story of the Wikileaks revelations. Both the PBS News Hour, with its pundits seriously discussing how bad the Iranian situation is, how unstable its leader, how worried the Arab states are about threats to their own regimes from a rising Iran; and Charlie Rose, where other pundits reviewed the “real” threat of a nuclear Iran (still, by the way, without even a hint of a nuclear weapon, though that no longer matters to the alarmists), and the “consensus” in the Arab states about this (the consensus of the Arab monarchies, at least, most of whom quietly sided with Israel against the Palestinians in the original war in 1948; though Hosni Mubarak of Egypt only jumped on the “throw Palestine to the wolves” bandwagon much later, to maintain U.S. aid and save his dictatorial ass increasingly threatened by popular revolt); in both arenas the ‘experts’ shook their heads gravely as they observed that the time is getting short for someone—Israel or the Obama administration—to do something. And the something was clear to all: someone has to bomb Iran’s still peaceful nuclear facilities.
It was amazing really. Out of 250,000 cables released or soon to be released, the big story was Iran: bomb bomb bomb Iran. No wonder Ahmedinejad, Iran’s president, scornfully dismissed the leaks as U.S. propaganda. But even that was taken as a sign that the man is as totally divorced from reality as his unstable nation.
Until, that is, on November 30, we heard from Col. Lawrence Wilkerson, the chief of staff to George W. Bush’s first Secretary of State, Colin Powell. Speaking on KPFA’s “Letters to Washington” show, Wilkerson had some fascinating things to say about Wikileak’s latest revelations. First, he said that all the worry about the leaks threatening U.S. diplomatic relations was a “tempest in a teapot.” Diplomats, according to Wilkerson, know that harsh words often get said in private, that governments all try to spy on each other, and that everyone understands the game. What he was really concerned about, he said, was the lack of capability, not to mention supervision of the alleged leaker, Pvt. Bradley Manning. “I have serious difficulty,” the Colonel said, “accepting the fact that this private downloaded what appears to be over a million documents and then gave them to others…Where was his chain of command when he was doing this? when he was downloading thousands of documents?” And then the Colonel came to the real nub of it:
Remember: this is not some ‘expert’ who may or may not have a private agenda with regard to the leaks or the substance of the leaks; nor, as he says, a conspiracy theorist. This is an army colonel, former chief of staff to the previous Secretary of State. This is a man who knows how Washington works, how diplomacy works, how the world of statecraft works. And his chief concern is not the alleged “damage” to the nation’s diplomacy posed by the leaks; it is the twin questions: 1) how did the United States allow this to happen? and 2) was someone taking the opportunity (either by leaping on what was leaked, or actually facilitating the leaks in the first place) to plant disinformation to affirm things they want affirmed?
And what do they want to affirm? It appears that the main objective is to provide further ammunition undergirding the administration’s—driven mainly by Israel and its U.S. lobbies—position that Iran constitutes the greatest threat to world peace since the Soviets, and the increasing justification for a military mission to take that threat out. As Zeid Rifai, the president of the Jordanian senate is quoted as telling a US official: “Bomb Iran, or live with an Iranian bomb. Sanctions, carrots, incentives won’t matter.” Or, as Major General Amos Yadlin, Israel’s military intelligence chief, warned last year: “Israel is not in a position to underestimate Iran and be surprised like the US was on 11 September 2001.”
I have to admit, it never crossed my mind that the Wikileaks cables could be part of a disinformation campaign. Perhaps it takes someone with inside knowledge of how such things work, like Colonel Wilkerson, to get it. But there it is. And my guess is that increasingly, especially as Obama is further harried by Republican zealots howling for his head, the refrain is going to get louder: Bomb Iran now, or suffer another 9/11.
Will the American public go for it? Normally I’d say no. But given what they’ve swallowed recently, and given the fear in this nation, can anyone be sure?
Lawrence DiStasi
But the real hysteria has centered on those two remaining members of the ‘Axis of Evil,’ Iran and North Korea. Of course, it’s understandable that pooh bahs would be alarmed about North Korea, what with its two recent attacks on the South ratcheting up fears of a renewed all-out war (hard to believe that there has never really been an end to the 1950s Korea “conflict,” isn’t it). Still, the major alarums and trial balloons have concerned Iran. In England’s Guardian, the Nov. 28 headline read: “Saudi Arabia urges US attack on Iran to Stop Nuclear Programme.” The very first sentence adds that “other Arab allies have agitated for military action against Tehran.” These “other allies” include such democratic stalwarts as Jordan, Bahrain, the United Arab Emirates, and Egypt. All see Iran as a “threat”, as “evil,” or as a “snake.” “Cut off the head of the snake,” Saudi King Abdullah is quoted as urging.
All this was, of course, real music to the Israelis. As prime minister Binyamin Netanyahu was quoted by the Washington Post on Monday Nov. 29, "More and more states, governments and leaders in the Middle East and the wider region and the world believe this is the fundamental threat." Netanyahu went on to expose what he called the “gap” between what Arab leaders say privately and publicly, their public “script” alleging that the “greatest threat is the Israeli-Palestinian conflict,” while “in reality, leaders understand that this narrative is bankrupt. There is a new understanding,” i.e. the malignancy of a nuclear Iran.
And of course, the American media ran with this as the major story of the Wikileaks revelations. Both the PBS News Hour, with its pundits seriously discussing how bad the Iranian situation is, how unstable its leader, how worried the Arab states are about threats to their own regimes from a rising Iran; and Charlie Rose, where other pundits reviewed the “real” threat of a nuclear Iran (still, by the way, without even a hint of a nuclear weapon, though that no longer matters to the alarmists), and the “consensus” in the Arab states about this (the consensus of the Arab monarchies, at least, most of whom quietly sided with Israel against the Palestinians in the original war in 1948; though Hosni Mubarak of Egypt only jumped on the “throw Palestine to the wolves” bandwagon much later, to maintain U.S. aid and save his dictatorial ass increasingly threatened by popular revolt); in both arenas the ‘experts’ shook their heads gravely as they observed that the time is getting short for someone—Israel or the Obama administration—to do something. And the something was clear to all: someone has to bomb Iran’s still peaceful nuclear facilities.
It was amazing really. Out of 250,000 cables released or soon to be released, the big story was Iran: bomb bomb bomb Iran. No wonder Ahmedinejad, Iran’s president, scornfully dismissed the leaks as U.S. propaganda. But even that was taken as a sign that the man is as totally divorced from reality as his unstable nation.
Until, that is, on November 30, we heard from Col. Lawrence Wilkerson, the chief of staff to George W. Bush’s first Secretary of State, Colin Powell. Speaking on KPFA’s “Letters to Washington” show, Wilkerson had some fascinating things to say about Wikileak’s latest revelations. First, he said that all the worry about the leaks threatening U.S. diplomatic relations was a “tempest in a teapot.” Diplomats, according to Wilkerson, know that harsh words often get said in private, that governments all try to spy on each other, and that everyone understands the game. What he was really concerned about, he said, was the lack of capability, not to mention supervision of the alleged leaker, Pvt. Bradley Manning. “I have serious difficulty,” the Colonel said, “accepting the fact that this private downloaded what appears to be over a million documents and then gave them to others…Where was his chain of command when he was doing this? when he was downloading thousands of documents?” And then the Colonel came to the real nub of it:
This looks increasingly like (and I’m not a conspiracy theorist) someone is either jumping on top of this, opportunistically, to take advantage of it, or perhaps they were involved in it all along. And why is the information contained in these latest leaks in particular so proof positive of so many things that the United States, or certain parts of the United States, are trying to get across to the public—not least of which is Israel’s threatened position, that an existential threat exists to Israel and Iran is that threat. ‘Look how perilous, look how dangerous this situation is.’ That comes out of these leaks. (emphasis added)
Remember: this is not some ‘expert’ who may or may not have a private agenda with regard to the leaks or the substance of the leaks; nor, as he says, a conspiracy theorist. This is an army colonel, former chief of staff to the previous Secretary of State. This is a man who knows how Washington works, how diplomacy works, how the world of statecraft works. And his chief concern is not the alleged “damage” to the nation’s diplomacy posed by the leaks; it is the twin questions: 1) how did the United States allow this to happen? and 2) was someone taking the opportunity (either by leaping on what was leaked, or actually facilitating the leaks in the first place) to plant disinformation to affirm things they want affirmed?
And what do they want to affirm? It appears that the main objective is to provide further ammunition undergirding the administration’s—driven mainly by Israel and its U.S. lobbies—position that Iran constitutes the greatest threat to world peace since the Soviets, and the increasing justification for a military mission to take that threat out. As Zeid Rifai, the president of the Jordanian senate is quoted as telling a US official: “Bomb Iran, or live with an Iranian bomb. Sanctions, carrots, incentives won’t matter.” Or, as Major General Amos Yadlin, Israel’s military intelligence chief, warned last year: “Israel is not in a position to underestimate Iran and be surprised like the US was on 11 September 2001.”
I have to admit, it never crossed my mind that the Wikileaks cables could be part of a disinformation campaign. Perhaps it takes someone with inside knowledge of how such things work, like Colonel Wilkerson, to get it. But there it is. And my guess is that increasingly, especially as Obama is further harried by Republican zealots howling for his head, the refrain is going to get louder: Bomb Iran now, or suffer another 9/11.
Will the American public go for it? Normally I’d say no. But given what they’ve swallowed recently, and given the fear in this nation, can anyone be sure?
Lawrence DiStasi
Monday, November 29, 2010
Social Security Scapegoat
It’s time for the American public to blow a big hole in the proposals now being seriously considered to “solve the budget crisis.” As noted in my last blog, the onus, as always, is meant to fall on the poorest among us. We have been hearing ad nauseam the mantra that the Social Security system is driving the nation into insolvency. Therefore, recent proposals to “solve” the debt crisis—brought on, it should be remembered, by two unpaid-for and unnecessary wars, the Reagan-Bush-Bush reductions in tax income on the wealthy, and of course the outright thievery of Wall Street financiers that produced the housing bubble, and crash—always target Social Security. ‘We’ll all have to make sacrifices,’ is the song line. Which means, you, you poor gullible assholes, will have to sacrifice as usual.
Unless, that is, everyone remembers some simple facts, the first of which is: Social Security is NOT responsible in any way for the current deficits. Indeed, Social Security right now runs surpluses—that is, the money paid in, by workers themselves—outstrips the money paid out. And remember, it’s your money you’ve been paying in for a lifetime. You may recall, in fact, the campaign promises of our presidential candidates a few years ago, who promised that Social Security funds would be “put in a lock box.” What that referred to is the fact that right now, according to the National Committee to Preserve Social Security and Medicare (www.ncpssm.org), there is a “$2.6 trillion dollar trust fund built up by American workers over decades.” That’s $2.6 trillion folks. Except for the fact that the federal government, to disguise the deficit it runs each time we have a war, borrows from the SS trust fund, and is thereby obligated to pay it back, with interest. This raiding of the Trust Fund started in 1968 when Pres. Lyndon Johnson got legislation passed—he was building up American involvement in the Vietnam War, and of course wanted to tout “both guns and butter” (their guns, our butter)—started the game. The Trust Fund was allowed to be mixed with the General Fund, and off we went.
Bottom line: not only does Social Security run a surplus, the Federal Government owes the Social Security Trust Fund a ton of money, which it has to pay back with interest. It is in this sense only that Social Security could be said—by a blatant liar—to be contributing to the deficit. A more honest assessment would admit that, in fact, Social Security has contributed to the government’s solvency by supplying it with unused SS funds (the surplus) to disguise its deficits. Is the government grateful? Are the fiscal hawks grateful? Au contraire, mon ami. These bastards resent having to pay all that money back. It will break us! they whine. So let’s kill the goose that lays the golden eggs!
Sounds unbelievable, but that is the proposal coming out of such august bodies as the President’s Commission on Reducing the Deficit, and the Domenici/Rivlin plan referred to in a previous post. Let’s raise the retirement age, cut the COLAs (cost of living adjustments), force seniors to pay more for prescription drugs, and find other ways to cut benefits to the poorest among us. The key thing is to help business! Domenici/Rivlin, in fact, propose giving businesses a one-year Social Security tax “holiday” (we all love holidays, right?) that would reduce government income by $650 billion. It’s not enough that the money-grubbing swine who drove us into this ditch have all been bailed out—with government funds, some of which no doubt came from that SS Trust Fund. Now we have to give them another “holiday” while cutting the pathetic benefits given to the old folks. I tell you, if the American people fall for this one, they deserve to be rooting around in garbage bins to survive.
Fortunately, the National Committee to Preserve Social Security and Medicare has organized a day of protest. The Committee is calling on all interested parties (and if there’s someone who plans on not getting older, I’d like to hear from him/her) to take part in a day (Tuesday, Nov. 30) of calling Congress and making two demands: 1) NO cuts to Social Security for deficit reduction, and 2) a $250 payment this year to SS beneficiaries in lieu of no cost-of-living increases (COLAs) the past two years. Here’s the number of a hot line that will connect you to your Congressperson’s office: 800-998-0180. CALL, because you can be sure the other side will be shouting their ears off.
While you’re at it, you might want to cast a vote of support for Representative Jan Schakowsky’s plan for deficit reduction. Shakowsky is the only people’s representative on the Budget Deficit Commission, and her plan amounts to getting some budget reductions by such unheard-of expedients as “$144.6 billion in tax increases, $110.7 billion in defense cuts and $17.2 billion in healthcare savings through a public option.” And definitely no cuts in Social Security. As the Huffington Post quoted Shakowsky re: the Bowles-Simpson proposal to cut SS benefits: Using Social Security to address the deficit “is like attacking Iraq to retaliate for the September 11 attacks.”
Of course there are legions of benighted souls in America who would respond: what’s wrong with that? But perhaps there are other legions who get the point. Let us hope so; because as it stands now, the greatest push seems to be coming from the yahoos, who clearly see the current series of shocks (remember the Shock Doctrine?) as their best opportunity to, once and for all, get rid of the most hated of Roosevelt’s “giveaways”: Social Security.
Lawrence DiStasi
Unless, that is, everyone remembers some simple facts, the first of which is: Social Security is NOT responsible in any way for the current deficits. Indeed, Social Security right now runs surpluses—that is, the money paid in, by workers themselves—outstrips the money paid out. And remember, it’s your money you’ve been paying in for a lifetime. You may recall, in fact, the campaign promises of our presidential candidates a few years ago, who promised that Social Security funds would be “put in a lock box.” What that referred to is the fact that right now, according to the National Committee to Preserve Social Security and Medicare (www.ncpssm.org), there is a “$2.6 trillion dollar trust fund built up by American workers over decades.” That’s $2.6 trillion folks. Except for the fact that the federal government, to disguise the deficit it runs each time we have a war, borrows from the SS trust fund, and is thereby obligated to pay it back, with interest. This raiding of the Trust Fund started in 1968 when Pres. Lyndon Johnson got legislation passed—he was building up American involvement in the Vietnam War, and of course wanted to tout “both guns and butter” (their guns, our butter)—started the game. The Trust Fund was allowed to be mixed with the General Fund, and off we went.
Bottom line: not only does Social Security run a surplus, the Federal Government owes the Social Security Trust Fund a ton of money, which it has to pay back with interest. It is in this sense only that Social Security could be said—by a blatant liar—to be contributing to the deficit. A more honest assessment would admit that, in fact, Social Security has contributed to the government’s solvency by supplying it with unused SS funds (the surplus) to disguise its deficits. Is the government grateful? Are the fiscal hawks grateful? Au contraire, mon ami. These bastards resent having to pay all that money back. It will break us! they whine. So let’s kill the goose that lays the golden eggs!
Sounds unbelievable, but that is the proposal coming out of such august bodies as the President’s Commission on Reducing the Deficit, and the Domenici/Rivlin plan referred to in a previous post. Let’s raise the retirement age, cut the COLAs (cost of living adjustments), force seniors to pay more for prescription drugs, and find other ways to cut benefits to the poorest among us. The key thing is to help business! Domenici/Rivlin, in fact, propose giving businesses a one-year Social Security tax “holiday” (we all love holidays, right?) that would reduce government income by $650 billion. It’s not enough that the money-grubbing swine who drove us into this ditch have all been bailed out—with government funds, some of which no doubt came from that SS Trust Fund. Now we have to give them another “holiday” while cutting the pathetic benefits given to the old folks. I tell you, if the American people fall for this one, they deserve to be rooting around in garbage bins to survive.
Fortunately, the National Committee to Preserve Social Security and Medicare has organized a day of protest. The Committee is calling on all interested parties (and if there’s someone who plans on not getting older, I’d like to hear from him/her) to take part in a day (Tuesday, Nov. 30) of calling Congress and making two demands: 1) NO cuts to Social Security for deficit reduction, and 2) a $250 payment this year to SS beneficiaries in lieu of no cost-of-living increases (COLAs) the past two years. Here’s the number of a hot line that will connect you to your Congressperson’s office: 800-998-0180. CALL, because you can be sure the other side will be shouting their ears off.
While you’re at it, you might want to cast a vote of support for Representative Jan Schakowsky’s plan for deficit reduction. Shakowsky is the only people’s representative on the Budget Deficit Commission, and her plan amounts to getting some budget reductions by such unheard-of expedients as “$144.6 billion in tax increases, $110.7 billion in defense cuts and $17.2 billion in healthcare savings through a public option.” And definitely no cuts in Social Security. As the Huffington Post quoted Shakowsky re: the Bowles-Simpson proposal to cut SS benefits: Using Social Security to address the deficit “is like attacking Iraq to retaliate for the September 11 attacks.”
Of course there are legions of benighted souls in America who would respond: what’s wrong with that? But perhaps there are other legions who get the point. Let us hope so; because as it stands now, the greatest push seems to be coming from the yahoos, who clearly see the current series of shocks (remember the Shock Doctrine?) as their best opportunity to, once and for all, get rid of the most hated of Roosevelt’s “giveaways”: Social Security.
Lawrence DiStasi
Friday, November 19, 2010
Destroying the Working Classes
It has become Republican party policy to scream “class warfare” any time Democrats try to blame the rich for our current economic troubles. This is supposed to embarrass those who, according to the code of our time, are reviving socialistic or communistic dogma. The truth, though, is that the wealthy in this country—aided and abetted by the last three Republican administrations (and often enough by Democratic ones as well)—have been waging class warfare since at least the Reagan administration, have succeeded beyond anything they could have imagined, and are still not satisfied. They apparently want to reduce most of us to literal peonage. And the response? Well just think about the difference in the silence here, compared to near-riots in Europe—where Greek and French workers have had massive strikes and taken to the streets to condemn their governments’ proposals to reduce benefits won over years of struggle. Americans, by contrast, simply sit back and take it, or worse, ally themselves with the very people who have done them in.
Consider some facts assembled by Robert Freeman in a recent article (“Rich Declare War on the Middle Class,” Nov. 14, Commondreams.org). He begins with Ronald Reagan’s ‘revered’ administration, which “cut the marginal tax rate on the highest income earners from 75% to 35% while dramatically expanding spending for war.” Result: the national debt quadrupled between 1980 and 1992. But did anyone howl then? No, conservative economists kept saying, debt doesn’t matter; it’s a small percent of GDP. Both Bushes continued the trend, with W getting the prize, reducing the tax rate even more, spending trillions on war, and more than doubling the share of income to the top 1% (40% of his tax cut went to the top 1% of earners), and tripling the share to the top 1/10th of 1%. In dollars, this means that from 1973 till today, real wages for workers dropped, with adjusted income of the bottom fifth falling by about $7000/year, while yearly income for the top 1% increased by no less than $741,000. The figures for wealth held by each class are even starker: the top 1% now holds 34% of the nation’s wealth while the bottom half holds a mere 2.5%. As for the bottom two-fifths, they hold nothing, zero, zilch.
You might think, if you’re one of the working or middle classes—i.e., one of the growing numbers on food stamps (1 out of 8 Americans) or in official poverty (1 out of 5 Americans)—that perhaps this would satisfy the rich. But greed is insatiable. So now we hear from some of those alarmed individuals who have suddenly grown concerned over our national debt—particularly at the Obama adminstration providing a stimulus to create jobs for some of the 25 million unemployed, and also trying to reform the health care system to include more Americans left out of the worst system in the world—that something must be done. Our nation will go broke, they cry. We can’t sustain this kind of spending, they moan. And so we have the recommendations of the National Deficit Commission—to rip off the working classes even more. To allegedly lower the deficit by $4 billion, they propose remedies like this: eliminate the tax deduction for mortgage payments, which will decimate one of the last remaining sources of wealth for most people, their homes. They also propose to cut back the meager benefits provided by Social Security, lowering cost-of-living adjustments, raising the minimum retirement age, and while they’re at it, increasing the co-pays and deductibles for Medicare. And of course, they propose to reduce spending—which always means not cutting the military spending that’s bankrupting the country (recent govt estimates place the cost of keeping one (1) soldier in Afghanistan for a year at $1 million; that’s one soldier!), but the paltry programs that benefit the poor and the indigent.
And the monstrous benefits for the rich? Not a word about that. Or rather, those are slated to be increased! The Commission proposes to lower the maximum tax on the highest income earners from 35% to 24%, while their great buddies, the corporations, also get a drop in their nominal tax rate from 35% to 24% (those who actually pay taxes, that is.)
Amazing. But that’s not all. Into the fray, recently, has come yet another proposal from a front organization calling itself the Bipartisan Policy Center, made up of 19 prominent citizens, ex-legislators, ex-governors, and so on, chaired by retired Senator Pete Domenici of New Mexico and a former budget director, Alice Rivlin. And what do they propose to “solve” our crisis? Why yet another tax holiday, this time a suspension of the Social Security payroll tax for a year or two, cutting and simplifying individual and corporate tax rates, and, get this, instituting a new 6.5% national sales tax. That’s to make up for the huge tax losses from the tax holiday. Now anyone who knows anything about taxation knows that sales taxes (and fees for things like drivers’ licenses, etc.) are regressive: that is, because the tax on purchases constitutes a much larger percentage of disposable income for the poor and working classes than it does for the rich, its impact on the poor is orders of magnitude greater. This is the whole theory behind a graduated income tax: to help make up for the disparity in wealth (and the wealthy always consume more natural resources and public services than their poorer counterparts), the tax on those who earn more should comprise a greater percentage of their earnings. But increasingly in our “everything for the wealthy” nation, progressive taxes are seen as unfairly depriving the wealthy of their just desserts. Tax has become a dirty word—as if any nation or any community could long survive without it. And increasing taxes, why that has become the equivalent of the black plague. So we have more and more proposals for sales taxes to bail out state and local governments, as well as the federal government, from the income tax-deprived holes they’ve dug for themselves.
The question is, why would elected representatives be so inclined to ignore the poor and aid the rich (the cost of the recent bailout of banks and Wall Street has been estimated at $13 trillion, and growing)? Perhaps a recent statistic about members of Congress will help clarify. In an article on Yahoo Finance (“Members of US Congress Get Richer Despite Sour Economy,” Nov. 17, 2010), a study by the Center for Responsive Politics reported this: about half of all members of Congress, 261 of them, were millionaires, one in five being worth at least $10 million, with eight in the $100 million-plus range (Rep. Darrell Issa, Republican of California, led with personal wealth of $303.5 million). Then contrast median household incomes between these mandarins and those they represent: for a House member, it was $765,010 in 2009r, an increase of more than $100,000 from 2008 (senatorial median income rose by a smaller percentage but a comparable dollar amount, ca. $100,000, to $2.38 million/yr), while for average working slobs, median household income dropped 3% at the same time (between 2008 and 2009) to about $50,000 annually. When stock holdings were examined, it should come as no surprise that these “people’s representatives” had most holdings in the “bigs,” like General Electric (which owns CNBC), Bank of America, Cisco Systems, Proctor & Gamble, and Microsoft. Also popular were Goldman Sachs, Wells Fargo, JP Morgan Chase, and Citygroup, all of whom received TARP money. As the report put it:
Nice work if you can get it.
So we’re left with this. Unless you’re one of the wealthiest 1% in this country, you’re being taken to the cleaners by the most well-oiled machine ever invented to do the job. They have the money, the legislators, the lobbyists (moving in a revolving door from Congress to lobbying and back again, like the recently elected Senator Dan Coats of Indiana) the propaganda organs at every level, and the stupidity of the public to help. They also have a level of unbridled greed that would make ancient Roman plutocrats blanche with shame. It sort of makes one wonder: how long can this organized theft and thuggery continue? Where is the righteous (and I don’t mean the manipulated Tea Party variety) wrath of “the people?” Are there any “people” left?
Lawrence DiStasi
Consider some facts assembled by Robert Freeman in a recent article (“Rich Declare War on the Middle Class,” Nov. 14, Commondreams.org). He begins with Ronald Reagan’s ‘revered’ administration, which “cut the marginal tax rate on the highest income earners from 75% to 35% while dramatically expanding spending for war.” Result: the national debt quadrupled between 1980 and 1992. But did anyone howl then? No, conservative economists kept saying, debt doesn’t matter; it’s a small percent of GDP. Both Bushes continued the trend, with W getting the prize, reducing the tax rate even more, spending trillions on war, and more than doubling the share of income to the top 1% (40% of his tax cut went to the top 1% of earners), and tripling the share to the top 1/10th of 1%. In dollars, this means that from 1973 till today, real wages for workers dropped, with adjusted income of the bottom fifth falling by about $7000/year, while yearly income for the top 1% increased by no less than $741,000. The figures for wealth held by each class are even starker: the top 1% now holds 34% of the nation’s wealth while the bottom half holds a mere 2.5%. As for the bottom two-fifths, they hold nothing, zero, zilch.
You might think, if you’re one of the working or middle classes—i.e., one of the growing numbers on food stamps (1 out of 8 Americans) or in official poverty (1 out of 5 Americans)—that perhaps this would satisfy the rich. But greed is insatiable. So now we hear from some of those alarmed individuals who have suddenly grown concerned over our national debt—particularly at the Obama adminstration providing a stimulus to create jobs for some of the 25 million unemployed, and also trying to reform the health care system to include more Americans left out of the worst system in the world—that something must be done. Our nation will go broke, they cry. We can’t sustain this kind of spending, they moan. And so we have the recommendations of the National Deficit Commission—to rip off the working classes even more. To allegedly lower the deficit by $4 billion, they propose remedies like this: eliminate the tax deduction for mortgage payments, which will decimate one of the last remaining sources of wealth for most people, their homes. They also propose to cut back the meager benefits provided by Social Security, lowering cost-of-living adjustments, raising the minimum retirement age, and while they’re at it, increasing the co-pays and deductibles for Medicare. And of course, they propose to reduce spending—which always means not cutting the military spending that’s bankrupting the country (recent govt estimates place the cost of keeping one (1) soldier in Afghanistan for a year at $1 million; that’s one soldier!), but the paltry programs that benefit the poor and the indigent.
And the monstrous benefits for the rich? Not a word about that. Or rather, those are slated to be increased! The Commission proposes to lower the maximum tax on the highest income earners from 35% to 24%, while their great buddies, the corporations, also get a drop in their nominal tax rate from 35% to 24% (those who actually pay taxes, that is.)
Amazing. But that’s not all. Into the fray, recently, has come yet another proposal from a front organization calling itself the Bipartisan Policy Center, made up of 19 prominent citizens, ex-legislators, ex-governors, and so on, chaired by retired Senator Pete Domenici of New Mexico and a former budget director, Alice Rivlin. And what do they propose to “solve” our crisis? Why yet another tax holiday, this time a suspension of the Social Security payroll tax for a year or two, cutting and simplifying individual and corporate tax rates, and, get this, instituting a new 6.5% national sales tax. That’s to make up for the huge tax losses from the tax holiday. Now anyone who knows anything about taxation knows that sales taxes (and fees for things like drivers’ licenses, etc.) are regressive: that is, because the tax on purchases constitutes a much larger percentage of disposable income for the poor and working classes than it does for the rich, its impact on the poor is orders of magnitude greater. This is the whole theory behind a graduated income tax: to help make up for the disparity in wealth (and the wealthy always consume more natural resources and public services than their poorer counterparts), the tax on those who earn more should comprise a greater percentage of their earnings. But increasingly in our “everything for the wealthy” nation, progressive taxes are seen as unfairly depriving the wealthy of their just desserts. Tax has become a dirty word—as if any nation or any community could long survive without it. And increasing taxes, why that has become the equivalent of the black plague. So we have more and more proposals for sales taxes to bail out state and local governments, as well as the federal government, from the income tax-deprived holes they’ve dug for themselves.
The question is, why would elected representatives be so inclined to ignore the poor and aid the rich (the cost of the recent bailout of banks and Wall Street has been estimated at $13 trillion, and growing)? Perhaps a recent statistic about members of Congress will help clarify. In an article on Yahoo Finance (“Members of US Congress Get Richer Despite Sour Economy,” Nov. 17, 2010), a study by the Center for Responsive Politics reported this: about half of all members of Congress, 261 of them, were millionaires, one in five being worth at least $10 million, with eight in the $100 million-plus range (Rep. Darrell Issa, Republican of California, led with personal wealth of $303.5 million). Then contrast median household incomes between these mandarins and those they represent: for a House member, it was $765,010 in 2009r, an increase of more than $100,000 from 2008 (senatorial median income rose by a smaller percentage but a comparable dollar amount, ca. $100,000, to $2.38 million/yr), while for average working slobs, median household income dropped 3% at the same time (between 2008 and 2009) to about $50,000 annually. When stock holdings were examined, it should come as no surprise that these “people’s representatives” had most holdings in the “bigs,” like General Electric (which owns CNBC), Bank of America, Cisco Systems, Proctor & Gamble, and Microsoft. Also popular were Goldman Sachs, Wells Fargo, JP Morgan Chase, and Citygroup, all of whom received TARP money. As the report put it:
The most popular investment among congressional members reads as a who's who list of the most powerful corporate political forces in Washington, D.C. -- companies that each spend millions, if not tens of millions of dollars each year lobbying federal officials.
Nice work if you can get it.
So we’re left with this. Unless you’re one of the wealthiest 1% in this country, you’re being taken to the cleaners by the most well-oiled machine ever invented to do the job. They have the money, the legislators, the lobbyists (moving in a revolving door from Congress to lobbying and back again, like the recently elected Senator Dan Coats of Indiana) the propaganda organs at every level, and the stupidity of the public to help. They also have a level of unbridled greed that would make ancient Roman plutocrats blanche with shame. It sort of makes one wonder: how long can this organized theft and thuggery continue? Where is the righteous (and I don’t mean the manipulated Tea Party variety) wrath of “the people?” Are there any “people” left?
Lawrence DiStasi
Sunday, November 7, 2010
Wag the Dog
So many bizarre results from the Republican tsunami in last week’s mid-term elections—which to choose first?
How about this? Pick a target for the United States military to attack—urr, uh, how about Iran?—and see if it flies. Might even be able to convince Obama, now that he’s staggering from his ‘shellacking,’ to use it as a surefire way to get re-elected. You know, the old Wag the Dog scenario, where a weakened president starts a war to galvanize public opinion in his favor (Clinton allegedly did it in Bosnia; Bush clearly did it in Iraq after 9/11). Nevermind that we’re already engaged in two wars in the Middle East. Nevermind that another war would surely raise the deficit to newer more dizzying heights. War works.
Unlikely as such madness might seem to most of us, some recent trial balloons suggest that we should all think again.
For example, Senator Lindsey Graham (one of the so-called Republican “moderates” in the Senate who was flirting with voting for the Health Care Bill) just recently raised the issue of attacking Iran at a security conference in Canada (Saturday, Nov. 6). Asserting that “containment is off the table,” Graham said that war on Iran had several positive components to recommend it: “not to just neutralize their nuclear program, but to sink their navy, destroy their air force and deliver a decisive blow to the Revolutionary Guard, in other words neuter that regime.” (Matt Duss, ThinkProgress, 7 November 2010). This is astonishing, not only because countless international observers have opined that such an attack would prove counterproductive—actually leading more surely to a nuclear-armed Iran than anything else (Duss in the above-referenced article cites several of these informed opinions)—but also because it was not that long ago that the CIA’s National Intelligence Estimate stated that “not only was Iran NOT working on a nuclear weapon, but it had ended its nuclear weapons efforts in 2003” (see my blog “Iran Again,” June 9, 2008). No matter, the "reasonable" Senator Graham had no hesitation at all in calling for another war against this “great threat.”
He’s not alone. But more subtly than Graham’s, the notion of a military strike on Iran has recently been framed as a great way for President Obama to rescue his tattered reputation in time for the 2012 elections. ‘Wag the Dog.' The amazing thing here, though, is that the nation’s oldest and most respected journalist, is proposing the war option. David Broder, of the Washington Post, wrote a piece on October 31 on the eve of the election, titled, “How Obama Might Recover.” Beginning with his august opinion that conventional policy options would probably not work to revive the economy in time since no one can design surefire economic measures, Broder gets to his “inside” advice to the President on one measure that might:
Now this is truly bizarre. Broder is no nutball conservative; if anything, he tends toward the liberal end of the spectrum. And yet, here he is, seriously and publicly proposing that the President of the United States start a pre-emptive war with a nation that has attacked no one, in order to rescue his failing presidency and improve the economy. After what we’ve been through in the last ten years with Bush’s pre-emptive wars and the huge hole they put in the nation’s budget (estimates for the Iraq war go as high as $3 trillion! not to mention the cost in death, the drubbing of America’s reputation in the world, and so on), for a respected journalist to seriously offer a plan like this begins to make Tea Party wackos look sane. Broder, of course, is quick to stress that he’s “not suggesting, of course, that the president incite a war to get reelected.” Oh heavens no. But he goes on to close his piece with precisely that suggestion:
No proof, of course, for his assertion that Iran is, in fact, “the greatest threat to the world in the young century.” Nothing but the uncontested assertion of our senior pundit—and the appetizing carrot to the young president that he will have “made the world safer” and be regarded by history (or at least by Broder) as one of our most “successful presidents.”
How is one to explain such a thing? Has the 81-year-old Broder gone senile? Or is he just listening to a few other pundits who have actually said the same thing recently. Like, for example, the rabidly pro-Israel Elliott Abrams (he of Iran-Contra fame, resuscitated as a ‘National Security Adviser for Global Democracy Strategy’ for Bush) who said recently: “The Obama who had struck Iran and destroyed its nuclear program would be a far stronger candidate, and perhaps an unbeatable one.” Or the equally rabid Daniel Pipes: “a strike on Iranian facilities would dispatch Obama’s feckless first year down the memory hole and transform the domestic political scene.” (both quoted by Eric Alterman, www.americanprogress.org, Nov. 4, 2010). Whatever the source for his loony idea, it is enough to give one pause. And though most commentators on Broder’s lunacy have discounted the fact that it might influence President Obama, we would do well to consider where the president stands with respect to Iran. When he was running for President, he spoke to AIPAC, the America Israel Political Action Committee, a front for promoting even the most right-wing Israeli policies in Washington. As I noted in the above-mentioned blog, what candidate Obama said, at that time, was that he was holding Iran responsible for the rockets launched by Hezbollah on Israel after the latter attacked Lebanon. He added,
The Obama administration’s rhetoric excoriating Iran for its alleged nuclear weapons program has only escalated since then.
Is it beyond the realm of possibility, then, that a severely wounded Obama would consider the Broder/Abrams/Pipes suggestion (NB: Jeffrey Goldberg’s September 2010 piece in the Atlantic Magazine, “The Point of No Return,” in which he essentially predicts and rationalizes the fact that Israel will, in the next year, attack Iran itself, may be the mother of all such Israeli-promoted trial balloons; it ends with this quote from Israeli President Shimon Peres: “We don’t want to win over the president,” he said. “We want the president to win.”)?
Given the madness now at large in this nation, it would be folly to think so.
Lawrence DiStasi
How about this? Pick a target for the United States military to attack—urr, uh, how about Iran?—and see if it flies. Might even be able to convince Obama, now that he’s staggering from his ‘shellacking,’ to use it as a surefire way to get re-elected. You know, the old Wag the Dog scenario, where a weakened president starts a war to galvanize public opinion in his favor (Clinton allegedly did it in Bosnia; Bush clearly did it in Iraq after 9/11). Nevermind that we’re already engaged in two wars in the Middle East. Nevermind that another war would surely raise the deficit to newer more dizzying heights. War works.
Unlikely as such madness might seem to most of us, some recent trial balloons suggest that we should all think again.
For example, Senator Lindsey Graham (one of the so-called Republican “moderates” in the Senate who was flirting with voting for the Health Care Bill) just recently raised the issue of attacking Iran at a security conference in Canada (Saturday, Nov. 6). Asserting that “containment is off the table,” Graham said that war on Iran had several positive components to recommend it: “not to just neutralize their nuclear program, but to sink their navy, destroy their air force and deliver a decisive blow to the Revolutionary Guard, in other words neuter that regime.” (Matt Duss, ThinkProgress, 7 November 2010). This is astonishing, not only because countless international observers have opined that such an attack would prove counterproductive—actually leading more surely to a nuclear-armed Iran than anything else (Duss in the above-referenced article cites several of these informed opinions)—but also because it was not that long ago that the CIA’s National Intelligence Estimate stated that “not only was Iran NOT working on a nuclear weapon, but it had ended its nuclear weapons efforts in 2003” (see my blog “Iran Again,” June 9, 2008). No matter, the "reasonable" Senator Graham had no hesitation at all in calling for another war against this “great threat.”
He’s not alone. But more subtly than Graham’s, the notion of a military strike on Iran has recently been framed as a great way for President Obama to rescue his tattered reputation in time for the 2012 elections. ‘Wag the Dog.' The amazing thing here, though, is that the nation’s oldest and most respected journalist, is proposing the war option. David Broder, of the Washington Post, wrote a piece on October 31 on the eve of the election, titled, “How Obama Might Recover.” Beginning with his august opinion that conventional policy options would probably not work to revive the economy in time since no one can design surefire economic measures, Broder gets to his “inside” advice to the President on one measure that might:
What else might affect the economy? The answer is obvious, but its implications are frightening. War and peace influence the economy.
Look back at FDR and the Great Depression. What finally resolved that economic crisis? World War II.
Here is where Obama is likely to prevail. With strong Republican support in Congress for challenging Iran's ambition to become a nuclear power, he can spend much of 2011 and 2012 orchestrating a showdown with the mullahs. This will help him politically because the opposition party will be urging him on. And as tensions rise and we accelerate preparations for war, the economy will improve. (Broder, Washington Post, 10/31/10)
Now this is truly bizarre. Broder is no nutball conservative; if anything, he tends toward the liberal end of the spectrum. And yet, here he is, seriously and publicly proposing that the President of the United States start a pre-emptive war with a nation that has attacked no one, in order to rescue his failing presidency and improve the economy. After what we’ve been through in the last ten years with Bush’s pre-emptive wars and the huge hole they put in the nation’s budget (estimates for the Iraq war go as high as $3 trillion! not to mention the cost in death, the drubbing of America’s reputation in the world, and so on), for a respected journalist to seriously offer a plan like this begins to make Tea Party wackos look sane. Broder, of course, is quick to stress that he’s “not suggesting, of course, that the president incite a war to get reelected.” Oh heavens no. But he goes on to close his piece with precisely that suggestion:
But the nation will rally around Obama because Iran is the greatest threat to the world in the young century. If he can confront this threat and contain Iran's nuclear ambitions, he will have made the world safer and may be regarded as one of the most successful presidents in history.
No proof, of course, for his assertion that Iran is, in fact, “the greatest threat to the world in the young century.” Nothing but the uncontested assertion of our senior pundit—and the appetizing carrot to the young president that he will have “made the world safer” and be regarded by history (or at least by Broder) as one of our most “successful presidents.”
How is one to explain such a thing? Has the 81-year-old Broder gone senile? Or is he just listening to a few other pundits who have actually said the same thing recently. Like, for example, the rabidly pro-Israel Elliott Abrams (he of Iran-Contra fame, resuscitated as a ‘National Security Adviser for Global Democracy Strategy’ for Bush) who said recently: “The Obama who had struck Iran and destroyed its nuclear program would be a far stronger candidate, and perhaps an unbeatable one.” Or the equally rabid Daniel Pipes: “a strike on Iranian facilities would dispatch Obama’s feckless first year down the memory hole and transform the domestic political scene.” (both quoted by Eric Alterman, www.americanprogress.org, Nov. 4, 2010). Whatever the source for his loony idea, it is enough to give one pause. And though most commentators on Broder’s lunacy have discounted the fact that it might influence President Obama, we would do well to consider where the president stands with respect to Iran. When he was running for President, he spoke to AIPAC, the America Israel Political Action Committee, a front for promoting even the most right-wing Israeli policies in Washington. As I noted in the above-mentioned blog, what candidate Obama said, at that time, was that he was holding Iran responsible for the rockets launched by Hezbollah on Israel after the latter attacked Lebanon. He added,
we must preserve our total commitment to our unique defense relationship with Israel by fully funding military assistance and continuing to work on the Arrow and related missile defense programs…(to) help Israel maintain its military edge and deter and repel attacks from as far as Tehran and as close as Gaza.
The Obama administration’s rhetoric excoriating Iran for its alleged nuclear weapons program has only escalated since then.
Is it beyond the realm of possibility, then, that a severely wounded Obama would consider the Broder/Abrams/Pipes suggestion (NB: Jeffrey Goldberg’s September 2010 piece in the Atlantic Magazine, “The Point of No Return,” in which he essentially predicts and rationalizes the fact that Israel will, in the next year, attack Iran itself, may be the mother of all such Israeli-promoted trial balloons; it ends with this quote from Israeli President Shimon Peres: “We don’t want to win over the president,” he said. “We want the president to win.”)?
Given the madness now at large in this nation, it would be folly to think so.
Lawrence DiStasi
Thursday, November 4, 2010
Quantitative Easing, or, The Rich Get Richer
Here’s my favorite take on the elections.
The Federal Reserve and its head, Ben Bernanke, have recently announced their latest initiative, called “quantitative easing.” Aside from the fact that this sounds somewhat pornographic, it apparently means that a central bank creates money ex nihilo, i.e. out of nothing (sometimes called printing money, though these days it’s not so crude; the Fed just magically adds billions to its account), and then uses the funds to purchase financial assets (including government bonds, mortgage-backed securities, and corporate bonds) from regular banks and financial institutions. The Fed, this time, is apparently going to create some $600,000,000,000 (that’s billions), a sum, according to Chrystia Freeland of Reuters, “nearly as big as the TARP. It’s nearly as big as the first stimulus was.”
Now why, you might ask, would the Fed be doing this now. Well apparently, the Fed and most economists really think it’s imperative that the economy get another boost to prevent it from going into a second tailspin. And since the Fed is pretty sure, especially now that the “people” have spoken and swept out Democrats and swept in Republicans (giving the latter control of the House) that there is going to be even worse gridlock in Congress and the White House than before, they have to act. In short, there’s not a snowball’s chance in hell that this Congress will pass another stimulus, so the unelected Fed has to do it.
Here's where it gets interesting. The “people,” according to pundits and pollsters, have decided that Obama and the Democrats have spent too much money keeping the country out of depression; the stimulus, in particular, has been rejected as the product of “big spending Democrats.” It’s time to cut back on spending, is the alleged popular message, to get money back to the people. And how to do that: why by putting back into power the Republicans—the very party that crashed the economy in the first place. NO MORE STIMULUS, is the message. And yet, economists agree a stimulus is needed, and so the Fed rides to the rescue. The irony of all this? Listen to Chrystia Freeland:
Now isn’t that sweet? The poor working-class slobs in the Midwest and South (the Tea Partiers) who voted the Republicans into office presumably believed they were voting to help themselves. But by voting for gridlock, they are doing exactly the opposite! They are forcing the Fed to push a stimulus through the back door. And that stimulus, quantitative easing, is going to help the very people—the bankers and financial pirates—voters are supposedly pissed off at. Banks are infused with tons of money, presumably to induce them to lend to small businesses and households to increase buying. But the banks don’t really have to do that (and all indications are that they don’t want to). Rather, they’ll invest in foreign assets where they can make more profit (have people still not caught on that financial institutions and corporations couldn’t give less of a damn about the USA?). And because there’s a whole lot more money in circulation, it’s going to increase inflation. All of which will help make people like us even poorer. We’ll be poorer, too, because the Fed’s stimulus doesn’t create jobs directly, as another stimulus from Congress presumably would.
Is our democracy not a wondrous thing? It allows damned fools, like the ones who enjoyed victory on Tuesday, the freedom to vote against themselves! While the financiers laugh all the way the bank.
There are other, perhaps more serious global downsides to this latest move of the Fed. But frankly I’m not sure I understand how it all works well enough to explain it. To get some ideas, check out Professor Michael Hudson, “U.S. Quantitative Easing is Fracturing the Global Economy,” at http://globalresearch.ca/index.php?context=va&aid=21716). Meantime, and remembering that “quantitative easing” didn’t work for Japan in the 1990s, enjoy the irony. It may provide the only laughs we get for a while.
Lawrence DiStasi
The Federal Reserve and its head, Ben Bernanke, have recently announced their latest initiative, called “quantitative easing.” Aside from the fact that this sounds somewhat pornographic, it apparently means that a central bank creates money ex nihilo, i.e. out of nothing (sometimes called printing money, though these days it’s not so crude; the Fed just magically adds billions to its account), and then uses the funds to purchase financial assets (including government bonds, mortgage-backed securities, and corporate bonds) from regular banks and financial institutions. The Fed, this time, is apparently going to create some $600,000,000,000 (that’s billions), a sum, according to Chrystia Freeland of Reuters, “nearly as big as the TARP. It’s nearly as big as the first stimulus was.”
Now why, you might ask, would the Fed be doing this now. Well apparently, the Fed and most economists really think it’s imperative that the economy get another boost to prevent it from going into a second tailspin. And since the Fed is pretty sure, especially now that the “people” have spoken and swept out Democrats and swept in Republicans (giving the latter control of the House) that there is going to be even worse gridlock in Congress and the White House than before, they have to act. In short, there’s not a snowball’s chance in hell that this Congress will pass another stimulus, so the unelected Fed has to do it.
Here's where it gets interesting. The “people,” according to pundits and pollsters, have decided that Obama and the Democrats have spent too much money keeping the country out of depression; the stimulus, in particular, has been rejected as the product of “big spending Democrats.” It’s time to cut back on spending, is the alleged popular message, to get money back to the people. And how to do that: why by putting back into power the Republicans—the very party that crashed the economy in the first place. NO MORE STIMULUS, is the message. And yet, economists agree a stimulus is needed, and so the Fed rides to the rescue. The irony of all this? Listen to Chrystia Freeland:
I think the problem is, when the Fed acts as it does, printing more money, it’s a rich-get-richer phenomenon. This is going to be great for the banks. It’s going to be great for people whose personal finances are strong enough that they can re-mortgage—refinance their mortgages. But it’s not so great for the people who are in trouble. And that’s one reason why it might not have as powerful an impact as the Fed would like.
Now isn’t that sweet? The poor working-class slobs in the Midwest and South (the Tea Partiers) who voted the Republicans into office presumably believed they were voting to help themselves. But by voting for gridlock, they are doing exactly the opposite! They are forcing the Fed to push a stimulus through the back door. And that stimulus, quantitative easing, is going to help the very people—the bankers and financial pirates—voters are supposedly pissed off at. Banks are infused with tons of money, presumably to induce them to lend to small businesses and households to increase buying. But the banks don’t really have to do that (and all indications are that they don’t want to). Rather, they’ll invest in foreign assets where they can make more profit (have people still not caught on that financial institutions and corporations couldn’t give less of a damn about the USA?). And because there’s a whole lot more money in circulation, it’s going to increase inflation. All of which will help make people like us even poorer. We’ll be poorer, too, because the Fed’s stimulus doesn’t create jobs directly, as another stimulus from Congress presumably would.
Is our democracy not a wondrous thing? It allows damned fools, like the ones who enjoyed victory on Tuesday, the freedom to vote against themselves! While the financiers laugh all the way the bank.
There are other, perhaps more serious global downsides to this latest move of the Fed. But frankly I’m not sure I understand how it all works well enough to explain it. To get some ideas, check out Professor Michael Hudson, “U.S. Quantitative Easing is Fracturing the Global Economy,” at http://globalresearch.ca/index.php?context=va&aid=21716). Meantime, and remembering that “quantitative easing” didn’t work for Japan in the 1990s, enjoy the irony. It may provide the only laughs we get for a while.
Lawrence DiStasi
Friday, October 29, 2010
The Eve of Elections
Less than a week before the 2010 midterm elections for Congress, anyone with a soul feels the need to expel some of the indigestion that has been building in the gut. Recent news affords ample material, even if it seems a bit disjointed.
Let’s begin with the types of candidates that are threatening to actually win—even above and beyond the idiots like Sharron Angle in Nevada and Christine O’Donnell in Delaware. Consider the lovely candidate threatening to unseat the blue dog Democratic incumbent in North Carolina, Ilario Pantano. Republican Pantano is a 38-year-old veteran of the Iraq war, but what a veteran! He had actually fought in the first gulf war as a marine, but after 9/11 decided to leave his job at Goldman Sachs (where else?) and re-enlist. Serving as a 2d Lieutenant, he was involved in an “incident” in 2004 shortly after the highly-publicized hanging of four American private contractors in Fallujah. As reported in the Oct. 26 Guardian, on 15 April, Pantano and crew stopped two unarmed Iraqi men in a car—suspects, as all Iraqis were. After a car search, he
A few months later, a member of his own unit reported him and he was charged with murder. Other facts emerged: the bodies of the two men, Hamaady Kareem and Tahah Hanjil, were found in a kneeling position, and they were shot in the back. But Pantano’s defense alleged that weapons had been found in the house the Iraqis exited, and the men had “turned on Pantano unexpectedly” as he was guarding them, so he fired in self-defense. It didn’t take long for the charges against Pantano to be dropped for ‘lack of evidence,’ though the officer in charge of the hearing did recommend non-judicial punishment for “extremely poor judgment.” In his campaign, Pantano has refused to defend himself “for something that happened five years ago.” As to the placard he left (which also became the title of a book he wrote, part of the reason for his fame), Pantano has said: “I don’t need to explain anything…If folks are alarmed, well war is alarming.”
Yes. War is alarming. First and foremost for the brutality it rewards—rendering to psychopaths like Pantano hero worship, a book, and now a chance to be a U.S. Congressman endorsed by Sarah Palin (she called Pantano “another dedicated patriot running for Congress”) and Pamela Geller (of ‘mosque at ground zero’ fame, whom Pantano, returning the praise, calls “a patriot” whose endorsement “thrills him”) all in return for his brave murder of unarmed, kneeling civilians. Second, for the brutality it inevitably brings not only to those who take part in it, like Pantano, but to those at home who cannot help but be polluted by its ethos. And this includes not just those in Pantano’s district, which, not unexpectedly, sits only a few miles from the main marine training center at Camp Lejeune.
No. I would include, among others, the sweet man from Arkansas who made the news recently. His name is Clint McCance, and he’s vice-president of the Midland School District in a place called (get this) Pleasant Plains, Arkansas. Allegedly upset over a gay rights group’s “Spirit Day” recently, that urged wearing purple to raise awareness about harassment and bullying of gay youth, Mc Cance commented on his Facebook page:
Faced with a firestorm, including, according to McCance, death threats that prompted him to send his wife and children into hiding, the school board VP resigned. He apologized, saying he’s “sorry” for what he wrote on his Facebook page. “I would never support suicide for any kids,” McCance is quoted as saying; indicating that perhaps he’s heard about the rash of gay suicides recently. Isn’t that gratifying? I mean, given the way our politics are going, it shouldn’t be too long before the Tea Party and Sarah Palin are endorsing the very contrite McCance for political office.
As if all this weren’t enough, a recent book and article by sociologist Gar Alperovitz (Unjust Deserts: How the Rich Are Taking Our Common Inheritance and Why We Should Take it Back) puts what looks to be our late, great nation in perspective. You’ve all no doubt heard about how the financial gains of the last 30 years have gone disproportionately to the very rich, while middle class income has stagnated or dropped. Alperovitz points out that the United States now ranks with such advanced nations as Turkmenistan in inequality of income. That is, when measured for income inequality (the gulf between the rich and the rest of us), the United States ranks 77th out of 142 countries—this according to a recent estimate by the United Nations Human Development Report. It is tied not only with Turkmenistan, but also with such bastions of liberty as Tunisia and Georgia. That means that the distribution of income and wealth in the U.S. today is more unequal than at any time since the 1920s.
How did this happen? Taxes, for one. Remember the great tax reforms of the Reagan, Bush I and II eras? including a reduction to 15% on capital gains? Well over the last 25 years, “IRS data indicate that the top 1% of American taxpayers increased their share of the nation’s total pre-tax adjusted gross income from 10% in 1980 to 23.5% in 2007.” What’s more, the gain has little to do with individual efforts. Writes Alperovitz:
Now, of course, the Republican mantra is always that ‘lowering taxes frees up capital so that the rich can invest in job-creating businesses’; but what Alperovitz points out is that top marginal tax rates stood at 91% during several Republican and Democrat presidencies (Eisenhower, Truman, etc.) and those high rates “coincided with the postwar boom, the greatest period of economic growth in all of American history.” The shame is that the pusillanimous Democrats of recent years—Clinton, Obama, and the rest, including, this year in California, Jerry Brown running for governor—have echoed this crap about no new taxes. The result (helped by war, of course) has been the devastation of not just the federal economy, but also the economies of most of the states in the union. The prescribed remedy, always, is to “cut spending.” In other words, cut the benefits to the poor and working classes, who will sink even lower relative to the rich already enjoying the lowest tax rates in history.
What can one say? We seem to be wallowing in an era best described by William Butler Yeats in the early part of the twentieth century:
The poem, The Second Coming, continues,
But whether its dismal conclusion is apropos now is anyone’s guess:
Lawrence DiStasi
Let’s begin with the types of candidates that are threatening to actually win—even above and beyond the idiots like Sharron Angle in Nevada and Christine O’Donnell in Delaware. Consider the lovely candidate threatening to unseat the blue dog Democratic incumbent in North Carolina, Ilario Pantano. Republican Pantano is a 38-year-old veteran of the Iraq war, but what a veteran! He had actually fought in the first gulf war as a marine, but after 9/11 decided to leave his job at Goldman Sachs (where else?) and re-enlist. Serving as a 2d Lieutenant, he was involved in an “incident” in 2004 shortly after the highly-publicized hanging of four American private contractors in Fallujah. As reported in the Oct. 26 Guardian, on 15 April, Pantano and crew stopped two unarmed Iraqi men in a car—suspects, as all Iraqis were. After a car search, he
unloaded a magazine of his M16A4 automatic rifle into them, before reloading and blasting a second magazine over them—some 60 rounds in total. Over the corpses, he left a placard inscribed with the marine motto: ‘No better friend, No worse enemy.’
A few months later, a member of his own unit reported him and he was charged with murder. Other facts emerged: the bodies of the two men, Hamaady Kareem and Tahah Hanjil, were found in a kneeling position, and they were shot in the back. But Pantano’s defense alleged that weapons had been found in the house the Iraqis exited, and the men had “turned on Pantano unexpectedly” as he was guarding them, so he fired in self-defense. It didn’t take long for the charges against Pantano to be dropped for ‘lack of evidence,’ though the officer in charge of the hearing did recommend non-judicial punishment for “extremely poor judgment.” In his campaign, Pantano has refused to defend himself “for something that happened five years ago.” As to the placard he left (which also became the title of a book he wrote, part of the reason for his fame), Pantano has said: “I don’t need to explain anything…If folks are alarmed, well war is alarming.”
Yes. War is alarming. First and foremost for the brutality it rewards—rendering to psychopaths like Pantano hero worship, a book, and now a chance to be a U.S. Congressman endorsed by Sarah Palin (she called Pantano “another dedicated patriot running for Congress”) and Pamela Geller (of ‘mosque at ground zero’ fame, whom Pantano, returning the praise, calls “a patriot” whose endorsement “thrills him”) all in return for his brave murder of unarmed, kneeling civilians. Second, for the brutality it inevitably brings not only to those who take part in it, like Pantano, but to those at home who cannot help but be polluted by its ethos. And this includes not just those in Pantano’s district, which, not unexpectedly, sits only a few miles from the main marine training center at Camp Lejeune.
No. I would include, among others, the sweet man from Arkansas who made the news recently. His name is Clint McCance, and he’s vice-president of the Midland School District in a place called (get this) Pleasant Plains, Arkansas. Allegedly upset over a gay rights group’s “Spirit Day” recently, that urged wearing purple to raise awareness about harassment and bullying of gay youth, Mc Cance commented on his Facebook page:
The only way I’m wearin’ it (purple) for them is if they all commit suicide. I also enjoy the fact that they often give each other aids and die. (Yahoo News, 10/29)
Faced with a firestorm, including, according to McCance, death threats that prompted him to send his wife and children into hiding, the school board VP resigned. He apologized, saying he’s “sorry” for what he wrote on his Facebook page. “I would never support suicide for any kids,” McCance is quoted as saying; indicating that perhaps he’s heard about the rash of gay suicides recently. Isn’t that gratifying? I mean, given the way our politics are going, it shouldn’t be too long before the Tea Party and Sarah Palin are endorsing the very contrite McCance for political office.
As if all this weren’t enough, a recent book and article by sociologist Gar Alperovitz (Unjust Deserts: How the Rich Are Taking Our Common Inheritance and Why We Should Take it Back) puts what looks to be our late, great nation in perspective. You’ve all no doubt heard about how the financial gains of the last 30 years have gone disproportionately to the very rich, while middle class income has stagnated or dropped. Alperovitz points out that the United States now ranks with such advanced nations as Turkmenistan in inequality of income. That is, when measured for income inequality (the gulf between the rich and the rest of us), the United States ranks 77th out of 142 countries—this according to a recent estimate by the United Nations Human Development Report. It is tied not only with Turkmenistan, but also with such bastions of liberty as Tunisia and Georgia. That means that the distribution of income and wealth in the U.S. today is more unequal than at any time since the 1920s.
How did this happen? Taxes, for one. Remember the great tax reforms of the Reagan, Bush I and II eras? including a reduction to 15% on capital gains? Well over the last 25 years, “IRS data indicate that the top 1% of American taxpayers increased their share of the nation’s total pre-tax adjusted gross income from 10% in 1980 to 23.5% in 2007.” What’s more, the gain has little to do with individual efforts. Writes Alperovitz:
…not only do income shares of the kind that flow to the top 1% have little to do with what anyone has actually done to deserve them; rather the flows are largely traceable to technologies that ultimately were either paid for by the public, or more importantly, that derive from our collective inheritance of scientific and technical knowledge. (Alperovitz, Huffington Post, 10/28/10)
Now, of course, the Republican mantra is always that ‘lowering taxes frees up capital so that the rich can invest in job-creating businesses’; but what Alperovitz points out is that top marginal tax rates stood at 91% during several Republican and Democrat presidencies (Eisenhower, Truman, etc.) and those high rates “coincided with the postwar boom, the greatest period of economic growth in all of American history.” The shame is that the pusillanimous Democrats of recent years—Clinton, Obama, and the rest, including, this year in California, Jerry Brown running for governor—have echoed this crap about no new taxes. The result (helped by war, of course) has been the devastation of not just the federal economy, but also the economies of most of the states in the union. The prescribed remedy, always, is to “cut spending.” In other words, cut the benefits to the poor and working classes, who will sink even lower relative to the rich already enjoying the lowest tax rates in history.
What can one say? We seem to be wallowing in an era best described by William Butler Yeats in the early part of the twentieth century:
The best lack all conviction, while the worst/ Are full of passionate intensity.
The poem, The Second Coming, continues,
Surely some revelation is at hand;/ Surely the Second Coming is at hand.
But whether its dismal conclusion is apropos now is anyone’s guess:
And what rough beast, its hour come round at least,
Slouches towards Bethlehem to be born?
Lawrence DiStasi
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